Dear Mr. Obama,
Please forgive the American People if we repeat ourselves; if we tend to remember certain inspiring episodes in our quest for Human Liberty. But, "…it is natural to man to indulge in the illusions of hope…" ~ Patrick Henry
"The illusions of hope" are not going to pay the bills. And the black hole of bailouts will suck everything into it that comes close enough. Throwing good money after bad would be foolish enough. But throwing fiat money after the delusions of economic ignorance is well beyond all folly.
Though thou shouldest bray [pulverize] a fool in a mortar among wheat with a pestle, yet will not his foolishness depart from him. ~ Proverbs 27:22
Businesses and Countries often deserve failure [Does Zimbabwe come to mind?]. Failure is a built-in factor of anything that starts off on the wrong foundation. Turnarounds are rare. But they must be based on sound principles which must be embraced in lieu of the unsound. If you amass and "enable" enough companies that are allegedly "too big to fail" you will bring down the entire national economy. Sooner or later we learn our lessons. But the sooner nature is allowed to take its course, the sooner we can rebuild on a solid foundation. Have you ever had a root canal where the dentist didn’t manage to clean out the tooth properly? If you did you would remember. This economy is headed toward Abscess unless the root causes are fully addressed.
It is curious to note that they keep using the term "toxic paper" as if precision in euphemisms no longer mattered. How do you come up with a nice way to describe bad debts contracted under various fraudulent circumstances and combinations — which are to be paid off with fake money? Do they think the American public no longer equates "toxic" with "poisonous" or "deadly?"
It is as though this administration has seen the powerful body of evidence that refutes every notion they have about launching a "recovery," and they are running headlong in the opposite direction. "Swindling futurity" as Jefferson called it, is not a difficult concept. Surely the average Harvard grad can grasp it. You just keep looking for new and creative ways to steal property from the estates of other people’s grandchildren. If we maintain the present course there will not be much left for even the Elite to enjoy. These machinations would be impossible without a fiat money supply.
A concentration of too many fools can be mistaken for a conspiracy.
What fools these mortals be who think they can rely on Keynesian economics, fractional reserve banking, fiat currency, socialism, and the monopoly of force. After decades of decline they expect to cure the disease by helping the pathogens multiply. As Ron Paul has said they are trying to put out a fire with kerosene. Ron only seems to be a prophet if you haven’t read what he has read.
Bastiat: “Government is the great fiction through which everybody endeavors to live at the expense of everybody else.” He also went into detail to explain "That Which Is Seen, and That Which Is Not Seen."
What about Gresham’s Law?
Is good money suddenly going to start chasing out "toxic paper?" Certainly not of its own accord. Does it really matter what form the bad money takes? Is it reassuring to you to know you can exchange two fives of fiat currency for a ten of the same inherently worthless toxic paper?
Could the "government" and the Fed have pulled this off without the aid and comfort of legal tender laws?
Will the Chinese and the Russians continue to be amused? I don’t think so. How would you like to have the assignment of going to the Chinese and asking them to extend a little more credit to the US? Now may not be a good time. You might not come back.
Have I stumbled on another reason for the US to have an aversion to "nuclear proliferation?" "If you don’t have Nukes we don’t have to pay you. We’ll just keep taking what we want and giving you some form of fiat IOUs."
The creation of practically infinite amounts of new "money" will eventually drive away all creativity, productivity and resources. These will make themselves wings and wait until it seems safe to come out of hiding.
Real recovery starts when the delusions fade.
We need a combination of negatives and positives to get this thing going again. The companies whose management policies and economic models have caused them to fail must be allowed to fail — especially when other companies in the same industry are surviving. Someone had foresight. Now someone can gain hindsight.
The companies that have shown themselves to be successful without "government" "help" must be left to their own devices. We must guard against those in government service who are "concerned" about "helping" all companies "equally." Any notion of equality of outcomes is an unlawful concept. Failure is a good thing when you are running toward a precipice.
We have a local dry cleaner who posts pithy sayings on his sign. This week it says that, had he known the Bailout was coming he would have defaulted on a much bigger loan. Watch now as new "industries" arise just to take advantage of the new flow of stimulus money. It is happening already. Radio ads are being broadcast that would have seemed shameful to our parents’ generation. It would appear there has been a merger between the ambulance chasers and the mortgage brokers. "Come one, come all! Get your new toxic loans." "Don’t worry! It’s a Government Grant. You’ll Never have to pay it back!"
I dare say that companies who may have listened to Ron Paul in the past would have had a survival rate somewhat higher than any who may have relied on the business acumen of Nancy Pelosi — or almost anyone else in the Congress or the White House.
And what about a country who follows Ron Paul’s advice and that of the Founding Generation?
"A Prophet is not without honor, except in his own country…" ~ Mark 6:4a
The above speaks of a temporary situation. Certain principles of law will Never be overturned. The Correction always comes.
Alexander Pope coined: "Hope springs eternal in the human breast…" But he also cautioned: "A little learning is a dangerous thing." And let us never forget, "Fools rush in where angels fear to tread."
Ubisilent leges incipit bellum [War begins when the laws are silent].
Come! It’s getting late! Help me wake up THE LAW!
Bill Huff [send him mail] is a Classical Libertarian and proprietor of LEXREX.com and JamTheCulture.com; a former public school music teacher turned home schooling advocate; a US Navy veteran, and host of WarIsARacket.com. He is available as a guest lecturer or for interviews on talk radio.