Power & Market
By now everyone has heard or seen it, the thirty-second video clip having been destined to go viral the moment it happened.
In an understandably rare public speaking event at the George W. Bush Institute at Southern Methodist University, the 43 president made a Freudian slip of almost unimaginable proportions: he admitted to being a war criminal.
The moment came at the end of an extended condemnation of Vladimir Putin, his regime, and his war in Ukraine. It was in his condemnation of the last of these that the younger Bush familiarly stumbled, saying out loud what critics of the Second Iraq War have said all along: criticizing the systemized stealing of elections and repression of critics, Bush indicated his belief that it was this system which had led to “the decision of one man to launch a wholly unjustified and brutal invasion of Iraq.”
“I mean, of Ukraine,” Bush corrected himself.
He gave a laugh and so did the audience.
Bush continued: “Iraq too…Anyway.”
While some in the hypocritical corporate media were quick to express their own disapprobation and condemnation, this in the name of at a war they had screamed for and called traitors everyone who didn’t support it, the rest quietly observed Bush’s humble willingness, after 20 years, to admit that he had been responsible for the unnecessary and criminal deaths of thousands of American soldiers and hundreds of thousands—if not millions—of Iraqis. Together with his disastrous and unnecessary invasion and occupation of Afghanistan—we now know from Donald Rumsfeld’s own papers that the Taliban regime had offered to surrender Osama and itself within weeks of the initial US special operations beginning—the body count Bush Jr. is responsible for is likely some millions, to say nothing of the tens of millions of refugees.
And that is exactly how it looks.
In a country where the politicians are at least nominally carrying out the will of the people, they get to casually mention they destroyed the Middle East under false pretenses to a response of chuckles and collective ethos of “we don’t really care.”
Because it doesn’t matter to them, the political elites. And frankly, to any objective observer it didn’t and doesn’t seem to matter to the great majority of Americans. The American public would have let the war in Afghanistan go on forever, never mentioning the war in their pre-election priorities, and the corporate media collectively going months without even mentioning it. As for Iraq War Two, all the American public really objected to were the American casualties, though this could be attributable to the fact that the corporate media had obediently conjoined the two under the black and white rubric of the War on Terror—which was always an obvious lie, since Sadaam hated and killed every Islamist and Jihadi he could get his hands on.
This isn’t world leadership, not worthy leadership: it is criminal, and Bush has finally made a public acknowledgement of it. However late, however inadequate, it should do.
The path now is clear: charge and hand him over the International Criminal Court at the Hague. That is where war criminals belong - and if we're being completely honest George W. Bush isn't the only living US president of recent memory who should go.
Whatever else it might do—from encouraging Russians to throw Putin in the docket, to keeping Xi patient over Taiwan—it would at least begin the process of trying to account for the great stain upon the nation George W. Bush and the Congresses that abetted him perpetrated during their time in office.
Of course, many of those who voted for the war are still in Congress—or like perma-hawk Hillary Clinton went on to be Secretary of State and the Democratic nominee for president.
And while Bush gave the order and so should take the blame, no one believes for a second that it wasn’t the decision of his advisors, especially his vice president, Dick Cheney. The fact that those same advisors suffered no great personal loss for their deceptions and miscalculations, but sit comfortably in think tanks, or appear on nightly television news broadcasts to tell us how to fix the current crop of messes their policies created in the first place, is a continuing reminder of the failure of the American people to fulfill what democracy says is its most basic function: public accountability.
After the leaking of a draft opinion from the Supreme Court on “Dobbs v. Jackson Women’s Health Organization,” it seems clear that the precedent set in Roe v. Wade and upheld by Planned Parenthood v. Casey is being overturned. In the document, confirmed by Chief Justice Roberts, Justice Alito plainly says that the majority opinion is “that Roe and Casey must be overruled,” and that “It is time to heed the Constitution and return the issue of abortion to the people’s elected representatives.”.
So, what does this mean for Abortion “rights”? Despite what liberal pundits' hysteria makes it look like, this does not mean that abortion is now banned in the entire United States. What it does mean is that the decision on whether it is banned is determined by each state’s government.
Essentially, the power to legislate abortion has been handed from the federal government down to the states in a rare victory for states’ rights. Particularly on an issue that divides Americans more than nearly any other issue.
Forty-nine percent of Americans identify as Pro-Choice and forty-seven percent as Pro-Life. Overall as well, thirty-two percent support abortion being legal in all cases and nineteen percent support abortion being illegal in all cases. Support or lack of it seems correlated to the region the state is in, as Pro-Life states tend to be in the South or Midwest, while pro-choice heavy states are in the Northeast and West coast.
Twenty-three states already have laws that would trigger if the decision is made final that either impose restrictions on abortion they could not previously impose or an outright ban of abortion, all in either the South or Midwest. Conversely, sixteen states have laws that protect the “abortion rights” which are all on the Northeast and West coasts.
The pre-existing divide between more rural, Southern, and Midwestern states and more urban, Northeastern, and West coast states is going to be furthered. The difference in policy, even among states that are generally pro-life or pro-choice, will create a new incentive for people in choosing where they live. One based around a moral issue.
While what set of morals one wants to live under somewhat exists between the states in the varied cultures between them, abortion being a state issue gives an easy signaling device for them. It is a safe assumption that “what is their abortion policy” is a question people will ask when considering where to move.
This is a continuation of the trend of people moving from state to state concentrating certain states on one ideology and culture that is becoming increasingly opposed to other ones. The obvious question that comes from observing this trend is, “Are we going to see secession from this?”
The answer to that question cannot be definitively answered till something happens, but we can draw parallels to the last time the U.S. saw States secede in the Civil War. Historian Alan Taylor describes the U.S. up to 1850 as “built on an unstable foundation of rival regions and an ambiguous Constitution”.
There were many conflicts between the states before the Civil War and even full-on rebellions such as the Whiskey or Shay’s Rebellion. The States only continued the trend of division among themselves leading up to the Civil War culturally, economically, and politically.
Slavery would become the issue that is credited with causing the Civil War, but, while playing a part, was not the only reason, nor does it explain all of the divides between the states. In some states like North Carolina, it was never clear whether the general population even cared about the issue as it was a relatively small slave population state.
Additionally, several Union states kept slavery throughout the war, even after the emancipation proclamation, till it was outlawed by the 13th amendment. Although slavery was not the sole cause of the Civil War, it did become the issue that served as the face of the divide.
Similar conditions do exist today as leading up to the Civil War if you replace the issue of Slavery with the issue of abortion. States before this decision had already been engaged in legal fights with the federal government over abortion. Not only this, several states have made laws to re-enforce “abortion rights” and provide greater access to it.
It is clear that before and now after the leak states are dividing along this line and it is coming to the forefront of the differences between them. Though we can see that many other divides exist between the states that are only being exacerbated, such as COVID 19-policies and approach to the economy.
This provides quite substantial evidence for some kind of situation similar to the Civil War secession or a softer secession such as the USSR. One can only wait, but regardless if such a scenario happens Abortion will be at the forefront of the divide between states for the foreseeable future.
We Can Learn from Disney's Private Property Initiatives Even If We Learn the Wrong Lessons from the Company's Politics
I recently wrote a piece explaining that there is a libertarian case for taking away Disney’s Florida privileges. However, I am writing this to stress that while strategically that is the appropriate approach, we must not throw out the baby with the bathwater.
Granting Disney these special privileges but not to organizations that may have been more amenable to the ideas of liberty is most certainly one step forward and two steps back, but nonetheless the one step forward does warrant some analysis. During its time with these privileges, Disney served as a valuable case study for the concept of a private city.
Part of Disney’s responsibilities in exchange for self-governance was that it was now responsible for its own security. We as Austrians regularly point to the theories of Rothbard and Hoppe as they pertain to the privatization of security, but Disney has given much more concrete evidence of the possibility.
Disney’s private security has permanent Emergency Operations centers, utilizing the same system as law enforcement agencies, and extensive two-way radio systems with more than 1,200 “cast members” employed in security operations. Disney achieves this almost invisibly as the security members are trained to blend in and seem as if they have appeared out of nowhere when they are needed.
Additionally, Disney achieves this at a lower cost than government security. The average police officer is paid between $27 and $32 per hour. Meanwhile, at Disney, the average security guard is paid between $11 and $17 an hour.
However, as Austrians we can recognize that that’s probably much more indicative of the natural price discovered through exchange. And despite paying so much less, Disney maintains equivalent security - if not better security - than just about anywhere else in the world.
Its security team additionally benefits from the fact that Disney has the strictest borders in the country - private borders. This fits exactly in line with what Hoppe has described of private cities:
No one is against immigration and immigrants per se. But immigration must be by invitation only.
And Hoppe goes on to say:
In a fully privatized libertarian order, there exists no such thing as a right to free immigration. Private property implies borders and the owner’s right to exclude at will.
This is exactly the position in which we find Disney. Disney’s borders had little to no discrimination. All that is required to receive the invitation that Hoppe insisted private borders is a payment of a little over one hundred dollars. With it came not only admission through the border but access to all the amenities their private city had to offer.
But from a security standpoint, Disney was able to screen every single resident (employee) and visitor of its private city. In their screening they even retrieve fingerprints, names, and contact information. This also allowed for more peaceful security at Disney because rather than having to resort to violence like a government security officer would, Disney security has the ability to simply remove from the premises those who had breached their rules.
For the sake of brevity, we cannot analyze every single benefit of the private city that is Disney World, but it is worth noting that it was not even close to limited to the benefits of private security enhanced by private borders. Disney’s famous Monorail served as just one of their private city’s answers to public transportation.
Disney has been responsible for its own sanitation and is - while not perfect - indisputably cleaner than any city of its size. Disney has its own fire department that has been exceedingly successful. Disney’s hurricane preparedness programs have led to it being named a StormReady® community. All this coupled with dozens of other examples that made Disney’s private community either competitive with or significantly better than any government run city.
Again, I stress that Florida was right to take away these privileges as they only catered to those who were enemies of further privatization and thus likely to detract from these benefits spreading. As a result, these benefits are not helpful in the long term when they are only allocated to organizations like Disney. However, I reiterate that we must not throw the baby out with the bath water as it is so important that we learn from and use the invaluable case study that is Disney and its private city.
Washington D.C., home of the monumental overreaction, is at it again, this time threatening China and the Solomon Islands over a security agreement negotiated between the two.
Forget the fact that 99 percent of Americans couldn’t point out the Solomon Islands on a map, or that we have dozens of military bases and installations in the region, some our Australian allies say we may need to preemptively invade – that according to David Llewellyn-Smith.
The truth is there is no justification for assuming US and Australian prerogatives trump those of all other states. Trade between China and the island nation is almost 100 times that between the US and the Solomons. Thousands of Chinese live or work in the Solomon Islands, and Chinese capital and businesses have proliferated in the past two decades. Though it isn’t reported in the mainstream western media, anti-Chinese riots on the islands have periodically resulted in the destruction of Chinese business and attacks on its citizens – most recently in 2021.
It is worth pausing here to reflect on how Washington might have reacted under similar circumstances. It seems unlikely its actions would have stopped with diplomatic complaints and an eventually negotiated arrangement for a Chinese police presence to protect its citizens and their property.
More likely, an aircraft carrier battle group would have been dispatched and the matter settled unilaterally.
Apart from the fact Washington’s intemperate response is likely to alienate key regional fence-sitters like the Philippines, India, and Indonesia, it also lays bare the obvious emptiness of U.S. and western rhetoric about the right of states to choose their own security policies and the inviolability of borders.
Grumbling in the developing world, including among the other BRICS countries, about the U.S. provoking Russia into a rational if unreasonable response to threats to its security are growing – something even mainstream hawkish outlets like the Economist acknowledge. Seeking to draw more black and white lines over distant security concerns is likely to continue this trend of alienating states clearly seeking non-alignment in Cold War Two.
As usual, in its reaction to the Solomon Islands’ agreement with Beijing, Washington is damaging America’s foreign relations and our national security, misconstruing the nature of the agreement and stoking domestic anti-Chinese sentiment. Of course, many Americans died in retaking the islands from the Japanese during the Second World War. And their sacrifice was tremendous, but that isn’t why Washington is acting belligerent.
Just as in the case of Ukraine, so-called “Great Power Competition,” a euphemism for the strong fighting over which of the weak each will lord it over, is to blame for this new threat to global security. Meanwhile, “whataboutism” is a rhetorical device meant to prevent our critically thinking about these policies or their context.
But these insane policies have to stop. Confrontation everywhere, anywhere, for anything and everything, with no sense of proportion is going to lead only to disaster both at home and abroad. We should not, as long-time hawk Robert Kagen suggests in Foreign Affairs, fight the Russians and Chinese over anything and everything; but rather, as Eliot A Cohen recommends, by returning to history, to statecraft, to accepting other states can be permitted to act without oversight from Washington.
The small and beautiful island of Sri Lanka is often eclipsed by discussions surrounding its richer, strategically more important, and dimensionally bigger northern neighbor, India. Recently, the island has been battling an unprecedented economic crisis of an alarming magnitude. While it is true that this crisis could have catapulted the island into international limelight, the current Russia-Ukraine hostilities have foreshadowed the plight of Sri Lankans facing relentless power cuts, fuel shortages, and endless hunger.
In this article, I attempt to succinctly break down the Sri Lankan Economic Crisis for western audiences that may need political and historical context to fully understand the gravity of what is transpiring on this small island.
Sri Lanka was a British colony that gained independence in 1948, albeit as a British Dominion, a status it was not able to shed until 1972, when it became a republic and changed its name from Ceylon to Sri Lanka. Despite electing the world’s first female Prime Minister, Sirimavo Bandaranaike, in 1960, Sri Lanka failed to expand its progressive politics to all realms of governance, disenfranchising the ethnic Tamil minority immediately after its independence in 1948.
Some 700,000 Tamils of Indian origin in Sri Lanka had been rendered stateless after the passing of a citizenship law in 1956 by the Ceylon Parliament. This was followed by mass “deportation” of Sri Lankan Tamils to India and ethnically harsh acts erasing the Tamil language and identity from other offices and governmental institutions.
The infamous, inhumane, and sanguineous Sri Lankan Civil War was a product of armed Tamil resistance that witnessed terrorist acts by LTTE, a separatist group, and the commission of war crimes by the Sri Lankan army. The war claimed about 100,000 lives and displaced close to a million. Anyway, in pursuit of unattainable historical thoroughness, I digress.
Current Politics and Crisis
Sri Lanka has been governed by the Rajapaksa brothers since 2019 in their current spell of governance. This temporal specification is relevant here since it is worth noting that Mahinda Rajapaksa, the current Prime Minister of Sri Lanka, served as the president of the country from 2005 to 2015, when he lost the presidency to Maithripala Sirisena, who was replaced in 2019 by Gotabaya Rajapaksa, Mahinda’s brother, as President. As glaringly nepotist as this development of events sounds, Sri Lankans had learned to live with their government until the current economic crisis.
Many experts attribute the immediate origins of the current economic crisis to the hit weathered by the tourism industry in the country, which has traditionally produced the third largest chunk of foreign exchange income by sector. Following an extremist attack during Easter in April 2019 which claimed about 270 lives, the country witnessed a sharp decline in tourist traffic, a chain of misfortunes worsened drastically by the COVID-19 pandemic, which devastated the economy, forcing it into a recession.
The crippling of the tourism industry was consequently followed by international credit rating agencies downgrading Sri Lanka’s ratings, making it impossible for the country to borrow money from international sources through bonds and other channels. This set into motion the steep downfall of Sri Lankan foreign reserves, which stands out as perhaps the sorest manifestation of the current crisis.
To understand how dwindling foreign reserves affect domestic economic conditions, and above all, the legitimacy of the current economic regime, one could regard the current discrepancy between the reserves and the debt obligations that Sri Lanka currently has. While the country has $2 billion in foreign reserves, it owes $7 billion this year, with $1 billion in bonds maturing in July. As the government inches closer toward a sovereign bond default, the prices of Sri Lankan sovereign bonds descend further, with the current risk premium associated with the bond being a whopping 28.36 percentage points.
Involvement of Foreign Actors
Chinese diplomacy traps and preying strategies have also added to the country’s woes. For the last two decades, Sri Lanka has received about $12 billion from China in infrastructure investments and been forced to give up as collateral to its ambitious creditor the strategic Hambantota port, which is intended by China as a major stop on the New Silk Road, officially known as the Belt and Road Initiative. Despite its stake in the country, China has refused Sri Lanka’s requests for credit to mitigate the ongoing crisis. On the other hand, India, a major regional rival of China, has forwarded $2.4 billion since January 2022 to its embattled southern neighbor.
Backlash and Protests
Sri Lanka Podujana Peramuna (SLPP), the party led by the Rajapaksa brothers, with Gotabaya Rajapaksa at the helm as the current president of the country, has lost over 40 Members of Parliament over this crisis. The entire cabinet has resigned except for the President and the Prime Minister, who are now relying on emergency powers to curb protests all over the country which are drawing Sri Lankans of all ages, classes, ethnicities, religions, and genders. The opposition leaders have demanded resignations from the Rajapaksa brothers as people stand in lines for hours for fuel, milk, and grains.
A major reason behind fuel shortages and the subsequent lack of basic items such as paper and milk is the inability of the country to import fuel, which it does not produce domestically. Not only does Sri Lanka lack the required foreign reserves, but the country has also devalued its currency in a bid to make its exports attractive and make a case before the IMF for a loan. After a 15 percent devaluation in the Sri Lankan Rupee, the state-run Ceylon Petroleum Corporation faces bankruptcy and owes US$3.3 billion to foreign entities.
As a country that is running a trade deficit, facing backbreaking inflation, battling an unprecedented economic crisis, and governed by a regime that lacks the faith of the people, Sri Lanka is witnessing a crucial time in its history. With 22 million people and no major resources or commodities featuring in its top exports, it is no wonder Sri Lankans are hungry, anxious, furious, and out on the streets marching toward Gotabaya’s home. That the primary export of the country is tea and the primary import refined petroleum indicates the gravity of this inflation-trade deficit-debt triangle.
The International Monetary Fund and India are two immediate actors who can help alleviate the pain of this economic crisis, but if the problem is truly as structural as the ongoing protests reveal, it is doubtful how much help loans will provide without proper domestic channels. Sri Lanka needs foreign reserves, fuel, oil, paper, and food, but above all, Sri Lanka needs a change to secure a future.
Next month San Antonians will go to the polls to vote on $1.2 billion in bond proposals. It’s a whopper of a debt-binge that includes funding for unfinished projects authorized by prior bond elections, some of questionable legality, and others representing wasteful jurisdictional overlap.
Also on the ballot will be two constitutional amendments, both aimed at reducing property taxes. The issues are related.
Here in the Alamo City, part of the tax we pay on the investment we put into our homes goes toward paying off that debt. The city’s ability to continue tapping that source is subject to a couple of cross-currents.
One is soaring property appraisals. This allows the municipality to pull in more revenue without raising rates. Unfortunately, they opt to spend this windfall rather than cut rates, or at least raise exemptions.
The state of Texas has been picking up the slack on the latter.
In addition to the ones on the ballot in a few weeks, a couple more exemption-raising constitutional amendments were approved in November. Any reduction in this damaging tax is progress, and it puts citizens on more equitable footing with businesses that get favorable tax treatment.
But only some taxpayers benefit.
To state the obvious, this is unfair, and it increases the burden on the remaining, shrinking tax base, some of whom may eventually say “to heck with this” and move outside city limits. My dad did exactly that when I was a kid.
Our mayor on the other hand, believes this exodus is happening due to a lack of “affordable housing,” and prospective homebuyers “losing … bidding wars … to outside investors.”
The fact is, those investors are looking for safer assets as a result of poor monetary policy in Washington D.C.
The City Council practically salivates at the opportunity to take advantage of this, and other federal largesse, to spend on their pet projects. However, they can’t bring themselves to modestly raise exemptions on property taxes without the state compelling them to?
During the last effort to raise exemptions a year ago, one councilman said the savings to homeowners of the proposed hike would be “meaningless.” I agree. That’s why the entire scheme should be eliminated.
The reaction of most politicians, regardless of jurisdiction or political party, is typically “but how will we fill the revenue hole in the budget?” Whether that’s due to lack of respect for citizens, envy or ignorance is anyone’s guess.
I tend to give them the benefit of the doubt that they just don’t know any better.
For one, taxpayers will not simply stuff the reclaimed $400+ million in tax seizures under the mattress. They’ll inevitably go shopping, thereby pumping up sales tax revenue. Or even better, some might use it to launch a business venture, hiring more sales tax-paying employees.
Maybe in addition to appealing to residents to “buy local,” our elected representatives should also urge them to “invest local.” Economic prosperity is supply-driven, not demand-driven.
They could also show more respect to enterprising individuals and businesses by eliminating city programs that are better- and/or already handled by these folks. As it is, they appear to have more faith in their ability to spend taxpayer money than they do in that of the taxpayers’ themselves.
For example, rather than expanding control and increasing subsidization of “food access” programs, how about removing obstacles to its development, and selling plots of city-owned land to urban farmers?
Members of council who have owned a business should know all of this. If not, they’re more prone to cronyism.
If all this is a bridge too far for their ego, they could just add another percentage or two to the city’s sales tax rate. If they agree with the aforementioned councilman’s sentiment, one would assume they’d feel the same about consumers paying a few more dollars for another T.V.
If citizens are serious about stopping municipal versions of federal omnibus spending bills, it is critical to also demand the elimination of this coercive tax. It would bump up the GDP portion of our state-high debt/GDP, which itself calls into question how much more we can take on with a handicapped ability to pay for it.
Shifting to the most efficient form of taxation would force the city to depend on the health of the economy for its spending, rather than on devalued dollars. It would have more incentive to clear excessively burdensome hurdles to commercial activity.
Otherwise, they can count on us wasting valuable time protesting appraisals, putting on workshops to teach others how to do the same, numbing ourselves to it all by outsourcing the escrow process to our mortgage lenders, etc.
Next month, citizens can put a stop to the city borrowing like a teenager who stole his parents’ credit card. We should also put them in a timeout until they stop plundering our bank accounts
Since Donald Trump was elected in 2016, populist currents have swept across the American Right. The failed nation-building enterprises launched by the Bush administration and continued by the succeeding Obama administration sowed the seeds for a non-interventionist reaction on the Right.
Throughout modern American political history there has existed a significant anti-interventionist bloc within the Right. From the Old Right to the presidential campaigns of former Congressman Ron Paul, non-interventionism has been able to assert itself in the political arena throughout multiple times in American history.
The consolidation of the national security state at the start of the Cold War and the rise of neoconservatives in the twilight years of the Cold War witnessed the Republican Party go from a relatively restrained party on foreign affairs to a thoroughly interventionist party. Despite interventionist outlooks dominating the GOP, Republican leaders still have not been able to fully suppress anti-war sentiments within the party. Since the end of the Cold War, various anti-interventionist movements tried to upend the interventionist faction that dominated the Republican Party.
Pat Buchanan’s presidential runs in the 1990s were the first signs of anti-interventionist sentiments being alive and well among America’s right-leaning electorate. Though any prospect of foreign policy retrenchment grinded to a halt after the 9/11 attacks created a rally round’ the flag effect that brought Americans together. At that point, Americans were primed them for a long-term occupation in Afghanistan and the subsequent invasion of Iraq.
However, once the nation-building projects went astray, a resurgence of anti-war sentiments took off. With then-Congressman Ron Paul running under the Republican banner in the 2008 and 2012 presidential cycles, non-interventionist thought re-entered mainstream political debates. While Paul’s campaigns turned out to be unsuccessful when it came down to votes, the former congress member left his mark on foreign policy discourse on the Right, which was apparent during the 2016 presidential cycle.
The presidential primaries of that election cycle witnessed the most fervent hawks Sen. Marco Rubio (R-FL) and former Florida Governor Jeb Bush get outclassed by Donald Trump during the debates. Throughout his presidential run, Trump made a series of statements that made the neoconservative gatekeepers in the Republican Party uncomfortable — from declaring that George W. Bush lied about the presence of weapons of mass destruction in Iraq to describing NATO as “obsolete”.
As for his presidency, Trump was a mixed bag on foreign policy. All things considered, his administration did little to diminish the national security state’s power. This was on display with Trump’s neoconservative hires such as Secretary of State Mike Pompeo, National Security Adviser John Bolton, and US Special Representative Elliott Abrams. Moreover, defense spending always went up under Trump’s watch.
To Trump’s credit, he did not start any new wars. However, under the Biden Administration, the US looks like it is sleepwalking into a military conflict with Russia over its invasion of Ukraine. The Biden administration’s imposition of sanctions and deployment of military aid are hostile actions that risk a conflagration between nuclear powers.
Post-Trump, there’s talk about a “realignment” taking place within the Republican Party. Since Trump was elected in 2016, America’s working class base has largely drifted to the Right — a secular trend across the West. In the American context, the new working-class constituency is not as gung-ho about embarking on foreign adventures as the average viewer of Sean Hannity.
At first, some Republicans of the national conservative variety started to take note of this electoral shift. talk about ending some of America’s perpetual wars. Freshman Sen. Josh Hawley (R-MO) has previously sounded off about the flaws of American foreign policy, calling for the US to reconsider its “endless wars” and “metastasizing commitments.” Whatever restrained foreign policy inclinations Hawley may have had, have largely dissipated during the Russo-Ukrainian conflict when he called for increased military aid to Ukraine.
Another “populist” all-star like Sen. Tom Cotton (R-AR) is always looking for a scuffle with the likes of China, Iran, and Russia. In the last country’s case, Cotton has been vocal about arming Ukraine to the teeth in an effort to draw Russia into a military quagmire.
On legislation that dealt with a ban on Russian oil imports, 17 members of the US House, which included 15 Republicans, voted against this bill. Similarly, only eight House members, all Republicans, voted against legislation that removed Russia’s “most favored nation” status in the World Trade Organization, thereby enabling the Biden administration to enact stiff tariffs against Russia. While libertarian Republicans like Thomas Massie (R-KY) no longer worry about voting alone on controversial foreign policy issues, the Republican Party remains largely on the same page as Democrats on matters concerning the warfare state.
The present configuration of the Republican Party and the way it has responded to the Russo-Ukrainian conflict showcases how thoroughly embedded pro-war sentiments are among Republican leaders. But there is some hope at the state level for populist-minded movements to score wins against the warfare state. “Defend the Guard” legislation, which is designed to prevent state National Guard units from being deployed abroad unless Congress issues a formal war declaration as outlined by the US Constitution, has been introduced in states such as Idaho, Oklahoma, and West Virginia over the past two years. In the short-term, this may be the most practical step for non-interventionists to push back against the interventionist uniparty.
At a time when political inertia is the norm, pressure from below is the force that will smash the shackles of political stagnation and enable disruptive forces to shake things up in American politics. From there, policymakers will be compelled to rethink many of their positions that have greatly harmed the US.
It seems strange, but not surprising, how many of the economic problems the nation is facing today have already been experienced in the not-too-distant past. High (price) inflation, rising interest rates, and a recession are all hallmarks of the early ‘80’s, with many of the economic woes being caused and purportedly solved by the Federal Reserve. Over 40 years later, these similar news headlines continue to appear month after month, as CNBC had on Thursday:
The Fed’s preferred inflation gauge rose 5.4% in February, the highest since 1983
It’s not even shocking at this point. It’s fair to say most people are no longer waiting for prices to come down anytime soon, even though that’s what was initially promised.
There are also ongoing reports on social media, anecdotal stories, and the odd news story of supply shortages, long lines at gas stations, and even talk of price controls. It’s not just in America. South of the border, Mexico’s President announced:
We've been able to control inflation, stop it from getting totally out of control by managing fuel prices, and we'll do the same in the case of foods if inflation is prolonged, or if it stays high.
Also strange, according to Reuters, Mexico has an inflation target of 3%, but inflation has been running over 7%. Their President claims they’re controlling inflation, but they’re clearly not. Yet American central planners can hardly be regarded any differently.
CBS reports prescription drug costs are on the rise, forcing US Congress to cap:
…the monthly cost of insulin at $35 for insured patients, part of an election-year push by Democrats for price curbs on prescription drugs at a time of rising inflation.
If price controls aren’t enough to fight inflation, our planners will use the rate raising path, similar to what was tried in the ‘80’s. As CNBC explains:
Now the expectation is that the central bank may raise rates by a half percentage point at each of its May and June meetings.
Putting it all together, we have high prices, supply shortages, and the feeling that with each passing day the public is becoming more aware that the dollar is losing its purchasing power. Combine this with talk of price controls and central bank tightening, it starts sounding very much like the Paul Volcker era of the early ‘80’s.
Of all things repeating themselves, the last piece of the puzzle still waits to emerge: The Double-Dip Recession.
Forbes provides an historical account:
- Recession. In January 1980, the U.S. economy fell into a recession that lasted six months.
- Expansion. In July 1980, growth turned positive once again, and the economy remained in an expansion that lasted 12 months.
- Recession. One year later, in July 1981, the economy once again fell into a severe recession, this time lasting 16 months.
The article goes on to say that both recessions “were caused by policy decisions made by the Federal Reserve.”
No one will know when the next recession hits, while it will only be reported many months after the fact; however, an inverted yield curve has normally been a tell-tale sign of a looming recession. One expert on CNBC noted that when the yield curve inverts:
…there has been a better than two-thirds chance of a recession at some point in the next year and a greater than 98% chance of a recession at some point in the next two years…
Here is the part where readers are told that the 10-year minus the 2-year Treasury yield has finally inverted. As of April 1, the yield curve stood at negative 0.06, being the first time this has happened since 2019. With that, it becomes quite possible that the next recession is on the horizon. Not that history should, or must repeat itself, but much of what has transpired in the last two years closely resembles the early ‘80’s. Unfortunately, our future may be fixed, and one more recession starts sounding like the next economic result caused by a series of government and central bank missteps.
Journalist, historical analyst, and conspiracy theorist Mathew Erhet joined Whitney Webb’s Unlimited Hangout podcast titled “Fabians and Fascists”. Erhet made several extraordinary claims, many of which I found intriguing and planned to verify later. I was impressed with Erhet as he was quite articulate and pulled “facts” from a seemingly endless memory bank. However, the following comment caused me to reassess my initial impression:
Even Friedrich von Hayek, who’s a big Austrian school Libertarian known for protecting individual liberty and freedom, in the end of his Road to Serfdom he even says, ‘We need to have a world government police to make sure that all the local regions of the world all play by the same rules of the game.’ So it’s like there’s something fishy going on regarding how these guys are talking about local freedom or personal liberty and stuff. There’s a sleight of hand happening here.
Ehret is suggesting that Hayek is a double agent secretly working to further the Fabian Society agenda of establishing a global authoritative technocracy with eugenics and depopulation aims. Have I been duped? Were Hayek’s many works and thoughtfully crafted ideas on the fundamental importance of civil liberties all part of an elaborate ploy? By arming millions of readers with persuasive arguments against State power, was he secretly building the framework for a worldwide police state?
The idea that a renowned literary work could be propaganda is not inherently absurd. There’s a theory that Alexander Hamilton’s Federalist Papers were just that, and it’s a compelling theory when you consider Hamilton’s abusive, corrupt, and borderline tyrannical actions once he came into power thereafter as these actions were in direct contradiction with values espoused in the Papers. For specifics on this, I recommend Patrick Newman’s book Cronyism. Unlike Hamilton, however, Hayek’s beliefs and his activism in pursuit of them remained consistent until his death.
This characterization of Hayek is frivolous to say the least. Ehret’s claim that Hayek supported a “world government police” is contradicted in the very chapter which he’s misquoting. In these excerpts, Hayek states the only practical way to implement an international body would be through “federation” - the old definition of which means “union by agreement” meaning membership is voluntary. He then outwardly critiques the League of Nations for its attempt to govern the entire world (opposed to neighboring blocs):
The form of international government under which certain strictly defined powers are transferred to an international authority, while in all other respects the individual countries remain responsible for their internal affairs, is, of course, that of federation. (Pg. 232)
There will probably exist a strong tendency to make any new international organization all-comprehensive and world-wide… such ambitions were at the root of the weakness of the League of Nations. (Pg. 235)
Ehret’s implication that Hayek is in cahoots with the Fabians and his claim that Hayek wanted “to make sure that all the local regions of the world all play by the same rules” are both contradicted (in the same chapter), where he criticizes Fabians specifically for their treatment of small countries:
It is significant that the most passionate advocates of a centrally directed economic New Order for Europe should display, like their Fabian and German prototypes, the most complete disregard of the individuality and of the rights of small nations. (Pg. 231)
Hayek critiques Fabians for their socialist tendencies throughout the book as well
Painting Hayek as some sort of technocrat - advocate for government by an elite class of technical experts - is also directly contradicted (you guessed it… in the same chapter). Here Hayek claims the fundamental justification for technocracy rests on a fallacy:
The belief that this is a practical solution rests on the fallacy that economic planning is merely a technical task, which can be solved in a strictly objective manner by experts, and that the really vital things would still be left in the hands of the political authorities. (Pg. 229)
I messaged Matthew on LinkedIn in hopes to reason with him but was met with a few more incorrect claims about Hayek:
Those two quotes which call for abolishing economic planning on national or international levels is absurd considering he had no excuse to support international standard making and enforcing organisations like the League of Nations which many living statesmen at the time understood as an oligarchical operation to destroy the nation state system. Additionally his entire worldview that all planning =totalitarian fascism is incompetent and is rooted in basic British Hobbesian liberalism that denies principles of truth and locks in the definition of humanity into beastial selfish creatures in our fundamental essence.
As noted above, Hayek was explicit in his opposition to the League of Nations, so to say he supports its enforcement is blatantly false.
Hayek does not claim that “all planning = totalitarian fascism”. Hayek himself stated in 1976, “It has frequently been alleged that I have contended that any movement in the direction of socialism is bound to lead to totalitarianism. Even though this danger exists, this is not what the book says.”
I’ll let the reader decide whether Libertarianism is “incompetent” and if it “denies principles of truth”. Given that it was the dominant philosophy leading up to the American Revolution and industrial boom of the 19th century… I’m not sold on this claim.
I recommend that everyone read The Road to Serfdom and decide for themselves. The teachings of Hayek have the potential to bring enormous benefit to humanity. It pains me to think of the hundreds of thousands of Whitney Webb followers who may now approach Hayek’s work with a preconceived cynicism. I’m all for exposing historical figures who are wrongfully celebrated - Hamilton (war debt insider trading), Lincoln (suspending habeas corpus) , FDR (potential prior knowledge of Pearl Harbor)- but one needs more than paranoid machinations to accomplish this. Advice for Matthew Erhet: be prepared to back extraordinary claims with extraordinary evidence.
March 23, 2020 was one of the greatest stock market buying opportunities of all-time. CNBC gives an account of the event:
The S&P 500 would not bottom until March 23, a week later. From the Feb. 19, 2020, high to the March 23 bottom, the S&P would decline about 34%.
Five months later, as if moved by some Miraculous Monetary Technique:
Then, almost as quickly, the market reversed. By August, the S&P was back to its old highs.
The market hit all-time highs less than two years after the 2020 low. A person could have practically bought any stock on March 23, 2020 and been guaranteed to double their money… at least.
If one had the money and knew an upward trajectory was to soon follow, they could have made a fortune; if only it were that easy… or was it?
On March 23, 2020, the New York Fed released the following announcement:
…the Desk has updated its plans regarding purchases of Treasury securities and agency MBS during the week of March 23, 2020. Specifically, the Desk plans to conduct operations totaling approximately $75 billion of Treasury securities and approximately $50 billion of agency MBS each business day this week…
Should anyone have missed the NY Fed’s inflationary idea, the Federal Reserve had a news release with the following headline on the same day:
Federal Reserve announces extensive new measures to support the economy
The March 23, 2020 release included several Fed/Congress money creation schemes, like buying debt from publicly traded companies, as well as an explicit reminder that a week prior, on March 15, 2020, the Fed:
will increase its holdings of Treasury securities by at least $500 billion and its holdings of agency mortgage-backed securities by at least $200 billion.
The data came in the following year. It was declared that the COVID Recession lasted only two months, ending the week after the Fed’s March Monetary-Madness of nearly a trillion dollars in promises to increase the money supply:
According to the National Bureau of Economic Research, the contraction lasted just two months, from February 2020 to the following April.
Is there anything to learn from this?
There is no need to pretend Fed asset purchases had nothing to do with the increase in asset prices, and as we now see, the prices of most goods and services. Serious consideration must be given to the act of purchasing $120 billion a month worth of government and mortgage debt for two years and the astronomical rise in the stock market. To say: “Correlation does not equal causation,” skirts the point and is insincere at best.
Without the Fed’s almost $5 trillion support, it would have been incumbent upon the private sector, or another nation, to purchase America’s debt. Even, if possible, to say the private sector would accept this debt at rates approaching zero percent is a difficult position to hold. If this were the case, the Fed would be irrelevant.
The point to keep in mind is the relationship between money supply and prices. Rather than looking for a sign of the top, one can look for signs of the bottom, the idea being that it becomes extremely difficult for stocks to decline when the Federal Reserve is in the market. With the Fed promising to exit the market within several months, we should start wondering how much sand is left in the hourglass.
Whether it’s this year, the next, or some time beyond, there will be an event, such as the return of COVID, WW3, the next Lehman Brothers, anything really, to blame for the next stock market crash. Eventually, the Fed will find a reason to officially re-enter the market. They will not say it’s for the purpose of saving the stock market. They’ll use words like liquidity crisis, or cite the necessity of a smooth and functioning market. When this happens, the Fed will justify expanding its balance sheet once again. This article does not constitute investment advice, but this is the kind of dip the author is preparing to buy, backed by the full faith and credit of the United States Government and its central bank.