Rare Historical Photos: From The Burning Platform.

Posted October 29, 2014 by austrianaddict
Categories: Miscellaneous

Tags: ,

The burningplatform.com, posted some great old photos, some I have seen before but many I haven’t. Here are a few of them. Click Here to see the rest.

Under water detonation of a 15 kiloton nuclear weapon.

Abandon boy holding a stuffed animal in the ruins after the Germans bombed London 1940.

The last Jew In Vinnitsa, 1941.

Hitler rehearsing his speech In front of mirror, in 1925.

Using banknotes as wallpaper during hyperinflation in Germany 1923

The Fed Has Proved The Lefts “Trickle Down Straw Man” Doesn’t Work.

Posted October 28, 2014 by austrianaddict
Categories: Econ. 201, Government and Politics

Tags: , , , , , , , , , , , ,

The left always comes up with words or phrases that ridicule the ideas and/or policies of their opponents with the intent of stopping any intelligent debate about the merits. In the 80’s, the policy of lowering tax rates for the purpose of economic growth, was called “trickle down economics” by the left in an attempt to convince shallow thinking people that this idea couldn’t possibly work. The term “trickle down” has been used by the left since the 80’s to torpedo any economic policy, especially tax cuts.

HILLARY: ECONOMIST EXTRAORDINAIRE

Here is Hillary Clinton using this tactic in a speech yesterday (10/24/14) at a campaign rally for Martha Coakly.  At the start of this short video she says, “…don’t let anybody tell you that, you know, it’s corporations and businesses that create jobs.”, which is similar to the President saying, “..if you got a business, you didn’t build that“, in a campaign speech from the 2012. Mrs. Clinton’s statement reveals either her total ignorance about economics, or her great insight into the economic ignorance of the audience. We could write a post answering this statement, but it’s the next line; “You know that old theory, trickle down economics.  That has been tried. That has failed. That has failed rather spectacularly.”, that this post will be about.

THOMAS SOWELL AND WALTER E. WILLIAMS SPEAK ABOUT “TRICKLE DOWN”

Economist Thomas Sowell has challenged anyone to name an economist from any economic school of thought who had actually advocated a “trickle down theory”. In this article from 2001, Capital Gains And Trickle Down, he states that there is no such thing as “trickle down theory”. The left uses the term to attack tax cuts by saying, their opponents want tax cuts that will help the rich first and the money will supposedly trickle down to the masses. So just to be clear they are saying that letting everybody keep more of what they produce by reducing tax rates is a “trickle down theory”. This theory they created is simply a straw man.

Economist Walter E. Williams talks about the fake war that has been fought against the “Trickle Down” straw man in this article, Trickle Down And Tax Cuts. This is a tactic used by all politicians in which they misrepresent (lie about) an opponents idea or policy, setting up a straw man, in order to argue against this false premise instead of debating their opponent head on. In this case the left sets up the “Trickle Down” straw man to try to win the tax cut argument.

These two articles are really great especially the examples they give. Here are some excerpts from Thomas Sowell’s article.

“But free-market economics is not about “distributing” anything to anybody. It is about letting people earn whatever they can from voluntary transactions with other people.”

“Those who imagine that profits first benefit business owners — and that benefits only belatedly trickle down to workers — have the sequence completely backward. When an investment is made, whether to build a railroad or to open a new restaurant, the first money is spent hiring people to do the work. Without that, nothing happens.”

“Money goes out first to pay expenses and then comes back as profits later — if at all. The high rate of failure of new businesses makes painfully clear that there is nothing inevitable about the money coming back.”

” No one who begins publishing a newspaper expects to break even — much less make a profit — during the first year or two. But reporters and other members of the newspaper staff expect to be paid every payday, even while the paper shows only red ink on the bottom line.”

“In short, the sequence of payments is directly the opposite of what is assumed by those who talk about a “trickle-down” theory.”

Here are some excerpts from Walter E. Williams article.

“Trickle down is a nonexistent theory. Those who use it simply argue against a caricature rather than confront an argument actually made.”

“You can bet that the White House has people reading every bit of the news, including this column and Dr. Sowell’s article. You can bet some people in the news media will read it, as well. Despite the facts that Sowell has marshaled, they will continue to use trickle down theory and “tax cuts for the rich” demagoguery, even though they now have hard evidence to the contrary, because they can count on widespread gullibility and inability to do critical thinking.”

THE FEDS MONETARY POLICY, IS THE TRICKLE DOWN STRAW MAN

Getting money in the hands of the rich with the idea that it will trickle down through the rest of the economy is the straw man the left says won’t work. They are correct. The Feds loose money policy since 2000 is proof that it doesn’t work. Instead of letting individuals keep what they produce by lowering taxes, the Fed electronically prints counterfeit money and gives it to the top 1%. The Fed has printed a total of  $7 trillion since 2000 (click here) with $4 trillion of that being printed since 2008. Click here to see what has happened to the real median household income since this counterfeiting started before 2000. It has gone down.

The Fed injects electronically printed counterfeited money into the economy by purchasing mortgage-backed securities, from banks, and treasury bonds, from the Federal Government. The banks and the Federal Government have first access to the counterfeit money. Everyone in the immediate orbit of the banks and the Federal Government benefit secondarily from this printed money, you and I don’t benefit. Look at the charts in this article, Abolish The Engine Of Inequality: The Federal Reserve, by Charles Hugh Smith. They show that the  income and wealth of the people with access to the Feds counterfeit money has grown. And the wealth of the rest of us is stagnant or shrinking. The more the Fed prints the bigger the gap.

CONCLUSION

The Feds experiment of giving their counterfeit money to the people at the top and hoping it will trickle down has been going on since before the tech bubble popped in 2000. The tech bubble lead to the housing bubble that popped in 2008, which lead to the current financial bubble that will eventually liquidate itself at some point. The counterfeiting by the Fed created these bubbles in the first place. In the words of economist extraordinaire Hillary Clinton, “It has failed rather spectacularly“. She is correct. Trickle down economic theory defined by the left, as giving money to the wealthy in the hopes that it will trickle down, doesn’t work. Unless the goal was to make the first receivers of the money wealthier at the expense of the rest of us. But who could possibly be cynical enough to think that?

 

Related ArticleReal Savings vs. Counterfeit Savings, by austrianaddict.com.

Related ArticleA Tornado vs. The Fed, Which Is More Destructive, by austrianaddict.com.

 

 

 

 

Must Reads For The Week 10/25/14

Posted October 24, 2014 by austrianaddict
Categories: Must Reads For The Week

Tags: , , , , , , , , , , , , , ,
The pen is mightier than the sword...

 The pen is mightier than the sword… (Photo credit: mbshane)

Minimum Wage Increase Blowback: McDonald’s Plans Major Automation By Third Quarter Of Next Year, at economicpolicyjournal.com. You can’t raise wages above what the labor produces. Why do you think private sector union labor was 35% of the work force in the 50’s, and it’s 7% today. Unions priced themselves out of the market. They are now focused on unionizing Government workers, because politicians will always give in to their demands for more tax payer money.

Wal-Mart That Economic Wrecking Ball, at economicpolicyjournal.com. Wal-Mart gets slammed for supplying consumers with products at lower prices.

The Affordable Care Act Will Push More Women Than Men Into Part-Time Work, at economicpolicyjournal.com. Talk about your war on women?

Pipe Lines Pose Fewer Risks Than Compared To Transporting Oil By Rail Or Truck, at fraserinstitute.org. I think it is funny when environmentalists paint themselves into corners when they think they are making the “environmentally correct” decision. Unfortunately they don’t understand that when it comes to making decisions, there are no solutions there are only trade offs.

Quotation Of The Day On The Moral Case For Fossil Fuels, by Mark J. Perry, at aei-ideas.org. Our current standard of living was brought about, and is presently powered by fossil fuels. The only type of power that can compete with carbon based fuels is nuclear energy. Unfortunately we have been brain washed into being afraid of the word nuclear, we won’t even consider it as an alternative energy source.

Hacking Higher Ed. With Competency-Based Education, by Joanne Jacobs, at openstandard.mozilla.org. I saw this at carpe diem blog. Big college’s monopoly in higher education is going to start to crack. The best teacher in a particular subject can teach an unlimited amount of students online, why would you want a countless amount of average college professors who can only teach the limited number of students who attend their classes.

Fed Up With Govt. Misconduct, Federal Judge Takes Nuclear Option, by Sidney Powell, at observer.com. Eric Holder’s  Justice Department used false evidence to accuse Sierra Pacific of starting a wild-fire. Chief Judge Morrison C. England Jr. ordered every federal judge from the Eastern District of California to recuse themselves. The $55 million settlement will probably be set aside because of the misconduct. Why would anyone trust Government bureaucrats to do their job in a non political and unbiased way?

Google vs. The Entire News Industry: And The Winner Is…. at zerohedge.com. This is the creative destruction of the free market happening before our eyes.

Citizen Pulls Cop Over Gives Warning, youtube video. I don’t know if this guy is right. I am impressed with how both acted in this situation. Both were respectful and neither one escalated the situation to a point that it got out of control.

Predatory Journalism, by Thomas Sowell, at jewishworldreview.com. Anything Thomas Sowell writes is a must read.

 

This cartoon is really about big bloated Government in general not just the present administration. Republicans wouldn’t be able to make the present bureaucratic and regulatory mess work more efficiently. Even if they could, they would just be intervening in every aspect or our lives more efficiently. (I saw this at zerohedge.com.)

 

 

 

 

 

 

 

 

 

 

 

Two quotes about the incompetence of big Government.

Murray Rothbard – “Bureaucracy incompetent enough to plan a stationary system, is vastly more incompetent at planning a progressing one.”

George Gilder – “The ambitious agenda of contemporary liberalism simply ensures that Government will do nothing well, except to expand itself as an obstacle of growth and innovation. Government best supports the future by refraining as much as possible from trying unduly to shape it.”

 

 

Your Econonomic Homework

Posted October 22, 2014 by austrianaddict
Categories: Econ. 201

Tags: , , , , , ,

Business Woman Present Business Cycle - stock photo

I like reading economic articles by Richard Ebeling. He explains abstract economic concepts in ways that are understandable for regular people. Although we have written about these concepts in the past, we can always gain greater insight by reading different explanations by different writers. Even if you understand these economic concepts, this article may help when you try to explain them to people who don’t have the same level of understanding.

KEYNES LEAKS THE  TRUTH ABOUT DEBASING THE CURRENCY

As John Maynard Keynes said, “There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.”

The only way Central Banks have gotten away with electronically printing counterfeiting money is because it is difficult to understand. Our job is to shrink that one in a million ratio, because the only way our current problems change is if more people truly understand what results when the Fed intervenes in the market.

RICHARD EBELING ARTICLE

The article, Ludwig von Mises And The Austrian Theory Of Inflations And Recessions, by Richard Ebeling, at epictimes.com, explains, 1) How money emerges from markets not Government, 2) Saving and investment, 3) How central banks cause business cycles, 4) Inflation and misallocated resources, 5) Recession corrects the Fed caused misallocations.

Here are some excerpts from the article.

“Money is a market-based and market-generated social institution that spontaneously emerges out of the interactions of people attempting to overcome the hindrances and difficulties of direct barter exchange……Historically, gold and silver were found through time to have those attributes most desirable for use as a medium of exchange to facilitate the ever-growing network of complex market transactions that enabled the development of an ever-more productive system of division of labor.”

“Like all other prices on the market, the rates of interest on loans coordinate the choices of savers with the decisions of borrowers so to keep supplies in balance with demands for either consumer goods or future-oriented investment goods.”

“An economic recession, therefore, is the discovery period of misallocations of scarce resources in the economy that requires a rebalancing and a recoordination of supplies and demands for a return to market- and competitively-determined harmony in the society’s economic activities for long-run growth, employment, and improved standards of living.”

Related ArticleFederal Reserve Policies Cause Booms And Busts by Richard Ebeling, at austrianaddict.com.

Related ArticleKeynes Was Right In 1919, by austrianaddict.com.

George Will: Faith In Government?

Posted October 19, 2014 by austrianaddict
Categories: Government and Politics

Tags: , , , , ,

George Will was on Fox News Sunday, and here are his comments to the questions, 1)Can we have faith in Government? and 2) Can we trust the Government to do its job?

Here are the highlights from his comments.

“…you asked: ‘can we have faith in Government’? I think we have much more to fear from excessive faith in Government than from to little faith in Government.”

“You asked: ‘can we trust the Government to do its job’? What isn’t it’s job nowadays…this is a government that doesn’t know when to stop.”

The distilled essence….of progressivism is that Government is benign, that it’s a disinterested force. That’s false,  and b) it is stocked with experts who are really gifted at doing things…..Republicans do this Democrats do this also…a common theme is excessive faith in the skills of Government.

GOVERNMENT DOESN’T MAKE DECISIONS, INDIVIDUALS IN GOVERNMENT DO.

When we use the word Government we mean individuals in Government. Government doesn’t make policy and decisions, individual politicians and bureaucrats make policy and decisions. The reason these politicians have the power to make and implement certain decisions is because “we the people” set up the frame-work of Government that allows them certain areas in which to legislate. We also elect these politicians to sit in the seat of power. Unfortunately we have allowed them to ignore the boundaries that surround their power, because we don’t hold them accountable once they are elected.

Here are some examples of incompetence at different levels of Government. 1) The Nurse who flew to Akron after being exposed to Ebola, had contacted the Center for Disease Control twice asking them if it was alright to fly, and they said yes (read here). 2) The Parents who called the cops to help with their mentally ill son who locked himself in his room and threatened to harm himself. Eleven shots later their son was dead. The police succeeded in not letting him harm himself (watch here). 3) A 5-year-old girl pointed a crayon at a class mate, and school officials punished her by making her sign a contract that she wouldn’t kill anyone or commit suicide (read here). 4) Need we say more than the Obamacare web site that cost $2 billion (read here). This list is literally endless.

Here is a George Gilder quote about big Government, “The ambitious agenda of contemporary liberalism simply ensures that Government will do nothing well, except to expand itself as an obstacle of growth and innovation. Government best supports the future by refraining as much as possible from trying unduly to shape it.

It is our fault that we have arrived at this point where Government is this big. We are the only ones who can reel this monster in, because politicians and bureaucrats will never vote to reduce their power.

Related Article – “I’m From The Government And I’m Here To Help“, by austrianaddict.com.

Related ArticleTyranny Is Hidden Inside The Bureaucratic Maze, by austrianaddict.com.

Related ArticleProof Once Again That Power Corrupts, Will We Have Enough Courage To Believe It This Time, at austrianaddict.com.

 

 

Must Reads For The Week 10/18/14

Posted October 18, 2014 by austrianaddict
Categories: Must Reads For The Week

Tags: , , , , , , ,
The pen is mightier than the sword...

 The pen is mightier than the sword… (Photo credit: mbshane)

Scientists Have Debunked These 5 Common Myths About Red Meat, at businessinsider.com. First, I posted this because the video made me hungry for a medium rare steak. Second, these myths about red meat had to have come from some other “scientist”. I guess science is up for debate.

The Corruption Of Science, by William O’Keefe, at economicpolicyjournal.com. Everything is political, even science. Here is an excerpt from the article, “I want to …talk about … the rise of what has been called consensus science. I regard consensus science as an extremely pernicious development that ought to be stopped cold in its tracks. Historically, the claim of consensus has been the first refuge of scoundrels; it is a way to avoid debate by claiming that the matter is already settled. …Let’s be clear: the work of science has nothing whatever to do with consensus. Consensus is the business of politics.”

The Nightmarish Politics Of Ebola, by John Cassidy, at newyouker.com. Everything  is political, from the name of the Washington Redskins, to Ebola. As much as I hate politics, it is part of  the reality we live in. Even this article trying to decry the politics of Ebola, is a political article. When it comes to analysis of any event, the first question the cable news anchors ask is, “How will this help or hurt the (President, republicans, democrats, congress)” pick one. I don’t care about Ebola politically. I care about Ebola from an epidemiological stand point. When everything is politicized, Government is to big and intrusive. We are living in the chaotic middle ground between central planning and individual freedom.

The Increasing Precision And Efficiency Of Revolutionary Drilling Technologies Has Made US World’s Greatest Producer, by Mark J. Perry at carpediemblog. The US is now the leader in oil and natural gas production thanks to entrepreneurs and technology. Supplying more oil to the market has helped drop the price of oil. The law of  supply and demand is right again. Drill baby drill.

More Schumpeterian Innovation In Ride-Sharing Service Uber, And Another Reason Big Taxi Is Doomed, by Mark J. Perry, at carpediemblog. The upstart competitor (Uber) is putting its efforts into finding ways to serve the consumer better, which in turn expands its business. The status quo monopoly (Taxi Cartel) puts its efforts into trying to keep the upstart competitor out of the market. The consumer will decide which strategy is the best.

The 10 Deadliest Jobs In The US, at economicpolicyjournal.com. Producing a higher standard of living has a cost in lives. But a higher standard of living not only saves lives, it also makes it possible to support a higher population.

Irresponsible ‘Education‘ , and We Can Still Salvage Enough Of The Constitution To Remain A Free And Democratic Nation, by Thomas Sowell, at jewishworldreview.com. These are two great articles by my favorite author, and are truly must reads. Thomas Sowell always makes you think. He also makes you debate, with yourself, about how you arrived at the way you think about different subject matters.

 

Are We Losing Economic Freedom?

Posted October 15, 2014 by austrianaddict
Categories: Econ. 101, Government and Politics

Tags: , , , , , , , ,

Capitalism 3D sphere Word Cloud Concept with great terms such as economic, private, free and more. - stock photo

The Fraser Institute published a paper titled, Economic Freedom Of The World: 2013 Annual Report, which shows how the US is in the slow lane on the Road to Serfdom, because we as individuals have lost economic freedom over the past 12 years. Economic freedom is nothing more than each individual deciding what to produce, consume, exchange, and save without anyone, especially Government bureaucrats, hampering or intervening in his activities. Individuals are less free today than they were in 2000.

Scroll down to page 148 in the report to see the statistics for the United States in different categories related to freedom, from 1980 to 2011. The report rates 154 countries on economic freedom, with a 10 being the highest rating. It also ranks each country in order of most free to least free. Our freedom rating and rank has dropped since our high in 2000.

CATEGORY     (rate/rank)                    80               90              00               11

UNITED STATES

Summary  (rating/rank)                  7.92/3      8.35/3      8.65/2        7.74/19

Size of Government                           5.08/49    6.71/24   7.03/34    6.83/47

Legal System/Property Rights     8.35/1       8.35/10   9.23/9        6.93/38

Sound Money                                      9.22/5       9.68/7      9.78/2       9.30/36

Freedom Of Trade Inter.                8.77/7       8.77/11    8.78/22    7.92/30

Regulation                                            8.11/4         8.23/4      8.43/2       7.75/17

 

Below is Hong Kong’s summary rating and rank for economic freedom. Go to page 62 to see a more detailed report on Hong Kong.

HONG KONG                                              80                90                00               11

Summary  (rating/rank)                 9.02/1        8.59/1       8.86/1        8.87/1

Hong Kong was under British rule for 156 years until 1997 when it was turned over to China. Hong Kong has had more economic freedom under British colonial rule, and Chinese communism than the US has had under a constitutional republic with leaders elected democratically. People in Hong Kong have been protesting recently because it looks like China is going back out on its promise to allow democratic elections in 2015. The people in Hong Kong should take a look at the US to see what democratic elections have done to our economic freedom, before they go all in for democracy. Democracy is just one possible means for gaining individual freedom, but it is no guarantee of individual freedom. Read, Thomas Sowell Explains How Democracy And Freedom Are Not The Same Thing.

Three of the categories, listed in the above article, that the Fraser Institute rates and ranks countries on their level of economic freedom are; legal system/property rights, regulation, and sound money. The US has decreased in rate and rank in these three categories over the last decade.

REGULATION

The Affordable Care Act (Obamacare) is just one example of  the thousands of pages of regulations, passed by congress and signed into law by the President, that take away economic freedom by imposing  huge costs on businesses. Where does the Government get the power to interfere with an individuals right to make a contract with another party on how he chooses to pay for his healthcare? Nowhere in the constitution do politicians and bureaucrats have a right to do this. They’ve usurped the power from us, and the Supreme Court, which has turned into a nine seat legislature, uphold their lawlessness. Read Regulatory-Industrial Complex, by Lew Rockwell, at mises.org, for more analysis on what regulation does to economic freedom.

SOUND MONEY

We could talk endlessly about how important sound money is for economic freedom, but here is the short version. When the Federal Reserve electronically prints counterfeit money, it is theft. What you produce each day at work is represented in the money your employer gives you in exchange for your labor. You in turn can demand goods and services with the money you are paid. The stable purchasing power of the monetary unit is what sound money guarantees. When the Federal Reserve electronically prints counterfeit money, it is decreasing the purchasing power of each dollar you have, and therefore stealing your production. If you or I counterfeit money it is theft. If the Fed counterfeits, it is still theft, it is simply theft that is sanctioned by the legislative, executive, and judicial branches of Government. Read, Is The Surge In Capital Goods Orders Do To Malinvestment, by Frank Shostak, at mises.org, to understand what happens when the Fed counterfeits.

PROPERTY RIGHTS

Without property rights there is no economic freedom. If an individual has no assurances that what he produces or owns can’t be taken away, then economic freedom is just meaningless rhetoric by politicians. There is the obvious taking of property through eminent domain laws (Kelo vs. New London), civil asset forfeiture laws, federal taxes etc, and then there is the unseen taking of property through the cost of complying with regulations, and out right stealing it by electronically printing counterfeit money. Read “Human Rights As Property Rights, by Murray N. Rothbard, at mises.org, to see how property rights are the foundation of economic freedom.

As F. A. Hayek said, “the battle for freedom must be won over and over again, the socialists of both parties must be persuaded or defeated if they and we are to remain free men.” These words are more true today then when he wrote them.

 

-I found the, Economic Freedom Of The World: 2013 Annual Report, in this article titled, The “Land Of The Free” Ranks 36th In The World In Respecting Property Rights, at zerohedge.com.

 

 

 

 


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