Rebane's Ruminations

Decline and Fall of Europe and the West

George Rebane

Progressive organs around the world are starting to hyper-palpitate about the EU economy, sovereign debts, and unexpected violence in the streets.  The Economist and Time are in general agreement that Europe is “about to blow”.  And it’s all due to the planned and announced budget cuts because their governments are rapidly running out of other people’s money.  The continent’s social programs have finally started taking down entire nations, and there is no end in sight to the spreading economic blight.

The post-Wall economic boom of 1991-2008 has come to an end.  Eurozone and socialism was supposed to “bring about economic stability and remove traditional barriers to growth such as tariffs and regulations.”  Don’t get excited that these mavens have finally discovered that tariffs and regulations are frictions to business.  No, no – they only apply to trans-national barriers that must be removed, before growth can resume.

You see, the entire problem is that the EU has become a “selfish union in which flailing economies feed rising nationalism, angst over immigration, and simmering distrust between rich and less affluent countries.”  And again, all this because the continent’s political union is yet incomplete.

The 22aug11 issue of Time points out that, just like people, entire countries go for the gold ring in their own inimitable ways determined by their culture and resources – no one holds back.  And when a country provides economic freedom to its people, guess what, some people tend to do better than others.  All of these factors are raining down on the European policy naifs, they never thought such inequalities could come about.  Their models of socialist altruism prohibited these realities.

Our Painfully Uninformed Young People (Addended)

George Rebane

[This is the corrected form of my Union column for August.  In the submitted form I mistakenly assigned PM Cameron to the Labor Party.  However, due to a glitch, it did not appear today but will instead publish next Saturday 20aug11 here, hopefully in the corrected version as below.  Thanks again to readers for pointing out my blooper.  In the post below I have addended comments about a related piece on the “skills gap” that appeared in the 11aug11 WSJ.]

There’s a burr under my blanket about how our young people are short-changed by establishment schools.  But before getting to that irritation, we need to frame the issue.

Across the world we have two massive social storms merging into an historical typhoon of unknown proportions.  Expanding economic crises due to massive overspending by European Union governments and the United States is colliding with an un(der)employed youth demographic already cooked into developed western societies.  The result is growing civil unrest.

Without adding in the so-called Arab Spring uprisings across the middle east and Africa, Europe is showing the strains of belated austerity measures as the growing “number of protests against public-spending cuts have turned violent.”  They began last year in Greece and have haphazardly spread across southern Europe, and now we have witnessed days of wanton rioting and looting in the UK.

There Tory Prime Minister Cameron has attempted to sweep it all under the “pure criminality” rug, but when such criminality quickly spread from London to other big cities like Birmingham, Bristol, and Liverpool, then wiser heads know that there is something more than spontaneous hooliganism going on.

We in the US are not immune from this social disease.  Here no progressive politician would consider sponsoring a serious cut in the only major entitlements that might slow our fiscal freefall.  But cuts will come, they have to.  And then we will see the thread count of our civilization’s ‘gossamer veil’.  It has ripped before.

So what have we been doing with our young people, those whom we expect to graduate from high school and go on to college or into the job market?  Other than giving most of them a second rate education, we send a large fraction of our youth into the job market without even a high school diploma.

Ruminations - 11aug2011

George Rebane

- The Left’s American Dream movement
- UK riots have an unmentionable cause
- California’s popular vote law

Led by Van Jones, our favorite self-declared communist and former Obama staffer, the American Dream Movement “announced the Contract for the American Dream, a new agenda for economic recovery supported by a grassroots movement that progressive leaders say will rival the Tea Party in size and impact.” (more here)  Those progressives can’t get their message straight – one minute they're decrying the Tea Parties as yesterday’s newspaper, and the next minute they’re trying to get something similar going to match its “size and impact”.  This is their second attempt at flattering the TPs; the first was something called the ‘Coffee Club’ or clatch or whatever that was launched into oblivion a couple of years ago.  In any case, one man's dream is another's nightmare.

British social scientists are quietly starting to ascribe the cause of the ongoing riots in the UK to multi-culturalism (gasp!).  It seems that there is insufficient reason to suspect deprivation of this sort or that since Great Britain is one of the most socially generous and culture-compliant countries in the world.  The rioters have been mostly black Africans who have attacked the shops and businesses of other ethnic groups in UK’s major cities.  (The police shot one of their gang members.)  In response, the target ethnics – Pakistanis, Sikhs, Turks, … - have coagulated into defensive ethno-centric vigilante platoons since police protection is sparse and late.  Prime Minister Cameron and other European leaders have already gone public with their assessments of how mulikulti affects their respective countries.  Tough reporting job for the leftwing press.

California quietly took another large step toward Progressive Amerika with Governor Moonbeam’s signing of the National Popular Vote Law.  This law will assign all of California’s 55 electoral votes to the presidential candidate who wins the nation’s popular vote, regardless of the candidate that won in California.  (more here)  It is another step away from the Founders’ republicanism and toward popular democracy, an inherently unstable and beguiling form of governance that leads to autocracy.  Unfortunately that is the progressive agenda (aka UN's Agenda21) in full swing – eight other states have already adopted similar legislation, and now it's coming to a state near you.  We can already hear the strains of ‘The Internationale’ in the distance.

Bernanke’s 'non-Keynesian' QE3 (updated)

George Rebane

This is just a little stake in the ground so I can keep the audacious prognostication momentum going on RR (and put myself at your mercy if I’m wrong).  The Fed under The Bernank has put out the message that there will be no QE3 as the previous two quantitative easings (aka printing faith-based money) have been known.  Instead, the chairman today set a new record for clarity in stating that current interest rates have been chiseled into a two-year stone.  And everyone is talking about that.

Dear readers, I’m asking you to look at the other hand, the one below the table.  The to-be-anointed Divided Disciples are going to crash and burn, and this holiday season will have Santa Claus putting a lot of lumps of coal into stockings hung with care.  Some time before the primary season ends next year, the Keynesians in the administration are going to demand more of that ol' stimulation.  But the kind that was misspent in the government directed projects of QE1 and QE2 won’t do any more.  Both the Democrats and the Fed would then look as if the ‘do again, expect different’ insanity definition was written for them.

As a change, Bernanke will try to pump fresh cash into the other end of the economy – put more liquidity in the hands of people who actually know how to create jobs.  It still fits the Keynesian mold, but from a distance doesn’t look leftwing Keynesian.  And he can do that by quietly starting to buy securities (stocks, funds, hedge products, real estate, …) to ‘balance out’ the Fed’s asset accounts.

This QE3 will be a direct infusion of newly printed cash into the private sector that bypasses the dead hand of the US Treasury under Heckuva Job Geithner.  Now I’m not sure how well spoon feeding the economy from this end will work.  But sure as hell, the Fed's pouring liquidity through the enema tube has not restored regularity to the beast.

[update]  Sumbich, that was easier than I thought.  Today's WSJ came out with a piece  - 'More Fed Bond Buys HInge on Inflation, Indicators' - that blithely had the following -

Four words in the central bank's announcement Tuesday—the acknowledgment that policy makers discussed a "range of policy tools"—indicated to investors eager for a government fix to the economy that the Fed was willing to take further steps. More than anything, markets are expecting a new, third round of bond purchases known as quantitative easing, or QE3. (emphasis mine)

Nowhere was it mentioned (admitted?) that the Bernank had told Congress that no QE3 was required or planned.  So now the only question remains as for what kinds of assets the Fed is willing to print new money.  The market's continued nosedive today provides some mighty attractive buys; the Fed may even make money on some of that stuff and be able to take cash out of the system.  Now that's a novel thought.

Time at the Tea Party (updated 8aug2011)

When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work, because somebody else is going to get what they work for, that is the beginning of the end of any nation. – Peter/Paul Principle (expanded version)

George Rebane

Time, America’s premier leftwing news magazine, is going all out to cast the conservatives and their ideas as the debt debacle devils in the recent and ongoing debate.  Its 15aug11 issue features articles on the country’s fiscal woes and ‘How the Tea Party Hijacked America’.  The latter is actually a back-handed compliment to the enormous impact that the tea party movement has had and promises to have on our politics.  Michael Crowley writes the featured piece that firmly establishes that the tea party movement is definitely not in Republican control, but instead is a major burr under its blanket.  His leading tagline and takeaway is that the tea party is a “populist movement underestimated by both parties has shown that it’s here to stay.”

This assessment goes a long way to explain away the almost hysterical flood of articles from the progressives that the tea party movement is a rapidly waning force on the country’s political landscape, and that it may self-destruct even before the 2012 election.  This line is picked up in the hinterlands’ blogosphere by the mindless followers of the lamestream.  Meanwhile the founder/leaders of the various tea party factions, like Mark Meckler of the Tea Party Patriots, are getting more and more national air time, as incredulous hosts of TV commentary programs embarrass themselves trying to entice out some slip-of-the-tongue that might connect the tea parties to social issues or the Republican party (see also the comment streams on RR).  Crowley goes on –

In January, Senate majority leader Harry Reid predicted that the Tea Party would soon "disappear." Now, having pushed Reid's party into a deal few people would have thought possible a few months ago--trillions in spending cuts, possibly with no new taxes--the Tea Party is more convinced than ever that its facts and its tactics are the right ones. And its influence is hardly waning--something Reid is the first to admit. The Tea Party's sway in Congress, Reid lamented as the Senate approved the debt deal on Aug. 2, "has been very, very disconcerting ... it stopped us from arriving at a conclusion much earlier."

Barack Obama has long promised a post-partisan environment in the capital. But he never imagined that a minority of Americans would come to play such an outsize role in the public conversation. Polls may show that Americans overwhelmingly want more compromise in Washington, but the Tea Party's leaders--and the roughly 25% of Americans who consider themselves Tea Party supporters--are primed for more confrontation. The debt fight, believe it or not, is probably just the beginning.

What continues unexamined is the basis for the tea parties being labeled as “rightwing” or “far right” organizations. As confirmed on these pages, those descriptors are supposed to be true just because the left repeats them with increasing frequency, while themselves claiming to be “in the middle”. Crowley’s article sheds no light here.

The Christmas Yet to Come

George Rebane

[This is the transcript of my regular bi-weekly KVMR-FM 89.5 commentary aired on 5 August 2011.  It was recorded on the morning of 4 August 2011 before the markets took their 6% historic swoon.  As has been reported for some considerable time on RR, this market reaction is expected and reflects how the world assesses governments firmly on the socialist path to economic destruction, which always precedes worse things.  As we head into Depression2, the 21apr34 Chicago Tribune cartoon is as prescient today as it was when first published during Depression1.]

If we believe the media pundits, the country has let out a collective sigh of relief that America has dodged the fiscal bullet.  We don’t have to worry about defaulting on our debts.  Entitlements and other transfer payments will be paid, and we can now merrily skip down the middle of the road into a less stressful future, having demonstrated that bi-partisanship is again alive and well.

Nothing could be further from the truth, which in the coming year will become a rarer commodity than it is today.  The compromise debt limit bill that the President signed into law this week is an extremely clever victory for the progressive wing of the Democrats, their cries of ‘Oh no, don’t throw me into the briar patch!’ notwithstanding.

After all the hullabaloo of the last couple of months, the country’s liberals got exactly what they wanted.  But to make the bamboozle work, they can’t let the cat out of the bag until after the election.  Well, maybe just before the election.

So how do we know that the country is still firmly headed for the ‘fundamental transformation’ that President Obama has promised us.  For starters, we get to keep borrowing at essentially the same breakneck rate; our national debt will increase by more than 50% to over $23T in ten years.  The promised $917B spending cuts are a fantasy scheduled to begin in the foggy future under a Congress that is not beholden to anything done today.  So the country’s profligate behavior has not changed one iota.

California Now Federalized (updated)

George Rebane

For the last years I have been telling RR readers that California was heading toward becoming a ward of the federal government – in short, federalized (e.g. here).  As with many major and momentous changes, I believe this was apparent to anyone who had a facility with arithmetic, and understood the basics of how wealth is produced.  It turns out that such skills are at a premium, hence we bloggers do provide some modicum of early warning and added value to the received wisdom from the mainstream (and lamestream) media.

One of these major media outlets in California is, of course, the LA Times.  And the worthies down there are finally starting to put things together.  In their 4aug11 issue they report -

The dirty little secret is that California's current state budget is not $85.9 billion, the size of the much-debated, deficit-plagued general fund. You've got to add in the special funds ($34.2 billion) — much of them fed by fees dedicated for specific purposes — plus bond money ($9.4 billion). That totals $129.5 billion, but it still ignores federal dollars.

The real state budget includes an additional $79.2 billion in federal largesse, representing 38% of total state spending. This brings the grand total to $208.7 billion.

So the state of California is getting a nearly $209-billion spending program while putting up less than $130 billion itself.

So that is how far things have progressed.  The state’s socialists still crow in satisfaction that California sends more dollars to Washington than we get back.  While that is true, we must remember that those dollars are sent there under extreme duress (aka at gunpoint).

And what really seals our fate is that every one of those federal dollars comes back with an ‘owner’s manual’ telling us exactly how it should be disposed of and/or spent.  The only leeway that the feds have left for us in Sacramento is the ability to continue hurting ourselves in every imaginable way possible.  And this our legislature and governor are doing with a relish as they proudly demonstrate California’s “leadership” in how a state can mismanage its affairs.  Soon Washington will even take that away from us and assume our comprehensive mismanagement from across the country.

Please stay tuned.  (H/T to RR reader for the link.)

[update] A reader just emailed me the following story in the 3aug11 City Journal on the federally funded California high speed rail boondoggle.  Such screw-ups in policy and execution continue bathing California, and this is just one of many examples illustrating the points made above of how two levels of government collide in costly incompetence.

And reader georgef (see his comment below) emails that -

... this is the "plain language" version of the new GASB-35 (Download GASB-35 Plain Language 7-28-11 Pension Accounting and Financial Reporting) standard.  The previous drafts have been circulated for years; you can see the compromises necessary to get this result.

The discount rate topic is probably beyond the average reader but it is the essence of this level analysis.  The actual upper limit of a pension cannot be predicted due to spiking, use of unused vacation, and sick time which boost the last year of a retroactive calculation.

The triggering event will be the required disclosure of GASB-35 amounts about the same time as the federal financing is reduced.  The ability to borrow will be very limited.

That this California debt can only be handled by the feds - either by hopeless lending or destroying the dollar - should give some pause to those readers who consider it hyperbolic that California is already federalized.

We Are the Real Terrorists

George Rebane

Truthout.org has published a major article ‘Breivik's Fundamentalist War on Politics, and Ours’ which is a progressive manifesto, and itself a declaration of war on conservatives and their politics.  Author Henry Giroux (one of truthout’s “news analysts”) forges every connection imaginable between Breivik, the Norwegian mass murderer, and anybody to the right of Hugo Chavez.

There is no doubt in the minds of truthout.org subscribers (this 501c3 solicits funds every month) that the greatest danger to America comes from “fundamentalists”, which is the labeled can into which all people like me (you?) are thrown.  Coming from leftwing sources like the White House, and now these people, the "terrorist" label is starting to sound like a drumbeat.

Missing from the fundamentalist toolbox is the necessity for self-reflection, thinking critically about the inevitable limitations of one's arguments, or being morally accountable to the social costs of harboring racist ideologies and pushing policies that serve to deepen racist exclusions, mobilize fear, and legitimate a growing government apparatus of punishment and imprisonment.  What connects the moral bankruptcy of right-wing Republicans who embrace violent imagery in order to mobilize their followers with the mindset of extremists like Breivik is that they share a deep romanticization of violence that is valorized by old and new fundamentalisms, whose endpoint is a death-dealing blow to the welfare state, young people, immigrants, Muslims, and others deemed dangerous and, so, "disposable."

After reading Giroux’s piece, a simple perusal of RR comment streams quickly reveals that our leftwing compatriots here are exactly of a piece with the worldview and philosophy of this leftist ideologue.  The opinions expressed on truthout.org are not to be dismissed, since their stable of contributing authors includes many (most?) of America's progressive luminaries.  This is their home stomping ground, and their readers are collectivist intellects who can master the sometimes thick porridge that the site pours out.

A remarkable telltale of their firm position on the political spectrum is the fairly frequent pace of publications that take even the Chief Community Organizer to task – maybe he’s not that bad after all.  So if you do happen to be a little to the right of Hugo, pour yourself a stiff one, send the young’uns out of the room, and wade in.

The Debt Deal - Nothing Ventured, Nothing Gained (updated 2aug2011)

George Rebane

Now you’re free to believe that last night’s debt limit deal between the Repubs, Dems, and President is a solution to any of the ills our country faces.  But you would be wrong, because nothing has changed except another little shot of morphine to ease our cancer’s pain.

The deal, which may not even pass Congress, will continue to increase our national debt, ignore meaningful deficit reduction, and enlarge government over the next ten years.  The deal also sets up the Dubious Disciples – a committee of twelve, evenly split among Dems and Repubs - to manage kicking the can some more when it meets later this year.  The piddling cuts will not mount to a hill of beans in the grand scheme, and both sides will expect to get more of what they want from the next baked in crisis – Repubs real spending cuts, Dems real tax increases.

The credit rating arguments have been specious.  This deal will not affect them one iota, and will even affect less the lenders’ propensity to buy Treasuries.  Those bonds will sell or not based on the relative risk that the world’s borrowers present.  Uncle Sam, believe it or not, still seems to be sitting on top of that dung heap.

So this little exercise was all done for the politics of 2012.  And it will be a politics with a gaping, smoking hole where America’s ideological middle used to be.  Each side will accuse the other of stretching their ideological boundary away from the center, and each side will be right.  The progressives caught the conservatives napping in 2008 – Bush2 had damaged the right much more than anyone thought.  And then when all was set for the socialist road to utopia, up rose the people in the tea party movement and made history in 2010.

But our real destination has not changed since the country decided that it could borrow, tax, spend, and regulate our way into a prosperous and secure 21st century.  To change that destination will require a real crisis.

[2aug2011 update]  Congress has passed the compromise bill to raise the debt limit, and a promise to cut a tad of spending way out there in Neverland.  The tea parties are not happy about anything save introducing the idea that we should at least talk about spending cuts when we promise to increase borrowing.  Without going out on too much of a limb, I predict that the spending cuts from this legislation will not amount to one tenth of the projected (by whatever bamboozle you care to quote) $2.4T.

Perhaps Muslim-Themed Ethics Training Next (Updated)

George Rebane

This from truthout.com, my favorite website for socialist cum communist news and commentary.

Air Force Pulls Christian-Themed Ethics Training for Nuclear Missile Officers After Publication of Truthout Report
Jason Leopold, Truthout: "The Air Force, in response to a report published by Truthout earlier this week, has pulled a Christian-themed training session that used a quote from an ex-Nazi SS officer and numerous passages from the New and Old Testament to teach missile officers about the morals and ethics of launching nuclear weapons... David Smith, chief of public affairs of Air Education and Training Command at Randolph Air Force Base in Texas... said the ethics training has been in place for '20-plus years' and the decision to remove it was made on Wednesday after Truthout's report was published."
Read the Article

It is always entertaining to see the attempt to develop and ground our morals and ethics within an oblivion-based theology like secular humanism.  They never answer why should humans not behave and develop exactly within the rules of, and in harmony with ‘nature’?  Everything else does.

Why not then embrace Darwinian ethics to the fullest.  If not, we know there is at least one active religion that practices Darwinian theological evolution for those still insisting that man is transcendent.  Would it make us more comfortable to know that the fingers on our nuclear trigger have the ethical training in which Islam's selfless martyrs are immersed?  Maybe we'll let Iran teach us what that is like.

[update]  A little more perspective never hurts.  Inroads of Islam in American thought in this YouTube video.