News You Missed 10.07.13

The pursuit of Constitutionally grounded governance, freedom and individual liberty

"There is but one straight course, and that is to seek truth and pursue it steadily." --George Washington                                       

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The Fed was conceived in iniquity and raised in sin

Reuters' Analysis Excerpt on the Federal Income Tax

Economists like Emmanuel Saez, the University of California, Berkeley scholar who rates as the leading authority on high incomes, points out that refusal to revisit stiff top marginal rates makes no sense. Top tax rates today could double, Saez and his colleagues say, without jeopardizing our economic health. 

Saez has more than economic theory on his side. He has history. On this anniversary of the first income tax, let’s be sure to remember that history — and the Americans who made it.  In 1909, former Attorney General Wayne MacVeagh asked “Why should the colossal incomes and the colossal accumulations of the possessors of what Mr. Carnegie himself calls surplus wealth continue to be exempted from proper taxation?” 

“Gigantic fortunes,” MacVeagh said, serve as “serious obstacles to the contentment, the peace and the healthy growth of the community as to call for their abatement.”  Let’s stop treating our egalitarian-minded forebears like MacVeagh as crazy old uncles we hideaway in the attic. Let’s invite them into our public policy parlors. They have much to share. We have much to learn.

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The Analysis of the Analysis

The main trouble with the above analysis (and there are many troubles to be sure) is that this brief history leaves out the role of the Federal Reserve. It was the creation of the dollar reserve structure that created the US’s 20^th century “prosperity” not the enforced confiscation of taxes.

The Fed created the boom of the Roaring 20s by debasing the dollar, supposedly to help the English pound regain its status as the world’s dominant currency. In 1929, the market finally, quite understandably, crashed and the long, dark night of the Depression swept over both the US and most of the rest of the world.

Panicked, Fed bankers apparently prevailed on Franklin Delano Roosevelt to confiscate gold. This was so that US citizens would not trade in their “dollars” for gold at commercial banks and find out that the banks had none because the Fed had transgressed against the legal dollar/gold reserve ratio. That was, after all, how the Fed had created a spurious boom and debased the dollar, by printing more paper than they were allowed to, given their gold holdings.

Yes, the Fed was conceived in iniquity and raised in sin. Its history is a kind of continued criminal action. As the Great Depression rolled on, the bankers and the US and British political elite became more and more worried about civil insurrection.

Fortunately, and most conveniently, a world war broke out. After the war, the US was the single, lone, dominant standing nation-state. Its gross national product for a while represented 50 percent of the world’s, apparently. And when the US spent itself almost into oblivion during the Vietnam War, the result was a cessation of the gold standard entirely and the birth of the petrodollar.

Richard Nixon dispatched “Super K” – Henry Kissinger – to Saudi Arabia to instruct the Saud family to trade dollars only for oil. As the biggest producer of oil in the world, Saudi Arabia was also the marginal hinge and its currency policies were therefore the policies of OPEC.

The world would now have to hold US dollars to buy oil and thus there would always be a demand for these dollars. This deal gained Kissinger a TIME magazine cover picturing him as Superman and gave rise to a thousand myths about modern US “exceptionalism.”

The original US exceptionalism had to do with its agrarian republican heritage, in large part enunciated by Thomas Jefferson. The US’s late 20^th century exceptionalism as enunciated by a controlled mainstream media suggested fuzzily that “American values” were responsible for the US’s extraordinary prosperity. US workers were simply more efficient, unions were more determined, individuals more patriotic, science more expert, multinationals more determinedly managerial, etc. The US was indeed a shining house on the hill … only it wasn’t.

US prosperity was built on Mao’s famous dictum: Power springs from the barrel of a gun. We know today that there is oil all over the Earth. But throughout the 20^th century, top elites managed to control discoveries and exploitation via “green” maneuverings and repetitive fictions such as “peak oil.”

This is the REAL history of the 20^th century. US prosperity was built from calculated resource scarcity and determined intimidation of the Saud family and other oil producers. Because the world had to hold dollars, the US could print as many of them as it wanted. No other nation could do so.

The dollar tribute poured into the US. Never had there been such a mighty empire. The dollar reserve system allowed the power elite to build an enormous military and a vast penal system. Gradually, US Intel spread its agents and influence around the world.

The US’s 20^th century prosperity had NOTHING to do with graduated taxation or the idea advanced by the above Reuters analysis that somehow a political determination to create a “moral” people with income-leveling facilities sparked US power and prosperity in the 20^th century.

Leaving aside any potentially logical reasons to forcibly confiscate wealth, the secret monetary history of the US shows us clearly how US and British elites manipulated the world’s monetary system to gain riches grander than Croesus’s. 

For those with the stomach to face reality (and if you are reading this, perhaps you are such a person) there is something else to consider that has been mentioned before. It is the idea that the power elite responsible for the petrodollar has decided to abandon it.

We base this conclusion on the sudden emergence of shale oil and the increasing Western spawned violence destabilizing the Middle East. It seems that a move is afoot by the dollar’s controllers to gradually substitute something else for the dollar, a more globalized “bancor” – as Keynes once predicted.

In any event, these are trends you should be careful to watch. Don’t be fooled by the mainstream media’s dominant social themes. The Anglo sphere remains the world’s most powerful entity and it is highly doubtful that global financial maneuverings would be taking place without its acquiescence.

Of course, you will read none of the above in the Reuters articles or the main stream media, only that the moral imperatives of leveling created the prosperity that US citizens cherished in the 20^th century. How this explains the economic chaos of the 21^st remains  a mystery into which Reuters or the main stream media does not delve. Probably for obvious reasons.

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Update From Obama's 'Make 'em Suffer' File - Mad Yet?

The federal government has now been shut down for seven days, and the two parties appear no closer to a deal to fund it. The Republican-controlled House has passed smaller measures funding various parts of government to pressure Democrats to keep saying "no." These included restoring funding for veterans benefits, caring for children with cancer, food assistance and national parks. The House even passed a bill by a vote of 407-0 granting retroactive pay to government workers on furlough. Speaker John Boehner (R-OH) says he won't bring up a bill to fund the entire government until Barack Obama and the Democrats agree to negotiate deficit spending. The Obama administration and Senate Democrats refuse to budge, believing that the shutdown is only going to hurt Republicans politically. The one thing both sides agree on is that it's the other side's fault.

Obama did say over the weekend that he's willing to negotiate changes to ObamaCare ... but only after Republicans end the shutdown with a "clean" continuing resolution and then agree to hike the debt ceiling. That's convincing -- give him everything he wants and then he'll talk. Of course, negotiating with Obama is like playing chess with a pigeon. The pigeon knocks over all the pieces, craps on the board and then struts around like it won the game.

Meanwhile, the president continued his gambit to make the shutdown as annoying and inconvenient as possible, erecting Barricades at every national park and closing down every government website -- all of which takes more effort and expense than simply letting things be. The "Amber Alert Website" is shut down, Michelle's Website "Let's Move" is up [www.letsmove.gov.] Here's but a short list of closings due to this ridiculous political stunt: The Iwo Jim Memorial is closed, veterans were removed from the Vietnam War Memorial, highway pull-offs [public roads] with a view of Mount Rushmore are blocked, some of the Florida ocean is off-limits, the Grand Canyon is closed despite Arizona's offer to keep it open with state funds and 60 families with vacation homes at Lake Mead were ordered to leave. One angry Park Ranger confirmed that it's all politics: "We've been told to make life as difficult for people as we can. It's disgusting." It's also standard operating procedure for Barack Obama.

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Dr. Ben Carson: Obamacare Hurts Just as Healthcare 'Golden Age' Emerges  by Greg Richter

Just as healthcare enters a "golden age," Obamacare threatens to reverse course, warn Dr. Ben Carson and Rep. Michael Burgess, R-Texas in a guest editorial for Forbes.

"The full promise of genomic medicine informing diagnosis and treatment beckons from just over the horizon," the two write. Young doctors just starting out "have the ability to alleviate human suffering that no generation of doctors has ever previously known," they say.

Carson retired in May as a professor of neurosurgery, oncology, plastic surgery, and pediatrics at the Johns Hopkins School of Medicine. He has become a tea party favorite after criticizing the Affordable Care Act at this year's National Prayer Breakfast as President Barack Obama sat on the dais.  Burgess, part of the House's tea party caucus, was a practicing physician before winning Dick Armey's former seat in 2003.

Obamacare was not the product of careful study by a learned group, the two say, but "a hastily contrived political farce that was literally cobbled together at the last possible minute."  The writers are critical that successful state models were not looked at. The Healthy Indiana program, they note, cut healthcare prices by 10 percent during a two-year period. The Affordable Care Act was never intended to actually become law, they argue "— except that it did." In the past 3 1/2 years since its passage, Obamacare has been "pushed and prodded" by officials "to give it the appearance of workability."

America is on the threshold, they write, of finding out whether it will be a success. Americans without insurance from their employers could begin signing up for state-run exchanges on Oct. 1, but the first week has been bugged with problems with rampant reports of failures to log in. The government hasn't released numbers of those who have successfully signed up for insurance, but the site was taken down over the weekend to fix the problems.  Tea party Republicans in the House and Senate have led the effort to tie a budget bill to funding for Obamacare, and the government has been shut down since Oct. 1 over the impasse.

"In medicine, we sometimes talk about the compression of morbidities, how the ravages of time and multiple maladies may overwhelm the patient at the end of life," Carson and Burgess say. "That compression sequence also seems to describe afflictions of the Affordable Care Act as it careens towards implementation."

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"The known propensity of a democracy is to licentiousness which the ambitious call, and ignorant believe to be liberty." –Fisher Ames, speech in the Massachusetts Ratifying Convention, 1788

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