Obama and Nobel Peace Prize

Like a lot of people I can remember when the Nobel Peace Prize actually meant something. When people like Nelson Mandela, Martin Luther King, Lech Walesa amd Andrei Sakharov won it. These guys were real heroes who stood up to tyranny and evil and suffered terribly for it.

Today the Nobel Peace Price means absolutely nothing, a politician Barrack Obama has won it for making campaign promises. Mandela, Walesa and Sakharov faced prison and worse for standing up for their beliefs. King was murdered for his beliefs. All Obama risks is nasty jokes from Rush Limbaugh.

Indeed the emptiness of the modern Noble Prize is exemplified by the fact that the Obama administration is confused and troubled by the award. They admit freely that they aren’t worthy of it and their response seems to admit that they don’t want it. What this means is that the Nobel Prize has become a very bad joke.

Now Barrack Obama’s aims are certainly noble but he hasn’t achieved any of them. Indeed Obama’s political program is vague and unrealistic like that of any leader in his first term. He lays down a series of vague but noble ideals and sees if he can achieve some of them. Like all good politicians he puts out a couple of unrealistic big ideas knowing that these will be forgotten if they don’t become reality but will remembered for centuries if they are achieved.

Giving Obama the Nobel Prize for making a bunch of pedestrian speeches is insulting. It’s a betrayal of the ideals behind the Nobel Prize and an insult to Obama himself. As I pointed out earlier the Obama administration and Obama himself don’t seem to want the honor.

This makes me wonder who hands out the Noble Prize? Junior officers at some Norwegian bank or some does committee of the Norwegian parliament award it after a debate on sidewalk improvements in Oslo? It sure sounds like it.

What I wonder will happen if President Obama refuses this ridiculous honor? and I hope he does.

There are others who certainly deserve the Noble Prize for making peace. One late American President who definitely deserved the honor and really worked for Peace and Freedom was Ronald Reagan. But he was a right wing Republican so he won’t get it. Even though he deserved it. Maybe he’ll get it on default if Obama turns it down. I wouldn’t hold my breath hopefully this ludicrous award will expose the Nobel Peace as the very bad joke it really is. One thing I do know Alfred Nobel the great man who created this prize is rolling over in his grave.

The Choice the Free Market or Brute Force

Socialists like Michael Moore and other critics of capitalism just don't get it. There is only one alternative to the free market that of brute force. If you don't want to buy, sell and trade for the goods and services you need you have only two recourses. You can produce everything you need yourself which would only be possible for a Wizzard like Harry Potter or you can resort to brute force.
Every attempt to create a utopia based upon sharing and kindness has ended the same way in the use of violence to take goods, services and money from others. Ayn Rand was right Robin Hood was nothing but a common bandit. He may have given to the poor but Robin Hood used violence to get what he gave to the poor.
The only way wealth can be distributed without the free market is at the point of a sword or a gun. No alternative has been found or will be found.
The only way wealth distribution without the free market would work would be in a society of perfect beings without greed or avarice. Since such beings don't exist the free market is the only moral economic system. Those who don't learn that lesson condemn themselves to an unending spiral of violence and destruction.

A Delusion of Modern Conservatism

The greatest failing of modern conservatism at least in economic terms has been the delusion that simply cutting the revenue stream to government (taxes) will reduce the size and scope of government.
 The result of the modern mania for tax cutting(which was started by conservatives but is now a firm part of the leftist agenda as the Obama Administration’s policies indicate) is that government keeps growing in power, size, complexity and influence even as its revenues steadily decline. This seemingly impossible feat is achieved through inflation which as Allen Greenspan pointed out many years ago is a means of seizure of wealth from the middle classes.
 The principle vehicle for the creation of this inflation is government debt the incredible growth in variety and complexity of the financial markets has given governments on all levels many more opportunities to borrow. There are the traditional bonds and similar instruments issued by governments, these are generally sold on international markets. The major reason the US federal government has been able to run up such a high deficit and issue so much debt in recent years is that China has been willing to buy so much debt often with cash generated by the sell of products to the US.
 There are now many other means by which governments can issue debt. A big one is to sell, lease or mortgage a government asset to private investors. All over the US hospitals, highways, bridges, government buildings and other facilities have been sold or leased to private investors. At the same time private companies have been retained to perform government services such as the collection of parking tickets. This of course represents an extension of credit to governments by private entities and a poorly understood one.
 An even more bothersome government practice is the extension of government credit to private individuals and companies. The federal mortgage giants Freddie Mac and Fannie Mae which are bankrupt, are financed through the issuing of mortgage backed securities overseas. More recently we saw Cash for Clunkers, which actually involved no cash, instead credit was extended to private individuals to buy cars.
 When government extends credit it creates money and dilutes the money supply creating inflation. The governments of the past created inflation and paid their bills with the printing press. Today’s governments pay their bills and create inflation by issuing credit. The credit is either directly through congress by direct or indirect payments to the public or by the issuing of credit to banks and other financial institutions by the Federal Reserve. 
The automatic increase of Social Security benefits based upon inflation also represents an extension of credit to the elderly. The government uses inflation as an excuse to increase the money supply which results in more inflation.
 A popular kind of credit is a tax credit either the earned income tax credit in reality a welfare payment to lower income people or a special credit such as the tax credit for buying a new house. Farm subsidies and tax breaks for farmers are another kind of tax credit. The earned income tax credit and tax refunds also represent a federal loan to local and state governments because a large portion of the money paid out will come back to those entities in the form of sales tax.
 More recently we have seen the direct payment of money mostly borrowed to business including the finance and automotive industries. The government is now in the business of protecting business executives from their own incompetence. The money extended to these businesses represents yet another massive extension of credit.
 The credit extension has created inflation, which the government goes out of its way to hide. As Peter Schiff points out the real rate of inflation is hard to determine because the Federal Reserve has been able to hide it through market manipulation. There are many indications that inflation has increased massively consumer prices have gone up considerably magazines which cost 50 cents apiece 25 years ago now cost five dollars each, an inflation rate of 100%. Gasoline which cost 75 cents a gallon twenty years ago costs nearly $3 a gallon. The official inflation rate the consumer price index as Peter Schiff has noted is a chicanery not related to the real cost of goods or services. 
 Wages and salaries are another example of the increase of inflation. Indeed salaries are often the best indication of the rate of inflation, because people won’t work unless they can support themselves at a job. In Denver, Colorado, Safeway is hiring strikebreakers to bag groceries in the possibility of a strike for $10 an hour. Many working class jobs including truck drivers now pay $40,000-$100,000 secretaries and clerical workers now earn between $15-20 an hour. Employers are paying these salaries because workers won’t work for less. 
 Another way the inflation rate is hidden is through interest rates. The official interest rate especially for mortgages is held artificially low at under 5%. The problem is that very few people pay this interest rate they pay a far higher one. The most common type of consumer credit, credit cards charge a rate of between 10 and 20% or more. So do some mortgage providers and companies that issue home equity loans. Alternative lenders such as pawn shops and payday loan companies charge an even higher rate at around 25%. So the real rate of inflation is actually much higher than the official rate.
 The banking industry uses many tricks to charge a higher rate for example credit scores which are largely artificial and not reflective of a individuals’ net worth or ability to pay off a loan. These can be used as an excuse to charge a higher interest rate. A typical scam is that a lender issues a person a loan interest line of credit to an individual because they have a good credit score but no means to pay it off. The lender is then able to jack up the interest rates because the person has not paid. Another are the fees added to loans and bank accounts which are really interest. 
An even more interesting method used by some banks is checking accounts these really represent an extension of credit based on an individuals’ salary. By giving a person a check book and the ability to set up payments in advance the bank, extends credit. The overdraft fees charged represent interest on the loan issued in anticipation of a direct deposit. Many people get into trouble by writing checks in anticipation of salaries and future income. Banks could easily avoid this situation by issuing low income people debit cards that only pay out what is in someone’s account in lieu of check books. They don’t because the overdraft fees and other charges are a profitable source of income. 
 The destruction of the currency through inflation has many negative effects one of which is the end of savings. Politicians, economists and bankers are constantly complaining that average people don’t save but instead spend all of their money on consumer goods. The average people are not as stupid as their self-proclaimed leaders think. They know that money decreases in value so money kept in savings will result in a net loss. The average person sensibly buys now while his or her buying power is higher.
 Encouraging inflation encourages spending which increases the government’s power. I might also add that encouraging spending generates sales taxes revenues which governments use to pay off the interest on their bonds.
 Particularly bothersome is the fact that the government is getting little or nothing back for much of this credit backed spending. In the 1950s at least, we got something back in the form of Interstate Highways. Today we get nothing back but more and more inflation. 
 At least in the old days government made an effort to pay its debts through taxes. Today there is no pretext or assumption that government will ever pay its bills, it just keeps on borrowing and borrowing. The result of all this borrowing will eventually be collapse because sooner or later the money will be completely worthless. One strong possibility is hyperinflation as happened in Argentina where the dollar’s value suddenly collapses. The crash of the Federal Reserve especially if its brought on by an audit or investigation of that institution would cause this. 
 My guess is that sooner or later the US government will have to declare bankruptcy that is announce it can no longer pay its debts. When that happens no one will extend Uncle Sam Credit and the spending spree will be over. The social and political effects of that event will be devastating but at least it will put us back on track to a sound economy. Particularly hard hit by these events will be leftists like Michael Moore when they realize that the all the money they believed was stolen by the evil robber barons of Wall Street never existed in the first place. 
 Conservatives have no one to blame but themselves for this looming catastrophe by not insisting on fiscal responsibility while glorying in tax cuts they have made it possible for government to spend its way into bankruptcy. A bankruptcy that will hurt everybody in the United States and many other countries.