New Media Alliance - Thomas E. Brewton

By Thomas E. Brewton

As Keynes observed, people often unknowingly are the prisoners of erroneous doctrine propounded by long dead theoreticians, in this case doctrine of Keynes himself.

I have noted before that Wall Street Journal news reporters often display pervasive, sometimes subtle, liberal-progressive-socialist biases. Unlike the Journal’s editorial board writers, among other things, they still parrot the nonsense popularized by economist John Maynard Keynes during the 1930s Depression.

Since Keynesian economics is the reigning school of thought in socialistic academia, it’s no surprise that Keynesian nostrums are repeated, without evaluation, by today’s reporters.

One example is in the Journal article titled The Doomsayers Who Got It Right.

The Journal reporter writes:

Those who saw the crisis coming, on the other hand, fret that U.S. government spending on bailouts and stimulus plans that preserve failed business models could increase the likelihood of a worse calamity later.

They foresee a long season in which consumers cut their spending, and instead sharply increase the savings rate. That would be healthy for savings-anemic U.S. households, which have spent beyond their means for years, but deeply problematic for a country where consumers drive 70% of all economic activity.

The matter of concern is the statement that increased personal savings would be “deeply problematic for a country where consumers drive 70% of all economic activity.”

Keynes asserted that the root cause of our Depression was excess savings. His thesis was that savings take money out of circulation, thereby reducing consumption and putting ever greater downward pressure on business activity and job creation. The appropriate remedy, in Keynesian doctrine, is endlessly expanded government deficit spending.

This same thesis, needless to say, is widely advocated by Democrat/Socialist and liberal Republican politicians, by Wall Street operatives, and by liberal-progressive-socialist economists. News reporters and commentators, in the main, go along for the ride.

So, what is wrong with the Journal reporter’s statement?

First, is assumes that money placed by individuals in savings accounts will no longer be available in the flow of economic activity, that it will, in effect, be buried in the back yard or under a mattress.

What really happens is that savings, through one channel or another, end up as increased deposit balances on lenders’ balance sheets. Several beneficial effects arise from this.

One is that banks and other financial intermediaries have increased and more stable lendable funds. Consumers with higher savings are more creditworthy and will find it easier to obtain bank loans. Ask yourself why former investment bank titans Goldman Sachs and Morgan Stanley opted to become commercial bank holding companies and compete to get stable bank deposits.

Government stimulus programs, in contrast, produce temporary and therefore unreliable bursts of increased bank deposits, leaving lenders wary of significant increases in lending activity.

Another benefit is that, with balance sheets strengthened by stable savings deposits, financial institutions are less dependent upon Federal largesse and less likely to become ensnared in European-style regulatory management of lending and investment policy. Innovative new businesses and existing small businesses, which create disproportionately more new jobs, will gain additional financial support.

In contrast, as the price of bailout funds government is nudging banks into lending to keep Detroit’s Big Three automakers and the UAW union afloat, and to compel higher investments in the least profitable of auto products: hybrid or battery-driven “green” cars.

The second major problem with the erroneous Keynesian doctrine expressed in the Journal news story is that consumption does not in fact drive the economy. The wages and profits, from which come consumer spending and saving, cannot exist without the long chain of business expenditures for investment in new equipment, new process, and for payments to materials suppliers and workers.

Consumption expenditures are just one of the by-products of business expenditures. Business expenditures are the real drivers of the economy.

Business expenditures for new investment and for production of basic, intermediate, and consumer goods are as large as, generally larger than, consumer expenditures.

The exception is a period like our recent one, in which government deficit spending leads to excessive fiat money creation by the Fed. That impels an unsupportable increase in borrowing, as the value of the dollar declines. Consumer borrowing in this circumstance, as we have witnessed over the last 15 to 20 years, leads to negative savings. Consumer spending was increasingly floated on credit-card and home-equity-loan borrowing. Spending more than we produce does not make a healthy economy. It just booms imports.

Government stimulus programs may be welcomed by businesses and consumers in the vain hope that they will provide relief from a recession. But we know from unvarying experience, beginning here with the Roosevelt New Deal, that government stimulus spending never ends a recession. In fact such spending tends to prolong and to worsen a recession.

One reason for the failure of stimulus programs is that consumers, already fearful of losing jobs, tend to use stimulus payments to reduce debt and to increase savings. Very little of it goes to added consumption goods spending. President Bush’s stimulus program early in 2008 was a flop. President-elect Obama’s will end the same way.

Another and more fundamental reason is that business does not like uncertainty. When the Federal government begins tinkering with the economy, as it did in the Depression and as it is doing now, it creates new layers of bureaucracy to administer new and more restrictive business regulation. Government typically increases business taxes at the same time, while mandating costly new business methods (think of the looming presence of president-elect Obama’s Carol Browner and other other Al Gore environmentalists).

In such times of high costs, low profits, and prospective government experimentation and regimentation, prudent businessmen hesitate to increase production or to make new production investments. And without production increases there will be no increased payments to suppliers and workers and therefore no wage increases or added jobs.

Government stimulus spending financed with more debt adds to inflationary pressures. This is what occurred in the 1970s stagflation. During a high inflation period, which almost certainly will hit us within the next couple of years, people’s nominal incomes increase, but their costs of living rise even faster. Worse, as their nominal income rises, they are pushed up into higher tax brackets.

The final injury of the fiction that consumer spending drives the economy is that the government pays for its ineffective, indeed counterproductive, stimulus programs by stealing consumers’ lifetime savings. By the mid-1980s, when the 1970s stagflation was finally halted by Paul Volcker, the real purchasing power of consumers’ lifetime savings was less than half what it had been before President Johnson’s Great Society welfare-state entitlements set in motion our destructive 1970s inflation.

Thomas E. Brewton is a staff writer for the New Media Alliance, Inc. The New Media Alliance is a non-profit (501c3) national coalition of writers, journalists and grass-roots media outlets.

His weblog is THE VIEW FROM 1776
http://www.thomasbrewton.com/

Email comments to viewfrom1776@thomasbrewton.com

By Thomas E. Brewton

Earthly things wither and die, but the Word of God prevails forever.

Pastor Dan Gardner preached the sermon Sunday at the Cohocton (New York) Assembly of God Church. His text was Isaiah 40:1-8:

Comfort, comfort my people, says your God. Speak tenderly to Jerusalem, and proclaim to her that her hard service has been completed, that her sin has been paid for, that she has received from the LORD’s hand double for all her sins.

A voice of one calling: “In the desert prepare the way for the LORD; make straight in the wilderness a highway for our God.

Every valley shall be raised up, every mountain and hill made low; the rough ground shall become level, the rugged places a plain.

“And the glory of the LORD will be revealed, and all mankind together will see it. For the mouth of the LORD has spoken.”

A voice says, “Cry out.” And I said, “What shall I cry?” “All men are like grass, 
and all their glory is like the flowers of the field. The grass withers and the flowers fall, because the breath of the LORD blows on them. Surely the people are grass.

The grass withers and the flowers fall, but the word of our God stands forever.

The following is the gist of Pastor Gardner’s sermon, with my interpolations and extrapolations. Any misrepresentations are mine, not his.

As far back as 2200 BC, 4,200 years ago, those who were to become the people of Israel, were devoutly aware that their universe owed its existence to a God whose almighty name was so awe inspiring that it could not be spoken.

As Pastor Gardner noted, our Western world has turned its back on the Word of God, but the Word of God remains there. God’s Word is creation itself. Our world was formed by the Word of God.

In the beginning God created the heavens and the earth. Now the earth was formless and empty, darkness was over the surface of the deep, and the Spirit of God was hovering over the waters. And God said, “Let there be light,” and there was light. (Genesis 1:1-3)

In a more philosophical vein, around AD 60, the disciple whom Jesus loved wrote:

In the beginning was the Word, and the Word was with God, and the Word was God. (John 1:1)

The Word of God, the ground of being itself preceding the creation of our universe, was, is, and will be there, completely outside our world, yet regulating it with His laws of nature. Those laws uniquely gave humans the power of a fully rational mind coupled with free will. We humans can be led to the wisdom of age-old experience, but God does not compel each individual to follow that wisdom. It’s up to us to seek Jesus and to believe in the Word of God.

In today’s sermon, Pastor Gardner noted that there are three scholarly approaches to validating the Word of God: internal evidence in the Scriptures, external evidence, and bibliographical evidence. Pastor Gardner focused today upon the first of these.

Within the Bible we find an abundance of internal evidence attesting that every word in the Bible is Divinely inspired.

The word “inspired” is rich in symbolic significance. Inspiration literally means “breathed in.”

…the LORD God formed the man from the dust of the ground and breathed into his nostrils the breath of life, and the man became a living being. (Genesis 2:7)

Thus we can speak of the living, revealed Word of God inspired by the Holy Spirit in human rationality.

No student of the physical sciences, no atheist or agnostic, despite continual efforts, has ever been able to fathom how God created life on earth. Instead they posit some incredibly silly hypotheses about coagulating mud crystals, becoming by random chance, the progenitors of DNA, or else they shrug their shoulders and assume that the world had no beginning, that it has always been as it is.

What internal evidence in the Bible is our basis for believing it to be the Truth?

First, Pastor Gardner related, the Old and New Testaments contain at least 668 prophesies of future events, prophesies often made decades or even hundreds of years before their fulfillment.

The prophet Daniel, for example, almost 250 years before the events, foretold conquest of Persia by Alexander the Great and the subsequent split of his empire among four generals. (Daniel 8:15-26)

The prophet Isaiah, more than 150 years in advance, foretold that the Israelites would be released from their Babylonian captivity by Persian king Cyrus:

…who says of Cyrus, ‘He is my shepherd and will accomplish all that I please; he will say of Jerusalem, “Let it be rebuilt,” and of the temple, “Let its foundations be laid.” (Isaiah 44:28), and

I will raise up Cyrus in my righteousness: I will make all his ways straight. He will rebuild my city and set my exiles free, but not for a price or reward, says the LORD Almighty. (Isaiah 45:13)

C. S. Lewis, the celebrated convert from agnosticism in adulthood, was a specialist in mythology. He tells us that nowhere in mythology is there the wealth of specific detail about every-day things that characterizes the Old and the New Testaments.

Biblical accounts are not myths made up by men. Particularly so the four Gospels. They were written, within 30 to 50 years of Jesus’s crucifixion and resurrection, by eyewitnesses, men who were living with Jesus every day during his roughly three year ministry.

As Lewis also said, nobody willingly subjects himself to the abuse, physical punishment, and the martyrs’ deaths of these men just to defend a myth. A typical eyewitness account is that of the disciple John:

Jesus did many other miraculous signs in the presence of his disciples, which are not recorded in this book. But these are written that you may believe that Jesus is the Christ, the Son of God, and that by believing you may have life in his name. (John 20:30-31)

The apostle Paul, transformed by his experience on the road to Damascus, writes in 2 Timothy 3:16-17:

All Scripture is God-breathed and is useful for teaching, rebuking, correcting and training in righteousness, so that the man of God may be thoroughly equipped for every good work.

For prophecy never had its origin in the will of man, but men spoke from God as they were carried along by the Holy Spirit. (2 Peter 1:21)

In the first of Paul’s epistles to the Thessalonians:

And we also thank God continually because, when you received the word of God, which you heard from us, you accepted it not as the word of men, but as it actually is, the word of God, which is at work in you who believe. (1 Thessalonians 2:13)

For the word of God is living and active. Sharper than any double-edged sword, it penetrates even to dividing soul and spirit, joints and marrow; it judges the thoughts and attitudes of the heart. (Hebrews 4:12)

Your word, O LORD, is eternal; it stands firm in the heavens. (Psalms 119:89)

Since the middle of the 18th century, Westerners have increasingly turned away from God and have sought counsel among false prophets who tell us that their modern religious gnosticism can, through the secular political state, perfect humanity and human society here on earth.

This is the legacy of the French so-called Enlightenment (not to be confused with the earlier English, Scottish, and American Enlightenments).

French intellectual contributors to the Encyclopedia, from the 1750s onward, poisoned the world with their secular, philosophical materialism and the post-Revolution doctrines of Auguste Comte’s positivism.

Comte’s Religion of Humanity denied the existence of God and hubristically declared that the proper object of worship was humanity itself. We were to worship ourselves, because the prophets of secularism, Saint-Simon and Comte, later Marx and Lenin, claimed to have discovered ineluctable laws of history that decreed the evolution of society beyond the Word of God and into a new scientific age, in which intellectuals would lead us to perfection.

The sermon topic was why should one believe the Holy Scriptures? A parallel question is why should any intelligent person place his faith in liberal-progressive-socialism?

Rather than world peace, anticipated by 19th century liberal-progressive-socialists, their moral relativism, secularity, and philosophical materialism inflicted bloodshed and tyranny on a scale unprecedented in history: the French Revolution’s Reign of Terror (in which more than 70,000 French citizens were murdered in the name of Liberty, Equality, and Brotherhood); two devastating world wars; Hitler’s National Socialist (Nazi) regime (that perpetrated the Holocaust and also liquidated a few million Poles, Czechs, and Russians); the Russian Revolution of 1917 (which killed, at a minimum, more than ten million people); Mao’s Communist China, which liquidated a similar number of millions of people; down to recent and current repression in Cuba under Castro, in Nicaragua under the Sandinistas, and in Venezuela under Hugo Chavez.

Reverence for life, especially for that of each human being, including the unborn, is a bed-rock principle of Christianity and of our Judeo-Christian heritage. Liberal-progressive-socialists, despite their claims of “caring” about the masses, have been unperturbed by the liquidation of many tens of millions of their fellows by socialist political states in the name of perfecting humanity. And they have eagerly embraced the murder of millions of babies via abortion.

Why did liberal-progressive-socialists ignore the Word of God and remain apologists for these barbaric actions?

The answer is that intellectual brilliance seldom is accompanied by wisdom and judgment. Without guidance from the Holy Spirit and the self-restraint that comes from acknowledging God as the Creator of the universe, it’s too easy for intellectuals to fall victim to self-worship. Denying God, they believe that their superior intellects can master nature (witness Al Gore and the power-trip myth of man-made global warming).

Liberal-progressive-socialists, who scathingly ridicule Christianity and our Judeo-Christian moral heritage, look into the mirror every day and see the god whom they worship: themselves.

And now this admonition is for you, O priests. If you do not listen, and if you do not set your heart to honor my name,” says the LORD Almighty, “I will send a curse upon you, and I will curse your blessings. Yes, I have already cursed them, because you have not set your heart to honor me…

For the lips of a priest ought to preserve knowledge, and from his mouth men should seek instruction—because he is the messenger of the LORD Almighty. But you have turned from the way and by your teaching have caused many to stumble; you have violated the covenant with Levi,” says the LORD Almighty. (Malachi 2:1-2; 7-8)

One of the great ironies of liberal-progressive-socialism is its claim to deal only with objective, scientifically measurable truth embodied in the tangible aspects of nature. Yet their historicism gives us nothing concrete at all. Liberal-progressive-socialism’s intellectual hypotheses depend upon unquantifiable abstractions such as “humanity,” “history,” the “laws of history,” the “world community,” “workers of the world,” the “proletariat,” and “social justice.” Nowhere in human history have these theoretical concepts had an objective existence. They are nonetheless key components in the guiding dogma of liberal-progressivism’s gnostic religion of socialism.

The Truth is that God created a vast variety of individuals and gives each of us the opportunity to renounce our self-centered, hubristic vanity and to turn to Him for guidance. Following the Bible’s great commandments - have no God but God and worship Him only; love your neighbor as you wish to be loved yourself - is the only approach in this life toward the real perfection that is to be found in Heaven.

His Word is and was, and will be eternally in place. We, in our short lives, can only endeavor to participate in the mystery that is God’s Revealed Word.

Thomas E. Brewton is a staff writer for the New Media Alliance, Inc. The New Media Alliance is a non-profit (501c3) national coalition of writers, journalists and grass-roots media outlets.

His weblog is THE VIEW FROM 1776
http://www.thomasbrewton.com/

Email comments to viewfrom1776@thomasbrewton.com

By Thomas E. Brewton

New York Times columnist Bob Herbert denounces spending borrowed money, apparently unaware that he is stepping on the party line.

Mr. Herbert is about as far left in his liberal-progressive ideology as any writer in today’s mainstream media. Yet he has glimpsed enough of the truth to identify consumption floated by excessive debt as a cause of our present economic woes.

Read the whole column: Stop Being Stupid.

All conservatives, I believe, will wholeheartedly second Mr. Herbert’s assertion that, “Somehow, over the past few decades, that has become the American way: to pay for things — from wars to Wall Street bonuses to flat-screen TVs to video games — with money that wasn’t there.”

There are, however, important points of divergence reflecting Mr. Herbert’s economic paradigm.

The picture that Mr. Herbert conveys is of an economy that is, and should be, collectivized and managed by a coterie of experts in Washington; an economy in which individual people and businesses are incapable of making beneficial decisions for themselves; an economy in which only the government has the right to and the ability to make proper choices for use of scarce economic resources.

A few phrases from his column illustrate the point:

… top government officials and financial titans who were supposed to be guarding the nation’s wealth…

We shipped American jobs overseas by the millions and came up with the fiction that this was a good deal for just about everybody. We could have and should have taken the time and made the effort to think globalization through…

“We,” he says, meaning apparently the Federal government, should regulate the process of business globalization. Just after World War II when countries were still devastated by the war, this was known as currency control, under which no one could exchange his local money for foreign currency or make any kind of investment outside his country without the approval of government ministers. When currency controls finally were lifted, international trade bloomed and standards of living rose rapidly.

There is broad agreement that we have no choice but to go much more deeply into debt to jump-start the economy. But we have tremendous choices as to how we use that debt.

We should use it to invest in the U.S. — in a world-class infrastructure (in its broadest sense) to serve as the platform for a world-class, 21st-century economy, and in a system of education that actually prepares American youngsters to deal successfully with the real world they will be encountering.

We need to invest in a health care system that improves the quality of American lives, enhances productivity…

We need to care for our environment (if long-term survival means anything to us)…

And, finally, we need to start living within our means and get past the nauseating idea that the essence of our culture and the be-all and end-all of the American economy is the limitless consumption of trashy consumer goods.

The elitist perspective of liberal-progressivism is clearly revealed in Mr. Herbert’s phrase “limitless consumption of trashy consumer goods.” Since the inception of socialist doctrine in Revolutionary France of the early 19th century, socialist intellectuals have maintained that ordinary citizens are offered too many choices of consumer goods. The assumption is that bureaucratic regulators can manage the economy more efficiently than individual people and businesses and that one means of making the economy more efficient is to limit the numbers of products and services offered to the citizenry.

It’s true that a free-market economy produces a profusion of products, some of which are trashy. But that is an inseparable part of the liberties for which the colonists fought in 1776. The right of entrepreneurs to produce things that consumers will buy (apart from criminally connected items) was one of the intentions of the Bill of Rights, which endeavored to protect private economic and political liberties from arbitrary government action of the type favored by liberal-progressives. Think of the Boston Tea Party, sparked by a British order requiring Boston citizens to purchase taxed tea from a handful of merchants selected by the crown.

Mr. Herbert uses the familiar liberal-progressive-socialist term “investment” for expansion of government regulation, for example a nationalized, socialized health care system.

Investment, by definition, is expenditures intended to increase future production efficiency and output. Socialized medicine does nothing of the kind. It merely transfers money from wealthier people to poorer people, as determined by Federal bureaucrats, while overlaying the process with costly regulations administered by tens of thousands of paper shufflers who add not a whit to the real GDP. In farming terms, this is known as eating your seed corn.

Liberals as a whole, perhaps not Mr. Herbert, assume that greater funding for teachers’ unions will improve our students’ level of academic achievement. In reality, Federal funding for education since the inception of President Johnson’s Great Society has produced a steadily declining quality of education. The only beneficiaries have been the teachers’ unions and the liberal-progressive-politicians whose election campaigns the unions finance.

American education before the Great Society was incomparably better, in fact among the best in the world. Education then was a strictly local matter, controlled by local school boards that were free to hire and fire teachers on the basis of competence. And schools were free to expel disruptive students who were interfering with the opportunity of other students to get an education.

Mr. Herbert’s liberal-progressive-socialist paradigm makes it impossible for him to connect the economic dots that form a complete picture of economic reality. This, no doubt, because the liberal-progressive-socialist economic paradigm is an entirely theoretical construct that must be forced into a box labeled social justice, i.e., redistribution of wealth to make us all equally poor.

Mr. Herbert seems not to recognize that his derogation of rampant consumption funded by debt runs into a head-on collision with one of the most basic doctrinal elements in liberal-progressive-socialism: the belief that consumption is the driver of the economy and that full-employment levels of consumption depend upon government deficit spending.

At bottom, all of the economic phenomena of which he complains originate in welfare-state, social justice programs funded by Federal deficit spending, which is financed by the Federal Reserve’s limitless expansion of the fiat money supply, with its inevitable inflationary effects.

History for centuries records the same set of phenomena attendant upon paying for government expenditures with fiat money that cannot be converted into a valuable commodity like gold. Prices rise faster than wages, because inflation negatively impacts business costs, which retards job creation and wages increases. As prices rise (think of the housing boom), money becomes worth less, leading people to save less. In the early stages of rapidly increasing fiat money expansion (where we are now), interest rates decline, leading people to take speculative risks to attain investment returns high enough to offset the effects of inflation. Because money steadily loses purchasing power, people are encouraged to borrow increasing amounts of money to fund consumption, expecting to be able to repay the debt in the future with ever cheaper money.

The bottom line is that Mr. Herbert unknowingly is damning the economic orthodoxy of his own liberal-progressive-socialism: Keynesian economics. In the 1930s, John Maynard Keynes propounded a discredited theory still advocated by liberals like Paul Krugman, which denounced savings as the cause of the Depression and recommended massive government deficit spending to offset private saving.

In Keynesian doctrine, consumption expenditures, for anything from digging and filling useless holes to funding anti-business regulation, is the route to economic salvation. This is the nature of President Bush’s earlier economic stimulus plan and of the incoming Obama administration’s $ trillion stimulus plan.

Thomas E. Brewton is a staff writer for the New Media Alliance, Inc. The New Media Alliance is a non-profit (501c3) national coalition of writers, journalists and grass-roots media outlets.

His weblog is THE VIEW FROM 1776
http://www.thomasbrewton.com/

Email comments to viewfrom1776@thomasbrewton.com

By Thomas E. Brewton

Everything, from people within the Weatherman Underground, to Bill Ayers’s own words, proves his mendacity.

Doug Welsh on his Twitter site posted a link to Larry Grathwohl’s reply to Ayers.

Mr. Grathwohl, from his personal knowledge as an FBI infiltrator in the Weatherman underground in the late 1960s and early 70s, confutes the self-serving, hypocritical rationalizations that Mr. Ayers and his wife Bernadine Dohrn are now peddling.

In the same vein, read Bill Ayers: Unrepentant Terrorist and Hypocrite and Obama and Ayers Pushed Radicalism In Schools.

Organized anti-American student anarchism began with Students for a Democratic Society (SDS) and Tom Hayden’s 1962 Port Huron Statement. More violent, radical members of SDS, among them Bill Ayers and Bernadine Dohrn, broke away from SDS to form Weatherman.

The ethos of this violent, anarchist student-activist movement is preserved in Weatherman, a 519-page compilation of articles and speeches by members of the group published in 1970 by Ramparts Press and “Dedicated to the Vietnamese people.”

A typical statement was in The Real SDS Stands Up, an article by Andrew Kopkind that appeared in the June 30, 1969, issue of Hard Times, a student radical publication. Mr. Kopkind said,

But the most significant ideological force with SDS was a group of 11 New York and Midwestern activists and intellectuals who had drawn up an analytical and programmatic thesis called, simply, “You Don’t Need a Weatherman to Know Which Way the Wind Blows” (the title is from Dylan…). “Weatherman” was a 16,000-word paper which made the first and crucial attempt at defining an ideology and a program for SDS…it was the first major overhaul SDS has had since the “Port Huron Statement” and “America and the New Era”

…the paper presented this argument: Opposition to US imperialism is the major international struggle today……Those who are leading the fight are the guerrillas of the Third World (principally, now, the Vietnamese and the Latin American guevaristas) and those of the “internal” black colony within the US…

That central idea implies several consequences. First, the black liberation movement in the US is the most important element of the whole process…Second, the way in which the various foreign and domestic colonies arrive at the revolutionary stage is through their own fights for “self-determination.”…Third, the youth movement did not spring full-blown from abstract idealism, but is a specific response to the black movement and the worldwide “war” against the American empire; it must now reach out of its middle-class origins to a base in the white working class and the permanent drop-out culture…Fourth, the several community “movements” should begin to think of themselves as cadres and collectives in the first stages of formation of a revolutionary political party.

From the same volume, Look At It: America 1969, which appeared first in New Left Notes, August 1969, amplifies on this outlook:

What’s new is that today not quite so many people are confused, and a lot more people are angry; angry about the fact that promises we have heard since first grade are all jive; angry that, when you get down to it, this system is nothing but total economic and military put-down of the oppressed peoples of the world. And more: it’s a system that steals the goods, the resources and the labor of poor and working people all over the world in order to fill the pockets and bank accounts of a tiny capitalist class. (Call it imperialism)…

No longer will we tolerate “law and order” backed up by soldiers in Vietnam, and pigs in the communities and the schools; a “law and order” that serves only the interests of those in power and tries to smash the people down whenever they rise up…

We are expressing total support for the National Liberation Front of South Vietnam…We moved from individual acts of moral protest – remember the spring before, the draft card burning had been considered the very limit of the Movement – to massive attacks on the centers of military power in this country. The Pentagon and the vast Oakland Induction Center were real; in Oakland the slogan changed from “:Hell No, We Won’t Go” to “HELL NO, NOBODY GOES.”

We had begun to realize that to stop the war we had to stop the United States government…Columbia transferred to a single campus the ideas of the Pentagon: Bring Home the War. We hit where it hurts. We had moved from individual protests to attacks on the centers of power, attacks on the home ground of the war machine.

Revealing in his own words that he is a liar, Bill Ayers wrote in A Strategy To Win, appearing in New Left Notes of September 12, 1969,

…we’re going to bring the war home, we’re going to create class war in the streets and institutions of this country, and we’re going to make them pay a price…people have come to see the need to build collectives that can fight, the need to build collectives that are strong and tough, and in order to do that a lot of individualism has to be worked out of every one of us…we’re also going to make it clear that when a pig gets iced that’s a good thing, and that everyone who considers himself a revolutionary should be armed, should own a gun, should have a gun in his house.

Thomas E. Brewton is a staff writer for the New Media Alliance, Inc. The New Media Alliance is a non-profit (501c3) national coalition of writers, journalists and grass-roots media outlets.

His weblog is THE VIEW FROM 1776
http://www.thomasbrewton.com/

Email comments to viewfrom1776@thomasbrewton.com

By Thomas E. Brewton

Liberal-progressive-socialists again eagerly anticipate returning to the disastrously failed economic policies of Franklin Roosevelt. Apparently religious faith in socialism outweighs rational consideration of evidence.

The standard liberal-progressive-socialist litany is that socialism, in the New Deal and subsequent years, would have succeeded, if only the government had spent more money for a longer time.

Many liberals lament that the New Deal didn’t go far enough in socializing the economy. That was a major reason for the savage antagonism between the liberal establishment of the 1960s and the New Left student radicals like Bill Ayers and Bernadine Dohrn, the spiritual parents of president-elect Obama’s educational policies.

In addition to blind religious faith in the secular religion of socialism, liberal-progressives are beset by ignorance. For three generations, students have been taught a completely false version of the Depression’s causes and of the actual results attained by President Roosevelt’s New Deal.

Despite President Franklin Roosevelt’s devaluation of the dollar, deliberate inflation of prices, nationalization of agriculture and industry and massive deficit spending, unemployment remained in double digits. Those levels, from 1933 until our entry into World War II in 1941, were more than twice as high as our present unemployment rate. Not until the 1950s did industrial production regain the levels of 1928.

The initiating cause of the Depression was over-expansion of the money supply by the Federal Reserve during the 1920s, which led to excessive investments in farm and machinery production for export to post-World War I Europe.

Similar over-expansion of the money supply led to over-allocation of resources in fledgeling tech companies in the 1990s dot-com boom-and-bust, as well as in the housing mania and speculative lending and investing practices in the present situation.

Presidents Hoover and Roosevelt turned an ordinary business recession (which should have lasted only about two years) into the worst economic downturn in our history. They accomplished that feat by pursuing the same economic policies now urgently sought by liberal supporters of president-elect Obama.

First, by raising income taxes on individuals and businesses; taxing “the rich” and distributing receipts to favored economic and social classes.

Second, by condemning businessmen as social criminals (note current rhetoric by Senator Charles Schumer and Congressmen Henry Waxman and Barney Frank).

Third, by promoting inflation and devaluation of the dollar (Fed Chairman Bernanke and Treasury Secretary designate Timothy Geithner are neo-Keynesian, flood-the-market-with-artificial-money advocates).

Fourth, by clamping many rounds of new regulations upon business.

Fifth, by supporting socialist labor unions (see the Wall Street Journal’s interview with SEIU’s CEO Andy Stern).

Sixth, by punishing businesses that sought to reduce costs enough to enable resuming production at a profit. Major employers that reduced wages or laid off workers were threatened with Federal reprisals.

Seventh, by pursuing beggar-thy-neighbor protectionist policies (raising tariffs, or today rescinding and curbing free-trade agreements with foreign nations in order to please labor unions).

Eighth, by centralizing business management decisions in Washington bureaus (see the current possibility of bailing out the Big Three automakers and subjecting their business plans to Federal oversight).

Ninth, by making it impossible for banks to float bonds for long-term credit to support business expansion; uncertainty about what the Federal government would do next was the enemy of credit expansion (witness today, when credit markets remain frozen, because of massive flip-flops in bailout programs by the Treasury and the Fed; Bear Stearns is merged into Chase, but Lehman is allowed to go belly up; The Treasury is to buy bad assets from lenders; then, instead, it injects capital into selected banks).

Tenth, by making daily business decisions a matter of speculative chance; FDR’s New Deal came out with so many new plans, new agencies, and new regulations, month after month, that it became impossible for businessmen to make rational decisions for long-term investments that were needed to create new jobs and to ramp up the economy.

For more background, read Robert Higgs’s post on the Mises.org website, The New Deal and the Great Duration.

In A New Deal Frame of Mind (February, 2007), I wrote:

The New Dealers were a brash, cock-sure bunch who came from the academic world to Washington intending to wipe out as much of our capitalistic system as possible.  They viewed the business and financial communities as a cross between Neanderthal ignorance and evil perversity.  They assumed that all right-thinking people were united in the view that businessmen and bankers existed to oppress “the people.”

While 1950s apologists like liberal historian Arthur Schlesinger, Jr., prettied the recollections of the New Deal by describing it as “saving business from itself,” the facts show clearly that the New Dealers were rabid anti-capitalistic socialists…

Robert Higgs, in “Depression, War, and Cold War” (2006), writes:

“Accepting his party’s nomination for the presidency in 1936, Mr. Roosevelt railed against the “economic royalists” who were allegedly seeking a “new industrial dictatorship”….. Privately, he opined that “businessmen as a class were stupid, that newspapers were just as bad”…. Just before the election of 1936, in an address at Madison Square Garden, he fulminated against the magnates of “organized money…” ….To uprorious applause, he threatened: “I should like to have it said of my second Administration that in it these forces met their master.”

See also The Raw Deal (June, 2007).

Thomas E. Brewton is a staff writer for the New Media Alliance, Inc. The New Media Alliance is a non-profit (501c3) national coalition of writers, journalists and grass-roots media outlets.

His weblog is THE VIEW FROM 1776
http://www.thomasbrewton.com/

Email comments to viewfrom1776@thomasbrewton.com