21st Century Schizoid Boy

Buried a few minutes into a discussion about intellectual property, Stephan Kinsella discusses, ‘What is Libertarianism?’, and it’s pretty thought provoking. “Libertarians are the only ones who really oppose slavery, in a principled way. Nonlibertarians are in favor of at least partial slavery. This slavery is implicit in state actions and laws such as taxation, conscription, and drug prohibitions.”

Every person has, controls, and is identified and associated with a unique human body, which is a scarce resource.

The libertarian view is that each person completely owns his own body — at least initially, until something changes this, such as if he commits some crime by which he forfeits or loses some of his rights.[18] Now some say that the idea of self-ownership makes no sense. You are yourself; how can you own yourself? But this is just silly wordplay.

To own means to have the right to control. If A wants to have sex with B’s body, whose decision is it? Who has the right to control B’s body? A, or B? If it is A, then A owns B’s body; A has the right to control it, as a master to a slave. But if it is B who has the right to decide, then B owns her own body: she is a self-owner.

And of course, self-ownership is what is implied in the nonaggression principle. Ayn Rand famously said, “So long as men desire to live together, no man may initiate.… No man may start — the use of physical force against others.”[19] To initiate force means to invade the borders of someone’s body, to use her body without permission or consent.[20] But this presupposes that that person has the right to control her body: otherwise her permission would not be needed, and it would not be aggression to invade or use his body without his consent.

So the libertarian property-assignment rule for bodies is that each person owns his own body. Implicit in the idea of self-ownership is the belief that each person has a better claim to the body that he or she directly controls and inhabits than do others. I have a better claim to the right to control my body than you do, because it is my body; I have a unique link and connection to my body that others do not, and that is prior to the claim of any other person.

Anyone other than the original occupant of a body is a latecomer with respect to the original occupant. Your claim to my body is inferior in part because I had it first. The person claiming your body can hardly object to the significance of what Hoppe calls the “prior-later” distinction, since he adopts this very rule with respect to his own body — he has to presuppose ownership of his own body in order to claim ownership of yours.[21]

The self-ownership rule may seem obvious, but it is held only by libertarians. Nonlibertarians do not believe in complete self-ownership. Sure, they usually grant that each person has some rights in his own body, but they believe each person is partially owned by some other person or entity — usually the state or society. Libertarians are the only ones who really oppose slavery, in a principled way. Nonlibertarians are in favor of at least partial slavery.

This slavery is implicit in state actions and laws such as taxation, conscription, and drug prohibitions. The libertarian says that each person is the full owner of his body: he has the right to control his body, to decide whether or not he ingests narcotics, works for less than minimum wage, pays taxes, joins an army, and so on.

But those who believe in such laws believe that the state is at least a partial owner of the body of those subject to such laws. They don’t like to say they believe in slavery, but they do. The modern left-liberal wants tax evaders put in jail (enslaved). The modern conservative wants marijuana users enslaved.

http://www.youtube.com/watch?v=GZgLJkj6m0A

Libertarianism on property: Rights in a sense originate in agreement: agreement among people to respect each others’ rights. This is possible only among rational, conceptual beings. An animal such as a cow can’t agree to anything. It’s too stupid. Therefore it can be owned (that’s not to say necessarily that it should be mistreated or killed).

Libertarianism is a political philosophy, and only a political philosophy. It is not a philosophy of life, indicating the best way to live, apart of course, from refraining from initiating violence against other people and their justly owned property. It asks but one question, When is force justified? And gives but one answer, Only in retaliation or defense against a prior use of violence. The rest is merely the weaving out of the implications of this question and that answer.

http://libertarianpapers.org/articles/2010/lp-2-6.pdf

Warren Harding was the president of the United States in the early 1920s. He shepherded the economy out of one of the worst depressions [1] [2] (beginning in 1920 and caused by the inflation of World War 1) in just about 1 year, subsequently leading to the Roaring 20s (which in itself did not lead to the Great Depression… that was caused by a classic credit expansion by the Federal Reserve starting in 1927). He used the classical economic approach of cutting government, paying off debt, asking citizens to save and work hard, and letting capitalism (i.e. the people) liquidate bad assets and correct malinvestments instead of “wild government experiments” which further distort the economy and prolong the agony:

Perhaps we can make no more helpful contribution by example than prove a Republic’s capacity to emerge from the wreckage of war. While the world’s embittered travail did not leave us devastated lands nor desolated cities, left no gaping wounds, no breast with hate, it did involve us in the delirium of expenditure, in expanded currency and credits, in unbalanced industry, in unspeakable waste, and disturbed relationships…

We must face the grim necessity, with full knowledge that the task is to be solved, and we must proceed with a full realization that no statute enacted by man can repeal the inexorable laws of nature. Our most dangerous tendency is to expect too much of government, and at the same time do for it too little. We contemplate the immediate task of putting our public household in order. We need a rigid and yet sane economy, combined with fiscal justice, and it must be attended by individual prudence and thrift, which are so essential to this trying hour and reassuring for the future.

The business world reflects the disturbance of war’s reaction. Herein flows the lifeblood of material existence. The economic mechanism is intricate and its parts interdependent, and has suffered the shocks and jars incident to abnormal demands, credit inflations, and price upheavals. The normal balances have been impaired, the channels of distribution have been clogged, the relations of labor and management have been strained. We must seek the readjustment with care and courage. Our people must give and take. Prices must reflect the receding fever of war activities. Perhaps we never shall know the old levels of wages again, because war invariably readjusts compensations, and the necessaries of life will show their inseparable relationship, but we must strive for normalcy to reach stability. All the penalties will not be light, nor evenly distributed. There is no way of making them so. There is no instant step from disorder to order. We must face a condition of grim reality, charge off our losses and start afresh. It is the oldest lesson of civilization. I would like government to do all it can to mitigate; then, in understanding, in mutuality of interest, in concern for the common good, our tasks will be solved. No altered system will work a miracle. Any wild experiment will only add to the confusion. Our best assurance lies in efficient administration of our proven system.

The forward course of the business cycle is unmistakable. Peoples are turning from destruction to production. Industry has sensed the changed order and our own people are turning to resume their normal, onward way. The call is for productive America to go on. I know that Congress and the Administration will favor every wise Government policy to aid the resumption and encourage continued progress.

I speak for administrative efficiency, for lightened tax burdens, for sound commercial practices, for adequate credit facilities, for sympathetic concern for all agricultural problems, for the omission of unnecessary interference of Government with business, for an end to Government’s experiment in business, and for more efficient business in Government administration. With all of this must attend a mindfulness of the human side of all activities, so that social, industrial, and economic justice will be squared with the purposes of a righteous people…

If revolution insists upon overturning established order, let other peoples make the tragic experiment. There is no place for it in America. When World War threatened civilization we pledged our resources and our lives to its preservation, and when revolution threatens we unfurl the flag of law and order and renew our consecration. Ours is a constitutional freedom where the popular will is the law supreme and minorities are sacredly protected…

It has been proved again and again that we cannot, while throwing our markets open to the world, maintain American standards of living and opportunity, and hold our industrial eminence in such unequal competition. There is a luring fallacy in the theory of banished barriers of trade, but preserved American standards require our higher production costs to be reflected in our tariffs on imports. Today, as never before, when peoples are seeking trade restoration and expansion, we must adjust our tariffs to the new order. We seek participation in the world’s exchanges, because therein lies our way to widened influence and the triumphs of peace. We know full well we cannot sell where we do not buy, and we cannot sell successfully where we do not carry. Opportunity is calling not alone for the restoration, but for a new era in production, transportation and trade. We shall answer it best by meeting the demand of a surpassing home market, by promoting self- reliance in production, and by bidding enterprise, genius, and efficiency to carry our cargoes in American bottoms to the marts of the world.

We would not have an America living within and for herself alone, but we would have her self-reliant, independent, and ever nobler, stronger, and richer. Believing in our higher standards, reared through constitutional liberty and maintained opportunity, we invite the world to the same heights. But pride in things wrought is no reflex of a completed task. Common welfare is the goal of our national endeavor. Wealth is not inimical to welfare; it ought to be its friendliest agency. There never can be equality of rewards or possessions so long as the human plan contains varied talents and differing degrees of industry and thrift, but ours ought to be a country free from the great blotches of distressed poverty. We ought to find a way to guard against the perils and penalties of unemployment. We want an America of homes, illumined with hope and happiness, where mothers, freed from the necessity for long hours of toil beyond their own doors, may preside as befits the hearthstone of American citizenship. We want the cradle of American childhood rocked under conditions so wholesome and so hopeful that no blight may touch it in its development, and we want to provide that no selfish interest, no material necessity, no lack of opportunity shall prevent the gaining of that education so essential to best citizenship.

There is no short cut to the making of these ideals into glad realities. The world has witnessed again and again the futility and the mischief of ill-considered remedies for social and economic disorders. But we are mindful today as never before of the friction of modern industrialism, and we must learn its causes and reduce its evil consequences by sober and tested methods. Where genius has made for great possibilities, justice and happiness must be reflected in a greater common welfare.

Service is the supreme commitment of life. I would rejoice to acclaim the era of the Golden Rule and crown it with the autocracy of service. I pledge an administration wherein all the agencies of Government are called to serve, and ever promote an understanding of Government purely as an expression of the popular will.

Inaugural Address of Warren G. Harding, March 4, 1921, http://avalon.law.yale.edu/20th_century/harding.asp.

The Depression of 1920 is the basic economic counter-argument to Big Government Keynesian stimulus, which didn’t work in the Great Depression, nor will it work now. I haven’t seen a good counter-argument from the Keynesians against this episode.

The conventional wisdom holds that in the absence of government countercyclical policy, whether fiscal or monetary (or both), we cannot expect economic recovery — at least, not without an intolerably long delay. Yet the very opposite policies were followed during the depression of 1920–1921, and recovery was in fact not long in coming.

The economic situation in 1920 was grim. By that year unemployment had jumped from 4 percent to nearly 12 percent, and GNP declined 17 percent…

Instead of “fiscal stimulus,” Harding cut the government’s budget nearly in half between 1920 and 1922. The rest of Harding’s approach was equally laissez-faire. Tax rates were slashed for all income groups. The national debt was reduced by one-third.

The Federal Reserve’s activity, moreover, was hardly noticeable. As one economic historian puts it, “Despite the severity of the contraction, the Fed did not move to use its powers to turn the money supply around and fight the contraction.”[2] By the late summer of 1921, signs of recovery were already visible. The following year, unemployment was back down to 6.7 percent and it was only 2.4 percent by 1923.

It is instructive to compare the American response in this period to that of Japan. In 1920, the Japanese government introduced the fundamentals of a planned economy, with the aim of keeping prices artificially high.

The great banks, the concentrated industries, and the government got together, destroyed the freedom of the markets, arrested the decline in commodity prices, and held the Japanese price level high above the receding world level for seven years. During these years Japan endured chronic industrial stagnation and at the end, in 1927, she had a banking crisis of such severity that many great branch bank systems went down, as well as many industries. It was a stupid policy. In the effort to avert losses on inventory representing one year’s production, Japan lost seven years…

The federal government did not do what Keynesian economists ever since have urged it to do: run unbalanced budgets and prime the pump through increased expenditures. Rather, there prevailed the old-fashioned view that government should keep taxation and spending low and reduce the public debt…

It is hardly necessary to point out that Harding’s counsel — delivered in the context of a speech to a political convention, no less — is the opposite of what the alleged experts urge upon us today. Inflation, increased government spending, and assaults on private savings combined with calls for consumer profligacy: such is the program for “recovery” in the 21st century.

Not surprisingly, many modern economists who have studied the depression of 1920–1921 have been unable to explain how the recovery could have been so swift and sweeping even though the federal government and the Federal Reserve refrained from employing any of the macroeconomic tools — public works spending, government deficits, and inflationary monetary policy — that conventional wisdom now recommends as the solution to economic slowdowns. The Keynesian economist Robert A. Gordon admitted that “government policy to moderate the depression and speed recovery was minimal. The Federal Reserve authorities were largely passive.… Despite the absence of a stimulative government policy, however, recovery was not long delayed.”[5]

Another economic historian briskly conceded that “the economy rebounded quickly from the 1920–1921 depression and entered a period of quite vigorous growth” but chose not to comment further on this development.[6] “This was 1921,” writes the condescending Kenneth Weiher, “long before the concept of countercyclical policy was accepted or even understood.”[7] They may not have “understood” countercyclical policy, but recovery came anyway — and quickly…

The years preceding 1920 were characterized by a massive increase in the supply of money via the banking system, with reserve requirements having been halved by the Federal Reserve Act of 1913 and then with considerable credit expansion by the banks themselves.

Total bank deposits more than doubled between January 1914, when the Fed opened its doors, and January 1920. Such artificial credit creation sets the boom–bust cycle in motion. The Fed also kept its discount rate (the rate at which it lends directly to banks) low throughout the First World War (1914–1918) and for a brief period thereafter. The Fed began to tighten its stance in late 1919…

If the Austrian view is correct — and I believe the theoretical and empirical evidence strongly indicates that it is — then the best approach to recovery would be close to the opposite of these Keynesian strategies. The government budget should be cut, not increased, thereby releasing resources that private actors can use to realign the capital structure.

The money supply should not be increased. Bailouts merely freeze entrepreneurial error in place, instead of allowing the redistribution of resources into the hands of parties better able to provide for consumer demands in light of entrepreneurs’ new understanding of real conditions. Emergency lending to troubled firms perpetuates the misallocation of resources and extends favoritism to firms engaged in unsustainable activities at the expense of sound firms prepared to put those resources to more appropriate uses…

The experience of 1920–1921 reinforces the contention of genuine free-market economists that government intervention is a hindrance to economic recovery. It is not in spite of the absence of fiscal and monetary stimulus that the economy recovered from the 1920–1921 depression. It is because those things were avoided that recovery came. The next time we are solemnly warned to recall the lessons of history lest our economy deteriorate still further, we ought to refer to this episode — and observe how hastily our interrogators try to change the subject.

The Forgotten Depression of 1920, Thomas E. Woods, Jr., November 27, 2009, http://mises.org/daily/3788.

Warren Harding’s speech had some other interesting quotes related to war, peace, entangling alliances, international trade, etc.:

I am sure our own people will not misunderstand, nor will the world misconstrue. We have no thought to impede the paths to closer relationship. We wish to promote understanding. We want to do our part in making offensive warfare so hateful that Governments and peoples who resort to it must prove the righteousness of their cause or stand as outlaws before the bar of civilization.

We are ready to associate ourselves with the nations of the world, great and small, for conference, for counsel; to seek the expressed views of world opinion; to recommend a way to approximate disarmament and relieve the crushing burdens of military and naval establishments. We elect to participate in suggesting plans for mediation, conciliation, and arbitration, and would gladly join in that expressed conscience of progress, which seeks to clarify and write the laws of international relationship, and establish a world court for the disposition of such justiciable questions as nations are agreed to submit thereto. In expressing aspirations, in seeking practical plans, in translating humanity’s new concept of righteousness and justice and its hatred of war into recommended action we are ready most heartily to unite, but every commitment must be made in the exercise of our national sovereignty. Since freedom impelled, and independence inspired, and nationality exalted, a world supergovernment is contrary to everything we cherish and can have no sanction by our Republic. This is not selfishness, it is sanctity. It is not aloofness, it is security. It is not suspicion of others, it is patriotic adherence to the things which made us what we are…

Amid it all we have riveted the gaze of all civilization to the unselfishness and the righteousness of representative democracy, where our freedom never has made offensive warfare, never has sought territorial aggrandizement through force, never has turned to the arbitrament of arms until reason has been exhausted. When the Governments of the earth shall have established a freedom like our own and shall have sanctioned the pursuit of peace as we have practiced it, I believe the last sorrow and the final sacrifice of international warfare will have been written…

There is something inherently wrong, something out of accord with the ideals of representative democracy, when one portion of our citizenship turns its activities to private gain amid defensive war while another is fighting, sacrificing, or dying for national preservation.

In the U.S. in 2008, we consumed 16 pounds of seafood per person…
U.S. consumers spent an estimated $69.8 billion for fishery products in 2008…
In 2008, imports made up 83% of the seafood consumed in the U.S. The U.S. imported about 5.2 billion pounds of seafood in 2008…
In 2008, the U.S. exported 2.7 billion pounds of seafood, valued at $4.3 billion.

U.S. National Oceanic and Atmospheric Administration (NOAA), U.S. Seafood Facts, http://www.nmfs.noaa.gov/fishwatch/trade_and_aquaculture.htm (2008 Imports and Exports, Fisheries Statistics Division).

According to the National Oceanic and Atmospheric Administration (NOAA), in fiscal year 2007, over 80 percent of the seafood consumed in this country was imported, and shrimp was the most widely consumed seafood. Seafood imports into the United States most frequently come from Canada, China, and Thailand, according to the U.S. Department of Agriculture’s (USDA) Foreign Agriculture Service…

FDA examines only about 2 percent of imported seafood annually

U.S. Government Accountability Office, FDA Program Changes and Better Collaboration among Key Federal Agencies Could Improve Detection and Prevention, February, 2009, http://www.gao.gov/new.items/d09258.pdf.

Of course, a lot of people in this country are asking, What should we do about Afghanistan? It’s a pretty important question. It might be one of the most important questions that we are asking right now. And yet nobody seems to have an answer. I think the difficulty in finding an answer comes sometimes from not having fully understood why we got there. I just can’t imagine this debate that’s going on within our government today, the executive branch, the legislative branch, and with the people–can you imagine this going on during World War II? How many troops should we have? What is our exit strategy? Who is our enemy? How are we going to impose democracy? It’s so far removed from what a traditional responsibility is of our government, which is to provide national security.

Now they have practically run out of excuses for why we are over in Afghanistan. The only one that is left that they seem to cling to is that we are there for national security; we want to fight the bad guys over there because we don’t want to fight them over here. I will talk a little about that later; but, quite frankly, I think that’s a fallacious argument and actually makes things a lot worse.

It just bewilders me about how we get trapped into these situations. I happen to believe that it’s because we get ourselves involved too carelessly, too easily and we don’t follow the Constitution, because under the Constitution, you’re supposed to declare the war, know who your enemy is, and know when you can declare victory and bring the troops home. And we did that up until and through World War II. But since then, that hasn’t been the case.

I recall a book I read in the 1980s written by Barbara Tuchman. She wrote a book called the “March of Folly,” and she went back as far as Troy, all the way up through Vietnam and took very special interest in countries where they were almost obsessed or possessed with a policy, even though it was not in their interest, and the foolishness and the inability to change course. She died in 1989, but I keep thinking that if she had lived, she would probably write a history of our recent years, another “march of folly.”

Just think of what has happened since the Berlin Wall came down and the Soviet system collapsed. It didn’t take us long. Did we have any peace dividends? No. There were arguments for more military spending, we had more responsibility, we had to go and police the world. So it wasn’t long after that, what were we doing? We were involved in the Persian Gulf war.

And then, following that, we had decades of bombing in Iraq which didn’t please the Arabs and the Muslims of the world and certainly the Iraqis, but it had nothing to do with national security.

And then, of course, we continued and accelerated our support of the various puppet governments in the Middle East. In doing so, we actually went to the part of not only supporting the governments, but we started putting troops on their land. And when we had an air base in Saudi Arabia, that was rather offensive. If you understand the people over there, this is a violation of a deeply held religious view. It is considered their holy land; and foreigners, especially military foreigners, are seen as infidels. So if you’re looking for a fight or a problem, just put troops on their land.

But also, as a result of the policy that we have had in the Middle East, we have been perceived as being anti-Palestinian. This has not set well either. Since that time, of course, we haven’t backed off one bit. We had the Persian Gulf war, and then we had 9/11.

We know that 9/11 changed everything. We had 15 individuals from Saudi Arabia, a few from Yemen and a few from Egypt, but, aha, this is an excuse that we have got to get the bad guys. So where are the bad guys? Well, Iraq, of course. Of course, they figured, well, we can’t quite do that, let’s go into Afghanistan. Of course, not one single Afghani did anything to us. They said, oh, no, the al Qaeda visited there.

But I just can’t quite accept the fact that the individuals that were flying those airplanes got their training by going to these training camps in Afghanistan doing push-ups and being tough and strong. What did they do? Where was the planning? The planning was done in Spain and they were accepted there on legal bases. They were done in Germany; they were accepted there. As a matter of fact, they even came to this country with legal visas. And they were accepted by the countries.

And, no, no, we said, it’s the Taliban; it’s the people of Afghanistan, never questioning the fact that a few years back, back in 1989 when the Soviets were wrecking the place, we were allied with the people who were friends of Osama bin Laden, and we were over there trying to support him. So he then was a freedom fighter.

And the hypocrisy of all this and the schizophrenia of it all, they were on again and off again. No wonder we get ourselves into these difficulties. And it doesn’t seem to ever lead up.

The one assessment that was made after Vietnam, and I think you can apply it here, is how do we get in and why do we get bogged down? And two individuals that were talking about this, East and West, Vietnam and the United States, they sort of came to the conclusion that we, the Americans, overestimated the ominous power of our military, we could conquer anybody and everybody. And we underestimated the tenacity of people who are defending their homeland, sort of like we were defending our homeland in the Revolutionary War, and the invaders and the occupiers were the Red Coats. There’s a big difference, and you can overcome all kinds of obstacles; but we have never seemed to have learned that. And unless we do, I don’t think we can solve our problems.

Indeed, we have to realize that we are not the policemen of the world. We cannot nation-build. And Presidential candidates on both sides generally tell the people that’s what they want, and the people say, keep our fingers crossed, hope it’s true. But then, once again, our policies continue down the road, and we never seem to have the energy to back off of this.

I emphasize, once again, that I think we could keep our eye on the target, emphasize what we should be doing if we went to war a lot more cautiously, if we have an enemy that we have to fight in our national defense and then there is a declaration of war…

The statement at the beginning of this war was made that it’s different this time. Even though the history is well known about Afghanistan–it’s ancient history, but it’s different this time because we’re different, and it’s not going to have the same result. But so far, you know, they haven’t caught Osama bin Laden, and we don’t have a national government, really. We don’t have really honest elections. We haven’t won the hearts and minds of the people. There is a lot of dissension, and it is a miserable place. It is really a total failure, let alone the cost, the cost of life and limb and money. I mean, it is just a total failure. The thought that we would pursue this and expand it and send more troops just blows my mind.

I just want to mention a couple of things that I think are bad arguments. One thing is we are involved there, we have invested too much, and, therefore, we have to save face because it would look terrible if we had to leave. But it is like in medicine. What if we, in medicine, were doing the wrong thing, made the wrong diagnosis? Would we keep doing it to prove that we are right or are we going listen to the patient and to the results?

But it seems like politicians don’t lose their license. Maybe they should. Maybe there will be more this year or something. But the other argument they make is, if you take a less militant viewpoint as we all do that we’re not supportive of the troops. The troops don’t believe that. The troops I talk to and the ones Mr. Jones talks to, they know we care about them, and they shouldn’t be put in harm’s way unless it is absolutely necessary.

This other argument is, well, we have got to go over there to kill them because they want to kill us. Well, like I mentioned before, it wasn’t the Afghans that came over here, but if we’re in their country killing them, we’re going to create more terrorists. And the more people we send, the more terrorists, and the more we have to kill. And now it’s spreading. That’s what I’m worried about in this war.

There was one individual–I don’t know his name–but they believed he was in Pakistan, so he was part of the terrorist group, the people who were opposing the occupation. So they sent 15 cruise missiles, drones, over looking for him. It took the 15th one to kill him. But 14 landed, and there was an estimate made that about 1,000 civilians were killed in this manner. How many more terrorists have we developed under those circumstances?

I do want to have 1 minute here to read a quote, and then I will yield back. This quote comes from a Russian general talking to Gorbachev, and Gorbachev went into office in 1985, and this was a year later. The general was talking to Gorbachev. Just think, Gorbachev was in office 1 year. He had the problem. He was trying to get out. He didn’t get out until 1989. But the general says, “Military actions in Afghanistan will soon be 7 years old,” and told Mr. Gorbachev at a November 1986 Politburo session, “There is no single piece of land in this country which has not been occupied by a Soviet soldier. Nonetheless, the majority of the territory remains in the hands of rebels.” It reminds me of the conversation between Colonel Tu and Sumner after Vietnam. And Sumner, our colonel, says, You know, we defeated you in every battle in Vietnam. And Tu looked at him, and he said, Yes, I agree, but it was also irrelevant…

I opened my remarks talking about Barbara Tuchman’s “The March of Folly.” We are on the same course. I would say it’s time to march home. I’m not for sending any more troops. It is very clear in my mind that if the job isn’t getting done and we don’t know what we’re there for, I would say, you know, it’s time to come home, because I fear–and it’s been brought up. Congressman McGovern has brought it up, and everybody’s talked about the finances of this because it is known that all great nations, when they spread themselves too thinly around the world, they go bankrupt. And that is essentially what’s happened to the Soviet system. They fell apart for economic reasons.

So there are trillions of dollars spent in this operation. We’re flat-out broke, a $2 trillion increase in the national debt last year, and it just won’t continue. So we may not get our debate on the floor. We may not be persuasive enough to change this course, but I’ll tell you what, the course will be changed. Let’s hope they accept some of our suggestions, because when a Nation crumbles for financial reasons, that’s much more dangerous than us taking the tough stance and saying, It’s time to come home.

Ron Paul, Future Involvement in Afghanistan, House of Representatives Special Order – November 18, 2009, http://thomas.loc.gov/cgi-bin/query/z?r111:H18NO9-0081: (The March of Folly).

Marshal Sergei Akhromeev (Marshal of the Soviet Union was the highest military rank) quotes to Soviet leader Mikhail Gorbachev:

By the late 1980s, Moscow’s exit strategy was basically the same as Nato’s today – to build up an allied government in Kabul with sufficient trained army and police forces to defend itself, thereby allowing foreign troops to leave.

But even with the backing of a 100,000-strong Soviet army and billions of rubles in aid, the Afghan government struggled to establish its legitimacy and authority much beyond the capital – much like President Hamid Karzai’s Western-backed administration today.

This bleak assessment of the situation in late 1986 by the Soviet armed forces commander, Marshal Sergei Akhromeev, sounds eerily familiar.

“Military actions in Afghanistan will soon be seven years old,” Mr Akhromeev told Mr Gorbachev at a November 1986 Politburo session.

“There is no single piece of land in this country which has not been occupied by a Soviet soldier. Nonetheless, the majority of the territory remains in the hands of rebels.

“The whole problem is that military results are not followed up by political actions. At the centre there is authority; in the provinces there is not.

“We control Kabul and the provincial centres, but on occupied territory we cannot establish authority. We have lost the battle for the Afghan people”.

Soviet lessons from Afghanistan, Andrew North, BBC News, November 18, 2009, http://news.bbc.co.uk/2/hi/south_asia/8365187.stm.

The theory of attrition:

The theory of attrition is essentially concerned with the destruction of the enemy’s mass, his physical forces. It searches for the enemy’s strength, his center of gravity. The attritionist seeks victory by attempting to destroy the forces in the field, necessitating a focus on battle–the tactical event wherein those forces are engaged and destroyed…

Characteristics of attrition theory include an emphasis on the superiority of competing forces, a focus on technology and equipment, primary attention by all command levels to the tactical level of warfare, and the destruction of the enemy’s forces by impact and superior firepower. Since attrition theory focuses on force relationships and relative measures of technological advance, an attritional military organization views warfare as scientific, measurable, and definable. The focus is on the quantifiable, the tangibles of war. Warfare is approached systematically…

Attritionist militaries tend to concentrate on their own capabilities in military planning, identifying enemy “targets” but eschewing overmuch consideration of enemy capability or will. As such, they tend to be weak in intelligence support, assessment of enemy performance, and predictions of enemy intent…

U.S. forces in Vietnam would, for the most part, be categorized as attritional, attempting to engage the enemy on the field of battle. In On Strategy: A Critical Analysis of the Vietnam War, Colonel Harry Summers recalls an April 1975 conversation in which he remarked, “You know you never defeated us on the battlefield,” to which his North Vietnamese counterpart replied, “That may be so, but it is also irrelevant.”

Warfare Theory, Commander Joseph A. Gattuso, Jr., U.S. Navy, 1996, http://www.au.af.mil/au/awc/awcgate/navy/wft-a96.htm (On Strategy: A Critical Analysis of the Vietnam War; The War that Would Not End).

See also, Osama’s own words on 9/11 (occupation of holy land) and the causes of suicide terrorism, and More Americans in Afghanistan now than Soviets at the peak of their War, and Opium Poppy Cultivation.

Too much power makes you stupid.

Gareth Porter, Antiwar Radio, November 25, 2009, http://antiwar.com/radio/2009/11/25/gareth-porter-71/.

The Marine Broadcasting Offences Act, enacted in 1967 in the United Kingdom, extended in 1990 with the Broadcasting Act, and still in force today:

It shall not be lawful for a broadcast to be made from a ship or aircraft… If a broadcast is made from a ship in contravention of the foregoing subsection, the owner of the ship, the master of the ship and every person who operates, or participates in the operation of, the apparatus by means of which the broadcast is made shall be guilty of an offence…

A person guilty of an offence under this Act shall be liable—
(a) on summary conviction, to imprisonment for a term not exceeding six months or to a fine not exceeding £400, or to both;
(b) on conviction on indictment, to imprisonment for a term not exceeding two years or to a fine, or to both.

Marine, &c., Broadcasting (Offences) Act 1967, United Kingdom Acts, http://www.opsi.gov.uk/RevisedStatutes/Acts/ukpga/1967/cukpga_19670041_en_1.

The Communist Manifesto was written in 1848 by Karl Marx and Frederick Engels. It is a short read– 55 pages. It is like angry poetry (e.g. “All that is solid melts into air…” and “The robe of speculative cobwebs…”). Here are some excerpts I found interesting:

The history of all hitherto existing societies is the history of class struggles…

The modern bourgeois society that has sprouted from the ruins of feudal society has not done away with class antagonisms. It has but established new classes, new conditions of oppression, new forms of struggle in place of the old ones. Our epoch, the epoch of the bourgeois, possesses, however, this distinctive feature: it has simplified the class antagonisms. Society as a whole is more and more splitting up into two great hostile camps, into two great classes, directly facing each other: Bourgeois and Proletariat…

We see, therefore, how the modern bourgeois is itself the product of a long course of development, of a series of revolutions in the modes of production and of exchange.

Each step in the development of the bourgeois was accompanied by a corresponding political advance of that class. An oppressed class under the sway of the feudal nobility, an armed and self-governing association in the medieval commune; here independent urban republic (as in Italy and Germany), there taxable “third estate” of the monarchy (as in France), afterwards, in the period of manufacture proper, serving either the semi-feudal or the absolute monarchy as a counterpoise against the nobility, and, in fact, corner-stone of the great monarchies in general, the bourgeois has at last, since the establishment of Modern Industry and of the world market, conquered for itself, in the modern representative State, exclusive political sway. The executive of the modern State is but a committee for managing the common affairs of the whole bourgeois.

The bourgeois, historically, has played a most revolutionary part.

The bourgeois, wherever it has got the upper hand, has put an end to all feudal, patriarchal, idyllic relations. It has pitilessly torn asunder the motley feudal ties that bound man to his “natural superiors,” and has left remaining no other nexus between man and man than naked self-interest, than callous “cash payment.” It has drowned the most heavenly ecstasies of religious fervor, of chivalrous enthusiasm, of philistine sentimentalism, in the icy water of egotistical calculation. It has resolved personal worth into exchange value, and in place of the numberless and feasible chartered freedoms, has set up that single, unconscionable freedom– Free Trade. In one word, for exploitation, veiled by religious and political illusions, naked, shameless, direct, brutal exploitation.

The bourgeois has stripped of its halo every occupation hitherto honored and looked up to with reverent awe. It has converted the physician, the lawyer, the priest, the poet, the man of science, into its paid wage labourers.

The bourgeois has torn away from the family its sentimental veil, and has reduced the family relation to a mere money relation…

The bourgeois cannot exist without constantly revolutionizing the instruments of production, and thereby relations of production, and with them the whole relations of society. Conservation of the old modes of production in unaltered form, was, on the contrary, the first condition of existence for all earlier industrial classes. Constant revolutionizing of production, uninterrupted disturbance of all social conditions, everlasting uncertainty and agitation distinguish the bourgeois epoch from all earlier ones. All fixed, fast-frozen relations, with their train of ancient and venerable prejudices and opinions, are swept away, all new-formed ones become antiquated before they can ossify. All that is solid melts into air, all that is holy is profaned, and man is at last compelled to face with sober senses, his real conditions of life, and his relations with his kind.

The need of a constantly expanding market for its products chases the bourgeois over the whole surface of the globe. It must nestle everywhere, settle everywhere, establish connections everywhere…

The bourgeois, by the rapid improvement of all instruments of production, by the immensely facilitated means of communication, draws all, even the most barbarian, nations into civilization. The cheap prices of its commodities are the heavy artillery with which it batters down all Chinese walls… It compels all nations, on pain of extinction, to adopt the bourgeois mode of production…

The bourgeois has subjected the country to the rule of towns. It has created enormous cities, has greatly increased the urban population as compared with the rural, and has thus rescued a considerable part of the population from the idiocy of rural life…

The bourgeois keeps more and more doing away with the scattered state of the population, of the means of production, and of property. It has agglomerated production, and has concentrated property in a few hands. The necessary consequence of this was political centralization. Independent, or but loosely connected provinces, with separate interests, laws, governments and systems of taxation, became lumped together into one nation, with one government, one code of laws, one national class-interest, one frontier and one customs tariff. The bourgeois, during its rule of scarce one hundred years, has created more massive and more colossal productive forces than have all preceding generations together…

It is enough to mention the commercial crises that by their periodical return put on its trial, each time more threateningly, the existence of the entire bourgeois society. In these crises a great part not only of the existing products, but also of the previously created productive forces, are periodically destroyed. In these crises there breaks out an epidemic that, in all earlier epochs, would have seemed an absurdity– the epidemic of over-production. Society suddenly finds itself put back into a state of momentary barbarism; it appears as if a famine, a universal war of devastation had cut off the supply of every means of subsistence; industry and commerce seem to be destroyed; and why? Because there is too much civilization, too much means of subsistence, too much industry, too much commerce… And how does the bourgeois get over these crises? On the one hand enforced destruction of a mass of productive forces; on the other, by the conquest of new markets, and by the more thorough exploitation of the old ones. That is to say, by paving the way for more extensive and more destructive crises, and by diminishing the means whereby crises are prevented…

In proportion as the bourgeois, i.e., capital, is developed, in the same proportion is the proletariat, the modern working class, developed– a class of laborers, who live only so long as they find work, and who find work only so long as their labor increases capital. These laborers, who must sell themselves piece-meal, are a commodity, like every other article of commerce, and are consequently exposed to all the vicissitudes of competition, to all the fluctuations of the market.

Owing to the extensive use of machinery and to division of labor, the work of the proletarians has lost all individual character, and consequently, all charm for the workman…

The lower strata of the middle class– the small tradespeople, shopkeepers, retired tradesmen generally, the craftsmen and peasants– all these sink gradually into the proletariat, partly because their diminutive capital does not suffice for the scale on which Modern Industry is carried on, and is swamped in the competition with the large capitalists, partly because their specialized skill is rendered worthless by the new methods of production…

But with the development of industry the proletariat not only increases in number; it becomes concentrated in greater masses, its strength grows, and it feels that strength more. The various interests and conditions of life within the ranks of the proletariat are more and more equalized, in proportion as machinery obliterates all distinctions of labor, and nearly everywhere reduces wages to the same low level. The growing competition among the bourgeois, and the resulting commercial crises, make the wages of the workers ever more fluctuating. The unceasing improvement of machinery, ever more rapidly developing, makes their livelihood more and more precarious; the collisions between individual workmen and individual bourgeois take more and more the character of collisions between two classes. Thereupon the workers begin to form combinations (Trades Unions) against the bourgeois…

Now and then the workers are victorious, but only for a time…

This organization of the proletarians into a class, and consequently into a political party, is continually being upset again by the competition between the workers themselves. But it ever rises up again, stronger, firmer, mightier. It compels legislative recognition of particular interests of the workers, by taking advantage of the divisions among the bourgeoisie itself. Thus the ten-hours’ bill in England was carried…

The bourgeois finds itself involved in a constant battle. At first with the aristocracy; later on, with those portions of the bourgeois itself, whose interests have become antagonistic to the progress of industry; at all times, with the bourgeois of foreign countries. In all these battles it sees itself compelled to appeal to the proletariat, to ask for its help, and thus, to drag it into the political arena. The bourgeois itself, therefore, supplies the proletariat with its own instruments of political and general education, in other words, it furnishes the proletariat with weapons for fighting the bourgeoisie…

Finally, in times when the class struggle nears the decisive hour, the process of dissolution going on within the ruling class, in fact within the whole range of society, assumes such a violent, glaring character, that a small section of the ruling class cuts itself adrift, and joins the revolutionary class, the class that holds the future in its hands…

The proletarians… have nothing of their own to secure and to fortify; their mission is to destroy all previous securities for, and insurances of, individual property.

All previous historical movements were movements of minorities, or in the interests of minorities. The proletarian movement is the self-conscious, independent movement of the immense majority, in the interests of the immense majority…

Hitherto, every form of society has been based, as we have already seen, on the antagonism of oppressing and oppressed classes. But in order to oppress a class, certain conditions must be assured to it under which it can, at least, continue its slavish existence. The serf, in the period of serfdom, raised himself to membership in the commune, just as the petty bourgeois, under the yoke of feudal absolutism, managed to develop into a bourgeois. The modern laborer, on the contrary, instead of rising with the progress of industry, sinks deeper and deeper below the conditions of existence of his own class. He becomes a pauper, and pauperism develops more rapidly than the population and wealth. And here it becomes evident, that the bourgeoisie is unfit any longer to be the ruling class in society, and to impose its conditions of existence upon society as an over-riding law. It is unfit to rule because it is incompetent to assure an existence to its slave within his slavery, because it cannot help letting him sink into such a state, that it has to feed him, instead of being fed by him…

The Communists, therefore, are on the one hand, practically, the most advanced and resolute section of the working-class parties of every country, that section which pushes forward all others; on the other hand, theoretically, they have over the great mass of the proletariat the advantage of clearly understanding the line of march, the conditions, and the ultimate general results of the proletarian movement.

The immediate aim of the Communist is the same as that of all the other proletarian parties: formation of the proletariat into a class, overthrow of the bourgeois supremacy, conquest of political power by the proletariat…

…the theory of Communists may be summed up in the single sentence: Abolition of private property…

To be a capitalist, is to have not only a purely personal, but a social status in production. Capital is a collective product, and only by the united action of many members, nay, in the last resort, only by the united action of all members of society, can it be set in motion…

In bourgeois society, living labor is but a means to increase accumulated labor. In Communist society, accumulated labor is but a means to widen, to enrich, to promote the existence of the laborer…

And the abolition of this state of things is called by the bourgeois, abolition of individuality and freedom! And rightly so. The abolition of bourgeois individuality, bourgeois independence, and bourgeois freedom is undoubtedly aimed at…

Do you charge us with wanting to stop the exploitation of children by their parents? To this crime we plead guilty…

And your education! Is not that also social, and determined by the social conditions under which you educate, by the intervention, direct or indirect, of society, by means of schools, etc.? The Communists have not invented the intervention of society in education; they do but seek to alter the character of that intervention, and to rescue education from the influence of the ruling class…

In proportion as the exploitation of one individual by another is put an end to, the exploitation of one nation by another will also be put an end to. In proportion as the antagonism between classes within the nation vanishes, the hostility of one nation to another will come to an end…

When the ancient world was in its last throes, the ancient religions were overcome by Christianity. When Christian ideas succumbed in the 18th century to rationalist ideas, feudal society fought its death battle with the then revolutionary bourgeois. The ideas of religious liberty and freedom of conscience merely gave expression to the sway of free competition within the domain of knowledge…

… one fact is common to all past ages, viz., the exploitation of one part of society by the other. No wonder, then, that the social consciousness of past ages, despite all the multiplicity and variety it displays, moves within certain common forms, or general ideas, which cannot completely vanish except with the total disappearance of class antagonisms…

The proletariat will use its political supremacy to wrest, by degrees, all capital from the bourgeoisie, to centralize all instruments of production in the hands of the State, i.e., of the proletariat organized as the ruling class; and to increase the total of productive forces as rapidly as possible…

… the following will be pretty generally applicable.

1. Abolition of property in land and application of all rents of land to public purposes.

2. A heavy progressive or graduated income tax.

3. Abolition of all right of inheritance.

4. Confiscation of the property of all emigrants and rebels.

5. Centralization of credit in the hands of the State, by means of a national bank with State capital and an exclusive monopoly.

6. Centralization of the means of communication and transport in the hands of the State.

7. Extension of factories and instruments of production owned by the State; the bringing into cultivation of waste-lands, and the improvement of the soil generally in accordance with a common plan.

8. Equal liability of all to labor. Establishment of industrial armies, especially for agriculture.

9. Combination of agriculture with manufacturing industries; gradual abolition of the distinction between town and country, by a more equable distribution of the population over the country.

10. Free education for all children in public schools. Abolition of children’s factory labor in its present form. Combination of education with industrial production, etc., etc…

In countries like France, where the peasants constitute far more than half of the population, it was natural that writers who sided with the proletariat against the bourgeoisie, should use, in their criticism of the bourgeois regime, the standard of the peasant and petty bourgeois, and from the standpoint of these intermediate classes should take up the cudgels for the working class. Thus arose petty-bourgeois Socialism. Sismondi was the head of this school, not only in France but also in Englang.

This school of Socialism dissected with great acuteness the contradictions in the conditions of modern production. It laid bare the hypocritical apologies of economists. It proved, incontrovertibly, the disastrous effects of machinery and division of labor; the concentration of capital and land in a few hands; overproduction and crises; it pointed out the inevitable ruin of the petty bourgeois and peasant, the misery of the proletariat, the anarchy in production, the crying inequalities in the distribution of wealth, the industrial war of extermination between nations, the dissolution of old moral bonds, of the old family relations, of the old nationalities.

In its positive aims, however, this form of Socialism aspires either to restoring the old means of production and of exchange, and with them the old property relations, and the old society, or to cramping the modern means of production and of exchange, within the framework of the old property relations that have been, and were bound to be, exploded by these means. In either case, it is both reactionary and Utopian.

Its last words are: corporate guilds for manufacture, patriarchal relations in agriculture…

The robe of speculative cobwebs, embroidered with flowers of rhetoric, steeped in the dew of sickly sentiment, this transcendental robe in which the German Socialists wrapped their sorry “eternal truths,” all skin and bone, served to wonderfully increase the sale of their goods amongst such a public. And on its part, German Socialism recognized, more and more, its own calling as the bombastic representative of the petty-bourgeois Philistine…

A part of the bourgeoisie is desirous of redressing social grievances, in order to secure the continued existence of bourgeois society.

To this section belong economists, philanthropists, humanitarians, improvers of the condition of the working class, organizers of charity, members of societies for the prevention of cruelty to animals, temperance fanatics, hole-and-corner reformers of every imaginable kind. This form of Socialism has, moreover, been worked out into complete systems…

The Socialist bourgeois want all the advantages of modern social conditions without the struggles and dangers necessarily resulting therefrom. They desire the existing state of society minus its revolutionary and disintegrating elements. They wish for a bourgeoisie without a proletariat. The bourgeoisie naturally conceives the world in which it is supreme to be the best; and bourgeois Socialism develops this comfortable conception into various more or less complete systems. In requiring the proletariat to carry out such a system… it but requires in reality, that the proletariat should remain within the bounds of existing society, but should cast away all its hateful ideas concerning the bourgeoisie.

A second and more practical, but less systematic, form of this Socialism sought to depreciate every revolutionary movement in the eyes of the working class, by showing that no mere political reform, but only a change in the material conditions of existence, in economic relations, could be of any advantage to them. By changes in the material conditions of existence, this form of Socialism, however, by no means understands abolition of the bourgeois relations of production, an abolition that can be effected only by a revolution, but administrative reforms, based on the continued existence of these relations; reforms, therefore, that in no respect affect the relations between capital and labor, but, at the best, lessen the cost, and simplify the administrative work, of bourgeois government…

Free trade: for the benefit of the working class. Protective duties: for the benefit of the working class. Prison Reform: for the benefit of the working class. This is the last word and the only seriously meant word of bourgeois Socialism.

It is summed up in the phrase: the bourgeois is a bourgeois– for the benefit of the working class…

The Communists disdain to conceal their views and aims. They openly declare that their ends can be attained only by the forcible overthrow of all existing social conditions. Let the ruling classes tremble at a Communistic revolution. The proletarians have nothing to lose but their chains. They have a world to win.

WORKING MEN OF ALL COUNTRIES, UNITE!

… Prefaces …

The basic thought running through the Manifesto– that economic production, and the structure of society of every historical epoch necessarily arising therefrom, constitute the foundation for the political and intellectual history of that epoch; that consequently (ever since the dissolution of the primeval communal ownership of land) all history has been a history of class struggles, or struggles between exploited and exploiting, between dominated and dominating classes at various stages of social evolution; that this struggle, however, has now reached a stage where the exploited and oppressed class (the proletariat) can no longer emancipate itself from the class which exploits and oppresses it (the bourgeoisie), without at the same time forever freeing the whole of society from exploitation, oppression, class struggles– this basic thought belongs solely and exclusively to Marx…

… Socialists… on the other hand, the most multifarious social quacks who, by all manner of tinkering, profess to redress, without any danger to capital and profit, all sorts of social grievances, in both cases men outside the working-class movement, and looking rather to the “educated” classes for support… Socialism was a middle class movement, communism a working-class movement.

The Communist Manifesto: Complete With Seven Rarely Published Prefaces (Paperback), Marx and Engels, http://www.amazon.com/gp/product/1599869950.

It’s interesting to see how critical Marx and Engels are of Socialism.

As I understand their argument for Communism:

1. Bourgeois break the shackles of feudalism/aristocracy/totalitarianism with freedom of thought and exchange (Capitalism).
2. Bourgeois treat workers (proletarians) as a commodity, and technological innovation trivializes their roles and pay over time… thus capital is centralized with a few Bourgeoisie.
3. Centralized capital leads to centralized government.
4. Bourgeois in centralized government pander to the proletarians.
5. Proletarians piece-meal gather influence over the Bourgeois.
6. As Marx and Engels would have it, at this point, Proletarians overthrow Bourgeois.
   1. Alternatively, and more commonly, Socialists (“multifarious social quacks”) profess to redress grievances with all manner of tinkering.

Theoretical inflection point appears to be at #2. The Libertarian would probably argue that it is instead:

1. Bourgeois break the shackles of feudalism/aristocracy/totalitarianism with freedom of thought and exchange (Capitalism).
2. Certain Bourgeoisie use government power to centralize capital under the guise of protecting the consumer (e.g. Interstate Commerce Commission), which leads to further distortion, further government intervention, and further Government and Bourgeois centralization of power. Centralized government credit destabilizes society causing crises and further government growth.
3. Centralized government leads to further centralized capital (the opposite of #3 above).
4. Continue as above.

The Telegraph, Smiling great white shark: underwater photographer Amos Nachoum gets close to Jaws, http://www.telegraph.co.uk/earth/earthpicturegalleries/6493200/Smiling-great-white-shark-underwater-photographer-Amos-Nachoum-gets-close-to-Jaws.html.

Charlie Rose: All negotiations seem to me to come down to pride and fear.

Mohamed ElBaradei: Yes.

Charlie Rose interviewing Mohamed ElBaradei, November 06, 2009, http://www.charlierose.com/.

Charlie’s new site design sucks — there’s no way to embed, share, download, or link to a specific interview. Charlie is still the best interviewer around though. To watch, click Archive in the player and find the clip.

Federal Reserve Bank of St. Louis, Series: BUSLOANS, Commercial and Industrial Loans at All Commercial Banks, http://research.stlouisfed.org/fred2/series/BUSLOANS?cid=49.

While financial institutions including Citigroup Inc. and Bank of America Corp. have received more than $200 billion in capital from the government, they are limiting loans at a time of mounting unemployment, rising company bankruptcies and increasing regulatory oversight. Commercial and industrial lending has dropped 17 percent since October 2008, according to Federal Reserve data…

Much of the policy makers’ focus is on credit for small businesses, which have generated 64 percent of net new jobs during the past 15 years, according to the government, and can’t tap the capital markets for finance, unlike their bigger brethren…

Banks are receiving “mixed messages” from regulators and policy makers, says the banker association’s Chessen. “On the one hand we’re being told to be more cautious and increase capital, while on the other we’re told to lend more aggressively,” he says.

Supervisors have increased oversight, questioning loans already on the books when they come up for renewal. “It’s the worst of back-seat driving,” Chessen says.

Geithner Saying Be Like Buffett Can’t Make Banks Lend, Rich Miller, Bloomberg, November 9, 2009, http://www.bloomberg.com/apps/news?pid=20601087&sid=a7qDuw9C0YY4&pos=7.

Ultimately lending to businesses was the primary argument for the bank bailout.

U.S. President George W. Bush signed a $700 billion financial-market rescue plan into law, calling it a “decisive action to ease the credit crunch that is now threatening our economy.”…

“There were a number of members of Congress who had voted no that I talked to,” Obama said in Glenside, Pennsylvania.

“And I think more than anything what they wanted was some assurance that this $700 billion was not going to a few banks but that in fact, that it is designed to ensure that the credit markets are working for Main Street.”

Bush Signs Bank Rescue to End “Threat to Economy,” Christopher Stern and Laura Litvan, October 4, 2008, http://www.bloomberg.com/apps/news?pid=20601103&refer=news&sid=ad4VH6tMLj9Y.

So where is all the money? Banks have $850 billion parked at the Federal Reserve, earning interest. Because of fractional reserve banking at approximately a 10% multiplier, that’s a potential $8.5 trillion parked at The Fed. The Federal Reserve pays banks interest on their excess reserves held (depending on the interest rate).

Federal Reserve Bank of St. Louis, Series: EXCRESNS, Excess Reserves of Depository Institutions, http://research.stlouisfed.org/fred2/series/EXCRESNS?cid=50.

Following a lawsuit filed by the American Civil Liberties Union, the Transportation Security Administration (TSA) has revised its policies governing airline passenger screening to make clear that TSA agents are authorized to conduct searches related to safeguarding flight safety, not to engage in general law enforcement. Calling the policy changes a victory for civil liberties, the ACLU has moved to drop its lawsuit, originally filed in June on behalf of a traveler who was illegally detained and harassed by TSA agents at the airport after they discovered he was carrying approximately $4,700 in cash.

TSA Fixes Search Policy After ACLU Sues, ACLU, November 10, 2009, http://www.aclu.org/national-security/tsa-fixes-search-policy-after-aclu-sues.

On March 29, 2009, Steven Bierfeldt was detained in a small room at Lambert-St. Louis International Airport and interrogated by Transportation Security Administration (TSA) officials for nearly half an hour after he passed a metal box containing cash through a security checkpoint X-ray machine. Bierfeldt was carrying the cash in connection with his duties as the Director of Development for the Campaign for Liberty, a political organization that grew out of Congressman Ron Paul’s presidential campaign…

On June 18, 2009, the ACLU filed a complaint on behalf of Bierfeldt, charging that TSA is subjecting innocent Americans to unreasonable searches and detentions that violate the Constitution.

Audio Recording of ACLU Client Steve Bierfeldt’s Detention and Interrogation by the TSA, American Civil Liberties Union (ACLU), http://www.aclu.org/national-security/audio-recording-aclu-client-steve-bierfeldts-detention-and-interrogation-tsa.

Steve tapped his iPhone to secretly record the interrogation. Video+audio+the internet is the new gun against government intrusions on liberty.

Audio clip: Adobe Flash Player (version 9 or above) is required to play this audio clip. Download the latest version here. You also need to have JavaScript enabled in your browser.

Screening may not be conducted to detect evidence of crimes unrelated to transportation security. However, if such evidence is discovered, TSA shall refer it to a supervisor or a law enforcement official for appropriate action… Although an individual may be requested to wait until law enforcement arrives, he or she is free to leave the checkpoint once applicable screening requirements have been completed successfully…

Traveling with large amounts of currency is not illegal… As a general matter, there should be no reason to ask questions of the passenger about currency, although there may be times when questions are warranted by security needs. When currency appears to be indicative of criminal activity, TSA may report the matter to the appropriate authorities… For international flights, currency that exceeds $10,000 may not be transported into or out of the United States unless it has been reported to Customs and Border Protection (CBP). TSA may notify CBP and/or law enforcement authorities pursuant to its standard operating procedures that the individual possesses a sum of currency.

Declaration of William Switzer, United States District Court, District of Columbia, No. 09-cv-Ol117, Steven Bierfeldt v Janet Napolitano, Secretary, Department of Homeland Security, September 4, 2009, http://www.aclu.org/files/assets/TSA.Switzer_Decl_attachments_1_2_and_3_0.pdf.