New Dawn Fades

Gotham and the Death of the West

By Mark Hackard

“It’s just a movie”, we so often hear in response to any criticism of a film’s suggestive power over the mass psyche. Thus propaganda emanating from Hollywood is made to appear a harmless diversion rather than the agent of social control and transformation it actually is. When a black-clad killer stormed the theater premiere of The Dark Knight Rises in Aurora, Colorado on July 20^th and proceeded to rake the audience with gunfire, the exact same scenario was transpiring on-screen before them in a preview of the upcoming picture Gangster Squad. For victims of the massacre and the American public at large, reality and fantasy have been fused in an alchemical wedding; it is in this realm that phantasms and flickering simulacra deceive men and lure them to destruction. Here, too, death is master. [1]

As the final installment of the Batman trilogy, The Dark Knight Rises is more than a movie, just as its hero Bruce Wayne sought to overcome limits imposed upon mere mortals. Director Christopher Nolan has crafted a film of grand and sinister sweep, though his cinematography provides only the backdrop to an explicit and inescapable theme: the ruin of the West, its reduction to ashes. Even standard liberal convention, special effects and pulverizing violence in the screenplay cannot conceal the apocalyptic vision that unfolds before us.

How A Country Rationally Exits The Eurozone

We are about to experience the Euro Exit Scenario

By Gonzalo Lira

Mish Shedlock and I have a private bet as to whether Italy or Spain will exit first—he says Italy, I say Spain. But either way, it’s gonna pretty much suck. 

The whole point of exiting the eurozone is because a country no longer has the money to finance its continuing operations. Insofar as Spain, Greece and possibly Italy, that moment will arrive shortly—possibly within days in the case of Spain. So if a sovereign government reaches this moment, it will have no choice but to exit the EMU and revert to a local currency which the government can then devalue. 

By doing this, the government simultaneously has all the cash it needs to continue operations, and also inflates away its debts. The private sector gets a shot of adrenaline insofar as foreign trade is concerned, because its goods and services become that much cheaper on the foreign markets. And the employment situation gets a boost, as those producers selling their cheap goods and services overseas begin to hire more workers to fulfill demand. 

Apocalypse Not

A history of failed predictions of doom

By Matt Ridley

"Who or what will cause the 2012 apocalypse?" This is the question posed by the website 2012apocalypse.net. "Super volcanos? Pestilence and disease? Asteroids? Comets? Antichrist? Global warming? Nuclear war?" the site's authors are impressively open-minded about the cause of the catastrophe that is coming at 11:11 pm on December 21 this year. But they have no doubt it will happen. After all, not only does the Mayan Long Count calendar end that day, but "the sun will be aligned with the center of the Milky Way for the first time in about 26,000 years."

Case closed: Sell your possessions and live for today.

When the sun rises on December 22, as it surely will, do not expect apologies or even a rethink. No matter how often apocalyptic predictions fail to come true, another one soon arrives. And the prophets of apocalypse always draw a following-from the 100,000 Millerites who took to the hills in 1843, awaiting the end of the world, to the thousands who believed in Harold Camping, the Christian radio broadcaster who forecast the final rapture in both 1994 and 2011.

China's Growth: Planning or Private Enterprise?

China is, in fact, two separate economies: the private and the state

By Paul Gregory

Introduction

China appears to have come through the world economic crisis better than many other countries. China's admirers claim that, under China's "state capitalism," planners have guided large state companies rationally and wisely through the rough seas of the world economy. The Chinese Communist Party (CPC) plans, oversees, and administers the interwoven network of state banks, airlines, railroads, utilities, oil companies, and large manufacturers, all of which make up the economy's "commanding heights" (to use Lenin's term). As Europe and the United States slump, the CPC can speedily launch infrastructure projects or shift millions of migrant workers from one locality to another. There is no messy democracy to gum up the works. New York Times columnist Thomas Friedman extols: "A one party system can just impose the politically difficult but critically important policies needed to move a society forward in the 21st century."1

But Ludwig von Mises in the 1920s and F. A. Hayek in the 1930s discredited the idea that planners can manage an entire economy. Hayek pointed out that central planners lack "the knowledge of the particular circumstances of time and place."2 Because the planners do not have the information that rests with hundreds of thousands of companies and millions of consumers, planning fails, as it did spectacularly in the Soviet Union. Interestingly, even socialist economist Robert Heilbroner admitted as much.3 China is not an exception. Its economic growth has occurred despite the government's economic planning and because of its large, dynamic private sector.

Organized Crime

The Unvarnished Truth About Government

by David Gordon

Thomas DiLorenzo is probably best known to the public for his revisionist studies of Lincoln, but he has a wide range of economic and historical interests.[1] Organized Crime, a collection of 52 short articles by him, shows again and again his keen eye for the striking historical detail that exactly illustrates the point he wants to make.

It will come as no surprise that price controls do not work. But DiLorenzo still manages to come up with an unexpected point about this familiar topic. The Nazi leader Hermann Goering warned the American occupation authorities that they stood in danger of repeating the mistakes of his own recently fallen regime. Speaking to the American correspondent (and, by the way, later American Ambassador to Switzerland) Henry Taylor, Goering said,

Your America is doing many things in the economic field which we found out caused us so much trouble. You are trying to control peoples' wages and prices — peoples' work. If you do that you must control peoples' lives. And no country can do that part way. I tried and it failed. Nor can any country do it all the way either. I tried that too and it failed. You are no better planners than we. I should think your economists would read what happened here. (p. 5)

The Fallacy of Territorial Extension

This confederated state of ours was never planned for indefinite expansion or for an imperial policy

By WILLIAM GRAHAM SUMNER, 1896

The traditional belief is that a state aggrandizes itself by territorial extension, so that winning new land is gaining in wealth and prosperity, just as an individual would gain if he increased his land possessions. It is undoubtedly true that a state may be so small in territory and population that it cannot serve the true purposes of a state for its citizens, especially in international relations with neighboring states which control a large aggregate of men and capital. There is, therefore, under given circumstances, a size of territory and population which is at the maximum of advantage for the civil unit. The unification of Germany and Italy was apparently advantageous for the people affected. In the nineteenth century there has been a tendency to create national states, and nationality has been advocated as the true basis of state unity.

The cases show, however, that the national unit does not necessarily coincide with the most advantageous state unit, and that the principle of nationality cannot override the historical accidents which have made the states. Sweden and Norway, possessing unity, threaten to separate. Austro-Hungary, a conglomerate of nationalities largely hostile to each other, will probably be held together by political necessity. The question of expedient size will always be one for the judgment and good sense of statesmen.

The Gathering Storm

Real choices must now be made and real consequences will leap like Cerberus from those choices

“In old days there were angels who came and took men by the hand and led them away from the city of destruction. We see no white-winged angels now.”

                                       -George Elliot, Silas Marner
By Mark J. Grant

In the raging battle taking place in Europe between the haves and the have nots, the North and the South, those with money and those that are begging for it; there are moments when the calm sets in before the lightning strikes and the thunder booms. The silence is almost eerie and the air resonates with a certain kind of vibrant electricity that is somewhat reminiscent of Dickens and his Great Expectations which is what really seems to be driving the markets these days.

“Take nothing on its looks; take everything on evidence. There's no better rule.”

                                  -Charles Dickens, Great Expectations

You didn’t screw it on your own

You can thank the bureaucratic tyrants of the nanny state

By B. Obama

Look, if you’ve been unsuccessful, you didn’t get there on your own. If you were unsuccessful at opening or operating a small business, some government official along the line probably contributed to your failure.  There was an overzealous civil servant somewhere who might have stood in your way with unreasonable regulations that are part of our American system of anti-business red tape that allowed you to not thrive.  Taxpayers invested in roads and bridges, but you might have faced city council members who wouldn’t allow you to use them.  If you’ve been forced to close a business – it’s often the case that you didn’t do that on your own.  Somebody else made that business closing happen or prevented it from opening in the first place. 

You can thank the bureaucratic tyrants of the nanny state

The myth of a post-Apartheid ‘rainbow nation’

Massacre of the miners: the ANC’s Sharpeville

Why is there reluctance to discuss the killing of 34 miners in South Africa? 

by Brendan O’Neill 

Around the world, there’s a palpable queasiness about discussing the South African police’s massacre of 34 striking miners at the Lonmin platinum mine in Marikana.

In Western newspapers, thundering editorials have been notable by their absence. No world leaders have issued withering condemnations of the government in South Africa, as they would have done in a flash if something like this had happened in Russia or China. Amnesty made a half-hearted statement (‘a judge must oversee an investigation into the deaths’) and then went back to organising global protests for the release of Pussy Riot. Even in South Africa itself, there is reluctance to talk frankly about the killings. In the words of one SA observer, ‘The most striking thing about the reaction is the lack of it’. Many people refer to the massacre as a ‘tragedy’, as if it were an accident at a mine rather than an act of state terror at a mine, or simply as an ‘incident’, that catch-all word that can cover everything from a scuffle on a bus to, it seems, the killing in three minutes flat of 34 people.

Why the caginess about discussing this major event? It is because the massacre did not only kill 34 miners – it also killed, or rather threatens to kill, the myth of a post-Apartheid ‘rainbow nation’. The massacre throws into sharp relief the nature of post-Apartheid South Africa and the bald, uncomfortable fact that while it may have done away with the overt racism of the old regime, it has kept in place the economic system that the old regime nurtured and the extreme exploitation of black workers that it was underwritten by. Having held up the so-called ‘rainbow nation’ of post-Apartheid South Africa as a shining example of how only negotiated political settlements can bring peace and only multiculturalism can ensure justice, observers around the world are made supremely uncomfortable by these recent events.

New World Disorder

The world's new powers discover the old ethnonationalisms

By Patrick J. Buchanan 

After his great victory in Desert Storm, George H.W. Bush went before the United Nations to declare the coming of a New World Order. The Cold War was yesterday. Communism was in its death throes. The Soviet Empire had crumbled.

The Soviet Union was disintegrating. Francis Fukuyama was writing of The End of History. Savants trilled about the inevitable triumph of democratic capitalism.

Yet, in 2012, sectarianism, tribalism and nationalism are all resurgent, reshaping a world where U.S. power and influence are visibly receding.

Syria is sinking into a war of all against all that may end with a breakup of the nation along ethno-sectarian lines–Arab, Druze, Kurd, Sunni, Shia and Christian. Iraq descends along the same path.

A U.S. war with Iran could end with a Kurdish enclave in Iran’s northwest tied to Iraqi Kurdistan, Iran’s Azeri north drifting toward Azerbaijan, and a Balochi enclave in the south linked to Pakistan’s largest province, Balochistan, leaving Iran only Persia.

The Middle and Near East seem to be descending into a Muslim Thirty Years’ War of Sunni vs. Shia. Out of it may come new nations whose names and borders were not written in drawing rooms by 19th- and 20th-century European cartographers, but in blood.

Freedom is seldom lost all at once

"Issues" or America?

By Thomas Sowell 

There are some very serious issues at stake in this year's election -- so many that some people may not be able to see the forest for the trees. Individual issues are the trees, but the forest is the future of America as we have known it.

The America that has flourished for more than two centuries is being quietly but steadily dismantled by the Obama administration, during the process of dealing with particular issues.

For example, the merits or demerits of President Obama's recent executive order, suspending legal liability for young people who are here illegally, presumably as a result of being brought here as children by their parents, can be debated pro and con. But such a debate overlooks the much more fundamental undermining of the whole American system of Constitutional government.

The separation of powers into legislative, executive and judicial branches of government is at the heart of the Constitution of the United States -- and the Constitution is at the heart of freedom for Americans.

No President of the United States is authorized to repeal parts of legislation passed by Congress. He may veto the whole legislation, but then Congress can override his veto if they have enough votes. Nevertheless, every President takes an oath to faithfully execute the laws that have been passed and sustained -- not just the ones he happens to agree with.

Unlike Obama, Ryan has a plan

Obama’s Gotta Go

by Niall Ferguson  

I was a good loser four years ago. “In the grand scheme of history,” I wrote the day after Barack Obama’s election as president, “four decades is not an especially long time. Yet in that brief period America has gone from the assassination of Martin Luther King Jr. to the apotheosis of Barack Obama. You would not be human if you failed to acknowledge this as a cause for great rejoicing.”

Despite having been—full disclosure—an adviser to John McCain, I acknowledged his opponent’s remarkable qualities: his soaring oratory, his cool, hard-to-ruffle temperament, and his near faultless campaign organization.

Yet the question confronting the country nearly four years later is not who was the better candidate four years ago. It is whether the winner has delivered on his promises. And the sad truth is that he has not.

In his inaugural address, Obama promised “not only to create new jobs, but to lay a new foundation for growth.” He promised to “build the roads and bridges, the electric grids, and digital lines that feed our commerce and bind us together.” He promised to “restore science to its rightful place and wield technology’s wonders to raise health care’s quality and lower its cost.” And he promised to “transform our schools and colleges and universities to meet the demands of a new age.” Unfortunately the president’s scorecard on every single one of those bold pledges is pitiful.

The Sovietization of the West

Are People Being Thrown In Psychiatric Wards For Their Political Views?

by George Washington

Many psychologists and psychiatrists are good people, who are only trying to help their patients.

But the Nazi government substantially supported psychologists … many of whom, in turn, espoused extermination of the people they considered to be “racially and cognitively compromised”.

Soviet psychiatrists famously aided Stalin in applying fake insanity diagnoses to political dissenters.

American psychologists created the American program of torture which was specially-crafted to produce false confessions to justify U.S. military policy. And see this.

And authoritarian American psychologists are eager to label anyone “taking a cynical stance toward politics, mistrusting authority, endorsing democratic practices, … and displaying an inquisitive, imaginative outlook” as worthy of a trip to the insane asylum. (Those traits may also get one labeled as a potential terrorist.)

Why a collapse of the Eurozone must be avoided

The main concern should be whether small, wealthy northern countries want to abandon the Eurozone

By Anders Åslund

It has become increasingly fashionable to talk about Europe without the euro. But this column points out that in the last century Europe has seen the collapse of three multi-nation currency zones: the Habsburg Empire, the Soviet Union, and Yugoslavia – and they all ended with disastrous hyperinflation. The lesson for the Eurozone is clear: avoid break up at almost any cost.

Articles on a possible breakup of Eurozone either see it as a mere devaluation (Lachman 2010, Roubini 2011) or reckon that its collapse would amount to a major economic disaster (Buiter 2011, Cliffe et al. 2010, Normand and Sandilya 2011). It seems the latter is more likely. Large imbalances have accumulated between southern debtor countries and northern creditor countries. Any capping of these balances would disrupt the payments mechanism between the Eurozone countries and impede all economic activity (Åslund 2012).

In the last century, Europe saw the collapse of three multi-nation currency zones, the Habsburg Empire, the Soviet Union, and Yugoslavia. They all ended in major disasters with hyperinflation. In the Habsburg Empire, Austria and Hungary faced hyperinflation. Yugoslavia experienced hyperinflation twice. In the former Soviet Union, ten out of 15 republics had hyperinflation (e.g. Pasvolsky 1928, Dornbusch 1992, Pleskovic and Sachs 1994, and Åslund 1995).

Egypt thumbs the nose at US

No return to Mubarak era

By M K Bhadrakumar

The gloom in Washington must be deepening. Egypt is careering away from the alliance with the United States - and the bitter truth cannot be hidden or obfuscated anymore.

This is not how Washington expected the "right side of history" to play out. The Arab Spring has borne a strange fruit in Egypt - a pure breed, unlike the hybrids in Tunisia, Libya or Yemen.

Consider the following. President Barack Obama was one of the first statesmen to greet Mohammed Morsi on his election victory in May. Obama broke protocol and phoned to congratulate him, signifying the anxiety in Washington to have a splendid chemistry with him.

Disaster in Iraq, disaster at home

If a few well-connected contractors profit along the way, more power to them

By Peter Van Buren

Some images remain like scars on my memory. One of the last things I saw in Iraq, where I spent a year with the Department of State helping squander some of the US$44 billion American taxpayers put up to "reconstruct" that country, were horses living semi-wild among the muck and garbage of Baghdad.

Those horses had once raced for Iraqi autocrat Saddam Hussein, and seven years after their "liberation" by the American invasion of 2003 they were still wandering that unraveling, unreconstructed urban landscape looking, like many other Iraqis, for food.

I flew home that same day, a too-rapid change of worlds, to a country in which the schools of my hometown in Ohio could not  afford to pay teachers a decent wage. Once-great cities were rotting away as certainly as if they were in Iraq, where those horses were scrabbling to get by. To this day I'm left pondering these questions: Why has the United States spent so much money and time so disastrously trying to rebuild occupied nations abroad, while allowing its own infrastructure to crumble untended? Why do we even think of that as "policy"?

The good war(s)

With the success of the post-World War II Marshall Plan in Europe and the economic miracle in Japan, rebuilding other countries gained a certain imperial patina. Both took relatively little money and time. The reconstruction of Germany and Japan cost only $32 billion and $17 billion, respectively (in 2010 dollars), in large part because both had been highly educated, industrialized powerhouses before their wartime destruction.

The euro break up

What future currency unions might emerge from the wreckage ? 

By Martin Hutchinson 

When even the strongly europhile Economist (August 11-17, pp 19-22) publishes a lengthy piece on how the euro might break up, the question must be worth addressing again. For one thing, we should think about how many pieces the euro Humpty Dumpty egg might form when it hits the ground, and what future currency unions might emerge from the wreckage. 

The question of costs and benefits in a break-up, which The Economist addressed in detail but not necessarily accurately, is another that's well worth consideration. 

The Economist begins by asserting that a Greek exit from the euro is more or less inevitable, absent gigantic subsidies. Here I Agree; it is not just inevitable, but two years overdue. Had Greece been shoved out of the euro in March 2010, when it first came begging for handouts, announcing that its national accounts had been fraudulent for a decade, the effect on other misbehaving Mediterraneans would have been highly salutary. 

The Economist also overstates the bill for Greece's exit, putting it at 320 billion euros, about US$380 billion. First it assumes the European Union would need to give Greece yet another 50 billion euros to tide it over on its exit - an absurd assumption, throwing good money after bad (though as Greece would remain a member of the EU and its gross domestic product per capita would be sharply reduced, no doubt it would gain some of the slush-funds for poorer members that prop up the likes of Bulgaria and Romania). 

"Too Small To Matter" Greece Once Again Requests More Money

We may end up with a euro zone that is perpetually on the brink

By now it should be painfully clear to involved that the Greek economy is nothing but a zombie, whose funding shortfalls and other deficit needs are sustained each month only courtesy of constantly new and improved "financial engineering" ponzi creations out of the ECB, the ELA, and other interlinked funding mechanisms which are merely a transfer of German cash into empty peripheral coffers. And while the attention of the world has moved on, at least for the time being, from the small country which has been left for dead with the assumption that Europe will do the bare minimum to keep it alive, but not more, Greece once again reminds us that not only does it still pretend to be alive, but that the zombie is getting hungry, and want to eat.

The latest news out of Athens is that ahead of the Samaras’ meeting with Juncker tomorrow and Merkel on Friday, the Troika is said to have found that Greece’s funding shortfall could be as high as EUR14bn, or 20% more than previously "agreed upon."

The Panic Over Fukushima

The reactor at Fukushima wasn't designed to withstand a 9.0 earthquake or a 50-foot tsunami

Japan's nuclear accident was a great human tragedy, but its long-term health effects have been exaggerated—and the virtues of nuclear power remain.

By RICHARD MULLER

Denver has particularly high natural radioactivity. It comes primarily from radioactive radon gas, emitted from tiny concentrations of uranium found in local granite. If you live there, you get, on average, an extra dose of .3 rem of radiation per year (on top of the .62 rem that the average American absorbs annually from various sources). A rem is the unit of measure used to gauge radiation damage to human tissue.

The International Commission on Radiological Protection recommends evacuation of a locality whenever the excess radiation dose exceeds .1 rem per year. But that's one-third of what I call the "Denver dose." Applied strictly, the ICRP standard would seem to require the immediate evacuation of Denver.

It is worth noting that, despite its high radiation levels, Denver generally has a lower cancer rate than the rest of the United States. Some scientists interpret this as evidence that low levels of radiation induce cancer resistance; I think it is more likely that lifestyle differences account for the disparity.

When the Weakest Critical Part Fails, the Machine Breaks Down

The assets are still phantom, the collateral nonexistent, the guarantees empty and the power illusory

Consumer spending is the bedrock of the global economy, and consumer spending depends on expanding debt and leverage. Once that subsystem fails, consumerism and the global economy grind to a halt.

by Charles Hugh Smith

The failure of any critical subsystem in an organism triggers a catastrophic, fatal decline. It doesn't matter if the rest of the critical subsystems are functioning at optimum levels; the failure of even one essential "part" leads to death.

The metaphor is easily extended to machines, where a perfectly sound engine will fail once the oil pump ceases functioning.

The cliche is that a chain is only as strong as its weakest link. The conventional wisdom is that the U.S. economy is so large and diverse that the failure of any one part will have only limited consequences on the economy as a whole.

But this belief was undermined by the financial crisis of 2008, in which the apparently "limited" implosion of subprime mortgage debt dominoed into a full-blown global financial crisis.

Conventional wisdom confuses redundancy and complexity. The implicit foundation of the conventional view (that the U.S. economy is so large and diverse that the failure of any one subsystem will have limited negative effects) is a belief that the system's complexity offers intrinsic redundancy: that is, if one part of the economy underperforms or even vanishes, it will quickly be replaced by the expansion or emergence of some other part.

Empire Games

Reading Gibbon with an eye on the Olympics

BY THEODORE DALRYMPLE

As London prepared for the Olympics, the most that my friends there hoped was that they would not suffer inconvenience, at least not beyond the increased taxation that will no doubt soon be exacted in order to pay for the games. The worst report I have heard so far about the games’ impact on daily life is of the severe overcrowding at the Underground station at Earls Court, frantically busy at the best of times. But in the matter of the games, Gibbon’s Decline and Fall has some lessons. Writing of the Emperor Philip, “the minister of a violent government, elected for the private benefit of the soldiers,” he observes: “On his return from the East to Rome, Philip, desirous of obliterating the memory of his crimes, and of captivating the affections of the people, solemnized the secular games with infinite pomp and magnificence.”

History does not repeat itself except by analogy—and here, it is hard not to see an analogy between Philip and former prime minister Anthony Blair. Of course, we live, as Gibbon might have put it, in a politer age, when crimes have to be muted, untruths disguised by rhetoric, and the ruination of states performed by stealth rather than by personal extravagance and outright defalcation. Still, Blair’s regime benefited only those who worked for it, and the Olympics, for which he lobbied hard, were his parting gift to the nation he had betrayed, a fitting memorial to a man with a soul of tinsel. In this connection, one cannot help but note Gibbon’s account of the Emperor Caracalla’s legacy: “The prodigality of Caracalla had left behind it a long train of ruin and disorder; and if that worthless tyrant had been capable of reflecting on the sure consequences of his own conduct, he would perhaps have enjoyed the dark prospect of the distress and calamities which he bequeathed to his successors.” Caracalla, of course, was killed; ours being an altogether gentler age, Blair is thinking of making a comeback.

Shhhh…It’s Even Worse Than The Great Depression

The path we’re on ends with mountains of corpses when the great experiment fails

by Mark McHugh

According to Wikipedia, Narcissistic personality disorder (NPD) affects one percent of the population and has little to do with looking at yourself in the mirror.  It has a lot to do with unrealistic fantasies of success, power and intelligence.   Some NPD sufferers become cult leaders or mass murderers, the rest become  economists and policy-makers.   Despite having a highly elevated sense of self-worth, narcissists have fragile self-esteem and handle criticism unpredictably, so let’s keep this to ourselves….

Velocity of money is the frequency with which a unit of money is spent on new goods and services.   It is a far better indicator of economic activity than GDP, consumer prices, the stock market, or sales of men’s underwear (which Greenspan was fond of ogling).  In a healthy economy, the same dollar is collected as payment and subsequently spent many times over.  In a depression, the velocity of money goes catatonic.  Velocity of money is calculated by simply dividing GDP by a given money supply.  This VoM chart using monetary base  should end any discussion of what ”this” is and whether or not anybody should be using the word “recovery” with a straight face:

Turning the Games into a political podium

Another kind of Britain

by Brendan O’Neill 

While the likes of Blake, Bolt and Farah thrilled global audiences by going for gold at London 2012, Britain’s less fit opinion-forming classes were pursuing a less glorious goal: the use of the Olympics as a podium from which to crow about their victory in the Culture Wars.

From the flurry of fanboy commentary that followed Danny Boyle’s am-dram opening ceremony to the insistence that the Games represented the coming to fruition of the post-Diana dream of a new, less stuffy Britain, the urge to politicise the Games has been intense. That the political classes have sought so shamelessly to usher in ‘another kind of Britain’ on the back of the Games speaks volumes about their desperate need for a new national narrative, and their disillusionment with the democratic route to social overhaul.

Kill Private Capital, Kill Civilization

The Haitian state strikes only when there is something to loot

by Jeffrey Tucker Capitalism and entrepreneurship make the difference in the world. Whether a country is rich or poor depends on both. The evidence is all around us, and the explanations are a click away. An example is the video above. Anthony Bourdain is a fascinating person, a great chef and also world traveller. He has his own show called “No Reservations,” and one of my favorite episodes is the one he did on Haiti. He draws attention to some remarkable realities of the poverty in this country. It does not result from lack of imagination, from lack of trade, from lack of work. The problem is more fundamental. A Travel Channel episode of No Reservations, a cooking-focused show narrated by Anthony Bourdain, took viewers to Port-au-Prince, Haiti. I had heard that the show offered unique insight into the country and its troubles. I couldn't imagine how. But it turns out to be true. Through the lens of food, we can gain an insight into culture, and from culture to economy, and from economy to politics and finally to what's wrong in this country and what can be done about it. Through this micro lens, we gain more insight than we would have if the program were entirely focused on economic issues. Such an episode on economics would have featured dull interviews with treasury officials and IMF experts and lots of talk about trade balances and other macroeconomic aggregates that miss the point entirely.

America's Demographic Cliff

The Real Issue In The Coming, And All Future Presidential Elections

By Tyler Durden

In four months the debate over America's Fiscal cliff will come to a crescendo, and if Goldman is correct (and in this case it likely is), it will probably be resolved in some sort of compromise, but not before the market swoons in a replica of the August 2011 pre- and post-debt ceiling fiasco: after all politicians only act when they (and their more influential, read richer, voters and lobbyists) see one or two 0's in their 401(k)s get chopped off. But while the Fiscal cliff is unlikely to be a key point of contention far past December, another cliff is only starting to be appreciated, let alone priced in: America's Demographic cliff, which in a decade or two will put Japan's ongoing demographic crunch to shame, and with barely 2 US workers for every retired person in 2035, we can see why both presidential candidates are doing their darnedest to skirt around the key issue that is at stake not only now, be every day hence.

Sadly, the market which due to central-planner meddling, has long lost its discounting capabilities, and is now merely a reactive mechanism, will ignore this biggest threat to the US financial system until it is far too late. After all it is the unsustainability of America's $100+ trillion in underfunded welfare liabilities that is the biggest danger to preserving the American way of life, and will be the sticking point in the presidential election in 80 days. However, don't expect either candidate to have a resolution to the demographic catastrophe into which America is headed for one simple reason. There is none.