When I was in college I can remember a particularly alcohol soaked evening in which I was debating politics with the kid who lived across the hall from me in my dorm. This was typical for us as we both liked beer, politics, and arguing our wildly divergent political perspectives. On this particular night we were discussing the ins and outs of a movie we both loved, Easy Rider.
David, my friend from across the hall, said that Easy Rider was his favorite movie. It was and is one of my favorites also. I asked him though how he could be such a liberal, I think the term I used was “prick”, and like this movie. He looked at me like the transistors in my brain were misfiring, which after 5 beers they clearly were.
“Are you nuts? Easy Rider is the ultimate lefty movie.” He said. “Drugs, long hair, a commune, open promiscuity, red necks acting like idiots. Easy Rider was a call to joints for an entire generation of lefties.”
Of course he was right; it was a lefty movie for the time. But being the conservative, I think the term David used was “prick,” I was at the time I argued my case anyway.
“Ok,” I said. “All good points. But what was the drug they smuggled into the US from Mexico? Cocaine- the ultimate yuppie party drug. Wall Street’s drug of choice, or at least was, though granted a decade later.”
“What are they riding? Indian motor cycles. How many bikers do you know with Teddy Kennedy bumper stickers on their helmets? Not many. Bikers generally skew right.”
“And the commune scene? Ok so they are dropping acid while tilling the ground but they are basically homesteading, a pretty conservative act.”
“What about arguably the most important scene in the movie when Jack Nicholson makes the case that most people fear individual freedom and that despite what people say free individuals are seen as the enemy by much of America. Hardly seems a liberal collectivist argument.”
And we went back and forth till the beer ran out. In the end we agreed that despite my very good arguments, Easy Rider was definitely not a conservative movie. But he conceded that it wasn’t really a liberal movie in the modern sense either. These guys were way too un-PC for 1990s liberals. They rode Indians for crying out loud.
As I watch Easy Rider again today, having heard that old Denis Hopper is now riding his Indian on the Highway to Heaven (we hope,) it strikes me that the movie is really a libertarian movie. Smoking dope, trying to get rich, riding a motorcycle without a helmet, yep pretty libertarian.
If you are a freedom loving individual, and you have not seen this movie yet, rent it tonight or download it to your computer. It’s a deeply interesting movie and a must for any “right wing hippie.”
Just over one month after the Dow Jones Industrial Average hit the year’s high on April 26, it closed May with the worst decline since 1940, reports the Wall Street Journal. The Dow is “in negative territory for the week, the month and the year.” May started poorly with the “Flash Crash” that saw a 1,000-point slide less than one week into the month. The month dropped a total of 871.98 points. Friday’s sudden drop of 122.36 points came after noon when the Fitch ratings firm downgraded Spain, which was just the most recent crisis in Europe.
The president of the United States decided that he’d rather spend the long weekend in Chicago than attend the Memorial Day ceremonies at Arlington. Hmm…
Don’t worry I’m not about to engage in some pro-military screed. Though my family is military all through, and some of the best people I’ve ever met are military, and despite the fact that I am also a Navy Football fan (Go Navy! Beat Army!) I am generally anti-war and I’ve taken plenty of heat for it over the years.
War is a horrible thing in which the very worst of humanity is given legitimacy. Wars often happen for no good reason and are continued for even worse reasons. I am saddened by the rows and rows of men (and women) at Arlington who died for this country. I think of the sons lost and the fathers that will never be. I think of the tears. I think of the crippled both physically, emotionally, and both. I think of a young man face down in the mud as shells rain down around him. I think of the fear coursing through that soldiers brain unlike any most of us will ever know.
Memorial Day is a day where we remember the people who died for this country. Whether the conflict they died in was right or wrong is not important, on this day. On Monday we honor the lives ended, but also the lives disrupted by the premature departure of these soldiers from the earth. We honor the struggles of the mothers and the wives and the children left behind as much as we honor those who died in conflict. We remember.
It is the duty of the President to remember publicly. Duty, an interesting word, one that I wonder if this president knows the meaning of. He needs to be at Arlington because he is a representative of all of America. It’s a moment for the president to reflect upon the huge responsibility he has as commander in chief, and more importantly it is a chance for us to see him do it.
But instead I guess the girls and Michelle would rather go shopping. After all, according to Michelle, Obama’s election was the first time she had ever been proud to be an American. Most of the men on the slope of that hallowed hill died fighting for a country she has held in contempt for her whole life.
Whether intended or not her husband has communicated his contempt also by not spending Monday honoring America’s fallen in Arlington.
And oh, by the way, we still have 2 wars going on and many military personnel have died under Obama's command. But I know, he really needs a vacation.
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Municipal bonds are usually very, very solid. If a town defaults on on a muni issue it is a huge black eye for the community. There are differences in quality of course. Some towns are more credit worthy than others and this is typically reflected in the bond yield. Higher the yield, the less credit worthy the municipality. But generally speaking munis have been a great way to generate tax free income.
For those who don't know you don't have to pay federal or state taxes on muni bonds. (So long as you buy bonds issued in your home state.) If these instruments are starting to crack on a broad scale that is not good.
After what happened on Thursday night's Rachel Maddow interview, I must say I was a bit perplexed. I read the interview carefully, read the criticism of Rand and read libertarian publications to see the reaction. I was one of many who supported Rand Paul for his coherent and even, I would say eloquent, condemnations of TARP, the stimulus plan, healthcare reform and bailouts of banks in general. The Tea Party became a movement where I saw Rand as being an articulate spokesman for an increasingly massive protest movement. A populist movement even, without racism, even if its opponents were sure that there were in fact racist undertones everywhere. Rand was an authentic spokesman, moreover, not just another political opportunist who at one point in time had (supposedly) held their nose and voted for all of these things, many of which Republicans under George W. Bush proposed initially, frequently in the name of "economic stability", that catch-all logic to which no retort is possible since Nobel-prize winning economists such as Paul Krugman says it's so.
So, to go back to the interview, I was stunned, miffed really, at why the Civil Rights Act became a question, and as to why Rand would answer the way he did. My first reaction was, like others I began to discuss (argue vehemently) with, was that he was arguing Barry Goldwater's point that business should make its own decisions. I saw that Reason and other libertarian publications gave a tepid defense at best of Rand, and frequently cited that, as Julian Sanchez writing in Newsweek wrote, a "large net gain" was accomplished via the Civil Rights Act. Okay, I agree, many things were apparently gained by the CRA, but even acknowledging that there is 'net' gain is also to acknowledge that there were things lost. I was not born during that period. I was born in Kentucky but I was never victim of racial discrimination. I saw a lot of bigotry, and religious discrimination (believe it or not!), but I never saw overt racism. I know there was segregation, but it was always hard for me to imagine the South that was depicted in the Civil Rights marches, and I must say I have always been happy those days of segregation are behind us. But still, what was lost?
Let's look at Rand Paul and where he comes from for a moment before going any further. Everyone knows that he is the son of Rep. Ron Paul by now, and that Ron Paul has been an important libertarian, and that his signature issue is to attack the Federal Reserve, currently with an 'audit the Fed' bill which has gained traction in the House. Rand Paul's initial involvement in politics was largely via the Anti-Tax movement. He agrees with his father on many issues, but has been concerned with taxes in Kentucky on a local level, and became a well known local figure on that issue. Now I am unfamiliar with all of the factors that would have made him leave the sidelines, ditch his private practice clinic, and jump into politics. I'm sure both healthcare reform and the prospect of higher taxes had a great deal to do with it. But asking exactly what people's underlying motivations for starting such a quixotic quest for a Senate seat (not a House seat mind you, launching for the first time for a Senate seat), is something well worth asking. You have to 'know in your heart' you're right to make such a venture. There is a lot to put at risk in a bid for the Senate without any establishment backing.
So now we are back to the what was lost question. When the CRA was passed in 1964, Title II was swiftly put into effect with the other 9 Titles. As expected, the Supreme Court received lawsuits from the private sector, deciding one major case by a hotel chain (Heart of Atlanta Motel v US / 1964) and one major case (Katzenbach v. McClung / 1964) by a small barbeque outlet. Both decided against the businesses in question and in favor of the power of the Federal Government to regulate small business. But this was certainly not the first application of the Commerce Clause, used to find in favor of the USG in both cases, the first was nearly 30 years earlier. As Rand Paul said in another less controversial interview, just before the election, "It didn’t start last year. I think it started back in 1936 or 1937, and I point really to a couple of key constitutional cases… that all had to do with the commerce clause." The case he is citing is the 5-4 decision (West Coast Hotel vs Parrish / 1937) in which the government was found to have the power to impose minimum wage law during the Depression.
The Commerce Clause question has not gone away. Some of the more than 30 states will likely challenge Healthcare Reform on the Commerce Clause, since it forces citizens to purchase a product from a private company. As Constitutional scholar Randy Barrett writes, the individual mandate is imposing the power of the Federal Government via the Commerce Clause for economic inactivity. That is the point where we are today in the world of 'economic' or 'property rights' libertarianism, which I think is at a stage of far greater deterioration than perhaps other types of defense of negative rights. So the question of what the Federal Government may do with our private property is still prescient, but just barely, to the point where most Democratic legislators when even asked about the issue simply rolled their eyes.
Be that as it may, Paul made a major gaffe in starting the question with the CRA. Few items are considered to be more untouchable. If you were going to attack the Commerce Clause strategically, you could start by trying to reverse the Court decisions which found that the government can force a farmer not to raise grain for their personal consumption, thus impacting Depression-era forced grain buys (Wickard v Filburn / 1942). Why not get down into some Kentucky populism and call it the Roe Filburn Act, hit one out of the park for that old farmer who just wanted to raise wheat for his chickens and had the government step in and slap him around? But don't go towards the CRA. There are other very fair questions as to whether the CRA is still needed to maintain desegregation, and it's fair to point out that Jim Crow laws were imposed by States to force private establishments to segregate. For example, in Kentucky it was illegal to sell alcohol to blacks and whites on the same premises, building permits on the same premises for blacks and whites were prohibited (zoning regs), companies were forced to build separate bathrooms for black and white employees and railroads were forced to segregate passengers. These were not private initiatives to segregate, they were public ones. But Rand Paul failed to point this out, so I strike it up as a gaffe.
At the same time, the tepid response of libertarians in Rand's defense does deserve analysis. It probably boils down to the fact that libertarians have been riding the crest of a wave, and so get ticked off when someone makes a gaffe in this way. But, in all fairness, navigating the theoretical intricacies of libertarianism to create an electable platform is much more difficult than posting articles pointing out the boorishness of government and inconsistencies in its logic. Libertarianism has been afforded the luxury of never having to govern. If it is going to do so, it's going to have to explain that these are fair arguments, and defend people who come to the forefront. But it may also have to do with the fact that many libertarians in the movement today are social libertarians first and economic libertarians second. They like to cite economic reasons why they are right, but defending property rights is somewhat like on a chessboard, where first and second amendment are the king and queen, while property rights are mere pawns. They are fragile, undermined by court rulings, and for the most part hard to defend. So there are much fewer resources spent on defending them.
The fact that Rand Paul comes from the Anti-Tax movement means that they are among the first he defends, and given the economic climate and the menace of higher taxes, against political analyst's odds he may succeed in mobilizing economic populists in Kentucky to defend them. But it doesn't change the reality that property rights today are against the ropes, and that the government does pretty much what it wants with our money, and tells us to impose pretty much any regulation it wants, with any logic it wants. No lists of enumerated, limited exceptions such as Free Speech, the holy grail which McConnell has strategically championed. We shall see what happens in November to Paul and the rest of the 'Tea Party' movement and its candidates, but if the result is more Scott Browns, you can kiss your hard earned cash goodbye, movement or no.
A China Bear trend, which got its start when Wall Street hedge fund manager and confirmed short seller James Chanos began dropping bubblish sentiments about the country, is spreading internationally.
Chanos has been saying since January that China's booming house market has become a bubble supported largely by speculative money. One of his assumptions is that China's urbanization has not come up to expectations. Although Chanos has also said that, "China is the engine of growth that will hopefully pull us out of the morass that we find ourselves in," he has stuck to his point that China's house market has been crazy, calling it a "classic pocket…of overheating and overindulgence."
About 2 months ago I highlighted in my video blog the troubles that were occurring in China. The economic workhorse that had taken up the yoke from a diminishing (at least temporarily) US economy is stumbling. China has overheated its economy and cracks are becoming visible. The official Chinese PPI (Producer Price Index) number is currently running at 6.8% annualized but the real number is likely much higher. The same can be said for the Chinese CPI (Consumer Price Index.) A correction or even a crash is likely in my estimation before the end of this year.
Europe is a nightmare. The ECB appears hobbled. The European Union looks like it is in danger of breaking apart. The euro itself is likely moving to parity with the dollar. For all you geopolitical conspiracy theorists out there, if the euro is brought to parity with the dollar, the accounting for a worldwide currency becomes much easier. Just flip the switch. Wild speculation to be sure, but if the euro falls in line with the dollar the temptation will be very great to consolidate the currencies. If the euro looks like it may die, the macro masters of the universe will recognize that if they wait, and the Euro zone does break up, it will be that much more difficult to standardize the regulation of the economy under the IMF in future years. Their hand may be forced.
Perhaps a worldwide currency (or at least a trans-Atlantic one) will not emerge from the current financial order. But I put the odds at 30% before all is said and done that one does. Let’s not forget Medvedev’s exhibition of a world currency coin at the G8 last July.
The world is very keen to get its hands on the reserve currency. Many see the power vested in the dollar (correctly) as the key to US dominance of the globe.
Many very powerful people now see the concept of the nation state birthed at Westphalia as an antiquated concept. The elimination of the dollar as the world reserve currency and its replacement by a broader world fiat currency is a key goal. Never again will the world allow a state to dominate the Earth like the United States does currently. The Chinese may have something to say about this however.
I am unfortunately not privy to the conversations going on in the various Fortresses of Solitude around the globe, (man would that be awesome) so maybe I’m completely off base. But I don’t think so.
Regardless the world is having another seizure. As I watch CNBC I see concern in the eyes of the fund managers trotted out. Being good poker players, if they are “telling” concern, there is likely a good bit of panic floating around in their brains. Many a whiskey sour will be poured in brokerage houses at 4:15 this afternoon that is for sure.
What we are witnessing is the simultaneous birth and death of the economic system. We know what the economy used to look like. Some look back with longing, and remember “buy and hold” and 10% commissions on mutual funds. Good times, good times. But what the economy will look like in coming years is a real question.
Will we emerge into a new world in which the masters of the central banks whip the populations of the world into submission and conformity? Or will the current system splinter into a more competitive and potentially resilient system, in which there are many more nodes of economic and political power? Or will we stumble along in a half twilight of economic truth and economic fantasy for years to come? God help us.
There is only one option for those of us who value liberty, and that is a splintered, multipolar world. To the degree power is consolidated in central governments and in central banks the freedom of the average individual diminishes proportionally. The last thing free individuals need is a planet that is to big to fail. Because it will fail eventually, and take everything that is good with it.
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The new Ridley Scott film "Robin Hood", which has opened to mixed reviews on its merits as entertainment, is also drawing some critics' political ire. In New York's leftist weekly, The Village Voice, Karina Longworth laments that "instead of robbing from the rich to give to the poor, this Robin Hood preaches about 'liberty' and the rights of the individual" and battles against "government greed"; the film, she scoffs, is "a rousing love letter to the tea party movement." On a similar note, the New York Times' A.O. Scott mocks "Robin Hood" as "one big medieval tea party":
"If the two averages violate their May 7 lows, I see a major crash as the outcome," Russell wrote. With the exception of gold companies, Russell advised readers to "get out of stocks now, and I don't give a damn whether you have paper losses or paper profits."
In the first race called Tuesday night, conservative insurgent Rand Paul -- son of former GOP presidential candidate and Texas Rep. Ron Paul -- defeated Secretary of State Trey Grayson in a Republican primary fight for the seat held by retiring GOP Sen. Jim Bunning.
Grayson, the establishment candidate in the race, was the early favorite. But Paul overtook him and had an insurmountable lead, winning almost 60 percent of the vote with more than a third of returns counted.
In 1999 Saddam Hussein pulled one hell of a move. He decided to convert the sale of all of his oil from dollars to the euro. This sparked a rally in the euro and set off a chain of events that would lead to the invasion of Iraq by the US. Within 2 weeks of us invading Iraq we converted all oil trades back into dollars, despite the fact that the euro was roughly 17% stronger than the dollar at the time.
The re-conversion of Iraqi oil trades back to the dollar was one of the main reasons we went to war in Iraq, if not the reason. The implications of accepting this thesis are extensive and profound, and the subject of a book I am working on and will soon finish. But this post is not about Iraq. It’s about China, and how the original Red State can deal a very heavy blow to the US.
Imagine for a second that China were to drop the peg of the Yuan to the dollar and instead pegged it to gold, essentially creating a currency backed by a real asset. If that were to happen America would hear another “whooshing sound,” but this time it wouldn’t be jobs heading to Mexico, as Ross Perot predicted, but the sound of real capital exiting the dollar and converting to the Yuan.
This would create all kinds of problems for the Chinese potentially which I won’t go into here. (Because frankly I haven’t thought about it enough.) But the point is China now has the ability to launch a currency war against the US, with the flip of a switch, just like ole’ Saddam. This time however, there will be little we will be able to do to counter such a move.
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This is a pretty good article from the very liberal Salon Magazine. An in depth analysis of the unlikely Senate candidate and his run from Kentucky. His father's libertarian army and Rush Limbaugh's "Dittoheads" aren't natural allies. But Rand Paul has united them
May 14 (Bloomberg) -- Oliver Stone blasted the banking world as he presented the sequel to his 1987 blockbuster “Wall Street” at the Cannes Film Festival today, appearing with Michael Douglas and the rest of the cast at a news conference.
For some, the Federal Reserve is the right place to house any new regulatory powers contained in financial reform legislation. For others, the Fed is at the center of all that ails us. In fact, over 95,000 have signed a petition at auditthefed.com.
In an interview with the Post last month, Maguire said, "JPMorgan acts as an agent for the Federal Reserve; they act to halt the rise of gold and silver against the U.S. dollar. JPMorgan is insulated from potential losses [on their short positions] by the Fed and/or the U.S. taxpayers."
Bill Clinton said it. “The era of big government is over.” Of course that was a laughable statement even then, and seemingly even more so now. That the government would be the one to declare that the era of big government was over is ludicrous. The government continued to grow under Clinton and beyond and with that growth the rights of the individual continued to diminish.
We now however may actually be seeing the twilight of the Leviathan. Though most people don’t know it yet, the era of big government may soon be over.
How can you say this Nick? Obama and company are seizing industry after industry and hell bent on turning the USA into a European style welfare state. Surely big government is on the march, not on the wane.
To which I say that this is the very reason why the era of big government may be approaching its end.
What we are witness to right now is basically the wholesale looting of the American system by every interest that can loot it, be they the banks, the military industrial complex, the government worker unions, you name it. If you have a way to tap the fiat money machine, you are tapping it.
Now I don’t mean to disparage all the people within such institutions. Most people just want to make a living and go with the flow. The fact that they perpetuate this looting by remaining employed by the system is not their fault in most cases. Everyone has got to scratch for their meat, and pay the mortgage. Believe me I understand.
But the truth, in my view, remains that the American system is very quickly becoming overwhelmed. The Feds have tried to prop the system with fiat money, and they have succeeded to date. They have even sought to expand the government with new entitlements during this time of crisis.
Yet the clouds of the debt storm approach. The barrier islands are already being overrun by the tempest. Iceland, Greece, and then what? Portugal? Spain? Italy? Ireland? And then…
Then the storm hits the mainland. UK. Germany. Japan. The USA. Even China. There is the very real possibility that everyday things that we now take for granted will either disappear, or morph into very new things. Simple things such as trash pickup in your neighborhood might stop. The groceries that you are used to buying might no longer be available, or much more expensive. Even that nice fat government funded pension you’ve been counting on might turn out to be a pittance as inflation takes hold.
This is why I say that the era of big government may be rapidly ending. The mistakes of an arrogant aristocracy may actually bring down the system that they most benefit from. In its wake everyday individuals will be forced to do much more for themselves.
My sense is that this is already happening. There is a renaissance of gardening happening across America as we speak. Nothing beats the recession blues quite like a home grown salad.
Often when people talk about the current system collapsing there is a sense of dread- that chaos will ensue and that without the current order a Mad Max like reality will take hold.
This is not necessarily the case. Indeed even with massive and rapid collapse, I think this is an unlikely situation.
What I think is far more likely is that people will begin to look to their immediate community for solutions. Neighbors will leverage each others strengths. New ways of dealing with problems will be devised. How about a neighborhood compost heap that next season can be used for soil in community gardens, for instance?
I don’t mean to be Pollyannaish. There are going to be issues with order and safety, we are not destined for some “libertopia,” at least not without coming to terms with the fact that millions who are used to getting a check in the mail will no longer be getting one.
But I believe that without the central planners many may find their lives richer and more interesting. Then again, I don’t get any government checks.
America's love affair with the cannabis plant has without a doubt turned a corner. Whereas discussion of weed was once relegated to Rolling Stone and High Times Magazine, pot is enjoying new legitimacy as California ponders outright legalization.
CNBC has been doing it's part. For the past 2 weeks it has been featuring "Marijuana and Money" on it's website.
Right next to Dow Industrials charts are articles discussing the pros and cons (mostly pros) of legalization.
May 4 (Bloomberg) -- Greece’s bailout “might collapse” and the nation’s debt crisis makes it “hard to see” how the euro will survive in its current form, former Bank of England policy maker Charles Goodhart said.
ATHENS, Greece (AP) - Angry Greeks took to the streets Tuesday and unfurled banners at the ancient Acropolis, the country's most famous monument, to protest harsh new austerity measures as strikes began across the country.
My first academic love was geography, my second politics. The two compliment one another, yet in geopolitics, geography has for a long time taken a back seat to cultural and economic analysis. This has not served us well Robert Kaplan asserts.
This is about the best piece on Old World geopolitics that I have ever read. I would encourage everyone with an interest in world politics to read this excellent article.
From the article:
People and ideas influence events, but geography largely determines them, now more than ever. To understand the coming struggles, it’s time to dust off the Victorian thinkers who knew the physical world best. A journalist who has covered the ends of the Earth offers a guide to the relief map—and a primer on the next phase of conflict.