Monty Pelerin's World

Economic, Financial and Political Analysis

Archives for law

Benghazi: A Problem For Both The Bloods and Crips

Taking the State wherever found, striking into its history at any point, one sees no way to differentiate the activities of its founders, administrators and beneficiaries from those of a professional-criminal class. Albert J. Nock

benghaziMr. Nock wrote these words in the 1920s or 1930s. When he wrote them, history supported his contention. Nothing has changed since, except ethics, integrity and law abidance have all deteriorated.  The criminality of States referred to by Nock has only increased. That would not have surprised him if he were still around.

The evidence is now coming out regarding Benghazi. Doug Ross reports on it below and calls it “damning.” It is certainly that and probably to few objective observers’ surprise. That is the problem! No one seems to care, at least in Washington. The corruption is so ensconced and the gains so big that no one wants to rock the boat.

Contrast the current situation with that of Watergate. President Nixon faced impeachment over a third-rate burglary which he apparently did not order. His crime was trying to protect subordinates by attempting to cover-up the break-in. Nixon resigned rather than face certain impeachment and probable removal from office.

The Nixon stain on the Presidency occurred forty years ago. Today, it seems trivial. Today it would not be considered a crime, merely good political tactics or strategy. Society and our politicians have no moral compass anymore. Compare the Watergate details with the emerging information about Benghazi and see how much we have deteriorated.

The Benghazi problem goes beyond Obama and Hillary Clinton. They are both guilty of much more serious crimes and misdemeanors than Nixon and should be held accountable. But they won’t be because Washington cannot afford to let this happen. In that sense, Benghazi is just as much a problem for the Republicans as the Democrats. It is necessary that the cesspool of lying, plunder and criminal behavior that is Washington not be revealed.

bloodscripsThe gang lords of DC consider themselves above the laws that govern a civil society. They are too important (and too powerful) to be held accountable. The city is ruled by two competing gangs, much like the Bloods and Crips. They will do whatever they can to gain advantage over one another. They are constantly battling each other over turf, except under one condition. That condition brings them together and they fight as one. That condition occurs whenever the scam they both participate in is threatened.

Benghazi represents just such a threat. In that respect, it is as much of a Republican problem as a Democrat problem. It goes beyond Obama and Hillary. It threatens to expose the entire corrupt culture which is Washington. That is the way that Benghazi has to be understood. Republicans will not act in what appears to be a clear-cut situation. They will be described as feckless and worse. Regardless of whether that is the case or not, it is not the reason they will not act. They will not act because to do so threatens the entire political casa nostra.

It is not Obama and Hillary who are on trial here. It is the entire political class. The Republicans by not bringing impeachment proceedings are no better than the perpetrators responsible for Benghazi and those who engineered its cover-up. The media, by ignoring this story, have proven themselves to be useless, at least with respect to any role a free press is supposed to play.

The Democrats and the Republicans are little different from the Bloods and the Crips. Both exploit the societies they rule and both battle each other over turf. They are arch enemies until and unless the exploitation itself is threatened. Then they come together to form a united defense.  As important as turf may be, the protection of the scam is more important. Thus, the game is to battle hard against each other for advantage unless outsiders threaten the scam.

Any idea that Washington wants to deal with impeachment hearings is misplaced. The Republicans are just as threatened by this scandal as the Democrats. Their vulnerability is not because of culpability but the risk that the entire corrupt enterprise that is Washington be exposed. Benghazi exposed is a threat to the Republicans as well as the Democrats.

The Bloods will help out the Crips to prevent too much from surfacing. Don Obama will not be impeached, although he should have been even before Benghazi. The corruption will continue and worsen.

Here is Mr. Ross’ article:

DAMNING: The Complete Benghazi Timeline in Spreadsheet Format

The complete Benghazi timeline, now augmented with information culled by Stephen Hayes and the House Oversight Committee [PDF], leads me to four inescapable conclusions.
[You may be able to get an enlarged version of this table by going to the Ross article]


It is now clear to me that:

a) Hillary Clinton lied under oath to Congress.
b) Barack Obama went to sleep knowing that a U.S. Ambassador and other Americans were under terrorist attack.
c) Barack Obama awoke refreshed the next day to begin fundraising.
d) The entire Executive Branch lied repeatedly to the American people to save Obama’s chances for reelection.

Could someone drag John Boehner out of whatever bar he’s in, wake him up, and let him know: There is more than enough material for impeachment proceedings to begin and criminal charges levied against Hillary Clinton.

Corruption Run Amuck

gallows (2)To understand why markets are so dangerous, it is only necessary to listen to this interview with economist Jeffrey Sachs. Regarding the rampant disregard of honor, truth and legality in markets, he says:

I regard the [Wall Street] moral environment as pathological …

We have a corrupt politics to the core, I’m afraid to say… both parties are up to their necks in this.

Mr. Sachs is not an outlier on this subject. People like William Black and others have been saying similar things for years.

It is interesting that given all the regulations passed in the last five years, the integrity of markets has never been so compromises. Regulations mean nothing if you don’t take and hang some prisoners.

Read Janet Tavakoli’s article on this issue and listen to the interview of Mr. Sachs.

 

Guns and Gun Control

Some things are too difficult for our President to understand:

Interesting comparison.
A Tale of Two Cities
Chicago, IL
Houston, TX
Population
2.7 million
2.15 million
Median HH Income
$38,600
$37,000
% African-American
38.9%
24%
% Hispanic
29.9%
44%
% Asian
5.5%
6%
% Non-Hispanic White
38.7%
26%
Pretty similar until you compare the following:
Chicago, IL
Houston, TX
Concealed Carry gun law
no
yes
# of Gun Stores
0
84 – Dedicated gun stores plus 1500 – legal places to buy guns- Walmart, K-mart, sporting goods, etc.
Homicides, 2012
806
207
Homicides per 100K
28.4
9.6
Avg. January high temperature – (F)
31°
63°
Conclusion:  Cold weather causes gun violence.

 

When Suckers Finally Realize

governmentinsolvThe fleecing of the American public continues.

The theft takes different forms, but it all serves one purpose — to transfer wealth from the average Joe to the crony corporatists and their political lackeys. Here are but a few examples of how this has been accomplished:

  • Bailouts for the wealthy and well-connected are paid for by the unconnected middle class.
  • Subsidies are provided for unworkable schemes submitted by political donors and favorites. These schemes inevitably fail and the tax-payer is left holding an empty bag.
  • Laws are routinely ignored when “friends” need help. In identical circumstances, would you receive the same treatment as Jon Corzine?
  • Despite the biggest theft in world history, no one was prosecuted. The Savings and Loan crisis in the 1980s was trivial in comparison to the recent financial crisis. More than a thousand S&L executives were prosecuted.
  • Ever-increasing sacrifices in the form of higher taxes from the productive sector are demanded to continue the plush living of the ruling class.

Capitalism and free markets depend upon trust, integrity, property rights and the rule of law. Without these, there are no advantages to free markets. Nor are there any incentives to create wealth. Instead, an economy becomes little more than a massive plunder scheme where the powerful exploit the weak. No economic recovery is possible under such circumstances.

french revolutionWhen Suckers Revolt

As people recognize what is happening, they alter their behavior. Three reactions are to be expected:

1. Some will become discouraged when they realize the game is stacked against them. They will diminish their efforts to succeed, even perhaps dropping out of the game altogether. Given the enhanced returns to not working, it should not be surprising that this alternative has become popular.

2. Others will adopt the same behavior as the ruling class. They will exploit those lower on the food chain than themselves.  Justice Brandeis warned of the implications of government misbehavior:

In a government of laws, the existence of the government will be imperiled if it fails to observe the law scrupulously. Our government is the potent, the omnipotent teacher. For good or ill, it teaches the whole people by its example. If government becomes a lawbreaker it breeds contempt for law: it invites every man to become a law unto himself. It invites anarchy.

Daniel Patrick Moynihan described the process of declining moral values as “defining deviancy down.”

3. Others may resort to acts of violence. These reactions could be isolated domestic terrorist acts against government and corporations seen as the exploiters. Or the acts might be broader based where the poor see fit to attempt to take from the wealthy. They also could manifest in wide civil unrest against the government if it is seen as the cause of misery or if it is seen as intending to default on promises made. 

All of this behavior is anti-social and it is unproductive. It reduces the output of the economy, further exacerbating the problems. 

How Does This End? 

It is difficult to know how the current condition ends. Here are a few possibilities, with some opinion added: 

  • Will our ruling class alter its behavior? That is very unlikely. History provides no examples where power is willingly relinquished.
  • Will our economy collapse? That is a likely outcome, although the process could take years or decades. 
  • Will social unrest occur? Probably. The government, at some point will be unable to honor its promises. It is broke and left with the printing of money as its primary source of funds. Stopping the printing means dishonoring promises and likely plunges the country into civil unrest.
  • Will hyperinflation occur? If the government continues to print, that seems to be the inevitable result. 

Issues That Need To Be Solved

We are too far into this economic disaster to escape without an economic collapse of some sort. Return to normal economic times is impossible without a complete and thorough purging of the economic distortions and capital mis-allocations produced from decades of government interventions.

The following issues prevent a recovery:

  • No economy can prosper without a strong middle class. They are the productive class in society. They are the small businesses and job creators. Without them, society does not produce. Without production, there is only poverty.
  • Inflation, the cruelest tax of all, is driving up prices while wages and salaries do not keep pace. For those without wealth, there is no way to protect against this theft. For those with wealth, they can rearrange investments to take advantage of inflation, particularly if they are privy to what is coming next.
  • The economy is dysfunctional. It no longer functions efficiently as a result of the burdens it is forced to labor under. The price system has been made less efficient as a result of inflation, manipulated interest rates, subsidies, penalties and other impediments. It no longer provides the information needed by economic actors to make proper decisions.
  • Regime uncertainty discourages action. When economic actors are unable to judge the future, they pull back. Money goes to the sidelines or out of the country.
  • US economic policy and the uncertainty of what comes next has been a great job creator for other countries.
  • Economic growth cannot be forced by central diktats. It occurs only in a climate that is receptive and friendly to risk-taking. It is hard to imagine a worse environment than the current one. That is why there is no investment and no hiring.

What Is The Outlook?

There should be no optimism regarding government changing its ways. History suggests it never does.

The recent plunge in the gold market suggests government has gone all in in its attempt to continue exploitation. Chris Martenson commented on this event:

I am very disappointed by, but not surprised at, the latest transfer of weath to the bankers from everyone else. The most recent gold bear raid has vastly enriched the bullion bankers, once again, at the expense of everyone trying to protect their wealth from global central bank money printing.

Gold is considered a safe-haven against government plunder. It is one of the few escapes from fiat currency debauchery that the small investor has. Whether this latest attack on gold was to make the bullion bankers better off or to scare those trying to protect themselves against government exploitation is irrelevant. When government intervenes (assuming it did, and the circumstantial evidence is pretty strong) in markets in such a manner, it is no longer a referee. It has chosen a side and is a participant in the game. There can be no fair competition when one team owns the referee. That is what happens when government participates in markets.

Historians judge that it took Rome almost two hundred years to die. That determination depends very much upon what you mean by “die.” Arguably Rome died much earlier than historians acknowledge. Rome was dead-man walking before the couple of hundred years it took for it to fall down. 

The US is in similar position. Unless you believe in the miracle of sovereign resurrection, the US is over. The coroner-historians have not pronounced death yet, but they, like with Rome, are behind the curve. This dead man too will eventually fall down. 

Government Is Destroying Society

mayberry(2)Civilization is fragile. It can be destroyed from within by merely forgetting what seemingly unimportant but necessary condtions. Like economics, society cannot be managed from the top down. It is dependent upon relationships among individuals and these are dependent upon rules or incentives.

I usually emphasize property rights and the Rule of Law as foundations for a civilized society. Naturally, freedom is assumed. Others use different terms, but they essentially point to the same things. Richard Mayberry, noted investment adviser, expresses his conditions less formally but equally meaningfully:

 In my book, Whatever Happened to Justice?, in a few of the other Uncle Eric books and in my newsletter, I often point out that the two fundamental laws that make civilization possible are 1) Do all you have agreed to do and 2) Do not encroach on other persons or their property. The first is the basis of contract law, and the second is the basis of tort law and some criminal law. If you have a population that’s dedicated to these laws, and the laws are widely obeyed, then you can have a very ethical civilization, one that moves forward very quickly.

If, however, you have somebody or some large group of people who are violating those laws, then that civilization can’t operate very well and it begins to decline. We see this all over the world. When legal systems are mutated to be tools of government policy rather than tools for producing a peaceful society, then it all goes to wrack and ruin. And this is repeated over and over again, throughout history.

I come back to that all the time. America has drifted entirely away from those two laws. Most Americans have never heard of them. Those laws were extracted from the British common law, which goes back to the Middle Ages. It used to be that in the schools the children were taught common law. In fact, at the time of the American Revolution, the common law was American history. If two Americans were talking about history they would be talking about common law. Most Americans today don’t have the foggiest idea what common law was, and civilization is in a downhill slide because it can’t go any other direction without those two laws.

You might want to read his full interview at the Daily Bell. It may open some eyes to a different view of the world.

We are at a point where our government is destroying the bonds of civilization. If they continue their attack on property rights and the Rule of Law, society is going to become very uncivil. It will make life “nasty brutish and short.”

When people are better than their government, they must either restrain their government or turn upon themselves as a result of their government.

 

Page 2 of 54:« 1 2 3 4 5 »Last »