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America’s 2 Colossal 21st Century Mistakes
Monday, 1/13/2020 09:01And today, we take up the other most bone-headed, society-destroying mistake of the 21st century.
We’re talking about money. When the money goes, everything goes. You can quote us on that.
In the panic of the crisis of ’08-’09, for example, Ben Bernanke, the Federal Reserve, Congress, leading economists, Republicans, Democrats – and almost everyone else – lost his mind.
Bernanke stood before Congress on Thursday, September 18, 2008, and told the clowns the most preposterous thing: “If we don’t do this,” he said, “we may not have an economy on Monday.” And nobody laughed.
With Bernanke’s urging and guidance, the feds had the “courage to act”…like morons. They went to the pumps…adding trillions of new money into the economy over the following ten years. And while, today, America’s money world seems in decent shape on the outside, on the inside it is rotting.
Stocks are at all-time highs, but only because of front-running by speculators and buy-backs by corporate insiders. Real, pre-tax earnings growth is falling.
Unemployment is near all-time lows, but only because people are forced to take low-paying “gigs” in the service economy. Real, “bread-winner” jobs continue to disappear.
GDP growth is still positive, but only because the Fed lends money below the rate of consumer price inflation. Worldwide, central banks lowered rates some 90 times last year. And now – using its Repo Madness program – the Fed is pumping even faster than it did during the crisis of ’08-’09.
Meanwhile, the US government is headed for the biggest default in world history. For 20 years it has added debt twice as fast as GDP.
How long can you keep that up? That’s what we’re going to find out. Because, now, with 11,000 baby boomers retiring every day…and the armed wing of the Deep State insisting on more and more money…there’s no way to stop it.
And here again, you can blame traditional conservatives.
Typically, Liberals (in the American sense of the word) believe in Big Government. They want it to cure the world’s ills – as they see them – by force. They may or may not trust the free market to create wealth; but they damned sure don’t want it to decide where the money goes. They’ll do that themselves.
They’ll tell you where you can smoke, too. And what you can put in your body. And what you have to do with your trash…and what kind of deal you can make with an employee. And so on…and so on…And the cost? Don’t worry about it. “There’s always money available,” as Elizabeth Warren remarked recently.
Traditionally, you could count on conservatives to say “no.” They knew there were limits. They were suspicious of the Liberals’ motives (what they were really after was power)…and skeptical about their programs (war on poverty…war on drugs…war on terror…taxes…regulations – none of them would work, conservatives grumbled). They opposed budget-busting foreign wars…and domestic boondoggles alike.
But in a world of free money, conservatism no longer makes sense. Why worry about wasting money…when you can print more? Why worry about balancing the budget when deficits can be financed for practically nothing, apparently forever? And besides, doesn’t government spending stimulate the economy?
Over a nearly 50-year period since the fake money was introduced in 1971, the old conservatives disappeared, died, or became new conservatives – who joined the Liberals as supporters of Big, World-Improving Government.
So, in 2008, when the financial crisis hit hard, and the feds turned on the stimulus taps, who was there to stop them?
Nobody.