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03/26/2004 Archived Entry: ""
For your grinning pleasure: Mike Luckovich's latest cartoon "Spin Control"; Tom Toles' on the same theme "Spin Monkeys"; Ben Sargent's "Anagram Man".
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Onto political and other commentary...
The first word goes to Gordon Pusch who sends along an article from the Atlantic Monthly entitled The Armageddon Plan." Gordon states the theme succinctly, "Rumsfeld and Cheney were two of the architects of a secret plan during the Reagan Administration to totally disregard the Constitutional Rules of Succession in the event the President was killed in a nuclear attack, and instead establish a `Shadow Government' of their own design." To quote the article, "...'One of the awkward questions we faced,' one participant in the planning of the program explains, `was whether to reconstitute Congress after a nuclear attack. It was decided that no, it would be easier to operate without them'..." That program explains a great deal about the behavior of the Bush Administration after 9/11, e.g. its sidestepping Congressional approval for war.
I continue to be pessimistic about the long-term economic prospect, which I believe will be -- and, perhaps, already is -- stagflation. I think we are still marginally within an inflation-driven bubble created by Bush's white-hot printing presses spitting out currency over the last three years. (Is Bush a sado-monetarist?}But there are signs that the bubble is beginning to dissolve, e.g. the record high price of silver, grocery prices that seem to rise weekly. Although controversy swirls around the honesty -- or lack thereof -- with which the Bush administration is crunching out current unemployment figures, I'm willing to take the official numbers at face value. For example, the official figures for February broke even: no real jobs were lost or created. (The Bush administration later revised its released figures downward by 31,000 jobs so the preceding statement may be overly generous, especially since it doesn't reflect the population growth by which more people are competing for the same employment.) By "real jobs", I mean "private sector" ones in which employees produce goods/services that are demanded on the free market. 21,000 jobs were created in February...in the public sector. These latter jobs actually have a negative impact on the economy as the employees produce nothing of market value while consuming tax dollars in the pursuit of activities that often hinder real productivity, e.g. by enforcing regulations.
Bush will do everything he can to keep the economic bubble intact until after the November election. The Bush administration has gone so far as to attempt to pressure/bribe OPEC -- an organization that Cato Institute correctly observes is no friend to the US. Friendly or not, Bush needs the supply of gas to increase rather than drop as it seems ready to do. Scarcity and high prices would devastate the large chunk of domestic tourism that comes from families piling into the car or RV and hitting the road, which has become ever more popular since air travel went Orwellian. What kind of behind-the-scenes negotiations will the Bush people conduct with Arab and Muslim nations; what trade-offs will be hammered out? Of course, further meddling with prices and supplies will make a post-November collapse deeper and prolonged.
It is not merely or even primarily the federal government against which people should protect themselves financially. For one thing, it is largely beyond your control to defend yourself against the feds. Even "gold bugs" won't escape the impact of massive currency inflation, for example on the value of their homes. It is difficult to even comprehend, let alone grapple with, the immensity of federal foolhardiness...and media reports are as unreliable as they are confusing. For example, on 03/14/04, CNN reported "Republicans pushed a $2.36 trillion budget through the Senate early Friday." On 03/25, the Dodge City Daily Globe reported, "Republicans muscled a $2.41 trillion budget through the House on Thursday." If I took the time, I could probably find out why the budged passed by the House is .07 trillion more than that passed by the Senate... As it is, I'll take it all on face-value because the most important focus should be on protecting yourself from the ongoing and upcoming monetary grab by governments, large and small.
The greatest threat to your financial wellbeing is closer to home than Washington D.C.. Most of the state and local governments are beginning what may be a long looting rampage. They have to. Consider Ohio. Although the state has cut back drastically on services, its budget shortfalls continue. Most worrisome are the population figures. "As the Baby Boomer generation ages, the number of elderly residents in Ohio will skyrocket. Indeed, the number of 85 and over residents is expected to reach one million by 2050. And while Ohio's 65 and older population is now growing slowly now, it is projected to jump from 13 percent in 2000 to 20 percent in 2030." Meanwhile, employment-aged population is leaving due to the tax structure. Medicaid alone could bankrupt Ohio. Of course, dismantling Medicaid would be a solution but how likely is it that a politician in Ohio will propose that remedy when so much of the electorate is senior? State after state will be dealing with similar problems.
On 03/09, I blogged on a similar theme and wrote, "My purpose is not doom-and-gloom but to warn you once more to get out of debt, save as much money as you can, get out of US $ if possible (if you can't afford precious metals, then stock your pantry with nonperishable goods that you regularly use), and beware of the multitudinous ways in which local, county, and state bureaucracies are going to try to nickle and dime you into destitution....The methods they can devise to part you with from money are almost unlimited. In Indiana, for example, one town is beginning to bill non-residents for police time consumed in traffic accident on highways within 15 miles of the town." As I surf the news, I keep coming across novel and creative methods the bureaucrats are devising to bleed people dry. Nashville, for instance, the possibility of requiring landlords to have their properties inspected once every two years to obtain a rental license." In an article entitled "Goodbye DC," Matt Gaffney writes, "I received a piece of mail from the DC [City] government today informing me that I need to pay them $250 for one of my businesses for something called a 'Business Corporation Report.' This involves me filling out a one-page report and sending them a $250 check. This is separate from a $200 payment I had to send them last year for something called a 'Master Business License,' which also involved me sending them a check and filling out a one-page form. This is separate for an acronym called CHOP, which 'allows' me to operate a small business out of my home, and for which I had to fill out a one-page form and send them a check for $50. This is all in addition to the 9% DC state tax I pay and 5.75% sales tax. Plus there's an 11% DC restaurant tax." His solution: moving to Pennsylvania.
And, so, let me add one more piece of advice on how to protect yourself. If it is at all feasible, leave or do not move into jurisdictions that have serious budget problems: their fiscal woes will become your own. How do you know whether that quaint township with white picket fences is actually bankrupt? Go to the city or county and ask for the public documents on their budgets. Ask a real estate agent how much house taxes have risen in the last five years.
Best to all,