My fellow Americans;

Four years ago, on this day in 2008, Bear Stearns stood on the edge of collapse.  We did not know this, of course, as other than their two hedge funds’ failure their internal condition was hidden — by the company and by the regulators who were charged with keeping our financial system safe.

Over the next six months we came close to losing America.

Today, we’re not in much better shape.

We have failed to address the first, and only, reason we find ourselves mired in an economic situation where we cannot grow and we cannot prosper.  Where The Senate has failed to pass a budget for nearly three years.  Where The House has proved unable to put forward a set of spending and revenue bills that balance.

The reason for our economic malaise, for the near-collapse in our economy in 2008 and the inability to exit the job recession of the last four years is that those who you vote for are incapable of telling you the truth.

The truth of a nation’s financial situation is no different than that of your household.  You cannot spend more than you earn in your household for a long period of time.

We all have short-term challenges in life; a sudden illness, the loss of a job, a leaking roof.   The wise family socks away some percentage of their earnings — their personal economic surplus — to buffer itself from these ordinary and expected calamities.  The less-wise depends on the ability to pull out a credit card and charge that new refrigerator when the need arises.

It is a time-honored practice in America for politicians to make promises they cannot keep.  We promise to build a gleaming new school, brimming with high technology, but we did not put aside the tax money to construct it in advance.  We promise that you will have medical care in retirement, but we never funded that program.  We promise that you have a “lock box” in Social Security, but then we raid it to make the budget deficit look smaller.  And we all want to drive cars, but we don’t want oil rigs off our shores, we don’t want pipelines and refineries across our land, and we don’t have either the money or the moral right to invade all those nations in the world that have the energy resources we need.

Our medical system has increased in cost at a compounded 8% rate for the last 30 years.  In 1980 the Federal Government spent $53 billion on all medical programs combined.  Last year it spent over $800 billion.  Politicians on both sides of the aisle have taken the  “gold-standard” position that nobody over the age of 50 will see their Medicare tampered with, as they know that you, the voter, will fire them if they tell you the truth.

The truth is that Medicare cannot be fixed and neither can Medicaid, standing alone.  Instead we must repair the medical system itself.  EMTALA, which mandates that hospitals must treat everyone irrespective of the ability to pay, must be revisited and either modified or abolished.  The practices of cost-shifting, where what you pay for a medical procedure, drug or device is set based only on how you pay for it or where you live, all exempted from laws that make this conduct illegal in other lines of business, must end.  The provision of taxpayer-funded medical care to those who are in this nation illegally must be abolished.  These changes must take place now, not tomorrow and definitely not “somewhere down the road.”  If they do not our medical costs will double in another six years, and we do not have the money to pay that cost.  The result of inaction today, as a matter of mathematical certainty, will be rationing of medical care and collapse of these programs.

The same rot that has infested our medical system must be excised from the rest of our Federal Budget.  The simple fact of the matter is that we are borrowing more than one third of every dollar the federal government spends.  This will double the national debt in less than a decade — again.  We have added more than 50% to our federal debt in three years, and we cannot continue on this path.  Eventually, foreign and domestic creditors who have lent the government that money will go on strike, dramatically raising the cost of financing.  When this occurs we will be forced to cut the size of government by more than 50% in an afternoon, instantly collapsing all of our federal social programs.

There are people on the right side of the aisle who say that we have to “grow the economy” to get out of the current fiscal mess.  They’re lying.  This mantra has been repeated for 30 years, and yet not once has this actually produced economic growth that exceeds the growth in debt through the economy.  The economic bubble in Internet stocks in the 1990s and the housing bubble of the 2000s were both caused by outrageously-fraudulent acts — first through making of knowingly-false statements about exponential growth of the Internet that could not possibly be true for more than a couple of years, and then again through the making of “fog-a-mirror” loans that were packaged up and sold as “solid AAA credits” through the financial system.  Both bubbles were driven by knowing lies.

The tax system at the corporate and personal level favors debt instead of equity, leverage over thrift and industry.  This must end.  The Fair Tax is one such way to do so; by zeroing the corporate tax and rendering all taxes on consumption it removes the preference for debt over equity, makes lobbying for special preferences impossible and makes the cost of government instantly visible and transparent to everyone in the nation.  The Internal Revenue Code should be burned to ash and replaced with The Fair Tax tomorrow morning.

The right also says that we need to return to “sound money.”  But sound money means no more fiscal deficits — period — and no unbacked credit emission.  Yet none of the people on the right side of the aisle — or the left — are actually proposing to cut off that fraudulent emission of credit nor are they proposing a balanced budget.  Yet this is a necessary condition in order to have “sound money.”

The left says that the rich must pay their “fair share.”  But what is their “fair share”?  Nobody on their side of the aisle will tell you.  The fact is that the “rich” pay nearly all of the income taxes now and yet the federal government spends all of that money and then more than a third more — which it doesn’t have.  The lesson is simple — no matter how much money we shovel into Washington it will spend every penny and then continue to spend more, even though Congress doesn’t have it.  There can be no fiscal discipline nor a resolution to this problem until the Congress stops spending money that it has not been able to first tax from someone.

Government tax receipts are, in the main, entirely dependent on the employment participation rate.  That rate is back to where it was in the 1970s and has not budged despite the alleged “recovery” since early 2009.  The fact of the matter is that behind this problem is the offshoring of labor; we temporarily made possible the appearance of prosperity through excessive borrowing at all levels of the economy — federal, state, local and personal.

But those days have now come to an end and we must deal with what our fiscal and employment situation is on-balance, not what we would like it to be.

Either our wage and environmental laws are just or they are not.  If they are not then they must be repealed.  If they are then they must be enforced.  Since we cannot police every nation in the world on either a practical or moral basis the only means of policing those laws beyond our borders are through the imposition of tariffs on all goods and services sold in the United States. This is both a lawful and Constitutional means of enforcing our labor and environmental standards.  Companies can either construct their goods and provide their services with labor and materials from the United States, employing Americans, or they can cover the social spending necessitated by exploiting our markets with slave labor and environmental destruction abroad through tariffs imposed on their activity.  The choice is theirs, but this mandate must be ours, without fear or favor.

Companies such as Apple often claim that they cannot fill the jobs they need filled in America, and that our educational system is failing.  More than fifty years of federal involvement in the education of our children has proved to be an abject failure.  “No Child Left Behind” in fact has left all children behind.  In the 1800s and early 1900s we powered ahead with innovation unmatched anywhere in the world, culminating with putting men on the moon.  We did it all, building this nation literally from the ground up, without Title I.  The Education Department must be de-funded and abolished tomorrow morning and Title I must be stricken from the books along with the rest of federal involvement in education.  We have 50 state laboratories on purpose and our federalist system ensures that our population is free to both vote for the state educational system desired in an area and that the people can move to states that fulfill their own individual mandates in this regard.  At the same time federal involvement in post-secondary education is an abomination; we must both remove the non-dischargable status of student loan debt and in fact remove all federal subsidy and support of higher education.  30 years of interference has proved that all of the “benefit” accrues to university bloat rather than educational outcome with costs increasing at more than three times the rate of inflation.  In 1980 you could flip pizzas to put yourself through college; today that is impossible.  This is not due to market forces; rather, it is due to intentional government interference that must be withdrawn.

America was founded on the rule of law.  Yet while it is illegal for you or I to defraud someone and we will be arrested, tried and imprisoned if we do, over a half-million citizens in Jefferson County Alabama were ripped off and had their water and sewer bills quadrupled through a series of fraudulent schemes.  Several county officials and others involved in the scams were tried and imprisoned.  But the banksters and companies who ultimately funded those bribes, and who benefited financially from these schemes and scams, were neither indicted or forced to give back their ill-gotten gains, and the bills have remained at the quadrupled level, effectively stealing from the citizens each and every month.  Other big firms who have made illicit profits through money laundering for Mexican drug gangs or the off-label promotion of prescription drugs have been fined some portion of their “excess profit”, which simply turns the breaking of the law into a business risk.  Again, if our laws are just then they must be enforced evenly against every entity, irrespective of their size or alleged “importance” to the nation.  The CEO and other corporate officers and board members must be held to account through personal liability when they either are aware of such violations of the law or willfully avert their eyes.  Sarbanes-Oxley allegedly addressed this failing in the white-collar world yet not one financial executive has been charged under this law.

America has the ability to be a great capitalist nation.  But today America is not a bastion of capitalism.  Many have claimed that we now have “crony capitalism” but that too is a misnomer.  Capitalism is the premise that one succeeds or fails through the wisdom of one’s investment, predicated on capital formation (that is, the investment of economic surplus into various economic activities.)  While the vestiges of this system remain in America, what has replaced it is a feudalistic system of scams, frauds, allegedly “lent” funds that do not in fact exist and bribery of various forms, both legal and not.

Later this year America will go to the polls to select a President and all 435 members of The House, along with one third of The Senate.  A vote for those candidates who are currently in office is a vote to continue the policies of theft, fraud and scam.  Neither major political party has shown any interest in reform or putting a stop to the scams, nor has either been willing to tell the truth.  It is often said that nobody other than a Democrat or Republican can win a major political office, yet this is simply untrue.  I have never in my life voted in an election in which only two names were on the ballot for President, and any of those on the ballot is capable of winning.

That which we vote for and demand we cannot complain about.  That which we refuse to admit to yet which is nonetheless true remains our responsibility.  With the cliff of fiscal insolvency and a forced and disorderly contraction in the size of the Federal Government by more than half now in view before us, we have the choice to either change course or drive straight toward certain government and economic ruin.

The responsibility for our political and economic future is in fact individually ours.  We can either focus on the political minutia such as abortion and gay marriage, or we can demand and vote only for candidates that will stop the deficit spending, put a final and complete end to the offshoring of our labor through the exploitation of the environment and slavery in foreign nations, and imprison the fraudsters in our financial system without regard to who they are, restoring the rule of law.

The choice is yours America, and so are the consequences.

Well look at the dichotomy we have here…. both from Bloomberg this morning.

First, on tax policy:

Republican presidential candidate Herman Cain’s plan to create a national sales tax would hurt retailers, threaten economic growth and shift the tax burden onto the middle class and poor, tax experts and business groups said.

Would it?  I’m not sold.  All that matters to the average person is purchasing power.

That is, the number of dollars you have is not particularly material.  What they will buy is what’s important.  And here’s the rub: You pay 15% of your income right now – everyone does that has “wage” income, whether self-employed or working for someone else.

Yes, half of that is “hidden” from you in the form of the payroll tax, but make no mistake, it’s your money being taken.  Your employer calculates the cost of that tax into your hiring decision, just as he does with all the other levies he pays, such as unemployment tax (FUTA and SUTA) and similar.  He may be prohibited by law from itemizing this on your pay stub (he is – I attempted to do it and was told by our accountants that I’d get a date with Bubba for doing so) but that doesn’t mean you don’t pay – you do, and it’s hidden through accounting fictions enforced at federal gunpoint.

So let’s presume you pay the “9 + 9″ – 9% of your gross income (no deductions) and 9% sales tax on what you choose to buy.

If you spend everything you make, what’s your effective federal tax?

That’s easy to calculate.  You start with $100.

You pay 9% in federal income tax, withheld at the point of payment.  You now have $91.

You go to the store.  You spend the entire $91.  How much goods do you buy?

$83.48 worth ($83.48 * 1.09 = $90.99 on the register tape.)

So your actual effective tax rate is approximately 16.5%, or 1.5% more than you pay right now in FICA and Medicare alone!

This assumes you spend every penny you make.

But let’s assume you save 10% of your gross.  That is, instead of spending $83.48 you spend $73.48.  Now the total bill at the register is $80.09, representing $6.61 in tax added to the $9 you have withheld.  Your effective tax rate is now 15.6%, or a full percentage point lower.

If you manage to save 15% of your gross you pay almost exactly the same tax rate you pay now for Medicare and Social Security alone!  In other words if you spend every nickel you pay an effective income tax rate of 1.5% and if you save 15% of your pre-tax income your effective income tax rate is zero.

So who gets “screwed” with this plan?  Well, nobody.  It forces everyone to have “skin in the game.”  Refundable tax credits disappear which means that everyone pays social insurance taxes.  This is how it should be!

What Cain is missing (and perhaps intentionally; if so he’s a jackass, not a savior) is that saving 15% of your income is more than sufficient, along with a modest help from Social Security and Medicare, to self-fund your entire retirement from savings alone.  That is, it requires no risk-taking in the “capital markets.”  There’s only one condition on this: The Federal Government and The Fed must be forced to stop debasing the currency — that is, they must run a zero inflation policy under penalty of imprisonment (or worse.)  If Cain supports this, then he’s a reformer.  If he does not, he’s simply playing politics and intends to screw you blind via hidden taxation.

There are others who bleat about the impact on financial services.  If I’m understanding Cain’s proposal correctly, they’re wrong: You would pay sales tax on the service of brokering a trade.  If you pay $8 a trade at a brokerage the tax would be 9% on the $8, not on the value of the securities.

The 9% income tax on corporations would redress the double-taxation of dividends, again, if I’m understanding the proposal correctly.  This would go a long way toward fixing the abortion that is found in the current tax code that provides incentives for corporate borrowing and makes the payment of income to shareholders prohibitively expensive through double-taxation of capital return.  That, more than anything else in the corporate tax code, is responsible for the abuse of leverage in business.  Cain has this part of the plan exactly right.

I also want to look at another part of his pronouncements:

Herman Cain’s self-described “bold” 9-9-9 tax proposal has received most of the attention in his campaign for the Republican presidential nomination. His plans for the federal budget are more radical.

Cain this week pledged at a debate to balance the government’s books in a single year if elected. This would require the elimination of what the Congressional Budget Office projects may be a more than $800 billion deficit in 2013.

Erasing the deficit that quickly would mean a more than 20 percent cut in spending, which could force reductions in politically sensitive programs such as Social Security, Medicare or defense, since they make up more than half the budget.

Actually, it’s more than that.  $800 billion is a fanciful number; we ran $1.7 trillion in deficits in calendar 2010, and are going to be well over $1 trillion in 2011.  To believe we will get under that number by 2013 presumes forward economic conditions that are, on balance, pure fantasies.

The complaint that this would require “massive” budget cuts is in fact accurate.  The bad news is that due to the nature of compound growth in any economic system the longer we wait the worse the problem gets and the more pain we must endure to correct it.

In other words while Cain’s proposal is “radical” it is only as radical as it is because we intentionally ignored this idiocy for 30 years, and in the last three years we went from a ~20% cut in federal spending that was required (from nearly zero a decade before!) to a 43% one.  Before another decade passes we will reach the point that achieving balance will require a default, not a cut in government programs.  At that point we are literally Greece.

Republicans in Congress have had to settle for promising to put the government “on the path” toward balance and calling for a constitutional amendment that would require the government to balance its books. While the amendment has little chance of being approved, it does allow lawmakers to underscore their desire to cut spending.

No they don’t.  And it doesn’t matter whether the people are “ready” to hear this or not.

Mathematics does not care if you’re politically correct or “politically willing” to hear what it proscribes.  It just is.

Cain’s plans are not “radical”, they’re mathematically sound.  I understand the screaming that is coming from the left and right on the issue, but the fact that politicians are trying to find yet another Unicorn that craps out pretty colored candies will not make it so.  These same politicians produced this:

And now wish to argue that the consequences of having done so should not be theirs.

I’m very sorry folks but there is no avoiding the inevitable, and the longer you put off accepting it the worse the outcome will be.

The government this week reported the U.S. poverty rate has risen to 15.1%, the highest since 1993, while 22% of children are living below the poverty line. Meanwhile, average median U.S. income fell 2.3% to $49,445, roughly 7% below the 1999 peak and a level not seen since 1996 on an inflation-adjusted basis. (See: As America’s Middle Class Shrinks, P&G Adopts “Hourglass” Strategy)

If you think that’s bad, just listen to what trend watcher Gerald Celente has to say in the accompanying video.

“Things are going to get much worse,” Celente says. “Society is breaking down on every level: socially, economically, politically and it’s not just the U.S. It’s worldwide.”

Celente believes the globe is following a similar path to what occurred after the 1929 crash: Severe economic contraction, followed by currency wars, trade wars and, ultimately, armed conflict.

Currency wars have already started he said, citing the recent decision by the Swiss National Bank to peg the Swiss franc to the euro. “Trade wars are next and then real wars, unfortunately,” Celente predicts.

Unlike the 1930s and 1940s, The Trends Journal publisher believes major nations will avoid direct conflict “because they can annihilate each other.”

The bad news is he expects more asymmetrical warfare, including the use of weapons of mass destruction such as bio-terrorism and “suitcase nukes.”

Power to the People

Lest you believe Celente, who has been making similar forecasts for some time, is entirely negative, he does believe there’s a solution: Direct democracy.

“If we can bank online we can vote online,” he quips, suggesting we follow the Swiss (or Californian) model of letting citizens vote on “major” decisions, such as war, health-care policy, education and the like.

“We don’t have a representative form of government,” Celente continues. “This is not a democracy. The only people these cats represent are the people that give ‘em a lot of dough.”

As discussed in a prior segment, Celente considers himself a political agnostic and doesn’t see much (or any) difference between the two major parties.

“It’s a two-headed, one party system,” he says. “We have a bunch of losers in Washington. How can any adult believe these guys after the summer spectacle of debt ceiling baloney?”

How, indeed.

The Daily Ticker

The guilty are powerful and free, the innocent burdened and oppressed: that is injustice.

There is a fundamental injustice that is poisoning the soul of the nation, and if it is not openly addressed then the nation will face the explosive consequences of institutionalized injustice.

Simply put, it is this: those responsible for the nation’s financial crisis and its catastrophic after-effects are not paying for the consequences of their actions–it is the innocent, those who were not responsible, who are paying the price.

You can call it whatever you want: the Anarchy of the Super-Rich (as per Paul Farrell), the Financial Power Elite, the financial Oligarchy, Plutocracy or Corporatocracy, or the unprecedented concentration of financial wealth and political power in a financialized post-industrial economy. Whatever you call it, we all know this class of financiers and its minions got away with high financial crimes.

Do the crime, do the time–unless it’s “white-collar” financial crime on a vast scale. Then you might pay a wrist-slap fine (a few million dollars from your treasure of embezzled hundreds of millions) and then you’re free to go on your merry way.

The after-effects are not just the losses which can be totalled on a calculator: the really catastrophic losses are to the foundations of democracy and the economy. Democracy has been subverted–oh please, spare us the happy-story propaganda about “reform” and “the system worked”–and the economy has been incentivized to favor poisonously addictive financialization and the shadow institutions of corruption, fraud, embezzlement, favoritism, collusion and misrepresentation of risk. This might be summarized as the protection of vested interests, engineered and overseen by the partnership of the ever more intrusive Central State and the nation’s Financial Power Elite.

The Central State, designed to protect the citizenry from an oppressive monarchy or Elite, now protects this Elite from the citizenry. That is how thoroughly the injustice has been institutionalized.

There is a second part to this fundamental injustice: look who will pay for the bailouts, guarantees and the interest on the borrowed trillions. Not the banks and bankers, to be sure. Who will pay? Those who the Central State can easily tap: taxpayers who earn most of their income from wages, and those politically weak players dependent on government payments.

Now that the bills of the bailout are coming due, the State isn’t going after GE for more taxes. Heavens no–if you try that, the Panzer Division of GE’s tax avoidance army would overrun you. No, the politically easy thing to do is raise taxes on wage earners and trim entitlements, because all the government needs to do is send down the orders and it is done: the taxes are withheld and the bennies trimmed.

To go after the Power Elite is just too difficult. They have the tax attorneys, the lobbyists, the campaign fundraisers, and all the rest.

The U.S. is just a third world kleptocracy on an Imperial scale. I explored the parallels with the Roman Empire in Survival+: the Elites increasingly avoided military service and taxation, the bedrock of Roman power, while the taxes on the middle class rose to such heights that this productive class was basically driven into serfdom. The bottom layer of State dependents was placated and made complicit with bread and circuses–yes, Rome had a vast “welfare state” and much of Rome’s population received free bread to keep them quiet and pliant.

That is of course a road to ruin: let the Elite plunder at will, protected by the Imperial Central State, tax the productive class to fund the armed forces and free bread, and then buy off the lower class with bread and circuses.

The only successful model of reconciliation and justice we have is the “truth commissions” in other post-oppression autocratic kleptocracies. In countries that were deeply divided and poisoned by institutionalized injustice and exploitation, the healing process requires a public, transparent “truth commission” in which the guilty are brought forth to confess their sins against the innocent and face the consequences of their actions.

If a society cannot rouse itself to cleanse the fundamental injustice at the heart of its institutions, then it is effectively choosing self-destruction.

So far, the U.S. is pursuing the Roman Imperial model with an institutional zeal unmatched since Rome’s fall.

Embedded institutional injustice has a price, a price which rises with every passing day of propaganda and prevarication. Some day the bill will come due and a terrible price paid in full. For those in power, the only concern is that it not be today or tomorrow.

Of Two Minds

At times it really is breathtaking how corrupted the U.S. government has become.  Government corruption has become so endemic in our society that most people have just kind of accepted it as “normal”.  But shouldn’t we all get hopping mad when we learn that the Federal Reserve sent billions of dollars in bailout money to addresses in the Cayman Islands?  Shouldn’t we all be furious when one of the leading candidates for the 2012 Republican presidential nomination, Mitt Romney, declares that he is “not going to spend my time focusing on the Federal Reserve”?  Shouldn’t we all be alarmed when Nancy Pelosi gives a speech in which she says that “elections shouldn’t matter”?  Shouldn’t we all demand that someone be held accountable when we find out that a CBO analysis shows that the “$38.5 billion” in spending cuts will only reduce the budget deficit for this year by $352 million dollars?  On top of everything else, shouldn’t we all be absolutely horrified when the TSA gropes little 6 year old girls and virtually none of our politicians demand change?

$38.5 Billion In Budget Cuts Is Really Just $352 Million In Deficit Reduction?

Yesterday I wrote about how a close examination of the “budget cut deal” reveals that the 38.5 billion dollars in budget cuts are largely illusory.

However, even I was not ready for what the Congressional Budget Office had to say about this deal.  What I read in the Washington Post today absolutely floored me.  According to the Washington Post,  the Congressional Budget Office is saying that the budget deal will only cut the budget deficit for this year by less than one percent of what was being claimed by Republican and Democrat leaders….

The Congressional Budget Office estimate shows that compared with current spending rates the spending bill due for a House vote Thursday would pare just $352 million from the deficit through Sept. 30. About $8 billion in cuts to domestic programs and foreign aid are offset by nearly equal increases in defense spending.

What a joke.

The reality is that U.S. government is increasing by over 2 million dollars every single minute.  So the entire “savings” from this “budget deal” will account for approximately 3 hours of government spending.

Look, the U.S. government ran a budget deficit of $188 billion dollars for the month of March alone.  We are in debt up to our eyeballs and it is getting worse at a mind blowing pace.

When are people going to wake up and realize that neither political party is the least bit serious about dealing with our debt problem any time soon?

The Federal Reserve Sent Billions In Bailout Aid To Millionaires and Billionaires In The Cayman Islands

Most Americans don’t even understand what the Federal Reserve is, and yet they get to throw trillions of dollars around while being more or less completely unaccountable the entire time.

In a new article for Rolling Stone (which is a must read), Matt Taibbi exposes some of the folks that the Federal Reserve has been sending money to….

The Fed sent billions in bailout aid to banks in places like Mexico, Bahrain and Bavaria, billions more to a spate of Japanese car companies, more than $2 trillion in loans each to Citigroup and Morgan Stanley, and billions more to a string of lesser millionaires and billionaires with Cayman Islands addresses. “Our jaws are literally dropping as we’re reading this,” says Warren Gunnels, an aide to Sen. Bernie Sanders of Vermont. “Every one of these transactions is outrageous.”

How in the world does it benefit the American people to send billions of dollars to some ultra-wealthy people down in the Cayman Islands?

In light of what we have already found out, it is absolutely amazing that Congress is still refusing to authorize a complete audit of the Federal Reserve.

The corruption of the Fed is crying out to be investigated.

Unfortunately, many of our top politicians are openly declaring that they have no intention of going after the Federal Reserve.

Mitt Romney Declares That He Will Not Be Going After Ben Bernanke Or The Federal Reserve

In case anyone needs one more sign that Mitt Romney is just another shill for the establishment, just check out the two statements by Romney below.

According to Politico, Romney recently told CNBC’s Larry Kudlow that he is not concerned about the Federal Reserve at all….

“I think Ben Bernanke is a student of monetary policy; he’s doing as good a job as he thinks he can do,” Romney said when Kudlow asked what kind of job Bernanke is doing. “I’m not going to spend my time going after Ben Bernanke. I’m not going to spend my time focusing on the Federal Reserve.”

That’s just great.  The Republican candidate with perhaps the greatest amount of “establishment support” says that he thinks that Bernanke is doing a good job and he does not plan to spend any time focusing on the Federal Reserve.

So if Romney gets in the Federal Reserve will continue to be able to dish out trillions to their friends without any interference.

Nancy Pelosi Declares That “Elections Shouldn’t Matter”

How are we supposed to respond when the top Democrat in the House of Representatives declares that “elections shouldn’t matter as much as they do”?

During a recent speech, Pelosi implored establishment Republicans to “take back your party” so that elections won’t “matter” as much….

To my Republican friends: take back your party. So that it doesn’t matter so much who wins the election, because we have shared values about the education of our children, the growth of our economy, how we defend our country, our security and civil liberties, how we respect our seniors. Because there are so many things at risk right now — perhaps in another question I’ll go into them, if you want. But the fact is that elections shouldn’t matter as much as they do… But when it comes to a place where there doesn’t seem to be shared values then that can be problematic for the country, as I think you can see right now.

Apparently what Pelosi wants is for America to go back to a time when all of us just went along with the false left/right paradigm and when we were all content to sleep while the establishment agenda rolled right along.

Well guess what Nancy?  Some of us are starting to wake up.

6 Year Old Girl Molested By The TSA

How far have we fallen as a nation when a 6 year old girl has to have her private areas touched in public by the TSA before she is allowed to get on an airplane?

America is becoming a very strange place.

The following is video that was posted on YouTube of the recent incident involving a 6 year old girl….

http://www.youtube.com/watch?v=SWExPhyPeZw

So is this what we have become as a nation?

Will we subject ourselves to anything as long as the authorities insist that it will keep us a little bit safer?

Pretty soon America is going to be unrecognizable.

I have previously written about how in one town in Missouri, girls scouts have actually been banned from selling girl scout cookies in their own front yards.

How crazy is that?

In Cleveland, authorities haves announced plans to have “trash supervisors” go snooping through trash cans to ensure that people are actually recycling according to city guidelines.

The control freaks we keep voting into office seem to have an obsession with running ever detail of our lives.

In many areas of the nation we aren’t even allowed to do acts of kindness anymore.

For example, in Houston, Texas a couple named Bobby and Amanda Herring that had been feeding homeless people for over a year has been banned by the city from doing so.

So what is next?

Are they going to ban kids from taking lunches to school?

It is already happening….

At one public school in the Chicago area, children have been banned from bringing their lunches from home.  Instead, it is mandatory that they eat the food that the cafeteria serves.

Meanwhile, the Federal Reserve gets to create trillions of dollars out of thin air and they get to send it to whoever they want.

What a country we have, eh?

Our system has become corrupted beyond all recognition.  Government corruption is out of control and it is getting worse with each passing day.

So when are the American people going to get sick of all this nonsense?

When are….

Wait.

American Idol is on tonight.

Perhaps all of this can just wait for another time.

After all, who wants to miss what J-Lo and Steven Tyler are going to say tonight?

Those two are really a couple of characters!

Our leaders know what they are doing, right?

We can trust our politicians to act in our best interest, right?

So instead of writing about all of this “doom and gloom”, perhaps I should just lighten up and focus on fun things like American Idol a little bit more.

The Economic Collapse

While we have a temporary ‘budget deal’ the debate is not over.  We still have to deal with the much bigger issues of the budget ceiling and the massive budget deficit.

If the U.S. government were to shut down for a while, would that really be such a bad thing?  Right now everyone in the mainstream media is freaking out as if the world is going to end, but the truth is that there have been government shutdowns before.  The apocalypse is not going to happen if there is another shutdown.  If Congress could find a way to get our troops and our border patrol agents paid, then what would be so bad about the government taking a “vacation” for a while?  After all, when was the last time that either the Republicans or the Democrats did anything that was actually good for America?  It has not mattered which political party has been in power – over the past couple of decades our “representatives” in Washington D.C. have passed an endless parade of bad laws and have gotten us into the biggest mountain of debt in the history of the world.  They literally seem unable to do anything right.  So would it really be so bad if a government shutdown slows them down for a while?  If our politicians are going to act like a bunch of idiots, why not let them shut it down?

Think of it this way – if you could eliminate all of the laws passed under George W. Bush and Barack Obama would you do it?

I think that most Americans would.

Almost every single law that has been passed over the past couple of decades has been bad for America.

But many Americans seem to be going into a panic at the thought that the “almighty government” might not be operating for a few days.

Many Americans seem to have bought into the lie that the federal government is the most important institution in our country.

But this is never what our founding fathers intended.  Our founding fathers intended for the federal government to be very limited.  Unfortunately, we have turned our backs on the principles of our founding fathers.

So exactly what is this fight between the Republicans and the Democrats all about?  Why have we been brought to the brink of a government shutdown?

We keep hearing that it is all about cutting the budget.  In fact, House Speaker John Boehner says that his party is “damn serious about it”.

But that is a joke.  The federal budget deficit for this year is going to be approximately $1.6 trillion dollars.  The Republicans were asking for just $61 billion in budget cuts (3.8% of the budget deficit) and there are rumors that Republican and Democratic negotiators have agreed to a figure of $38 billion in budget cuts.

$38 billion?

Is this why the Tea Party was sent to Washington?

$38 billion would just be 2.4 percent of the $1.6 trillion dollar deficit.

Wow, that is really wielding the budget cutting axe!

Look, the U.S. government cannot spend a single penny from now on without Republicans going along with it.

The Republicans control the House of Representatives.  Barack Obama and the Senate will not have a single dime to spend unless they can get the House to go along with it.

If the Democrats want money to implement Obamacare then they have to get the Republicans to go along with it.

If the Democrats want to give money to the EPA to implement Obama’s “green agenda” then they have to get the Republicans to go along with it.

In fact, pretty much whatever the Democrats want to do, they have to get the Republicans to agree to fund it.

So if you don’t like what Obama and the Democrats are doing, don’t just blame them.

Blame the Republicans as well.

Both parties are deeply corrupt and both parties have gotten us to the point we are at.

Sadly, it looks like any deal that the Republicans and the Democrats are going to agree to is going to include virtually everything that the Democrats want.

It is going to include full funding for Obamacare.

It is going to include full funding for Planned Parenthood.

It is going to include full funding for NPR.

It is going to include full funding for the EPA.

So what are the Republicans going to get?

$38 billion in spending cuts?

Is that supposed to be a “deal”?

The truth is that Boehner is a joke and he is not serious about cutting the federal budget.

But if we don’t start seriously cutting the federal budget we are heading for complete and total disaster.

David Stockman, who served as budget director under Ronald Reagan, says that if Congress is not serious about getting our financial house in order that a government shutdown could be precisely the kind of wake up call that we need….

If the Smithsonian, the Parks Service and the Cherry Blossom Festival get delayed or canceled, it’s the wakeup call that we really needed. The fools inside the Beltway are borrowing $100 billion month in and month out, and there’s nobody left in the world buying except the central banks—the Fed and the people’s printing press of China. There’s no way that’s sustainable or viable. It’s simply building up pressure in the monetary system that’s going to blow sky-high.

Look, the United States is heading straight for financial armageddon.  This is a crisis of historic proportions.  In a previous article on U.S. government finances, I detailed some absolutely horrifying statistics about the debt crisis that the U.S. government is facing….

*If you divide the national debt up equally among all U.S. households, each one owes a staggering $125,475.18.

*The federal government has borrowed 29,660 more dollars per household since Barack Obama signed the economic stimulus law two years ago.

*During Barack Obama’s first two years in office, the U.S. government added more to the U.S. national debt than the first 100 U.S. Congresses combined.

*In the new budget that the Obama administration has proposed, the U.S. government would spend 3.7 trillion dollars in 2012 and by 2021 the U.S. government would be spending a whopping 5.6 trillion dollars per year.

*The U.S. government currently has to borrow approximately 41 cents of every single dollar that it spends.

*The total compensation that the federal government workforce earned last year came to a grand total of approximately 447 billion dollars.

*The U.S. national debt is currently rising by well over 4 billion dollars every single day.

*The U.S. government is borrowing over 2 million more dollars every single minute.

*The U.S. national debt is over 14 times larger than it was just 30 years ago.

*Unfunded liabilities for entitlement programs such as Social Security and Medicare are estimated to be well over $100 trillion, and nobody in the U.S. government seems to have any idea how we are actually even going to come close to meeting all of those obligations.

*If you were alive when Jesus was born and you spent one million dollars every single day since that point, you still would not have spent one trillion dollars by now.  But this year alone the U.S. government is going to go about 1.6 trillion dollars more into debt.

*If the federal government began right at this moment to repay the U.S. national debt at a rate of one dollar per second, it would take over 440,000 years to pay off the national debt.

But even if the Republicans got every single thing that they have been demanding it would make essentially no difference as far as our national debt crisis is concerned.  It would basically be like spitting into Niagara Falls.

So which political party has the correct position in this battle?

Neither of them.  In fact, both political parties are a joke.  They are both acting like a bunch of idiots just like they have been for decades.

So let them shut it down.  The truth is that the number one threat to our liberties and freedoms right now is our own federal government.

In a recent article, J.B. Williams talked about why he thinks that it would be a really good idea to shut the government down….

I say, shut it down! The federal government has done as much to harm the union of states as it has ever done to improve freedom and liberty in America. We will be better off without a federal government, with each state able to fund and govern itself better than the Fed ever could.

Extreme threats demand extreme measures, and nothing threatens the future freedom and prosperity of the United States more than our own federal government. Enemies beyond, we can deal with. It’s the enemy within which threatens us most today. It’s time to shut it down and reset.

Just think about a few of the ways that our own federal government violates our liberties and freedoms every single day….

*If you want to get on an airplane in America today, you must either go through one of the incredibly intrusive full body scanners that are going into all U.S. airports and let airport security goons gawk at your exposed body, or you must allow airport security goons to feel you up using the new “enhanced pat down” techniques they are being instructed to employ.

*Thanks to the Patriot Act, if you are identified as a “terrorist”, you suddenly lose all of your constitutional rights.  We are told that detaining American citizens indefinitely and subjecting them to “enhanced interrogation” techniques will keep us all safer.

*The federal government controls our lives so tightly that now they even tell us what kinds of light bulbs we are allowed to buy.

*Barack Obama has been pushing a plan that would create a national database that will store the DNA of all individuals who have been arrested, even if they end up not being convicted of a crime.

*Just about anything can be used against you in court these days.  In one of the very first military commissions held under the Obama administration, a U.S. military judge ruled that confessions obtained by threatening the subject with rape are admissible in court.

*The federal government listens to our cell phones whenever they want and they require that all cell phone companies must be able to pinpoint the locations of all of their customers to within 100 meters.

*According to FBI Director Robert Mueller, ”homegrown terrorists” represent just as much of a threat to American national security as al-Qaeda does.

*In Washington D.C., if you do not submit to “random bag checks” while riding the Metro there is a good chance that you could receive a follow-up visit by the FBI or by the Department of Homeland Security.

*If you make food “incorrectly” there is a good chance that you will get raided by the federal government.  In fact, the feds raided an Amish farmer at 5 AM in the morning because they claimed that he was was engaged in the interstate sale of raw milk in violation of federal law.

So in light of how extreme our federal government has become, is there anyone out there that still thinks it would be a “crisis” if the government was to shut down for a while?

If our government is going to take away our liberties and freedoms instead of protecting them, then why would it be a bad thing if it shut down for a short time?

It might just get some of the control freaks off our backs for a while.

Yes, we do need to make sure our military men and women are paid.  We also need to make sure that our border patrol agents are paid.  But if Congress could actually get that accomplished it wouldn’t be too bad at all if the government were to shut down for an extended period of time.

The Economic Collapse

“It’s the DEBT, Stupid!”
We’re Doing Something About it! Come Join the Swarm!

Most Americans don’t really care about the economic minutiae that many of us who study the U.S. economy love to pour over.  When it comes to the economy, the typical American citizen just wants to be able to get a good job, make a decent living and put bread on the table for the family.  For generations, this arrangement has worked out quite well.  The U.S. economy has provided large numbers of middle class jobs and the American people have worked hard and have helped this nation prosper like no other.  But now people are starting to notice that something has shifted.  Millions of people are looking around and are realizing that the jobs that are supposed to be there are not there anymore.  The American people are still working hard (and in many cases harder than ever) but all of that hard work is producing fewer and fewer rewards.  Often politicians will placate voters by telling them that they are working harder and harder for less and less.  That tends to ring true with voters because that is a very accurate description of what so many of them are actually experiencing, but what the politicians don’t tell us is that they are the ones to blame for the situation that we are in.  As millions of jobs become obsolete because of technology and millions of other jobs are shipped overseas, our politicians tell us over and over that we can “compete” with anyone and that if we will just go out and get some more education we can make it happen.  But those of us who are extremely over-educated know what a fraud that line is.  The truth is that there are not nearly enough jobs for all of us no matter how ”educated” we are.  This is creating a lot of anger and frustration, and now even the IMF is warning that we could see “an explosion of social unrest” if high unemployment persists.

But what can be done?  You can’t force large corporations to hire people.  The reality is that there are a couple of huge factors that have brought us to this point.  First of all, advanced technology means that big corporations need fewer people to do the same amount of work now.  Secondly, the globalization of our economy means that U.S. workers have now been merged into a global labor pool where they are in direct competition with workers who are more than happy to make less than a dollar an hour on the other side of the world.

This all means that the labor of American workers is less valuable to global corporations than it ever has been before.  Advanced technology and computers have enabled corporations to operate leaner and meaner.  If they do need some old-fashioned muscle for certain tasks they can always run out and set up a facility in some third world nation where they can pay people close to slave labor wages and where they don’t have to worry much about taxes, regulations, unions, health benefits or pension plans.  

What did you think was going to happen when the United States entered into all of these “free trade” agreements with nations around the world that did not have minimum wage laws?

U.S. corporations are not in existence to provide the American people with jobs.  They are in existence to make money.  If they can make more money by shipping jobs overseas, then that is exactly what they are going to do.

According to Tax Notes, between 1999 and 2008 employment at the foreign affiliates of U.S. parent companies skyrocketed 30 percent to 10.1 million. During that same time period, U.S. employment at American multinational corporations declined 8 percent to 21.1 million.

Are you starting to see the picture?

Global corporations based in the U.S. have been creating lots of jobs – just not in the United States.

In fact, things only seem to be accelerating.

In 2008 alone, U.S. employment at American multinational corporations fell by 445,500.

In the old days, you could give tax breaks to U.S. firms and that would spur them to do more business and to hire more workers.  But today, if U.S. multinationals decide they wish to expand they will just go hire more third world workers and pocket the rest of the profits for themselves.

The reality is that we are facing a very disturbing long-term trend in the United States.  Today, over half of all unemployed workers in the United States have been out of work for over six months.  In fact, the duration of unemployment in the United States has spiked up to the highest level it has been at since World War II….

This has created a growing subclass of people in the United States who feel that the system has failed them.  The anger and the frustration in the country is rising every day.  You can almost feel it.

In fact, the IMF is warning that we are at risk of “an explosion of social unrest” due to this unemployment crisis.

The head of the IMF, Dominique Strauss-Kahn, recently made the following statement at an Oslo jobs summit with the International Labour Federation….

“The labour market is in dire straits. The Great Recession has left behind a waste land of unemployment.”

So exactly what is going to turn that around?

Are millions of jobs going to suddenly hop up and return home from overseas?

Is the U.S. government going to suddenly eliminate a whole raft of taxes and regulations and are U.S. workers going to suddenly become much cheaper?

Is the U.S. trade deficit crisis suddenly going to reverse and turn into huge trade surpluses for the United States?

Of course none of those things is going to happen.

America is going to continue to bleed jobs, wages inside the United States are going to continue to be forced down and the standard of living for most Americans is going to continue to deteriorate.

Plus, if the American people don’t have good jobs, they can’t buy homes.  In fact, a growing number of Americans are finding out that they can’t even afford the homes they are in right now.  CNBC is reporting that the nation’s banks repossessed a record number of homes in August.

But for many Americans, a foreclosure is just the beginning of their problems.  People are falling out of the middle class at an alarming rate.  Approximately 45 million Americans were living in poverty during 2009.  That is an absolutely astounding figure.

The American people are getting mad and faith in the economy is plummeting.  According to Gallup, confidence in the economy is way down compared to to the same period last year.

So what is going to happen when (not if) things get even worse?

Well, some investors are already anticipating rough times ahead and are flocking to commodities.  The price of gold soared to a record intra-day high of $1,276.50 an ounce on Tuesday, and the price of gold and other commodities will probably continue to climb as economies around the world continue to destabilize.

These are very, very difficult times that we are moving into.  There are not going to be nearly enough jobs for everyone.  People you know are going to be unemployed.  People you know are going to lose their homes.  People you know might even end up living on the streets.

Just hope that you don’t end up being one of them.

The Economic Collapse