Living Europe’s Nightmare

Just because something is “unthinkable” doesn’t mean that it can’t happen

By Christopher T. Mahoney

Losing a long war is always hard to accept. Hemmed in by the Americans and the Russians in the final days of World War II, Hitler convinced himself that he had two armies in reserve to mount a counter-attack and win the war. Meanwhile, having lost the entire Pacific, Japan’s Imperial Cabinet believed that no enemy could set foot upon the country’s sacred soil. When the truth is unimaginable, human psychology finds an alternative reality in which to dwell.

That describes the global situation today. The entire planet seems to be in denial about what is about to occur in the eurozone. Pundits keep expecting Germany to pull a rabbit out of the hat and flood the continent with Eurobonds, or that Mario Draghi will mount a coup at the European Central Bank and buy up every deadbeat country’s bonds.

The IMF has just been made obsolete

Ireland wants rescue deal negotiated to match Spain's

A shopper looks at t-shirts at Liptons shop were the old Irish currency, the punt, is accepted in Clones, Ireland on May 30. Ireland wants to renegotiate its rescue plan to benefit from the same treatment as Spain, which looks set to win a bailout for its banks without any broader economic reforms in return, European sources said.

By Victor Clay

Ireland wants to renegotiate its rescue plan to benefit from the same treatment as Spain, which looks set to win a bailout for its banks without any broader economic reforms in return, European sources said on Saturday.

"Ireland raised two issues: one is the need to ensure parity of the deal with Spain retroactively on its bailout from EFSF," one European government source told AFP, referring to the temporary rescue fund, the European Financial Stability Facility.

The Phony Science of the Sexual Revolution

Kinsey’s Secret

by Sue Ellin Browder

It’s now more than 50 years since the revolution began. Sexual “liberation” has been endlessly ballyhooed by the national media, promoted in the movies, embraced by Playboy guys and Cosmo girls as a freedom more delicious than Eden’s apple. No American under 40 can honestly remember a time when sex on TV was taboo, when “living together” meant married, when “gay” meant happy, and when almost every child lived with both parents.

If truth be told, the revolution has been a disaster. Before the push to loosen America’s sexual mores really got under way in the 1950s, the only widely reported sexually transmitted diseases in the United States were gonorrhea and syphilis. Today we have more than two dozen varieties, from pelvic inflammatory disease (which renders more than 100,000 American women infertile each year) to AIDS (which presently infects 42 million people worldwide and has already killed another 23 million).

The fallen tiles are heading directly towards Rome

The Cross Of Forbearance

by Mark Grant

"What giants?" asked Sancho Panza.

"The ones you can see over there," answered his master, "with the huge arms, some of which are very nearly two leagues long."

"Now look, your grace," said Sancho, "what you see over there aren't giants, but windmills, and what seems to be arms are just their sails, that go around in the wind and turn the millstone."

"Obviously," replied Don Quixote, "you don't know much about adventures.”

                                                           -Miguel Cervantes

The wind picked up across the plains, the windmill began to turn and “The Ingenious Gentleman Don Quixote of La Mancha” rode out once more to do battle. The ever faithful Sancho Panza, not wishing to be left behind, was in attendance and the windmills were now the banks and the regional debt of the country.

Rand Paul just got on the steamroller

Rand Paul endorsed a man who is deeply hostile to human liberty

by John Aziz

Perhaps that’s Rand’s idea of playing politics? Come to the table, strike a deal, get what you can. Trouble is, it’s tough striking a good deal when the guy on the other side of the table believes that the government should be allowed to claim — without having to produce any evidence whatsoever — that certain people are terrorists, and therefore should be detained indefinitely without any kind of due process.

That’s textbook tyranny.

Time to move on beyond politics.

Lew Rockwell on Rand Paul's Endorsement of Mitt Romney

The Ron Paul campaign is over. Ron Paul has touched the minds of millions. 

The Republic Wears Prada

Obama redefines 'Green Zone'

By Mark Steyn

Queen Elizabeth II celebrated her Diamond Jubilee a few days ago – that's 60 years on the throne. Just to put it in perspective, she's been queen since Harry S. Truman was president. At any rate, her jubilee has been a huge success, save for a few churlish republicans in various corners of Her Majesty's realms from London to Toronto to Sydney pointing out how absurd it is for grown citizens to be fawning over a distant head of state who lives in a fabulous, glittering cocoon entirely disconnected from ordinary life.

Which brings us to President Obama.

Who is ruling and who is ruled

James Mill and Libertarian Class Analysis

by Murray N. Rothbard

The theory of class conflict as a key to political history did not begin with Karl Marx. It began, as we shall see further below, with two leading French libertarians inspired by J.B. Say, Charles Comte (Say's son-in-law), and Charles Dunoyer, in the 1810s after the restoration of the Bourbon monarchy. In contrast to the later Marxist degeneration of class theory, the Comte-Dunoyer view held the inherent class struggle to focus on which classes managed to gain control of the state apparatus. 

The ruling class is whichever group has managed to seize state power; the ruled are those groups who are taxed and regulated by those in command. Class interest, then, is defined as a group's relation to the state. State rule, with its taxation and exercise of power, controls, and conferring of subsidies and privileges, is the instrument that creates conflicts between the rulers and the ruled. What we have, then, is a "two-class" theory of class conflict, based on whether a group rules or is ruled by the state. On the free market, on the other hand, there is no class conflict, but a harmony of interest between all individuals in society cooperating in and through production and exchange.

Booming Sweden’s Free-Market Solution

The northern Europeans have little tolerance for the statist conservatism of Southern Europe

By Anders Aslund

Not so long ago, Sweden could claim world leadership in unmitigated Keynesian economics, with a 90 percent marginal tax rate and a welfare state second to none.

Now Swedes look at the conflict between the U.S. and German examples over whether more spending or more austerity is the key to financial salvation, and for them the choice is easy: Germany was right. Northern Europe harbors no sympathy for the spendthrifts of Southern Europe.

Americans still think of Sweden as a tightly regulated social-welfare state, but in the last two decades the country has been reformed. Public spending has fallen by no less than one-fifth of gross domestic product, taxes have dropped and markets have opened up.

Who Lost Greece?

Taking a Spring Break

A relatively insignificant southern European country threatens the very survival of the euro in its present form. How did we get here, and what lessons does Greece hold for the rest of the European periphery?

By Desmond Lachman

With Greece now literally in a state of economic and political collapse, and with the country on the cusp of an official debt default and an exit from the euro, it is not too early to pose some uncomfortable questions. Who lost Greece? How did we get to a situation in which a relatively insignificant southern European country threatens the very survival of the euro in its present form? And what lessons does Greece hold for the rest of the European periphery?

Japan is driving towards a brick wall

Can Japan No Longer Afford Ambitious CO2 Cuts?

By By Mari Iwata

The Japanese government, busy trying to win parliamentary approval for its proposed sales tax hike, has so far been lukewarm on the United Nation’s “Rio Earth Summit” in Brazil on June 20-22, when politicians, businesses and non-governmental organizations from around the world will try to thrash out standards for sustainable development.

“We are not sure who will lead our delegation,” to the meeting, an official at Japan’s Ministry of Foreign Affairs told reporters on Wednesday. “It probably depends on how Parliament goes.”

The apparent lack of enthusiasm comes only three years after Japan won worldwide praise for its leadership on global environmental issues following its pledge to cut carbon dioxide emissions by 25% from 1990 levels by 2020.

The "Solution" Is Collapse

Only collapse will force everyone to go do something more sustainable to get by

So the root problem is the system, human nature, blah blah blah. There are no "solutions" that can fix those defaults. Thus the "solution" is collapse.

by Charles Hugh Smith

Policies create incentives and disincentives. Some are intended, some fall into the category of unintended consequences. Regardless of their intention, policies that create windfalls ("easy money") or open spigots of "free money" (or what is perceived as free money by the recipient) quickly gather the allegiance of everyone reaping the windfall or collecting the free money.

The World Before Central Banking

The Zombification of the Free Market

by John Aziz

In today’s world, there are many who want government to regulate and control everything. The most bizarre instance, though — more bizarre even than banning the sale of large-sized sugary drinks — is surely central banking.

Why? Well, central banking was created to replace something that was already working well. Banking panics and bank runs happen, and they have always happened as long as there has been banking.

The House of Cards is collapsing

Living within your means is now considered ‘austerity’. And unfair.

By Simon Black

One of the great absurdities of our modern financial system is that a nation living within its means, i.e. spending less than what it confiscates in tax revenue, is no longer the norm.

Whether in the UK, Europe, or North America, many voters have become so accustomed to the government’s massive role in the economy, they can’t begin to imagine how it could be scaled back.

You usually hear heavy objections from people like– “What about roads? If we start cutting budgets, there would be no more roads!”

The ‘road argument’ is one of the most widely misused defenses of government… as if there are no private roads in the world.

Scrap the Euro Now

The common currency was doomed from the start

By Robert J. Barro

Until recently, the euro seemed destined to encompass all of Europe. No longer. None of the remaining outsider European countries seems likely to embrace the common currency. Seven Eastern European countries that recently joined the European Union (Bulgaria, the Czech Republic, Hungary, Latvia, Lithuania, Poland, and Romania) have announced their intention to revisit their obligations to adopt the euro.

Two non-euro members of the European Union, the United Kingdom and Denmark, have explicit opt-out provisions from the common currency, and popular opinion has recently turned strongly against euro membership. In Sweden, which lacks a formal opt-out provision (but has cleverly refused to fulfill one of the requirements for membership), a November poll on whether to join the euro was overwhelmingly negative: 80 percent no, 11 percent yes.

The “cold turkey” approach

Paul Krugman and the European Austerity Myth

by Daniel J. Mitchell

With both France and Greece deciding to jump out of the left-wing frying pan into the even-more-left-wing fire, European fiscal policy has become quite a controversial topic.

But I find this debate and discussion rather tedious and unrewarding, largely because it pits advocates of Keynesian spending (the so-called “growth” camp) against supporters of higher taxes (the “austerity” camp).

Since I’m a big fan of nations lowering taxes and reducing the burden of government spending, I would like to see the pro-tax hike and the pro-spending sides both lose (wasn’t that Kissinger’s attitude about the Iran-Iraq war?). Indeed, this is why I put together this matrix, to show that there is an alternative approach.

An Open Letter to Southern Europeans

I’ll Gladly Pay You Tuesday

by Toomas Hendrik Ilves, President of Estonia

Slowly, ever so slowly, we are realizing, or at least should be, that the fundamental reordering of Europe that began with the crumbling collapse of an overextended and unsustainable communist glacis in the late 1980s has had far greater and far-reaching reverberations than we then would or could have predicted.

Soviet-style communism, even in the short run an unworkable form of despotism since its imposition in 1917, remained so through its iteration by military force and occupation in Eastern Europe in the 1940s. We know that crony capitalism leads to economic busts but crony communism never really even gets off the ground, just seedy privilege — bigger bad cars, better bad health care, better bad education for the children of the well-connected — justified not by achievement but by self-appointment to bring about a more radiant future, because only the self-appointed party is capable of giving hope of a better future. We will shortly meet this phrase again.

Deng Xiaoping realized already in the late 1970s, a decade before the collapse of what by then was simply a Soviet khrushchyovka of worn-out cards that a society or a country cannot borrow on the future, that productive creative labor is what must needs be allowed, and that privilege without merit leads to Soviet-style stagnation. Deng realized social stratification based on party membership, not on accomplishment, was unsustainable and proclaimed: “It is glorious to get rich.” He didn’t say, nota bene, that it is glorious to have free speech and free and fair elections. China realized it needed to change and embraced capitalism without democracy. Moscow was more obtuse, at least until the second half of the 1980s.

How to built an economy from scratch

Estonia Uses the Euro, and the Economy is Booming

It’s the euro zone, but not as we know it.

Sixteen months after it joined the struggling currency bloc, Estonia is booming. The economy grew 7.6 percent last year, five times the euro-zone average.

Estonia is the only euro-zone country with a budget surplus. National debt is just 6 percent of GDP, compared to 81 percent in virtuous Germany, or 165 percent in Greece.

Shoppers throng Nordic design shops and cool new restaurants in Tallinn, the medieval capital, and cutting-edge tech firms complain they can’t find people to fill their job vacancies.

It all seems a long way from the gloom elsewhere in Europe.

Estonia’s achievement is all the more remarkable when you consider that it was one of the countries hardest hit by the global financial crisis. In 2008-2009, its economy shrank by 18 percent. That’s a bigger contraction than Greece has suffered over the past five years.

Is Greater Productivity a Danger?

There are always new uses for human labor

by David Gordon

It is bad enough that opponents of the free market wrongly blame capitalism for environmental pollution, depressions, and wars. Whatever the failings of their causal theories, at least they are focused on undoubtedly bad things. We have really gone beyond the pale, though, when the market is blamed for something good.

Tim Jackson, a professor of sustainable development at the University of Surrey, does just that in his article. "Let's Be Less Productive," which appeared in the New York Times, May 26, 2012.

Jackson suggests that greater productivity may have reached its "natural limits." By productivity, he means "the amount of output delivered per hour of work in the economy." He acknowledges that as work has become more efficient, substantial benefits have resulted: "our ability to generate more output with fewer people has lifted our lives out of drudgery and delivered us a cornucopia of material wealth."

Despite these benefits, danger lies ahead:

Freedom To Leave May Stop Oppressive Government

"When they persecute you in this city, flee into another"

By Lawrence Hunter

The United States of America is in the early stages of a government-induced crack up.  Stress has begun to create structural failures in the interstices but, as yet, has produced only surface cracks on the social facade.

As the stress of oppressive and tyrannical government increases, however, and as its destructive by-products corrode the social edifice—abusive government actions mount, profligate and destructive policies bring economic ruin on the country, corruption becomes endemic, imperial war abroad, class warfare and civil upheaval at home plague the nation, cities decay—structural cracks will appear and become visible even to the most stupefied American.  More and more people will become aware of the extensive damage that oppressive, albeit democratically elected government has inflicted on American society.  At that point, people will be roused from their stupor to ask, “What happened” but by then, it will be too late.