Britannia Radio

The Daily Reckoning U.S. Edition

Home . Archives . Unsubscribe

The Daily Reckoning | Monday, October 10, 2011 Occupy Wall Street: Real anger under dangerous misguidance, A frightening look at militarism as a mainstay of government spending, Plus, Bill Bonner on jobs, gold and the growing unpopularity of “stuff”... ------------------------------------------------------- Urgent Message From Addison Wiggin I had no clue what Addison was doing in the office SO early Friday morning. Especially with a camera crew. You see, Addison doesn’t often appear on camera. I knew something big must have been cooking. And now that I’ve just seen the footage, I finally get the reason for his urgent message. Check out this rare video warning that he’s recorded for you... right here... Scenes from a Hostile Occupation What Wall Street Protesters Want...However Misguided it May Be Joel Bowman Reporting from Buenos Aires, Argentina... “What do we want?” “Whatever they have!” “And when do we want it?” “NOW!” Occupy Wall Street. Now here’s a movement any jilted dolt can get behind. An impromptu grievance swap meet for the fleeced and the scammed; it’s practically designed to attract them. Got a problem? Want something for free? Think “profit” is a dirty word? Well, get on down to Wall Street and tell the occupiers! They’ll paint your concern on a placard and march gruffly up and down the pavement. They’ll beat the drums. They’ll sing the chants...and they’ll lay the blame squarely at the feet of exactly the wrong people. Then, after demanding more of exactly what is not needed (rules, regulation, state intervention, central planning and other holier-than-thou government meddling), they’ll kick back in the newly and oddly named Liberty Square, soundly content in the knowledge that they did something...even if it was precisely the wrong thing. People are protesting, “occupying,” cities from the Atlantic to the Pacific Ocean today, Columbus Day. Good for them. The protesters don’t necessarily know what they want, of course...they just know they don’t want what they have. Instead, they want some of somebody else’s...just like everybody else does. And they want the hired gun of the state to seize and deliver it for them...just like everybody else does. One thing these folk do know is that, somewhere along the way, they were dealt a hand from the bottom of the deck. They got ripped off. And so, quite understandably, they’re angry, persistent and dedicated to the cause. Their wages are stagnant or falling. Their lifestyle is gradually coming into line with their dwindling budget. Many of “the other 99%,” as they call themselves, don’t even have a job to otherwise fill their day. For them, a protest is as good as a walk in the park. The occupiers know they’ve been stiffed. And it’s not hard to see why. Banksters get big bailouts...and big bonuses to boot. Too-Big-To- Fail institutions get thrown taxpayer-funded lifelines...while their reckless CEOs get golden parachutes. This is a terrible mess, no doubt about it. The money the government stole from the occupiers has been unfairly distributed (mostly to the top, politically well- connected 1%). But instead of calling out the thief, they’re lining up the beneficiaries. Corporate America cashed checks against the occupiers’ stolen property. This much is true. But half of all Americans are net recipients of government welfare. Apparently nobody has a problem accepting stolen goods...they just want to make sure they get their “fair share” of the loot. So what’s their solution to a “fairer” distribution? More for everybody! Free education...universal healthcare...free anything that’s big enough to slap a “basic human right” tag on. More state, in other words. More theft. More guns. Is that what we really want? The crowd certainly seems to think so. And the crowd is getting louder. Beware. As Stefan Molyneux of Freedomain Radio succinctly puts it, “If the state is the solution, and the state has more power [than] it’s ever had before in its life, then why are things getting worse?” No. More state is not the answer. It never is. And those advocating it are to be treated with, at best, cautious suspicion. Fellow Reckoners are urged to stay back and watch the circus from a safe distance. They are advised only to take note that the mob grows louder by the day...and to be mindful of the distance between their own property and the advancing front of the picket line. “What do we want?” “Whatever they have!” “And when do we want it?” “NOW!” Of course, co-opting the anger of downtrodden individuals — however misguided they may be — is a specialty of the state. Already politicians have begun flocking to the scene of discontent, each promising their own cure for what ails...in exchange, no doubt, for voter sympathy and support. These people are cogs in the machine, thieves in the night. They are part of an experiment that has resulted in the largest military build-up the world has ever seen...the deepest debt that has ever been tallied...the largest imperial power ever known to man. Isn’t it time for a new experiment? One that doesn’t involve the redistribution of stolen goods? One that doesn’t rely on coercion, on paid-for privileges for one group at the expense of another, on what Mr. Molyneux correctly calls the “bribe-ocracy” of the state? A new experiment is coming, Fellow Reckoner. In fact, in some places around the world, it’s already begun. Stay tuned... In the meantime, we return today with Part II of Llewellyn H. Rockwell Jr.’s thoughts on “The Eight Marks of Fascist Policy.” Please enjoy... It’s Too Late to “Save America” — Here’s Why That’s GOOD NEWS A famous investment research expert reveals the ONE REASON why America’s next collapse could be great news for fast-acting Americans. Urgent new briefing reveals incredible wealth opportunity — watch here right now. The Daily Reckoning Presents The Eight Marks of Fascist Policy, Part II Lew Rockwell [Ed. Note: In his 1944 book, As We Go Marching, John T. Flynn outlined what he saw as eight marks of fascist policy. Recently, at Doug Casey’s “When Money Dies” conference in Phoenix, AZ, Llewellyn Rockwell presented Flynn’s points, offering some thoughts on each as he went. In today’s edition, we present a snippet from that presentation. For Part I, please see here.] Point 5. Economic planning is based on the principle of autarky. Autarky is the name given to the idea of economic self-sufficiency. Mostly this refers to the economic self-determination of the nation- state. The nation-state must be geographically huge in order to support rapid economic growth for a large and growing population. This was and is the basis for fascist expansionism. Without expansion, the state dies. This is also the idea behind the strange combination of protectionist pressure today combined with militarism. It is driven in part by the need to control resources. Look at the wars in Iraq, Afghanistan, and Libya. We would be supremely naive to believe that these wars were not motivated in part by the producer interests of the oil industry. It is true of the American empire generally, which supports dollar hegemony. It is the reason for the planned North American Union. The goal is national self-sufficiency rather than a world of peaceful trade. Consider, too, the protectionist impulses of the Republican ticket. There is not one single Republican, apart from Ron Paul, who authentically supports free trade in the classical definition. From ancient Rome to modern-day America, imperialism is a form of statism that the bourgeoisie love. It is for this reason that Bush’s post-9/11 push for the global empire has been sold as patriotism and love of country rather than for what it is: a looting of liberty and property to benefit the political elites. 6. Government sustains economic life through spending and borrowing. This point requires no elaboration because it is no longer hidden. There was stimulus 1 and stimulus 2, both of which are so discredited that stimulus 3 will have to adopt a new name. Let’s call it the American Jobs Act. With a prime-time speech, Obama argued in favor of this program with some of the most asinine economic analysis I’ve ever heard. He mused about how is it that people are unemployed at a time when schools, bridges, and infrastructure need repairing. He ordered that supply and demand come together to match up needed work with jobs. Hello? The schools, bridges, and infrastructure that Obama refers to are all built and maintained by the state. That’s why they are falling apart. And the reason that people don’t have jobs is because the state has made it too expensive to hire them. It’s not complicated. To sit around and dream of other scenarios is no different from wishing that water flowed uphill or that rocks would float in the air. It amounts to a denial of reality. Still, Obama went on, invoking the old fascistic longing for national greatness. “Building a world-class transportation system,” he said, “is part of what made us an economic superpower.” Then he asked, “We’re going to sit back and watch China build newer airports and faster railroads?” Well, the answer to that question is yes. And you know what? It doesn’t hurt a single American for a person in China to travel on a faster railroad than we do. To claim otherwise is an incitement to nationalist hysteria. As for the rest of this program, Obama promised yet another long list of spending projects. Let’s just mention the reality: No government in the history of the world has spent as much, borrowed as much, and created as much fake money as the United States. If the United States doesn’t qualify as a fascist state in this sense, no government ever has. None of this would be possible but for the role of the Federal Reserve, the great lender to the world. This institution is absolutely critical to US fiscal policy. There is no way that the national debt could increase at a rate of $4 billion per day without this institution. Under a gold standard, all of this maniacal spending would come to an end. And if US debt were priced on the market with a default premium, we would be looking at a rating far less than A+. Point 7. Militarism is a mainstay of government spending. Have you ever noticed that the military budget is never seriously discussed in policy debates? The United States spends more than most of the rest of the world combined. And yet to hear our leaders talk, the United States is just a tiny commercial republic that wants peace but is constantly under threat from the world. They would have us believe that we all stand naked and vulnerable. The whole thing is a ghastly lie. The United States is a global military empire and the main threat to peace around the world today. To visualize US military spending as compared with other countries is truly shocking. One bar chart you can easily look up shows the US trillion-dollar-plus military budget as a skyscraper surrounded by tiny huts. As for the next highest spender, China spends 1/10th as much as the United States. Where is the debate about this policy? Where is the discussion? It is not going on. It is just assumed by both parties that it is essential for the US way of life that the United States be the most deadly country on the planet, threatening everyone with nuclear extinction unless they obey. This should be considered a fiscal and moral outrage by every civilized person. This isn’t only about the armed services, the military contractors, the CIA death squads. It is also about how police at all levels have taken on military-like postures. This goes for the local police, state police, and even the crossing guards in our communities. The commissar mentality, the trigger-happy thuggishness, has become the norm throughout the whole of society. If you want to witness outrages, it is not hard. Try coming into this country from Canada or Mexico. See the bullet-proof-vest- wearing, heavily armed, jackbooted thugs running dogs up and down car lanes, searching people randomly, harassing innocents, asking rude and intrusive questions. You get the strong impression that you are entering a police state. That impression would be correct. Yet for the man on the street, the answer to all social problems seems to be more jails, longer terms, more enforcement, more arbitrary power, more crackdowns, more capital punishments, more authority. Where does all of this end? And will the end come before we realize what has happened to our once-free country? Point 8. Military spending has imperialist aims. Ronald Reagan used to claim that his military buildup was essential to keeping the peace. The history of US foreign policy just since the 1980s has shown that this is wrong. We’ve had one war after another, wars waged by the United States against noncompliant countries, and the creation of even more client states and colonies. US military strength has led not to peace but the opposite. It has caused most people in the world to regard the United States as a threat, and it has led to unconscionable wars on many countries. Wars of aggression were defined at Nuremberg as crimes against humanity. Obama was supposed to end this. He never promised to do so, but his supporters all believed that he would. Instead, he has done the opposite. He has increased troop levels, entrenched wars, and started new ones. In reality, he has presided over a warfare state just as vicious as any in history. The difference this time is that the Left is no longer criticizing the US role in the world. In that sense, Obama is the best thing ever to happen to the warmongers and the military-industrial complex. As for the Right in this country, it once opposed this kind of military fascism. But all that changed after the beginning of the Cold War. The Right was led into a terrible ideological shift, well documented in Murray Rothbard’s neglected masterpiece The Betrayal of the American Right. In the name of stopping communism, the right came to follow ex-CIA agent Bill Buckley’s endorsement of a totalitarian bureaucracy at home to fight wars all over the world. At the end of the Cold War, there was a brief reprise when the Right in this country remembered its roots in noninterventionism. But this did not last long. George Bush the First rekindled the militarist spirit with the first war on Iraq, and there has been no fundamental questioning of the American empire ever since. Even today, Republicans elicit their biggest applause by whipping up audiences about foreign threats, while never mentioning that the real threat to American well-being exists in the Beltway. Regards, Llewellyn H. Rockwell Jr., for The Daily Reckoning Joel’s Note: If, as Mr. Rockwell asserts, the US is much further down that road to fascism than most people think (or indeed, already there), it probably helps to at least have an idea of what’s going on. Last Friday, Agora Financial executive publisher, Addison Wiggin, released a presentation that most people won’t want to view. It contains certain truths they simply don’t want to hear. But ignoring these facts won’t make them go away...and it won’t help people properly prepare for their consequences. Take a look at what Addison has to say here. EXPOSED: The Real Reason Iran Wants the Bomb The secretive Pentagon and “Know Nothing” White House wants this issue to go away. WHY? Because what I’m about to tell you could be lethal enough to at least DOUBLE the price of oil in 2012... Bunker down against soaring energy costs with ONE “safe haven” financial plan that could protect you and pay impressive gains... Click here to watch the video now. Bill Bonner The Shifting Focus of US Consumer Spending Bill Bonner Reckoning from Paris, France... The feds released a jobs report on Friday. It said that things weren’t as bad as everyone thought. The US economy actually added 103,000 new jobs in September. But wait. That is not a lot of jobs. There are about 150 million people who make up the labor force. This number increases — by immigration and population growth — by about 1.2 million per year. So, 100,000 new jobs doesn’t do much to restore full employment. But it’s better than nothing. And nothing was what the figures showed for the month of August. Those figured were revised upwards too — to show 57,000 jobs created in that month. Investors were blasé. The Dow fell slightly on Friday. The yield on the 10-year US government note ended the week over 2%. And gold finished trading on Friday at $1,635. The newspapers were more enthusiastic. They widely reported the job numbers with approval and hope. Stabilizing prices and new jobs mean that the odds of a ‘double-dip’ recession diminished, they say. But so what? Recession is not the problem. Recession refers to GDP growth. It measures “more” or “less.” An expanding economy uses more resources and produces more stuff. A shrinking economy — one in recession — produces less stuff. But what if the real problem had less to do with how much stuff we have and more to do with what kind of stuff it is? If you have another car or another refrigerator, are you better off? What about another gall bladder operation or another war? Or maybe you’d like another gadget from China or another helping of dessert? You would have more stuff. Would you be better off? Not necessarily. And a lot of people are turning against it. And if they’re not, they should be. Partly because they can’t afford more stuff. Partly because they have enough already. And partly because stuff is getting in their way. Here’s a Daily Reckoning dictum: people come to think what they must think when they must think it. When it no longer pays to build more stuff... And when people can no longer afford to buy more stuff... ..Stuff will become unpopular. Already, according to TIME magazine, the average American is spending 2% less on goods and services than he did 4 years ago. That is a big change in a consumer economy. And he’s shifting the focus of his spending too. Expensive foreign- made cars are not selling like they used to. He’s not traveling overseas as much either. Nor is he going to theme parks and sporting events. Instead, he’s staying at home and watching TV. And here’s something interesting...the number of farmers’ markets is way up. Why? Because the consumer has shifted from more to better. He doesn’t want more food; he wants better food. And he’s spending more on games and communication devices too. Apparently, people consider these things important to the quality of their lives. There’s also a new trend developing in housing. The big, gaudy McMansion is giving way to the small cottage with charm. Big houses are hard to heat and expensive to keep up. And they’re also not very cozy. Small houses, on the other hand, can be more comfortable...and more fun to live in, if you like the people you’re living with. Ostentatious wealth is probably falling out of fashion for another reason: it is becoming a political target. The rich are few. But their unpopularity is a measure of their wealth, not their numbers. They are becoming an unloved, vulnerable minority, widely blamed for the economic crisis, with few defenders in public life. What can they do? They sit in their guarded enclaves and wait for the mob to rise up against them. Some try to coddle favor with the masses by giving money to charities and even offering to pay higher tax rates. Others lie low...drive old cars...and renew their passports. Stay tuned... And more thoughts... But what’s this? While the middle classes hunker down and spend less...the rich continue to splash out. They want better too — better stuff, with brand names on it! Protestors may complain about them. The Democrats want to ‘sock it to them’ with a big new tax. And the man on the street figures they’ve put one over on him. But they should all thank the rich, not damn them. In a consumer economy, who else can consume? Here’s the report from Bloomberg: When stock markets tumble, wealthy US shoppers typically cut back their visits to such luxury emporiums as Saks Inc. (SKS) and Nordstrom Inc. (JWN) Yet even as the markets have seesawed, they’ve kept right on spending. Exhibit A: Saks and Nordstrom yesterday reported September sales that exceeded analysts’ estimates, while luxury retailers as a whole outpaced all other segments except gasoline-selling wholesale clubs. Affluent Americans aged 24 to 49 who have a yen for high living and bling are helping drive luxury sales, says Unity Marketing, which conducts quarterly shopper surveys. One cohort, called the “X- Fluents” — for “extremely affluent” — are responsible for 23 percent of luxury sales in the US, up from 18 percent in 2007, the Stevens, Pennsylvania-based firm said in a Sept. 14 client presentation it provided to Bloomberg News. “The US marketplace is more concentrated among young people,” said Unity President Pam Danziger. “They are more predisposed to luxury indulgence and represent more promising targets to luxury brands.” Another group that Unity has dubbed “Aspirers” are also spending more on luxury, according to Danziger. They favor “flash, bling and status” and now account for 18 percent of luxury sales compared with 16 percent in 2007, she said. In the past, affluent shoppers’ willingness to buy baubles has been tied to the stock market because its performance affects the perception of their own wealth — the so-called wealth effect. Luxury was the hardest hit retail segment during the financial meltdown three years ago; sales in the US plummeted 9.1 percent in 2009, according to the International Council of Shopping Centers. This time is different. Though the Dow Jones Industrial Average swung by 4 percentage points daily for an unprecedented stretch in August and consumer confidence stagnated near a two- year low in September, luxury sales may outpace the overall industry this holiday season. Regards, Bill Bonner, for The Daily Reckoning