- With news this week that Boeing, Home Depot, Caterpillar,
Sprint, and several other major corporations were laying off thousands
(the totals for January will top 150,000), it is easy, if not seemingly
imperative, for populist politicians to jump on the bailout bandwagon.
So, far the bailouts aren't working--unless you consider bailing out the
nation's wealthiest and best connected insiders as the actual purpose of
these programs. Each new bailout simply begets another round of bailouts
as every sector of the economy takes its turn at the government trough.
The adjusted monetary base, according to the St. Louis Federal Reserve
Bank has DOUBLED since the bailouts began. That means the value of every
dollar in your pocket has essentially been cut in half even if that hasn't
yet been reflected in retail prices. It will in time. This is the insidious
and hidden inflation tax that always accompanies government deficit spending.
Jobless claims have hit a 26-year high and states like Nevada have begun
using deliberate delaying tactics to save money by making it hard, if not
impossible, for the unemployed to file for unemployment benefits. This
is a national scandal in the making.
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- The unemployed in Las Vegas complain that they can't
get through on jammed telephone lines to the unemployment office--which,
ironically, refuses to deal with anyone in person. Now THAT is a very suspicious
policy position, leaving people absolutely no options other than going
back to the overloaded phone application system. They must file by phone,
and the state has obviously refused to increase either the number of lines
available or the number of operators to properly service this avalanche
of calls. Nobody knows why and officials are virtually silent. When people
finally do get through (typically 5 hours of constant dialing and redialing--
only to discover they must hold for a few more hours), they find they don't
get benefits for lost weeks trying to get into the system. Tough luck!
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- Over a week ago, I emailed the director of the Nevada
Workman's Compensation system in Southern Nevada to find out why the state
has failed to allow timely application, failed to expand the automated
system, and refused to allow people to appear in person. I got no reply
at all. At least I can surmise that they treat everyone equally bad, even
journalists. This kind of bureaucratic arrogance is reminiscent of the
old Soviet system. This also looks like grounds for a class action lawsuit.
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- As unemployment rises and the negative spending multiplier
continues to shrink the economy, all government wants to do is inflate
the currency and/or try to spend its way out of recession. Take a look
at the vertical rise in the adjusted monetary base figures put out by the
St. Louis Federal Reserve bank: http://research.stlouisfed.org/fred2/fredgraph?chart_type=line&w'=
- idth=1000&height=600&preserve_ratio=true&s[1][id]=AMBNS
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- As we are seeing, even that is too little, too late.
No matter how many billions the PTB throw at the problem, each month the
worsening figures accelerate. Even the appointment of Timothy Geithner
to be Treasury Secretary is an affirmation of more of the same rather than
change. As World Net Daily pointed out, Geithner, as head of the NY Federal
Reserve bank, presided over all of the worst financial debacles of the
last year. He was part of the problem.
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- Only Ron Paul of Texas has taken on the evils of Obama's
stimulus package head on. He not only decries the entire bailout concept,
but points out how the actual bill is full of bad provisions trying to
hitch a ride on the stimulus wagon.
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- "This bill is just an escalation of a government-created
economic mess. As before, a sense of urgency and impending doom is being
used to extract mountains of money from Congress with minimal debate. So
much for change. We are again being promised that its passage will help
employment, help homeowners, help the environment, etc. These promises
are worthless. This time around especially, Congress should know better
than to pass anything of this magnitude without first reading the fine
print."
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- Congressman Paul presented an abbreviated list of the
additions to this bill, to which I have added a more complete list courtesy
of one of my subscribers. It all adds up to a lot of "pork."
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- $30 billion to subsidize health insurance for those who
lose their jobs
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- $15 billion to increase college Pell Grants
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- $500 tax credits for people who earn less than $75,000
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- $1 billion for Amtrak, the federal railroad that hasn't
turned a profit in 40 years
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- $2 billion for child-care subsidies
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- $50 million for that great engine of job creation, the
National Endowment for the Arts;
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- $400 million for global-warming research
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- $2.4 billion for carbon-capture demonstration projects.
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- $650 million on top of the billions already doled out
to pay for digital TV conversion coupons
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- $30 billion, or less than 5% of the spending in the bill,
is for fixing bridges or other highway projects
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- $40 billion for broadband and electric grid development,
airports and clean water projects
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- $20 billion for business tax cuts
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- $252 billion is for income-transfer payments -- that
is, cash or benefits to individuals for doing nothing at all.
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- $81 billion for Medicaid
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- $36 billion for expanded unemployment benefits
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- $20 billion for food stamps
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- $83 billion for the earned income credit for people who
don't pay income tax
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- $54 billion will go to federal programs that the Office
of Management and Budget or the Government Accountability Office have already
criticized as 'ineffective' or unable to pass basic financial audits (includes
Economic Development Administration, the Small Business Administration,
the 10 federal job training programs, and many more.)
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- $66 billion more for education (including $335 million
for education related to sexually transmitted diseases)
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- $4 billion is allocated to expanding the police state
and the war on through Byrne grants and the COPS program, both of which
are corrupt and largely ineffective programs.
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- $20 billion would go towards health information technology,
which would create a national system of electronic medical records without
adequate privacy protection (These records would instead be subject to
the misnamed federal 'medical privacy' rule, which allows government and
state-favored special interests to see medical records at will)
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- $250 million is allocated for states to nationalize individual
student data, expanding Federal control of education and eroding privacy
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- $79 billion bails out states that haphazardly expanded
their budgets during the bubble years, but refuse to retrench and cut back,
as their taxpayers have had to, during recession years.
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- $200 million expands Americorps
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- $100 million goes to 'faith-and-community' based organizations
for social services, which will further insinuate the government into charity
and community service.
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- $4 billion for job training
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- $200 million to 'encourage' electric cars
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- $2 billion to support US manufacturers of advanced batteries
and battery systems
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- $500 million for energy efficient manufacturing demonstration
projects
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- $50 million for the National Cemetery Administration's
monument and memorial repairs
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- $2 billion for child-care subsidies
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- $100 million for reducing the danger of lead paint in
homes
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- $50 million for NASA facilities that may have been harmed
by natural disaster
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- $200 million for the U.S. Geological Survey to monitor
earthquakes and volcanoes
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- $70 million for a Technology Innovation Program for 'research
in potentially revolutionary technologies' -- government will pick winners
and losers
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- $746 million for after school snacks
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- $6.75 billion for the Department of Commerce, including
$1 billion for a census.
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- "This bill delivers an additional debt burden of
$6,700 to every American man, woman and child. There is a lot of stimulus
and growth in this bill - that is, of government. Nothing in this bill
stimulates the freedom and prosperity of the American people. Politician-directed
spending is never as successful as market-driven investment. Instead of
passing this bill, Congress should get out of the way by cutting taxes,
cutting spending, and reining in the reckless monetary policy of the Federal
Reserve."
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- THE RON PAUL SOLUTION:
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- "Here's what we HAVE to do to solve the problem,"
says Paul: "1) Let banks and companies fail if they cannot survive
on their own 2) Stop inflating asset prices with government purchases and
bailouts 3) End the Trillion dollar annual spending to maintain the US
Global Empire 4) Bring all our troops and assets home from around the world
5) End the fractional Federal Reserve banking system that caused the hyper
asset inflation through pyramid debt 6) Have the US Treasury take charge
of our monetary system and create a non debt based system.
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- Former Asst. Sec. of the Treasury Paul Craig Roberts
(one of the few who has bucked the system) agrees with this in general
when he writes, "The trillions of dollars in credit default swaps
(CDS) should be declared null and void. These 'swaps' are simply bets that
financial instruments and companies will fail, and the bulk of the bets
are made by people and institutions that do not hold the financial instruments
or shares in the companies... There is no reason under the sun for taxpayers
to bail out gamblers...
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- "To preserve the dollar's status as reserve currency,
a credible policy of reducing both budget and trade deficits must be announced.
In the near term the budget deficit can be reduced by $500 billion by withdrawing
from Iraq and Afghanistan and by cutting a bloated defense budget that
represents the now unattainable goal of US world hegemony. The trade deficit
can be significantly reduced by bringing off shored jobs back to America
[can't be done without a wholesale changing of the labor, environment and
tax regulations that drive companies overseas (as much as lower labor costs].
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- "This approach to the economic crisis stands in
marked contrast with the approach of the gangsters running US economic
policy. The gangsters are using the crisis as an opportunity to steal from
taxpayers and to finance their misdeeds and exorbitant salaries with Federal
Reserve loans. Their shills among economists and the financial press tell
the people that the solution is to fatten up the banks with funds so they
will resume lending to an over-indebted public that will then return to
the shopping malls. This unrealistic approach to a serious crisis indicates
a leadership crisis on top of an economic crisis." It's not a leadership
crisis in terms of lack of understanding or lack of competence. This is
a conspiracy of greed and power. A little review of the nature of this
conspiracy is in order.
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- World Affairs Brief = Commentary and Insights on
a Troubled World
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- Copyright Joel Skousen. Partial quotations with attribution
permitted.
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- Cite source as Joel Skousen's World Affairs Brief http://www.worldaffairsbrief.com
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