Bringing LIBERTY to Capitol Hill -- 2008
OZARKS VIRTUAL TOWN HALL
Saturday Morning, October 18, 2008, 10:30am
A Discussion of The President's Saturday Morning Radio Address
Click here to listen to a replay of the October 18, 2008 Ozarks Virtual Town Hall
Notes and Summary of the President's Address: "The Bailout is not Fascism. Trust me."
THE PRESIDENT: I know many Americans have reservations about the government's approach, especially about allowing the government to hold shares in private banks. As a strong believer in free markets, I would oppose such measures under ordinary circumstances. But these are no ordinary circumstances. (continued below)
How the President Differs from the American vision of "Liberty Under God":
- America was founded on the philosophy of "Liberty Under God."
- "Liberty" means freedom from government suppression of ideas and confiscation of wealth
- "Under God" means we have a personal responsibility to love God and neighbor.
- Human beings are endowed with the right to property by God, not the government.
- The original American Dream: Everyone dwelling safely under his own Vine & Fig Tree
- America's Founders spoke of this as "an Experiment in Liberty" (1787-1887)
- The "experiment" was a success: a Free Market made America the most prosperous and admired nation in history
- In the 20th century, the experiment in liberty was replaced with another experiment: an experiment in central planning
- The original American dream of personal, private ownership, has been replaced with private indebtedness and public control.
- Nothing in the President's Agenda reduces socialism and promotes Free Markets.
- The President has forgotten the limits placed on his authority by the Constitution. He does not have the Constitutional authority to spend a trillion dollars.
- The central problem in this "crisis" is a system of "false weights and measures." Banks create "counterfeit" money to lend. The debt (and the interest) is sold to investors, who stand to lose money if the borrower does not repay the "fiat money." If the government were not fraudulently debasing the currency, creating new money to be loaned out at interest, the debt-pyramid would never be created in the first place.
Saturday Morning Radio Address
"Liberty Under God"
|THE PRESIDENT: Good morning. Our Nation is dealing with a serious financial crisis. Over the past month, Americans have witnessed fast-moving events involving complicated financial issues. I know many of you are concerned about your finances. So this morning, I want to tell you how we're addressing the uncertainty in our economy.
||"Uncertainty" is not the problem. Ignorance is the problem. Ignoring that which is certain is the problem. It is certain that the federal government is the cause of the current crisis. The government created the money to lend to those who certainly couldn't pay it back, guaranteed the loans so they could be re-packaged and traded, and is now bailing out those who knew or should have known for certain that these were bad loans and bad investments.
|The federal government has responded to this crisis with systematic and aggressive measures to protect the financial security of the American people. These actions will take more time to have their full impact. But they are big enough and bold enough to work.
||George Kaufman, a finance professor at Loyola University Chicago, is skeptical. "The last refuge of a scoundrel regulator," he says, "is to shout 'systemic risk.'" Usually, the alarm is false. He notes that aside from inter-bank lending, the credit markets were functioning tolerably well at the height of the crisis. Rates on 30-year mortgages actually dropped last week.
-- from a column by Steve Chapman, September 25, 2008
The Federal Reserve System is the problem. It is not being touched by the current "reform."
|The primary focus of our efforts is addressing the underlying problem behind the freeze in our credit markets. Earlier this month, Congress passed bipartisan legislation authorizing the Treasury Department to use up to $700 billion to help banks rebuild capital. This week, I announced that the Treasury will use a portion of that money to inject capital directly into banks by purchasing equity shares. This new capital will help banks continue making loans to businesses and consumers. In addition, the Treasury will use part of the $700 billion to purchase some of the troubled assets that are weighing down banks' balance sheets and clogging the financial system. This extraordinary effort is designed with one overriding purpose: to
help banks get loans flowing to American consumers and businesses, so they can create jobs and grow our economy.
||The "underlying problem" is the debasement of our currency, the inflation of our credit system. Government does this deliberately.
If the government wanted to help "businesses and consumers," why doesn't it just give the money it creates (out of thin air) directly to businesses and consumers? Instead, it gives the newly-created money to banks so they can lend to businesses and consumers and make a ton of money on the interest businesses and consumers will have to pay to the banks.
Bankers (like Wall St. CEO/Treasury Secretary Paulson) run the system for the benefit of bankers.
|I know many Americans have reservations about the government's approach, especially about allowing the government to hold shares in private banks. As a strong believer in free markets, I would oppose such measures under ordinary circumstances. But these are no ordinary circumstances. Had the government not acted, the hole in our financial system would have grown larger, families and businesses would have had an even tougher time getting loans, and ultimately the government would have been forced to respond with even more drastic and costly measures later on. So I decided that government had to move, but that government's involvement in individual banks had to have prudent limits.
Never have markets been less free. This man is deeply, profoundly self-deceived.
Understand how "The Invisible Hand" of the Free Market works without government regulation and intervention
Capitalism or Freedom
|The government's involvement is limited in size. The government will only buy a small percentage of shares in banks that choose to participate, so that private investors retain majority ownership.
|The government's involvement is limited in scope. The government will not exercise control over any private firm, and federal officials will not have a seat around your local bank's boardroom table. The shares owned by the government will have voting rights that can be used only to protect the taxpayer's investment -- not to direct the firm's operations.
||Local banks are governed by an extraordinary array of regulations from Washington D.C. Your local bank's board members are virtually pawns of D.C. regulators. Your bank got to decide whether to make a bad loan to Smith, or whether to make a bad loan to Jones, but the decision to make bad loans was made in Washington D.C. when it imposed the "Community Redevelopment Act."
|The government's involvement is limited in duration. It includes provisions to encourage banks to buy their shares back from the government when the markets stabilize and they can raise money from private investors. This will ensure that banks have an incentive to find private capital to replace the taxpayer's investment -- and to do so quickly.
||This is merely the latest in a string of unconstitutional government involvement that goes back at least 80 years.
|I know many of you are also concerned about the price tag of this
|bailout rescue package. Ultimately, we believe the final cost will be significantly less than the initial investment. Many of the troubled assets that the government buys will increase in price value as the market recovers. That means the government eventually will be able to resell them for a higher price. In addition, the government will receive quarterly dividends from the equity shares it purchases in financial institutions. If banks do not repurchase these shares within five years, the dividends they owe the government will increase substantially. This provides a clear incentive for banks to buy back their shares, thus returning the money to taxpayers, as soon as possible. |It is a good thing for the price of computers to be continually falling, even as the speed and quality of computers goes up.
Why is it a good thing for the price of housing to go up?
The only people who benefit from the rising price of housing are speculators and bankers.
In a truly free economy, the price of everything is always going down.
|In the long run, the American people can have confidence that our economy will bounce back. America is the best place in the world to start and run a business, the most attractive destination for investors around the globe, and home to the most talented, enterprising, and creative workers in the world. We're a country where all people have the freedom to realize their potential and chase their dreams. This promise has defined our Nation since its founding, this promise will guide us through the challenges we face today, and this promise will continue to define our Nation for generations to come.
||You can have confidence that even after you're mugged in a dark alley, you will still be in possession of most of your assets.
Does this make the mugging a good thing?
Washington D.C. is a ring of muggers. They do not deserve our respect. They are engaged in systematic plunder.
| Thank you for listening.
A complete collection of libertarian resources regarding the Wall St. Bailout are here. Here are some new additions from this past week:
Kevin Craig's Platform:
- "Vine & Fig Tree" - the original American Dream - work, profit, save, invest, enjoy - not "easy to borrow," perpetual debt.
- Pursuit of Happiness, not right to happiness - risk-takers must take personal responsibility. "Free Enterprise" means profit and loss.
- Allowing irresponsible businesses to fail is good.
- Econonomic Theory for the American Free Enterprise System
- My Message to Leaders
- The Doctrine of "Enumerated Powers" - Government only has those powers delegated to it by "We the People" in the pages of the Constitution. Bailing out Wall Street was not one of those powers.
- Government causes bankruptcy.
- Government causes inflation.
- Government caused "The Great Depression"
- Government bails out special interests, does not promote the "general welfare."
- Why do people need to get a loan? Government takes more than half of everything you earn, leaving you with less than you need. The average family now pays more in taxes than it spends for housing, clothing, and food combined.
- Thinking Biblically about the Banking Crisis
- How Much Red Ink in a TRILLION Dollar Bailout?
- Interest Rates Should be Higher
From the Blog
Is there a "Crisis?" Really?
- The drying up of credit is a myth, as Robert Higgs explains: Credit Is Flowing, Sky Is Not Falling, Don’t Panic.
- Credit for the uncreditworthy should be allowed to dry up. The flood of such credit was created by the government to gain votes.
- On The Media: Transcript of "Rescue Mission" (September 26, 2008)
- Sheldon Richman asks, Is This What It's All About? He quotes business reporter Ali Velshi of CNN, talking about the alleged credit drought on Tuesday when he stopped and said (roughly), "When I say 'dried up,' I don't mean there's no money. But you'd better have good collateral and good credit." In other words, "credit worthy."
In other words, a trillion dollar bailout is designed to prevent a resurgence of responsible lending.
- Bernanke's Hype - Forbes.com
Additional "Liberty Under God" Resources
See our 2008 Bailout page for more resources.
It would probably be depressing to compare the average university economics curriculum (and the understanding the average university economics student has of the current "bailout" crisis) with the following worthwhile links:
- The Bailout Reader - A Collection of papers from the Mises Institute, listed below.
- Notablog: A Crisis of Political Economy - Another "reader" by Chris Sciabarra, a Visiting Scholar at New York University - a complete course in economics relating to the current "crisis," if you follow the links.
- Fannie Mae Eases Credit To Aid Mortgage Lending - New York Times, September 30, 1999, describing efforts by Democrats in the Clinton Administration to create the current crisis.
- Barney Frank's fingerprints are all over the financial fiasco - Jeff Jacoby, The Boston Globe
- Media Mum on Barney Frank's Fannie Mae Love Connection
Barney Frank is a homosexual. One of his "lovers" was a Fannie Mae executive. (Could this be an argument for homosexual "marriage?" After all, if they were officially, legally "married," there might have been some "conflict of interest" issues. But there are undoubtedly a large number of similar conflicts with heterosexuals in and out of Congress who are not "married" to each other.)
- The Corporate State Fails
"According to popular myth, the current financial turmoil is the result of Bush administration deregulation. One problem with that theory: there was no deregulation. The last banking deregulation, the Gramm-Leach-Bliley bill, was signed by President Bill Clinton in 1999. Oops."
"Let’s hear no more about Republicans’ loving limited government."
- Government Failure
To hear the media pundits and presidential candidates tell it, you’d think Adam Smith has been president for the last eight years and, with a Congress full of free-market advocates, had enacted an agenda of full-blown laissez-faire.
But believe it or not, the problems in the financial and housing industries are not a market failure. They are a government failure.
- Photo of House Bailout Leader.
Fannie Mae and Freddie Mac
- Freddie Mac: A Mercantilist Enterprise, by Paul Cleveland, March 14, 2005
- Fannie Mae: Another New Deal Monstrosity, by Karen De Coster, July 2, 2007
- How Fannie and Freddie Made Me a Grumpy Economist, by Christopher Westley, July 21, 2008
- Who Made the Fannie and Freddie Threat? By Frank Shostak, March 5, 2004
- Are Fannie and Freddie Too Big to Fail? By Frank Shostak, September 17, 2008
- Fannie Mae Distorts Markets, by Robert Blumen, June 17, 2002
The Housing Bubble
- The Housing Bubble in Four Easy Steps, by Mark Thornton, September 27, 2008
- The Real Cost of a Full Bailout, by Don Rich, August 22, 2008
- The Subprime Mortgage "Crisis" Will Fix Itself, by Steve Berger, May 30, 2007
- Did the Fed Cause the Housing Bubble? By Robert Murphy, April 14, 2008
- The Mortgage Market Mess, by Christopher Westley, May 17, 2007
- Housing Bubble: Myth or Reality? By Frank Shostak, March 4, 2003
- What's Behind the Financial Market Crisis? by Antony Mueller, September 18, 2008
- Our Financial House of Cards, by George Reisman, March 25, 2008
- Will Central Bankers Become Central Planners? by Robert Blumen, July 31, 2008
- Inflation is a Policy that Cannot Last, by Thorsten Polleit, March 14, 2008
- The Widening Safety Net, by Christopher Mayer, March 19, 2004
- The Fed's New Tricks Are Creating Disaster, Frank Shostak, March 18, 2008
- The Fed's War on the Middle Class, by Mark Thornton, June 4, 2008.
- Austrian Economics and Financial Markets conference at The Venetian Hotel Resort Casino, Las Vegas, 02-18-2005
Community Reinvestment Act
The Austrian Theory of the Business Cycle
- The Idiocy of Wall Street, by Don Rich, September 24, 2008
- The Fed is Culpable, by Hans F. Sennholz, November 11, 2002
- Skyscrapers and Business Cycles, by Mark Thornton, August 23, 2008
- Economic Outlook 2008: Darkening Clouds, Dominick Armentano, January 2, 2008
- Business Cycle Primer, Llewellyn H. Rockwell, Jr. February 8, 2001
- Economics Depressions: Their Cause and Cure, by Murray Rothbard
Who Predicted This?
- The Financial Apocalyptics are Back, Robert Blumen, July 25, 2007
- Sowing the Seeds of the Next Crisis, Thorsten Polleit, April 25, 2006
- Credit Crisis: Precursor of Great Inflation, by Thorsten Polleit, February 7, 2008
- Mr. Bailout, by Anton Mueller, September 30, 2004
- America's Unsustainable Boom, by Stefan Karlsson, November 8, 2004
- Who Predicted the Bubble? Who Predicted the Crash? By Mark Thornton, July 14, 2003
What To Do
- The Rescue Package Will Delay Recovery, September 29, 2008
- Don't Bail Them Out, by Llewellyn H. Rockwell, Jr., September 10, 2008
- How to Avoid Another Depression, by Mark Thornton, September 10, 2008
- Taking Money Back, By Murray N. Rothbard, June 14, 2008
- Beware the Alchemists, by Ludwig von Mises, February 3, 2006
- Reflation in American History, by H.A. Scott Trask, October 31, 2003
- Money and Freedom, by Joseph Salerno, February 2, 2002
- The Case for a Genuine Gold Dollar, by Murray Rothbard
- Interview with Frank Shostak, September 30, 2008
Books to Distribute
- The Theory of Money and Credit, by Ludwig von Mises
- America's Great Depression, by Murray Rothbard
- The Mystery of Banking, by Murray Rothbard
- Prices and Production, by F.A. Hayek
- Causes of the Economic Crisis, by Ludwig von Mises
- Austrian Theory of the Trade Cycle and Other Essays, by Ludwig von Mises, et al.
- Understanding the Dollar Crisis, by Percy Greaves
- The Case Against the Fed, by Murray Rothbard
- Money, Bank Credit, and Economic Cycles, by Jesus Huerta de Soto
- History of American Currency, by William Graham Sumner
- Banking and the Business Cycle, by C.A. Phillips
- Fiat Money Inflation in France, by Andrew Dickson White
What Would America's Founding Fathers Do?
The men who threw tea into the Boston Harbor over a tax of 3 pence per pound would not be happy with a tax ten times greater on every gallon of gas. Those who took up muskets over a total tax burden of less than 3% would not be happy with the fact that the federal government now takes more than half of everything you earn.
Today it is illegal for public school teachers to teach their students that the Declaration of Independence is really true (and not just an outdated historical document). The federal government is clearly at war with everything the Founding Fathers stood for.
America's greatest Americans would abolish today's federal government.
Muskets are Not an Option
There are two reasons why we should not take up arms to pull off the violent overthrow of the federal government, even if America's Founders would surely do so. First, the feds have nukes. Second, violent revolution is unChristian and unBiblical. We must beat our swords into plowshares and use persuasion to abolish tyranny. This is time for a revolution of ideas.
Revolution Won't Come in a Day
John Adams once wrote that the American Revolution began in 1761, when Massachusetts attorney James Otis began legal challenges to the Writs of Assistance. He lost the case, but "American independence," Adams wrote, "was then and there born." Now do the math. That means it took 15 years to convince the rest of America to declare Independence (1776). Then another seven years of war was required before a Peace Treaty was signed (1783), and then six
years before the Constitution was finally ratified (1789). That's almost 30 years. (And Jefferson said we shouldn't go 20 years without another rebellion!) How can we hope to convince Americans to fight for principles they were never taught in government schools? We need to be in this battle for the long term. "Eternal Vigilance is the Price of Liberty."
The Internet Can Speed up the Revolution
Here are ways you can help.
Support This Campaign
Send emails. Find out how this free tool can change everything.
Vote Against Every Politician Who Voted for the Bailout, No Matter What
Communicating with Government and Media
- Contact Congress -- this is from the JBS website, powered by "CapWiz," from Capitol Advantage. Lots of organizations use capwiz. If you don't want to go through the JBS, search for capwiz on Google and find another organization that uses it.
Notice that you can also contact media through this webpage.
- Action E-List
Sign up for the JBS Action E-List and be notified when you can make a critical difference on important issues.
||Make Congress Read Their Bills Before Voting
Make Congress read every word of every bill they create before they vote on it.
Urge your Representative and your Senators to sponsor DownsizeDC.org's “Read the Bills Act” (RTBA).
|TWIC - A Backdoor Real ID Card|
Real ID is dying. But the Department of Homeland Security has a new plan to subject every American to a national ID card anyway. They plan to pick off one occupational field at a time, starting with the maritime industry. One man is fighting back. Meet him, and help stop this backdoor Real ID plan.
||Stop the Killer Horse Hormones
The FDA "outlawed" the use of Estriol, an estrogen medication that's bio-identical to human estrogen. Doctors must now prescribe animal-derived estrogen instead. Are bio-identical hormones dangerous, while animal-derived hormones are safe? No. The practice of medicine is moving to chemically identical to human hormones and away from animal hormones. Learn why the FDA decided to endanger women's health in this way, and take action.
|End Asset Forfeiture|
If the government suspects you used your house or car in a crime, they can take it and sell it at auction. They don't even have to prove your guilt. They call this practice civil asset forfeiture, but it's really theft. It violates the 4th, 5th, 6th, 8th, 9th and 14th Amendments. It also encourages law enforcement to put profits before justice. Tell Congress to end civil asset forfeiture.
Support an Iraq Referendum
Americans keep debating when, how, or if to leave Iraq. Maybe we should ask the Iraqi people what they want. After all, it's their country. Tell Congress to request that the Iraqi government hold a public referendum on the U.S. occupation. Learn more »
"Cap and Trade" is not the way
The politicians seem to be unifying around "cap and trade" as a way to cut CO2 emissions. If they take this step it may be the largest increase in the size, scope, and intrusiveness of government since the creation of Medicare. Worse still, it may not even achieve its purpose. Please tell Congress to oppose "cap and trade." Learn more »
Big government prospers through failure. Each new failure is used to justify more spending and new powers. Wasteful spending in Iraq is the latest example. One way to change this is to hold government accountable. A new bill in Congress seeks to provide some of the needed accountability. Please support it. Learn more »
Stop the War for Terror
U.S. policy has inflamed the Middle East. It has made terrorism more likely rather than less. We seem to be fighting a war for terror, rather than on terror. This policy must stop. The place to start stopping is with Iran. We must not attack Iran. War with Iran would devastate our economy, disrupt world oil supplies, and recruit more terrorists. Click here to stop this war before it starts.
The Democrat Party Radio Address:
The The Democratic Radio Address was a campaign commercial delivered by US Representative Rahm Emanuel. He claimed that Obama is going to provide tax relief, and also provide free energy and health care for everyone.
Click here for a replay of this edition of the Ozarks Virtual Town Hall