HALF-FULL REPORT 08/05/11
Bagnoli, Naples, Italy. Who knew Hell could be so beautiful? I'm sitting in a flower garden overlooking the Mediterranean. In front of me is the islet of Nisida, where at his villa, Marcus Junius Brutus (85-42 BC) and his conspirators planned the assassination of Julius Caesar. Off to the left looms Mount Vesuvius, and in the distance is the Isle of Capri. On the other side of the hill behind me lies The Solfatara, a volcanic crater filled with boiling mud pools and vents hissing and steaming with sulfuric gasses. For the Romans, it was feared as the home of Vulcan, the god of fire. Next to Solfatara lies a crater lake called Avernus, Lake Averno. For thousands of years, from Homer in The Odyssey, to Virgil in The Aeneid, to Dante in The Divine Comedy, it was revered as the entrance to Hell. My wife and I are not here to go to hell, but to visit our son who, as a USMC Captain, is stationed at the NATO Command nearby that is running the war in Libya. Nonetheless, this seems a uniquely appropriate place from which to write this HFR as America is descending into economic and political purgatory.
RENDEZVOUS XI – “October 7-9” Washington DC
Here we go, guys n' gals, diving into the heart of the beast, Washington DC, for our eleventh TTP Rendezvous. Miko has once again scored us a great deal at the Key Bridge Marriott, with its fabulous location overlooking the Potomac River right at Key Bridge (named after Francis Scott Key who penned the Star-Spangled Banner). A short walk across it and you're into the shops and watering holes of Georgetown. We'll be there at the most beautiful time of year, when the weather is at its best and the fall colors are in full array. Our focus will be on solutions - how our country and us personally can get out of the mess Zero has dug us into. Which is why financial guru Hank Brock, author of Your Complete Guide to Money Happiness, will be speaking to us again on Protecting your assets and lifestyle from the coming crisis -- and even profiting from it. Hank blew us away in Vegas with his detailed practical advice on what really to do - and nobody knows more about it worldwide than Hank. It'll be worth attending RXI just to talk to him. For the gun-lovers - and who among TTPers isn't? - we have a special surprise: my friend Larry Pratt, founder and president of Gun Owners of America, will be joining us. (Edd Forke is jumping up and down now...)
AMERICA THE AUTOPHAGOUS
What was it I said about sausage and the law last week? What emerged as "the debt ceiling deal" since could not possibly be called edible sausage. It is such a putrid malodorous maggot-infested dog's breakfast that no non-deranged dog would eat it. Yet it's only the appetizer. The main course America is dining on today is itself. Autophagous mean "self-devouring." Our country is committing suicide by devouring itself. America has become an autophagous nation. I always request a window seat on an airplane. No matter how many times I've flown across the US, I always see something memorably beautiful I've never seen before. To see that beauty below is so heartbreaking now, to gaze down upon such a blessed land so perversely destroying its blessings. Washington DC has long been a fetid fever swamp of political insanity - but the level of lunacy is now full-on psychotic, and on both sides. Both the Dems and the Pubs, both the enemedia and the normally more sane punditry. The editorial writers at the Wall Street Journal were smoking crack when they wrote A Tea Party Triumph on Monday (8/01). To call a $2.4 trillion debt increase a "victory for the forces of smaller government" is way beyond delusional. We're into Flat Earthism here. Folks, the Tea Party Reagan Republicans have been screwed blue and tattooed by Boehner & Co. They got nothing, while Zero got exactly what he wanted all along - enough funny money trillions to spend all the way to his re-election.
THE SUPERCOMMITTEE IS DANGEROUS TO OUR NATIONAL SECURITY
At this writing, many details of the debt-ceiling deal wrangled out over the weekend remain fuzzy. One thing is clear, unfortunately: The national security of the United States is going to suffer greatly. The Pentagon stands to be whacked by as much as half of the $1.5 trillion that an as-yet-undesignated congressional "supercommittee" is supposed to come up in "deficit reduction" by Thanksgiving. The trouble is that more than $400 billion has already been cut from our national security investments over the past few years. Thus even if no further reductions are made in the spending allocated to defending our people and interests around the world, we will see ominous reductions in the capabilities needed to meet those vital responsibilities. The warnings of what will befall our military and country as a result are beginning to accumulate.
THE PROBLEM: THERE ARE MORE TAXTAKERS THAN TAXPAYERS
Many a democracy has been upended by excessive government spending - and, unfortunately, America, despite the latest budget agreement, is well on its way to fiscal and, perhaps, democratic collapse. As long as those receiving government benefits are much smaller in number than those paying for the benefits, politicians are more dependent on the taxpayers than on the beneficiaries. But the United States has reached the point at which there are more people receiving government checks than paying income taxes. As the political balance shifts away from taxpayers to recipients, the pressures to increase government spending accelerate until finally the golden goose is fully plucked and the economy collapses. President Obama is the agent and spokesperson for the taxtakers and not the taxpayers, which is why he keeps arguing for tax increases and saying it is only ‘fair' that the rich pay more.
THE DEATH THROES OF THE LEFT
The tsunami is just offshore. The national debt is approaching 100 percent of GDP. Unfunded liabilities in entitlement programs exceed $100 trillion. The U.S. is near a "tipping point" where the interest we must pay on our debt exceeds our rate of economic growth, warns the Bank of International Settlements. But our political "leaders" are still sunning themselves on the beach. For Democrats, posturing for the next election is more important than solving our fiscal problems. The primary goals of President Barack Obama and Senate Majority Leader Harry Reid in the debt ceiling negotiations were to hold reductions in spending to an absolute minimum, and to postpone another debate on raising the debt ceiling until after the 2012 elections. They have succeeded. So it's business as usual in Washington D.C. But beyond the beltway, people are worried, and they're getting angry. A Pew poll published July 22 indicates two demographics that have been heavily Democratic for decades -- whites with incomes under $30,000 and people under age 30 -- now lean Republican. Apparently they prefer having jobs to class warfare. We may be on the verge of the biggest paradigm shift in our politics since the Great Depression.
CLEAVER AND SATAN
Black Caucus chairman Democrat Congressman Emanuel Cleaver of Missouri produced a headline-garnering sound bite following the passage in Congress of the debt ceiling compromise bill. Even as this bill didn't by any means manage to demonstrate Congress's serious understanding of economic reality, Cleaver said that the bill amounts to "a sugar-coated Satan sandwich" - by which he meant that it amounts to the defiance of centuries of teachings of the world's greatest religions about how one must look out for the poor and needy as one lives one's life. Most all religions do implore us to lend those in need a hand, to help the poor and indigent. Indeed, there is no ethical system that doesn't make some room for this idea. Yet the use to which Rep. Cleaver wants to put this idea is quite perverse. He doesn't urge us to be generous, kind, compassionate, charitable and such. No, he urges us to engage in robbery and to use the loot we obtain by this means to provide help to those the robbers believe should get some of it.
CUTTING THREE GORDIAN KNOTS
[Note from JW: Skye posted this response to Disraeli's Tea on the Forum, which by TTPer acclamation was requested to be a full article. Happy to comply. Also - as I have been on the road so much, Jack Kelly was to write the HFR this week but is unable to do so for health reasons. I apologize for there being no HFR today.] The central government has become so titanic that slowing its rate of growth would simply slightly delay the inevitable crash. The Federalies must be cut down to size, and voting NO on the debt limit increase is currently our best chance for doing so. Vote NO on increasing the debt limit. The deficits must be stopped or America will be pushed over the economic cliff onto the ash heap of history where it will join the Soviet Union. If the deficits are not stopped now, then when? But if they are, you can then cut three Gordion Knots at once that have hogtied our economy.
DISRAELI’S TEA
Benjamin Disraeli (1804-1881), one of Victorian England's most prominent Prime Ministers (1868/1874-1880), once commented to a friend: "There are two things that the public should never be allowed to see how they are made: sausage and the law." We are witnesses today of just how immortally trenchant Disraeli was back in the 19th century. For in truth, observing our politicians handling the current "debt crisis" is a far more repulsive sight than the inside of a sausage factory. If Disraeli were here now, he'd smile sardonically and remind us that (he was fluent in French) plus ça change, plus c'est la même chose - the more things change, the more they stay the same. Yet there has emerged a conservative movement determind to put an end to this: the Tea Parties. I have spent the last week criss-crossing the country meeting with Tea Party leaders. My jaunt was capped by a private dinner last night with three Congressmen at the home of one of them on Capitol Hill. While I can't quote any of these folks by name, here's what they said. First the Tea Party leaders.
WHERE’S ALEXANDER?
The kingdom of Phyrgia in what is now western Turkey was leaderless, and wracked by civil unrest. The elders consulted an oracle, who told them their next king would come riding in a wagon. As the elders were discussing the prophecy, a peasant rode into town in an oxcart. They made the bewildered man, named Gordius, king. In gratitude, he dedicated his oxcart to the god Zeus, tying it with an intricate knot to a pole in front of the temple. There the oxcart remained for many years, and another legend arose. Whoever could loosen the Gordian Knot would rule all of Asia. Thousands tried, none succeeded. Then, in 333 B.C., along came Alexander the Great. According to yet another legend, instead of trying to untie the knot like all before him, he simply drew his sword and cut it apart. (Aristobulus, a contemporary, said Alexander actually loosed the famous oxcart by pulling the pin out of the pole to which the yoke was tied.) Whatever. Alexander went on to conquer Asia, and ever since the Gordian Knot has been a metaphor for how to solve the apparently unsolvable. So why isn't it being applied to our seemingly intractable economic problems today?