The continued tyranny of Robert Mugabe

Robert Mugabe, Zimbabwe's president equivalent of Stalin, blames the West for his country's economic woes. It's an old tactic employed by all tyrants: they disguise their actions by distracting the people.

HARARE, Zimbabwe Jul 25, 2006 (AP)— President Robert Mugabe opened a new legislative year Tuesday with a speech to Parliament blaming economic problems on the U.S., Britain and other Western critics of his human rights record.

Zimbabwe is in a state of economic collapse, suffering from the world's highest inflation rate more than 1,000 percent and shortages of all basic goods. A quarter of its 16 million people has emigrated since 2000 and millions more are dependent on aid.

"My tribute goes to the gallant people of Zimbabwe for continuing to exhibit great fortitude despite the prevailing economic challenges which are orchestrated by the country's detractors," the 82-year-old president told legislators....

In what has become a ritual, Mugabe, who has ruled Zimbabwe since independence in 1980, blamed the country's woes on his foreign critics.

"We note with concern the continued imposition of illegal sanctions by the European Union and the United States of America at the behest of our erstwhile colonizers," Mugabe said, in reference to Britain.

"We feel proud that we have defeated that strategy that was aimed at the collapse of our economy and the happening of regime change."

The United States and the European Union have imposed travel bans and other targeted sanctions against Mugabe and members of his government.

So in fact, the "sanctions" are not aimed at the people of Zimbabwe, but their oppressive ruler who has destroyed their homes, impoverished the already impoverished beyond all imagination, and engineered starvation. There is a special place in hell for this son of a bitch. As I've previously detailed, Mugabe and Mugabe alone is responsible for his country's crisis, which involves every type of assault on human liberty.

Mugabe's assault on the poor
Mugabe's assault on the poor, continued
Mugabe's assault on the poor, part III

Just like the Declaration of Independence was a list of George III's crimes, let us form a similar one about Mugabe:

From the beginning he has had dissidents tortured, and like any of Stalin's successors, having his henchmen torture and murder his opponents is not a rarity. Rigging elections is so expected that one hardly bats an eye, even to hear that voters are threatened with withheld aid should they elect Mugabe's opponents. This March, Mugabe threatened people with death if they tried to overthrow his government "unconstitutionally." Of course, "unconstitutionally" means anything that might break Mugabe's power, no matter how justifiable by the principles of freedom.

Sadly, mainstream media largely ignores these sins in favor of more visible ones. It was in 2000 when Mugabe commenced his policy of stealing arable farms from owners (because they were white) and redistributing the lands to his supporters; the shift from agricultural to residential use is the cause of Zimbabwe's famine. Last year, Mugabe began sending his thugs to raze hundreds of thousands of homes belonging to his rivals' supporters. He has people arrested for "informal" commerce. He has made it a crime to own foreign currency, so that when his cronies at the central bank continue with hyperinflation, the people are left as poor as possible. And this latest article reports that Mugabe's "national regulating authority" (a euphemism for secret police) will "monitor electronic communications" beginning next year.

Is there nothing left for him to trample? For the good of Zimbabwe, someone needs to assassinate this bastard.

Mugabe's assault on the poor

[Update: I must have accidentally "cut" part of the paragraph talking about foreign aid sent to Africa. It's been corrected.]

Mugabe is officially Roman Catholic, but his heart is so black that there is no doubt a special place in hell for him. Truly we're hard-pressed to find such raw evil. At her Senate confirmation hearings, Secretary of State Condoleeza Rice was absolutely correct to list Zimbabwe among the world's "outposts of tyranny."

UN agencies have apparently "condemned" Mugabe's new assault on Zimbabwe's poor, which began four weeks ago. However, their criticism has been quiet enough that I've only seen brief mentions of it in the news. The White House and EU have denounced what Mugabe is doing. Zimbabwe's Roman Catholic leaders have denounced it. Tony Blair is being pressured. Paul Wolfowitz has denounced it, but not strongly enough.

Wolfowitz says Zimbabwe evictions 'a tragedy'

Zimbabwe is in "pretty bad shape and getting worse," new World Bank President Paul Wolfowitz said on Saturday, adding that reports of thousands being driven from informal settlements was a "tragedy." ...

Aid workers say around 200,000 Zimbabweans have been made homeless by a recent blitz by President Robert Mugabe's government on informal settlements and stalls, hurting a population already hit by AIDS and bad harvests.

"These latest reports of hundreds and thousands of people driven out of their homes is both inhuman and it must do enormous damage to development prospects for the country," he said. "It's a tragedy."

These people are not only sleeping in the street, but they're sleeping unprotected in wintertime. (Zimbabwe is in the Southern Hemisphere, which has winter while the Northern Hemisphere has summer.) I ask myself, "What is wrong with us?" when our Western news obsesses about Abu Ghraib, Gitmo prisoners and Michael Jackson (that is the only time you will see me reference him on my blog), ignoring this tragedy where babies freeze to death, amidst cholera outbreaks.

Besides the people who have lost their homes, over 32,000 people have been arrested. On what charges? "Illegal" commerce, but the "crimes" are flea markets and informal merchants -- people who are simply trying to eke out a living. Mugabe has defended the destruction, insisting that these urban shanty towns are illegal and overrun with "criminals." If he's looking for criminals, he should first look at himself. Then again, he's technically right: he has made it a crime to seek out an honest living that is not "blessed" by his government. The previous "criminals" were the white farmers, whose sole "crime" was retaining ownership of the farms that their forefathers had started.

Ayn Rand was right. She wrote in Atlas Shrugged, "There's no way to rule innocent men. The only power any government has is the power to crack down on criminals. Well, when there aren't enough criminals, one makes them. One declares so many things to be a crime that it becomes impossible for men to live without breaking laws."

Mugabe used the white farmers as a scapegoat for Zimbabwe's economic woes. His "land grab" made things even worse: white-owned farmland was given to blacks, who often built homes on the land instead of continuing farming, and Zimbabwe's agricultural output plummeted. Meanwhile, Mugabe's government seized any other land it wanted, allowing his cronies to enrich themselves off Zimbabwe's tremendous mineral wealth. Now he needs someone new to blame, and sadly, it's these urban poor and their "informal" economy.

Zimbabwe's unemployment rate is over 80% (contrast that with the last U.S. recession, when we didn't even hit 7%). Since four-fifths of Zimbabweans cannot find jobs (not stable jobs as we know them), they must do what they can to sell goods and services to each other. Yet Mugabe accused them of "sabotaging" Zimbabwe's economy. How can people engaging in voluntary, peaceful economic activity, and not inhibiting others from doing the same, cause any harm to the economy? They're the ones generating economic activity, unlike Mugabe, who is destroying it. But as an avowed Marxist, Mugabe won't allow any economic activity that isn't under his government's auspices.

ZWNews.com explains that part of Mugabe's plan is "destroying informal 'flea markets' in order to tighten its control of the economy." Therefore, he must destroy any commerce not sanctioned by his government, and any merchants who won't give in to his tyranny. This extends to centralizing all foreign currency, which people are using for the simple reason that Zimbabwe's dollar is practically worthless. When people lose confidence in the soundness of their national currency, they must find a stable medium of exchange. It's another manifestation of individual liberty that Mugabe cannot permit to continue.

One estimate is that possibly 1.5 million people are now homeless. A Sunday Herald article said two million, also noting why Mugabe is really doing this: urban dwellers were big supporters of the opposition party in the parliamentary elections earlier this year. This is literally his revenge. Independent Online echoes that and also points out that Mugabe is blocking aid to these people, who are basically refugees. His actions are so criminal that "Even some non-governmental organisations who don't normally criticise the government publicly, such as the Zimbabwe Doctors for Human Rights (ZDHR) and the Zimbabwe Teachers Association (Zimta), have been forced to speak out because of the magnitude of the crisis." The ZDHR estimates between 1 and 2 million people are homeless, far higher than what relief agencies are reporting.

Another ZWNews.com article bemoans the fate of those who won't sell their souls to Mugabe:

Thousands of Zimbabweans made homeless in the government's ruthless clean-up campaign are being herded into re-education camps and told they can have a housing plot only if they swear allegiance to the party of President Robert Mugabe. Those who refuse are loaded into trucks and dumped in remote rural areas, far from their own homes, where food is scarce. Human rights workers say they are being left to die in what they believe is a deliberate strategy by the Mugabe regime to exterminate opponents....

...Yesterday police rampaged through Harare, setting fire to the few remaining belongings that many homeless people had salvaged, and warning them against taking refuge in churches. So brutalised is the population that some torched their own possessions on police instructions. A Harare police commander was reported to have authorised the use of live ammunition against people resisting eviction. "I need reports on my desk saying we have shot people," he was said to told his officers. "The president has given his full support for this operation so there is nothing to fear. You should treat (it) as a war."

That's not all. The extent of Mugabe's tyranny is such that other Zimbabweans are afraid to protest against him, lest they incur the wrath of his police.

What can we do? Western nations for years have sent food and money to Zimbabwe, always with the same result: Mugabe and his henchmen seize most of the food and money for themselves, distribute some to their supporters, and prevent all relief efforts from reaching the intended recipients. It should be noted that this happens with many African nations, as well as Iraq under Saddam Hussein.

Einstein reputedly said, "Insanity: doing the same thing over and over again and expecting different results." So what's left?

Should "some nation" send in covert agents to assassinate Mugabe and his top leaders, I question whether Zimbabwe would be worse off with the pursuant social chaos and possible civil war. At least they'd be free to fight for true freedom.

The best option would be what the Second Continental Congress adopted on July 4, 1776:

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. --That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, --That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness. Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.

This is not possible, however, while Zimbabweans are deprived of firearms to protect themselves from tyrannical government. This is what Noah Webster noted:

Before a standing army can rule, the people must be disarmed; as they are in almost every kingdom of Europe. The supremepower in America cannot enforce unjust laws by the sword; because the whole body of the people are armed, and constitute a force superior to any bands of regular troops that can be, on any pretense, raised in the United States.

Now consider what Shogun Toyotomi Hideyoshi reportedly said in 1558:

The people of the various provinces are strictly forbidden to have in their possession any swords, bows, spears, firearms, or other types of arms. The possession of these elements makes difficult the collection of taxes and dues, and tends to permit uprising. Therefore, the heads of provinces, official agents, and deputies are ordered to collect all the weapons mentioned above and turn them over to the government.

The last sounds a bit apocryphal to me, but it's still the same principle.

Mugabe's assault on the poor, part III

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Mugabe's assault on the poor
Mugabe's assault on the poor, continued

I just saw the headline "Zimbabwe Suffering Worst Economic Crisis" on Yahoo! News; the article is from Friday. Uncertainty and scarcity of resources, coupled with the world's highest inflation, is how the few non-poor (we can't call them "well-off") in Zimbabwe live. The article doesn't tell the worst story, though, nor does it tell you who's really causing this.

If you read my two previous entries, you'll see the real economic crisis in Zimbabwe: the government's policies that produced 80% unemployment and 800% inflation, the government shutting down informal "flea markets" and accusing them of "sabotaging" the economy (when in fact they are the economy), the government destroying 200,000 homes and forcing possibly 1.5 to 2 million people to endure the winter cold, the government seizing the mineral wealth to distribute among its bureaucrats and their friends, and the government seizing all foreign currency (the only stable money, because Zimbabwe's dollar is basically worthless).

Notice that the government did quite a bit, in fact, every last bit. Nothing more embodies Ronald Reagan's statement, "In the present crisis, government is not the solution to our problem; government is the problem." And Zimbabwe's slow self-destruction is solely because of one man and his evil ideals: Robert Mugabe. What he's done is on par with Stalin's forced starvation of the Ukraine, Mao's "Great Leap Forward" that may have killed 70 million people in its famine, and Pol Pot's plans for a socialist Utopia that may have killed two million people.

This March, the Foundation for Economic Education's monthly evening event will be by Dr. Richard Ebeling, its president. "Is the Spectre of Communism Still Haunting the World?" will no doubt be fascinating, but I would like to offer an answer tonight:

I don't think there has been a spectre of communism in nearly a century. What was just an evil spirit of ideas found willing flesh, creating devils of communism like Lenin, Mao, Pol Pot and Nicolae Ceauşescu. One of the devils in power today is named Robert Mugabe, in whose government we can witness the triumph of socialist central-planning. "The Lord reward him according to his works."

Oh irony of ironies

Pajamas Media has the story: the power went out, literally, and stayed out for much of Robert Mugabe's speech on Zimbabwe's electrical shortages. Via Little Green Footballs.

But it's Mugabe, so he probably will find a way to blame it on evil capitalist subversives and traitors, and of course, the West. After all, this is someone who blamed Air Zimbabwe's problems, specifically that it had to shut down after running out of fuel, on "mismanagement and corruption." However, that is correct: Zimbabwe's problems stem almost exclusively from Mugabe's mismanagement and corruption.

Previous:
Mugabe's assault on the poor
Mugabe's assault on the poor, continued

Mugabe's assault on the poor, continued

And the UN, perpetuating its internationalist tradition of moral hazard, gives Robert Mugabe every incentive to continue his evil.

Welcome, GOPinion and Michelle Malkin readers! Please feel free to take a look around. I'm actually more of a conservative libertarian (with foreign policy hawkishness) than a traditional conservative, which I explain toward the end of this entry (which GOPinion also liked) on Jordan's mini-9/11.

Some of you may remember my original "Mugabe's assault on the poor" from last June. I strongly recommend reading it so you know precisely what this evil man has done. I detailed how that monster destroyed the homes of at least hundreds of thousands of people, arrested another 32,000 on baseless crimes, and tightened his Marxist control of an economy that he sinks further just when we think it couldn't get any worse.

Zimbabwe has now decided to accept the UN's offer of help:

Zimbabwe Accepts U.N. Emergency Housing

Zimbabwe has backtracked on its refusal to allow the U.N. to help build emergency housing for people whose homes were demolished in a government eviction campaign.

U.N. officials in Harare said Thursday that Housing Minister Ignatius Chombo accepted the assistance in a letter earlier this week. Building is to start next week on the first 10 of a proposed 2,500 units.

The government had initially refused U.N. offers to provide temporary shelters for families made homeless by a campaign of evictions in May and June, saying it wanted permanent structures.

Yasuhiro Ueki, the U.N. spokesman in Harare, said U.N. officials were now discussing technical details with the government.

"We are not talking about tents here," he said. But he added that they would not be conventional houses, even though they would stand on a concrete base and floor.

"They are rather small," he said.

Forgiveness is one thing, but the UN again demonstrates that it will step in after dictators ravage their people's lives -- when the dictators show no indication whatsoever that they will ever change their ways.

Dictators like Mugabe must sleep so well at night. They know that they can intentionally inflict the most horrible economic disasters and "humanitarian crises" on their countries, and UN suckers (greatly funded by American taxpayers) will be there to clean up the mess. Meanwhile, the dictators can hold out for months to make it as bad as possible for the affected populations. Remember that the demolitions occurred in June, during the Southern Hemisphere's winter. How many people died from exposure while Mugabe refused offers of assistance, and how many since then from starvation because they had gone months without ways to support themselves?

Chavez' apologists

When reading tripe about Chavez congratulating Sean Penn, I checked a link to an earlier article by a Chavez apologist. I presume it was in the op-ed section, but these days, a lot of op-eds masquerade as genuine news.

From the very title, it's a complete lie. "Chávez is no enemy of free speech"? Certainly he isn't, in the same way that Robert Mugabe is bettering the lives of Zimbabwe's poor and the oppressed, and the same way that Mao propelled China forward (disregarding the little bit about 70 million people starving to death).

Tito Hugo's apologist blathers:

But after Chávez was elected president in 1998, RCTV shifted to another endeavor: ousting a democratically elected leader from office. Controlled by members of the country's fabulously wealthy oligarchy, including RCTV chief Marcel Granier, it saw Chávez and his "Bolivarian Revolution" on behalf of Venezuela's majority poor as a threat.

RCTV's most infamous effort to topple Chávez came during the April 11, 2002, coup attempt against him. For two days before the putsch, RCTV preempted regular programming and ran wall-to-wall coverage of a general strike aimed at ousting Chávez. A stream of commentators spewed vitriolic attacks against him – while permitting no response from the government.

Then RCTV ran ads encouraging people to attend a march on April 11 aimed at toppling Chávez and broadcast blanket coverage of the event. When the march ended in violence, RCTV and Globovisión ran manipulated video blaming Chávez supporters for scores of deaths and injuries.

This is a textbook example of whitewashing a tyrant's bloodstained record, and shifting the blame to those resisting the tyranny. Point out that the government is democratically elected, meaning a majority vote to seize the property of the minority -- check. Accuse the critics of being rich, evil capitalists who are bent on oppressing the poor -- check. Accuse the critics of showing only "their side" -- check.

Free speech means being able to say what you want, with your own bias if you want, and not having to worry about being "fair" and "objective" about your opponents. I wonder if this damn fool really believes his tripe. "Radio, TV, and newspapers remain uncensored and unthreatened by the government"? If TV truly remains uncensored and unthreatened, then why must RCTV now broadcast only by cable and satellite? If RCTV were truly free, not only would Chavez have had no problem renewing its license, RCTV or any other television station would need no license to broadcast. A license is permission from the government to do something you had the natural right to do in the first place. If all media outlets are indeed free to say what they want, then why is Chavez systematically shutting down all publications and broadcasts that criticize him? Foreigners now can be expelled for criticizing Chavez's government, and it's a shame native Venezuelans couldn't simply do the same to get Chavez to pay for their plane ride to America.

Would a network that aided and abetted a coup against the government be allowed to operate in the United States? The US government probably would have shut down RCTV within five minutes after a failed coup attempt – and thrown its owners in jail. Chávez's government allowed it to continue operating for five years and then declined to renew its 20-year license to use the public airwaves. It can still broadcast on cable or via satellite dish.

Here again we see what an idiot this propagandist is. Legally speaking, "aiding and abetting" is a matter of providing material support, not merely media coverage. In the United States, our constitutionally guaranteed freedom of speech would in fact protect a media organization that was merely sympathetic to the coup -- and that's what RCTV was, merely sympathetic, not directly supportive.

"Most Venezuelan media are still controlled by the old oligarchy and are staunchly anti-Chávez." Like Maid Marian in "Robin Hood: Prince of Thieves," they give the government no excuse to take their property. Thus they dare be no more than silently against Chavez, lest they suffer the same fate as RCTV.

Of course, RCTV is accused of "sedition" because it "supported" the failed coup. Sedition a threat only to the power of government, nothing else, and it's been a convenient excuse throughout history for tyrants to crush their opposition. It's important to remember that freedom of thought is most dangerous to the state, and that is precisely why Chavez wants to silence his opponents. It's worth quoting Jefferson again:

It is error alone which needs the support of government. Truth can stand by itself. Subject opinion to coercion: whom will you make your inquisitors? Fallible men; men governed by bad passions, by private as well as public reasons. And why subject it to coercion? To produce uniformity. But is uniformity of opinion desireable? No more than of face and stature. Introduce the bed of Procrustes then, and as there is danger that the large men may beat the small, make us all of a size, by lopping the former and stretching the latter.

But as with all tyrants, Chavez wants to make everyone but him uniform: uniformly impoverished, uniformly weak, and uniformly uninformed, so that he can continue to wield power over them.

There is no amount of pain and suffering I would not wish on these tyrants

Lots of people are talking about Robert Mugabe, who's now been sworn in for another term after the farce of an election. But what about our tyrants at home? We complain about our federal government, which is so bloated that it would take less than three months to blow through the three quarters of a trillion dollars that my employer is managing for our clients. And there are more at the state and local levels.

To hell with you and your minions, Michael Bloomberg. I hope your sorry carcass rots painfully in hell for all eternity. First it was forcing private property owners to ban smoking in their bars and restaurants. Now it's forcing private property owners, and their voluntary customers, to stop using trans fats so they can be "healthier." If we eat our properly made cannoli or bread, what business is it of yours?

Rot in hell, you miserable son of a bitch.

And to hell with you, David Patterson, and all in the New York State legislature who supported the online sales tax. As of June 1st, it's not just purchases from Amazon that are being taxed. I just renewed an online subscription with Electronic Arts, who has no presence in this state, and I'm being charged sales tax. Even if the law is struck down as unconstitutional, which it is, how will I get a refund? Considering this is New York, the legislature will spend twice as much as the original refunds to return the stolen money. You greedy sons of bitches just can't keep your grubby mitts off other people's money. I wonder how you'll like it when the devil won't keep his grubby mitts off your souls.

Since when is taxation with representation any better than without?

Again, there is no amount of pain and suffering I would not wish upon each and every one of these assholes. If they died unspeakably horribly, whether struck by a Mack truck, lightning or an angel of the Lord, I would laugh with not an iota of sympathy.

Update: as I've said in the past, tar and feathers are an American tradition we really ought to bring back.

Nowhere in their league!

So Time's Persons of the Year for 2005 are Bill and Melinda Gates, and Bono. It's for their charitable work, but Bono in no way is in the Gates' league.

Bill Gates acquired his billions by being a smart, hardworking businessman that revolutionized the computer industry (for good or for ill). He and his wife have since donated billions to charity through their foundation. One of their principal causes is funding vaccinations for Third World children, which are extremely cost-effective in reducing child mortality. I'm not dismissing clean water and sanitation, but vaccinations are a very inexpensive way of giving children in poor countries a fighting chance against diseases that Westerners no longer worry about.

The Gates are an example of personal philanthropy that we'd all do well to emulate, and such a quiet one that most people know little or nothing about their foundation. Mainstream media and anti-capitalists are complete hypocrites for blasting successful businessmen like Bill, ignoring that if we did follow George Orwell's second point of his six-point programme, limiting "the rich" to something like ten times the income of the lowest wage earner, there would be hardly any wealth creation, and therefore no wealth to donate to the poor.

Bono acquired his wealth by being an overrated (IMO) musician. He now travels the world, telling rich nations' governments how we need to give more, instead of setting an example (like the Gates have done) by quietly donating his own money. He and other internationalists push for this absurd figure of rich nations donating a full 0.7% of GDP in foreign aid. And for what, so we can prop up more dictators like Robert Mugabe? So we can give money to Palestinian terrorists who then use our money to murder more innocent people?

There's absolutely no comparison between two of history's great philanthroposts and a musician with passé eyewear (who can't even produce original music anymore). Bono deserves "Person of the Year" as much as Arafat deserved a Nobel Peace Prize. Oh, wait, that was done...

It's Krugman's old anti-Semitic friend Mahathir

My blogfather Don Luskin never missed a chance to expose Paul Krugman's chummy relationship with Malaysia's ex-Prime Minister (and notorious anti-Semite) Mahathir Mohammad. Via Little Green Footballs, you can see a video of Mahathir's new bunk against both Israel and the United States. But let's ignore his sabre-rattling; I have an economic perspective that, without checking around the blogosphere, I believe is unique.

Like his buddy Paul, Mahathir lives in economic fantasyland. First, let's be clear about who owns U.S. debt. The United States government doesn't owe $14 trillion to anyone; Mahathir's claim isn't even true if we count all the Americans who hold Treasury bonds as part of "the world." As of August 24th, U.S. federal government debt is $8.5 trillion, and much of it we owe to ourselves. Only $2 trillion of U.S. debt is held by foreigners, led by Japan ($635 billion), China ($328 billion), the UK ($201 billion), Korea ($69 billion), Taiwan ($67 billion), and Caribbean banks ($60 billion). "Oil exporters" collectively hold $101 billion, which is a mere 4.8% of foreign-held U.S. debt, and not quite 1.2% of total U.S. debt. So Mahathir's claim is true that they hold "some" of U.S. debt, but his insinuation that they're significant holdings is a laughable one (as are most of the things he says anyway).

Per the Federal Reserve's flow of funds tables, Americans collectively owe about $27 trillion in debt, but again much of that is to ourselves, and meanwhile Americans own $66 trillion in assets as of Q1 2006. Some assets are in stock markets, some are in real estate, but remember that the values are because someone is willing to pay a certain price for them and has the money to pay. Let's say Peter and Paul are the only two members of an economy. Adjusting for inflation, if they collectively have $200 in assets, and $300 one year later, it shows how much wealthier they have become, that they're willing and able to pay more money. If this is bankruptcy, then give me more of it! By the way, Brad DeLong's lackeys can claim GWB has destroyed wealth (based on a stupid misunderstanding of what exchange rates mean), but the Fed's FoF analyses are a good measure of how well Americans have fared under George W. Bush's tax cut policies. And this expansion is far more sustainable than the 1990s' tech bubble. Instead of being based on generational phenomena, it's based on the time-honored principle that lower tax rates is an incentive for people to produce more.

Mahathir's next claim, that the U.S. is financing the war in Iraq "through the money that is lent...by rich countries, some of which are Muslim countries," is particularly idiotic. It would be accurate to say that the U.S. federal government borrows some money to finances all of its expenditures, including military operations in Iraq. Even so, assuming that John Murtha's figure of $8 billion a month is correct, $100 billion a year (I rounded up) is only 0.77% of the ~$13 trillion American economy. Putting aside the issues of whether we should have gone into Iraq and whether the federal government should borrow only for purely defensive wars, the U.S. is hardly dependent on foreign borrowing. It borrows because, for good or for ill (I say more for ill because it means Congress has more money to waste), foreigners are more than willing to lend the money at pretty low interest rates. We can have our cake and eat it too.

Many doomsayers from Krugman to Austrian economists warn about "when, not if" foreigners shift from dollars and stop buying U.S. Treasury bonds. But major U.S. debt holders don't want that: when Microsoft stock goes down, does Bill Gates sell off all his shares in an effort to preserve his net worth? For the same reason he wouldn't help push the share prices down even more, China especially won't allow the dollar to decline: its banking infrastructure depends on U.S. debt instruments as collateral, so it needs its U.S. debt holdings to retain value. And what about the threat of oil being sold in euros or anything but dollars? Well, Saddam tried that; didn't work. Iran threatened that; its market didn't even see opening day.

People like Soj at DailyKos don't understand that when no country has a commodity-backed economy (which isn't completely desirable since your economy then waxes and wanes with the commodity's production), the confidence of consumers and investors is the only factor. The American economy is the only major one that is expanding steadily and sustainably, thanks (or despite) its somewhat screwed-up free market system and rule of law. For whatever reason, foreigners know that the United States is the place to invest. I point to American workers' productivity surge, a factor transcending mere commodities, which Econopundit Steve Antler thinks is "the most important economic news of the decade."

It would be disaster for Europe and Asia if the dollar lost half its value. The French in particular have suffered in good part from a strong euro (although Italian wine exports aren't having that problem). The Bank of Japan is always selling yen for dollars to keep the yen weak, because Japan is heavily dependent on exports (the U.S. actually exports more as a percentage of GDP, but Japan needs exports because its domestic economy is still shaky). China's central bank similarly manipulates the yuan to keep it from gaining strength from natural trade forces (which would make Chinese exports less attractive), but also to buy the aforementioned U.S. Treasury bonds as collateral to keep China's banking infrastructure and currency from collapsing. None of them want the dollar getting any weaker, and China certainly would like a much stronger dollar. Since it pegs the yuan to the dollar, a stronger dollar and hence a stronger yuan would make dollar-denominated commodities (crude oil, most importantly) more affordable for the Chinese.

Economics as a weapon can be powerful, but the U.S. embargo against Cuba proves that it works only if most everyone else joins you. Furthermore, as the Hawley-Smoot Tariff and the resulting retaliatory tariffs showed, a nation tends to hurt itself at least as much as the target. For all these reasons, any nation following Mahathir's "vision" would find itself quite alone, and likely quite ruined. And after all history's warnings, it doesn't matter whether any Muslim leaders have "the will to change currency": besides the fact that the princes need American customers' dollars to live extravagantly, Muslim nations by themselves don't have the clout anyway. They're not major holders of U.S. debt, their oil sales aren't enough of the global economy to make them serious players, and they'd only hurt themselves in the process. The idea that they could seriously harm the United States, with its Strategic Petroleum Reserve and untapped reserves (a big supply shock like the 1970s would push Congress into opening up ANWR), goes hand-in-hand with their delusion of installing a caliphate in Washington, D.C.: they might hit us hard, but they'll knock themselves out with their own blow.

Thank God that Mahathir isn't anyone's chief economic advisor, otherwise he could bring a country to shambles as Robert Mugabe has done with Zimbabwe. If Krugman is correct that Mahathir is "as forward-looking a Muslim leader as we're likely to find," then there's no hope at all for the Muslim world.

He's the new king...of the socialist moonbats

I wanted to discuss this last weekend but haven't had the time to address it properly. Like any good socialist leader, Hugo Chavez is never short on half-truths, damned lies, and economic ignorance. Can we expect anything else from someone so paranoid that he accuses the U.S. of planning to invade his country and assassinate him? (The latter was long before Pat Robertson suggested it, which mainstream media almost always took out of context anyway.) And, of course, Chavez again blames capitalism for just about everything.

Chavez: World Faces Major Energy Crisis
Sat Oct 15, 7:15 PM ET

SALAMANCA, Spain - Venezuelan President Hugo Chavez said Saturday that the world faces an energy crisis but there is little chance of his country and other OPEC members increasing production because they are already pumping near "their capacity."

"The world will have to get used to a barrel price, I think, of above $50, and energy will have to be saved," he told reporters as leaders from Spanish- and Portuguese-speaking countries met in this central Spanish town.

After soaring in August, crude oil prices have been between $60 and $70 a barrel for more than a month.

"We're at the doorway of major energy crisis worldwide," Chavez said. "We'll have to develop other resources such as wind, solar and nuclear energy naturally for peaceful purposes." He said Venezuela was in talks with Argentina and Brazil regarding nuclear power.

"Prices will continue to rise but oil is running out," he said.

Chavez said a "lack of imagination in the United States and the war in Iraq, which has destabilized the market in the Middle East, has also driven up prices." Increased demand from countries such as China and India is making the problem worse, he said.

"The whole world right now is producing petroleum at their maximum capacity," he said. "In Venezuela, for example, we can't produce a single barrel more."

Venezuela, a member of Organization of Petroleum Exporting Countries, is the world's fifth largest oil exporter and a major supplier to the U.S. market.

Venezuela's state oil company, Petroleos de Venezuela, says it pumps 3.2 million barrels of crude oil a day. But industry analysts put the figure lower, saying the country has never fully restored output since an extended strike in 2003 that sought to force Chavez's resignation.

Increased production would not solve the price problem, Chavez said.

"The cause of the increase in the price is not in the production. It's partly the intermediaries who make things dearer. It's also because of the increase in demand and the irrational capitalist consumerism model," he said.

"The United States for example, with scarcely five percent of the world's population, uses almost 25 percent of the petroleum and combustion fuels produced in the world," he said.

The arrogant central-planning bureaucrats of Hayek's essay "The Use of Knowledge in Society" could not be more perfectly represented. Typical of socialists, Chavez erroneously believes that he has perfect knowledge, or at least such extensive knowledge (compared to the rest of us) that he can predict a barrel price for oil, that the world is on the brink of an "oil crisis," and that his nation is producing oil at 100% capacity. When anyone learns of his qualifications to make such statements, please let me know.

Chavez claims that Venezuela cannot produce any more oil. The article notes that industry experts don't believe Venezuela's production is what it was before its disruption two years ago. However, we'll even put aside Chavez' ignorance of his country's own oil industry. Even if Venezuela were producing oil at maximum capacity, it could certainly produce more -- if offered enough money. If oil reached $100 per barrel, Venezuela would start drilling in oil deposits that before were not worthwhile, but are now profitable because the oil can be sold at a higher price. That's the power of markets: offer someone a sufficiently high price for a good or service that you want badly enough, and it will become feasible to provide it. Offer enough if you really, really want it, and someone could probably, given enough time and money, genetically engineer a turnip with a drop of blood inside.

Don Luskin reminded us last year that global oil reserves keep increasing through the years, but the energy doomsayers still maintain we're running the wells dry. As I mentioned in my entry about Malthus' philosophical descendants, OPEC nations are investing a large portion of their profits in developing new oil fields. Instead of wringing their hands and warning about energy crises, they're always looking to expand their capacity. More recently I pointed to, as part of a large entry, an article describing the technological development so that someday we might extract 1 trillion barrels of oil in the western U.S. -- locked away in shale. Even if it will never be feasible, in the meantime we might develop a cheap, efficient source of energy, whether undiscovered or currently known. Who is to say? Certainly not Chavez and the the other delusional central planners.

Granted it's not a precise quote, but the article did say, "Increased production would not solve the price problem, Chavez said." Chavez then proceeded to blame "intermediaries," increased demand, and capitalism. Is he that blind to the laws of supply and demand? The increased demand is precisely why oil suppliers are always looking to increase their output; the higher prices are their incentive, and as I've said before, the fact that they don't want oil to get so expensive that its substitutes become economical. Moreover, Chavez doesn't understand the very role of "intermediaries," i.e. middlemen: they reduce the total cost of making transactions by facilitating deals between buyers and sellers, but they lack the significant power over final prices that Chavez thinks they have. No matter how much a broker tries to profit, by definition the buyer will still not pay more than what he deems the item is worth. I addressed that in "Rising oil costs: still nothing to worry about" and then in "The power of markets" as a semi-follow-up.

Chavez brought up a tired and wholly fallacious accusation, that the U.S. uses a larger "share" of the world's resources than its percentage of the global population. First, Chavez forgets that what's "fair" is that an entity (whether an individual of a nation) uses however much of a resource as desired after paying an agreed-upon market price. Being a certain percentage of the population has nothing to do with it. I, for example, eat more red meat than the typical American, far more than my "share," but I'm willing to pay for it, whereas others may prefer chicken. My boss at my previous job was shocked at how often I eat beef. Surprisingly, my recent cholesterol test came back 172, not 1172.

Second, Chavez is still wrong when we determine what is actually "fair." Despite high oil prices, U.S. economic growth through 2005 will be very strong: GDP will be well over $12 trillion. That's more than a fourth of the $44 trillion that the IMF estimates for global GDP in 2005, so if we want to be as nonsensical as Chavez and implement any "fair share" standard, then the U.S. is actually entitled to use more oil. And how much oil does Venezuela use? How much more than his "fair share" does Chavez use to live far more comfortably than the average Venezuelan?

The problem isn't with the "irrational capitalist consumerism model," but with a socialist, central-planning government that keeps people poor. Don Boudreaux recently blogged about how Niger's government keeps its people in economic serfdom; I have detailed how Robert Mugabe economically enslaves the poor of Zimbabwe. Chavez seems to be taking a page out of their book. Nearly half of Venezuelans already live in poverty (straight from the World Bank's mouth), and Chavez wants to make them effectively more poor by forcibly increasing Venezuela's use of more expensive wind, solar and nuclear energy instead of petroleum. It's an elementary conclusion that the three are more expensive than petroleum: if they were cheaper, Venezuelans would already be using them. But Venezuela has tremendous oil wealth, so wind, solar and nuclear energy would have to be extremely cheap to be price-competitive.

So why does Chavez persist? Insanity? Stupidity? Arrogance? Evilness? All four? What we do know is that he's following all too well in the footsteps of previous state planners, most notably Lenin, Stalin, Mao and Kim Jong Il. He just hasn't caused millions of people to starve to death. That's only because Venezuela can abundantly supply a commodity that's in high global demand (oil is about 80% of Venezuela's exports). That has still hardly helped the third of Venezuelans who live in extreme poverty, despite Chavez's professions of anti-capitalist, socialist-egalitarian ideals. Besides, mineral wealth, as we've seen in Zimbabwe and other nations, is no guarantee of keeping the people from starving when a socialist ruler sets his mind to things.