The United States Is a Nuclear Dictatorship

The United States Is a Nuclear Dictatorship

11/15/2017Ryan McMaken

Thanks in part to Trump's bombastic and unpredictable style — but more likely due to his lack of friends in Washington — members of Congress have suddenly realized that maybe, just maybe, it's a bad thing that the President of the United States can unilaterally blow up the world. 

And when I say "President of the United States" I don't mean that as a metonym for the US government as in the phrase "Washington today is considering a pact with Mexico." 

No, a single specific individual really does have the ability to make that decision and give that order — unimpeded in any way. 

This fact — which should daily be regarded by all Americans as an excellent illustration of what a farce "constitutional government" is — is now a topic of debate in Washington. It is now being suggested that some of those alleged "checks and balances" we're always being told about might be applied to the most destructive and apocalyptic power enjoyed by a US government agent. 

CNN reports

Congressional lawmakers raised concerns about President Donald Trump's ability to use nuclear weapons during a hearing Capitol Hill Tuesday amid bipartisan anxiety over launch process procedures and indications that the administration has considered the option of a first strike on North Korea.

Members of the Senate foreign affairs committee called into question a decades-old presidential authority to deploy nuclear weapons in what was the first congressional hearing on nuclear authorization in decades.

You read that right. This is the first time Congress has considered the question of a president's nuclear-warmaking prerogatives in decades. Congress, on the other hand, has been quite busy during that time holding hearings about steroid use in sports, and violence on television.

As it stands right now, the president can start a nuclear war all by himself. We're talking about first strike capability here, and not about merely a response to military action by another state.

The LATimes tells us how easy it is: 

All he has to do is call in the military officer who carries the “football,” the bulky briefcase containing the nuclear codes, and work through a brief procedure to transmit launch orders to U.S. Strategic Command...There are really no checks and balances,” said Bruce G. Blair, a former nuclear launch control officer who is now a researcher at Princeton University. “The presidency has become a nuclear monarchy.”

"Nuclear dictatorship" probably better captures the reality of the situation.

Thus, all the president has to do is decide — perhaps based on whatever unreliable information the CIA is feeding him — that now is the time to unleash a nuclear holocaust on, say, North Korea. Once the bombers are flying, or once the missiles are launched, of course, we'll then have to hope that none of them are interpreted as threats to major nuclear powers like China and Russia, both of which are right next door. 

Indeed, it's this unpredictability of how a nuclear strike might get out of hand has long been a limiting factor on the use of the weapons. During the Vietnam War, for example, using nuclear weapons were discussed as a possible alternative to the failed bombing strategy at the time. The problem strategists encountered was the sheer volume of unpredictable consequences that could result from usage. 

The downsides of starting a nuclear conflict are immense, both in terms of global diplomacy, and in terms of actual risk to the American population. 

But even with this reality staring us in the face, Washington is so obsessed with maintaining an aggressive military stance, that it's unwilling to seriously consider any limitation on the President. 

This why we should expect no real changes out of these Congressional hearings. Not surprisingly, Congress has already taken any meaningful change off the table: 

Ultimately, the panel warned against legislative changes to rein in the President's authority to exercise nuclear authority.

"I think hard cases make bad law, and I think if we were to change the decision-making process in some way because of a distrust of this President, I think that would be an unfortunate precedent," said Brian Mckeon, who previously served as Principal Deputy Under Secretary of Defense for Policy during the Obama administration.
This pretty much sums up how Washington's foreign policy works. Limiting the power of the President in any way, we're told "would be an unfortunate precedent." After all, this Trump guy may be a jerk, but all the other Presidents are totally wonderful human beings. We wouldn't want to limit their power to blow up the planet.
When commenting, please post a concise, civil, and informative comment. Full comment policy here

Count Our Blessings, Not Miseries

07/09/2021Gary Galles

It is a natural human tendency to focus on our problems, but such a focus has a cost—exaggerating the size of the problems we face relative to the size of the blessings we benefit from. In a sense, that tendency may be more pronounced today among those who advocate for liberty, because they recognize the cornucopia of blessings liberty enables, yet they see those liberties eroding and sometimes collapsing.

Less liberty than we could have is indeed disheartening. However, that has always been the case. On the bright side, the many ways liberty has found to get around man-made limitations has still bequeathed us blessings beyond even the wildest dreams of earlier generations. And it also means that, looking forward, the potential gains from expanding liberty from where it is today are also larger (like supply-side economics, in that the benefits from tax cuts are greater, the higher the initial tax rate, because they cause a greater proportionate increase in take-home pay in that case).

Leonard Read urged us, as have many others over many years, to “Count Our Blessings, Not Miseries,” in Chapter 23 of his 1981 Thoughts Rule the World. His focus, and his reasoning for it, deserves consideration.

  • There are ever so many freedom devotees who are afflicted with downheartedness. Their pessimism is due to the political skullduggery--“rascality; trickery”--that features our present decline into socialism.
  • We need to see the evil but, at the same time, see the good: our blessings--thousands of times greater.
  • Good and bad have existed together since the beginning of time, but no one needs to wallow in the bad…that much more time to think about what’s right and to count my blessings.
  • Our blessings are so common that we forget to praise them, that is, to count them!
  • The original source of the American miracle was our Declaration--unseating government as the source of human rights and placing the Creator there. The companion documents--the Constitution and the Bill of Rights--limited government more than ever before in history! Result? Americans looked to themselves rather than to government for welfare. Self-responsibility on an unprecedented scale! The millions enjoying blessings by the millions!
  • What happened after decades of countless blessings? The Source forgotten! And why? The blessings have become so abundant that today’s citizens take them for granted.
  • There is, also, a very important reason for counting our blessings: it helps rid the soul of covetousness. To count one’s blessings is to accent what’s right… covetousness is as deadly as any of the other sins--indeed, it tends to induce the others.
  • Covetousness or envy generates a destructive radiation with ill effect on all it touches.
  • Consider the social implications, the effects of envy on others. At first blush, the rich man appears not to be harmed because another covets his wealth. Envy, however, is not a benign, dormant element of the psyche; it has the same intensive force as rage, and a great deal of wisdom is required to put it down. Where understanding and self-control are wholly lacking, the weakling will resort to thievery, embezzlement, piracy, even murder, to gratify his envy and “get his share.”
  • Though weakness of character afflicts all of us to some extent, only a few are so lacking in restraining forces as to personally employ naked force, such as thievery, to realize the objects of envy. Fear of apprehension and reprisal tends to hold such open-faced evil in check.
  • However, if the evil act can be screened, if the sense of personal guilt and responsibility can be sufficiently submerged, that is, if self-delusion can be effected, gratification of covetousness will be pursued by the “best people.”
  • The way is no secret: achieve anonymity in a mob, committee, organization, society, or hide behind legality or majority vote.
  • With the fear of exposure removed, millions of Americans feather their own nests at the expense of others, and on a scale never imagined by thieves, pirates, or embezzlers. Our “best people”…gratify their envy with no qualms whatsoever. But their salved conscience in no way lessens the evil of covetousness; quite the contrary, it emphasizes to us how powerfully this evil operates at the politico-economic level. This subtle evil is indeed the genesis of more obvious sins.
  • We should also note the extent to which this “guiltless” taking of property by coercion is rationalized. Accomplices, bearing such titles as philosophers and economists…explain how the popular depredations are good to everyone, even for those looted. Thus, we find that covetousness, unchecked in the individual, lies at the root of the decline and fall of nations and civilizations.
  • As contrasted with the emulation of virtues, which takes nothing from but adds to the welfare of others, envy is nothing more than an avaricious greed to possess what exclusively belongs to others…opposed to an elevation of the spirit… William Penn grasped this point: “Covetousness is the greatest of Monsters, as well as the root of all Evil.”
  • It is impossible for the eye to be cast covetously at the material possessions of others and cast aspiringly at one’s own creativity. Thus, envy leaves unattended the human being’s upgrading…envy leaves the soul, the spirit, the intellect, the psyche to rot, and there can be no greater evil than this…it surely behooves each of us to find a way to rid himself of this evil…Count your blessings!
  • Any person who is not aware of countless blessings, regardless of how low or high his estate, will be no more aware of his blessings should his envy be gratified. Awareness of blessings is a state of consciousness and is not necessarily related to abundance and affluence. He who is rich in worldly goods but unaware of his blessings is poor, and probably covetous; he who is poor in worldly goods but aware of his blessings is rich, and assuredly without envy.
  • Count your blessings…for wisdom is awareness.
  • As progress is made in an awareness of our blessings, we are struck by how greatly they outnumber our woes and troubles. In a state of unawareness, the woes loom enormous, and we tend to covetousness; in awareness the woes are but trifles, and the covetousness fades away.
  • This remarkable cure for covetousness also puts us on the road to social felicity; for we best serve ourselves and others through the exercise of self-responsibility and freedom!

Leonard Read’s recognition that we should count our blessings is part of a long line of wisdom, derived over centuries of human experience. That advice is certainly no less true of adherents to liberty, whose arguments also rely on the wisdom of the ages (even if largely learned from liberty’s absence). But Read also reminds us of the truth that for us as individuals as well as a society, “Counting your blessings will give you more blessings to count,” as Victoria Brown has pointed out. And we all want more blessings.

When commenting, please post a concise, civil, and informative comment. Full comment policy here

Economic Calculation under the Fed

07/09/2021Robert Aro

When the Federal Reserve or government intervenes in our lives and the free market, it’s normally referred to as “central planning” or “economic planning.” However, whenever a handful of handsomely compensated people make economic decisions on behalf of the citizens, economic calculation is impossible. But without economic calculation, how are decisions made?

Last Thursday, Federal Reserve Bank of Philadelphia president Patrick Harker gave an interview to the Wall Street Journal, illustrating the thought process for “tapering” the Fed’s balance sheet:

We’re talking about a process that once we start it, depending on how we do it, would be, say, 12 months in length…. We’re doing $120 billion a month, if we cut back $10 billion each month, we’d be done in 12 months, right? I think that’s a reasonable thing to do.

He’s referring to the $8 trillion balance sheet which the Fed has been steadily increasing by purchasing approximately $120 billion worth of US and mortgage debt over the past year.

Interestingly, this tapering doesn’t refer to actually shrinking the balance sheet from its current all-time high. Instead, the goal is to decrease the number of new purchases by a smaller amount on a month-over-month basis.

Under his plan, one year later the Fed would add approximately $760 billion new securities. If the Fed continued its $120 billion monthly purchase for an entire year, the result would be approximately $1.4 trillion in new securities purchased in the year. It hasn’t been stated what happens after the one-year mark is reached.

While true, $760 billion is less than $1.4 trillion, the takeaway is the method these planners use to arrive at these billion-dollar ideas. The first issue is that the rationale behind $120 billion per month payments by the Fed has never been explained. Other than telling the public that this money will add liquidity to the market, no one has ever explained how the purchase amount was arrived at. They could have bought $60 billion a month, or $200 billion a month. Either way, there exists no measurement or calculation by which to say that $120 billion per month is the correct or even “optimal” number of securities to purchase.

Over a year later, the Fed recognizes they should not baselessly increase the money supply indefinitely; therefore, talk of tapering begins. But the second issue is just as impossible to fix as the first: If the Fed is to buy less securities, then by how much, and how quickly should this be done?

They could simply stop making purchases overnight, or use the Philadelphia Fed president’s proposed plan of a slow reduction in purchases, despite no one being able to explain why $10 billion a month is preferred to $20 or $30 trillion. All methods are equally valid, as they are based on nothing more than the whimsical nature of the central planner; thus, all decisions of the planner remain, in effect, “right.” Until central planners are removed, society will have no other choice but to live under the market conditions the planners believe best suited for us.

We are sadly reminded that a handful of experts have the power to make billion-dollar decisions based on nothing more than guesswork or a gut feeling at best, or for self-serving and possibly nefarious means at the very worst. In the case of the Fed’s tapering, according to the president, there need not be any basis other than the belief that it seems like a “a reasonable thing to do,” right?

When commenting, please post a concise, civil, and informative comment. Full comment policy here

It’s Saigon in Afghanistan

07/06/2021Ron Paul

The end of the 20-year US war on Afghanistan was predictable: no one has conquered Afghanistan, and Washington was as foolish as Moscow in the 1970s for trying. Now, US troops are rushing out of the country as fast as they can, having just evacuated the symbol of the US occupation of Afghanistan, Bagram Air Base.

While perhaps not as dramatic as the “Fall of Saigon” in 1975, where US military helicopters scrambled to evacuate personnel from the roof of the US Embassy, the lesson remains the same and remains unlearned: attempting to occupy, control, and remake a foreign country into Washington’s image of the United States will never work. This is true no matter how much money is spent and how many lives are snuffed out.

In Afghanistan, no sooner are US troops vacating an area than Taliban fighters swoop in and take over. The Afghan army seems to be more or less melting away. This weekend the Taliban took control of a key district in the Kandahar Province, as Afghan soldiers disappeared after some fighting.

The US is estimated to have spent nearly 100 billion dollars training the Afghan army and police force. The real number is likely several times higher. For all that money and 20 years of training, the Afghan army cannot do its job. That’s either quite a statement about the quality of the training, the quality of the Afghan army, or some combination of the two.

Whatever the case, I am sure I am not the only American wondering whether we can get a refund. The product is clearly faulty.

Speaking of money wasted, in April, Brown University’s Cost of War Project calculated the total cost of the Afghanistan war at more than two trillion dollars. That means millions of Americans have been made poorer for a predictably failed project. It also means that thousands of the well-connected contractors and companies that lurk around the US Capitol Beltway pushing war have become much, much richer.

That’s US foreign policy in a nutshell: taking money from middle-class Americans and transferring it to the elites of the US military and foreign policy establishment. It’s welfare for the rich.

Reprinted with permission.

When commenting, please post a concise, civil, and informative comment. Full comment policy here

More Details on Fedcoin

07/06/2021Robert Aro

The path to the Federal Reserve’s central bank digital currency (CBDC), or Fedcoin, continues to be played out before the public. This time, Fed vice chair for supervision Randal K. Quarles gave a speech Monday sharing his general ideas. His conclusions are interesting:

First, the U.S. dollar payment system is very good, and it is getting better. Second, the potential benefits of a Federal Reserve CBDC are unclear. Third, developing a CBDC could, I believe, pose considerable risks.

However, the benefits of a new technology being unclear or the high risks never stopped the development of technology before. He goes on to say:

Even if other central banks issue successful CBDCs, we cannot assume that the Federal Reserve should issue a CBDC. The process that Chair Powell recently announced is a genuinely open process without a foregone conclusion.

While he seems sincere when noting the risk, it’s unlikely that a future would exist where other central banks would have a CBDC but the Fed would not. Whether central bankers make it appear as though a debate is ongoing, the public should be prepared that one day, given the inevitable progress of technology and general fear of missing out, one day there will be a Fedcoin.

The question remains: What will Fedcoin look like? So far, not good.

Vice Chair Quarles foreshadows things to come, providing a few ways the coin could be used:

One is an account-based model, in which the Federal Reserve would provide individual accounts directly to the general public. Like the accounts that the Federal Reserve currently provides to financial institutions, an account holder would send and receive funds by debit or credit to their Federal Reserve account.

Consider a future where you could deposit and withdraw funds at your local Federal Reserve branch. It would put the consumer one step closer to the newly created money, skipping their local bank entirely! Whether it would function through direct payments from the Fed to the public or the individual would be able to borrow funds from the Fed has yet to be seen.

He also mentions:

A different CBDC model could involve a CBDC that is not maintained in Federal Reserve accounts. This form of CBDC would be closer to a digital equivalent of cash. Like cash, it would represent a claim against the Federal Reserve, but it could potentially be transferred from person to person (like a banknote) or through intermediaries.

Under this method, it seems as though they would create a parallel US dollar to circulate digitally …

It’s all quite fantastic! The supervisor even admits:

I am skeptical that the Federal Reserve has legal authority to pursue either of these CBDC models without legislation. Nevertheless, the recent clamor over CBDCs makes it appropriate to explore the benefits, costs, and practicalities of implementing one in the United States if such legislative authority were granted. 

The problem, for all that can be debated, contemplated, and discussed in the public eye, is the uncertainty. Technology has a way of progressing and legislation changes to suit the government’s needs. While no one has formally detailed how exactly Fedcoin will function in society, we know it’s only a matter of time until it does; when that comes, further increases to the money supply, and more government control over the supply of money will come with it.

When commenting, please post a concise, civil, and informative comment. Full comment policy here

An Italian Translation of "A Brief History of Secession Referenda in Europe"

My thanks to Carlo Lottieri for publishing an Italian translation of "A Brief History of Secession Referenda in Europe" in the publicationL'indro: "Breve storia dei referendum sulla secessione":

La Scozia non ha ancora rinunciato all’idea di tenere, nei prossimi anni, un altro referendum sull’indipendenza. Anche se Londra si oppone, è da rilevare che il dibattito sulla secessione scozzese non riguarda se un voto su tale questione sia morale oppure se sia legale. Piuttosto, la questione è se tale voto sia prudente o quanto meno in questo momento.

Tutto ciò è abbastanza diverso da quanto avviene nella politica americana, dove qualsiasi ipotesi di indipendenza per qualsiasi area degli Stati Uniti -un Paese che non è nemmeno vecchio come l’unione tra Inghilterra e Scozia, la quale dura da trecento anni- è ovviamente considerato illegale ed estraneo a una seria discussione politica.

Read the full article. 

When commenting, please post a concise, civil, and informative comment. Full comment policy here

The Ideology of Victimism

07/01/2021David Gordon

Luke Burgis’s Wanting: The Power of Mimetic Desire in Everyday Life (St. Martin’s Press, 2021) is a popular exposition of the theories of the great French thinker René Girard. The book includes a passage that is of great value in understanding contemporary politics. “Obviously, the defense of victims is a good thing. At the same time, it brings new dangers. In the same way that scapegoating rituals in archaic religions were entirely practical—that is, they were used to achieve practical ends—so too can the defense of victims be used for practical purposes, James G. Williams, in his foreword to one of Girard’s most well-known works, I See Satan Fall Like Lightning, attempted to sum up Girard’s thinking on this point. ‘Victimism uses the ideology of concern for victims to gain political or economic or spiritual power.’ he wrote. ‘One claims victim status as a way of gaining advantage or justifying one’s behavior.’ Victims now have the power to make new scapegoats of their own choosing. An open and honest memory is needed to prevent that power from becoming tyrannical” (pp. 128–29).

When commenting, please post a concise, civil, and informative comment. Full comment policy here

Conspiracy: Theory and Practice

06/30/2021Edward Snowden

The greatest conspiracies are open and notorious—not theories, but practices expressed through law and policy, technology, and finance. Counterintuitively, these conspiracies are more often than not announced in public and with a modicum of pride. They’re dutifully reported in our newspapers; they’re bannered onto the covers of our magazines; updates on their progress are scrolled across our screens—all with such regularity as to render us unable to relate the banality of their methods to the rapacity of their ambitions.

The party in power wants to redraw district lines. The prime interest rate has changed. A free service has been created to host our personal files. These conspiracies order, and disorder, our lives; and yet they can’t compete for attention with digital graffiti about pedophile Satanists in the basement of a DC pizzeria.

This, in sum, is our problem: the truest conspiracies meet with the least opposition.

Or to put it another way, conspiracy practices—the methods by which true conspiracies such as gerrymandering, or the debt industry, or mass surveillance are realized—are almost always overshadowed by conspiracy theories: those malevolent falsehoods that in aggregate can erode civic confidence in the existence of anything certain or verifiable.

In my life, I’ve had enough of both the practice and the theory. In my work for the United States National Security Agency, I was involved with establishing a Top-Secret system intended to access and track the communications of every human being on the planet. And yet after I grew aware of the damage this system was causing—and after I helped to expose that true conspiracy to the press—I couldn’t help but notice that the conspiracies that garnered almost as much attention were those that were demonstrably false: I was, it was claimed, a hand-picked CIA operative sent to infiltrate and embarrass the NSA; my actions were part of an elaborate inter-agency feud. No, said others: my true masters were the Russians, the Chinese, or worse—Facebook. Contrary to what a surprisingly large number of people on Twitter believe, that is very much not me.

es

As I found myself made vulnerable to all manner of Internet fantasy, and interrogated by journalists about my past, about my family background, and about an array of other issues both entirely personal and entirely irrelevant to the matter at hand, there were moments when I wanted to scream: “What is wrong with you people? All you want is intrigue, but an honest-to-God, globe-spanning apparatus of omnipresent surveillance riding in your pocket is not enough? You have to sauce that up?”

It took years—eight years and counting in exile—for me to realize that I was missing the point: we talk about conspiracy theories in order to avoid talking about conspiracy practices, which are often too daunting, too threatening, too total.

Read the full article.

When commenting, please post a concise, civil, and informative comment. Full comment policy here

New York Can't Run an Election. Why Can't Governments Do Their Most Basic Tasks?

06/30/2021Ryan McMaken

New York City held its Democratic primary for mayor last week, and the initial results favored Brooklyn Borough president Eric Adams by a sizable margin.

But now officials say those results aren’t reliable at all and the Board of Elections botched the vote-counting process.

As the Washington Post now reports:

It turns out that the results the city released also included a number of dummy ballots, used to test the system—ballots that should not have been included in the initial count….

It will still be a few weeks before we know who won the primary, given those absentee ballots (which are likely to aid Garcia) need to be counted. 

This is a primary election in a single city, yet based on the level of competence brought to the operation, one would think this were an incredibly complex affair, unknown in the annals of government operations.

(It’s also reminiscent of the botched primary election in Iowa in February 2020, when the Democratic Party had more trouble counting a small number of votes in one of the smallest states in America.)

In the wake of the New York fiasco, not surprisingly, some Americans began to point out that if New York miscounted its votes in a mayoral election, why should we trust that 2020’s presidential election in New York was “secure”?

Perhaps aware of the fact that last week’s election doesn’t look good for the idea of election integrity, the corporate media sprang into action with a plan: blame everything on New York’s board of elections (BOE). This is a New York problem only, we're told. Elections everywhere else in America are in tip-top shape and run by only the highest-quality, most competent people.

To keep up this narrative, the Washington Post today ran an article with the title “New York’s mayoral election is a mess. This doesn’t somehow prove Donald Trump right.”

Now, I don't know if Donald Trump lost due to election fraud, but the idea that elections and election officials are not exactly paragons of efficiency and virtue is plausible, to say the least. Nonetheless, the Post article makes it clear that the BOE is to be thrown under the bus in order to insist that election systems everywhere else are in great shape:

No observer of New York City politics was surprised to learn that the Board of Elections had messed things up. It’s common knowledge the board is at best inept, as a report from the city’s local paper documented in late October. The city’s politics broadly are byzantine and dishonest, often relying on a system of patronage that those in power—generally the system’s beneficiaries—are loath to challenge. It’s an embarrassing situation, but usually one that does its embarrassing thing out of the spotlight of national attention.

Similarly, CNN featured a story today declaring the New York BOE to be “corrupt and incompetent,” with CNN on-screen personality John Avlon insisting in no uncertain terms that the BOE is worthless.

Needless to say, one rarely hears such thundering condemnation of Democrat-controlled institutions at the WaPo or CNN, yet it’s no holds barred at major news outlets today. But it's all necessary to assure the public that New York is the only place in America where election systems are "corrupt and incompetent." 

Governments Continue to Botch Their Core Functions

But even if we leave Donald Trump and the 2020 election out of this, the New York affair should be regarded as just the latest reminder that government institutions increasingly can’t seem to be able to carry out what we’re told are their most basic functions.

We’re told that governments must be in charge of elections; that governments will “keep us safe” by catching criminals and preventing crime; that governments must be in charge of the justice system; that governments must be in charge of the schools.

Yet in all these cases, the competence and success with which government agencies carry out these “core duties” is questionable at best.

The court system is slow, overloaded, and involves long wait times. The multiyear wait times needed to get a hearing for suspected illegal immigrants is just the latest example. The right to a “speedy trial” is apparently not much of a right at all.

Meanwhile, the homicide rate continues to head up to the multidecade highest. Millions of Americans are buying guns because they don’t trust government officials to “keep us safe.” This is true both at the micro and macro levels. In many cities, police devote almost no resources to investigating homicides. And then, of course, there is the American intelligence “community” (i.e., the FBI and the CIA), which allowed 9/11 to happen right under its nose. And don’t forget the fact the US just lost two more wars.

Public schools are almost as unimpressive. The US ranks forty-eighth in math and science education. The US is only in the middle in terms of science and reading. Ninety percent of American schoolchildren attend public schools.

Yet while governments in America can’t seem to pull off these most ordinary tasks, they seem to have plenty of time and resources for investigating middle-aged women who “stormed” the US Capitol on January 6. Last Sunday, the US government bombed Syria and Iran—for reasons that obviously had nothing to do with defending the borders of the nation or the rights of American citizens. America’s governments have plenty of resources to pour into bailouts for wealthy bankers and other corporate friends.

But crime? Elections? Schools? Well, that’s all just much too complicated and governments insist we shouldn’t expect too much of them. After all, they assure us, we stingy taxpayers aren’t willing to cough up as much money as we should. The data says otherwise.

So when New York announces that it just hasn’t yet gotten the hang of this whole “elections thing,” just chalk it up to yet another example of how governments are awash in cash, yet never seem to be able to actually deliver the promised goods.

Image source:
When commenting, please post a concise, civil, and informative comment. Full comment policy here

With Inflation Rising, Can the American Right Learn from El Salvador?

06/29/2021Tho Bishop

El Salvador became the center of the bitcoin world recently with the announcement from President Nayib Bukele that the country will embrace a bitcoin standard. While criticisms may exist about details of this specific proposal, a state actor effectively challenging the dollar-based global monetary regime is a cause for celebration. While it remains to be seen if other countries will attempt to replicate Bukele’s handout to the bitcoin community, there are important lessons here for other political leaders trying to respond to the global uncertainty that has resulted from the Federal Reserve’s reckless abuse of the global reserve currency.

Among those who would benefit from seriously engaging with the question “What has government done to our money?” is the American right.

While the reckless fiscal and monetary policy that has eroded the security of the American dollar is unquestionably bipartisan in nature, the Biden administration may end up being the unfortunate winner of inflationary hot potato. With annual inflation reaching 5 percent, the Federal Reserve will face a level of scrutiny it has not faced in a decade—and inflation is a particularly problematic political hurdle given the daily toll it takes on average consumers. The corporate press will do everything it can to try to gaslight the American public about the costs of inflation, but not even the Communist Party of China has the power to prevent average consumers from feeling the pain of rising consumer prices.

While the Republican Party may look forward to the politically advantageous environment an inflationary environment may provide at the ballot box, ultimately policymakers are going to have to seriously deal with the underlying issue: the absolute failure of the modern PhD standard.

Historically, abuses of a country’s currency have typically resulted in some sort of value peg. In America, both FDR and Richard Nixon ordered a deliberate devaluation of the dollar against a weight of gold—an effective default by the Federal Reserve that no Fed chair wants to acknowledge. Some analysts, such as James Rickards, have mentioned this as a potential remedy for the Fed’s current problem.

Another approach has been to embrace the use of another form of currency restraint, such as a currency board, favored by scholars like Steve Hanke. The problem is that a currency board requires the existence of other stable currencies—and the problems that face the dollar are global in nature. It is precisely the fact that almost all other fiat currencies have followed—or surpassed—the monetary hedonism of the Federal Reserve that has helped maintain its global dominance over the past decade.

This does, however, open up one of the most terrifying outcomes that could emerge: the rise of a globalist-imposed currency. The potential for an instrument such as the IMF’s special drawing rights (SDR)—which have increasingly been used by the International Monetary Fund as a means to bailouts and foreign aid—to be used as a new global reserve currency is an idea that has been discussed since the aftermath of the 2008 financial crisis.

In 2009, the Federal Reserve Bank of Cleveland acknowledged that

persistently bad U.S. economic policy could push people into a new international currency. If foreigners suspected that the costs of holding dollars in terms of lost purchasing power would soon exceed the network benefits of transacting in dollars, they would migrate to an alternative international currency.

It's worth noting that US economic policy has been bad enough that some central bankers have voiced concern that the Fed has abused the dollar's position as a global reserve currency—and not only the usual suspects of China, Russia, or Iran. In 2019, former Bank of England president Mark Carney denounced the dollar as "destabilizing" and called for it to be replaced by a global digital currency. Such a move would also fit neatly with various attempts to engage in a war on cash, and would radically increase the ability of authorities to track and control economic behavior. 

As was the case with Treasury secretary Janet Yellen’s call for a global minimum corporate tax, the natural response by our failed technocratic elite is to further consolidate their power over society. What better way to help them solve the Very Big Issues—like climate change—than to give even more power to those we are told are our intellectual superiors?

Doesn't someone like Christine Lagarde deserve her own saint candle?

Ultimately, if the international populist moment is ultimately about a defense of national sovereignty against globalist institutions, then it is inevitable that the monetary issue will become a defining battle. Just as it has been with the EU and the euro. Should a major global financial crisis undermine confidence in fiat currency, the result will either be the consolidation of power within a globalist institution like the IMF, or a revolutionary shift to private money—such as bitcoin or gold.

Those stakes really couldn't be higher.

If the American right recognizes the significance of this issue, there are steps that can be taken immediately to better prepare red America for the future. Just as economic policy—amplified by differences in covid response—has made red states more attractive than Democrat-controlled ones, proactive state action on the dollar dilemma could greatly benefit their citizens in the face of a flailing failing Fed.

Some have already been leading. Texas, for example, opened a state-backed gold depository with the aim to repatriate Texas-owned gold from the vaults of the Federal Reserve. As Ryan McMaken has noted, a US state getting serious about gold would allow it to effectively secede from the Federal Reserve’s monetary regime.

An alternative approach would be for a state to focus on cryptocurrency, such as bitcoin. An early leader is Wyoming, which has created the most crypto-friendly legal environment in the United States, including allowing state-charted banks to legally hold crypto. Imagine if every Republican-led state implemented Caitlin Long’s work at the state level? Not only would it effectively demonstrate a state-by-state “no confidence” vote against the technocratic frauds at the Fed, but it would significantly undermine any attempt to utilize the empire’s levers of power against bitcoin in the future.

After all, what better lobbyist is there than a senator with laser eyes?

Even if Donald Trump rails against bitcoin, the populist movement he has inspired may be more serious about opposing the technocratic class. Given the stark differences in vaccination rates by political party, it is clear that even Trump’s endorsement isn’t enough to overcome red America's awakened hostility to powerful institutions.

The ability of American politicians to avoid facing any serious consequences for reckless debt and spending has allowed a degree of economic nihilism to dominate the political landscape. What happens when that changes will have a profound impact on human civilization going forward.

As was the case with covid, the residents of the states most skeptical of the federal regime will have a major advantage.

When commenting, please post a concise, civil, and informative comment. Full comment policy here

HMS Defender versus the Russian Military: The Danger of Believing Your Own Propaganda

06/29/2021Ron Paul

Less than two weeks after NATO members reaffirmed allegiance to Article 5—that an attack on one member was an attack on all members—the UK nearly put that pledge to the test. In a shockingly provocative move, the UK’s HMS Defender purposely sailed into Crimean territorial waters on its way to Georgia.

Press reports suggest that there was a dispute between the UK defense and foreign ministries over whether to violate Russia’s claimed territorial waters with a heavily armed warship. According to reports, Prime Minister Boris Johnson himself jumped in to over-rule the more cautious Foreign Office in favor of confrontation.

As Johnson later claimed, because the UK (and the US) does not recognize Russian sovereignty over Crimea, the UK was actually sailing through Ukrainian waters. It was an in-your-face move toward Russia just weeks after the US and NATO were forced to back down from a major clash with Russia in eastern Ukraine

This time, as was the case in eastern Ukraine, the Russians took a different view of the situation. Russian coast guard vessels ordered the HMS Defender to exit Russian territorial waters – an order they punctuated with rare live fire of cannon and dropping of bombs.

Having had their bluff called, the UK government did what all governments do best: it lied. The Russians did not shoot at a UK warship, they claimed. It was a previously-scheduled Russian military exercise in the area.

Unfortunately for the UK government, in its haste to create good propaganda about standing up to Russia, they had a BBC reporter on-board the Defender who spilled the beans: Yes, the Russian military did issue several warnings, yes it did buzz the HMS Defender multiple times, and yes there were shots fired in the Defender’s direction.

Similarly, in the spring, Russia rapidly deployed 75,000 troops on the border with Ukraine in response to a US-backed Ukrainian military build-up. The message was clear: Russia would no longer sit by as the US government and its allies intervened next door.

Russia now has demonstrated that it will protect Crimea, which voted in a 2014 referendum to re-join Russia. The Crimean vote was triggered by the US-backed coup in Ukraine. That is called “unintended consequences” of foreign interventionism.

The problem with the UK, the US, and their NATO allies is that they believe their own propaganda and they act accordingly. A famous 2004 quote attributed to George W. Bush advisor Karl Rove, clearly spelled out this line of thinking. Said Rove, “We're an empire now, and when we act, we create our own reality.”

These two recent near-clashes with Russia demonstrate that the “reality” created by an almost religious belief in American or NATO exceptionalism can often crash hard against the reality of 75,000 troops or the Black Sea Fleet

The anti-Russia propaganda endlessly repeated by both political parties in Washington and amplified by the anti-Trump media for more than four years has completely saturated the Beltway and beyond. Even as the Russiagate conspiracy was proven to be a lie, the propaganda it spawned lives on.

Blustering Boris Johnson almost provoked a major war over an infantile desire to continue poking and prodding Russia in its own backyard. This time the war was averted, but what about next time? Will the adults ever be in charge?

Reprinted with permission.

 
When commenting, please post a concise, civil, and informative comment. Full comment policy here
Shield icon power-market-v2