Sunday, November 25, 2012

How government lies about the economy

REALITY CHECK... for those with ears to hear and eyes to see!

Exclusive: David Kupelian EXPOSES amazing financial fairy tales we're told daily

by David Kupelian

The jobless rate is DOWN. The stock market is UP. Inflation is LOW. The Fed is stimulating the economy through quantitative easing. The recovery is picking up steam.

Such daily feel-good headlines, created by the Obama administration and amplified by the press, glide pleasantly over our minds and reassure us all is well, or soon will be. But what do these headlines actually have to do with REALITY?

Often very little. The establishment media’s financial reporting is just like their reporting on politics and culture – which is to say, biased, inaccurate and misleading, sometimes intentionally so.

In fact, a great deal of what passes for “objective reporting” on the economy is little more than “laundered” press releases from the government (and other power players like the Federal Reserve) whose credibility depends on continually deceiving the public.

So, what are the government, the Fed and their media cheerleaders hiding?

Let’s begin with the unemployment rate.

A month before Election Day, the government’s official unemployment rate, after close to four years above 8 percent, surprised everyone by magically breaking through the psychological 8 percent floor with a September “jobless rate” of 7.8 percent. This welcome news was hailed by the Obama administration and its media acolytes as proof the president’s controversial spending and regulatory policies were indeed working to heal a troubled economy.

High-profile skepticism was immediate. Jack Welch, former chairman of General Electric, suggested fudged data:

“Unbelievable jobs numbers … these Chicago guys will do anything … can’t debate so change numbers,” Welch tweeted.

Real-estate billionaire Donald Trump agreed with Welch: “He’s 100 percent correct, in terms of his statement about jobs. And after the election they’ll do a big correction.”

Added Home Depot co-founder Ken Langone: “I give Jack a lot of credit for being there and standing out. It makes it easier for me because he and I share the same point of view. These numbers don’t square with what’s going on with the economy.”

The White House shot back at the skeptics, with Labor Secretary Hilda Solis protesting, “This is a methodology that’s been used for decades. And it is insulting when you hear people just cavalierly say that somehow we’re manipulating numbers.”

OK, time out. Amid all the bickering over whether the “official” unemployment rate is 8.1 percent or 7.8 percent, it’s easy to forget that all these numbers are just a fairy tale created by the government and promoted by the elite media.

“You know what the unemployment rate really is?” asked Texas Rep. Ron Paul earlier this year. “It’s probably closer to 20 percent.”

As the Washington Post reported, Paul, a popular but long-shot GOP presidential candidate during the primary season, “has long argued that the unemployment figures released by the Bureau of Labor Statistics are inaccurate and that the country has actually been in a depression for the past decade.”

Said Paul: “If you want to really know why the American people feel badly about the economy, it’s that the unemployment rate is escalating. It’s very high. But if you take … the number of people employed, 132 million people, it’s the same number that was employed in the year 2000. There have been no new jobs produced.”

And how does the government arrive at only 8 percent unemployment? Easy, just leave out lots of unemployed people from the calculations.

Let’s break it down. According to the Bureau of Labor Statistics, “In September, 2.5 million persons were marginally attached to the labor force.” Even though these individuals “wanted and were available for work, and had looked for a job sometime in the prior 12 months …

they were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.” In case you missed that: The government is openly admitting that 2.5 million unemployed Americans were not counted as officially “unemployed.”

That’s just for starters. The government’s “official” unemployment stats also don’t include part-time workers who want and need full-time work. As the PolicyMic.com blog summarized, the Bureau of Labor Statistics’ 7.8 percent figure “does not include unemployed members of the workforce who are not actively looking for work;

nor does it factor in workers with part-time jobs who are seeking full-time employment. When these workers are included, the (U-6) un/underemployment rate for September remained at 14.7 percent as it had been in August.”

In an article titled “The Real Unemployment Rate,” Fox Business News analyst Elizabeth MacDonald does the math and arrives at virtually the same number: 14.5 percent unemployment.

And Mortimer Zuckerman, U.S. News & World Report’s editor in chief, writes: “Given that the median period of unemployment is now in the range of five months, vast numbers who want to work are just not counted. If we include, as we should, people who have applied for a job in the last 12 months, and those employed part time who want full-time work, the real unemployment number is closer to 15 percent.”

In short, America’s actual unemployment rate is almost double the “official” fairy-tale number.

What about inflation?

“Inflation: Not as low as you think” was CBS Money Watch’s disconcerting headline earlier this year.

“Forget the modest 3.1 percent rise in the Consumer Price Index, the government’s widely used measure of inflation,” the article began. “Everyday prices are up some 8 percent over the past year, according to the American Institute for Economic Research.”

The not-for-profit research group measures inflation, not by the academic theories preferred by government economists, but by focusing on Americans’ daily purchases of food, gasoline, prescription drugs, phone service, television programming and all the other things most people actually buy on a regular basis.

The group’s index measures the real-world impact of price increases, particularly for people living on a tight budget. Thus, reported CBS, “largely as the result of the recent run-up in gas prices, this ‘everyday price index’ (EPI) suggests that Americans are being pinched far more tightly than the official inflation measure would have you believe.”

Indeed, most people are astonished to learn the government excludes from its “cost of living” calculations food and gasoline – both necessities of life and both skyrocketing in price. How, they wonder, can the most necessary of all household purchases be left out of the calculation? Bloomberg Television commentator and equities analyst Barry Ritholtz humorously sums up the government’s game: “If you take everything out of the CPI basket that’s going up in price, sure, you have no inflation!”

Just as with unemployment, the government’s under-reporting of inflation is no accident, notes economist John Williams, who exposes the government’s deceptive inflation and other financial statistics on his popular website, ShadowStats.

The consumer price index, or CPI, is the broadest measure of consumer price inflation for goods and services published by the Bureau of Labor Statistics. Currently it is hovering around 2-3 percent, according to the government’s official reckoning. However, charges Williams, to keep the “official” inflation rate as low as possible, the government has actually redefined the way it calculates inflation at least twice in recent decades.

ShadowStats uses the government’s own statistics, as well as the formulas it formerly employed for calculating key indicators, to show what the current inflation rate would be if calculated as it was a few years ago.

“In 30 years as a private consulting economist,” said Williams, “I have noted a growing gap between government reporting of inflation, as measured by the consumer price index, and the perceptions of inflation held by the general public. It has been my experience that the general public believes inflation is running well above official reporting, and that the public’s perceptions tend to mirror the inflation experience that once was reflected in the government’s CPI reporting.”

This growing difference between public perception and the government’s “official” inflation rate, explained Williams, “primarily is due to changes made over decades as to how the CPI is calculated and defined by the government. Specifically, changes made to the definition of CPI methodologies in recent decades have reflected theoretical constructs offered by academia that have little relevance to the real-world use of the CPI by the general public. Importantly, these changes generally are not understood by the public.”

Putting it even more candidly, Williams said, “the reporting system increasingly succumbed to pressures from miscreant politicians, who were and are intent upon stealing income from Social Security recipients without ever taking the issue of reduced entitlement payments before the public or Congress for approval.”

Courtesy of ShadowStats.com

The top consumer price index chart reflects ShadowStats’ estimate of real inflation for today, using the government’s own numbers, but calculating the CPI the way the government did it in 1990.

Courtesy of ShadowStats.com

The second chart is today’s CPI calculated using the government’s methodologies in place in 1980.

Why does the consumer price index matter anyway, and why would the government want the CPI to be as low as possible, regardless of the economic realities facing Americans?

As MyMoneyBlog.com explains it, there are plenty of good reasons, at least from the government’s point of view:

Payouts on inflation-protected investments like TIPS (Treasury Inflation-Protected Securities) and Series I bonds are indexed directly to the CPI.

Social Security payments, pensions and inflation-indexed annuities all rely on CPI data to determine their annual adjustments.

The size of individual income tax brackets, personal exemptions and the standard deduction are tied to movements in the CPI.

Low inflation numbers (especially when they are much less than GDP growth) make the economy seem healthy.

So, how did government change the definition of inflation? Once upon a time, determining consumer inflation was accomplished by measuring the cost of maintaining a constant standard of living, as measured by a “fixed basket of goods” that everybody needed and purchased. Makes sense, right?

“Maintaining a constant standard of living, however, is a concept not popular in current economic literature,” said Williams, “and certainly not within the thinking or the lexicon of the Bureau of Labor Statistics, the government’s statistical agency that estimates and reports on consumer inflation.”

The old CPI concept of measuring the changing costs of maintaining a constant standard of living by tracking the costs of a fixed basket of goods and services was how government estimated inflation “going back to at least the 1700s,” said Williams, “and prior to 1945, the fixed-basket CPI tracked by the U.S. government actually was known as the Cost of Living Index.”

But during the first half of the 20th century, academics came up with a brand-new concept – that of a “constant level of satisfaction” – to gauge the “true cost of living.” Thus, if people were willing to substitute less expensive goods – like hamburger in place of the steak they previously ate – the academics’ argument was that consumers would be OK with the substitution and that no reportable price inflation would therefore have occurred even though steak became so expensive people bought hamburger instead.

To the average person, such reasoning is both absurd and dishonest.

In reality, “maintaining a constant standard of living means being able to consume the same goods in the same quantity, without having to trade-off living quality versus price,” observed Williams.

Thus, during the Clinton era, politicians got their wish and the CPI was recalculated to bring the percentage rate down. Williams revisits the history:

In the early-1990s, political Washington moved to change the nature of the CPI. The contention was that the CPI overstated inflation (it did not allow substitution of less-expensive hamburger for more-expensive steak). Both sides of the aisle and the financial media touted the benefits of a “more-accurate” CPI, one that would allow the substitution of goods and services.

The plan was to reduce cost-of-living adjustments for government payments to Social Security recipients, etc. The cuts in reported inflation were an effort to reduce the federal deficit without anyone in Congress having to do the politically impossible: to vote against Social Security. The changes afoot were publicized, albeit under the cover of academic theories. Few in the public paid any attention.

One who paid a great deal of attention is Ron Paul. Earlier this year, he confronted Ben Bernanke during the Fed chairman’s testimony before the House Financial Services Committee, on which Paul sits:

“This argument that the prices are going up about 2 percent,” Paul told Bernanke, “Nobody believes it. You know, and the old CPI says prices are going up by 9 percent, so they believe this. People on fixed incomes, they’re really hurting. The middle class is really hurting because their inflation rate is very much higher than the government tries to tell them. And that’s why they lose trust in government.”

Malignant money

Why does the U.S. government engage in blatant, continual deception regarding the true state of the economy?

The truth is, such statistical duplicity by the government and its media handmaidens, shameful as it is, is relatively minor compared to the truly terrible thing the U.S. government has done to America’s monetary system.

Consider: Most Americans today recognize that the federal government has become a gigantic, malignant cancer. That’s barely a metaphor – government literally has become a parasitic growth on a once-healthy body politic, drawing substance and energy from it, ravaging the healthy “cells” (productive individuals, families and businesses) in order to feed a malignancy so ravenous it threatens the very life of the “host organism,” America.

But all this could not have happened without the “food” of fiat money.

There was a time when the nation had an honest, constitutional monetary system backed by gold and silver. (“No State shall … make any Thing but gold and silver Coin a Tender in Payment of Debts,” says Article 1, Section 10 of the U.S. Constitution.) This, all by itself, constituted a massive barrier to the unrestrained growth of government, since one cannot create gold or silver with a printing press.

All that changed in 1913, when under the presidential leadership of progressive Democrat Woodrow Wilson, Congress passed the Federal Reserve Act. Pushed through on Dec. 23, the night before Christmas Eve, and largely along party lines (only two House Democrats voted nay and none did so in the Senate), Wilson immediately signed it into law.

This was a blatant violation of the Constitution, which specifies in Article I, Section 8 that “The Congress” – not some private banking cartel – “shall have Power … To coin Money, [and] regulate the Value thereof.” From that point, it was all downhill.

For the next two decades, until 1933, Federal Reserve notes were still redeemable in gold and silver, until President Franklin Delano Roosevelt outlawed private ownership of gold. Between then and 1963, all Federal Reserve notes were redeemable in “lawful money,” which by then meant only silver.

As author W. Cleon Skouson explains in “The Making of America,” the nation’s money – once considered “as good as gold” – continued on its path of gradual degradation:

In 1965, President Lyndon Johnson authorized the Treasury to begin issuing debased “sandwich” dimes and quarters with little or no intrinsic value, and the quantity of silver in fifty-cent pieces was reduced to 40 percent.

On June 24, 1968, President Johnson issued a proclamation that henceforth Federal Reserve silver certificates were merely fiat legal tender and could not be redeemed in silver.

On Dec. 31, 1970, President Richard Nixon authorized the Treasury to issue debased “sandwich” dollars and half dollars.

By August 1971, many of the European countries had collected so many billions in Eurodollars (foreign aid, money spent by the U.S. military abroad, etc.) that European banks had begun to get nervous about redeeming their money in gold. A threatened run on the U.S. Treasury resulted in the American gold window being slammed shut. This resulted in collapse of the dollar on the world market. Since then it has fluctuated on the world market like any other commodity, since it is no longer redeemable in precious metal and therefore has no intrinsic value.

In 1973, the U.S. dollar was officially devalued, changing the price of gold from $35 per ounce to $42.23 per ounce.

On March 16, 1973, Congress set the American dollar completely afloat with nothing to back it up but the declaration of the government that it was “legal tender,” or fiat currency. The world market immediately reflected serious erosion in the value of the American dollar.

Hit the pause button. Let’s take a moment to understand what Nixon really accomplished in his disastrous effort – which, by the way, was supposed to be only “temporary” – to protect America’s gold reserves from a European run on the U.S. Treasury.

In “Nixon’s Colossal Monetary Error,” Forbes columnist Charles Kadlec explained that “breaking the solemn promise that a dollar was worth 1/35th of an ounce of gold doomed his presidency, and marked the beginning of the worst 40 years in American economic history.”

Nixon’s ill-fated 1971 promises to the nation, made with great ceremony from the Oval Office, wrote Kadlec, “were profound and reflected the received wisdom of that day and today”:

Unshackling the U.S. government from the requirement of maintaining the dollar’s value in terms of gold would empower able men and women at the Federal Reserve to use monetary policy to increase the general prosperity of the American people.

Domestically, we were promised that the manipulation of quantity and value of a paper dollar would avoid costly recessions, provide high employment, and produce strong economic growth. Internationally, we were promised that the devaluation of the dollar would reduce our trade deficit and improve the international competitiveness of American workers and businesses. And, because trade was only one-tenth of the U.S. economy, all of this could be done while maintaining price stability.

Each and every one of these promises has been broken.

Indeed, ever since Nixon ended the gold standard, unemployment has surged and the nation has suffered the three worst recessions since the end of World War II. This compares disastrously to the post-World War II gold-standard era between 1947 and 1970, Kadlec explains:

Since able men and women were given the power to manipulate the quantity and value of the dollar, real economic growth has averaged 2.9 percent a year – more than a full percentage point slower than the 4 percent growth rate during the post-World War II gold-standard era.

A 1 percent difference may not seem like much, but in reality it is the difference between prosperity and austerity. A growth rate of 3 percent creates just enough jobs for all new workers. A growth rate of 4 percent yields higher employment and a decline in the unemployment rate.

Worst of all, writes Kadlec, the U.S. dollar has fallen disastrously in value: “Today, the dollar is worth less than two dimes in buying power compared to the pre-Nixon dollar. And, with little reason to believe that the dollar will maintain even this paltry value, the average American family is left with no meaningful way to save for their children’s education or their own retirement. We experience all of this in the form of financial insecurity and well-grounded anxiety about the future.”

The ultimate wealth-redistribution engine

America is burdened today with the twin curses of a corrupt, out-of-control government and a corrupt, unaccountable monetary and banking system, each enabling the other in symbiotic fashion. The government needs a central banking system willing and able to create gargantuan amounts of money out of nothing, “lending” it to the government through various schemes, enabling it to grow uncontrollably, while inflating the currency and thereby stealing citizens’ wealth through constant dollar devaluation. President Reagan warned about this when he said, “Inflation is as violent as a mugger, as frightening as an armed robber and as deadly as a hit man.”

This mutual arrangement between government and the central bank, in turn, awards huge power, wealth and influence to an unaccountable private banking cartel – deceptively labeled “Federal” even though it is not part of the government. The bank bailouts of recent years prove that the Fed, its secret stockholders, and the entire banking establishment have become “too big to fail,” their downside risk always borne by taxpayers, while the massive upside benefit accrues to them alone.

The manner in which the Fed operates – how it issues fiat money only through creating debt, then charges interest on what are nothing more than computer entries, and intentionally promotes inflation (2 percent per year is the Fed’s current “target rate”), which steals a major portion of Americans’ wealth every generation – has been rendered needlessly complex and labyrinthine so as to shield these predatory and unconstitutional practices from public comprehension.

Small wonder that today’s bipartisan congressional calls to audit the Fed are met with refusals and thinly veiled threats from its current chairman, Ben Bernanke.

Bottom line: A corrupt banking system has become the handmaiden, the primary enabler – the “crack dealer,” so to speak – of an out-of-control government addicted to spending. Unfortunately, the long-term result of this is the destruction of the productive middle class, which is the source of the wealth government is so obsessed with redistributing.

This is why many enlightened monetary historians advise Americans to free themselves from “the matrix” of fiat currency by owning precious metals, which have served as “real money” the world over for the past 5,000 years. The greater the number of citizens that make a point of owning some gold and/or silver, they say, as opposed to exclusively paper assets, the better chance the great middle class has of surviving the future with most of its wealth intact. Anticipating that government will be forced to radically inflate the currency to pay its debts, one analyst, Mike Maloney, advises Americans to prepare individually for “the greatest wealth transfer in history” in the next few years.

Remember, today’s “dollar bill” purchases what 3 cents would buy in 1913 when the Federal Reserve was created to “stabilize” our money system.

So where do we go from here?

Things are quite a bit worse than most people realize, economically. The world is abandoning the increasingly unreliable U.S. dollar as its reserve currency. America’s credit has been downgraded and faces further threatened downgrades. The national debt of over $16 trillion, when added to government’s future liabilities that some peg at $200 trillion, simply cannot be paid. If nothing changes, America’s children will grow up inheriting national insolvency and huge personal financial burdens of our making.

There are really ONLY a few possible answers:

1. Continue to put off the day of reckoning by borrowing much more money from adversary nations like China (but they too are facing economic chaos). That’s obviously NOT the right choice.

2. Raise taxes dramatically in the middle of a prolonged recession. That’s ALSO a bad idea.

3. Get the Federal Reserve to create mountains of new money out of THIN AIR and use it to pay our debtors with WORTHLESS dollars. That could be accomplished very quickly, but it would mean saddling Americans with ruinous HYPERINFLATION and wiping out the accumulated wealth and savings of the WHOLE country.

None of these solutions have a happy ending.

Oh wait, there is one more possibility.

4. Face the music, stop “kicking the can down the road,” ignore the perverse “mainstream media” and legions of spoiled crybabies addicted to government freebies and set about the difficult but noble and ultimately liberating task of cutting government back to its constitutionally authorized size. Especially, ABOLISH the Federal Reserve and return the power of creating money to Congress, reinstate the gold standard and eliminate many of the enormous, parasitic, unconstitutional bureaucracies that fill the nation’s capital.

If we do this, if we finally repudiate the “fairy tale economy,” and once again embrace wholeheartedly the founding legal, economic, cultural and spiritual principles that made America the greatest nation on earth, then we will bequeath to our children a nation in which they truly can live happily ever after.

Reprinted from the November issue of WND’s monthly Whistleblower magazine, “THE FAIRY TALE ECONOMY.” Find out more about Whistleblower.

David Kupelian is an award-winning journalist, managing editor of WND, editor of Whistleblower magazine, and author of the best-selling book, The Marketing of Evil His newest book, How Evil Works, released to much critical acclaim in the spring of 2010.


Attribution Source:

http://www.wnd.com/2012/11/how-government-lies-about-the-economy/

The Two Real Parties: The Hamiltonians And The Jeffersonians

By  
 


The two opposing political philosophies being debated in 2012 can be traced back to George Washington’s presidency.  Alexander Hamilton, Washington’s Secretary of the Treasury and a Federalist,  offered an economic plan that CREATED a centralized bank (First Bank of the United States), imposed trade tariffs and exise taxes, and had the federal government assume all of the states’ debt. 

He justified government expansion by referring to implied powers implicit in the Constitution. Former Federalist Thomas Jefferson OPPOSED the expansion of government,  supported STATES RIGHTS, and followed a more explicit interpretation of the Constitution with strict LIMITATIONS on federal government. Eventually, Jefferson’s side formed a party referred to by historians and people of the time AS Republicans, but known today as Democratic-Republicans. Hamilton and Jefferson are the patrons of the two OPPOSING American political philosophies of big government vs. small government.

ahamilton 65 The Two Real Parties: The Hamiltonians And The Jeffersonians
President Washington didn’t openly join either side, but he supported Hamilton’s policies as his Treasurer. Both the House and Senate were pro-administration (Federalist) throughout Washington’s presidency and remained Federalist through John Adam’s (also a Federalist) presidency. During this period, there was a financial crisis in 1792 when Hamilton BAILED OUT the Bank of New York, the bank HE started, through providing securities that brought the price of securities down by 24%. There was also a land speculation bubble that burst in 1796.
From 1800 to 1825, the Democratic-Republicans dominated Congress. 

The charter of the First Bank of The United States EXPIRED in 1811 and WASN'T renewed. After the Nepoleanic wars ended, there was an ”Era of Good Feelings”, where there was a general feeling of Unity between all politicians as the Federalist party faded into history. There was basically a diluted, moderate Democratic-Republican party. The Second Bank of  The United States was chartered in 1817 as a reaction to the difficulties in financing the War of 1812. After the panic of 1819, however, politicians split into Hamiltonian and Jeffersonian factions again OVER THE EXISTENCE of a centralized bank.

The Democrats emerged as the Jeffersonian Party; and the National Republicans, who later became Whigs, favored Hamiltonian policy. The Jeffersonian Democrats dominated the presidency and both houses until 1860.  After the charter for the Second Bank of The United States was ALLOWED TO EXPIRE by Jackson’s administration in 1837, there was a contraction and a five-year long depression. Despite this economic downturn (and a brief surge in Whig popularity),  there was NO CENTRAL BANK again until 1913.  There was another panic that spread from Great Britain’s central bank in 1857, but the economy quickly recovered after President Buchanan (Jeffersonian Democrat)  lowered tariffs and WITHDREW government usage of bank notes. The panic leveled out and was over by 1859.

In 1854, a new Republican Party formed from the remnants of the Whigs (as did other abolitionist third parties to fight slavery.) The Republicans DOMINATED Congress and the presidency until 1885. After the war, they became  the representatives of Hamilton’s philosophies.  In order to fund the Civil War, the US government LEFT the gold standard and created greenbacks, or legal tender FIAT CURRENCY that was not readily redeemable in gold. As a result of the war,  the transition back to the gold standard, and Republican protectionist tariffs, the growth of the American industrial revolution was slowed in what is known as the long depression between 1873 and 1896.

Theodore Roosevelt and Woodrow Wilson BOTH took Hamiltonian policy to a new level in the early 1900s. Much like our last two presidents, their party affiliation was nominal.  They introduced progressivism and government ACTIVISM throughout their presidency, pushing antitrust laws and new departments like the ICC, as well as REINSTATING a central bank and INTRODUCING the income tax. Party members from both sides opposed certain aspects of the activism and supported others. Pure Jeffersonian policies were ABANDONED. There was a panic in 1907 that was in recovery by 1908 during Roosevelt’s presidency. During Wilson’s presidency, we entered WWI and IMPOSED a  top income tax rate of  73%, when just seven years before there was NO income tax at all. This led to a crash in 1920.

After the heavy government expansion of the progressive era and the crash that resulted, there was a BACKLASH and a REDEFINING of the parties once again. After Wilson’s administration, politicians who favored Hamiltonian policy aligned themselves with the Democrats, while Jeffersonian policies were REVIVED d by the Republicans. The next two presidents, Harding and Coolidge, were Jeffersonian Republicans backed by Republican Congresses throughout their terms. They CUT taxes and REDUCED  government. This policy led to the roaring twenties. The roaring twenties ended with a crash in 1929.


A month after the stock market crash, the market bottomed out and began to make a recovery. After unemployment went from 9% in November of 1929 to 6% in June of 1930, WITHOUT any government interference, Hoover decided to COMPROMISE with Hamiltonian principle and urge wage controls AND protectionist tariffs. The Republican Congress went along. The market quickly turned south again; and the more Hoover did to help, the WORSE it got.

After Hoover and the Republicans’ failures with the recovery, the Democrats took over BOTH houses of Congress and the Presidency with Franklin Roosevelt.  Roosevelt began what he called MODERN liberalism based on the NEW Keynesian economic model. Modern liberalism was and IS Hamiltonian progressivism on steroids. MASSIVE government regulation, price controls, and protective trade tariffs led to a depression that only ended after those policies were SCRAPPED for the WWII war effort over ten years later.

After the Great Depression and World War II, Americans in general had HAD ENOUGH OF big government. There was NO PROPER PLAN to handle the switch to a peacetime economy. The removal of some price controls  resulted in inflation and some of the BIGGEST public sector union strikes in history, while remaining agricultural PRICE CONTROLS led to farmers REFUSING to sell grain in 1945 and 1946. The chaos resulted in Congress being lost to the Republicans in 1946 for the first time since 1930.  Anti-union legislation as well as tax cuts were passed by this Congress by OVERRIDING Truman’s vetoes.  Truman was in trouble in the 1948 election, so he convinced fellow Democrats at the convention to support MORE civil rights policies to muster support for Hamiltonian policy, despite Southern Democrat objections. He won the Presidency, and the Democrats won back Congressional control. 

During Truman’s second term, he began integration in the military and made discrimination against public service employees illegal. Beyond that, Truman’s second term was RIFE with CORRUPTION and CRONYISM in the IRB (the predecessor to the IRS) and court appointees, Union Strikes, and unrest from continued price controls, as well as a war in Korea that was NOT declared by Congress.  Truman lost the nomination to run again in 1952. There was a recession in 1949, shortly after Truman’s Fair Deal was enacted and the Federal Reserve TIGHTENED the money supply. After The Korean War, more inflation was expected, so the Federal Reserve implemented a more restrictive monetary policy than necessary, leading to a recession in 1953.

Republican Dwight Eisenhower won the presidency, and the Republicans won the majority in both houses of Congress in 1952.  Eisenhower returned to a financially responsible, progressive Hamiltonian Republican policy and blamed the Old Guard of the Republican party for being too inflexible. He lost both houses of Congress to the Democrats in 1954. Democrats maintained their majority in both houses until 1980. Although he REMOVED wage and price controls and cut back remaining New Deal legislation, ended the Korean War, and balanced the budget,  he also EXPANDED Social Security and proposed the Interstate Highway System.  It was the Eisenhower administration that effectively BEGAN the marginalization of Jeffersonian Republicanism for responsible Hamiltonianism. There were two short, minor recessions in 1958 and 1960 that resulted from the Federal Reserve’s attempts to avoid economic difficulties.

John F. Kennedy and Lyndon B. Johnson enjoyed a Democrat-controlled Congress throughout both of their presidencies. Kennedy RETURNED TO Keynsianism, loosening monetary policy and INCREASING government spending to create our FIRST non-war, non-recession deficit. Kennedy’s policies resulted in the fastest growth in American history up until that point.  Johnson continued and expanded Kennedy’s policies by CREATING The Great Society. The Great Society was a DRAMATIC expansion of government control. Everything from Medicare and Medicaid to current education policy to arts endowments, welfare, urban renewal, and even heavy environmental  policies was all born DURING Johnson’s administration. The bubble created by Keynsian policies led to an economic slump that started in 1966 and led to the WORST inflation in a century. Johnson didn’t seek re-election.

Richard Nixon beat Hubert Humphrey in 1968, but both Houses of Congress remained Democrat throughout his administration. Nixon was a Hamiltonian Republican who created a “NEW Federalism”. He REDUCED the power of states, LIFTED the gold standard, and put wage and price controls IN place. His policies were a temporary fix, and high inflation returned with a VENGEANCE accompanied by rising unemployment at the END of his presidency.

Gerald Ford assumed the presidency in 1974 after Nixon resigned. He was ANOTHER Hamiltonian Republican who saw a short presidency with a Democrat-controlled Congress. Ford CONTINUED the tradition of government spending, which INCREASED  the deficit and had no discernible effect on inflation or unemployment.

Jimmy Carter was a Hamiltonian Democrat elected in 1976.  Carter also had a Democrat majority in both houses of Congress. He TRIED following Ford’s policies, then REVERSING them, leading to a new economic phenomenon called stagflation (or high inflation and high unemployment at the same time resulting from the erratic policies.) The economy progressively got worse, leading to a  shift from Democrat to Republican control in the Senate and the Presidency, for the first time since 1952, in 1980.

The FIRST Jeffersonian Republican President since Calvin Coolidge was elected in 1980. Ronald Reagan enjoyed the ONLY three Republican majority houses of Congress elected between 1954 and 1994.  All three were Senates. He CUT funding of government programs and LOWERED taxes. The freeing up of the economy led to a DEEP recession that lasted until 1982, followed by a ROBUST RECOVERY that didn’t see another recession until 1990, even with greatly increased defense spending  to push the Soviet Union to bankruptcy.

George Bush Sr. was a Hamiltonian Republican elected in 1988. He GAVE INTO the demands of the Democrat majority in Congress during his presidency; this led to a PROLONGED recession and made Bush a one term President.

In 1992, Democrat Bill Clinton was elected with a Democrat majority in both houses of Congress. Clinton claimed to be a Centrist who followed responsible Hamiltonian policy OVER the Keynesian policies of the FDR Democrats. He went TOO FAR with a push for more strict gun control laws AND universal healthcare, however, and lost The House of Representatives for the FIRST TIME in forty years and the Senate for the FIRST TIME in eight. Congress remained Republican until 2006. Huge advancements in technology and deregulation  led to Clinton being President during the biggest technological boom in history. It was blown up into a bubble through The Federal Reserve keeping interest rates ARTIFICIALLY LOW, leading to over-investment. The bubble BURST during his last year as president in 2000 after the Federal Reserve brought interest rates back up.

George W. Bush became President in 2000. He was a Hamiltonian Republican with a Republican majority in both houses of Congress for the first 3/4 of his term. Together, they INCREASED SPENDING  more than any administration SINCE Lyndon Johnson. The Federal Reserve lowered interest rates to counter the recession of 2000 while legislation was PASSED for the government to INSURE risky mortgages to help more people own homes. This rebirth of Keynesianism led to a housing bubble that BURST in 2007. The recession lasted until the end of Bush’s presidency, DESPITE   bailouts in 2008.

Barack Obama was elected in 2008, along with a Democrat majority in both houses. Barack Obama is a Hamiltonian Democrat who, along with his Democrat Congress, ALSO followed the Keynesian policies of Bush. The economy continued to get worse until 2010. In 2010, The House of Representatives as well as MANY state legislatures were taken over by a NEW Jeffersonian Republican movement referred to as the TEA PARTY. (Of course, we all know what happened in the couple of years that followed.)

I hope you see how important it is to return to the small government Jeffersonian policies that have proven to have MORE beneficial effects on the economy and the quality of life for all Americans.

 ATTRIBUTION SOURCE:

http://www.westernjournalism.com/the-two-real-parties-the-hamiltonians-and-the-jeffersonians/

Wednesday, November 21, 2012

GOP legally barred from fighting vote fraud

30 years later, consent decree violation claims still threaten

by Bob Unruh

Voting machines suspiciously defaulting to Barack Obama? Buses loaded with strangers appearing at polling stations? Even ballots turning out 100 percent for one candidate in precinct reports?

In short, suspicions of vote fraud?

That’s too bad, because a race-based CONSENT DECREE negotiated by Democrats against the Republican National Committee a generation ago STILL has tied the RNC’s hands, and GOP officials could be cited for CONTEMPT – or worse – if they try to make sure American elections are clean.

Impossible?

No. Fact.

The case is the Democratic National Committee vs. the Republican National Committee, originally from 1982.

Democrats alleged Republicans were trying intimidate minority voters in New Jersey and brought the legal action. The RNC, inexplicably, decided to AGREE to a consent decree before a Democrat-appointed judge RATHER THAN fight the claims.

The judge, Dickinson Debevoise, appointed by Jimmy Carter, later retired but decided he would continue to control the case. The decision REQUIRES the RNC – but NOT the DNC – to “refrain FROM undertaking any ballot security activities in polling places or election districts where the racial or ethnic composition of such districts is a factor in the decision to conduct, or the actual conduct of, such activities there and where a purpose or significant effect of such activities is to deter qualified voters from voting; and the conduct of such activities disproportionately in or directed toward districts that have a substantial proportion of racial or ethnic populations shall be considered relevant evidence of the existence of such a factor and purpose.”

The rest of the agreement essentially requires the RNC to follow applicable state and federal election laws.

But the section cited above has been used for decades to WARN OFF Republicans from any challenge to EVIDENCE OF VOTER FRAUD in districts with “racial or ethnic populations.”

The law has REMAINED, even though the RNC recently challenged it at the appellate level only to be turned down by Judges Joseph Greenaway Jr., appointed by Bill Clinton; Dolores Sloviter, appointed by Carter; and Walter Stapleton, appointed by Ronald Reagan, in the 3rd U.S. Circuit Court of Appeals.

It now is PENDING before the U.S. Supreme Court.

But two election veterans both told WND it STILL IS HURTING the fight against voter fraud in the United States.

Attorney James Bopp of the James Madison Center said the threat that the RNC has faced is that someone will ALLEGE a violation of the decree, and party officials will be standing in a courtroom on Election Day.

Bopp’s organization was founded to protect the First Amendment right of ALL citizens of free expression and “to support litigation and public education activities in order to DEFEND THE RIGHTS of political expression and association by citizens and citizen groups as guaranteed by the First Amendment of the United States Constitution.”

Bopp himself has taken part in more than 60 election-related cases, including recounts, redistricting and constitutional law challenges to state and federal election laws.

He said the agreement even today, amid reports of fraud across the country, PREVENTS the RNC from doing ANY anti-voter fraud activity on Election Day.

“It is way too restrictive,” he said. “It PREVENTS the RNC from working with state parties in conducting voter integrity activities. It has been used by the DNC to HARASS the leadership of the RNC with FALSE ALLEGATIONS of violations of the consent decree.”

He said the reason why the RNC originally agreed to the decree, RATHER THAN fight the allegations, was unclear. But he said he investigated the issue.

“It was VERY TROUBLING that the RNC’s effort to ensure the integrity of the vote would be undermined,” he told WND.

While there have been periods in U.S. history in which there have been concerns about minority voting, the restrictions TODAY, he said, are “completely unjustified.”

“It’s become ABSURD,” he said, noting that besides a president who had a black father, and a black attorney general, the GOP ALSO has had a black chairman.

Voters, he said, would be best served to have BOTH political parties watching for vote fraud.

Also responding to questions about the issue was Cleta Mitchell of the Washington firm of Foley & Lardner.

Mitchell is on the firm’s political law practice team and has 30 years of experience in law, politics and public policy, advising candidates, campaigns and others on state and federal campaign finance law, election law and compliance issues. She practices before the Federal Election Commission.

“The RNC has been COMPLETELY PROHIBITED from doing anything in ballot security since 1982,” she told WND. “The Democrats repeatedly over the years have gotten the RNC officers into court on the weekend BEFORE the election.

“What it means is that for 30 years there has been NO WAY to institutionalize, to help train state parties, to work with candidates [on vote fraud prevention issues],” she said.

Problems can be caused by malfunctioning equipment, programming errors, or “sheer incompetence” of local elections officials, she said. And sometimes by vote fraud.

“The problem is there’s nothing that the RNC can do in that regard BECAUSE OF that consent degree,” Mitchell said. “A lot of things need to be done to improve state laws. … Democrats are able to be involved as they want to be.”

Republicans have TRIED to change the decree since 2009, after Obama took office. But Debevoise has ruled that they FAILED TO SHOW that conditions in the U.S. had changed since 1982.

Debevoise said that since most minority voters SUPPORT Democrats, the RNC still has an incentive to suppress minority votes.

He DISMISSED the idea of voter fraud and extended his own supervision of the case until 2017.

In March, the 3rd Circuit issued its affirmation of Debevoise’s decision.

At one political blog, called Politijim, the suspicion flowed.

“Obama only won by 400,000 votes in four states. ALL of which showed Romney ahead in the days leading up to the election, but LOSING by a substantial margin. All of which have precincts that inexplicably went 99 percent for Obama and had voter registrations that EXCEEDED their population. ALL of which have public statements of problems with voting machines CHANGING Romney votes to Obama,” the blog accused.

WND recently has reported on allegations of voter fraud, including a claim by a poll watcher in Pennsylvania who said votes REVERTED TO OBAMA BY DEFAULT, no matter who the voter selected.

The incident took place in the state where officials claimed Obama received a total of 19,605 votes in 59 voting divisions to zero for Mitt Romney and not far from the 100 precincts in Ohio in which Obama got 99 percent of the vote.

With evidence mounting that the vote tabulation did NOT reflect the true choices of voters, talk-radio icon Rush Limbaugh declared: “Third-world, tin-horn dictators don’t get [these percentages]. I mean, the last guy that got this percentage of the vote was Saddam Hussein, and the people that DIDN'T vote for him got shot. This just doesn’t happen. Even Hugo Chavez [of Venezuela] doesn’t get 100 percent or 99 percent of the vote.”

It was in Upper Macungie Township, near Allentown, Pa., where an auditor, Robert Ashcroft, was dispatched by Republicans to monitor the vote on Election Day. He said THE software he observed would “change the selection back to default – to Obama.”

BOB UNRUH joined WND in 2006 after nearly three decades with the Associated Press, as well as several Upper Midwest newspapers, where he covered everything from legislative battles and sports to tornadoes and homicidal survivalists. He is also a photographer whose scenic work has been used commercially.
 
 ATTRIBUTION SOURCE:
http://www.wnd.com/2012/11/gop-legally-barred-from-fighting-vote-fraud/

Tuesday, November 20, 2012

The Articles of Confederation E-book

GET A FREE COPY OF “THE ARTICLES OF CONFEDERATION”
The mission of the Federalist Papers Project is to educate Americans on the principles of government that turned our country into the greatest, richest and most powerful country in the history of the planet while remaining a beacon for freedom and opportunity.

In this 15 page booklet is an analysis of the strengths and weaknesses of the Articles of Confederation and the full text of the original document.Get your FREE copy of “The Articles of Confederation” 
 
To download your copy of “The Articles of Confederation” please right mouse click on the link, then select “save as” and download to your computer -  The-Articles-of-Confederation

ATTRIBUTION SOURCE:

http://www.thefederalistpapers.org/founding-documents/the-articles-of-confederation-e-book

Capretta and Levin: Why ObamaCare Is Still No Sure Thing


The majority of state governors are Republicans, and they have the power to disarm the health-care law.

Champions of ObamaCare want Americans to believe that the president's re-election ended the battle over the law. It did no such thing. The Patient Protection and Affordable Care Act won't be fully repealed while Barack Obama is in office, but the administration is heavily dependent on the states for its implementation. 

Republicans will hold 30 governorships starting in January, and at last week's meeting of the Republican Governors Association they made it clear that they remain highly critical of the health law. Some Republican governors—including incoming RGA Chairman Bobby Jindal of Louisiana, Ohio's John Kasich, Wisconsin's Scott Walker and Maine's Paul LePage—have already said they won't do the federal government's bidding. Several Democratic governors, including Missouri's Jay Nixon and West Virginia's Earl Ray Tomblin, have also expressed serious concerns. 

Talk of the law's inevitability is intended to pressure these governors into implementing it on the administration's behalf. But states still have two key choices to make that together will put them in the driver's seat: whether to create state health-insurance exchanges, and whether to expand Medicaid. They should say "no" to both. 

At its core, ObamaCare is a massive entitlement expansion. Between vastly increased Medicaid eligibility and new premium subsidies, it is expected to bring 30 million more people onto the federal government's entitlement rolls. The law anticipates that the states will take on the burden of implementing the expansions, but states can opt out of both.

Running the exchanges would be an administrative nightmare for states, requiring a complicated set of rules, mandates, databases and interfaces to establish eligibility, funnel subsidies, and facilitate purchases. All of this would have to take place under broad and often incoherent statutory requirements and federal regulations that have yet to be written.

 They are on opposite sides of ObamaCare, but President Obama and Louisiana Gov. Bobby Jindal met in September in LaPlace, La., for a briefing regarding Hurricane Isaac.

The exchanges would create unsustainable pressures on each state's insurance market, treating similarly situated people differently by providing far greater subsidies for those in the exchanges than those in employer plans—yielding perverse incentives that distort consumer and employer decisions and increase costs.

States would endure all this simply to become functionaries of the federal government. The idea that creating state exchanges would give states control over their insurance markets is a fantasy. The states would be enforcing a federal law and federal regulations, with very little room for independent judgment. 

Governors know this. A group of them has already indicated that they will not build the exchanges, and several more seemed ready to opt out as the administration's deadline for state decisions approached on Nov. 16. Predictably, Health and Human Services Secretary Kathleen Sebelius tried to head them off by extending the deadline to Dec. 14. She will try to use the extra month to twist governors' arms. They should resist

By declining to build exchanges, the states would pass the burden and costs of the exchanges to the administration that sought this law. And it is far from clear that the administration could operate the exchanges on its own. 

Congress didn't allocate money for administering federal exchanges, and the law as written seems to prohibit federally run exchanges from providing subsidies to individuals. The administration insists that it can provide those subsidies anyway. But if the courts read the plain words of the statute, then federal exchanges couldn't really function

Thus states that refuse to create their own exchanges would effectively be repealing a large part of the law—sparing their citizens from the job-killing employer mandate and from assaults on their religious liberty. In some cases people would even be spared from the individual mandate to buy coverage, since in the absence of exchange subsidies more families would qualify for exemptions from the mandate. 

The Medicaid expansion, meanwhile, would throw millions of additional Americans into a system that is already bankrupting state governments and increasing costs in the private-insurance market. Medicaid's payments for services are so low that many existing beneficiaries have trouble finding physicians and other health-care providers who will accept them as patients. Enrolling more people without reform will push the system to the point of collapse.

In refusing the Medicaid expansion, governors should notify Washington that doing so means freeing themselves of ObamaCare's "Maintenance of Effort" requirements. These would prohibit states participating in the Medicaid expansion from reforming their Medicaid systems to reduce costs. 

Instead of following the Obama administration's plan, states should seek real reform. For example, they should demand that Washington transform the federal portion of Medicaid for non-disabled and non-elderly beneficiaries into a uniform block grant, with state discretion over eligibility and benefits. The goal should be to turn Medicaid into a premium-assistance program rather than government-run insurance. Medicaid could then be used to help people enroll in mainstream insurance plans. This is the way to help the low-income uninsured get the same kind of coverage as other Americans.

President Obama won re-election and Democrats maintained control of the Senate this month, but the states hold the future of ObamaCare in their hands. Knowing the harm the law would do to their citizens, to the economy and to American health care, governors should refuse to become its enablers.

Mr. Capretta is a fellow at the Ethics and Public Policy Center and a visiting fellow at the American Enterprise Institute. Mr. Levin is a fellow at the EPPC and editor of National Affairs.
A version of this article appeared November 18, 2012, on page A19 in the U.S. edition of The Wall Street Journal, with the headline: Why ObamaCare Is Still No Sure Thing.

ATTRIBUTION SOURCE:

http://online.wsj.com/article/SB10001424127887324735104578122741540428344.html?mod=rss_opinion_main

How Obama can be stopped in Electoral College

Exclusive: Judson Phillips offers constitutional means to put Romney in office Jan. 21

We have one last, final chance to save America. We have one last, final chance to stop Barack Obama. One final chance.

What is this final chance? Will the Republicans step up to the plate and do what is necessary?

Barack Obama has not yet been re-elected president.

Yes, the election is over – but remember, a presidential election in America is not by popular vote. We vote for the candidate, but what we are really doing is voting for the electors who will meet on the Monday after the second Wednesday in December.

That is when the actual re-election of the president occurs.

Is there a way to stop this?

Yes, there is.

And the best part – this is totally constitutional.

The 12th Amendment of the Constitution as well as Article II of the Constitution govern the Electoral College.

According to the 12th Amendment, for the Electoral College to be able to select the president, it must have a quorum of two-thirds of the states voting. If enough states refuse to participate, the Electoral College will not have a quorum. If the Electoral College does not have a quorum or otherwise cannot vote or decide, then the responsibility for selecting the president and vice president devolves to the Congress.

The House of Representatives selects the president and the Senate selects the vice president.
Since the Republicans hold a majority in the House, presumably they would vote for Mitt Romney, and the Democrats in the Senate would vote for Joe Biden for vice president.

Can this work?

Sure it can.

Democrats have actually set this precedent of refusing to participate to deny Republicans a quorum. They did this in Wisconsin and in Texas. Why can’t we do this with the Electoral College?

Mitt Romney was a terrible candidate, and he will not be a great president. But he will be infinitely better than Barack Obama.

So how do we do this?

Mitt Romney carried 24 states. We need to have conservative activists from all over the nation contact the electors, the Republican Party and the secretary of state in all of these states and tell them not to participate in the Electoral College when it meets on Dec. 17.

If we can get 17 of those states (just over one-third) to refuse to participate, the Electoral College will have no quorum. Then, as the Constitution directs, the election goes to the House of Representatives.

That is how we can still pull this election out and make Mitt Romney president in January.

We need this concept shared with every tea party, liberty and patriotic group throughout the country. We have time to act, but we must pressure Republicans to do the right thing.
 
It does not matter who gets credit for this. The credit is not important. Using our last chance to defeat Barack Obama is important.

Far too often the Republican Party seems more interested in losing gracefully than winning and governing.
This is our last chance. We the people must contact the electors, party officials and secretaries of state from every red state and insist that they refuse to participate in the Electoral College.

We can still save America and use the Constitution to do it. But this truly is our last chance.

 Judson Phillips is the founder of Tea Party Nation. Follow him on Twitter at @judsonphillips or @teapartynation. 

Attribution Source:

http://www.wnd.com/2012/11/how-obama-can-be-stopped-in-electoral-college/