Get Government Out Of Student-debt Business

May 17, 2013 By 1 Comment

us capitol building SC Get government out of student debt business

As millions of students and their parents are preparing for life after commencement, they’re also preparing to deal with massive student loans. Increasingly, people are concerned about the student debt situation brewing on college campuses. The present state of student debt is not a pretty picture.

According to a report published by the New York Federal Reserve Bank, college students are borrowing more than ever and debt delinquency is on the rise. Student debt almost tripled between 2004 and 2012 and is now just over $1 trillion. In fact, student debt is the only kind of household debt to rise during the Great Recession and is now second only to mortgage debt in magnitude. At the same time, for all age groups the share of borrowers who are more than 90 days delinquent on their student loan repayment has almost doubled.

Some, like Federal Reserve Chairman Ben Bernanke, claim that student debt is not inflating a higher education bubble that will cause a financial crisis, because the vast majority of student loans are backed by the U.S. government. The taxpayers are on the hook and not the banks, so banks will not be in financial distress if students default.

Bernanke’s claim is revealing. It’s clear that he thinks that the financial system is the economy. It seems that if the financial system is afloat, everything is okay. Such reasoning ignores that what helps people achieve their ends is not money per se but the actual producer and consumer goods that are produced throughout the social economy.

Alas, investment made possible by subsidized loans of newly created money contributes to an unproductive use of resources. Thus the economic problem with government-guaranteed student loans. Consider:

Read More at OfficialWire . By Dr. Shawn Ritenour.

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Obama’s “Fairness” Economy Has Backfired

May 6, 2013 By 1 Comment

Barack Obama speech 7 SC Obamas Fairness Economy Has Backfired

One of the most seductive parts of President Barack Obama’s political message (and the message of progressive Democrats in general) is sympathy for the poor and a willingness to talk about the disparities of capitalism — about the rich being too rich and the poor being screwed. In some ways, it’s the predominant message of the Obama era.

And though it’s reasonable to contend that Republicans need to display more compassion — if for nothing else than their own political survival — isn’t it also reasonable to take stock of how things have gone for the poor under four-plus years of progressive rule?

Now, if you’re heavily invested in the market, life is peachy. A confounding fact, no doubt, when one considers that nearly every economic indicator known to mankind has been pretty abysmal of late. We are experiencing high unemployment, a shrinking labor force, stagnant gross domestic product growth and rickety consumer confidence. A disconnected market, though, has been on a historic boom. So if we need any more proof that life really isn’t fair, think about this: The rich have the Federal Reserve, and you have Harry Reid.

What does it mean in substance? According to a new Pew Research Center analysis of Census Bureau data, thanks to a robust stock and bond market, coupled with a lousy housing market, the recovery has meant that households with a net worth in the upper 7 percent have seen their net worth rise, on average, by nearly 30 percent in the years after the recession and that everyone else’s net worth has dropped by an average of 4 percent.

The economic gap between whites and minorities is even worse. According to the Urban Institute, whites, on average, have two times the income of blacks and Hispanics and six times the wealth, and that gap is accelerating.

Read More at Reason . By David Harsanyi.

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The Federal Reserve Is Robbing You Blind

May 4, 2013 By 2 Comments

Ben Bernanke SC The Federal Reserve is Robbing You Blind

Last week, I began to explain what America might look like after a government collapse. I ended on a note about the Federal Reserve, and I promised I’d come back to it.

Well, here we are. And I’m going to begin with a radical statement:

The purpose of the Federal Reserve is to benefit its shareholders… not America.

This statement is confusing to most people because they assume the Federal Reserve is an agency of the government. It’s not.

In fact, it’s a private entity. Only the shareholders aren’t private investors. They’re the major “too-big-to-fail” banks of America.

The next thing you must understand is that the Fed was given (by Congress) the most lucrative monopoly on earth… total control over the creation of money. So it can print money, legally. What a business!

Now, don’t get me wrong – there is some regulation. What Congress gives, it can also take away.

The problem is that when you can literally create money, you have lots of cash to influence the system.

Indeed, when it comes to the economy, the Fed is even more powerful than the president. Only Congress and the president, working in unison, can check the power of the Federal Reserve.

And considering that such cooperation isn’t exactly the norm in D.C., the Fed is using its insane amount of power to rob you blind.

Here’s how…

Too Big to Fail

Simply put, the supply of money should only grow at about the same rate as the economy. It creates a solid equilibrium between goods in the economy and the money supply.

But when the supply of money grows too quickly, it shatters equilibrium and leads to inflation (i.e. – too many dollars chasing too few goods).

And right now, we have too many dollars.

Of course, we can thank the economic crisis in 2008 for that. As you know, when the banking crisis erupted, the Fed was fearful that its shareholders were going belly up. So the former CEO of Goldman Sachs (GS), Hank Paulson, arranged for billions of dollars to be transferred from the government to these private banks through the Troubled Asset Relief Program (TARP).

Keep in mind, I believe allowing banks to go bankrupt would’ve been the best solution for America. We have over 200 years of bankruptcy court precedent, and the courts should’ve overseen the liquidation of these mismanaged banks. It ultimately would have punished the guilty parties.

But that didn’t happen. Instead, the Federal Reserve kicked into action. It created over $1 trillion that was lent to these same banks to keep them from collapsing.

Now, with so much money floating around, bank deposit owners are worried that the supply of dollars will outstrip demand. This could drive the price of the dollar down. In fact, I believe we could even see a flash crash of the dollar.

And that’s precisely how the Fed is stealing from you. It’s knowingly devaluing the dollar, so your money can buy fewer goods.

And no one is safe.

Say you’re happily employed – perhaps you even got a raise recently. Unfortunately, inflation can devalue your dollars so fast that you end up with less buying power than you began with.

As long as the Fed continues on its current path, we’ll continue holding a currency that’s worth less and less every day.

How Can We Protect Ourselves?

We’ll all likely get poorer unless we have taken serious steps to hedge ourselves.

Buying gold, stocks, real estate, and other hard assets is the best hedge. When the dollar crash comes, these assets will likely bounce back from the inflation, even if their prices decline at first.

Bonds, CD’s, and cash are the assets I encourage everyone to avoid. They’ll be crushed by inflation.

Once again, this is just a small part in the ongoing quest to see what America will look like after a government collapse.

Along the way, I want to explain what’s happening behind the scenes in Washington and give you as much actionable advice as possible.

 

This article originally appeared at CapitolHillDaily.com and is reprinted here with permission. 

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Five Most Wanted Economic Villains

May 4, 2013 By 2 Comments

Obama Geithner Credit Downgrade Deal SC Five Most Wanted Economic Villains

Everyone knows that the American financial system has been through a rough few years. Record public deficits, high unemployment, stagnant economic growth, yada, yada, yada. No surprise there. Americans can’t decide exactly who is to blame: Republicans or Democrats? Let’s just split the difference; we’ve decided and have a Republican House and Democratic Senate and Presidency. Maybe when government is closely divided, they’ll end up doing less damage that way. Or maybe not. It seems like the closely divided Congress has done little to ease our economic woes. Both parties bear some of the blame. Who, though, are the individuals who bear the most guilt for what has transpired? Who are the five most wanted economic villains in the modern day USA?

The fifth most guilty individual is Nancy Pelosi, the former majority leader of the House and current minority leader. Why Ms. Pelosi? After all, Congressional scholar Norman Ornstein stated that the House presided over by Pelosi was “on a path to become one of the most productive since the Great Society.” Isn’t that a good thing? Halt. The word “productive” when applied to the free enterprise system and about everything else besides government equals a good thing. When the word is applied to government, it is often a bad thing. The Great Society, as you know, was a massive increase in the size of the federal government. Nancy Pelosi’s “productivity” threatens to have much of the same result: expansion, expansion, expansion. She helped expand the federal government by passing a massive and ineffective stimulus bill, boosted the minimum wage (I thought we wanted less unemployment), and passed Obamacare, an unpopular program that threatens to wreak financial havoc on an already-troubled country. Such are some of Pelosi’s worst deeds.

Hate to hit on a guy who’s out of office, but he deserves it. Mr. Timothy Geithner stood behind some of the worst shenanigans in modern American economic history. Geithner was both head of the New York Federal Reserve and then the Secretary of the Treasury during Obama’s first term. In both positions, he strongly advocated for more financial assistance for big banks, from the budget in the form of TARP and the Federal Reserve in the form of cheap loans. These are probably his worst acts. Other than that, he failed to arrest the economic decline of the country during his time as Treasury Secretary.

Paul Krugman comes next. Mr. Krugman is a Nobel Laureate, professor, and New York Times columnist. His personal motto seems to be “never enough government.” No matter how many billions of dollars in stimulus Barack Obama and the Congress applied to the economy, it was never enough for Dr. Krugman. Whatever happens, he is sure to reply that the problem is insufficient government. No matter that the consensus seems to have emerged around free market, neoclassical economics instead of Dr. Krugman’s Keynesianism. Despite the unrivaled success of the free market, expect him to continue espousing his noxious form of economic interventionism to his death bed.

Now for the man you knew would have to be on the list. President Barack Obama shares the same liberal philosophy as Dr. Krugman, professions of being a moderate aside. He promised hope and has only brought disillusionment to a generation in desperate need of hope. Exploding food stamp use, massive government spending, and even an increased racial divide in terms of wealth have occurred under Obama . According to a recent article in the New York Times, Blacks and Hispanics have suffered far more than whites during his Presidency in economic terms. Of course, there is also Obamacare, which threatens to complete the morphing of the U.S. from one of the best places for medical care on the planet to a laughingstock in the international community.

At the top of the list of economic bunglers comes Ben Bernanke. Dr. Bernanke has failed to fix the economy despite the unprecedented amounts of money he has poured into the economy through his various QE programs. For those of you behind on the lingo, QE programs essentially increase the money supply by using the various tools of the Federal Reserve to do so. If QE 1, QE 2, QE3, and QE4 have failed to work, don’t hold your breath expecting it to work in the future. The unemployment rate is still bad despite Bernanke’s QEs and Obama’s stimulus plans. Economic growth is anemic. One bright spot has been the bubble Bernanke has helped create in the US stock market. But this bubble will come to an end; and when it does, it won’t be pretty.

Thankfully, Americans aren’t stupid like the central planners like to think, and they will wake up at some point to the fruitless attempts Bernanke, Obama, and company have made to stimulate the economy. The only question is: will they do it soon enough, or will America have to reach a place so ugly that we won’t recognize the America of our youth? Let us hope and pray that someone out there will have the gumption to take on the economic failures of the establishment before it is too late.

 

F. Peter Brown is Editor at the Sound Money Institute and Associate Editor at the Western Center for Journalism. He tweets  @FPBLibertarian.

 

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Blueprint To Restore The Republic

March 25, 2013 By Leave a Comment

constitution Blueprint To Restore the Republic

Citizens need to work towards placing into office a majority of conservative libertarian committed citizens that will implement repeal of the 16th Amendment to the Constitution from an out of control federal government to end their tyranny. This amendment created the Income Tax. This would place the entire question of our runaway federal government into the hands of the several States where this issue belongs in the first place. This is possibly the only way we can rein in the ruinous spending and onerous taxes of an out of control federal government spending the nation into bankruptcy from recalcitrant policies of continual tax, borrow and spend.

We can take solace in the unity the States have shown to the Firearms Freedom Act, which has pointed the way to the start of a full-blown federal tax revolt to bring the matter forward in a civilized and dignified Constitutional manner. This would become the catalyst for sincere debate about the future of our nation based on our founding principles grounded upon the foundation of our Constitution, a win-win proposition. With the added bonus that the President has no say whatsoever in the matter, it is beyond his Constitutional purview with the right of amendment being granted solely to the States which originally ceded a portion of their sovereignty to create the federal government. They are the parties that define what the Constitution is, and more importantly what it is not…will they exercise their power to define the federal government once again in our hour of need?

After all we are a confederation and compact of sovereign States that have formed a union having the federal governments taxing power brought into focus and placed as a constitutional amendment once again before the “People’ would short-circuit the power of the federal government and immediately bring them to heel.

As much as it frightens me to say this, in the alternative a Constitutional Convention could be convened that would implement this repeal. We are only two states away from this solution as 32 States had called for a convention along similar grounds in 2008, so this plan has merit and the time may be ripe for implementation.

Congress cannot spend what Congress does not have, they must also implement a balanced budget requirement as well, another requirement must be to eliminate borrowing and destruction of the Federal Reserve as a central bank to return this nation to a Gold based currency to restore solvency. These steps must be taken if we are to return to fiscal responsibility and break the hold of identity politics that have gripped this nation since the 1930′s, first with Roosevelt and radically expanded during the Johnson administration with the creation of the Welfare State and the entitlement mentality.

The latest monumental legislative overreach Obama Care was foisted upon the nation from a Democrat controlled Congress without one Republican vote. It was affirmed by the Supreme Court, which literally did back flips to approve this legislative nightmare, forcing all citizens to engage in commerce of the Democrats choosing. This legislation screams from the rooftops that our system is unduly broken and in need of repair if we are to keep our Constitutional Republic.

On the other hand, if we continue to go down the rabbit hole of Socialism we will never be seen as a “Free and Able People” again, and what is literally at stake if we do not turn away from this course.

With the repeal of the 16th amendment, our entire federal bureaucracy is hobbled and Washington’s overreach is immediately eliminated and governmental power would revert to the States and the People. It would also have the added benefit of breaking the disgraceful hold of the Left and the Democrats propensity to create divisive electorate groups based on anger, envy, sex, income, race, creed, religion, national origin, sexual orientation and eliminate the class warfare that they set against the nation and its unsuspecting people.

Ultimately, it would destroy their ability to re-distribute the nations treasure and our citizen’s personal incomes, wages and labors as they see fit regardless of the destructive consequences they create and has become evident by the moribund economy and loss of economic opportunity.

After all our current troubles are because of the Democrats efforts to create the current entitlement culture and economy, much less expand it, even after its toxic effects have become evident. The elimination of the 16th Amendment would simply obliterate the Left and there destructive politics based on other people’s incomes and there abhorrent identity politics on which the Democrats continually pander.

The Democrats and their leftist supporters would be forced to show the ugly face behind the mask and reveal how subversive they really are to the American people. As they would object to the proposed Amendment and their power base of unions, so-called poor, minorities, government workers, teachers etc., would come out in full-force in massive protests. It would literally pull the rug out from under them and lead to the current destruction of their dynasty for all eternity.

I say good riddance…

Another amendment that must be repealed along with the 16th is the 17th Amendment to replace the balance of power between the Federal Government and States interests as the Constitution originally intended!

If you want Peace you must prepare for War…Obama’s government is preparing for war against its own people.

Can we ignore the warnings…or will we just fail to act?

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