Americans Should Be Free to Choose Their Currencies

An economist named James Galbraith was just on Bloomberg television telling viewers that a raise in interest rates would be catastrophic because US borrowers would have to pay higher interest rates to foreign lenders were interest rates to be raised. This is half true. The half that Professor Galbraith omits is that this policy causes resources to be redistributed from the American people and foreign lenders to borrowers, namely Wall Street and big business. In his view, if commercial banks and Wall Street do not get to cheat foreign lenders and the American people (through inflation) then the situation is catastrophic. The only acceptable situation in Professor Galbraith's view is where Wall Street and big business steal from the poor and where borrowers cheat lenders.

Professor Galbraith's short term thinking is precisely why the American people are becoming poorer. If you cheat your lenders then they will not lend to you. If you subsidize borrowers at the expense of productive workers (through inflation) then productive work will disappear. There is nothing catastrophic about asking that dollars that have been borrowed be repaid in dollars that are still worth the same amount. James Galbraith finds this concept to be catastrophic.

The dialogue about the dollar is steeped in deception of the kind that Professor Galbraith offers. But until the twentieth century, Americans did not have to use the increasingly worthless greenbacks (they are not dollars) that the Federal Reserve Bank prints. We did not have to try to grasp the arguments of academic con men, Wall Street cheaters and perpetrators of banking fraud.

It is time to establish a competitive monetary system. Americans should be free to reject the greenback and to establish a true dollar based on criteria established through private contract. Competition with respect to money would reflect democracy and market freedom. Why not have free choice with respect to the money we need to accept? What virtue is there in being forced to accept mismanaged greenbacks? Why can't the states, private banks or private firms issue their own money? Why can't borrowers insist on being paid back in gold as some did in the nineteenth century?

Cognitive Limits on Progressivism

The limitations of progressivism are illusted in the limitations of progressivism's advocates, such as Peter Levine. Progressivism purports to reform the economy, but progressivism's advocates are not well-schooled in economic problems and constraints. Considerations that need to be integrated in fundamental thinking about society are the unforeseen effects of policy changes; the evolution of technology to render a given set of economic arrangements obsolete in shorter time frames than it takes to implement government reforms that work; the ability of individual employees and entrepreneurs to integrate information more flexibly and intelligently than can experts or central planners; the inability of deliberative processes to anticipate market and technological change; and the inability of deliberators to assess the true costs and benefits of the very changes they propose at the time and place that they propose them. Progressivism assumes unbounded rationality on the part of planners and executives. Yet, planners and executives err more often than they succeed. Progressivism does not anticipate the failure of the firms, technologies, reforms and policies that it proposes, so by definition it results in the institutionalism of antiquated and outdated process, technologies and ideas. There is little that can be new in the ideas that progressives propose; and the reforms that they propose stall progress.

Progressivism aims for contradictory ends and so cannot achieve its purported ends. It aims to increase centralization of authority by enhancing government power. But democracy depends on public participation which in turn depends on decentralization of authority. Progressivism aims for increasing public voice. But it bestows the opportunity for unitary authority on a centralized power. How can such an ideology achieve anything more than tyranny?

Barack Obama Is A Racist and, Worse, a Social Democrat and a Progressive

Howard S. Katz has just written blog that argues that Barack Obama is a racist:

"...Barack Obama is a racist. He sees white people through the prism of hate. He sees them in clichés...So now we know what the election of 2008 is really about. The Democrats may nominate a racial bigot who hates the large majority of the people in the country he is trying to lead. The campaign will be very simple. The Democrats probably won’t come right out and say it, but their position will be, “We hate America...

"I first met these people at Harvard in the late 1950s. The issue has nothing to do with black or white. They hate America because America is the country based on freedom. They are not liberals. Neither are they democrats (with either a lower or upper case “D”).

"The formal name of these people is Social Democrat. This was a movement founded in 1875 in Germany to prevent the ideas of freedom and democracy from advancing across the continent of Europe. In 1912, the Social Democrats took control of Germany and fomented W.W.I. Then another Social Democrat, named Adolph Hitler, fomented W.W. II.

"...This will be the Presidential campaign of 2008. The Democratic position will be, “We hate America.” The Republican position will be mealy-mouthed compromise. And the people of the world run around killing each other over the food which does not exist"

There is little doubt in my mind that Barack Obama represents a fringe element. There is also little doubt that the Democrats who back him, such as George Soros and Warren Buffett, are anti-American bigots.

Barack Obama and the Republicans

Following three decades of Republican complicity with leftist occupation of our educational system, these spring chickens are coming home to vote for Barack Obama.

Lance Fairchok of American Thinker has an excellent blog (hat tip Larwyn) about Barack Obama's advisors. Barack Obama is not just a befuddling liar. Most twenty-first century politicians can be so described. What distinguishes Mr. Obama is his close association with a catalog of extremists, to include his pastor, Jeremiah Wright, who is obsessed with identity politics, and William Ayers, a founder of the Weathermen in the 1960s.

As I have previously blogged, the close association between Obama and the identity politics fringe of the Democratic party is important because he will select high level staffers from among his extremist catalog. Fairchok performs a public service by pointing out that Obama is:

-supported Daniel Ortega in Nicaragua
-associated with Frank Marshall Davis who is in turn associated with the Communist Party USA
-has hired Sam Graham Nelson, a writer for Socialist Viewpoint, to run an Obama blog

None of this surprises. If you catalogued the staff members of the Democratic Party state assemblies around the country, or catalogued the leadership of various education departments around the country, you would find similar kinds of economic illiterates in important government jobs.

The problem is with the Republican Party as much as the Democratic. I attended a meeting of a Department of Education accrediting agency several years ago and was dismayed to find the Bush administration's Department of Education dominated by the very kind of extremists who would look to a Bill Ayers for guidance. Rather than terminate the Department of Education as any competent conservative would, three Republican presidents, Reagan, Bush I and Bush II, have used it as a patronage plumb and have permitted left wingers to dominate its culture.

Rather than insist that colleges teach more than the left wing version of social science, Republicans have remained mostly indifferent to the occupation of our universities by extremist kooks like Ayers.

Rather than appoint Diane Ravitch to an important policy position, the Republicans have remained silent as left wing indoctrination occurs in elementary schools around the country, specifically to include New York's. I am intimately familiar with New York's because I teach in a public New York university, and if you have any doubt that large numbers of New York City elementary school students have been brainwashed in stupid, Marxist lies rather than educated please allow me to quell your doubts.

The Republicans have remained silent while the left has occupied our cultural institutions. Instead of complaining, the Republicans have viewed the left wing imperialism as a foundation to expand patronage opportunities.

With Barack Obama, the chickens are coming home to roost. America's public has NOT been educated in the founding principles. The concept of limited government is alien to most American school children. The concepts of self reliance and individualism on which progress depends have been neglected. America's young believe that the way to succeed in life is to steal. As a result, they flock to the likes of Barack Obama and Hillary Clinton.

By its indifference to the domination of our political institutions by left wing thugs and criminals the Republican Party has fostered the situation.