So many leftist pundits are spouting off about the death of capitalism and how Greenspan was a libertarian so that proves that free-market policies don't work. Well, bullshit.
Greenspan was not a libertarian, he wasn't even an objectivist except perhaps in his youth when he contributed to Capitalism: The Unknown Ideal and advocated a return to the gold standard. But, of course he sold those views out right quick when they threatened to dampen his career goals. No, Greenspan was a soulless mercenary, who knew enough to know what was the right thing to do, and then did the wrong thing anyway. There can be few more damning indictments of a person's moral character than to knowingly choose to do the wrong thing.
As for the so-called failure of the free market system, well our market was not free of government intervention before, so it baffles the mind to think how people can actually convince themselves that we were actually under a free market system before this whole crisis developed. Of course it didn't help that Republicans were preaching free market principles while expanding government like there was no tomorrow, but all that proves was that the majority of Republicans were and still are hypocrites. At least if they have the sense to rally behind Ron Paul this time, perhaps we may see some change for the better. But with all the new legislation that Obama and his gang are going to be able to cram through the legislature, it's a bit like closing the barn doors after the horse has already fled.
Anyway, there's a very good article by objectivist Dakin Sloss over at the Stanford Progressive. It's a very succint and easy to understand explanation of how the government was involved in the economic collapse. I highly recommend it, so please check it out:
http://progressive.stanford.edu/cgi-bin/article.php?article_id=343
Best premises,
American Anti-theist
Translator
Showing posts with label crisis. Show all posts
Showing posts with label crisis. Show all posts
Friday, May 8, 2009
Friday, March 20, 2009
Why I'm an Objectivist
Well, I guess that Ayn Rand's books are experiencing a surge of interest due to the economic crisis. But amidst all the pundits weighing in on one side or the other, I'd simply like to talk about why I'm an Objectivist.
A lot of people point out that Greenspan was an Objectivist (he even wrote several of the essays in Capitalism: The Unknown Ideal). But the policies and decisions he pursued in his career make him anything but. How can the chief of the Fed, who sits in unilateral judgment over the arbitrary outlay of interest rates and the monetary supply, possibly be supportive of the government deregulation of the financial system? No, Greenspan isn't an Objectivist.
A lot of people get hung up on that deal with the Brandens, or with the Peikoff-Kelley split. The former is a sideshow bearing no relevance to Ayn Rand's philosophical ideas. It is akin to discrediting the Declaration of Independence because Thomas Jefferson owned slaves. Somebody can make mistakes in character judgment, or bad choices and still have good ideas. That's why there is a logical fallacy devoted to just such an error, ad hominem (meaning against the man). The latter focuses on a very relevant issue, the proper moral response to dissent. I'm honestly not sure which side is correct in their assessments, as I've recently stated, I'm not sure myself how to properly discern between evasion and deception and whether or not there should morally be a different response for the two, or if they deserve to be lumped together. This jury of one is still out on that subject, and until I reach a verdict, I will be hesitant to condemn either side unilaterally. After all, error is a very real occurrence. To deny the capacity for error is to assert that we are all granted a priori knowledge of the universe, an assertion closer to the philosophy of Plato than that of Rand. And I don't believe in patently accepting orthodoxy from any source if I don't fully understand the principles involved.
Some people assert that Rand has a utilitarian value, that she provides the moral justification for capitalism. Well, she does. But that isn't a reason to believe in Objectivism. The only viable reason to believe in Objectivism is this: is it true?
To ask this question of most philosophies is to encounter a Cartesian loop of circular reasoning. Most philosophies demand that you accept either a God, or social force, or some vague and inexplicable internal sense as the final arbiter of morality. Only Rand came forth to say that what is moral is based solidly in the tangible reality and tangible demands of our physical existence. The reason philosophers scoff at Objectivism is because it is fully comprehensible. The reason why it isn't taken seriously is because it does not rest on a leap of faith, a "feeling" that something is right or wrong. It rests on reason. Philosophers have spent generations arguing about whether they can know that reality exists, how they can know anything if they can't assume anything about existence, endless wormholes of uncertainty and referenceless abstractions based on clouds of air where they simply try to rationalize their own assumptions about morality by any means necessary. There is a very real reason why we tend to think of something as "deep" which is completely incomprehensible or bizarre. It is because what many of our philosophers have presented to us as deep and fundamental truths of existence have in fact been nothing more than incomprehensible or bizarre all along.
Rand was the first one in modern history to come out and say "The Emperor has no clothes...and this is why." She stated that some assumptions are necessary, that they are in fact assumed by anyone who would attempt to disprove them: Existence exists, Consciousness is conscious, A thing is itself (A is A). Her philosophical system anticipated significant developments in cognitive science (such as the embodiment of cognitive experience and the necessity for a hierarchy of concept formation for information processing) and linguistics (such as examining the concealment of agency realized by transitivity and passivization as a technique for encoding hidden ideology). Objectivism has ramifications for economics, political science, morality, law, and education. All of these fields are traditionally presented to us as decontextualized, incomprehensible forces of nature to which we must simply react, but can never hope to comprehend or to influence.
Objectivism makes explicit the underlying mechanisms of all of these processes and shows how we are the center of all of these systems, that we are not just passive receivers of some arbitrary destiny; that we have the power and indeed, the responsibility, to act upon those systems to make them better for our own sakes. And that by working to make these systems more productive objectively, that by striving to attain our own individual rational self-interest, by seeking to attain the best that life has to offer over the entire span of one's life, that the net result is an immeasurable benefit for everyone. But that the justification is not in the benefit to all but in the benefit to one's self. That we are born into this life as ourselves, that we experience only the life that we have as ourselves, and that the pursuit of happiness is not a pragmatic end, but a moral pursuit in and of itself.
Objectivism offers HAPPINESS, whereas the other varied philosophies and ideologies of our age only demand SACRIFICE. Sacrifice to what? For whose benefit? Will my children be the happier for me having sacrificed their economic well-being today? Will I truly have any greater guarantee of security by demanding that they pay for my retirement, when in fact the economic necessities of the system will mean that social security will most likely not even exist by that time? Will they be the better educated by demanding that they be constrained to the lowest common denominator of educational quality made possible by averaging the resources of the community as opposed to what I could provide for them unfettered by the economic burdens imposed by the government? No. No. No.
Opponents of Objectivism need to make an explicit stand, one that they cannot ultimately justify and thus why they always resort to ad hominem attacks or dodge the issue. Objectivism ultimately stands for the rational pursuit of your happiness over the span of your life. It holds that as a moral virtue, the highest moral goal. To say that Objectivism is evil, is to say that the pursuit of happiness is evil. To say that Objectivism is wrong, is to say that it is wrong to be happy, it is wrong to want the best for your children, it is wrong to receive greater pay for greater work, that any attempts to advance your position in life is evil and the most we can hope for in our imperfect lives is to beg for the mercy of those who hold incontrovertible power over us, whether they be thrust into that position by design or the vagaries of the political process.
I refute this view of life. I cannot accept that I was born to be the tool of others, that I was born to be used, manipulated, milked of whatever capacity I have and then to be cast aside with the fruits of my productivity to be dispensed according to the whims of a lunatic mob. I believe in the principles that America was founded upon. I believe in this nation of principles, the only nation ever founded by philosophers. What Ayn Rand represents is not a radical divergence from American values, she represents the soul of American virtue unabashedly claiming its rightful distinction as the only moral system which does not treat humanity as sacrifical animals to be slaughtered for the sake of anyone's whims, whether they be the dreams of one man, or the dreams of us all. This virtue can only be fully realized if we accept the objective basis of morality, the objective determinants of justice and just law.
And the final reason that I am an objectivist is not just because the logical arguments makes sense to me, but that I can see the principles that Objectivism makes clear in operation in every aspect of life around me. When I see the way people react to politics, or economics, or education. When I see the things that are easy to teach or are easy to learn. The more I discover about the processes of the human mind, and society. Everything that I learn from science and my experience with other human beings in society. Everything makes sense when viewed from an Objectivist perspective. Where before, there was only a chaos of competing voices all crying for power, all crying for pity, all teetering on an uncertain foundation rocking on the waves of public opinion, I have now come to see the levers which operate those systems, and to understand the motivations driving the forces in our society. When I see the accuracy with which the themes in Ayn Rand's works play out in the news around me and even in my own personal life, I cannot refute the predictive power of her model. No other philosophy I have studied has come anywhere near as close in terms of precise clarity and comprehensive explanatory power.
And that is why I am an Objectivist. If I were to find a proof, whether it be logical or practical which invalidated the propositions of Objectivism, I would surrender the title of Objectivist and set about constructing a revised philosophy incorporating that proof. But I haven't yet. Despite all the ranting on the internet. Despite all the spite and condemnations of Rand's work. Despite all the insults and some outright lies. Not a single detractor has been able to provide a significant counter-argument. So I ask openly: if you (anybody out there at all) have an objection, bring it forth. Let's talk about this here and now. If you can show me the error of my ways, then do so. But I only ask one thing in return. That if your arguments prove to be the weaker, will you be as willing to change your views? If you are, then you're probably closer to being an Objectivist than you may think.
A lot of people point out that Greenspan was an Objectivist (he even wrote several of the essays in Capitalism: The Unknown Ideal). But the policies and decisions he pursued in his career make him anything but. How can the chief of the Fed, who sits in unilateral judgment over the arbitrary outlay of interest rates and the monetary supply, possibly be supportive of the government deregulation of the financial system? No, Greenspan isn't an Objectivist.
A lot of people get hung up on that deal with the Brandens, or with the Peikoff-Kelley split. The former is a sideshow bearing no relevance to Ayn Rand's philosophical ideas. It is akin to discrediting the Declaration of Independence because Thomas Jefferson owned slaves. Somebody can make mistakes in character judgment, or bad choices and still have good ideas. That's why there is a logical fallacy devoted to just such an error, ad hominem (meaning against the man). The latter focuses on a very relevant issue, the proper moral response to dissent. I'm honestly not sure which side is correct in their assessments, as I've recently stated, I'm not sure myself how to properly discern between evasion and deception and whether or not there should morally be a different response for the two, or if they deserve to be lumped together. This jury of one is still out on that subject, and until I reach a verdict, I will be hesitant to condemn either side unilaterally. After all, error is a very real occurrence. To deny the capacity for error is to assert that we are all granted a priori knowledge of the universe, an assertion closer to the philosophy of Plato than that of Rand. And I don't believe in patently accepting orthodoxy from any source if I don't fully understand the principles involved.
Some people assert that Rand has a utilitarian value, that she provides the moral justification for capitalism. Well, she does. But that isn't a reason to believe in Objectivism. The only viable reason to believe in Objectivism is this: is it true?
To ask this question of most philosophies is to encounter a Cartesian loop of circular reasoning. Most philosophies demand that you accept either a God, or social force, or some vague and inexplicable internal sense as the final arbiter of morality. Only Rand came forth to say that what is moral is based solidly in the tangible reality and tangible demands of our physical existence. The reason philosophers scoff at Objectivism is because it is fully comprehensible. The reason why it isn't taken seriously is because it does not rest on a leap of faith, a "feeling" that something is right or wrong. It rests on reason. Philosophers have spent generations arguing about whether they can know that reality exists, how they can know anything if they can't assume anything about existence, endless wormholes of uncertainty and referenceless abstractions based on clouds of air where they simply try to rationalize their own assumptions about morality by any means necessary. There is a very real reason why we tend to think of something as "deep" which is completely incomprehensible or bizarre. It is because what many of our philosophers have presented to us as deep and fundamental truths of existence have in fact been nothing more than incomprehensible or bizarre all along.
Rand was the first one in modern history to come out and say "The Emperor has no clothes...and this is why." She stated that some assumptions are necessary, that they are in fact assumed by anyone who would attempt to disprove them: Existence exists, Consciousness is conscious, A thing is itself (A is A). Her philosophical system anticipated significant developments in cognitive science (such as the embodiment of cognitive experience and the necessity for a hierarchy of concept formation for information processing) and linguistics (such as examining the concealment of agency realized by transitivity and passivization as a technique for encoding hidden ideology). Objectivism has ramifications for economics, political science, morality, law, and education. All of these fields are traditionally presented to us as decontextualized, incomprehensible forces of nature to which we must simply react, but can never hope to comprehend or to influence.
Objectivism makes explicit the underlying mechanisms of all of these processes and shows how we are the center of all of these systems, that we are not just passive receivers of some arbitrary destiny; that we have the power and indeed, the responsibility, to act upon those systems to make them better for our own sakes. And that by working to make these systems more productive objectively, that by striving to attain our own individual rational self-interest, by seeking to attain the best that life has to offer over the entire span of one's life, that the net result is an immeasurable benefit for everyone. But that the justification is not in the benefit to all but in the benefit to one's self. That we are born into this life as ourselves, that we experience only the life that we have as ourselves, and that the pursuit of happiness is not a pragmatic end, but a moral pursuit in and of itself.
Objectivism offers HAPPINESS, whereas the other varied philosophies and ideologies of our age only demand SACRIFICE. Sacrifice to what? For whose benefit? Will my children be the happier for me having sacrificed their economic well-being today? Will I truly have any greater guarantee of security by demanding that they pay for my retirement, when in fact the economic necessities of the system will mean that social security will most likely not even exist by that time? Will they be the better educated by demanding that they be constrained to the lowest common denominator of educational quality made possible by averaging the resources of the community as opposed to what I could provide for them unfettered by the economic burdens imposed by the government? No. No. No.
Opponents of Objectivism need to make an explicit stand, one that they cannot ultimately justify and thus why they always resort to ad hominem attacks or dodge the issue. Objectivism ultimately stands for the rational pursuit of your happiness over the span of your life. It holds that as a moral virtue, the highest moral goal. To say that Objectivism is evil, is to say that the pursuit of happiness is evil. To say that Objectivism is wrong, is to say that it is wrong to be happy, it is wrong to want the best for your children, it is wrong to receive greater pay for greater work, that any attempts to advance your position in life is evil and the most we can hope for in our imperfect lives is to beg for the mercy of those who hold incontrovertible power over us, whether they be thrust into that position by design or the vagaries of the political process.
I refute this view of life. I cannot accept that I was born to be the tool of others, that I was born to be used, manipulated, milked of whatever capacity I have and then to be cast aside with the fruits of my productivity to be dispensed according to the whims of a lunatic mob. I believe in the principles that America was founded upon. I believe in this nation of principles, the only nation ever founded by philosophers. What Ayn Rand represents is not a radical divergence from American values, she represents the soul of American virtue unabashedly claiming its rightful distinction as the only moral system which does not treat humanity as sacrifical animals to be slaughtered for the sake of anyone's whims, whether they be the dreams of one man, or the dreams of us all. This virtue can only be fully realized if we accept the objective basis of morality, the objective determinants of justice and just law.
And the final reason that I am an objectivist is not just because the logical arguments makes sense to me, but that I can see the principles that Objectivism makes clear in operation in every aspect of life around me. When I see the way people react to politics, or economics, or education. When I see the things that are easy to teach or are easy to learn. The more I discover about the processes of the human mind, and society. Everything that I learn from science and my experience with other human beings in society. Everything makes sense when viewed from an Objectivist perspective. Where before, there was only a chaos of competing voices all crying for power, all crying for pity, all teetering on an uncertain foundation rocking on the waves of public opinion, I have now come to see the levers which operate those systems, and to understand the motivations driving the forces in our society. When I see the accuracy with which the themes in Ayn Rand's works play out in the news around me and even in my own personal life, I cannot refute the predictive power of her model. No other philosophy I have studied has come anywhere near as close in terms of precise clarity and comprehensive explanatory power.
And that is why I am an Objectivist. If I were to find a proof, whether it be logical or practical which invalidated the propositions of Objectivism, I would surrender the title of Objectivist and set about constructing a revised philosophy incorporating that proof. But I haven't yet. Despite all the ranting on the internet. Despite all the spite and condemnations of Rand's work. Despite all the insults and some outright lies. Not a single detractor has been able to provide a significant counter-argument. So I ask openly: if you (anybody out there at all) have an objection, bring it forth. Let's talk about this here and now. If you can show me the error of my ways, then do so. But I only ask one thing in return. That if your arguments prove to be the weaker, will you be as willing to change your views? If you are, then you're probably closer to being an Objectivist than you may think.
Tuesday, March 3, 2009
Apples, No Apples, Apples: The Sleight of Hand of Obama Inc.'s Elite Economic Corps of Dunderheads
OK. Now I had to read this a couple of times to make sure I got it straight. Now, I thought that I wasn't reading it correctly. I mean, circular logic has some famous adherents. Just look at Descartes' Meditations on First Philosophy...or Sam Harris' justification for torture. But this circle is the most striking for how clearly circular it is. You don't have to dig too deep to see the sleight of hand going on in this one. For the whole article, you'll have to check out this link here.
But the part that floored me was this quote:
""I do think the American people in the past have shown an excellent ability to respond to adversity," Fed Chairman Ben S. Bernanke told members of the Senate Budget Committee. "And I believe it's going to happen this time and that we're going to see a much stronger economy, not that far in the future."
To hasten that day, the Fed and the Treasury launched their long-awaited program to jump-start the market for consumer loans, including financing for small businesses, students and car buyers.
Under the program, known by the acronym TALF, the Fed will provide loans to investors who buy securities backed by newly issued consumer loans. The idea is to revive the market for asset-backed securities, which provides funding for a large portion of consumer lending.
"In our system, banks are important, but typically 40% of lending comes through the securitization markets. And those markets are not functioning well," Treasury Secretary Timothy F. Geithner told the House Ways and Means Committee.
"So we're going around banks . . . by doing something only the government can do, which, on appropriate terms to protect the taxpayer, is to try to get those credit markets opening up again," he said." "
OK. TALF. This is the system as it appears to be presented here. The government will now encourage more lending to groups which are high risk in a recession and which the markets recognize as such: students, small businesses, and car buyers. (It may be for that reason that the banks aren't loaning as much to these groups right now..duh....)
But of course, Obama Inc. and his party of looting neanderthals, think that the answer is to give more money to people who probably won't be able to pay it back. (AIG, GM...etc, etc, etc...)
In this case, they will subsidize the extension of credit to high risk groups by sponsoring securities based on packages of volatile debt. They will use the security of the United States Treasury to guarantee that debt and sell shares in it to investors. Not only that, but it will loan money to investors so that they can buy those securities. So, technically, the government will be making it look like it's selling financial instruments when really it's just handing out taxpayer money again.
If the initial loans go into default, the securities become worthless. That means the government can't collect the money from these loans, which means that the investors also don't get anything from the securities either, except that they have to pay back the loans to the government that they used to buy the now worthless securities. Which means that the government will in effect be paying for it's handouts to high-risk lenders by convincing credit-worthy investors to commit to paying for them over the long-term.
Housing fiasco redux.
What Obama and his geniuses are assuming is that the people who will receive these loans will actually pay them back. Now here's the catch. If any financial institution was reasonably confident that the people who are the potential beneficiaries of these loans could actually pay them back, then the financial institutions would loan them the money in the first place.
Why? Because that's how financial institutions make money. By lending to people who pay them back plus interest. Nobody makes money by lending to people who don't pay back. As the housing fiasco and its consequences have effectively demonstrated.
So what will happen to investors who buy large amounts of these securities, if the securities go into default (as they probably will)? Well, their balance sheets will have a sudden gaping hole where their assets used to be, and an equal amount of now unsupported debt. In short, I think that any investor who takes a heavy interest in these derivatives will be staking a lot on the dependability of the federal government to lend responsibly. And if the federal government doesn't, then we will see even more investors taken down in this thing. That will further damage the economy, destroy even more wealth (or "redistribute it" as Obama likes to say), and almost certainly cripple our nation for decades. (That is, decades more than these kind of policies have already crippled us...)
Now, now, I'll be fair. The current crisis isn't Obama's doing. It was caused by Bernanke, Greenspan, and the hypocrites at the Fed and in Congress on both sides of the aisle who have been supporting centrist government-controlled markets. That was the problem with the Republicans. They talked free markets, but they were busy getting their hands deep into the guts of it, so they could grease their own pockets, and the pockets of their buddies. That and they were spending so much time preaching about God that the secular conservatives out there didn't feel very comfortable supporting them either.
The Democrats are idealogues. I seriously believe that they think that they are helping people by sacrificing us all to the hunger of the disenfranchised mob that has been created by generations of irresponsible governance. (Although I think it's telling, how many of Obama's picks have a problem paying their taxes...)
The answer is to stop this madness, not to keep trying more of the same thing.
Cut spending, cut taxes, cut social programs and privatize them.
Privatize education.
Dissolve the Fed.
Introduce a staged retreat from social security so that we can support those who have already paid their way in, but so that we can phase it out as soon as possible. Phase out medicare and government intervention in insurance premiums.
Stop the senseless bailouts of companies that shovel out lifetime-guaranteed retirement policies to workers who retire at 48?! (Like GM....)
Stop the war on poverty. The supposed enemy in that war is the only group that can even remotely provide what is needed to alleviate the problem, by pursuing that war we intensify the poverty.
Stop the war on drugs. 1 in 32 Americans are in jail. 25% of them are there for drugs. Only 5% of homicides were narcotics related. Educate your children to keep them off drugs. I agree, they suck. They are NOT good things to have around children. But neither is tobacco or alcohol, and we have managed to keep them in control without making them into the dangerously uncontrolled illicit multi-billion dollar global industries that illicit drugs are today. In a way, the war on drugs is paying for the war on terror....paying our enemy's wages. Not unlike Prohibition and the mafia...Remove the profit, make them legal and regulate them like any other drug or intoxicant.
And, no, we don't need the self-inflated pompous rhetoric of Rush Limbaugh to rally around. What we need is a return to fundamental principles, like those advocated by Ron Paul and Barry Goldwater and the generation of conservatives who really lived up to that name. The crisis we are experiencing day by day in our sweat, our fear, our blood, and our lives...this crisis is a moral crisis. The moral superiority of laissez-faire capitalism, the objective moral reality of rational self-interest as a life-generating force, the moral supremacy of reason as opposed to the bulwarks of religion or the frantic paranoia of the social relativist---the denial of these truths is what we are experiencing tangibly, and visibly and undeniably this very moment.
This country is headed in the wrong direction, and we're speeding it up! You can't defend freedom by destroying it. You can't defend liberty by enslaving yourselves. You can't increase prosperity by punishing it. You can't inspire innovation by stifling it in bureaucratic red tape. You can't broaden minds through education by stifling teacher creativity. You can't heal bad debt by creating more of it. You can't have your cake and eat it too.
"Yes, this is an age of moral crisis. Yes, you are bearing punishment for your evil. But it is not man who is now on trial and it is not human nature that will take the blame. It is your moral code that's through, this time. Your moral code has reached its climax, the blind alley at the end of its course. And if you wish to go on living, what you now need is not to return to morality -- you who have never known any -- but to discover it." --Ayn Rand (Atlas Shrugged)
But the part that floored me was this quote:
""I do think the American people in the past have shown an excellent ability to respond to adversity," Fed Chairman Ben S. Bernanke told members of the Senate Budget Committee. "And I believe it's going to happen this time and that we're going to see a much stronger economy, not that far in the future."
To hasten that day, the Fed and the Treasury launched their long-awaited program to jump-start the market for consumer loans, including financing for small businesses, students and car buyers.
Under the program, known by the acronym TALF, the Fed will provide loans to investors who buy securities backed by newly issued consumer loans. The idea is to revive the market for asset-backed securities, which provides funding for a large portion of consumer lending.
"In our system, banks are important, but typically 40% of lending comes through the securitization markets. And those markets are not functioning well," Treasury Secretary Timothy F. Geithner told the House Ways and Means Committee.
"So we're going around banks . . . by doing something only the government can do, which, on appropriate terms to protect the taxpayer, is to try to get those credit markets opening up again," he said." "
OK. TALF. This is the system as it appears to be presented here. The government will now encourage more lending to groups which are high risk in a recession and which the markets recognize as such: students, small businesses, and car buyers. (It may be for that reason that the banks aren't loaning as much to these groups right now..duh....)
But of course, Obama Inc. and his party of looting neanderthals, think that the answer is to give more money to people who probably won't be able to pay it back. (AIG, GM...etc, etc, etc...)
In this case, they will subsidize the extension of credit to high risk groups by sponsoring securities based on packages of volatile debt. They will use the security of the United States Treasury to guarantee that debt and sell shares in it to investors. Not only that, but it will loan money to investors so that they can buy those securities. So, technically, the government will be making it look like it's selling financial instruments when really it's just handing out taxpayer money again.
If the initial loans go into default, the securities become worthless. That means the government can't collect the money from these loans, which means that the investors also don't get anything from the securities either, except that they have to pay back the loans to the government that they used to buy the now worthless securities. Which means that the government will in effect be paying for it's handouts to high-risk lenders by convincing credit-worthy investors to commit to paying for them over the long-term.
Housing fiasco redux.
What Obama and his geniuses are assuming is that the people who will receive these loans will actually pay them back. Now here's the catch. If any financial institution was reasonably confident that the people who are the potential beneficiaries of these loans could actually pay them back, then the financial institutions would loan them the money in the first place.
Why? Because that's how financial institutions make money. By lending to people who pay them back plus interest. Nobody makes money by lending to people who don't pay back. As the housing fiasco and its consequences have effectively demonstrated.
So what will happen to investors who buy large amounts of these securities, if the securities go into default (as they probably will)? Well, their balance sheets will have a sudden gaping hole where their assets used to be, and an equal amount of now unsupported debt. In short, I think that any investor who takes a heavy interest in these derivatives will be staking a lot on the dependability of the federal government to lend responsibly. And if the federal government doesn't, then we will see even more investors taken down in this thing. That will further damage the economy, destroy even more wealth (or "redistribute it" as Obama likes to say), and almost certainly cripple our nation for decades. (That is, decades more than these kind of policies have already crippled us...)
Now, now, I'll be fair. The current crisis isn't Obama's doing. It was caused by Bernanke, Greenspan, and the hypocrites at the Fed and in Congress on both sides of the aisle who have been supporting centrist government-controlled markets. That was the problem with the Republicans. They talked free markets, but they were busy getting their hands deep into the guts of it, so they could grease their own pockets, and the pockets of their buddies. That and they were spending so much time preaching about God that the secular conservatives out there didn't feel very comfortable supporting them either.
The Democrats are idealogues. I seriously believe that they think that they are helping people by sacrificing us all to the hunger of the disenfranchised mob that has been created by generations of irresponsible governance. (Although I think it's telling, how many of Obama's picks have a problem paying their taxes...)
The answer is to stop this madness, not to keep trying more of the same thing.
Cut spending, cut taxes, cut social programs and privatize them.
Privatize education.
Dissolve the Fed.
Introduce a staged retreat from social security so that we can support those who have already paid their way in, but so that we can phase it out as soon as possible. Phase out medicare and government intervention in insurance premiums.
Stop the senseless bailouts of companies that shovel out lifetime-guaranteed retirement policies to workers who retire at 48?! (Like GM....)
Stop the war on poverty. The supposed enemy in that war is the only group that can even remotely provide what is needed to alleviate the problem, by pursuing that war we intensify the poverty.
Stop the war on drugs. 1 in 32 Americans are in jail. 25% of them are there for drugs. Only 5% of homicides were narcotics related. Educate your children to keep them off drugs. I agree, they suck. They are NOT good things to have around children. But neither is tobacco or alcohol, and we have managed to keep them in control without making them into the dangerously uncontrolled illicit multi-billion dollar global industries that illicit drugs are today. In a way, the war on drugs is paying for the war on terror....paying our enemy's wages. Not unlike Prohibition and the mafia...Remove the profit, make them legal and regulate them like any other drug or intoxicant.
And, no, we don't need the self-inflated pompous rhetoric of Rush Limbaugh to rally around. What we need is a return to fundamental principles, like those advocated by Ron Paul and Barry Goldwater and the generation of conservatives who really lived up to that name. The crisis we are experiencing day by day in our sweat, our fear, our blood, and our lives...this crisis is a moral crisis. The moral superiority of laissez-faire capitalism, the objective moral reality of rational self-interest as a life-generating force, the moral supremacy of reason as opposed to the bulwarks of religion or the frantic paranoia of the social relativist---the denial of these truths is what we are experiencing tangibly, and visibly and undeniably this very moment.
This country is headed in the wrong direction, and we're speeding it up! You can't defend freedom by destroying it. You can't defend liberty by enslaving yourselves. You can't increase prosperity by punishing it. You can't inspire innovation by stifling it in bureaucratic red tape. You can't broaden minds through education by stifling teacher creativity. You can't heal bad debt by creating more of it. You can't have your cake and eat it too.
"Yes, this is an age of moral crisis. Yes, you are bearing punishment for your evil. But it is not man who is now on trial and it is not human nature that will take the blame. It is your moral code that's through, this time. Your moral code has reached its climax, the blind alley at the end of its course. And if you wish to go on living, what you now need is not to return to morality -- you who have never known any -- but to discover it." --Ayn Rand (Atlas Shrugged)
Thursday, December 18, 2008
It's been a while... お久しぶり
First off, I'd like to apologize for being away for so long. But real life takes a priority over my internet musings. Anyways, having taken care of business for now, I find myself with some time to comment on the events of the last 4 months. Probably most prominent in everybody's minds is the full-blown financial panic that is sweeping over the world. The dollar is trading for 88 yen, the Dow is down, way down, and the big auto companies are on the verge of collapse. In the midst of this we have Greenspan lamenting the free-market system and Fortune 500 executives running down to Washington to beg for money--your money.
So, it goes without saying that a lot of people are wondering what Obama is going to do with this mess when he gets into office. A lot of people, that is, except for me. That's because I know exactly what he's going to do. He's going to spend a lot of government money. He's going to give a lot of money to big business, of course not the same big business cronies that Bush has, he'll give it to his green frontier democratic buddies. They may very well let the car companies hang (as they really should) but I don't think they'll go through with it. The Democrats are too reliant on unionized labor. Although the only way they're going to be able to pay for all these bailouts and all the social programs they want to cram down our throats is to raise taxes. Or perhaps they'll just raise taxes on businesses and the rich. (As if that won't be even more of a reason for companies and rich people to put their money elsewhere). Or, like Bernanke and the incompetent quacks at the FED have already done, devalue the currency like there's no tomorrow.
0% interest rates are not a good thing. Printing money on 0% interest rates to "increase cash flow" is not a good thing. It has one tangible result. Yes, money increases. But the downside is that money is worth less. Or worthless as the case may be. Japan is still stuck with interest rates next to nothing after 20 years of recession. It took Koizumi and his aggressive stance of let them fail and make them write off their bad debt, that cleansed the banking industry and let Japan recover, if only temporarily. For a brief span, the Japanese economy recovered. But it wasn't long before the looting bureaucrats, the ruling daimyo of the LDP decided to sink their teeth into the only freshly rejuvenated business sector. First off was a crack-down on foreign-sourced investments, increased government intervention in mergers and sales of businesses. A raise in taxes, the dismantling of Livedoor, and the ongoing stink of corruption in Japanese politics all combined to nudge things back over the edge. This was happening well-before the housing meltdown in the US, despite what the pundits say. I know. I've been watching the news, and I have a fairly decent long-term memory. Nonetheless, America wants to charge right after Japan and do exactly the same wrong things they did. Nobody, except perhaps Jim Rogers and perhaps the far too splintered assortment of objectivists and libertarians out there has a real understanding of what needs to be done...or perhaps nobody else who's speaking...
Dismantle the FED. Dismantle the government's centralized banking scheme. This disaster, and the long string of disasters that have been happening for the last hundred years are all the direct result of government intervention. Think about it this way, did they have such a thing as unemployment in early days after the American revolution, when business was relatively unrestricted? No.
Yes, there were poor people and there were rich people. There will always be poor people and rich people. But the difference is that the classical American system enabled people to become rich by their own effort, with the fruits of their will. And with this freedom came the condemnation to poverty for the lack of effort. This is the principle of social justice. That those who do not strive to improve their lives shall not be able to, and that those who do, will be. Whether they will achieve personal happiness or not, is something which no government can ever promise, no human being can ever promise another. But the freedom to pursue happiness, the freedom to strive for it, to grasp for it, to work for it, matched with the opportunity to seize it if it is in your grasp---this is the freedom which drives the mind and hearts of men and women to do great things and to pull themselves up from the sordid depravity of apathetic resignation to misery which so characterizes life in the collectivist nations throughout history.
But you, who would preach that social justice must be meted out by the government, those of you who preach that we should all be held hostage to one man's vision of the future, to one man's dreams, even if he is selected by all of our neighbors, you preach a different creed. For how many years must we pay off the future? For how many years must the children of today be sacrificed for the phantoms of tomorrow? Whose vision is worth the slavery of a single man? A single woman? A single child? The founders of this country said that freedom was the heart and soul of value, that without freedom, there is no value to be had in society. That without freedom, we are slaves. And so we are.
'How can we be slaves?' you may ask. After all, are we not surrounded by art and entertainment to suit any fantasy? Are we not free to elect whoever we want for office? (Although the efforts to keep third-party candidates from participating in elections may cast some doubt on that premise.) What else would you call it when all of us must work as hard as we can to gather what resources we can to survive, but people come with the threat of imprisonment or violence to take what you have worked to bring into creation by force? The presumption is that the fruits of your labor are not yours. The presumption is that they belong to your master and that it is your master's will which has the right to decide how they are dispersed. Whether that master is one man who seized power, or if that master is a group of men who your neighbors have chosen to lead you, even if that master was chosen by you yourself--that does not grant them the moral right to your labor. If you grant others the moral right to dictate the terms of your work and the use of its products, then you grant them the moral right to treat you as a slave. And so we are treated. Groups of men and women gather to decide how they can divvy up the pie of American wealth without any consideration that they did nothing to create it, and have no moral claim to it. They cite legal precedent as the foundation of their right, common law borrowed from Europe.
What they neglect to recognize is that America's break from Europe was an ideological break, a moral break. The morality of Europe had led to the servitude of its citizenry and generations of feudal wars, alliances, treachery, and corruption. The strengths of America were the strengths of an emergent American morality, one which died stillborn for want of a voice to express it in terms detached from the old traditions of altruism. And altrusim has slowly choked that system of strength until America will soon fade into the ranks of other statist, socialist nations, chomping at the bit for a taste of world power. What could have once been a shining model of the glory of human liberation, is slippy into the murky, soiled, and shabby frame of a beggar whining about destiny. A nation of men and women who forged their own destiny with their bare hands, is being whipped and shaped into a nation of equivicators and rationalizers. Let reality be the final judge and arbiter of this debate, of this age-long struggle. Open your eyes and see that the tragedies in the headlines today are the culmination of thousands of years of repeating the same mistakes over and over again. For how long can we repeat those very same mistakes without realizing that the answer is to try something different, something which has not been tried, something which would set us all free to pursue our dreams to the extent of our abilities and fly as high as we are able? Why not try freedom? Why not try capitalism? Real capitalism. Not the watered down, hypocritical vacillation characterized by base opportunists like Greenspan. Real capitalism, like that envisioned by Ayn Rand (whom Greenspan betrayed the moment he joined the FED). Instead, is it really better to emulate a socially stagnant Japan or the disastrous economic policies of Soviet Russia?
Who pays for it? Who pays for it all? We all do. We are all victims in this, and some are both victim and victimizer. But we will all pay the price. Our children will pay it and their children. By supposedly working for the future we are instead signing our children over into a life of slavery, where their dreams will always be ranked second to the demands of any organized group of their neighbors. What's the price? The price is paid for in deserted store fronts. The price is paid in unemployment. The price is paid in disease and crime. The price for your slave-owner's paradise, is that everyone is enslaved, noone and everyone is master, and we all descend into poverty together. Or is it that you imagine yourself in the 'privileged' elite that won't have to muck about with all that. Well, I suppose an altruist like Warren Buffett would probably be the last to feel the effects of the meltdown. But when need and apathy has strained their functional capacity and drained the motivation of it's creative minds--it won't be long before the institutional foundations of businesses around the world come tumbling down like a cascading array of dominoes.
If you are still not convinced, if instead you are more than ever insistent that the only way to cure our current ails is to whip us into better and better shape, to force us at the point of the gun and demand our cooperation through violence, then you deserve everything that's coming down the line. Why? Because it's your choice. The ideas you promote, the people you elect have a tangible effect on the world we live in. You can either choose to make it a better world, one where people are freer and happier. Or you can prolong the suffering, dispense misery and condone the execution of the human soul. You WILL reap that which you sow.
So, it goes without saying that a lot of people are wondering what Obama is going to do with this mess when he gets into office. A lot of people, that is, except for me. That's because I know exactly what he's going to do. He's going to spend a lot of government money. He's going to give a lot of money to big business, of course not the same big business cronies that Bush has, he'll give it to his green frontier democratic buddies. They may very well let the car companies hang (as they really should) but I don't think they'll go through with it. The Democrats are too reliant on unionized labor. Although the only way they're going to be able to pay for all these bailouts and all the social programs they want to cram down our throats is to raise taxes. Or perhaps they'll just raise taxes on businesses and the rich. (As if that won't be even more of a reason for companies and rich people to put their money elsewhere). Or, like Bernanke and the incompetent quacks at the FED have already done, devalue the currency like there's no tomorrow.
0% interest rates are not a good thing. Printing money on 0% interest rates to "increase cash flow" is not a good thing. It has one tangible result. Yes, money increases. But the downside is that money is worth less. Or worthless as the case may be. Japan is still stuck with interest rates next to nothing after 20 years of recession. It took Koizumi and his aggressive stance of let them fail and make them write off their bad debt, that cleansed the banking industry and let Japan recover, if only temporarily. For a brief span, the Japanese economy recovered. But it wasn't long before the looting bureaucrats, the ruling daimyo of the LDP decided to sink their teeth into the only freshly rejuvenated business sector. First off was a crack-down on foreign-sourced investments, increased government intervention in mergers and sales of businesses. A raise in taxes, the dismantling of Livedoor, and the ongoing stink of corruption in Japanese politics all combined to nudge things back over the edge. This was happening well-before the housing meltdown in the US, despite what the pundits say. I know. I've been watching the news, and I have a fairly decent long-term memory. Nonetheless, America wants to charge right after Japan and do exactly the same wrong things they did. Nobody, except perhaps Jim Rogers and perhaps the far too splintered assortment of objectivists and libertarians out there has a real understanding of what needs to be done...or perhaps nobody else who's speaking...
Dismantle the FED. Dismantle the government's centralized banking scheme. This disaster, and the long string of disasters that have been happening for the last hundred years are all the direct result of government intervention. Think about it this way, did they have such a thing as unemployment in early days after the American revolution, when business was relatively unrestricted? No.
Yes, there were poor people and there were rich people. There will always be poor people and rich people. But the difference is that the classical American system enabled people to become rich by their own effort, with the fruits of their will. And with this freedom came the condemnation to poverty for the lack of effort. This is the principle of social justice. That those who do not strive to improve their lives shall not be able to, and that those who do, will be. Whether they will achieve personal happiness or not, is something which no government can ever promise, no human being can ever promise another. But the freedom to pursue happiness, the freedom to strive for it, to grasp for it, to work for it, matched with the opportunity to seize it if it is in your grasp---this is the freedom which drives the mind and hearts of men and women to do great things and to pull themselves up from the sordid depravity of apathetic resignation to misery which so characterizes life in the collectivist nations throughout history.
But you, who would preach that social justice must be meted out by the government, those of you who preach that we should all be held hostage to one man's vision of the future, to one man's dreams, even if he is selected by all of our neighbors, you preach a different creed. For how many years must we pay off the future? For how many years must the children of today be sacrificed for the phantoms of tomorrow? Whose vision is worth the slavery of a single man? A single woman? A single child? The founders of this country said that freedom was the heart and soul of value, that without freedom, there is no value to be had in society. That without freedom, we are slaves. And so we are.
'How can we be slaves?' you may ask. After all, are we not surrounded by art and entertainment to suit any fantasy? Are we not free to elect whoever we want for office? (Although the efforts to keep third-party candidates from participating in elections may cast some doubt on that premise.) What else would you call it when all of us must work as hard as we can to gather what resources we can to survive, but people come with the threat of imprisonment or violence to take what you have worked to bring into creation by force? The presumption is that the fruits of your labor are not yours. The presumption is that they belong to your master and that it is your master's will which has the right to decide how they are dispersed. Whether that master is one man who seized power, or if that master is a group of men who your neighbors have chosen to lead you, even if that master was chosen by you yourself--that does not grant them the moral right to your labor. If you grant others the moral right to dictate the terms of your work and the use of its products, then you grant them the moral right to treat you as a slave. And so we are treated. Groups of men and women gather to decide how they can divvy up the pie of American wealth without any consideration that they did nothing to create it, and have no moral claim to it. They cite legal precedent as the foundation of their right, common law borrowed from Europe.
What they neglect to recognize is that America's break from Europe was an ideological break, a moral break. The morality of Europe had led to the servitude of its citizenry and generations of feudal wars, alliances, treachery, and corruption. The strengths of America were the strengths of an emergent American morality, one which died stillborn for want of a voice to express it in terms detached from the old traditions of altruism. And altrusim has slowly choked that system of strength until America will soon fade into the ranks of other statist, socialist nations, chomping at the bit for a taste of world power. What could have once been a shining model of the glory of human liberation, is slippy into the murky, soiled, and shabby frame of a beggar whining about destiny. A nation of men and women who forged their own destiny with their bare hands, is being whipped and shaped into a nation of equivicators and rationalizers. Let reality be the final judge and arbiter of this debate, of this age-long struggle. Open your eyes and see that the tragedies in the headlines today are the culmination of thousands of years of repeating the same mistakes over and over again. For how long can we repeat those very same mistakes without realizing that the answer is to try something different, something which has not been tried, something which would set us all free to pursue our dreams to the extent of our abilities and fly as high as we are able? Why not try freedom? Why not try capitalism? Real capitalism. Not the watered down, hypocritical vacillation characterized by base opportunists like Greenspan. Real capitalism, like that envisioned by Ayn Rand (whom Greenspan betrayed the moment he joined the FED). Instead, is it really better to emulate a socially stagnant Japan or the disastrous economic policies of Soviet Russia?
Who pays for it? Who pays for it all? We all do. We are all victims in this, and some are both victim and victimizer. But we will all pay the price. Our children will pay it and their children. By supposedly working for the future we are instead signing our children over into a life of slavery, where their dreams will always be ranked second to the demands of any organized group of their neighbors. What's the price? The price is paid for in deserted store fronts. The price is paid in unemployment. The price is paid in disease and crime. The price for your slave-owner's paradise, is that everyone is enslaved, noone and everyone is master, and we all descend into poverty together. Or is it that you imagine yourself in the 'privileged' elite that won't have to muck about with all that. Well, I suppose an altruist like Warren Buffett would probably be the last to feel the effects of the meltdown. But when need and apathy has strained their functional capacity and drained the motivation of it's creative minds--it won't be long before the institutional foundations of businesses around the world come tumbling down like a cascading array of dominoes.
If you are still not convinced, if instead you are more than ever insistent that the only way to cure our current ails is to whip us into better and better shape, to force us at the point of the gun and demand our cooperation through violence, then you deserve everything that's coming down the line. Why? Because it's your choice. The ideas you promote, the people you elect have a tangible effect on the world we live in. You can either choose to make it a better world, one where people are freer and happier. Or you can prolong the suffering, dispense misery and condone the execution of the human soul. You WILL reap that which you sow.
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