Archive for February, 2009

Gun Control: 56 million deaths

February 28, 2009


In 1929, the Soviet Union established gun control. From 1929 to 1953, about 20 million dissidents, unable to defend themselves, were rounded up and exterminated.  

In 1911, Turkey established gun control. From 1915 to 1917, 1.5 million Armenians, unable to defend themselves, were rounded up and exterminated.  
Germany established gun control in 1938 and from 1939 to 1945, a total of 13 million Jews and others who were unable to defend themselves were rounded up and exterminated
China established gun control in 1935. From 1948 to 1952, 20 million political dissidents, unable to defend themselves, were rounded up and exterminated.  
Guatemala established gun control in 1964. From 1964 to 1981, 100,000 Mayan Indians, unable to defend themselves, were rounded up and exterminated.  
Uganda established gun control in 1970. From 1971 to 1979, 300,000 Christians, unable to defend themselves, were rounded up and exterminated.  
Cambodia established gun control in 1956. From 1975 to 1977, one million ‘educated’ people, unable to defend themselves, were rounded up and exterminated.  
Defenseless people rounded up and exterminated at the hands of the state in the 20th Century because of gun control: 56 million.
The Australian Experience


In the 12 months after gun owners in Australia were forced by new law to surrender 640,381 personal firearms to be destroyed by their own government (a program costing Australia taxpayers more than $500 million dollars), the results were:  
Australia-wide, homicides are up 3.2 percent  
Australia-wide, assaults are up 8.6 percent  
Australia-wide, armed robberies are up 44 percent (yes, 44 percent) 
In the state of Victoria alone, homicides with firearms are now up 300 percent. Note that while the law-abiding citizens turned them in, the criminals did not, and –as always- criminals still possess their guns despite gun control ‘laws’.

It will never happen here? I bet the Aussies said that too. 
While figures over the previous 25 years showed a steady decrease in armed robbery with firearms in Australia, this has changed drastically upward since the ban and confiscation, since
criminals now are guaranteed that their prey is unarmed.
There has also been a dramatic increase in break-ins and assaults of the elderly. Australian politicians are at a loss to explain how public safety has decreased after such monumental effort and expense was expended in ‘successfully’ ridding Australian society of guns. The Australian experience and the other historical facts above demonstrate the hopelessness of civilian disarmament – both in terms of crime-prevention, and in terms of eliminating the last line of defense between citizens and the ever-expanding state.
You won’t see this data on the US evening news, or hear politicians disseminating this information.  
Guns in the hands of honest citizens save lives and property and, yes, gun-control laws adversely affect only the law-abiding citizens.  
Take note my fellow Americans, before it’s too late.  
The next time someone talks in favor of gun control, please remind him of this history lesson.  
With Guns………..We Are “Citizens”.  
Without Them……..We Are “Subjects”.


There, but for the grace of God, go we

February 27, 2009


Malevolent voices that despise our freedoms


The image of this nation that haunts me most powerfully is that of the sleeping giant Albion in William Blake’s prophetic books. Sleep, profound and inveterate slumber: that is the condition of Britain today.

We do not know what is happening to us. In the world outside, great events take place, great figures move and act, great matters unfold, and this nation of Albion murmurs and stirs while malevolent voices whisper in the darkness – the voices of the new laws that are silently strangling the old freedoms the nation still dreams it enjoys.

We are so fast asleep that we don’t know who we are any more. Are we English? Scottish? Welsh? British? More than one of them? One but not another? Are we a Christian nation – after all we have an Established Church – or are we something post-Christian? Are we a secular state? Are we a multifaith state? Are we anything we can all agree on and feel proud of?

The new laws whisper:

You don’t know who you are

You’re mistaken about yourself

We know better than you do what you consist of, what labels apply to you, which facts about you are important and which are worthless

We do not believe you can be trusted to know these things, so we shall know them for you

And if we take against you, we shall remove from your possession the only proof we shall allow to be recognised

The sleeping nation dreams it has the freedom to speak its mind. It fantasises about making tyrants cringe with the bluff bold vigour of its ancient right to express its opinions in the street. This is what the new laws say about that:

Expressing an opinion is a dangerous activity

Whatever your opinions are, we don’t want to hear them

So if you threaten us or our friends with your opinions we shall treat you like the rabble you are

And we do not want to hear you arguing about it

So hold your tongue and forget about protesting

What we want from you is acquiescence

The nation dreams it is a democratic state where the laws were made by freely elected representatives who were answerable to the people. It used to be such a nation once, it dreams, so it must be that nation still. It is a sweet dream.

You are not to be trusted with laws

So we shall put ourselves out of your reach

We shall put ourselves beyond your amendment or abolition

You do not need to argue about any changes we make, or to debate them, or to send your representatives to vote against them

You do not need to hold us to account

You think you will get what you want from an inquiry?

Who do you think you are?

What sort of fools do you think we are?

The nation’s dreams are troubled, sometimes; dim rumours reach our sleeping ears, rumours that all is not well in the administration of justice; but an ancient spell murmurs through our somnolence, and we remember that the courts are bound to seek the truth, the whole truth, and nothing but the truth, and we turn over and sleep soundly again.

And the new laws whisper:

We do not want to hear you talking about truth

Truth is a friend of yours, not a friend of ours

We have a better friend called hearsay, who is a witness we can always rely on

We do not want to hear you talking about innocence

Innocent means guilty of things not yet done

We do not want to hear you talking about the right to silence

You need to be told what silence means: it means guilt

We do not want to hear you talking about justice

Justice is whatever we want to do to you

And nothing else

Are we conscious of being watched, as we sleep? Are we aware of an ever-open eye at the corner of every street, of a watching presence in the very keyboards we type our messages on? The new laws don’t mind if we are. They don’t think we care about it.

We want to watch you day and night

We think you are abject enough to feel safe when we watch you

We can see you have lost all sense of what is proper to a free people

We can see you have abandoned modesty

Some of our friends have seen to that

They have arranged for you to find modesty contemptible

In a thousand ways they have led you to think that whoever does not want to be watched must have something shameful to hide

We want you to feel that solitude is frightening and unnatural

We want you to feel that being watched is the natural state of things

One of the pleasant fantasies that consoles us in our sleep is that we are a sovereign nation, and safe within our borders. This is what the new laws say about that:

We know who our friends are

And when our friends want to have words with one of you

We shall make it easy for them to take you away to a country where you will learn that you have more fingernails than you need

It will be no use bleating that you know of no offence you have committed under British law

It is for us to know what your offence is

Angering our friends is an offence

It is inconceivable to me that a waking nation in the full consciousness of its freedom would have allowed its government to pass such laws as the Protection from Harassment Act (1997), the Crime and Disorder Act (1998), the Regulation of Investigatory Powers Act (2000), the Terrorism Act (2000), the Criminal Justice and Police Act (2001), the Anti-Terrorism, Crime and Security Act (2001), the Regulation of Investigatory Powers Extension Act (2002), the Criminal Justice Act (2003), the Extradition Act (2003), the Anti-Social Behaviour Act (2003), the Domestic Violence, Crime and Victims Act (2004), the Civil Contingencies Act (2004), the Prevention of Terrorism Act (2005), the Inquiries Act (2005), the Serious Organised Crime and Police Act (2005), not to mention a host of pending legislation such as the Identity Cards Bill, the Coroners and Justice Bill, and the Legislative and Regulatory Reform Bill.


And those laws say:

Sleep, you stinking cowards

Sweating as you dream of rights and freedoms

Freedom is too hard for you

We shall decide what freedom is

Sleep, you vermin

Sleep, you scum.

Philip Pullman will deliver a keynote speech at the Convention on Modern Liberty at the Institute of Education in London tomorrow



Civilian Disarmament: Here it comes

February 26, 2009


This just in:


As President Obama indicated during the campaign, there are a few gun related changes that we would like to make, and among them would be to reinstitute the ban on the sale of assault weapons, Holder told reporters.


Then there’s this gem:


“I think that will have a positive impact in Mexico, at a minimum.” Holder said at a news conference on the arrest of more than 700 people in a drug enforcement crackdown on Mexican drug cartels operating in the U.S.

Mexican government officials have complained that the availability of sophisticated guns from the United States have emboldened drug traffickers to fight over access routes into the U.S.

A State Department travel warning issued Feb. 20, 2009, reflected government concerns about the violence.

‘Some recent Mexican army and police confrontations with drug cartels have resembled small-unit combat, with cartels employing automatic weapons and grenades,’ the warning said. ‘Large firefights have taken place in many towns and cities across Mexico, but most recently in northern Mexico, including Tijuana, Chihuahua City and Ciudad Juarez.'”


So let me understand this: because cartels in Mexico have been employing automatic weapons and hand grenades – weapons unavailable for civilian purchase in the United States – we should be banning the sale of semi-automatic ‘assault’ weapons?  This appears to be the ‘pitch’ the state will make.  Doubtless it will resonate with those ‘moderates’ who can understand ‘common sense gun control’.


But wait, it gets better.  The ABC news article does not tell the whole story


H.R. 45 would require a federal license for all handguns and semiautomatics, including those you currently possess;


And it would require handgun and semi-auto owners to be thumb-printed at the police station and to sign a certificate that, effectively, the firearm will not be kept in a place where it would be available for the defense of the gun owner’s family.


A federal firearms database with no grandfathering.  Restrictions on storage within one’s own home.  Registration with the police.  Presumably restrictions on carry.


Remember you read it here on January 27th:


As discussed previously, one of the most fundamental ploys of the state is to disarm the people and make self defense a crime. In the United States we are half way to the former and most of the way to the latter. Yes, there has been resurgence in ‘castle doctrine’ laws recently, but use a firearm to defend yourself against an assailant inside or outside of your home and expect to be arrested, questioned and detained while the state determines whether your action was ‘justified’.


Once the people are largely disarmed and disincented, if not outright prohibited from defending themselves, the state will then create a permanent, full-time police force to provide for your defense. Bureaucracies and taxes will be then be expanded to support such a force. Over time, the force will be expanded to include various specialist divisions – drugs, traffic, undercover secret police, etc – and bureaucracies will expand and overlap accordingly – federal, state, county and local – until the people suffer a vast web of agencies each in charge of policing the same group: the people. Fortunately for the agents of the state, its various bodies will be busy legislating and regulating away the people’s liberties and creating new ‘crimes’ against which they might then police.


If passed, what if one resists this law based on one’s Constitutional rights (2nd and 4th amendments) and, more importantly, one’s God-given right to self-defense? 


That’s when the agents of the state come in – you know, the ‘friendly officers’ of ‘law enforcement’.  First come ‘officers’ at your door with guns drawn.  Then come the tasers.  Then come the hand-cuffs.  Then comes prison.  Think this is an exaggeration?  I’ve been down this road personally.  Test the current firearms restrictions and let me know what happens.  I think you can email from the prison library under certain circumstances.


From January 21st:


The state disarms you, and makes it functionally illegal to defend yourself.  Then, through its near-monopoly on force, the state confiscates your income in the form of wage taxation in order to protect you.  When that is not enough, and the state machine is once again hungry for more money, the state will create new crimes… in order to sustain and expand its various agencies.  These agents of the state will then seek to sustain and expand their role in regulating the people.


Where are all those who emailed me regarding my drawing attention to the National Guard’s recently planned training for door-to-door searches of American households?  Where are those who called me a ‘propagandist’?


Wake up Patriots!  Don’t say nobody warned you. 


Orwellian Nationalization: ‘no plan’ for Credit Default Swaps

February 26, 2009

Today, regarding GM, Reuter’s reports:


GM posted a deeper-than-expected quarterly loss as revenue plunged by more than a third.  The automaker warned its pension plans for hourly and salaried workers were underfunded by about $12.4 billion as of the end of 2008.


The company, which has been kept afloat with emergency loans from the U.S. government since the start of the year, posted a net loss of $30.9 billion for 2008.  That ranked as the second largest annual loss for the 100-year-old automaker on record behind only the $38.7 billion loss recorded in 2007.


GM has asked for a total of up to $30 billion in total aid from the U.S. government to survive a plunge in sales in the global auto market.


GMs senior management team and board of directors remain in place.


Today, regarding Citigroup, Fox business news reports:


Citigroup Inc.’s bid to boost its equity capital could result in the federal government raising its stake in the troubled bank this week to as much as 40 percent…


Citigroup has already received $45 billion in U.S. bailout money made up primarily of debt-like preferred shares, plus federal guarantees to cover losses on some $300 billion in risky investments.


Citigroup’s senior management team and board of directors remain in place.


Today, regarding AIG, the Financial times reports:


AIG and the US authorities are in advanced discussions over a radical restructuring that would split the stricken insurer into at least three government-controlled division in an attempt to keep it afloat…


Under the plan, the government would swap its current 80 per cent holding in the insurer for larger stakes in three units…


However, people close to the situation said AIG was on track to… report a $60 billion loss with its fourth-quarter results.


AIG’s senior management team and board of directors remain in place.


All of this begs the question – what is the difference between pumping hundreds of billions of dollars in taxpayer money into these companies and simply nationalizing them?  There are two differences, and each one is bad news for the taxpayer. 


The first difference is that, under the current plan, directors and management continue to earn compensation, set strategy and execute tactics.  The taxpayer, through the federal government, is on the hook for the money, but has no direct say in how the company is run.  The main difference, however, has to do with controlling interest and credit default swaps.


Controlling interest and credit default swaps


First, let’s look at GM.  I quote an observation made on this site on January 21st:


Here is the real story, the one you won’t hear on the news:

As you now know, after weeks of downplaying the issue, Treasury, a few days before the bailout was finalized, hinted it may actually be willing to use TARP funds to fund a short-term bail-out for the Big Three. You may ask yourself why the reversal.

If you remember, GM brought in the BK attorneys about a week before ‘to consult’. This move was aimed at squarely at the capital markets: GM has roughly $1 trillion in outstanding credit default swaps.

There are tens of trillions in unresolved CDS out there. The problem of unwinding these swaps in the absence of a CDS exchange (to monitor liquidity or carry out liquidations to cover positions) is at the heart of this financial crisis. As many of the original readers (pre-wordpress) remember me saying over a year ago, this crisis has little to do with mortgages. This is a capital markets crisis.

This is why reorganization through a BK court has not seriously been entertained.

If a BK court was allowed to resolve credit default swaps, it would rattle the financial markets beyond the control of the central banks. The decisions of the BK court would set precedent that could then be used to challenge CDS agreements in court. Further, these precedents would stand in other BK proceedings (think Lehman) and major financial institutions (already functionally insolvent) would collapse.

Next, let’s look at Citi and AIG, both the insurers and the insured, of hundreds of billions of dollars in notional credit default swaps.  The reason why this pseudo-nationalization is occurring (all of the exposure of nationalization without the controlling interest) is that nationalizing a bank or major financial corporation would create a ‘credit event’, or event of default, that would trigger payouts of debt insurance contracts beyond any insurer’s capacity to pay.  In the absence of an exchange to manage the unwinding of CDS contracts and liquidate insolvent market participants, there is simply no way to unwind the mess – in other words, complete seizure and potential collapse of the global ‘FIRE’ economy (finance, insurance, real estate) that is central to the central-banking, fiat money, fractional reserve lending, modern state-controlled economy.


Therefore, as if nationalization weren’t bad enough, we now have Orwellian Nationalization: the taxpayer is on the hook for the bad debt, but the same geniuses are still running the show – at GM, at AIG, at Citi, at Bank of America, et. al.


There are essentially three options for dealing with insolvent financial firms.


1. Bankruptcy and liquidation: this is the only effective solution, one for which ample precedent already exists and the only one I favor.  Under this scenario, insolvent financial firms simply go out of business.  Equity holders are wiped out (the ‘risk’ portion of the risk/reward stock market dynamic).  The company is broken up and assets of any value are sold to pay creditors.  Stronger firms may opt to purchase pieces of the broken-up, bankrupt organization and often get good deals on segments that still have value.


2. Nationalization: this is final and decisive act by government and includes variations such the creation of a ‘bad bank’ model.  In a pure nationalization, government may directly run the nationalized firms as ‘government banks’ – look for these types of solutions in Europe as the crisis worsens.  Another variation is the ‘bad bank’ model, such as the Resolution Trust Corporation the federal government employed during the S&L crisis.  In this variation, insolvent financial firms are taken over by the government and assets are split: performing assets are sold off to liquid competitors, while the illiquid assets are maintained in a government-run holding company and slowly liquidated.  Direct nationalization is a disaster as government has neither the expertise nor managerial ability to effectively run a large, global bank.  The ‘good bank/bad bank’ scenario would be a disaster due to the sheer dollars involved and the lack of oversight on the trillions of dollars spent so far.  What typically happens is that investors, creditors and senior management own the good bank.  You, the tax payer, end up owning the bad bank.  Naturally, investors, creditors and senior executives favor this solution.


3.  Orwellian Nationalization: in an effort to kick the CDS can down the road, this is what we have today.  The way this works is that government guarantees the bad debt of insolvent financial institutions ad infinitum.  First, hundreds of billions of dollars are pumped into these firms.  When this ‘investment’ by government changes nothing, hundreds of billions more dollars are fed into the meat grinder.  Soon, billions turn into trillions.  And the status quo remains – insolvent institutions with hundreds of billions in non-performing tier 3 assets remain insolvent.  Unfortunately, a new, perverse dynamic is created.  Capital flows to where it perceives it is most protected.  With implicit government guarantees turning explicit by the day, investors abandon good, solvent banks in favor of government-guaranteed banks.  Why not?  Why take the risk with a free-standing, private bank when you can invest in one that is backed by the printing press of the federal reserve?  In this manner is perverse incentive laid upon perverse incentive.


The important thing to remember here, as frequent readers know, is that the federal government does not have any money.  The only money the federal government can spend is that which is confiscated from productive citizens in the various forms of overt taxation, or that which it can borrow.  The interest on that borrowed money is inflation – the covert tax on every private, fiat dollar earned or owned, in perpetuity.


And so George Orwell would be proud.  Bernanke has “no plans” to nationalize insolvent American banks.  There is much truth to this statement.  While insolvent banks will eventually be nationalized, it is true that Bernanke has ‘no plan’ on how to do this without triggering uncontrollable events in the international, state-controlled, fractional reserve, fiat money economy.






Fiat economics and the nature of the state

February 25, 2009

Unsustainable Indebtedness

While much has been made of the levels of consumer indebtedness of the past several decades, and particularly over the past 5-10 years, not nearly as many have focused on the true debtors of our economy: corporations and the state.

This succinctly written piece addresses the issue and is worth a complete read. A few excerpts follow:

US businesses went in for “Cash Management” – which was supposed to minimize cash balances – short cash – and go long on purchasing short-term or overnight debt from banks to meet coming maturities. Holding plain cash or checking account balances was old fashioned.
Worse, businesses also wanted to expand at all costs. Extend more credit – short your merchandise and go long on accounts receivable – in order to increase sales. Car manufacturers had their own financial arm, to enable them to short their own excess production of autos, and to go long on debts due from customers up to six, seven years out.

The phrase ‘going long’ on debt accurately describes the position of not only financial institutions, but nearly all major corporations in the United States and, as we have found out, internationally. But financial institutions in particular are in a uniquely vulnerable position when they are ‘short’ cash. Why? Because of the dreaded ‘run on the bank’ – which we have seen transpire in fits and starts going back to when money market funds finally broke the buck, when several large depository institutions were run down (Washington Mutual and Wachovia come immediately to mind) and currently with the dwindling solvency of both Citicorp and Bank of America.

The squeeze on those who shorted cash is now tremendous. The figures on outlandish leverage in US banks and the figures on household debt illustrate the situation. The Fed and the ECB are trying to meet and overcome the short squeeze by providing enormous amounts of money, available at the banks, in an effort to provide funds to those who are trying to cover their shorts on cash by going long – obtaining cash – to cover their long positions on debts owed.
The enormous increases in cash available at the banks are insignificant in comparison with the prevailing enormous shorts on cash and long positions in debt. The squeeze is implacable.
In effect, everyone on God’s green earth is trying to obtain cash – going long on cash – in order to cover their long positions on debt.
What we now see is the opposite effect – the deflationary environment created when both corporations and individuals turn on a dime, moving from long debt/short case to short debt/long cash. The dramatic slowdown in the velocity of money creates a deflationary dynamic of depressionary proportions.

The author describes this as follows:

“Cash is being hoarded by banks and consumers alike” means “Banks are going long cash and shorting debt (trying to reduce their leverage) and consumers are saving cash (going long on cash) and shorting spending.”

Deflation and Depression are actually a manifestation of a massive short squeeze on cash in an attempt to reduce a gross and unsustainable long position on debt.

The problem, however, is that the United States central bank (the Fed) and the ECB have indicated they will stop at nothing in their attempt to get the credit bubble started again. And this is where I take issue with the long-term deflationists:

Bringing all the massive liabilities of the banking system onto the Treasury’s indebtedness – while the corresponding assets are worth far, far less than these liabilities – will solve nothing.

While I agree that the additional money creation and pseudo-nationalizations will solve nothing, I disagree with the implicit argument, as oft-repeated by many known deflationists (many of whom I greatly respect), that government cannot ‘print’ its way out of this current deflation. In a fiat-based, fractional reserve economy, the state can absolutely print its way out of a deflationary environment. In fact, our government, as I type this, is running the proverbial printing presses at record pace. The inevitable result of all this, of course, is price inflation. So while Peter Schiff may have got his timing wrong, and misjudged how poorly overseas economies and currencies would fare relative to ours, he is dead-on right in his warnings of the dangers of hyper-inflation.

Political economy

The problem in the deflationist argument is not economics. The economics are sound. The problem is we are not dealing with an economy. Rather, we are dealing with a political economy. The differences cannot be overstated. Within the bubble of our fake-money fiat economy, even a contraction of the total supply of money and credit (the textbook economists definition of inflation) can still lead to price inflation, or even hyperinflation. This is known as an inflationary depression. How this might happen is something that the author and I can agree on:

The driving force behind the rise in the price of gold at this time is not the fear of inflation but rather the fear of placing cash where there is a possibility of default. Only physical gold in possession is free of this risk.

I may add that even national treasuries do default on their bond obligations (Nouriel Roubini just confirmed this) and can and do default partially by devaluing their currencies. The world is gradually realizing this and this is propelling investors into gold.

Could it be there is Method in the government’s Madness? Perhaps the unspoken idea is to save some critical institutions by bailouts at all costs and then – the Treasury defaults later on this year?

Game over

The big risk, and the one nobody in the Mainstream Corporate Media is talking about, is the risk of loss of confidence in U.S. treasuries. If this happens, you will see massive devaluation of the dollar – and all other fiat currencies. If the state, already in debt and spending at warp speed, can no longer borrow, its game over.

Money is not capital

We are already seeing this with the Euro as the storm clouds gather on the Eastern horizon. Should confidence in the dollar (soon to be the last remaining fiat currency of any value) crumble, you will see a flight to hard assets that makes the commodities bubble of last summer look like a hiccup. Capital will flow into precious metals, industrial metals and oil. The price of oil, even amidst declining demand and industrial output, will rise. The price of gold will double, or potentially triple. All this simply because the dollar (or the Euro or any other fiat currency) is not capital. MONEY IS NOT CAPITAL. It is a piece of paper representing a promise to pay. It is debt. And while the monopoly of this money domestically (due to legal tender laws) encourages its use, international capital is dependent on the dollar only so long as it is perceived as a convenient and liquid store of value.

Therefore, the price of gold, silver, oil or a number of other tangible assets does not really rise or fall at all. An ounce of gold is worth the same today as it was in Babylonian times. What changes is the perceived value of a given fiat currency note. In this manner do we ‘value’ gold, or any other hard asset, in terms of the dominant fiat paradigm.

As I have stated before, the problem with the deflationist position is not one of economics, but rather of imagination. Trust that the state has no such failure – legions of staff work day and night for our overlords in Washington to imagine new and creative ways to beg, borrow and steal in order to spend, inflate and protect not you, the American, but their positions of power.

The nature of the state

Such is the nature of the state. We underestimate the lengths the state will go to at our own peril. Remember that the modern American state, the strong federal government, is able to sustain itself only in cooperation with the central bank (the federal reserve). Through the creation and control of fiat money, the state exerts its control through confiscatory taxation and enforcement. This dynamic builds and feeds upon itself until the out-of-control state can no longer contain itself – it can only expand, at the expense of the States or, more specifically, the People. Make no mistake: this is a zero-sum game. Every time the state drafts new legislation, it costs us money. But with each act of the state, we lose much more than money – we lose liberty. We lose this liberty by ceding further power to the state to tax, collect and enforce. No longer do the States and the people stand as a bulwark against the expansionist state. This is a civic duty of every American – to fight against the inherently expansionist central state:

A Republic, madam. If you can keep it…. –Benjamin Franklin

As discussed earlier on this site, deflation adversely effects the very wealthy – the core constituents of our current crop of ‘politicians’ dependent, as they are, upon campaign donations and lobbying money. Inflation disproportiately effects the middle class. The simple reason why is that the wealthy own assets, and the middle class owns money. Do not fool yourself into thinking that the federal government will not, if pressed to make a decision, choose inflation –even hyperinflation- over continued, sustained asset price deflation.

Of course, nowhere have the two things that would empower the middle class – the group thing standing between a corporatist state and the full consolidation of its power. 1) A complete and long-term income tax holiday, thereby allowing the earners of wages to keep the fruits of their labor to do with as they see fit. 2) The elimination of the UNCONSTITUTIONAL central bank and, with it, fiat currency and fractional reserve banking. These two actions would return us to Constitutional economic principles. But suggestions to do so (other than Rep. Ron Paul) are nowhere to be heard.

Those who underestimate to what lengths the state will go to consolidate and expand their power in the event of continued economic crisis and collapse, including creating massive inflation through which the People must suffer, have not read their history, and have not been paying attention to current events. The central state is expanding at an alarming rate, and control of commerce, money and the overall economy are the tools of that expansion – tools sadly ceded to the state by the People. It is time to take them back. Lest we forget the true nature of any central state when threatened with its own survival, I share the following from Roberto Vacca:

The rapid return to universal penury will be accomplished by violence and cruelties of a kind now forgotten. The force of law will be scant or nil, either because of the collapse or disappearance of the machinery of state, or because of difficulties of communication and transport. It will be possible only to delegate authority to local powers who will maintain it be force alone.

… people will endure hardship, and for the greater part of their time they will be labouring to satisfy primitive needs. A few will have positions of privilege, and their work will not consist in… cultivating the soil or in building shelters with their own hands. It will consist in schemes and intrigues, grimmer and more violent than anything we know today, in order to maintain their personal privileges.

Flash forward to 2009 – Views from an American Patriot

February 25, 2009


(Note: the following is my response to a remark made in another forum by a gentlemen attacking my previous article on the national guard training for gun confiscation as “propaganda”, and defending the federal government.  Further, this uninformed antagonist cited the tired example of the Whiskey Rebellion as ‘evidence’ of our Founders’ intent.  As always, I encourage reader comments from both supporters and antagonists.  However, antagonists will have to come armed with more facts than they can gather from ‘wiki’, or they will simply be embarrassed)


Good morning.  I was hoping the statists did their homework.  However, I see no new wisdom is forthcoming.  So let me address this to all the statists and pseudo-Americans out there.  Feel free to google any sentence in my post to confirm I have not plagiarized or simply copy/pasted from some rudimentary wiki-type source:


Our Founding Fathers, generally speaking, were an anti-statist lot.  Despite the compromises that resulted in the Constitution of the United States, the anti-federalists and federalists alike were united by a fundamental distrust of government that ran consistent, in both word and deed, during the debates of the era when these great men were charged with creating a government from the aftermath of the revolutionary war.  In some cases, they built upon and refined the institutions and traditions of English common law.  Other cases, they built upon the independence and frontier spirit of the colonial culture of the time. 


The Whiskey Rebellion is often brought up in statist circles as a ‘proof’ of the intentions of our Founders, and of George Washington in particular, in terms of setting precedent.  However, the truth is more complicated, and sheds light on true American political culture.  While ‘wiki’ is a popular source for snippets of information, I would suggest, instead, no greater authority than Murray Rothbard (Austrian economists will recognize Rothbard as a towering figure of both economics, free-market anarchy and anti-statism).  The following article serves to highlight the Whiskey Rebellion in the context of the time.  Take your time and read it; it is fairly succinct.


This article demonstrates the Agorist tendencies pervasive at the time of the founding of our nation.  These Agorist sympathies were shared to a large extent by our Founding Fathers.  I provide several quotes to back this up:


“The refusal of King George II to allow the colonies to operate an honest money system, which freed the ordinary man from the clutches of the money manipulators, was probably the prime cause of the revolution.”

-Benjamin Franklin


“We must not let our rulers load us with perpetual debt. We must make our election between economy and liberty or profusion and servitude.  If we run into such debt, as that we must be taxed in our meat and in our drink, in our necessaries and our comforts, in our labors and our amusements, for our calling and our creeds… [we will] have no time to think, no means of calling our miss-managers to account but be glad to obtain subsistence by hiring ourselves to rivet their chains on the necks of our fellow-sufferers… And this is the tendency of all human governments. A departure from principle in one instance becomes a precedent for [another ]… till the bulk of society is reduced to be mere automatons of misery… And the fore-horse of this frightful team is public debt. Taxation follows that, and in its train wretchedness and oppression.    

– “Thomas Jefferson, Letter to Samuel Kercheval, Monticello, July 12, 1816


“If the American people ever allow private banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all their property until their children wake up homeless on the continent their fathers conquered.”

-Thomas Jefferson


The anti-tax positions held prior to, during and after the Revolution speak to these sympathies and are addressed by Rothbard.


That our Founding Fathers were minarchists is indisputable.  But one must understand that within each minarchist is a touch of the anarchist.  One does not “propose” anarchy as a system of government.  Anarchy, by definition, is the anti-system.  Instead, one chips away at the state as much as possible, much like an anarchist or agorist might.  If one chips away at the state enough in the direction of anarchy, one arrives at minarchy.


(There are many misunderstands associated with the term “anarchy”.  For more information on this subject, please see here:, here:, and here: )


Our Founders, and Jefferson in particular, envisioned a political culture that was always in flux.  Our Founders understood the inherent problems of a federal state – the ‘mission-creep’ and relentless expansion of power inherent in central government.  The bulwark between this expansionist dynamic (understand that the state can only expand at the expense of the people – this is indeed a zero-sum game) were the States or, more specifically, the People.  Rothbard’s summary of the Whiskey Rebellion serves to illustrate the independence and fortitude of the American people of the time relative to their understanding of their civic responsibility to resist the state and its encroachment upon individual liberties in the form of regulation and taxation.  (Up to and including tarring & feathering tax collectors).  Further, the article demonstrates the lack of both enforcement and compliance typical of the time.  Therefore, the ‘flux’ referred to above is the constant, vigilance of the People and the battle against the state.  Often this battle manifests only in minor acts of civil disobedience or tax revolt.  On the other hand, Jefferson (and others) understood this battle would occasionally break out into something larger.  Some additional quotes on this:


“Guard with jealous attention the public liberty. Suspect everyone who approaches that jewel. Unfortunately, nothing will preserve it but downright force. Whenever you give up that force, you are inevitably ruined.” -Patrick Henry


“I ask sir, what is the militia? It is the whole people. To disarm the people is the best and most effectual way to enslave them.” -George Mason


“Democracy is two wolves and a lamb voting on what to have for lunch.

Liberty is a well-armed lamb contesting the vote.” – Benjamin Franklin


This is a famous one, although many omit the full paragraph and quote only the last few lines, therefore depriving the reader of full context and intent:


The people cannot be all, and always, well informed. The part which is wrong will be discontented, in proportion to the importance of the facts they misconceive. If they remain quiet under such misconceptions, it is lethargy, the forerunner of death to the public liberty. … What country before ever existed a century and half without a rebellion? And what country can preserve its liberties if their rulers are not warned from time to time that their people preserve the spirit of resistance? Let them take arms. The remedy is to set them right as to facts, pardon and pacify them. What signify a few lives lost in a century or two? The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants. It is its natural manure.  – Thomas Jefferson 


Therefore, the minarchy designed by our Founders -again, by both word and deed- was understood to be a prize not just fought for once and won, but rather one that required constant vigilance and anti-statist activity on behalf of the populace: resisting, first by ballot and then by disobedience, the encroachment of the state upon our liberties.


Flash-forward to 2009.  What might Jefferson think of Barack Obama?  Of George Bush?  Of Pelosi, Dodd, and Frank?  Of any of our current or recent crop of political overlords?  What might he think of our tax code?  What might he make of our code of laws – a code that could be stacked floor to ceiling in the Empire State Building?  What might he think of the enforcement of these laws via multiple, overlapping ‘law enforcement’ agencies (agents of the state)?  And what might he suggest be done about this?


I will leave you to ponder this.  But in conclusion, I will share one more quote for those who would accuse me, and many others like me, of being anything other than an American Patriot:


“You need only reflect that one of the best ways to get yourself a reputation as a dangerous citizen these days is to go about repeating the very phrases which our  founding fathers used in the struggle for independence.”

-Charles Austin Beard

National Guard Trains for Gun Confiscation

February 24, 2009


Why would the national guard need this type of training ???


Thanks to the Daily Times-Herald of Carrollton, IA, for publishing this article – it’s certainly not something we would see in the mainstream corporate media.


Once credible intelligence has been gathered,” said Kots, “portions of the town will be road-blocked and more in-depth searches of homes and vehicles will be conducted in accordance with the residents’ wishes.”

“One of the techniques we use in today’s political environment is cordon and knock,” Kots explained. “We ask for the head of the household, get permission to search, then have them open doors and cupboards. The homeowner maintains control. We peer over their shoulder, and the soldier uses the homeowner’s body language and position to protect him.”


The signs are everywhere, and getting increasingly impossible to ignore, even by those who still trust the state.  Start getting prepared.  Don’t be left dependent and helpless.


War games?


Here  is a mainstream corporate media take (emphasis mine):


The U.S. Army prepares soldiers stateside with frighteningly lifelike war games for the guerrilla attacks they will encounter on their tours of duty in Iraq


Trainers at Fort Irwin put stress on soldiers every chance they get. During a search of Iraqi homes, Golf Company found a man with a rifle. Brought outside in handcuffs, the man pleaded to be given over to the Iraqi Police standing nearby. “I.P., I.P.,” he said as a crowd of villagers gathered in the stifling heat. A translator said the man only used the rifle for hunting, but after radioing his superiors, Specialist Drake Hill informed the police that the man would be taken back to a Blue Team base for questioning. That was the right decision.


Are you kidding me??  Does anyone believe this training is for Iraq?  Our soldiers are being trained for gun confiscation on a mass scale.  “…only used the rifle for hunting…”  What was he hunting, camels? 


C’mon folks.  Read the writing on the wall.


U.S. Army trained for civil unrest and crowd control


Here is another gem, straight from the horse’s mouth – or the Army Times, in this case (emphasis mine):


They may be called upon to help with civil unrest and crowd control


The 1st BCT’s soldiers also will learn how to use “the first ever nonlethal package that the Army has fielded,” 1st BCT commander Col. Roger Cloutier said, referring to crowd and traffic control equipment and nonlethal weapons designed to subdue unruly or dangerous individuals without killing them.


This is my favorite:


The package is for use only in war-zone operations, not for any domestic purpose.


Of course it is.  And that’s why units deployed to handle domestic civil unrest are being trained in its use.


“I can’t think of a more noble mission than this,” said Cloutier, who took command in July.  “We’ve been all over the world during this time of conflict, but now our mission is to take care of citizens at home…”


And what if those citizens don’t want to be “taken care of”?  Well, just ask the good citizens of New Orleans and Iowa how the National Guard and police ‘took care’ of them…  Run some searches for images of militarized police with guns trained on civilians – civilians who have committed no crime.


Will they really do it?


I have read several articles where writers assert their belief that American soldiers will not fire on American citizens.  History is unkind to those who share this view.  In fact, history is abundant with examples of soldiers and police all too willing to turn their guns on their fellow citizens.


First, understand that soldiers and police will have limited information.  They will be told there is a domestic terrorist on the loose – or better a group of terrorists.  They will be told this group has committed horrific acts against Americans.  They will be told it’s a boogey-man – a Timothy McVeigh – or a group of boogey-men: right wing wackos or left wing terrorists, perhaps they will have funny sounding names.


Next, forces will be deployed outside their native geography.  We saw this in New Orleans with the Chicago Police, among others, rounding up civilian-owned firearms.  This can also be seen within states as out-of-town police are brought in for ‘crowd control’.  This will eliminate a natural barrier to the use of force – familiarity.


Next, the process will be subtle.  There will be no widespread rebellion or civil disturbance.  Rather we will see isolated flare-ups and abuse of power as the state crushes dissent with overwhelming force and makes up facts as they go along.  Sometimes these facts come out later (think Ruby Ridge).  Other times the facts never come out (think Waco).


Finally, as we have seen so vividly in recent times, both soldiers and police (is there really a distinction today?) will follow their orders.  That’s what they are trained to do.


Are you “dangerous or unruly”?


So as a declared American and, therefore, enemy of the state, I suppose I qualify as an “unruly or dangerous” individual.


Do you?  If so, I want to hear your comments.




Another State reaffirms its rights under the 10th amendment

February 23, 2009

See it HERE


Tennessee now joins New Hampshire, Montana and Oklahoma in asserting its 10th amendment rights (emphasis mine):




A RESOLUTION to affirm Tennessee’s sovereignty under the

Tenth Amendment to the Constitution of the

United States and to demand the federal

government halt its practice of assuming powers

and of imposing mandates upon the states for

purposes not enumerated by the Constitution of

the United States.


WHEREAS, the Tenth Amendment to the Constitution of the United States reads as

follows: “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people”; and WHEREAS, the Tenth Amendment defines the total scope of federal power as being that specifically granted by the Constitution of the United States and no more; and WHEREAS, the scope of power defined by the Tenth Amendment means that the federal government was created by the states specifically to be an agent of the states; and WHEREAS, today, in 2009, the states are demonstrably treated as agents of the federal government; and WHEREAS, many powers assumed by the federal  government and federal mandates are directly in violation of the Tenth Amendment to the Constitution of the United States; and WHEREAS, the United States Supreme Court has ruled in New York v. United States, 112 S. Ct. 2408 (1992), that Congress may not simply commandeer the legislative and regulatory processes of the states; and WHEREAS, a number of proposals from previous administrations and some now pending from the present administration and from Congress may further violate the Constitution of the United States; now, therefore,




CONCURRING, that we hereby affirm Tennessee’s sovereignty under the Tenth Amendment to the Constitution of the United States over all powers not otherwise enumerated and granted to the federal government by the Constitution of the United States. We also demand the federal government to halt and reverse its practice of assuming powers and of imposing mandates upon the states for purposes not enumerated by the Constitution of the United States.


BE IT FURTHER RESOLVED, that a committee of conference and correspondence be appointed by the Speaker of the House and of the Senate, which shall have as its charge to communicate the preceding resolution to the legislatures of the several states, to assure them that this State continues in the same esteem of their friendship and to call for a joint working group between the states to enumerate the abuses of authority by the federal government and to seek repeal of the assumption of powers and the imposed mandates.


BE IT FURTHER RESOLVED, that a certified copy of this resolution be transmitted to

the President of the United States, the President of the United States Senate, the Speaker and the Clerk of the United States House of Representatives, and to each member of Tennessee’s Congressional delegation.

Civil Disobedience and State Propaganda

February 23, 2009

This British news article  is worth deconstructing, as it highlights the nonsense and misinformation so common in the Western media.  It also serves as a warning for what may well be coming to the United States.


Britain Faces Summer of Rage – Police


Superintendent David Hartshorn, who heads the Metropolitan police’s public order branch, told the Guardian that middle-class individuals who would never have considered joining demonstrations may now seek to vent their anger through protests this year.


Who can blame them?  Taxed to the brink, lacking the bail-out compensation of failed financial corporations that dominate the UK economy, and devoid of any true representation in parliament, it’s a miracle there hasn’t already been widespread civil unrest in all Western nations.


He said that banks, particularly those that still pay large bonuses despite receiving billions in taxpayer money, had become “viable targets”. So too had the headquarters of multinational companies and other financial institutions in the City which are being blamed for the financial crisis.


Again, it’s only a matter of time before banks and financial firms become targets for demonstrations.  The only surprise is that it hasn’t happened already.


Here’s where it gets interesting:

Hartshorn, who receives regular intelligence briefings on potential causes of civil unrest, said the mood at some demonstrations had changed recently, with activists increasingly “intent on coming on to the streets to create public disorder”.

Intelligence briefings on civil unrest?  Sounds like the UK has a more robust domestic intelligence operation than a Western state would like to admit.  For anyone who thinks this is unique to the UK, think again.

Intelligence reports suggest that “known activists” are also returning to the streets, and police claim they will foment unrest.

And here we have it: “known activists”.  Whose name is on the United States’ list?  Yours?  How would you know?  Are these lists made public?  How do domestic intelligence agencies gather such data and determine who is a ‘known activist’ or ‘enemy of the state’?

His comments are likely to be met with disappointment by protest groups, who in recent weeks have complained that police are adopting a more confrontational approach at demonstrations. Officers have been accused of exaggerating the threat posed by activists to justify the use of resources spent on them.

Police were said to have been heavy-handed at Greek solidarity marches in London in December and, last month, at protests against Israel’s invasion of Gaza. In August 1,000 officers, helicopters and riot horses were drafted to Kent from 26 UK police forces to oversee the climate camp demonstration against the Kingsnorth power station. The massive operation to monitor the protesters cost £5.9m and resulted in 100 arrests. But in December the government was forced to apologise to parliament after the Guardian revealed that its claims that 70 officers had been hurt in violent clashes were wrong.

First, understand that the state has and will plant agents amidst the protestors to stir up violence and riots.  There is ample precedent for this – it is a known strategy of the state.  Next, police will react to signs of violence with the full force and power of the state.  In the example above, it included 1,000 ‘officers’ and helicopters.  Finally, the state will lie about what started the violence, how they reacted to it and how many injuries or casualties the agents of the state suffered. 

“Potentially there will be more industrial actions … History shows that some of those disputes – Wapping, the miners’ strike – have caused great tensions in the community and the police have had difficult times policing and maintaining law and order.”

Ah, the old stand-by: ‘maintaining law and order’.  Understand that when you’ve finally had enough and decide it is time to make your voice heard through demonstration then you too will be an enemy of the state, standing in the way of ‘law and order’.

Both “extreme rightwing and extreme leftwing” elements are looking to “use the fact that people are out of jobs” to galvanise support, he said.

This is priceless.  So in the middle we have the state.  Any opposition to the state is then labeled as ‘extreme rightwing’ or ‘extreme leftwing’.  I suppose ‘moderates’ simply show up at parliament (or congress) and make speeches.

A particularly worrying development was the re-emergence of individuals involved in the violent fascist organisation..

Is this serious?  ‘Violent fascist organization’??  The only violent, fascist organization that exists in either the UK or the USA is the state.  The state at this point is unabashedly fascist – look up the definition, there are many free resources on-line.  The corporatist state is bleeding the public coffers (and, by definition, private income) to support large corporations that whose business models have failed.  The corporatist state is sacrificing the future of private savings by attempting to inflate the fiat currency.  The corporatist state has, and will use, its monopoly on violence to tax income, property and privately held wealth, jail resistors at gun-point and, as we have seen, with its armed agents and helicopter, crush any dissent. 

And so we have yet another gem from the mainstream media which, even when attempting some divergence from pure state propaganda, is hopelessly stuck within the dominant, corporatist state paradigm. 

It is only a matter of time before the demonstrations begin in the United States.  When the unemployed realize there are no new jobs to be had, when unemployment benefits run out, when the employed grow weary of seeing their tax dollars transferred to corporations and when laid-off, middle aged, white-collar workers find the only jobs ‘created’ by Spendulous are infrastructure construction jobs, Americans will have finally had enough.  They will then reclaim the title of ‘citizen’ and shrug-off the statist label of ‘tax-payer’.

But be forewarned – the state will use it’s virtual monopoly on force to crush dissent.  It will lie.  It will plant moles in the crowds to incite violence.  DO NOT BELIEVE WHAT YOU READ IN THE MAINSTREAM MEDIA ONCE THE PROTESTS BEGIN.  Use your head.  And, if you attend a demonstration, do not trust anyone you don’t know, be prepared for the eventuality of state-initiated violence and be sure someone you trust knows where you are in the event you are arrested or otherwise detained.  Finally, think twice before condemning protestors.  While it is true many misinformed, stoned, wannabe hippies attend protests, not all who attend protests are misinformed, stoned, wannabe hippies.  Many are simply Americans – outraged at the collapse of our representative Republic, our Constitution and the institutions of implied consent.


All of it will collapse

February 22, 2009

This is perhaps the best and most insightful article I have read on the financial crisis and its economic, social and political repercussions.

Economic Fascism and the Bailout Economy, by Gary North, via the Ludwig von Mises Institute.  If you aren’t a regular reader of the Mises website, you should be.

Anyone who does not understand the magnitude of what is taking place is an economic ignoramus.

The American political system has been soft-core fascist for almost a century. Liberals love to call conservatives fascists. The problem is, the liberals are right. Of course, well-informed conservatives like to call liberals fascists, and they are correct, too. Everyone who believes in the efficiency of the so-called government-business alliance is a fascist.

The fascist state has always been an attempt to control private industry by means of inflation, taxation, and regulation.

Do I see this as the end of freedom? No, I see it is the end of the fascist state. The monstrosity came close to going belly-up last October. It is on its last, tottering legs. It has lost the respect of the public.

We are seeing the bankruptcy of every Western government that has made too many big promises to too many voters regarding free healthcare and guaranteed retirement. All of it will collapse. The tatters of the promises will point to the tatters of those who made the promises — politicians — and the tatters of the system that was supposedly going to guarantee delivery of the promises.

The academics still believe in the healing power of the state. The voters still believe this, too. But voters are catching on more rapidly than the academics that the state is running out of wiggle room. Millions of voters have figured out that they are going to get stiffed. They don’t know what to do about it, but at least they understand that they really are going to get stiffed.