Sunday, November 30, 2008

"Autoworker chief pleads for government to save his job by stealing others' money to give to him"

If the truth were required of mainstream news publishing, that would be the real title, not this "Autoworker chief pleads for government aid" mendacity. Like any other labor leader, he doesn't genuinely care two bits' worth about the actual workers. He wants the bailout because if the American automakers go under, so do all those union jobs, and then there go the union dues that pay for his cushy job.

If you want to know how well an American automaker bailout will go, look no further than AIG, which made the very same claims: "too big to fail," "bridge loan," "we need time to reorganize." The government gave AIG an initial $85 billion infusion, described as a "loan" -- which doesn't make sense, because loans are made to be repaid, and AIG wasn't expected to pay it back. It does make sense when one realizes it was all a bait-and-switch: the government didn't intend to make a real loan, but to buy out a strong controlling portion of AIG. And as scary as it should be to any liberty-loving person, it was merely a prelude to nationalizing the rest of the major insurers and other big industries.

And by the way, do the math: if you get 79.9% ownership for the initial $85 billion, then what does $152.5 billion get you? Doesn't it seem like the investment is effectively throwing money into a black hole? If you were a private investor who put $X into a badly performing company for 80% ownership, and suddenly you had a capital call for another 79.4% of your initial investment, wouldn't you start wondering if you should pull out while you can and write off the losses?

AIG claimed it would sell off "assets" to repay the loan, and the loan is necessary to keep it afloat because there's insufficient income to meet its debt obligations (in no small part from credit default swaps). If this were done by an individual, the situation would be someone who has a sudden cut in earnings, gambled away the next several months of pay, owes money right now to a great many people, and has been refused by banks for a loan to repay his existing debts. He just doesn't have the income to repay the latest loan. AIG effectively said it needed a payday loan for the next six months, which it will use to pay off the people currently breathing down its neck, and it will repay the latest loan by selling its furniture. Ask yourself: who in his right mind would become the next creditor to such an irresponsible person? No rational person would.

As I've said many times before, there's a reason the private sector wouldn't touch AIG, banks or the American automakers: nobody wants to for the kind of promised returns. Banks might give some returns, but most private investors don't judge it to be enough to warrant the investment. And in the case of AIG and the automakers, the probability of bankruptcy is so high that no private investor wants to take that risk. Government can take the risk, though, and have no qualms about it: it's other people's money, after all. The U.S. Treasury said, "It gives the company the room it needs in its capital structure to execute its asset disposition plan."

So it's even more ludicrous: what bank would lend you money to repay debts that you owe others, when you likely can't repay that latest loan, and then the bank will loan you an additional 79.4% of the initial amount so you can repay the entire loan?

The absurdity of the AIG bailout is astounding, and we can expect no less when the automakers are bailed out. The feds have their blueprint to follow for any future bailouts.

Although the raw numbers and economic analysis show that the bailouts are a bad idea, let's put aside all economic theories of "efficiency," "sustainability" and the most nonsensical notion, "too big to fail." The only argument is a moral one: I and others are being forced to pay taxes to support others' livelihoods. Whether or not we'll do business with the companies is irrelevant. Chrysler has received my money four times, but that's beside the point: any money they receive from me, like with any other seller, should be perfectly voluntary. It should not come under the pain of death -- your death at the hands of government, should you refuse to hand over what you rightfully earned. At this point, I'll probably refuse to buy another "American" car just out of principle.

Moreover, as so beautifully stated here (do yourself a favor and read the whole thing),
Corporate bailouts are clearly unfair to taxpayers, but they are also unfair to the successful firms in a particular industry, who are implicitly taxed and burdened when their competition is subsidized. In a properly functioning market economy, the better firms—the ones that are more innovative, more efficient, and more popular among consumers—gain market share or increase profits, while the lesser firms contract. This process ensures that limited resources are used most productively.
And the Heritage Foundation explained why failure is necessary here:
Third, bankruptcy is the only way to restore innovation to the U.S. auto industry. In the end, the automakers make money by producing vehicles that consumers want. But any government money is sure to come with strings attached. Pelosi, for example, said the government would exact a “[7] recoupment” for any investment of taxpayer funds — specifically, a say in what kinds of cars it produces. That’s a recipe for certain failure and future bailouts. Bankruptcy, in contrast, strips a company down to its valuable assets and then sets to putting those assets to work in the marketplace. Whether it works or not, it’s the best chance for success.
That piece also mentioned that GM's market capitalization is down to $2.5 billion ($3.2 billion as of Friday's market close), so shareholders "wouldn't lose much." Not exactly, because shareholders who bought in at its $30 peak within the last year, or at its peak of $87 in January 1999, would lose a lot. But the point is still a fair one: GM is already so hammered that if it disappeared completely, that's only another 0.022 percent of the $14.5 trillion U.S. economy.

Let's put the market cap into perspective: GM is up to losses of $1.5 billion per month. What other company can lose 47% of its market cap each month and still stay open, or even be considered salvageable? A company like that is clearly too incompetently run and beyond all hope. Let it die.

Would additional jobs disappear? Certainly, as things realign themselves. Local supermarkets might lay people off, as autoworkers lose jobs and don't spend as much (or maybe move out of the area). A financial advisor might get canned when his client assets fall below the company quota, because laid-off people liquidate their retirement savings and maybe personal accounts. Some car dealerships are even shutting down because they aren't selling enough cars. That's life. You open yourself up depending on the personal and business associations you choose, so it's imperative that you exercise sound judgment -- and accept resulting risks -- about basing your job on a single industry or group of people in your area. As they go, so do you.

But state-worshippers believe in equality of outcome and want to ensure that no matter how incompetent you are, no matter how unproductive (i.e. lazy) you are, you'll have the same "equal" outcome as those who are successful because of their hard work and smarts. Anyone with an ounce of brain would then wonder, what incentive would anyone then have to be successful? In state-worshippers' fantasy world, Toyota and Honda might as well have produced completely random innovations, giving no thought at all to what might work, instead of entrepreneurial decisions that emphasized reliability, refinement and fuel efficiency. Let's also not forget that Japanese automakers aren't beholden to the insane compensation packages that the UAW demands, which is the reason American automakers can't make any money. It's first the hourly compensation that dwarfs their successful Japanese rivals (who still seem to attract many workers, so the wages must be pretty good), and then overly generous pensions that overly optimistically depended on consistently good future sales.

As I said in that post nearly three years ago, when will we stop treating every decision of life as backed by "the full faith and credit" of other taxpayers' wallets?

Unfortunately for the rest of us, the UAW bankrolled so many Democrats that they expect quid pro quo. A bailout isn't what's being debated, but what strings will be attached, and we can expect the $25 billion to be the tip of the iceberg. Gettelfinger and the rest of the UAW thieves can all go to hell -- but not before having diesel exhausts shoved up their sphincters with someone stomping on the gas.

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Wednesday, November 26, 2008

The Reichstag fire of the financial world, part II: scapegoats and a bait-and-switch

The original Reichstag fire needed a scapegoat, and today's financial Reichstag fire is no different. The scapegoat needs to be an innocent party who was found there. He doesn't even need to be plausibly guilty, only that the public will accept whatever story the government feeds them.

Capitalism was "there" in this financial Reichstag fire, and it was "guilty" in that investors and investment managers made bad decisions, but it's hardly plausible guilt once you investigate and realize that everything happened because of deeper causes than those bad decisions. Capitalism is merely taking the blame for the "financial crisis" that government engendered and fueled.

As I explained in a comment over at Cafe Hayek,
muirgeo, I'd like you to explain how the creation of GSEs, which then "recycle" money back into lending markets and subsequently, which were THE culprits in using securitization to disguise bad assets, is "laissez-faire."

When the government is involved, there's no free market: *someone* is being pushed or pulled. You've argued otherwise around here for a long time, but that does not change the fact that any "bubbles" were purely the result of government interference in natural market happenings. If you think what's happened is the result of laissez-faire, I'd hate to see what your idea of interventionism is.

"Speculate don't produce" is what government encourages everyone to do when it gets involved in investments, whether the Mississippi Scheme of 18th century France, the South Sea Bubble of 18th century England, or the latest American "crisis."


So at what point do you think something goes from being private to being government? The answer is easy, actually: zero. Once government is involved, there's no more free market, and no more private control. "Some" private ownership doesn't count; it's still a government operation.

If Fannie and Freddie had been fully private corporations, investors would have never had the confidence they once did, and the GSEs consequently would have never gotten to this level. But investors had far more faith than was warranted, because there was always, always the implicit promise of a federal bailout. No matter how "privatized" they were on paper, the feds would never let them fail. That moral hazard prevented rational decision-making by both investors and Fannie and Freddie's executives.
But for decades we'll assuredly hear continuously that "capitalism failed, just like it failed in the late 1920s" -- except that then, as now, it was government intervention in markets that created a bubble, caused a crash, and made the crash worse. Even today, many of our children are taught the myth that "FDR saved capitalism" when the New Deal only made things worse, and not even World War II spurring manufacturing output could pull the U.S. back into prosperity.

I've tried explaining to a certain state-worshipping twit that the New Deal didn't work, for if it did, why was there a "Roosevelt recession"? All he could do was point to GDP, which was an artificial increase. When you look at other indicators that Keynesian policies cannot inflate, like unemployment, business investment, and unemployment, the New Deal didn't exactly put people to work like it's believed today. I disagree with Boudreaux on one thing: I still maintain FDR did indeed make things worse, not just prolonged. But don't take my word for it. The Treasury Secretary at the time, Henry Morgenthau, himself admitted unemployment was still bad -- back to square one with a much greater national debt (which is what I mean by "worse"). Tyler Cowen explained why the New Deal didn't work (quite an amazing thing to be published in the NY Times!), and he previously linked to papers explaining why World War II didn't help the economy, either. Robert Higgs in October had provided his own explanation of why the war did nothing.

It still doesn't matter how much we debunk flawed history and historical interpretations. People are so brainwashed that the vast majority of future Americans will readily swallow the "Capitalism failed!" mythos about the current government-manufactured crisis, as most Americans do today about the government-manufactured Great Depression. Capitalism has been the easy scapegoat for at least 80 years (a century if you want to count the events behind the creation of the Federal Reserve). Even government isn't stupid enough to deviate from a winning strategy.

What makes current circumstances a little different is that we've just seen one of the most devious bait-and-switch schemes ever played.

At first George W. Bush, Hank Paulson, et al, decided that the Treasury would buy up several hundred billions dollars worth of "distressed securities" -- which private investors correctly wouldn't dare sink money into, at least not at what the federal government is offering. To paraphrase Milton Friedman, isn't it amazing how you're willing to offer so much more, and take a huge risk, when you're spending other people's money? The feds could offer far more on the dollar than private investors would risk, and we should see warning signs when even Warren Buffett, a proponent of the bailout, was putting $5 billion into Goldman Sachs instead of these bad assets.

Oh, but not only mortgage-backed securities, it was quickly decided, but maybe the bailout could extend to bad credit card loans, student loans and auto loans! By this point, you couldn't even call it a "farce" -- it was not just absurdly beyond "bailout," but starting to dwarf any other federal giveaway, ever.

But then Hank Paulson announced, no, they won't buy these assets after all. What's the catch? No catch, just that the federal government will continue with buying up stakes in the top nine U.S. banks.

You have to hand it to him: that was one hell of a bait-and-switch. McQ understands that much, but he just needs to connect the dots. After observing what's really happening, we must ask ourselves the real question: why?

As I said before, it's about controlling the U.S. financial system. Not regulation, not "helping," not "ensuring fairness," but outright control. Control money, and you have the greatest control of the people. Simply put, there was never intent to buy up the "distressed securities," whether to prop up their values for investors or to "take these toxic assets off banks' balance sheets to improve their liquidity." That was all a smokescreen. The real plan all along was to start nationalizing the banking industry. It isn't just the top nine banks who received federal funds, but plenty of regional banks too.

Why the elaborate game, though? Because Americans needed to be softened up to the notion of the federal government buying up stakes in banks. They'd otherwise balk at it: it would smack too much of "socialism" to conservatives, and "fascism" to liberals. If government creates a crisis, however, or just the specter of one, its officials and allied pundits can blabber economic malarkey for weeks until the people nod their heads and say,"Uh huh, that sounds good." Most people don't have the intelligence or learning to comprehend all these grand plans, even if they'd work, and in the end they're so numb to it all that the powers of darkness can alter or drop the original plans, revealing what their true intentions were all along.

And we're constantly being told it's all for our benefit:

The actual headline reads, "Massive new programs aimed at loosening credit." But wait a minute, a bailout for whom, paid for by whom? Where is the money coming from?

This time it's from the Federal Reserve, not the Treasury, so it's not a matter of our tax dollars, right? Of course, we'll have to worry about a pesky thing called inflation, produced by central banks and central banks alone, as the Federal Reserve pumps many more hundreds of billions of dollars into the global economy.

Here's some food for thought. I was recently telling a friend that the last time the euro was under $1.30 was mid-2006, when gold was still in the $600 dollar range. So while the dollar has strengthened vis-à-vis the euro, we can still look at gold prices to see the inflation. By this particular measurement, and it's not absolute since there are others, I'm figuring about 15% inflation in the last couple of years. That doesn't affect everything, e.g. oil and gasoline prices which are falling rapidly because of expectations that demand will continue to decrease, but forget the babble about unsustainable trade deficits: inflation is never sustainable, but inflation at this high rate will produce very bad results sooner rather than later.

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Monday, November 24, 2008

Tim Geithner and Larry Summers "understand markets"?

John Batchelor, or maybe one of his guests, made a claim on the radio tonight that Tim Geithner, the presumptive nominee for Obama's Treasury Secretary, and Larry Summers, former Clinton Treasury Secretary, "understand markets." As I said the other night, this is how parents can explain the phrase "The more things change, the more things stay the same" to their children. For all his talk of "change," Obama is hell-bent on bringing aboard such insiders as Clintonistas and entrenched Fed officials.

Most Americans probably couldn't tell you who Larry Summers is, or if they can, they don't know him beyond the Harvard controversies. Geithner is even less well-known, and Americans should be truly shocked to learn how personally responsible he was for this "financial crisis." I knew nothing of the man prior to his nomination, but all I needed to know was his specific position at the Fed, and I immediately realized what the man himself has done. The New York Federal Reserve Bank is responsible for the Fed's "open market operations," which is how the Fed distorts interest rates and the dollar's exchange rate. Geithner has been its president since 2003, and he and his predecessor William McDonough bear personal responsibility for doing Alan Greenspan's bidding of low interest rates.

As I wrote last May, Congress threatened mortgage lenders with the stick of investigations and regulations, if the lenders didn't give money to unqualified applicants, and borrowers were irresponsible to take out loans they should have known (and often did know) they couldn't repay. Both of them should bear blame for the housing bust. But it was the Federal Reserve who is mostly to blame, because only it could provide the carrot that facilitated all this: interest rates far too low for far too long, anywhere from 4-plus to 6 years, depending on whether you draw the baseline at 4% or 5%.

The Fed's sudden interest rate cuts began in 2001, a quick reaction to the last year and a half of tightening interest rates. It's much like when I was 16 and first learning to drive. Traveling 55 in the center lane of a highway, the teacher warned me that I was starting to drift into the left lane. So I mindless jerked the steering wheel to the right, and quite quickly. I kid you not, we felt the left wheels go up six inches and then plop back down on the road. It scared the crap out of the teacher, who said "Goddamn it, Perry, don't ever do that again!!!" I understand he was still telling the story for years and probably still does to this day. Well, my idiotic maneuver is exactly how the Fed bankers do their own operations: they're not paying attention (Hayek would remind us it's because central planners can't possibly have all the information to determine what interest rates should be), suddenly discover they need to correct course, and then just as suddenly do something boneheaded because they never knew all along what they're doing.

So back to this thing about Geithner and Summers "understand markets." If they really understood markets, then they'd know that free markets exist only when government doesn't interfere. The moment that government does an iota in "markets," they're no longer free, and hence only a semblance of "markets." Geithner and Summers are chief proponent of government interference. Summers' very job under Clinton, by definition, was figuring out ways for the federal government to meddle with financial markets. Geithner's assuming that role after having been on the other side: as Treasury Secretary, he'll be working with his successor at the Fed about how many Treasury securities the Fed will buy or sell.

If Geithner and Summers don't really understand markets, it means they're very dangerous in their ignorance. If they do understand markets, then they're misguided or perhaps malintentioned in their jobs that subvert markets. I wouldn't doubt that they understand markets, although in the same way that Satan understands what God wants: "Thou believest that there is one God; thou doest well: the devils also believe, and tremble." One can "understand" but still not believe or heed.

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Sunday, November 23, 2008

Hypocrisy, thy new[est] name is Bill O'Reilly

"When you're a "culture warrior" and you're pissed off by something sexy on the TV, what do you do? Why show it again, in its entirety!"

Indeed! Despite all his self-righteous ranting that this Guitar Hero commercial, featuring Heidi Klum in her underwear, could be seen by children, he found the, ahem, personal integrity to play it twice. It's like when my father would joke about eating a new ice cream: "I don't recommend this. I'm eating it only to build my character."

"I don't know what [Guitar Hero] is. Is that a, is that a video game? Is that a video game? ... Oh it is. Those things frighten me."

Here's a man who's still stuck in the 20th century. The mid-20th century. You don't have to like something to know what it is.

"No one cares if you're offended. Is that appropriate for broadcast TV?"

He said the two sentences as if they're unrelated. He stated the first to whatever-her-name-is, then asked the second sentence in an absolute sense. That's because he is offended, and he must therefore stop it: he might as well told her bluntly, "Who cares what you think, it's what I think that's important!"

I suggest that if O'Reilly is truly bothered by offensive imagery, and he can't bring himself to change channels, then let him move to Singapore, where the government will "protect" him from all forms of harmful speech and images.


A note to Abraham Biggs Sr.: go off yourself also

If that's how you truly feel, then do the rest of society a favor: go join your son. You'll get not a whit of sympathy for me, not after your idiocy of blaming everyone.

1. It was not up to the rest of us to save your son. He was his own person. If a person really wants to kill himself, there's nothing the rest of us can do.

2. You said, "It's a shame I wasn't there to help him." Is that all you can say, "It's a shame"? This was your son, you stone-hearted asshole. If it were my son, I'd be too grief-stricken for weeks to make more than five words in comment.

3. The rest of us don't live there. You live there, and your son died in your bed. So where were you when your son needed someone? Are you so emotionally removed from your own seed that you didn't see or heed any warning signs?

Police didn't arrive until 12 hours after the suicide announcement. Didn't anybody in your household think to check on him, or do you customarily leave someone alone for half a day? He was 19 years old, on prescription medicine, apparently doing nothing all day but surfing the WWW. Nobody wondered where he was when he wasn't seen even to get food in the kitchen?

Oh, but you were "working"...just what do you think the rest of us do?

4. People who announce suicide intentions tend to be craving attention more than death. Your son was the boy who cried wolf, so why should anyone have taken him seriously?

5. If you think it's easy to send over the police when someone threatens to kill himself online, you're a complete moron about life, not to mention clueless about modern technology. You're assuming that the police will take this seriously: why should they divert scarce manpower when the kid could be crying wolf again?

And at minimum, to track the person, the website operator must be notified. Responsible admins just don't hand over IP addresses to anyone who claims to be law enforcement, no matter how "urgent" the matter may seem, so the police department's credentials must be verified. Then the corresponding ISP must be contacted, meaning law enforcement credentials must be verified again. This all takes time.

So your son had mental problems, which I suspect is because you couldn't raise him properly, and you want to blame and "regulate" the rest of us for your own shortcomings?

Go to hell, asshole. The "shame" is that you didn't die instead of him, because if anyone is to blame, it's you.

Tuesday, November 18, 2008

Our first affirmative action president will give us our first affirmative action Attorney General

It looks like Obama will nominate Eric Holder, a relic of the Clinton Justice Department, to be his Attorney General. Well, parents, you should have no difficulty explaining to your children the meaning of "The more things change, the more they stay the same."

After the campaign of faux outrage that attacked racism where it never existed, we have the news that just won't stop bringing up the non-issue of race:
If nominated by Obama and confirmed by the U.S. Senate, Holder, 57, would be the first African-American attorney general. President-elect Obama has made it clear that Holder is his choice to run the Justice Department, transition team officials say, and staff members have been reviewing Holder's background before he receives an official offer.

He served as the first black deputy attorney general, working under then-Attorney General Janet Reno during the Clinton administration.
Whatever happened to that bit about "not be judged by the color of their skin but by the content of their character"? Haven't we had enough of race being brought up in virtually every news article?

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Friday, November 14, 2008

Even in New York, not something you see every day

I invariably walk through Rockefeller Center on my way to work. People often walk their dogs, but yesterday morning I saw something different. Click the pictures for a larger size. All I had was my camera phone; I've fallen out of the habit of carrying my regular camera with me.

And look what arrived this morning!

Wednesday, November 12, 2008

My tribute to a veteran: a day late but never too late

Last night I was just going to repost a poem I reprinted a few years ago, when I remembered my father, a veteran of World War II. I didn't get around to it, but tonight I want to acknowledge a friend. As the title says, a day late but never too late. He's been very sick, and I hadn't seen him (among many other friends) since I got married. Tonight we ran into each other on a Metro-North train. We had a few minutes to catch up, and he smiled broadly when complimenting me on my beautiful wife. I didn't know he already met her through one of my relatives, with whom he's also friends.

He was an everyday Joe who got drafted and sent to Vietnam. When telling me about the war, more than once he lamented how his platoon would be sent out in a cloverleaf outline, taking control of the area within, only to give it up later on. Almost as frequently, he warned me that Iraq was becoming another Vietnam, and it was a correct assessment while our military commanders had no idea how to occupy the country.

Early in our friendship I asked, "Did you ever kill anyone?" "Sure," came the matter-of-fact reply. "I killed lots of people." His government plucked him from upstate New York, sent him to jungles and rice fields halfway around the world, put metal, wood and powder in his hand, and told him to take others' lives.

He has this URL, but he's never hinted that he ever read a word of my blog, so here I can express what I couldn't say to his face. He probably knows already from seeing it in my eyes. "Very sick" was an understatement: he's been fighting throat cancer for a couple of years. It's currently in remission after the doctors excised a big chunk of flesh and started him on chemotherapy, but he's not out of the woods yet. His former husky self has gotten so thin, and I'm really worried for him.

He's another Demoleon. You won't find him mentioned in Wiki entries on Vietnam, and most of future generations will not know his name, let alone remember it. So in that sense he lacks Demeleon's immortality, for Demoleon was at least mentioned briefly. But my friend, when his government wanted (more like "demanded") it, was ready.


Few have heard of Demoleon, Antenor's son,
Who was slain in one of the last battles of the Trojan War.
His only distinction is that he was killed by Achilles
Immediately after Iphition and immediately before Hippodamas.

That is all. There is no other mention. Yet he was a good man and, according to Homer, a brave repeller.
The spear of Achilles took him in the temples,
Broke through the brazen helmet, and defiled the ardent brain.

Exit Demoleon, after ten years of a war.
He went through nine of them quietly, kept his armor
Polished, his tunics patched, his men (what were left of them) fed,
Saw Helen in the streets often, had nothing to say to her.

He was a competent fighter, but no hero;
He had to be quick to have lasted as long as he did.
Too bad that Achilles on one of his good days caught him
And shipped him off to the casualty lists and an immortal name.

It is not known what happened to his body.
Dogs got it, perhaps, though it is to be presumed
That is wife and children, granting, of course, he had any,
Became slaves in, say, Argos. And Troy, of course, went down.

Exit Demoleon. Exit Achilles. Exit the walls of Troy.
This happened three thousand years ago in a long and silly war
And would have been forgotten five generations after
Save for a poet who was blind and whose birthplace no one knew.

The odd thing about it is that there was no death.
Demoleon did not die. Achilles did,
But this was because Achilles was Achilles. Only one like that. But Demoleon was only a name on a list.

The names on the list never die. They are always around us.
We see them standing on corners or walking along a road.
When we want them they are ready. They don't have much to say,
But they say it when the time comes and they say it very well.

Demoleon, perhaps, was the captain who dressed down the driver at Ypres
And whose face looked vaguely familiar. Yes, he was on the next day's list. He was also the man who sprawled
Across the bombed parados, whose letter was seen in the mud.

He's still around. He keeps his equipment clean,
Patches his clothes when he has to, feeds his men,
Sees a woman named Helen on the street and does a double-take,
Can last a long time if he has to, and probably will.

And someday he'll catch an Achilles off his feed.
It will then be another story. He's waiting, and game to try.
Bronze has gone by the board and spears are out of fashion.
The casualty lists are much more prosaic now.

Only scholars have heard of Demoleon, Antenor's son,
Who was slain in the last cruel year of the Trojan War
By Achilles, the son of Peleus. Achilles had a heel
That white Paris pierced with an arrow. It sent him to the shades.

- Harry Brown

Sunday, November 09, 2008

I wonder what that Chinese regulator has to say about China's "stimulus"

Several weeks ago, I mentioned a Chinese banking regulator who points at the United States' problems but ignores that China's were always far worse.

China is going to pump four trillion yuan, about U.S. $588 billion, into its economy as a "stimulus package." One of the most rapidly expanding economies needs a stimulus package, though in this year's "slump" it will still see a projected 9% growth in GDP?

Yes. Make no mistake: there may not be tens of millions starving under a "Great Leap Forward," but China's leaders are ever committed to central planning. They want to meet their production targets and will do anything they deem necessary -- easily done when the rulers are perennially well-fed, and the "proletariat" do the real work. Recall that under Chairman Mao, Chinese were so desperate to meet their metal production quotas that they would smelt the tools they needed for farming. The choice was between a near-100% probability of slow starvation or a certain 100% probability of dying in a gulag. Today's Chinese largely don't face the risk of starvation, but do not doubt for a second that the gulags aren't running today with ever greater efficiency.

You might think, well, at least China has a tremendous budget surplus to use for the stimulus. But China needs its surplus to continually add to its foreign currency reserves, particularly U.S. dollars in the form of U.S. Treasury securities, as collateral for its corruption-ridden banking system that would otherwise collapse. What it comes down to is that China is addressing only a short-lived economic condition at the expense of the underlying problem (bad loans) and its longer-term economic health -- just like the U.S. government and Federal Reserve have been concerned about quarter-on-quarter economic growth, ignoring the long-term burdens of using massive new federal debt to buy up bad securities.

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A curious admission on the local news channel

No link, but this is the precise quote from a piece on world celebrations: "Now this poor African nation [Kenya] can claim one of the world's most powerful leaders as one of its own."

Oh really? So are they saying it's true that Obama's not an American citizen? Or are they saying his loyalty is to Kenya?

Most likely they don't even care that Obama is of African descent. They're just full of "hope" about Obama's Global Poverty Initiative (and when you Google it, the search hint comes up with "global poverty initiative obama"), and though Obama being a mulatto means he'd probably support the program more than a white politician, Kenyans would be just as happy if it were a white president who pushed hard for it.

The GPI is pure socialism, just like everything else Obama champions: the U.S. will give 0.7% of its GDP in "foreign aid," which Kenyans outside government circles are stupid enough to think will be distributed to them. Even if the U.S. economy doesn't grow beyond the current $14.4 trillion annual output, the GPI means $100 billion a year that U.S. taxpayers must give to the rest of the world, or putting it another way, the 100 million of us who have significant tax liability will have to cough up $1000 each! And even if the money were willingly given, at best, look what happens when aid distributors actually make the deliveries (remember that virtually all government-financed "aid" is distributed through UN or UN-allied channels). At worst, it will be like North Korea, Zimbabwe or Saddam's Iraq: aid will be kept by the government, and distributed to the dictators' supporters and/or sold for ready cash.

And then news showed..."Obama as Che" T-shirts. Wunderbar. Will Obama try to exceed Che's body count?


End of a legend's career

Roy Jones, Jr., was defeated last night in the light heavyweight championship bout. The unanimous decision more than suggests that Jones should look forward to a quiet retirement. At 39 years old, it's unlikely (but not impossible) that he'll make a second comeback.

Not the best end, but no boxing fan will remember only his last fight. What a career, and what ability to change weight classes.

Saturday, November 08, 2008

The world congratulates Obama

Fidel Castro, Madhmoud Ahmadinejad (a.k.a. "Madman Mahmoud the Used-Camel Salesman of Tehran"), and even Burma's head dictator are congratulating Obama on winning the election.

Doesn't it warm your heart to think on how enemies of freedom, and an avowed enemy of America, love our president-elect?

Saudi columnist Dawood al-Shirian wrote, "Americans have struck a deadly blow to racism all over the world." Oh? So when Obama received congratulations from the leaders of the UK, France, Germany, Spain, Italy, Greece, Poland, Egypt, and Pakistan, we were merely following in their footsteps, right?

In all those countries, the highest-ranking blacks I know of are Rama Yade, France's junior minister for human rights, and Jean Léonard Touadi, who only this year was the first black man ever to be elected to Italy's Parliament. So to whosoever in these aforementioned countries wants to make our 2008 presidential election into a racial issue, perhaps you ought to look at your own governments first.

And when will South Africa overcome its racism by the overwhelming black majority electing a white man?

Note: I don't really care about any racial aspects of the election. I'm just pointing out others' hypocrisy.

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Thursday, November 06, 2008

And yet another libertarian falls for the race guff


How many times can I ask this? Why is Obama's skin tone a factor to any degree?

Libertarians, more than anyone, should believe in meritocracy. But I'm finding more and more self-professed "libertarians" who like the fact of our first affirmative action president.

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The photo is genuine, saved from Yahoo News last night. Thanks to my friend [name redacted to protect him from assured retribution by Obama supporters] for adding the ET-like glow.

You can make your own demotivational posters at


Wednesday, November 05, 2008

Again, just who is making it an issue of race?

Donovan McNabb is. Indeed he can relate to Obama -- it's true! Both are fine examples of someone not as talented as he or the general public thinks he is, but (Rush Limbaugh was right) the media so wanted a black man to "do well" that they made a mediocre one out to be more than he really was.

I previously linked to my comment at QandO, where I wrote,
But now we have our first affirmative action president, whose election is some sort of "reparations" for the past. And like any other affirmative action beneficiary, the person was completely unqualified but was "helped up" because of his skin tone. Moreover, I can’t believe you, or anyone else blogging here, has yet to pick up on this: Obama isn’t like most black Americans! His white mother met an African student during the Civil Rights days, but Obama doesn’t have slaves and sharecroppers in his family. He has nothing, NOTHING in his heritage in common with black Americans who did in fact endure the likes of Jim Crow. Well, nothing except attending a "black liberation" church for two decades.
Oprah said, "I was so, so, so excited and then just sort of a calm came over me. It feels like it actually is kind of real, so it feels great." I'm still scratching my head over this one. "It feels like it actually is kind of real"? So it's not real?

Then that dolt Beyonce said nothing as follows.

I'm sick and tired of hearing and seeing "first black president" everywhere. What I care about is what the mind inside the skin will do about my liberty -- which is to say, will he leave me alone with my personal liberty?

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Libertarians falling for the race issue

See here over at QandO. Dale Franks attempted to play the age card against me, but I told him it won't work and is in fact irrelevant.

See also here at Radley Balko's blog, where I won't bother making the same reply.

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"Democrats capture control of House by defeating incumbents"

More evidence of mainstream media's laziness combined with stupidity. They had probably prepared a "Republicans capture" headline, just in case, then put in "Democrats" but didn't realize the wording was completely inaccurate.

And the incoming HNIC's words about "change" are obvious, since there would have been "change" even if McCain had won. But it's further demonstrative of Obama's mentality that somehow George W. Bush was running for re-election.

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Tuesday, November 04, 2008

I realize a lot of you are angry

For the first time in our lives, some of us are downright ashamed of our country, of what our fellow Americans are stupid enough to do. But please, please don't do anything rash.

Remember: Ann Coulter gave Joe Biden the nickname "Assassination Assurance" for a good reason.

So pray for the twin twits' safety, because after them would come...President Nancy Pelosi.


A welcome break from election coverage

Hat tip: Radley Balko.

Monday, November 03, 2008

The latest example of fine UN efficiency

No farce could exceed the ludicrousness of "UN humanitarian aid" reality. Congo refugees expected food, so what did the UN deliver instead?
KIBATI, Congo (AP) — Refugees who haven't eaten for days cheered when the first humanitarian convoy in a week arrived Monday at their camp, but the jubilation turned into anger when U.N. workers dumped soap and jerry cans instead of food and sped on past rebel lines.

U.N. officials admit hunger at the Kibati camp, where tens of thousands of refugees have sought safety, is dire but say their first priority is resupplying clinics looted by retreating government troops.

"Are we supposed to eat this?" asked Boniface Ndayumujinya, an elderly man who waved a bundle of spring onions delivered by a friend. He said he was with eight family members who had had nothing to eat in five days.

U.N. peacekeepers escorted the 12-vehicle aid convoy carrying medical supplies north from the provincial capital of Goma, past Kibati, and beyond rebel lines to Rutshuru, a village 55 miles (88 kilometers) north of Goma.

Both the Congolese army and rebel leader Laurent Nkunda assured the convoy's safe passage, said Gloria Fernandez, head of the U.N. Office for the Coordination of Humanitarian Affairs in eastern Congo.

Medical supplies and tablets to purify water were the priority in this shipment, she said, adding that another convoy on Tuesday would be bringing food for some of the 250,000 refugees displaced by fighting in this central African nation.

She said health clinics north of Goma have been "looted and completely destroyed," leaving the Rutshuru hospital as the only operating medical facility in a region of hundreds of thousands of people.

The soap and plastic jerry cans for water distributed in Kibati on Monday were meant to help with sanitation amid fears of a cholera epidemic.

Food, however, was the critical issue for most people.

"Everybody is hungry, everybody," said Jean Bizy, a 25-year-old teacher who watched with envy as the U.N. convoy stopped to deliver a sack of potatoes to U.N. troops in Rugari. Bizy said he has been surviving on wild bananas for days.

Onesphore Sematumba, of local think tank Pole Institute, watched with horror as thousands of children lined up in the sun for hours at the Kibati camp to get tokens that will allow them to queue for high-energy biscuits.

The children thought they were waiting for the biscuits.

"We really need to re-think humanitarian aid," Sematumba said. "If you can't help people, don't create false hopes."

U.N. officials said the token system was necessary because of the unrest that broke out when aid workers tried to distribute biscuits directly.
Jesus said, If a son shall ask bread of any of you that is a father, will he give him a stone? or if he ask a fish, will he for a fish give him a serpent? Few could fulfill this like the UN.

I'm probably the most fastidious person in the world about washing thoroughly before I eat, so I extol the importance of soap as much as anyone. But what good will it do these refugees, who can look forward to literal starvation with clean hands? What good does sanitation do them?

The reasoning behind the "token system" is completely absurd. If there will be "unrest" when people directly receive biscuits, there will surely be unrest in the second round when people actually receive the biscuits. And isn't their desperation understandable? They're hungry, and it's greatly exacerbated because the people expected to bring food are instead bringing soap!

However, there's probably a sinister sort of logic behind making people stand in line twice: I suppose the crowds will be far more manageable when half of them don't survive to queue a second time.

How to subjugate a country, quietly and from the inside

1. Disarm the populace. Breed people to rely on law enforcement instead of their own skills and equipment to defend themselves. This is crucial so that when people realize what's going on, it's too late. For that reason, this must be done with ultimate subtlety as the first step, slowly over many years.

2. Control of the money supply is essential. Once you control it, you control the economy. Recessions and depressions can then be engineered, so that government can step in to "rescue" people from what it claims are "free market" failings.

3. Also, a government that controls the money supply can perform as much deficit spending as necessary for domestic spending and waging war, because money can be created at will, anytime, for the Treasury to borrow. For best obfuscation, claim that the central bank is a separate, "private" entity, and in fact "necessary" to ensure "monetary stability" -- which turns out to be fixing the crises that it creates in the first place.

4. Use the spectre of "crisis" -- create one if necessary (see step 2) -- as a pretext for nationalizing all the major industries. Education facilitates control of the young, allowing you to breed successive generations of obedient sheep who will fall for whatever political rhetoric you offer them. Energy facilitates control of people's transportation behavior. Insurance. Health care. And banking controls everything about people's ability to do commerce. Of the five, it's the most powerful as a weapon for punishing political dissidents.

Once you've done these, you're in control of a country. No formal conquering via military force, no revolution, and it happens so gradually that people can't pinpoint a certain time when liberty was lost.

Who has ears, let him hear. Who has eyes, let him see. Aren't the signs already so obvious?

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