The coming Congressional follies

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There is no limit to the follies that a legislature engages in. The British Parliament at one point passed resolutions declaring that the Sovereign could make the coinage contain any weight of gold he chose and that the price of gold and the foreign exchange rate would then in no way depend on the weight. The U.S. government and the Federal Reserve have been engaging in a similar fantasy for 95 years. Meanwhile the dollar has depreciated some 97.5 percent against gold.

There is no Congress in which follies of this magnitude are not solemnly committed to paper and promulgated throughout the land. The sad fact is that the population no longer views them as follies. In the next Congress, ruled as it is by overwhelming majorities of one Party and having an Executive of the same Party committed to sign the Acts that this Congress emits, we can expect an intensification of folly. The stock markets will be commanded to stand still and be stable under a financial stability czar. Bad loans will be commanded to turn into sound loans. Trillion dollar deficits will be declared to represent sound economy.

5:37 am on November 7, 2008