How Limousine Liberals Support the Rich

I just sent this letter to the editor of my local newspaper, the Olive Press. I have been writing to them each month:

A number of Olive residents have questioned my claim that limousine liberals favor the wealthy, i.e., themselves. The financial elite has often been called the military industrial complex (MIC) but is more accurately a nexus of real estate, Wall Street and commercial banking with the MIC and so I will refer to it as the banking elite.

Gabriel Kolko in his Triumph of Conservatism shows that the establishment of the Federal Reserve Bank was part of a larger movement, Progressivism, that reflected the banking elite's interests. This followed three decades of cumulative politicization of the economy by the Mugwumps and Populists of the 1880s and 1890s. One fruit of these movements, the 1890 Sherman Anti-trust Act, supported increasing concentration of industry. Martin J. Sklar provides detailed documentation in his Corporate Reconstruction of American Capitalism 1890-1916. The Federal Reserve Act in 1913 further enhanced the banking elite's domination, which was accelerated in 1932 when Franklin D. Roosevelt abolished the gold standard and confiscated all privately held gold.

The way that the Federal Reserve Bank helps the banking elite at the expense of the average American is that it increases the number of dollars in circulation, distributing them to the banking system. The banking system takes the reserves that the Fed gives it and expands the reserves further through fractional reserve banking. Briefly, when the fractional reserve banking system receives a Federal Reserve deposit (created out of thin air) of one dollar, it can expand the number of dollars by ten. Thus, the Federal Reserve Bank, which the banking system legally owns, can create deposits (reserves) out of thin air and then the banks can lend up to ten times the reserves also out of thin air. In other words, the Fed and the banking system cheapen the dollars that you own.

Economists, who are on the banking elite's payroll through consultancies, endowed chairs, and appointments to the Federal Reserve Bank staff, serve as an important propaganda source. They claim that the reserves are distributed evenly throughout the economy. Of course, this claim is absurd. Limousine liberals like William Greider (author of Secrets of the Temple) claim: (a) the Federal Reserve Bank helps the middle class but (b) the Federal Reserve Bank gives hundreds of billions of dollars to Bunker Hunt, Wall Street speculators and recipients of foreign investment. Limousine liberals never question how it might be possible to give hundreds of billions to Wall Street banks and at the same time help the average American.

Thus, at the foundation of big government is big subsidy to the banking elite. But that's the least of big government's subsidy to limousine liberals. A bigger way is the Fed's bloating of the stock market. The way the Fed's monetary expansion bloats the stock market is by reducing interest rates. Low interest rates mean higher stock prices. The present value of future dividend payments are higher at a lower interest rate. Since stocks are present value indicators of a firm's future profits, lower interest rates reduce the discount factor and raise stock prices.

The income inequality about which limousine liberals shed crocodile tears is due to the system which they put in place: by keeping interest rates low, stock prices are buoyed and wealthy limousine liberals like George Soros and Warren Buffett become richer. The way that interest rates are kept low is by the Fed's and the banking system's increasing the amount of money. The increasing amount of money leads to higher prices (inflation). Higher prices mean the average American becomes poorer. Thus, the inflation adjusted wages of workers are reduced while stock prices are increased and the wealthy become wealthier. No source has advocated this system more aggressively or for longer than the New York Times.

The period of the Fed's greatest power began in 1971 and continues today. During this 39 year history, American workers' wages began to stagnate in the early to mid 1970s. They continue to stagnate today. American workers today earn per hour what they earned in 1971. Prior to 1971, real hourly wages increased 2% per year. The post 1971 period saw massive increases in stock prices and increasing income inequality. All of this is due to the policies of limousine liberals, beginning with Franklin D. Roosevelt, who abolished the gold standard, and Richard M. Nixon, who declared "We are all Keynesians now."

Sincerely,


Mitchell Langbert

Ernie Haase & SSQ -- I Then Shall Live

Jim Crum forwarded this video.

Glenn Beck on Global Warming

I seem to have been misinformed about Glenn Beck's position on global warming. These two videos suggest that World Net Daily's claim that Beck favors the global warming hypothesis may have been false. In the first video guest John Coleman calls global warming a scam. Coleman blames the "mainstream" (sic) press. In the second video Beck reports on the e-mails. So once again I have egg on my face concerning Beck, by way of World Net Daily this time.

Mass Murder and the Socialist State of Mind

Aleksandr Solzhenitsyn's Gulag Archipelago spurred me to libertarianism, but I had read another book about mass murder, Hannah Arendt's Eichmann in Jerusalem: A Report on the Banality of Evil a few years before when I was an undergraduate. I am re-reading Arendt's book and am struck by her controversial claim that the Judenraten, the Jewish administrative agencies that oversaw the holocaust, were in fact absolutely essential to the entire holocaust. In other words, Eichmann and the Nazis had to count not only on the Jews' submission, but on their cooperation, in seeing to their own deaths.

On page 125 Arendt writes:

"But the whole truth was that there existed Jewish community organizations and Jewish party and welfare organizations on both the local and the international level. Wherever Jews lived, there were recognized Jewish leaders, and this leadership almost without exception, cooperated in one way or another, for one reason or another, with the Nazis. The whole truth was that if the Jewish people had really been unorganized and leaderless, there would have been chaos and plenty of misery but the total number of victims would hardly have been between four and a half and six million people. (According to Freudiger's calculations about half of them could have saved themselves if they had not followed the instructions of the Jewish Councils. This is of course a mere estimate, which, however, jibes with the rather reliable figures from Holland and which I owe to Dr. L. de Jong, the head of the Netherlands State Institute for War Documentation. In Holland, where the Joodsche Raad like all the Dutch authorities very quickly became an 'instrument of the Nazis,' 103,000 Jews were deported to the death camps...Only five hundred and nineteen Jews returned...In contrast to this figure, ten thousand of those twenty to twenty-five thousand Jews, who escaped the Nazis--and that meant also the Jewish Council--and went underground survived; again forty to fifty per cent...)"

Why the willingness among Jews to comply with a government intent on killing them?

Arendt blames this on Nazism's causing a moral collapse, but I think that claim is incorrect. Similar phenomena were seen in the Soviet Union and China. It is not attributable to Nazism, but rather to the tribalist philosophy of socialism in general, to what Popper calls the "closed society". Moreover, elements of it exist here in the US and have increased in force as the public has become increasingly trusting and obsequious to the state. For example, if the US Supreme Court violates the law and claims the state's right to seize property for corrupt private interests, the public does not see a violent action but rather a justifiable state position.

The socialization of conscience has two additional sources. The first is ordinary conformity that the famous experiments of Stanley Milgram exposes. The second is the other directedness that David Riesman discusses in his Lonely Crowd.

Trust in government, other-directedness and conformity to state directed norms are associated with the socialist mode. In twentieth century Europe, the socialist mentality of compliance and support for the state had extended to a much greater extent than it has here in the United States. What is shocking about this process is that, given sufficient governmental and social pressure, and given Jews' widespread acceptance of the socialist model, Jews were willing to see themselves murdered rather than question the power of the German socialist state.

Should Americans comply with the dictates of government? With the IRS? Do we have a single reason to trust the government of George W. Bush or Barack Obama?