Daily News header

The Obama/Augustinian Rule - Is There More to Fear Than Fear Itself?

By  

To paraphrase Augustine of Hippo (en.wikipedia.org/wiki/Augustine_of_Hippo), the wild rake who late in life became saintly: "Oh Great John Maynard Keynes, Give Me Fiscal Restraint, but not yet please.

Obama has an incredibly tough job and the blame lies equally between the last couple of administrations and Congress (which abdicated its roll as the third branch of government in favor of imitating a rubber stamp.)

No single thing shows me just how bad this situation really is as much as the fact that the administration can't even find anyone willing to staff the Treasury Department's top jobs.

But consider.

Virtually everyone (notably excepting the heads of the Federal Reserve who were in charge of the loose credit) agrees that loose credit got us where we are.

Without loose credit the criminal lack of oversight by the government agencies who were supposed to be watching the cookie jar wouldn't have done much damage because the banks wouldn't have had the money to burn.

So, what is the Obama solution to disaster caused by loose credit?

Right! Looser credit!

I'm not Rush Limbaugh who apparently hasn't noticed that we are all riding in the same airplane and if the pilot crashes things won't be particularly comfortable for the passengers in first class either.

Do I have a better suggestion? Actually not because this is a political problem and there is never any good solution to those except radical change.

An economic solution under free enterprise is easy; let bankrupt banks go out of business, let factories which can't make money close down, etc. In a few years things will be fine again.

Politically that isn't possible which is proven by decades of voters electing politicians who tell them they can have any services or goods they want without paying for them.

The U.S. has lived for nearly 12 years by borrowing from China. You know about China, don't you? That's the big country which has lots of new factories and whose people save lots of money.

Spending (printing money) WILL stimulate the economy. Giving a morphine drip to a drug addict with gangrene in their big toe will make him feel a lot better - he may even get up and walk around.

But eventually the whole leg will have to come off, not just the foot.

I say there is no good solution because politicians NEVER accept great pain today to avoid greater pain later - they are collectively like teenagers whose brains aren't mature yet - unfortunately the last part of the brain to start working (around age 19-25) is the one which allows a person to predict the consequences of their bad acts.

We (the whole world) may pull out of this economic disaster by stimulating the economy. But, since the cure is just piling on the same medicine that caused the problem, eventually (5 years? 10 years?) the cliff in front of us will just be a lot higher and by then no one will believe in any rescue plans.

Keep printing enough money and the dollar will be devalued - that probably lies in our very near future - it has happened before - it is every government's eventual solution to having a really big debt.

Printing lots of money is the temporary way out but it never works in the long run.

The problem is that right now this is absolutely necessary!

What do people do when government fails to feed them? Ask Louis XVI or his bride Marie, Tsar Nicholas II, or the German republic BEFORE Hitler, or Japan in 1939, or the Roman Empire for that matter, etc.

Hungry people overthrow their governments. Threatened governments start wars to maintain power at home.

You say that makes no sense? True, but war isn't logical. Virtually every country which started a war has lost it.

The big danger now isn't bread lines in the U.S.; we can feed people given enough incentive.

But the big danger of a deep recession/depression is always the same - social unrest.

Don't take my word - check out the little noticed February 12 report from Dennis Blair, Director of National Intelligence.

www.dni.gov/testimonies/20090212_testimony.pdf

Mr. Blair told the Senate Select Committee on Intelligence:

  • Remember "The dramatic political consequences wrought by the economic turmoil of the 1920's and 1930's in Europe, the instability, and high levels of violent extremism."

  • If an economic crisis lasts more than one to two years there is an increase in "regime-threatening instability."

    The 46 page report goes on to describe the most dangerous places in the world and how they will be made more dangerous by the world-wide economic disaster.

    Some are obvious - Russia was oil rich two years ago, now it is broke. There are many other examples, one which hits home directly is the threat of massive northward refugee migration from Central and South America.

    Everyone in Congress knows all of this, so, when you hear politicians ranting for protectionism or against stimulus, just realize that they are talking through their hats and know it - they know the real risks, they just won't talk about them.

    An honest student of history will note that Roosevelt had far less to do with the end of the great depression than Hitler did.

    WWII showed that, indeed, we had far more to fear than just fear itself.

    John McCormick is a reporter, /science/medical columnist and finance and social commentator, with 17,000+ bylined stories. Contact John through NewsBlaze.

  •   Please leave a comment here     If it does not display within 10 seconds, please refresh the page

    * The views of Opinion writers do not necessarily reflect the views of NewsBlaze

    Related Opinions News

    Can you be fashionable when making a beeline to the gymnasium to get your daily dose of fitness? Apparently so, according to a rising star in the growing sector of fitness fashion design, Austin Martin (located in Houston, Texas)...
    Kevlar temporary tunnels should supplement armed and armored human security to protect evacuees from terrorists.
    More questionable IRS practices! The IRS has had its fingers in our bank accounts as well. Banks filed 700,000 suspicious reports last year and the IRS has been bankrupting people.
    Ferguson, Missouri grows as a harbinger of things to come. Racial unrest grows exponentially in this country as our ghettos flourish, jobs vanish and hope dissolves into despair. Fifty gunfights in Chicago over the 4th of July weekend give you an id
    The first step is as old as time and sets out to silicify the weak and unfortunate people and addict them to governments hand outs (the dole) to gain power over them and to enslave them to a system of continual dependency.
    Sometimes a culture's mood sours over time, before you even know it's happening. A stifling rule here, an ignored idea there, and before long you've zapped the entrepreneurial spirit that enabled your employees to create great things at your company

     

    NewsBlaze Writers Of The Month



    Popular Stories This Month

    newsletter logo

    NewsBlaze
    Copyright © 2004-2014 NewsBlaze Pty. Ltd.
    Use of this website is subject to our Terms of Service and Privacy Policy  | DMCA Notice               Press Room   |    Visit NewsBlaze Mobile Site