The True Meaning of Christmas

St. Nicholas

December 25 is not Jesus’ birthday. Christmas is based on the winter solstice. In a great many religions from the Old World, the solstice marked the day that the vegetation god died, typically by being crucified on a tree, causing all the earth’s vegetation to die with him only to be reborn on the spring equinox. Thus the death and resurrection of the god symbolized the death and resurrection of vegetation throughout the year.

None of the gospels give an exact date for the birth of Jesus. The Gospel of Luke mentions shepherds out tending sheep in the late evening, which some have taken to mean it wouldn’t be in the winter since sheep would have been locked up. Luke puts his birth at 6 A.D., a symbolic year for Jewish resistance as Luke specifically makes reference to the Roman tax census that triggered a revolt by Judas the Galilean (a Zealot figure who probably inspired Judas Iscariot, seeing how his surname is a reference to Sicarii assassins). The Gospel of Matthew tells the story of the Three Magi visiting Herod the Great on their way to meet baby Jesus, but Herod didn’t die until 4 B.C., a full 10 years before the tax census.

Around 200 A.D., St. Clement of Alexandria gave three different dates various churches used to celebrate Jesus’ birthday. None of them were December 25. Another Alexandrian theologian named Origen mocked Roman celebrations of birth anniversaries, dismissing them as “pagan” practices.

Tertullian, the first Latin father to mention the Trinity, in particular condemned decorating the home with boughs of evergreen, saying:

“Let them over whom the fires of hell are imminent, affix to their posts, laurels doomed presently to burn: to them the testimonies of darkness and the omens of their penalties are suitable. You are a light of the world, and a tree ever green. If you have renounced temples, make not your own gate a temple.”

Even the 2,600-year-old Biblical prophet Jeremiah condemned a ritual seemingly identical to Christmas, saying: “For the customs of the peoples are worthless; they cut a tree out of the forest, and a craftsman shapes it with his chisel. They adorn it with silver and gold; they fasten it with hammer and nails so it will not totter” (10:3-4).

The first Christian linking Jesus’ birth to Christmas comes from an Egyptian in the mid-300s, and by the late 360s, the Donatists, an African Christian sect that broke away from the “traitors” who allied themselves with Emperor Constantine, accepted Christmas on December 25 but not the Epiphany on January 6.

Some time during the Middle Ages, the Christmas tree became associated with the tree from the Garden of Eden, called the “Paradise Tree,” and decorated with apples, a concept hardly alien from the original pre-Hebrew myth. The first recorded Christmas tree was erected in the house of a military brotherhood in Estonia in the mid-1400s. A Bremen guild chronicle of 1570 records how a small tree decorated with apples, nuts, dates, pretzels and paper flowers was put up in the guild house for the members’ children. Most Christmas trees were found only in churches until the 1500s, but even in the mid-1800s, they were still controversial enough to bring threats against Henry Schwan of Cleveland Ohio, the first American pastor to erect a Christmas Tree in his church. The Puritans likewise condemned Christmas, with Oliver Cromwell outright banning “the heathen traditions” of Christmas carols, decorated trees and any joyful expression that desecrated “that sacred event.” Martin Luther tried replacing the bearer of gifts with Christkindl, the “Christ Child”, but the name was only transferred over to St. Nikolaos, which is why Santa Claus is also known as “Kriss Kringle.” Decorating the tree with expensive-for-the-time candles comes from the 1700s and by the 1800s Christmas trees were showing up in Germany’s schools, inns, and military hospitals.

The winter solstice was important in ancient times because there was little food and starvation was common, so the solstice was meant to be the last feast celebration before everyone had to hole themselves up for winter. Most cattle were slaughtered to save on food, so the solstice feast was one of the few times anyone could eat as much meat as they wanted. Wine and beer stored for fermentation was opened up at this time. The reason Christmas Eve holds particular importance is because the pre-Romanized day began in the evening previous, just as the Jewish Sabbath does today.

In Roman times, the solstice festival was named Saturnalia after the god of time and agriculture. According to the third-century Neo-Platonic philosopher Porphyry, Saturnalia occurred near the winter solstice because the sun enters Capricorn, the astrological house of Saturn, at that time. The holiday was celebrated with a sacrifice at at Saturn’s temple and a public banquet followed by private gift-giving.

There was a carnival atmosphere, complete with costumes and role-playing, a time when social norms could be overturned: gambling was permitted, no declaration of war could be made, and masters provided table service for their slaves. Both citizen and slave wore the cone-shaped pileius cap, representing the wearer as a freedman. The reversal of social roles aspect of the holiday was inherited from the Athenian festival of Kronia, named after Kronos (linked to the root word “chron,” as in “chronology” or “chronicle”), the Greek equivalent of Saturn, although the Greek holiday was actually celebrated in the summer.

Wikipedia says that:

The day of gift-giving was the Sigillaria on December 23. Because gifts of value would mark social status contrary to the spirit of the season, these were often the pottery or wax figurines called sigillaria made specially for the day, candles, or “gag gifts”, of which Augustus was particularly fond. In his many poems about the Saturnalia, Martial names both expensive and quite cheap gifts, including writing tablets, dice, knucklebones, moneyboxes, combs, toothpicks, a hat, a hunting knife, an axe, various lamps, balls, perfumes, pipes, a pig, a sausage, a parrot, tables, cups, spoons, items of clothing, statues, masks, books, and pets. Gifts might be as costly as a slave or exotic animal. Patrons or “bosses” might pass along a gratuity (sigillaricium) to their poorer clients or dependents to help them buy gifts. Some emperors were noted for their devoted observance of the Sigillaria.

The revelries and dropping of social status of Saturnalia were supposed to reflect the conditions of the lost mythical age, when Saturn, or Kronos, reigned over the world during a time of limitless bounty of the earth without labor in a state of social egalitarianism known as the Golden Age, the same as the Biblical Eden.

The Jewish Talmud ascribes the origins of this festival to Adam, who saw that the days were getting shorter and became afraid that the world was returning to the chaos and emptiness that existed before creation because of his sin, and so fasted for 8 days, representing the 8 days between Saturnalia and the winter solstice. When the days grew long again, he realized it was the earth’s natural cycles, and so made 8 days of celebration, representing the 8 days between the soltice and the festival called Kalend. Only later was the festival turned into something pagan, according to the text.

Christmas day also marked the first day of the year for the Anglo-Saxons, the German tribes that invaded Great Britain in the 400s and ruled the newly dubbed Angle-land (England) until the Norman conquest in 1066. Around 730 A.D., the venerable Latin monk Bede wrote:

They began the year with December 25, the day some now celebrate as Christmas; and the very night to which we attach special sanctity they designated by the heathen term Modraniht, that is, the mothers’ night — a name bestowed, I suspect, on account of the ceremonies they performed while watching this night through.

In Germany, the Yule festival was celebrated for 12 days from late December to early January on a date determined by the lunar Germanic calendar. The legendary Ynglinga Saga, written by the Old Norse Icelandic poet Snorri Sturloson in 1225, mentions a Yule feast being celebrated as early as 840. In the Saga of Hákon the Good, Snorri gives a vivid description of the German festival:

It was ancient custom that when sacrifice was to be made, all farmers were to come to the heathen temple and bring along with them the food they needed while the feast lasted. At this feast all were to take part of the drinking of ale. Also all kinds of livestock were killed in connection with it, horses also; and all the blood from them was called hlaut [sacrificial blood], and hlautbolli, the vessel holding the blood; and hlautteinar, the sacrificial twigs [aspergills]. These were fashioned like sprinklers, and with them were to be smeared all over with blood the pedestals of the idols and also the walls of the temple within and without; and likewise the men present were to be sprinkled with blood. But the meat of the animals was to be boiled and served as food at the banquet. Fires were to be lighted in the middle of the temple floor, and kettles hung over them. The sacrificial beaker was to be borne around the fire, and he who made the feast and was chieftain, was to bless the beaker as well as all the sacrificial meat.

The first toast was to be drunk to Odin “for victory and power to the king,” the second toast to Njörðr and Freyr “for good harvests and for peace,” the third toast was to be a beaker drunk to the king himself, with final toasts to the memory of departed kinsfolk.

Children would fill their boots with carrots, straw, or sugar and place them near the chimney for Odin’s flying gray horse, Sleipnir, to eat. Black ravens would listen from the chimney hole in the house to figure out which children were naughty and which were nice before the large white-bearded Odin would enter and reward the good children by replacing Sleipnir’s food with gifts or candy. Thor, whose home was in the snowy “Northland”, also rode a flying chariot pulled by two white goats, Cracker and Gnasher, and came down the chimney holes directly into the fire, which was his natural element.

St. Nikolaos’ popularity skyrocketed during Medieval times. The propensity of paintings of Nikolaos was matched only by the Virgin Mary, with almost 400 churches dedicated to him in England during the late Middle Ages. The earlier Yule-themed traits of Odin and Thor passed on to the German Sinterklaas since the Feast of St. Nikolaos was on December 6. This may be related to the fact that the 6th of each month was considered the birthday of the goddess Artemis, the same goddess many of the temples that St. Nikolaos had destroyed was dedicated to. After the Protestant Reformation, Nikolaos’ popularity dwindled in the west, except in the Netherlands. The image of Santa being a fat man comes from the Dutch-American poet Clement Moore in 1823, although Coca Cola ads helped trim his wild nature beard and dropped the smoking pipe.

Nikolaos the ConfessorClement Moore's Santa

St. Nikolaos was originally from Myra in Asia Minor, but his remains were taken to Mari in southern Italy in 1087, and by the late 1400s the city was in control of Spain, which was part of the Moorish Empire of African-Arab Muslims. This is why in the mid-1800s, Dutch folklore described the companions of Sinterklaas, “Zwarte Pieten”, or “Black Petes,” as little Moorish children. These “helper elves” were said to navigate the steam boat that took Sinterklaas from Spain to the Netherlands and took the role of the black crows in listening from the chimney holes and stuffing presents down the ones who had good children. Sinterklaas’ giant bag contained not just candy for nice children but a chimney sweep’s broom to spank naughty children, and some of the older Sinterklaas songs even say the bag was used to carry naughty children back to Spain. In Belgium, “Black Petes” still dress up in colorful moorish clothing and scatter pepper nuts, spice nuts, and special Christmas candies called “strooigoed” to those who ran into Sinterklass as he went around town.

Nikolaos and Black Pete

The relation between Sinterklaas and Black Pete also mirrors the relationship between Amoo Nowruz (“Uncle New Day”), a white-bearded “Father Time” figure who brings gifts on the eve of the Spring Equinox, and Hajji Firuz, little black-faced, red-suited harbingers of the Persian New Year. These soot-covered tambourine players are believed to come from the tradition of the “Mir-Norowzi,” a comical figure that was paraded around the city and given the power of being king for five days.

Black PeteHajji Firuz
Left: Black Pete and Sinterklaas; Right: Hajji Firuz

The red clothes and soot-covered faces and red clothes of the Hajji Firuz apparently goes back to the red-dressed fire-keepers of the Zoroastrians, who at the last Tuesday of the year, was sent by the Zoroastrian priests to spread the news about the arrival of the New Year and call on the people to renew their lives by burning their old items in the fire. The dualistic religion of Zoroastrianism seems to have contributed to the concept of armies of angels and demons doing battle with one another in Christianity since nothing in the Old Testament gives the Judaic Satan from Job that kind of power or authority. And in fact, other Alpine folktales tell of Sinterklass’ companion being the devil, who was shacked to him and made his slave, which fostered the concept of the satyr-like Krampus of Austrian lore. Sources from Germanic Europe identify Black Pete and the Sinterklaas’ demonic slave as being one and the same.

Like Batman, Nikolaos the Confessor used the inheritance from his tragically deceased parents to help the needy. Although Santa passing out candy can be traced back to Odin, the tradition is more popularly linked with the legend of St. Nikolaos sneaking golden coins into the homes of three impoverished families through the windows in order to prevent the desperate families from having to sell their daughters into prostitution for food. Other 11th-century legends tell how he was able to identify a butcher who murdered three children (or inn residents) and was trying to sell their butchered remains as ham, and then resurrected the children. Another legend says that after convincing sailors taking wheat to Emperor Constantine to donate some to the famine-hit people in the city of Mysa that they would not suffer for it, the sailors found that the wheat weighed the same after arriving at Constantinople. Another legend says that Nikolaos set sail for Jerusalem, but after having a Satanic dream, he prophecized a storm and then, a la Jesus, halted the storm and resurrected a sailor who had been blown off a mast. In Jerusalem, church doors magically opened for him, but having not stollen Jesus’ bit enough, he went into the desert to pray but was called back to Mysa so that he could walk through the church doors at just the right time to fulfill a vision given to one of the church elders that an bishop position should be given to the person to next walk through the door.

St. Nikolaos sneaking coins through the window

Although St. Nikolaos is not listed among the debaters at the famed Council of Nicaea, there is another legend that he passionately debated with the theologian Arius over whether Jesus was one and the same in God or a creation of God. Arius argued that the title “Son of God” insinuated inferiority to the Father, saying, “What argument then allows, that He who is from the Father should know His own parent by comprehension? For it is plain that for that which hath a beginning to conceive how the Unbegun is, or to grasp the idea, is not possible.”

And for that, jolly ol’ Saint Nick bitch-slapped him.

Nikolaos was kicked out from the council and Constantine threw him in prison, so says the legend, but then Jesus and the (now official) Mother of God vindicated him. In dreams, of course. The dreams brought the priests and bishops to Constantine begging to let pimp daddy Santa out of prison, which Constantine did after he saw Nikolaos produce both gospel and bishop garments from within his cell. So I guess the lesson here is it is completely all right to resort to violence to prove abstract theological points that even Constantine loathed.

Another similar legend says that Nikolaos helped stop one of Constantine’s armies from sacking the city and then saved three generals from being executed by appearing in a dream to Constantine, who rewarded the three men with golden gospels and incense burners, making St. Nick the patron saint of the falsely accused.

The afore-mentioned 13th-century Icelandic poet Snorri credits the 10th-century King Haakon I of Norway with being the first to combine the Yule festival with Christmas. Although Haakon kept his Christian religion secret at first, he eventually wielded enough power to request a bishop and priests from England to convert the country. By the 1200s or early 1300s, Yule became equated with Christmas, with The Grettis Saga saying that all Christians fasted from meat the day before Yule in preparation of the feast.

In the 1100s A.D., a marginal note written by a Syrian Biblical commentator, Dionysius bar-Salibi, said that Christmas had been moved from January 6 to December 25 so that it fell on the same date as the holy day for the pagan Sol Invictus, the Roman version of the Zoroastrian-inspired sun god Mithras that Constantine had worshiped. His birthday was also December 25. Macrobius, one of the last fifth-century Latin authors not to convert to Christianity, said that the proximity of the Saturnalia to the winter solstice led to an exposition of solar monotheism, the belief that Sol Invictus ultimately encompasses all divinities as one.

Some Biblical scholars have suggested that the date for Christmas was actually determined by calculating the date back 9 months from Passover to the day of his conception, the Annunciation, under the assumption that early Christians were following a Jewish tradition that creation (the Nativity) and redemption (the Crucifixion) occurred at the same time, but Passover and the Annunciation are also derived from the Spring Equinox, or Easter.

The Canaanite fall harvest was changed by the Israelites into Succoth, when they were to move into booths in remembrance of the Exodus, and the Canaanite New Year festivals became Rah ha-Shanah and Yom Kippur, the day of repentance. The Semitic early spring festivals which celebrated the birth of the new lamb became historicized into the Passover, when the blood of lambs was to be put on doorposts.

Even the very minor celebration of Hanukkah probably only showed up on Jewish calendars to provide some kind of a substitute for the winter festival of their neighbors. As David Frum points out, the Pharisee sect that eventually became Orthodox Judaism was actually in contention with the Maccabbees who miraculously held out against the Syrians by the power of divinely enduring lamp oil since the Maccabees not only took over the throne of Jerusalem but also the priesthood, breaking the Biblical law that only Levites could be priests. Since the whole rebellion was based around having to sacrifice against the rules of the Bible, it was understandably a controversy. (Not to mention the fact that the Maccabees allied against the Syrians with the Romans, the same guys who eventually burned down the Temple and put an end to Jewish sacrifice forever.)

The name Easter is based on the Saxon goddess Eostre, which is also related to the word “east” because the sun rises in the east, representing the resurrection of the sunlight. She is also equivalent to the Greek Aphrodite and the Roman Venus, whose lover Adonis is also crucified to a tree and was resurrected in the Spring. Fertility symbols such as the highly reproductive bunny and the egg became associated the rebirth of new life that comes in the spring.

Comic

In Norse mythology, the vegetation god Baldr (of Baldur’s Gate fame) is killed by a dart made from mistletoe and just like Jesus in the apocryphal Gospel of Nicodemuis, goes to Hel(l) to be resurrected during the Norse Apocalypse, called Ragnarok. Baldr had visions of his own death, as did his mother Frigg, wife to Odin, so Frigg forced all things on the earth to vow not to hurt Baldr except for the mistletoe, so of course, mistletoe became his kryptonite. After being shot by a mistletoe dart by his blind brother Hodr, who is sometimes guided by Loki, Frigg made an arrangement with the queen of the underworld, Hel, to release Baldr if everything in the world wept for him, but a female giant named Thokk, which some sources say was Loki in disguise, refused to weep for him, and thus prevented his resurrection.

Mistletoe is actually a parasite that grows off the branches from bird droppings and thrives during the winter, making it a suitable scapegoat for the destruction of vegetation during that time. Pre-Christian Europe viewed mistletoe as a representation of divine male fertility, possibly because its berries look like semen. Somewhere along the line this turned into kissing under the mistletoe.

The weeping for Baldr also mirrors the ceremonial “weeping for Tammuz,” which many women from Jerusalem did during the 7th century B.C., much to the prophet Ezekiel’s own chagrin (8:14). The symbol of Tammuz was the Tau cross, from which we get the letter T from. In Sumerian times, he was known as Dumuzi (literally “Good Son”), the Crucified Bread and Beer God who rose on Easter and was known as both “Shepherd” and “Fisherman.”

Tau Cross
Sumerian Cylinder From Nippur linking the plowing of grain with the Tau cross.

Dumuzi’s lion-riding wife Inanna was known in the Akkadian language as Ishtar, which is probably related etymologically with Eostre. In Canaan she was known as Asherah, and the Old Testament violently condemns those who worshipped her Asherah poles which symbolized the Tree of Life on which her lover was crucified on. Not only is there a long theological history behind associating Jesus’ cross with the Tree of Life, but infact other than the four gospels and a couple of very late pseudographical epistles attributed to Paul in the late second century, the New Testament refers only to Jesus being “hung on a tree.” The “Sacred Marriage” held between Dumuzi and Inanna was the subject of much erotic Sumerian poetry, which is mirrored in the Biblical Song of Solomon. There are several myths concerning Dumuzi’s tragic death, but the longest one involves him being taken by demons while sitting beneath a tree and then hung on a stake in the netherworld. A Mesopotamian cylinder seal dated between 2320 and 2150 B.C. shows a multi-horned Inanna welcoming Dumuzi back from the dead from the bottom of a tree. Sumerian statues of Inanna also look very much like the ancient “Venus figurines” like the “Venus of Willendorf,” earth mother figurines discovered throughout all of the Old World and dated as far back as 27,000 years ago.

Dumuzi Returns From the Dead

The Babylonians also celebrated the New Year Zagmuk festival of sowing barley in March/April, complete with the Christmas traditions of exchanging gifts, carnival processions, twelve-day feasts, and the staged re-enactment of the Enuma Elish creation myth. Each year as winter arrived, it was believed that the ancient seawater and freshwater monsters of chaos who gave birth to all the gods tried to slay their creations, and so in turn, the freshwater Apsu was tamed by the Promethean god Ea (or Enki) while it was the head god of the Babylonian pantheon, Ba’al Marduk, who battled and slew his primordeal wife Tiamat, before fashioning her corpse into the known world. Tiamat, who in Sumerian myths was Nammu, the great mother of both the universe and humankind, is probably another incarnation of the primordeal “Venus” earth mother. Thus, the Babylonian creation myth apparently represents the replacement of the far more ancient matrimonial religion with that of the patriarchal storm god cult.

The king of Babylon acted out the part of Marduk in the ceremonial New Years play. On the 10th day of the ceremony, he would enact the Sacred Marriage rite with his spouse or a celebate high priestess. In some versions of the story, Marduk is killed by Tiamat and then saved by his son Nabu, the god of writing, so in the enactment of the ritual, the king’s life was to be forfeited as well. However, a prisoner was usually used as a scapegoat for the king, and just to make it fair, a different prisoner was set free under some twisted sense of “balance.” Philo tells of a similar story of a madman named “Carabbas” dressed up and hailed as a mock king, and it is this story combined with the ancient myth of the sacrificed king that inspired the story of Pontius Pilate releasing Barabbas because of a non-existent Jewish custom of releasing a prisoner that the Romans would certainly never had honored even if it did exist. The tradition of the “mock king” holds parallels with some of the other cultural Christmas traditions as it follows the same themes as the dropping rank in Saturnalia and the five-day rule of the Mir-Norowzi. Even in late medieval England, St. Nicholas’ Day parishes held Yuletide “boy bishop” celebrations in which young men performed the functions of priests and bishops and were allowed to boss around their elders.

The myth of Hodr blindly slaying Baldr is mirrored in the apocryphal Book of Jasher in which the antediluvian king Lamech blindly shoots Cain with an arrow by the malevolent direction of his son Tubal-Cain, angering Lamech enough so that he then turned and killed his son in frustration as well. The story of Cain and Abel itself is based on an earlier Sumerian myth about two brothers, Summer and Winter, contending which of their sacrifices was more appealing to their father Enlil, and like the story of Cain (“Metal Smith”) and Abel (a possible pun on “Herdsman”), one is a farmer and one a shepherd, highlighting the ancient conflict between city farmers and nomadic shepherds. Just as Cain represented the city farmer and Abel the shepherd, Tubal-Cain is said in Genesis to have forged the first tools in bronze and iron while his brother Jubal was the father of the harp and flute for the “jubilee.” Just as Romulus slew Remus, Cain killed his brother Abel and was then banished to the land of Nod (“wandering”) and built the first city Enoch, which in Mesopotamia was Eridu. Later Kassite myth said that the first priest of Eridu, Adapa, was taken up to heaven where he met Dumuzi and Gizzida (“Good Tree,” Dumuzi’s double from the city of Lagash) playing St. Peter at the Pearly Gates, after which Adapa, on the advice of the wise God Enki playing the role of the snake in the Garden of Eden, denied the sky god Anu’s offer of the bread and water of eternal life, mirroring the Biblical interpretation of the Fall of Man and the story of the Biblical Enoch being taken up into heaven.

The second Sumerian capital city to take hold in ancient Sumer was Bad-Tibira (“The Fortress of Metal Smiths”), a natural identification for Tubal-Cain (“Bringer of Metal Smithery”), and the third king to rule the city was none other than Dumuzi the Shepherd. Another Dumuzi, called “the Fisherman,” ruled Uruk right before the famous king Gilgamesh. Since this Dumuzi captured the king to a rival dynasty in Kish that Gilgamesh was also in conflict with, it may be reasonable to link the fisherman Dumuzi with the tragic figure of Enkidu, who in Sumerian myth is blindly sent to the underworld by Gilgamesh only to be trapped there for not heeding Gilgamesh’s warnings. The Epic of Gilgamesh later absolves Gilgamesh of any guilt by placing the blame on Ishtar, just as Inanna is said to have been regretfully responsible for Dumuzi’s death in other versions of the Dumuzi myth. In yet another version, Dumuzi’s sister, Geshtinanna takes vengence on the storm goddess who killed Dumuzi, just as Ba’al Hadad’s sister/lover Anat takes revenge on the underworld god Mot for slaying her brother in a later Canaanite myth. In the Coptic Gospel of Judas, Egyptian Gnostics also rewrote the Passion story so that Judas betrayal of Jesus was a necessary part of some deeper cosmic mystery.

At the heart of this world myth lies the complimentary forces of good and evil, king and slave, and sacrifice and betrayal. The Persian historian and mythologist Mehrdad Bahar argued that the figure of the Haji Firuz is derived from ceremonies and legends connected to the Epic of Prince Siavash, which in turn derive from the ancient myths of Dumuzi, with the blackened face of the Hajji Firuz reaching back into the ancient symbolism of the vegetation god returning from the world of the dead, while his red clothing symbolized Siavash’s blood and the return of the sacrificed deity. His joviality, as with the Biblical Jubal, is the jubilation of Spring’s rebirth. The mothers of Baldr and Achilles, “the woman clothed in sun” in Revelation, and the Athena-like goddess of wisdom spoken of in the Toledot Yeshu all represent the same overarching theme of a protective mother or sister goddess watching over her Savior son/lover, who always dies tragically but is then reborn, whether it be Dumuzi, Tammuz, Adonis, Attis, Osiris, Dionysus, Baldr, or Jesus.

Keynes vs. Hayek

“These days, you constantly see articles that make it seem as if there was a great debate in the 1930s between Keynes and Hayek, and that this debate has continued through the generations. As Warsh says, nothing like this happened. Hayek essentially made a fool of himself early in the Great Depression, and his ideas vanished from the professional discussion.

So why is his name invoked so much now? Because The Road to Serfdom struck a political chord with the American right, which adopted Hayek as a sort of mascot — and retroactively inflated his role as an economic thinker. Warsh is even crueler about this than I would have been; he compares Hayek (or rather the “Hayek” invented by his admirers) to Rosie Ruiz, who claimed to have won the marathon, but actually took the subway to the finish line.” –Paul Krugman

Milton Friedman would probably be a better choice for the right-wing equivalent of Keynes, but he more-or-less added on to Keynes rather than completely opposed him (“In one sense, we are all Keynesians now; in another, nobody is any longer a Keynesian”). But now that the far right is embracing economic policies that are over 40 years old, they have to go further back and find someone who completely opposed him.

[youtube]http://www.youtube.com/watch?v=d0nERTFo-Sk[/youtube]

[youtube]http://www.youtube.com/watch?v=GTQnarzmTOc&feature=relmfu[/youtube]

First By Inflation, Then By Deflation

“If thou lend money to any of my people that is poor by thee, thou shalt not be to him as an usurer, neither shalt thou lay upon him usury.”
–Exodus 22:25

“At the end of every seven years you must cancel debts.”
–Deuteronomy 15:1

“If he has exacted usury or taken increase— Shall he then live? He shall not live! If he has done any of these abominations, He shall surely die; His blood shall be upon him.”
–Ezekiel 18:13

“If you have money, do not lend it at interest, but give to one for whom you will not get it back.”
–Thomas 95

“If you lend to those from whom you expect repayment, what credit is that to you? Even sinners lend to sinners to receive as much in gain.”
–Luke 6:34

“It is easier for a camel to go through the eye of a needle than for a rich man to enter the kingdom of God.”
–Mark 10:25

“The system of banking we have both equally and ever reprobated. I contemplate it as a blot left in all our constitutions, which, if not covered, will end in their destruction, which is already hit by the gamblers in corruption, and is sweeping away in its progress the fortunes and morals of our citizens. Funding I consider as limited, rightfully, to a redemption of the debt within the lives of a majority of the generation contracting it; every generation coming equally, by the laws of the Creator of the world, to the free possession of the earth he made for their subsistence, unincumbered by their predecessors, who, like them, were but tenants for life.”
–Thomas Jefferson

“Banks have done more injury to the religion, morality, tranquility, prosperity, and even wealth of the nation than they can have done or ever will do good.”
–John Adams

“History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control over governments by controlling the money and its issuance.”
–James Madison

“The bold effort the present [Second National] bank had made to control government, the distress it has wantonly produced… are but premonitions of the fate that awaits the American people should they be deluded into a perpetuation of this institution or the establishment of another like it.”
–Andrew Jackson

“I killed the bank.”
–Andrew Jackson when asked about his greatest accomplishment

“People who will not turn a shovelful of dirt nor contribute a pound of material will collect more money from the United States than will the people who supply the material and do the work…. It is a terrible situation when the Government, to insure the National Wealth, must go in debt and submit to ruinous interest charges at the hands of men who control the fictitious value of gold. Interest is the invention of Satan.”
–Thomas Edison

“I am more than ever convinced of the dangers to which the free and unbiased exercise of political opinion — the only sure foundation and safeguard of republican government — would be exposed by any further increase of the already overgrown influence of corporate authorities.”
–Martin Van Buren

“I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country; corporations have been enthroned, an era of corruption in High Places will follow, and the Money Power of the Country will endeavor to prolong its reign by working upon the prejudices of the People, until the wealth is aggregated in a few hands, and the Republic is destroyed. I feel at this moment more anxiety for the safety of my country than ever before, even in the midst of war.”
–Abraham Lincoln, after the passing of the National Bank Act

“Whoever controls the volume of money in any country is absolute master of all industry and commerce… and when you realize that the entire system is so easily controlled, one way or another, by a few powerful men at the top, you will not have to told how periods of inflation and depression originate.” –James Garfield

“If, as I said, any persons are to make good deficiencies to the public creditor, besides the public at large, they must be those who managed the agreement. Why therefore are not the estates of all the comptrollers-general confiscated? Why not those of the long succession of ministers, financiers, and bankers who have been enriched whilst the nation was impoverished by their dealings and their counsels?” –Edmund Burke

Today: “83 percent of all U.S. stocks are in the hands of 1 percent of the people. 61 percent of Americans ‘always or usually’ live paycheck to paycheck, which was up from 49 percent in 2008 and 43 percent in 2007. 66% of the income growth between 2001 and 2007 went to the top 1% of all Americans… Only the top 5 percent of U.S. households have earned enough additional income to match the rise in housing costs since 1975. For the first time in U.S. history, banks own a greater share of residential housing net worth in the United States than all individual Americans put together. In 1950, the ratio of the average executive’s paycheck to the average worker’s paycheck was about 30 to 1. Since the year 2000, that ratio has exploded to between 300 to 500 to one. As of 2007, the bottom 80 percent of American households held about 7% of the liquid financial assets. The bottom 50 percent of income earners in the United States now collectively own less than 1 percent of the nation’s wealth. Average Wall Street bonuses for 2009 were up 17 percent when compared with 2008. In the United States, the average federal worker now earns 60% MORE than the average worker in the private sector. The top 1% of U.S. households own nearly twice as much of America’s corporate wealth as they did just 15 years ago….. Despite the financial crisis, the number of millionaires in the United States rose a whopping 16 percent to 7.8 million in 2009. Approximately 21 percent of all children in the United States are living below the poverty line in 2010 – the highest rate in 20 years. The top 10% of Americans now earn around 50% of our national income.”
–Michael Snyder, Business Insider

“I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.”
–Thomas Jefferson

“…First by Inflation….”

“Indeed, Clinton gave a speech on March 15, 2007 to the National Community Reinvestment Coalition in which she said “the alarm bell about the subprime home market has largely gone unnoticed by the (Bush) administration because they keep arguing we have to give trillions of dollars of tax cuts for the wealthy”…. The evidence shows both Obama and Clinton were talking about various aspects of the issue as early as 2006, before it had ripened into a crisis.
Politifact.com

“Despite the ongoing adjustments in the housing sector, overall economic prospects for households remain good. Household finances appear generally solid, and delinquency rates on most types of consumer loans and residential mortgages remain low.”
–Ben Bernenke, Libertarian Republican and Greenspan acolyte, February, 2007

“I was aware that the loosening of mortgage credit terms for subprime borrowers increased financial risk. But I believed then, as now, that the benefits of broadened home ownership are worth the risk.”
–Alan Greenspan, Chairman of the Fed from 1987-2006, in September 2007

Predatory lending aimed at racially segregated minority neighborhoods led to mass foreclosures that fueled the U.S. housing crisis, according to a new study published in the American Sociological Review.”
Reuters

“…Then by Deflation…”

“House Budget Committee Chairman Paul Ryan is scheduled today to release a plan that would cut more than $6 trillion from President Barack Obama’s budget over 10 years, phase out traditional Medicare and call for a revamp of the tax code. ”
Bloomberg News

“Rep. Paul Ryan’s budget proposal cuts ‘nothing’ from Medicare, Social Security or defense in the next two to three years, and “in three years, he does not cut one dime from the debt.”
Politifact, quoting David Stockman, Former Reagan Budget Director

“In a speech in February 2004, Greenspan suggested that more homeowners should consider taking out Adjustable Rate Mortgages (ARMs) where the interest rate adjusts itself to the current interest in the market. The fed own funds rate was at a then all-time-low of 1%. A few months after his recommendation, Greenspan began raising interest rates, in a series of rate hikes that would bring the funds rate to 5.25% about two years later. A triggering factor in the 2007 subprime mortgage financial crisis is believed to be the many subprime ARMs that reset at much higher interest rates than what the borrower paid during the first few years of the mortgage.
Wikipedia.org on Greenspan

“For the fact is that the Obama stimulus — which itself was almost 40 percent tax cuts — was far too cautious to turn the economy around. And that’s not 20-20 hindsight: many economists, myself included, warned from the beginning that the plan was grossly inadequate. Put it this way: A policy under which government employment actually fell, under which government spending on goods and services grew more slowly than during the Bush years, hardly constitutes a test of Keynesian economics. Now, maybe it wasn’t possible for President Obama to get more in the face of Congressional skepticism about government. But even if that’s true, it only demonstrates the continuing hold of a failed doctrine over our politics. It’s also worth pointing out that everything the right said about why Obamanomics would fail was wrong. For two years we’ve been warned that government borrowing would send interest rates sky-high; in fact, rates have fluctuated with optimism or pessimism about recovery, but stayed consistently low by historical standards. For two years we’ve been warned that inflation, even hyperinflation, was just around the corner; instead, disinflation has continued, with core inflation — which excludes volatile food and energy prices — now at a half-century low. The free-market fundamentalists have been as wrong about events abroad as they have about events in America — and suffered equally few consequences. “Ireland,” declared George Osborne in 2006, “stands as a shining example of the art of the possible in long-term economic policymaking.” Whoops. But Mr. Osborne is now Britain’s top economic official. And in his new position, he’s setting out to emulate the austerity policies Ireland implemented after its bubble burst. After all, conservatives on both sides of the Atlantic spent much of the past year hailing Irish austerity as a resounding success. “The Irish approach worked in 1987-89 — and it’s working now,” declared Alan Reynolds of the Cato Institute last June. Whoops, again. But such failures don’t seem to matter. To borrow the title of a recent book by the Australian economist John Quiggin on doctrines that the crisis should have killed but didn’t, we’re still — perhaps more than ever — ruled by ‘zombie economics.’ Why?”
Paul Krugman

“…First by Inflation…”

“In Washington, the view is that the banks are to be regulated, and my view is that Washington and the regulators are there to serve the banks,”
–Spencer Bachus, Republican Chairman of the House Committee on Financial Services and TARP negotiator, December 2010

It is plain hubris to think that this government, with its $14 trillion dollar debt, annual deficits, and wasteful-spending, is worthy of this plenipotentiary oversight,”
-Michelle Bachmann, January 2011, on her bill to repeal the financial reform bill

The less we fund those [bank regulatory] agencies, the better America will be. I think anything we can do to slow down, deter or impede their ability to engage in this oppressive overregulation, which is freezing up our economy, would be good for our country.”
-Mitch McConnell, June 2011

Well, it is a check that this public is looking for on this runaway agenda of this administration. They don’t want to see any more spending, especially if it promotes policies that kill jobs. That’s what you’ve got, both with the Obamacare bill and the Dodd-Frank bill.”
–Eric Cantor, 2011

“The House Appropriations Committee financial services subcommittee on Thursday approved its 2012 appropriations bill, which curbs the Consumer Financial Protection Bureau (CFPB) created by the Dodd-Frank financial reform law.”
The Hill.com

“Last week, reports Shahien Nasiripour of The Huffington Post, all four Republicans on the commission voted to exclude the following terms from the report: “deregulation,” “shadow banking,” “interconnection,” and, yes, “Wall Street.” When Democratic members refused to go along with this insistence that the story of Hamlet be told without the prince, the Republicans went ahead and issued their own report, which did, indeed, avoid using any of the banned terms.That report is all of nine pages long, with few facts and hardly any numbers. Beyond that, it tells a story that has been widely and repeatedly debunked — without responding at all to the debunkers.In the world according to the G.O.P. commissioners, it’s all the fault of government do-gooders, who used various levers — especially Fannie Mae and Freddie Mac, the government-sponsored loan-guarantee agencies — to promote loans to low-income borrowers. Wall Street — I mean, the private sector — erred only to the extent that it got suckered into going along with this government-created bubble. It’s hard to overstate how wrongheaded all of this is. For one thing, as I’ve already noted, the housing bubble was international — and Fannie and Freddie weren’t guaranteeing mortgages in Latvia. Nor were they guaranteeing loans in commercial real estate, which also experienced a huge bubble. Beyond that, the timing shows that private players weren’t suckered into a government-created bubble. It was the other way around. During the peak years of housing inflation, Fannie and Freddie were pushed to the sidelines; they only got into dubious lending late in the game, as they tried to regain market share.”
Paul Krugman

“…Then by Deflation…”

“In addition to acknowledging that seniors, disabled and elderly people would be hit with much higher out-of-pocket health care costs, the CBO finds that by the end of the 10-year budget window [under Paul Ryan’s plan], public debt will actually be higher than it would be if the GOP just did nothing.”
Talking Points Memo

GOP presidential candidate Tim Pawlenty recently called for $2 trillion in tax cuts for individuals and businesses in the next decade, as well as two to three times less federal spending – cutting a total of $8 trillion. But on Tuesday, Pawlenty expressed his foreign policy plans to remain involved in the Middle East – to “seize” the opportunity “amid the turmoil of the Arab Spring” and to “help promote freedom and democracy.” The GOP candidate said America should stop “leading from behind” and be more active in regions like Libya, Egypt and even Saudi Arabia.”
–Nicole Glass, FrumForum.com

The $137 million deficit in the budget year ending June 30 represents about 0.456 percent of the $30 billion state budget, or less than half of 1 percent. The projected $3.6 billion deficit for the next two-year budget is more serious: about 12 percent of the overall budget…. In unveiling his two-year budget, Walker cut aid to local schools and government by about $1 billion. But the proposal, which now goes to the Legislature, included new spending in some areas, including adding $1 million in raises for prosecutors, $993,800 for additional public defenders and $1.04 million to investigate Internet crimes against children. On the opposite side of the ledger, the budget reduced revenue by some $140 million through a variety of tax cuts, including ones aimed at businesses and individuals with Health Savings Accounts.”
Politifact.com

“…First by Inflation…”

“As Timothy Noah of Slate noted in an excellent series on inequality, the United States now arguably has a more unequal distribution of wealth than traditional banana republics like Nicaragua, Venezuela and Guyana…. The richest 0.1 percent of taxpayers would get a tax cut of $61,000 from President Obama. They would get $370,000 from Republicans, according to the nonpartisan Tax Policy Center. And that provides only a modest economic stimulus, because the rich are less likely to spend their tax savings. ”
New York Times

“After the worst crisis since the Great Depression, President Obama has unleashed an unusual force to regulate the financial system: a bunch of empty seats…. The Obama administration put up Peter A. Diamond for a position on the Federal Reserve board. Winning a little something called the Nobel Prize [4] hasn’t helped him with confirmation, however. Sen. Richard Shelby, the powerful Alabama Republican and ranking member of the banking committee, is standing in his way. The senator also quashed the nomination of Joseph A. Smith Jr. to head the Federal Housing Finance Agency. But much of the blame for this situation lies with the Obama administration. It’s almost as if the president and his staff have thrown up their hands. The administration has had trouble finding good candidates who are willing to go through the vetting process and has shied away from fights. It also hasn’t seeded the ground or supported the nominations it has made, people complain.”
ProPublica.org

“Schneiderman’s probe, news of which came out yesterday in this piece by Morgenson, reportedly targets the banks’ mortgage securitization process during the bubble years. Morgenson reported that Schneiderman is focused on at least three companies: Morgan Stanley, Bank of America, and old friend Goldman, Sachs. This investigation has the potential to be a Mother of All Nightmares situation for the banks for a couple of reasons. For one thing, the decision to go after the securitization process is a total prosecutorial bullseye. This is the ugly heart of the wide-scale fraud scheme of the bubble era. Again, the business model during this time was a giant bait-and-switch scam. Sleazy lenders like Countrywide and New Century first created huge masses of bad loans, committing every conceivable kind of fraud to get people into loans (from doctoring income statements with white-out to phonying FICO scores to engineering fake appraisals). They then moved the bad loans quickly to the big banks, which pooled them and chopped them up (this is the “securitization” process), sprinkled hocus-pocus math on them, and then sold them to suckers around the world as AAA-rated securities…..The reason this is such a potentially deadly investigation for the banks is that they seemed to be so close to getting away scot free. There is another investigation into the banks’ mortgage abuses by the states’ Attorneys General, led by Iowa AG Tom Miller, that was rumored to be headed toward a settlement, despite the fact that nothing like a complete investigation has been done. The expectation for some time has been that the banks would eventually have to pay a significant, but eminently survivable, settlement for abuses during the bubble era. Although the Miller probe was focused on practices like robo-signing and other such documentation abuses, it could theoretically have covered securitization as well. But if the AGs were to sign off on a friendly global settlement for mortgage abuses prematurely, it would be like a DA offering a millionaire murderer a 2-year plea bargain before the cops even had a chance to interview all the eyewitnesses. It would be a blatantly political arrangement. Such a desire to get some kind of deal done and sweep the mortgage mess under the rug once and for all seems almost universal among high-ranking politicians, and particularly in the Obama administration, which has acted throughout like it wants more than anything to simply get all of this over with and put in the past.”
Matt Taibbi

“Schneiderman, a Democrat who rode to office by pointing out Wall Street’s misdeeds, requested documents earlier this year from Bank of America, the largest lender and mortgage servicer, Goldman Sachs and Morgan Stanley regarding their mortgage operations…. Schneiderman’s inquiry also raises questions about the speed the Obama administration and a coalition of state attorneys general and bank regulators are moving towards a settlement agreement to resolve claims of widespread foreclosure abuse. The states’ top cops and representatives of the Department of Justice, Federal Trade Commission, Department of Housing and Urban Development and the Treasury Department are pushing the nation’s largest mortgage companies to pay about $20 billion in a deal to end the months-long probes into shoddy and possibly illegal practices employed by Bank of America, JPMorgan Chase, Wells Fargo, Citigroup and Ally Financial.”
Huffington Post

Afghan officials said on Thursday that they have arrested two former executives involved in the collapse of Kabul Bank.”
New York Times

“A bitter cynic might suggest that such prosecutions [in America] have not happened because both political parties are desperately competing for Wall Street cash for the 2012 election, and nothing would doom the incumbent party’s chances more than holding Wall Street royalty accountable, along with the fact that the top levels of government are suffused with former bank officials and lobbyists– but everyone knows that American justice isn’t politicized that way, so that can’t be it (just like everyone knows that political considerations played no role whatsoever in the presidential shield of immunity lavished on high-level Bush officials).”
Glenn Greenwald

“…Then By Deflation…”

I think we’re going through those difficult economic times for a purpose, to bring us back to those Biblical principles of you know, you don’t spend all the money. [In the parable of Joseph and the “Good Pharaoh,”] You work hard for those six [read: seven] years and you put up that seventh year in the warehouse to take you through the hard times [harder times?]. And not spending all of our money. Not asking for Pharaoh to give everything to everybody and to take care of folks because at the end of the day, it’s slavery. We become slaves to government.
–Rick Perry, confusing the “Good Pharaoh” in Genesis with the “Bad Pharaoh” in Exodus

“[Joseph said:] Let Pharaoh appoint commissioners over the land to take a fifth of the harvest of Egypt [in taxes] during the seven years of abundance. They should collect all the food of these good years that are coming and store up the grain under the authority of Pharaoh, to be kept in the cities for food. This food should be held in reserve for the country, to be used during the seven years of famine that will come upon Egypt, so that the country may not be ruined by the famine.”
–Genesis 41:34-36

“It follows that the level of debt matters only if the distribution of net worth matters, if highly indebted players face different constraints from players with low debt. And this means that all debt isn’t created equal – which is why borrowing by some actors now can help cure problems created by excess borrowing by other actors in the past.”
–Paul Krugman

“The Democrats’ stimulus raised economic growth by as much as 4.5 percent in the last quarter and may have increased the number of people with jobs by more than 3 million, according to a Congressional Budget Office (CBO) report released Tuesday.”
The Hill.com

“…First by Inflation…”

“The Panic of 1907, also known as the 1907 Bankers’ Panic, was a financial crisis that occurred in the United States when the New York Stock Exchange fell close to 50% from its peak the previous year. Panic occurred, as this was during a time of economic recession, and there were numerous runs on banks and trust companies. The 1907 panic eventually spread throughout the nation when many state and local banks and businesses entered into bankruptcy. Primary causes of the run include a retraction of market liquidity by a number of New York City banks and a loss of confidence among depositors, exacerbated by unregulated side bets at bucket shops…. Production fell by 11%, imports by 26%, while unemployment rose to 8% from under 3%. Immigration dropped to 750,000 people in 1909, from 1.2 million two years earlier.”
Wikipedia

“Imagine the situation back in what ev-psych types call the Ancestral Adaptive Environment. Suppose that two tribes–the Clan of the Cave Bear and its neighbor, the Clan of the Cave Bull–live in close proximity but follow different hunting strategies. The Cave Bears tend to hunt rabbits–a safe strategy, since you can be pretty sure of finding a rabbit every day, but one with a limited upside, since a rabbit is only a rabbit. The Cave Bulls, on the other hand, go after mammoths–risky, since you never know when or if you’ll find one, but potentially very rewarding, since one felled mammoth provides a yield of, well, elephantine proportions. Now suppose that for a year or two the Cave Bulls have been doing very well, making a killing practically every week. After a while, the natural instinct of the Cave Bears is to feel jealous, and to try to share in the good fortune by starting to act like Cave Bulls themselves. In the ancestral environment, that instinct was entirely appropriate: The kinds of events that would produce a good run of mammoths–favorable weather producing a lush crop of grass, migration patterns bringing large numbers of beasts into the district–tended to be persistent, so it was a sound idea to emulate whatever strategy had worked in the recent past. But transplant our tribes into the world of modern finance, and those instincts aren’t appropriate at all. Efficient-markets theory tells us that all the available information about a company is supposed to be already built into its current stock price, so that any future movement is inherently unpredictable. Rational investors, by this logic, should treat bygones as bygones: The fact that your neighbor made a lot of money in stocks last year while you stayed in cash is no reason to get into stocks now. But suppose that, for whatever reason, the market goes up month after month; your MBA-honed intellect may say, “Gosh, those P/Es look pretty unreasonable,” but your prehistoric programming is shrieking, “Me want mammoth meat!””
Paul Krugman on Tech Bubble in 1998, before it crashed

Of course, some people still deny that there’s a housing bubble. Let me explain how we know that they’re wrong. One piece of evidence is the sense of frenzy about real estate, which irresistibly brings to mind the stock frenzy of 1999. Even some of the players are the same. The [Conservative/Free Enterprise] authors of the 1999 best seller “Dow 36,000″ are now among the most vocal proponents of the view that there is no housing bubble.”
Paul Krugman, August, 2005

“The Hamilton students sampled the predictions of 26 individuals who wrote columns… and evaluated the accuracy of 472 predictions…. Even when the students eliminated political predictions and looked only at predictions for the economy and social issues, they found that liberals still do better than conservatives at prediction. After [the winner] Krugman, the most accurate pundits were Maureen Dowd of The New York Times, former Pennsylvania Governor Ed Rendell, U.S. Senator Chuck Schumer (D-NY), and former House Speaker Nancy Pelosi – all Democrats and/or liberals. Also landing in the “Good” category, however, were conservative columnists Kathleen Parker and David Brooks, along with Bush Administration Treasury Secretary Hank Paulson. Left-leaning columnist Eugene Robinson of The Washington Post rounded out the “good” list. Those scoring lowest – “The Ugly” – with negative tallies were conservative columnist Cal Thomas; U.S. Senator Lindsey Graham (R-SC); U.S. Senator Carl Levin (D-MI)[a pro-military Democrat]; U.S. Senator Joe Lieberman, a McCain supporter and Democrat-turned-Independent from Connecticut; Sam Donaldson of ABC; and conservative columnist George Will.”
ScienceDaily.com

“…Then by Deflation…”

“To repeal the act creating bank notes, or to restore to circulation the government issue of money will be to provide the people with money and will therefore seriously affect our individual profits as bankers and lenders…see your congressman at once and engage him to support our interest that we may control legislation.” -James Buel, American Bankers Association, 1877

“Statistics from the United Nations tell us that the bottom 40 percent of the population of the United States own less than 1 percent of the nation’s wealth. That is about 120 million people. If each and every one of these individuals “forced” the banks to give them mortgages and loans, and then failed to pay them back, the worst that could happen would be a total national loss of 1 percent of wealth… Also curious are numbers on who actually lost the most in this Great Recession. According to a study by a professor at the University of California, the average American household lost an astounding 36 percent of their total wealth. But the top 1 percent households lost only 11 percent. So the net result is that the wealth distribution is even more unequal than it was it was before the financial crisis. Maybe the top 1 percent should be thanking the poor black folks for “causing” the financial meltdown.
InformationClearinghouse.com

“The rocket docket wasn’t created to investigate any of that. It exists to launder the crime and bury the evidence by speeding thousands of fraudulent and predatory loans to the ends of their life cycles, so that the houses attached to them can be sold again with clean paperwork. The judges, in fact, openly admit that their primary mission is not justice but speed. One Jacksonville judge, the Honorable A.C. Soud, even told a local newspaper that his goal is to resolve 25 cases per hour. Given the way the system is rigged, that means His Honor could well be throwing one ass on the street every 2.4 minutes.”
–Matt Taibbi, “Invasion of the Home Snatchers”

“I’ve called for a freeze on annual domestic spending over the next five years. This freeze would cut the deficit by more than $400 billion over the next decade, bringing this kind of spending — domestic [non-military and non-transportation] discretionary spending — to its lowest share of our economy since Dwight Eisenhower was president. Let me repeat that. Because of our budget, this share of spending will be at its lowest level since Dwight Eisenhower was president. That level of spending is lower than it was under the last three administrations, and it will be lower than it was under Ronald Reagan.
–Barack Obama, rated “Half True” by Politifact.com

Back during the campaign, Obama said he would create a $10 billion fund to help homeowners facing foreclosure. “Too many families are unable to refinance because no one will lend to them, and they are unable to sell their homes because the housing market has fallen,” reads as statement of policy from Obama’s 2008 campaign. “As president, Obama will fight to ensure more Americans can achieve and protect the dream of home ownership.” We named it one of our top promises, among the most significant campaign pledges Obama made. And soon after his election, Obama outdid the promise of $10 billion, creating a foreclosure prevention fund that totaled $75 billion, paid for with funds from the Troubled Asset Relief Program (TARP) and the government sponsored mortgage giants Fannie Mae and Freddie Mac. Officials said the fund could help 9 million homeowners. We gave Obama a Promise Kept. But as many months went by, the program never lived up to its promise. As of January 2011, the program had given permanent loan modifications to only about 500,000 homeowners. The news website ProPublica has extensively investigated the program and reached a number of dismal conclusions…. With millions of homeowners still struggling to stay in their homes, the Obama administration’s $75 billion foreclosure prevention program has been weakened, perhaps fatally, by lax oversight and a posture of cooperation—rather than enforcement—with the nation’s biggest banks,” ProPublica reported. “Those banks, Bank of America, Wells Fargo, JPMorgan Chase, and Citibank, service the majority of mortgages.”
Politifact.com

More on Ayn Rand and Alan Greenspan:

First appointed Federal Reserve chairman by President Ronald Reagan in August 1987, he was reappointed at successive four-year intervals until retiring on January 31, 2006 after the second-longest tenure in the position….. Although Greenspan was initially a logical positivist, he was converted to Rand’s philosophy of Objectivism by her associate Nathaniel Branden. He became one of the members of Rand’s inner circle, the Ayn Rand Collective, who read Atlas Shrugged while it was being written. During the 1950s and 1960s Greenspan was a proponent of Objectivism, writing articles for Objectivist newsletters and contributing several essays for Rand’s 1966 book Capitalism: the Unknown Ideal including an essay supporting the Gold Standard. Rand stood beside him at his 1974 swearing-in as Chair of the Council of Economic Advisors.”
Wikipedia.com on Alan Greenspan

“[The teachings of Satanism are] just Ayn Rand’s philosophy with ceremony and ritual added.”
-Antony LeVay, infamous founder of “The Church of Satan” and author of The Satanic Bible (1976)

“The [Satanic Bible‘s] “Nine Satanic Statements“, one of the Church of Satan’s central doctrines, is a paraphrase, again unacknowledged, of passages from Ayn Rand’s Atlas Shrugged.”
SatanismCentral.com

“When [Ayn Rand’s friend] finally refused to continue their relationship, Rand furiously expelled him from her ‘movement’ and then scuttled the ‘movement’ itself. That was, curiously, all for the better, since under her control the Objectivist movement was taking on more and more of the authoritarian or totalitarian overtones of the very ideologies it was supposedly opposing. In another incident, related by the columnist Samuel Francis, when Rand learned that the economist Murray Rothbard’s wife, Joey, was a devout Christian, she all but ordered that if Joey did not see the light and become an atheist in six months, Rothbard, who was an agnostic, must divorce her. Rothbard never had any intention of doing anything of the sort, and this estranged him from Rand, who found such “irrational” behavior intolerable…. She may be taken, nevertheless, for what she will continue to be: An inspiring advocate for the free market and for the creativity of the autonomous individual.”
–Kelley Ross, “Libertarian” academic

A heavy smoker who refused to believe that smoking causes cancer brings to mind those today who are equally certain there is no such thing as global warming. Unfortunately, Miss Rand was a fatal victim of lung cancer…. “Doctors cost a lot more money than books earn and she could be totally wiped out” without the aid of these two government programs. Ayn took the bail out even though Ayn “despised government interference and felt that people should and could live independently”… She didn’t feel that an individual should take help. But alas she did and said it was wrong for everyone else to do so. Apart from the strong implication that those who take the help are morally weak, it is also a philosophic point that such help dulls the will to work, to save and government assistance is said to dull the entrepreneurial spirit. In the end, Miss Rand was a hypocrite but she could never be faulted for failing to act in her own self-interest.”
Huffington Post

GOP leaders and conservative pundits have brought upon themselves a crisis of values. Many who for years have been the loudest voices invoking the language of faith and moral values are now praising the atheist philosopher Ayn Rand whose teachings stand in direct contradiction to the Bible. Rand advocates a law of selfishness over love and commands her followers to think only of themselves, not others. She said her followers had to choose between Jesus and her teachings.
American Values Network

“He said he had never understood his family until reading [about Ayn Rand]. It made him realize that they had mixed Rand’s strongly anti-government, unquestioningly pro-business, and individualistic worldview with biblical Christianity. Theologians call this “syncretism”—which George Barna calls America’s favorite religion.”
–Christianity Today, “Ayn Rand: Goddess of the Great Recession: Why Christians should be wary of the late pop philosopher and her disciples”

“When you vote for politicians who take from your back pocket to give to others, you think it’s compassionate, you think it’s caring? It’s not. It’s depriving the recipient of his own quest for self-interest. The brilliant writer and novelist, Ayn Rand, has written about this. Let me give you a couple quotes from Ayn Rand on this.”
–Rush Limbaugh, 2009

“Thanks very much for pamphlet. Am an admirer of Ayn Rand but hadn’t seen this study. ”
–Ronald Reagan

And yet……

“The Presidential election of 1976. I urge you, as emphatically as I can, not to support the candidacy of Ronald Reagan. I urge you not to work for or advocate his nomination, and not to vote for him. My reasons are as follows: Mr. Reagan is not a champion of capitalism, but a conservative in the worst sense of that word—i.e., an advocate of a mixed economy with government controls slanted in favor of business rather than labor (which, philosophically, is as untenable a position as one could choose—see Fred Kinnan in Atlas Shrugged, pp. 541-2). This description applies in various degrees to most Republican politicians, but most of them preserve some respect for the rights of the individual. Mr. Reagan does not: he opposes the right to abortion.”
–Ayn Rand, 1978

The threat to the future of capitalism is the fact that Reagan might fail so badly that he will become another ghost, like Herbert Hoover, to be invoked as an example of capitalism’s failure for another fifty years.”
–Ayn Rand, 1981

And yet…….

Ronald Reagan would have a very difficult, if not impossible time being nominated in this atmosphere of the Republican party.
–Mike Huckabee

The Friesian Correspondence: Letter 4C: Democrats Believe Islamic Fundamentalism is “Fully Redeemed by Its Hatred of America”

C.S. Lewis
C.S. Lewis, author of Chronicles of Narnia and That Hideous Strength

This is the conclusion of the three-part letter I’m posting in reply to Kelley Ross’ essay, “That Hideous Strength: Satan is a Democrat, It is the Blue States that are Red, & The Evil Empire Strikes Back.”

>Democrats and labor unions, with obvious hostility, drive industries out of whole cities and States and then lament that “Capitalism” has failed to provide employment. No. A good example is that the laissez faire Capitalism of 1906 delivered 1.7% unemployment, the very year that Upton Sinclair’s The Jungle portrayed hopeless hordes of the unemployed waiting for jobs at the meatpackers in Chicago. The real hopeless hordes of the unemployed are now in France, or Michigan, where socialism has reigned for decades.

And then one year later there was the Panic of 1907 when the stock market fell over 50%, the primary causes of which were a retraction of market liquidity by a number of New York City banks and a loss of confidence among depositors, exacerbated by unregulated side bets and speculation from “bucket shop” scams. As your own chart from “Historical Statistics and Analysis” points out, unemployment was at 8% by 1908. The more things change the more they stay the same.

While no one paid attention to Sinclair’s socialistic message in The Jungle, his realistic descriptions of animal feces being mixed in with meat products brought about the much needed Pure Food and Drug Act which regulated the meat market.

As of 2008, 12.4% of U.S. wage and salary workers were union members, down from 36% from the mid-1950s. The U.S. has the second lowest percentage of unionization of any developed democracy. Who’s the lowest? France.

> In 2008, Texas created more jobs than the whole rest of the United States put together. With no personal income tax, Texas is not famous for economically restrictive government. Thus, Texas grows, while Michigan, New York, and California shrink.

So because it has no personal income tax, Texas created more jobs than Alaska, Florida, Nevada, South Dakota, Washington and Wyoming put together…. even though those states also have no personal income tax. Nevada has the highest unemployment rate (14.4%) of all the states, including Michigan (13%). Florida (11.9%) is just under California (12.4%) and way above New York (8.3%). Also, 4 out of 10 of the states with the worst unemployment are red states, 4 out of 10 of the states with the least unemployment are blue states, and 7 of the top 10 wealthiest states are blue, excluding oil-taxing Alaska (#6), Virginia (#7) and Utah (#8), and including ultra-liberal Massachusetts (#9). All 10 of the poorest states are red states.

And this isn’t because of income redistribution. Despite Republicans being the loudest complainers about government spending, data going back 20 years shows that red states have actually been taking money away from blue states. Shankar Vedantam of Slate reports that, “The 28 states where George W. Bush won more than 50 percent of the vote in 2004 received an average of $1.32 for every dollar contributed. The 19 states where Bush received less than 50 percent of the vote collected 93 cents on the dollar.”

So what’s with Texas? Well first off, despite all those job creations, unemployment is still about the same as New York, below the national average, so the greater job-creation has more to do with the long-running trend of Texas always having a faster-growing employment and population. However, Texas is a lot better off this recession than the last one because of a combination of factors, including relaxed zoning codes and a larger area of land which kept appreciation and speculation down. Texas is also the home of large energy companies like ExxonMobil, which were largely unaffected by the crisis. Wind power created over 10,000 jobs and has attracted some foreign companies like Shell, Vestas, Iberdrola.

And although it may not be famous for it, Texas had comparatively strong regulations restricting consumers from using home-equity lines of credit to increase borrowing over 80% of their home value. This was probably because half the S&L’s from the 1989 crisis, which was brought on by a “surprisingly familiar set of precursors,” came from that state alone yet the entire country was forced to bail them out. Twenty years later, Governor Rick Perry is trying to court the Texas secessionist movement with references to pre-Civil War Texas s[e]cession rights.

Despite all that, there’s still a huge problem with Texas. Like Ireland, [Texas,] Britain, and Germany [were] used by the [R]ight to prove that draconian cuts and austerity brought a successful economy in the face of the economic crisis, but all four have fallen drastically since. As it turns out, Texas was the state that depended the most on those very stimulus funds Perry criticized to plug nearly 97% of its shortfall for fiscal 2010, according to the National Conference of State Legislatures. Now that the stimulus money has run out, the deficit is expected to run as high as $25 billion over the next two years, putting them in the same category as California. Not wanting to raise taxes, Perry has proposed huge cuts [in education] despite the fact that Texas already ranks near the bottom in education spending per pupil, while leading the nation in the percentage of residents without health insurance.

> Now we hear that Union members (“goons”? “thugs”?) have been threatening and strong-arming citizens who show up at the public fora.

Assuming you are referring to the Glenn Beck video, The Wichita Eagle reported that the video of the alleged assault on Kenneth Gladney “show[s] a scuffle but is inconclusive as to what exactly happened.” Less ambiguous are the cases of Joe Miller having his bodyguards arrest a reporter for asking him questions and Rand Paul’s supporters dragging a liberal activist to the ground while one of his campaign coordinators pinned her down with his shoe, earning him a police summons (after which he said she owed him an apology). Then there were also the death threats, the brick thrown through the window, and the cut gas line following health care being passed, and Al Franken’s window being shot, possibly by a pellet gun, following his criticism of the New York Islamic cultural center protesters.

>Democrats simply cannot believe, or don’t care, that their promotion of socialism will evoke a genuine visceral and spontaneous reaction from Americans.

Conservatives certainly have visceral reactions when Republicans frame the term as some sort of post-Soviet conspiracy, but social security is the most popular government program ever created, and Republicans decided the best way to attack Obama’s health care reform is to get conservatives to chant “No socialized medicine! And don’t touch my Medicare!”

Polls show almost half of Americans believe Obama initiated TARP, with only a third knowing that it was Bush. Only 12% of Americans know that tax bills for 2009 were lower (the lowest in 60 years) and twice as many believe taxes went up, while 38% believe Obama is “doing many of the things that Hitler did,” and 24% think he may be the Anti-Christ.

>They are also absurdly and hypocritically shocked and outraged that people should portray Obama or the Democrats as Nazis or Fascists (“We can’t allow this incivil discourse!”), when we heard no such cautions for all the years that George W. Bush was portrayed as a Fascist, Nazi, or Adolf Hitler himself. The grotesque conceit seems be that, well, smearing Bush was true, while labeling Obama the same way is an intolerable misrepresentation, outside reasonable political speech!

Bush was not compared to Hitler until he pushed for the invasion of Iraq. While I criticize any American president being compared to Hitler, it’s common for any military aggressor to be compared to him these days. Obama, in contrast, was immediately characterized before he was even elected, not as Hitler, but a hippie Stalinist Muslim elitist Hitler, complete with “terrorist fist bump.” Then after conservatives started getting tired of those words, D’Souza added “anti-colonialist.”

Aside from that, there’s the “birthers,” composed of the 20% of Americans who are sure he was born in Kenya and another 22% of Americans who are unsure, all of which gets help from Hannity, Rush, Savage, Levin, Dobbs making an issue of Obama’s birth certificate despite the fact that it was actually John McCain who lacks an American birth certificate, having been born in the Panama Canal Zone.

>Democrats want us to think that only Republicans promote corporate welfare, but we have recently seen their participation in that form of corruption in the corporate bailouts of 2009 — and they have all but institutionalized corporate welfare for the corn lobby in subsidies and mandates for ethanol (e.g. the Archer Daniels Midland Company).

Most liberals agree that the corn lobby should not be subsidized and are the biggest protesters of high fructose corn syrup. Ethanol mandates are unpopular with both parties, and I agree that it should not be funded because it causes food shortages and increases carbon emissions. Most Democrats and Republicans believe the corporate bailouts were necessary, but it’s liberals who made the loudest condemnation of the failure to cap bonuses.

>The logical goal of Democrat politics would be to put all business under the control of the government, a goal now achieved with General Motors, and to render all citizens into helpless peons who receive all goods and favors from politicians. Political enemies thus can be immediately deprived of jobs, housing, medical care, etc., as in the Soviet Union.

No, putting businesses under the control of the government would have meant the far more successful plan of nationalizing the banks like Sweden did during their 1992 crisis. The taxpayer just lent the banks money so they could turn around and lend it to the tax payer who just bailed them out at a higher rate. It’s the classic corporate strategy of “privatize the profits, socialize the losses” going back to the closing of the Second National Bank.

Christina Corbin at FoxNews.com tried to defend the tea party by saying the idea that “Obama wants to keep Americans unemployed so that they become dependent on government-run programs,” along with the idea that Obama is a secret Muslim, are part of the “mistruths, exaggerations and conspiracy theories that make Tea Party leaders cringe.” But I guess to you that’s just further proof Fox News isn’t really right wing.

>If Barack Obama admitted that he wants a “single payer” government medical system, and that the “reform” of the Democrats is designed to drive insurance companies out of the medical insurance business, the debate over “reform” would be a lot clearer.

According to Politifact.com, “Obama’s statements on single-payer have changed a bit,” prompting them to rate the change a “Half Flip.”

Since at least 1987, polls have shown the majority of the public favor a single-payer system. Between 2003 to 2009, 17 opinion polls from multiple sources showed a simple majority of the public supports a single-payer system in the United States.

>On the other hand, ignorance, unfortunately, is now the stock-in-trade of American education, all levels — as the Democrats and the leftist allies of the Democrats have seized the educational institutions — from the worthless Schools of Education, to the accreditation agencies, to the professional societies (the Modern Language Association, the MLA, may be the worst), to the administrations and faculty of the schools themselves. The higher the education, the purer the Marxism and Leninism, although leftist anti-capitalism and anti-Americanism infuse all levels of education. One way this could happen is that most college students who go into education major in “education” rather than in any real disciplines. What they pick up otherwise is from the humanities, rather than the sciences, and they soon discover that courses, for instance, in English departments have little to do with literature and language and much to do, like Sociology and now History departments, with political propaganda.

Apparently it’s so infused that no one even notices it. I must be the only English major who studied Dante instead of Lenin. By the way, your B.A. is in history, languages and philosophy and your M.A. is in philosophy. Are those “real” disciplines? Because you appear to believe it makes you better at economics than economists and better at physics than physicists and climate scientists.

>As “tenured radicals” have come to dominate academia, the press, and the intelligentsia, a major conceit of leftist and Democrat politics is how smart they all are. In turn, the common theme of trendy humor and opinion is how stupid Republicans are, from Ronald Reagan to George W. Bush.

I believe the general Republican strategy has little to do with even pretending to be intelligent because it conflicts with their demonization of “elitist” intelligentsia, as you just demonstrated above. Bush seemed to dumb down his own speaking habits on purpose and take on the Reagan-esque cowboy image because people generally want to elect presidents they “want to have a beer with.”

A new study from the peer-reviewed scientific journal Social Psychology Quarterly, authored by a Libertarian, says there is a statistical correlation between high intelligence and liberalism, atheism, and male monogamy. Young adults who identify themselves as “very liberal” have an average IQ of 106 while those who identify themselves as “very conservative” have an average IQ of 95. A 2007 study in the journal Nature Neuroscience suggests liberal brains are more adept at processing new ideas. Stephen Hawking is in the Labour Party and it was Democratic representative Rush Holt who just recently beat IBM’s supercomputer Watson at Jeopardy.

>After the Democrats took Congress in 2006, however, the American public has had a good chance to see a lot of Democrat politicians in action. What seems obvious about the likes of Nancy Pelosi, Harry Reid, Barbara Boxer, or Barney Frank, then, is that they are just idiots.

Barney Frank is often called the “smartest guy in congress.” Jim Leach, the former Republican Congressman from Iowa who preceded Frank as committee chairman and worked with him for 30 years said “I think he’s probably Congress’s smartest member in sheer IQ.” He’s certainly a very quick-witted speaker with a verbose vocabulary and the ability to use effective references. Typically, when you call someone stupid, you give a stupid quote. Bush has dozens of “Bushisms.” No one, Republican or Democrat, has ever called him the smartest man in anything. I’d put my money on Barney Frank or even Pelosi beating Bush, Palin, Bachmann, or O’Donnell in an IQ test any day of the week.

>They make George W. Bush look like Albert Einstein. They will say anything just because they want it to be true, however absurd or incoherent it may be.

Albert Einstein was put on the FBI list for being an anti-McCarthy socialist (of course, MLK Jr. was put on the list too, and he’s now fraudulently called a conservative by revisionists). In his article, “Why Socialism?”, Einstein wrote, “The economic anarchy of capitalist society as it exists today is, in my opinion, the real source of the evil. We see before us a huge community of producers the members of which are unceasingly striving to deprive each other of the fruits of their collective labor—not by force, but on the whole in faithful compliance with legally established rules…. Private capital tends to become concentrated in few hands, partly because of competition among the capitalists, and partly because technological development and the increasing division of labor encourage the formation of larger units of production at the expense of smaller ones. The result of these developments is an oligarchy of private capital the enormous power of which cannot be effectively checked even by a democratically organized political society.” No doubt if Einstein was alive today you would be calling him an idiot.

Stephen Hawking considers global warming to be just as dangerous to the survival of mankind as nuclear weapons, but I guess he’s just an anti-science “Post-Copernican” who’s against “human progress and the betterment of human life on earth,” so you must be smarter than him too. After all, as you fully admit, science has nothing to do with what’s written in “journals like Nature, the National Science Foundation, or the Royal Society of Britain,” or indeed any and all science organizations and journals throughout the world!! No sources from any climate scientists or physicists are necessary for your claim that 2010 was the coldest in 100 years. We can just assume you know more than NASA, NOAA, and every other science organization on the planet that says 2010 tied for the hottest year ever recorded and that every decade has been hotter than the last. The world’s scientists are all just politically biased, even though the science literature never touches on which political solutions should be used, unlike you, who are unable to even write a review on Star Trek without basing its worth completely on the fiscal policies of today’s world that it presumes (Even if they do have replicators and holograms that can create anything and everything, the Federation are still fascists for not having a capitalistic trade system based on supply and demand!). How 97% of climate scientists reached a consensus based purely on a form of closet Communism that somehow causes the world’s glaciers to melt and the famed Northwest Passage to open up is unimportant: that’s just “Official Science,” not “Real Science,” which can only be decided by what you say it is.

But wait, when writing about Gordon Liddy, you said, “Liddy may be wrong about Global Warming, which may be affected by human activities.” I guess you were a closet Communist and “planet catastrophe and terrorist friend” when you wrote that. Then your article on Michael Crichton says Global Warming is unstoppable, but later you added a quote that says the world is cooling without changing any of the stuff that says its non-antrhopogenic warming. Talk about “incoherent.” Plus you complain that Arnold Schwarzenegger “suddenly became a Believer in Global Warming” (like he didn’t before?). So which is it? Is the world cooling or going through unstoppable warming? I guess in your world of doublethink, it’s the same thing as long as both arguments agree with closing off subsidies to clean energy (but not tax-dodging oil companies of course!). After all, as you’ve told me before, investing in clean energy would somehow kill more people than runaway global warming even though France somehow managed to get 80% of their energy from nuclear without anyone dying.

>They also had reason to hope that they could entangle him in the bogus Valerie Plame affair. Although the Special Prosecutor in the case, Patrick Fitzgerald, determined quite early that no laws had been broken, he continued his investigation anyway.

So if the Plame affair involved evidence being found of a connection between Saddam Hussein and uranium, and it was the Democrats who outed her for political reasons, you would still have been critical of the investigation?

>This may have started in 2000. The election was close, and the outcome would be determined by Florida, where the vote itself was very close. The strategy was adopted of successive recounts. With each recount more Republican votes could be disqualified and more Democratic votes “discovered.”

In Volusia county, Florida, a voting machine claimed those 412 voters had somehow given Bush 2,813 votes and in addition had given Gore a negative vote count of -16,022 votes. An internal memo from the Diebold company who created it said: “If you strip away the partisan rancor over the 2000 election, you are left with the undeniable fact that a presidential candidate conceded the election to his opponent based on [results from] a second card that mysteriously appears, subtracts 16,022 votes, then just as mysteriously disappears.”

Also, Bush lawyers specifically argued against counting methods that Bush personally adopted as governor.

A study cited by Factcheck.org notes that while Bush would have won with the limited recounts that both he and Gore asked for, a broad-based recount would have shown Gore winning from between 42 to 171 votes.

>As the Florida Supreme Court was going to allow endless recounting in the whole State, contrary to all State and Federal law, the United States Supreme Court stepped in and stopped the farce. The Democrats, having brazened out their own attempt to steal the election, then began screaming that the Republicans had stolen the election.

In 1997, G.W. Bush signed “HB 330” into law stating hand recounts were necessary following a close election in Texas. Having the federal supreme court overturn the state supreme court also goes against the typical conservative narrative that the states should be allowed to govern themselves, an especially important consideration given that Gore would have won had the election been based on the popular vote rather than [by state] electoral college. And if the justices who made that decision are so proud of what they did, why did they ban the court’s action from ever being used as a precedent for future elections? No doubt different measures would have to be taken if the exact situation happened again with the roles reversed.

The four justices who dissented against the federal court ruling wrote: “Counting every legally cast vote cannot constitute irreparable harm… Preventing the recount from being completed will inevitably cast a cloud on the legitimacy of the election.” The dissenting justices argued that stopping the recount was an “unwise” violation of “three venerable rules of judicial restraint,” that is, respecting the opinions of state supreme courts, cautiously exercising jurisdiction when “another branch of the Federal Government” has a large measure of responsibility to resolve the issue, and avoiding making peremptory conclusions on federal constitutional law prior to a full presentation on the issue. Judge Stevens, who was nominated by Ford, said, “Although we may never know with complete certainty the identity of the winner of this year’s Presidential election, the identity of the loser is perfectly clear. It is the Nation’s confidence in the judge as an impartial guardian of the rule of law.”

>Meanwhile, the Democrats have perfected their strategy and have now stolen two major elections. In 2004 the Republican Dino Rossi won the Governor’s race in Washington State by a small margin. The Democrats then began endless recounts, especially in urban districts with Democrat officials, until the Democrat, Christine Gregoire, moved ahead and could be proclaimed the winner.

The state Supreme Court decision allowed 732 ballots to be reconsidered in King County, a Democratic stronghold, because those ballots had been mistakenly thrown out because of problems scanning signatures into a computer. Most Republican pundits don’t even challenge recounts but instead make the unsubstantiated accusation of voter fraud, which in reality is very rare.

>The next case would be of greater national significance. In 2008, Minnesota Republican Senator Norm Coleman won his race by 725 votes. After eight months of recounts and challenges, Democrat comedian Al Franken was credited with a victory by 312 votes. Perhaps an all too typical Republican, Coleman, instead of appealing to Federal Courts, conceded defeat, as Richard Nixon had in 1960. The result was firm Democrat control of the United States Senate, enabling them to pass socialized medicine, or whatever else they want, and override all opposition.

Factcheck.org says: “Unlike many right-leaning blogs and commentators, Coleman makes no claim of partisan funny business by the five members of the Canvassing Board, which has only one clearly identified Democrat. Coleman’s lawyer once praised the panel’s makeup, in fact. Coleman’s appeal challenging the board’s certification, which a three-judge panel began hearing Jan. 26, lays out his theory: “Not every valid vote has been counted, and some have been counted twice.” Coleman raised several issues, among them: duplicate ballots, “missing” ballots, “improperly” rejected absentee ballots, and discrepancies in rulings made on ballots concerning voter intent. Factcheck wrote: “The burden is on Coleman to prove all these claims, and even if he wins on each point it’s not clear whether he would gain enough votes to change the outcome.” After a six-month legal battle in which he lost each of his contests, the Minnesota Supreme Court unanimously declared Franken the election winner.

>It is remarkable to me that people in a democracy would want to steal elections, but I have no doubt that the Democrats are willing to do this, as historically they often have. Sometimes self-righteousness and lust for power may not be enough to explain it. Or, since the most radical Democrats and their supporters are clearly Communists, it is clear that they have no respect for elections, majorities, legality, democracy, or anything else that would stand in their way. But I am also perfectly willing to consider the possibility that Supernatural Evil is involved, as in the N.I.C.E. (“National Institute for Coordinated Experiments”) institution of C.S. Lewis’s That Hideous Strength [1945]. Much of what the Democrats do looks like N.I.C.E., in both its rhetoric and its police state reality [note]. If I were a Christian, and if I thought that abortion or homosexuality were morally wrong, I think it would hard not be believe that Satan, as in Lewis’ novel, was behind Democrat politics. The mix of lies, seduction, death, sterility, and corruption seems Satanic in its combination of fair face and vicious substance, hedonism and rot.

This is rich considering your own misgivings about Christianity based on critical readings of the sayings attributed to Jesus in the gospels. In your [essay], “Why I Am Not a Christian”, the third reason you give for not being a Christian is the gospel injunction for the rich to give all their money to the poor in order to attain salvation because it implies that economics is a “zero-sum” game, which you yourself associate with Marxism. So you’re not a Christian because Christian teachings are too Marxist, but Democrats are Satanic for being too Marxist as well.

The condemnation of the rich is one of the strongest themes found in the gospels. Some Christians have tried to explain this away by claiming the “needle’s eye” for which the camel going through would be easier than for a rich man to enter heaven was actually a gate in Jerusalem. The proclamations against the rich have become so disassociated with conservative religious beliefs that Obama’s “spread the wealth around” comment has largely been connected with the pre-Marxist saying “to each according to his needs” without any acknowledgment that it originates from Acts 4:35, which describes the apostles disowning all possessions and holding all things common “according as he had need.”

As C.S. Lewis himself writes in Mere Christianity, a Christian society would [have] “no manufacture of silly luxuries and then of sillier advertisements to persuade us to buy them. There would be no ‘swank,’ no ‘side,” no putting on airs. To that extent a Christian society would now be what we now call Leftist…. We should feel that its economic life was very socialistic and, in that sense, ‘advanced’, but that its family life and its code of manners were rather old fashioned–perhaps even ceremonious and aristocratic.”

Ayn Rand, who has been so much an inspiration to not just Greenspan but Christians like Reagan, Armey, Delay, Lott, Limbaugh, Coulter, and George Will, mocked Christianity as “the best kindergarten of communism possible” and based her philosophy on the worship of selfishness that many Christians accuse all atheists of. Her influence on Greenspan’s political combination of government intervention-hating Libertarianism and government intervention-loving corporate socialism inspired Christianity Today to call her the “Goddess of the Great Recession.”

As to the “police state,” the only political controversies that can reasonably affiliated with that is the Drug War, started by Reagan and [] to this day supported by the Right and opposed by the Left, and the War on Terror, leading to some of the most massive Constitutional breaches to the right to a fair and speedy trial, supported by you, Obama loyalists, and all the Neo-Cons who are congratulating Obama for breaking his campaign promises so he can go even further than Bush in “keeping America safe.”

Satan, as portrayed in Revelation, is a symbol of Rome, associated with a seven-headed dragon representing the seven hills of Rome. The “Number of the Beast,” 666, is largely accepted as being numeric code for “Nero Caesar.” The gospels likewise hide sentiments against the Roman occupation behind allegories of demonic possession of a demonic horde “named Legion,” which inhabit a large number of swine symbolizing the Tenth Legion’s boar emblem and sending them to their deaths into the sea. And it’s the Neo-Cons of today who act most like Rome in defending the realpolitik of Middle Eastern occupations and alliances with corrupt dictators which in turn cause the insurgence of theocratic regimes like Iran’s Islamic Revolution and al-Qaida in Iraq, just as Rome’s occupations and alliance with King Herod brought about the brutal insurgence of Sicarii assassins, symbolized in the gospels by Judas “Iscariot.”

Classic liberals were most inspired by Cicero. Anti-war Libertarians identify themselves with Cato, as in the Cato Institute, whose motto is: “Individual liberty, Free Markets, and Peace.” Marx sympathized most with Spartacus. And the original godfather of neo-conservatism, Irving Kristol — father of Bill “Crystal Ball” Kristol — complained that conservatism “is so influenced by business culture and by business modes of thinking that it lacks any political imagination, which has always been, I have to say, a property of the Left…. What’s the point of being the greatest, most powerful nation in the world and not having an imperial role? It’s unheard of in human history.” Clearly, Kristol and the Neo-Cons are for Caesar.

Rome also partly inspired the “Evil Empire” in Star Wars which you reference in your sub-title, “The Evil Empire Strikes Back,” but George Lucas wrote Star Wars in 1971 in reaction to Nixon and the Vietnam War. Star Wars Episode III, chronicling the decay of the Republic into the Empire, was written with the Bush Administration in mind, with Darth Vader’s quote “If you’re not with me, you’re my enemy,” being an obvious jab at Bush’s “Either you are with us or with the terrorists.” Lucas himself said Star Wars is a wakeup call to Americans about the erosion of democratic freedoms under George W. Bush and identified Obama as a Jedi when testifying in front of the House Subcommittee on Telecommunications and the Internet. Dick Cheney even referred to himself as the “Darth Vader of the Bush Administration,” and commented that his wife believed the role “humanized him.” Lynn Cheney even presented Jon Stewart with a Darth Vader figurine on-air in a full embrace of the caricature.

So, added all together, you have completely reversed the symbolism for Christianity, Satan, C.S. Lewis, the Roman Empire, and Star Wars without any acknowledgment or irony.

>In August 2009, the London Telegraph reported that NICE “intends to slash by 95 percent the number of steroid injections, such as cortisone, given to people who suffer severe and chronic back pain. This is, of course, the kind of rationing and degradation of care that is characteristic of socialized medicine. Similar provisions in the Democrat’s 2009 health care “reform” bill are what led Sarah Palin to brilliantly dub the envisioned “end of life” services “death panels,” to the fury and indignation of the Democrats. NICE, whether in C.S. Lewis or in modern reality, is a “death panel.”

She went a lot f[u]rther than that. She said, “And who will suffer the most when they ration care? The sick, the elderly, and the disabled, of course. The America I know and love is not one in which my parents or my baby with Down Syndrome will have to stand in front of Obama’s ‘death panel’ so his bureaucrats can decide, based on a subjective judgment of their ‘level of productivity in society,’ whether they are worthy of health care. Such a system is downright evil.” Politifact.com rated it “pants on fire” and it later won their “Lie of the Year” award.

>Unfortunately, there is no modern politician with the wisdom of Jefferson, the wolves are among us, and the teeth and claws are in us. These are the Democrats, supposedly the heirs of Jefferson’s own Party. It is their own party.

Before you go off claiming Jefferson for the Republicans, Jefferson said:

“Men by their constitutions are naturally divided into two parties: 1. Those who fear and distrust the people, and wish to draw all powers from them into the hands of the higher classes. 2. Those who identify themselves with the people, have confidence in them, cherish and consider them as the most honest and safe, although not the most wise depositary of the public interests. In every country these two parties exist, and in every one where they are free to think, speak, and write, they will declare themselves. Call them therefore liberals and serviles, Jacobins and ultras, Whigs and Tories, Republicans and Federalists, aristocrats and democrats, or by whatever name you please, they are the same parties still and pursue the same object. The last one of aristocrats and democrats is the true one expressing the essence of all.” –Thomas Jefferson to H. Lee, 1824

Jefferson’s fear that national banks would draw most of the money away from the workers and traders and into the higher finance classes came to fruition immediately preceding the Great Depression, the Panic of 1907, the Savings and Loan Crisis of the Reagan era, and now the Housing Loan crisis of the Bush era. But it’s the Republicans who thwart attempts at financial reform all the while blaming the entire crisis on the government shifting blame entirely to two private companies with government support.

>Libertarians: Ideological crackpots, tilting at windmills, who nevertheless are the most sensible people around — an appalling circumstance.

So both major American political parties are so terrible that even the crackpots are better off than them, but you’re the one who has the most “optimistic” conception of this country full of Three Terrible Parties?

>Republicans: Who think that it is more important to attack Charles Darwin than to enforce the Constitution or stand for principles that will make the Democrats and the media call them names.

If only they stood more for your principles of doing nothing but lowering taxes and hating Democrats, then you could switch parties.

>Democrats: Who hate almost everything about America, including the very ideas of limited government, individual rights, private property, self-defense, free enterprise, free speech, etc. A history of slavery, sexism, and homophobia naturally discredits everything about America and its history — but these are only minor idiosyncrasies in Islâmic fundamentalism, which of course is fully redeemed by its hatred of America (and, well, Jews). Any Democrats who do not agree with attitudes like these, it is time for you to get out of that Party. If you don’t believe that the Party involves attitudes like these, it is time to get wised up.

Summaries tend to provide a short form of what is better expressed throughout the body of the argument, yet in 13,400 words you were unable to get around to explaining why “the party of Wicca” is somehow also the party of Islamic fundamentalism. This makes about as much sense as Newt Gingrich proclaiming Democrats will lead us to “secular atheist country, potentially one dominated by radical Islamists…” Isn’t it Dick Armey who promoted the interests of the People’s Mojahedin Organization of Iran? Isn’t it Obama who is shredding the Constitution in order to assassinate an American-born Islamic Fundamentalist?

Reading this article is actually quite sad. For many years I was a huge fan of your site for its historical pages, and I still consider your article on “Roman Decadence” to be one of the most interesting and entertaining articles I’ve read on the subject. But your politics has obviously been completely distorted by sanctioning yourself off into the closed information systems of Fox News and Conservative Radio. As conservative blogger and Bush speechwriter David Frum writes:

“Too often, conservatives dupe themselves. They wrap themselves in closed information systems based upon pretend information. In this closed information system, banks can collapse without injuring the rest of the economy, tax cuts always pay for themselves and Congressional earmarks cause the federal budget deficit. Even the market collapse has not shaken some conservatives out of their closed information system. It enfolded them more closely within it. This is how to understand the Glenn Beck phenomenon. Every day, Beck offers alternative knowledge — an alternative history of the United States and the world, an alternative system of economics, an alternative reality. As corporate profits soar, the closed information system insists that the free-enterprise system is under assault. As prices slump, we are warned of imminent hyperinflation. As black Americans are crushed under Depression-level unemployment, the administration’s policies are condemned by some conservatives as an outburst of Kenyan racial revenge against the white overlord.

Meanwhile, Republican officeholders who want to explain why they acted to prevent the collapse of the U.S. banking system can get no hearing from voters seized with certainty that a bank collapse would have done no harm to ordinary people. Support for TARP has become a career-ender for Republican incumbents, and we shall see what it does to Mitt Romney, the one national Republican figure who still defends TARP.

The same vulnerability to closed information systems exists on the liberal side of U.S. politics as well, of course. But the fact that my neighbor is blind in one eye is no excuse for blinding myself in both.”

It’s always a good idea to question old presumptions, as you did in the Roman Decadence article, but it’s another thing entirely to present yourself as an authority on economics when you don’t even know what the majority of economists believe, or an authority on climate science while demeaning the entire scientific community as being nothing but closet Communists, or an authority on Nietzsche when you completely dismiss the entirety of Nietzsche scholarship as a bunch of liberals projecting their own politics into the past.

On the one hand you criticize those who went into the humanities, as you chose to do, yet on the other hand you appear to think your philosophy degree makes you an expert in all fields, and your declarations that the entire problem lies in the fact that the universities throughout the nation have become safe-havens for Communistic propaganda would have appeared to be the ravings of the mentally ill even during the Red Scare, but today could easily be mistaken for a retro-generational parody. You do a fantastic job of creating an innovative archive out on a wonderfully-constructed and well-linked internet platform. Your confession towards your alienation towards fundamental precepts of Libertarianism and your acceptance of generic Neo-Con talking points, epitomized by a Christianized demonization of the Democratic Party coming from a non-Christian, proves that you have completely embraced the Right and have completely forfeited your status as Libertarian.

The Friesian Correspondence: Letter 4B: Regulators (and Democrats) Forced Banks to Lend to Minorities

Tea Party

My criticisms are long, but there is a lot to criticize.

>The code word for “socialist” in Democrat rhetoric is “liberal.” This is part of the dissimulation and misdirection that is practiced in Democrat politics. In Europe, “liberal” still means support for individual rights, limited government, and the free market. Democrats, indeed, don’t believe in any of these things.

This is absolute bunk. Democrats of course believe in individual rights far more than Republicans as is proven by their stances on the separation of church and state, homosexual issues, abortion, stem cell research, religious discrimination, and drug legalization. This is agreed upon by you in earlier articles and in the diamond quiz you cite, which places liberal on the side of “social freedom.” If anything, it’s Republicans who do not believe in individual rights. Right-wing protests against a nonexistent Islamic cultural center (incorrectly dubbed the “Ground Zero Mosque”) that had little chance of ever being built show a large number on the right do not believe in the separation of church and state or even property rights. Calls from Newt Gingrich, Mike Huckabee, Bob Beckel and John Hawkins from Townhall Conservative.com for Julian Assange to be assassinated show many Republicans don’t even believe in trials or the rule of law.

Everyone knows that today’s social liberalism of the civil rights era, which people like John McCain and Glenn Beck want to simultaneously identify themselves with and demonize, is completely different than the classical liberalism of the 19th century. Thus, Martin Luther King was a conservative, as the Heritage Foundation claims, and conservatives were “the people who did [civil rights] in the first place,” as Beck says.

Even though limited government and free market ideas do go back to “classic liberalism,” modern liberals still take inspiration from the Enlightenment and correctly identify that as the main inspiration behind the Founding Fathers while conservatives follow a mythology that these ideals were derived from the Bible, though it was apparently lost for 1400 years (unless you’re Rick Santorum, in which case only people who hate the West are critical of the Crusades).

If it’s dishonest that liberals do not feel the need to make the distinction between classic liberals (of which there’s very few) and social liberals, then the right is guilty of the same misdirection by refusing to make the distinction between the anti-“nation building” conservatism of Bush 2000 and the Irving Kristol neo-conservatism of Bush 2001. Maybe you agree that “9/11 changed everything,” but if so, you probably shouldn’t be identifying yourself with the “Party of Principle” then, because a date isn’t a principle.

It’s also ridiculous that you cite Europe as a mode of comparison since, for the most part, their conservatives are more socialist than American liberals, easily proven by asking any European conservative their opinion on the country’s universal health care, their stance on the Iraq War, or their support for state-funded renewable energy. Investors Business Daily made the laughably ignorant claim that Stephen Hawking, who credits the British National Health Service with saving his life, “wouldn’t have a chance in the U.K., where the National Health Service would say the life of this brilliant man, because of his physical handicaps, is essentially worthless.”

> The proper meaning of the word begins to emerge when we travel further into Leftist discourse. There, “liberalism” or “neo-liberalism” means the revival of free market economics after Ronald Reagan. On the hard Left, mainstream Democrats are contemptuously called “liberals,” very much as the word might be used by Rush Limbaugh. Limbaugh, however, is aware that mainstream Democrats, as Fabian Socialists, only use the word to disguise their ultimate goals, which are not much different from those of the hard Left.

So liberals are liars because they don’t accept the adopted saint of conservatism as their glorious leader? You conflate “liberalism” and “neo-liberalism” as if they are the the same thing, and then go on to suggest that they were both “revived” under Reagan, as if Carter, Nixon, and Kennedy (the last president to self-identify as a liberal), did not believe in free market economics. There is a difference between classical liberalism and the neo-liberal policies of the 1980s Washington Consensus. As Ayn Rand wrote: “Mr. Reagan is not a champion of capitalism, but a conservative in the worst sense of that word—i.e., an advocate of a mixed economy with government controls slanted in favor of business rather than labor (which, philosophically, is as untenable a position as one could choose—see Fred Kinnan in Atlas Shrugged, pp. 541-2). This description applies in various degrees to most Republican politicians, but most of them preserve some respect for the rights of the individual. Mr. Reagan does not: he opposes the right to abortion.”

>The dissimulation of Democrats is so effective that it even fools Communists (people who otherwise only became “good liberals” when they were exposed and confronted with their treasonous allegiance and obedience to the Soviet Union).

Are you talking about the same Soviet Union that has been non-existent for almost 20 years? Are we going to bypass Europe in socialism and go straight to the Soviet Union? Because 40 years of the increasing gap between the rich and the poor appears to be positioning us to look more like Mexico than Europe.

>Bad faith is evident, for instance, in the way they carefully avoid admitting that they are socialists. They know that people are aware of the meaning of socialism — the ownership and control of everything by the government — and that Americans especially have an immediate and visceral antipathy to that. Democrats think that if they talk about freedom (while promising free stuff) while in fact creating tyranny, they will be able to deceive enough people to get away with it.

So public education and public health care is tyranny but secret wars in South America and never-ending Middle East occupations is the “policing of pirates”? I suppose Nixon was a liar for not calling himself a socialist since he created the EPA and his health care plan was more to the left than Obama’s. Romney’s health care plan was similar to Obama’s and Dole’s health care plan was similar to Clinton’s, but I didn’t hear anyone calling them socialists. You may call Bush policies like agriculture subsidies, pork-barrel spending, education, and medi-care socialist, but you don’t call Bush himself a socialist, even though his spending dwarfed Clinton’s. Considering Reagan’s taxes were for the most part higher than under Obama, Reagan should also have admitted to being a socialist too. Republicans also put up “Wanted” signs of JFK for the crime of being a “socialist” as well, so I guess the real question for you is who isn’t a socialist?

>Footnote: Another good example of incoherent falsehoods, and not just from these individuals, is the Democrat slogan, “Bush lied; people died.” The idea there is that because George Bush said that Saddam Hussein had weapons of mass destruction (chemical, biological, or nuclear), and no such weapons were found after the invasion of Iraq, Bush therefore had lied. Since the ordinary meaning of a “lie” is to utter an intentional falsehood, one might wonder how the slogan chanters know that Bush was uttering an intentional falsehood. Oh, that’s easy, we can leave out the “intentional” part. If there were no WMD’s in Iraq, then Bush ipso facto lied. I kid you not. I actually saw Michael Moore argue in an interview with Bill O’Reilly that it was a lie simply because it was false. This is something worse than just sophistry. It is an infantile petulance. But we get a lot of it from the Democrats.

In September of 2007, Sidney Blumenthal of Salon wrote: “On Sept. 18, 2002, CIA director George Tenet briefed President Bush in the Oval Office on top-secret intelligence that Saddam Hussein did not have weapons of mass destruction, according to two former senior CIA officers. Bush dismissed as worthless this information from the Iraqi foreign minister, a member of Saddam’s inner circle, although it turned out to be accurate in every detail. Tenet never brought it up again.” Rumsfield certainly lied when he said “We know where they are” and Powell’s chief of staff Lawrence Wilkerson has characterized the falsehoods Powell delivered to the U.N. as “a hoax on the American people” that he unknowingly participated in. In Bush’s 2003 State of the Union address, he said “From three Iraqi defectors, we know that Iraq, in the late 1990s, had several mobile biological weapons labs … Saddam Hussein has not disclosed these facilities. He’s given no evidence that he has destroyed them.” In fact, there was only one Iraqi source — Curveball — and there were no labs. In February 2011, Curveball admitted that he had lied about the existence of the WMDs in order to influence the United States into ousting Saddam.

>Thus, after the collapse of the mortgage and housing bubble, Congressman Barney Frank, confronted with videotape of he himself saying earlier that Federal mortgage lenders Fanny Mae and Freddie Mac were financially sound, and that only enemies of poor people and minorities were calling their financial health into question, nevertheless simply denied, in a bald-faced lie, that he had ever said any such thing.

Here’s the quote you are referring to: “I think this is a case where Fannie and Freddie are fundamentally sound, that they are not in danger of going under. They’re not the best investments these days from the long-term standpoint going back. I think they are in good shape going forward.”

Nothing in there about “enemies of poor people and minorities… calling financial health care into question.” And he never denied that he had said Fannie and Freddie were financially sound. What he denied was O’Reilly’s accusation that people took his line about “They’re not the best investments” to mean “They are really good investments.” Here’s the exchange they had about that quote:

O’REILLY: All right, that’s swell. But you still went out in July and said everything was great. And off that, a lot of people bought stock and lost everything they had.

FRANK: Oh, no.

O’REILLY: And — yes, oh yes. Oh, yes.

FRANK: I said it wasn’t a good investment. Please stop yelling.

O’REILLY: Oh, none of this was your fault! Oh, no. People lost millions of dollars. It wasn’t your fault. Come on, you coward! Say the truth.

FRANK: What do you mean coward?

O’REILLY: You’re a coward. You blame everybody else. You’re a coward.

FRANK: Bill, here’s the problem with going on your show. You start ranting. And the only way to respond is almost to look as boorish as you. But here’s the facts. I specifically said in the quote you just played that I didn’t think it was a good investment. I wasn’t telling anybody to buy stock. I said it wasn’t a good investment.

Did you really come away from that conversation thinking Frank was lying and O’Reilly was completely truthful? O’Reilly, like you, tried to put words in [his] mouth, claiming that he said “everything was great” and people were led to invest in them. It’s interesting that you go so far to defend Bush as not being deceitful about Iraq in a footnote yet use such a minor quibble as your first (formal) attack against the Democrats in this essay.

In the early 1990s, while the Democratic Party still held the majority in Congress, Barney Frank supported bills to increase regulation of Fannie Mae and create a government regulatory agency that would supervise and have authority over some aspects of the company. In October 2005 the House passed a bill to establish a new federal regulator created for Fannie, Freddie and the Federal Home Loan Banks authorized to set capital standards and, if it deemed necessary, require reductions in mortgage portfolios. The Bush White House opposed the proposed legislation and instead supported the pending Senate bill, but the Senate bill never came up for a vote, and the legislation died.

In early 2007, Barney Frank sponsored a bill to create the Federal Housing and Finance Agency, granting that agency “general supervisory and regulatory authority over” Fannie Mae and Freddie Mac, and directing it to reform the companies’ business practices and regulate their exposure to credit and market risk to make sure that Fannie Mae and Freddie Mac “operated in a safe and sound manner, including maintenance of adequate capital and internal controls” and to establish standards for “management of credit and counterparty risk” and “management of market risk.”

Regardless of how financially sound Barney Frank thought Fannie and Freddie was, the whole issue has been completely inundated by Republican propaganda that Fannie and Freddie were the original cause of the financial crisis and that Barney Frank “was almost single-handedly responsible for the economic crisis,” as quoted by Fox News contributor Monica Crowley. Fannie and Freddie got into subprime junk and helped fuel the housing bubble, but they were trailing the irrational exuberance of the private sector. They lost market share in the years 2002-2007, as the volume of private issue mortgage backed securities exploded. Investment banks created a demand for subprime loans because they saw it as a new asset class that they could dominate, and Fannie and Freddie actually had to change their rules just to keep up. The private sector made subprime loans because they could get paid for making the loans, for turning them into securities, and for trading them often using borrowed capital, not because the government forced them to.

At any rate, though Fannie and Freddie do have government sponsorship, they are still private companies with stockholders, and they are hardly Democratic constituents alone, as many McCain campaign aides like Wayne Berman, John Green, Charlie Black, Arthur Culvahouse, and William E. Timmons were also lobbyists for Fannie and Freddie. “It’s a bipartisan problem,” said Bill Beach, director of the Center for Data Analysis at the conservative Heritage Foundation. Their part in the crisis would have been even larger if temporary restraints on both Fannie and Freddie by regulators hadn’t curtailed their lending just as housing prices were really taking off.

The nonpartisan Politifact.org website says: “Lax regulation also played a significant role in the crisis. Some regulatory agencies had regulation powers that they never utilized or didn’t utilize well. The Federal Reserve has the power to tighten lending standards, for instance, or raise interest rates. But officials there discouraged new rules and advised Congress repeatedly not to regulate derivatives.” Politifact also places blame for the crisis on the fact that: “In 1999, Republicans passed legislation, signed by President Clinton, specifically exempting [credit default swaps] from regulation.” Even Alan Greenspan and Republican/Libertarian-leaning Ben Bernanke admit it was lax regulation, not over-regulation, that helped cause the economic crisis.

>The preposterous thing here is that any major Democrats, especially “Chucky” Schumer, worry in the least about balancing the budget. The only reason they ever complained about Republican spending or deficits is that they wanted to sucker people into putting them in power so they can have even greater spending and deficits. The Democrat explanation for all their failed programs is always that they didn’t spend enough — the programs were not “fully funded.” Since their spending will never make their programs successful, they will, by necessity, always need greater spending. If they ever worry about paying for this, they only think about raising taxes.

Actually, G.W. Bush increased government spending by more than any of the 6 presidents before him, including the king-socialist himself, LBJ. The Congressional Budget Office estimated Paul Ryan’s plan to replace Social Security and Medicare with vouchers and to raise taxes on 90% of Americans while cutting taxes for the top 10% would add $62 trillion to the debt.

You may not like taxes on high income but it’s far more effective at driving down deficits than mythical non-military “spending cuts.” The United States has some of the lowest taxes in the world after Switzerland and tax bills in 2009 were at their lowest level since 1950. Polls show that most Americans oppose cuts to education, social security, and defense, but do want cuts to foreign aid, which they generally believe is much larger than it really is. Republicans may praise cuts but never specifically identify what spending cuts would even put a dent in the deficit. Military cuts are usually off the table despite the fact that it’s our largest and most bloated expenditure (23%), with more money going to it than the next 15 largest military budgets in the world combined (including tons of money for tanks and planes that never get used), even though our primary enemy now are terrorist groups that hide out in caves or residential zones.

David Wessel of the Wall Street Journal writes: “Say Congress zeroed out all annually appropriated domestic, nondefense spending, which amounts to about 17% of all federal outlays and excludes benefits such as Social Security and Medicare. That would mean no air-traffic controllers, tax collectors or cabinet secretaries. No test tubes, lights in federal buildings or federal job-training grants. The deficit in 2020? Still uncomfortably large: $668 billion and growing, according to estimates by the Committee for a Responsible Federal Budget, a deficit watchdog.” In comparison, the Sustainable Task Force, which includes Barney Frank and leading defense and budget experts, has identified $1 trillion in waste that that can be cut from the defense budget over the same 10 years by eliminating unnecessary Cold War-era programs.

I’ve noticed you make it a habit to justify any complaint about income inequality by stating that income roughly correlates with hours worked, but that isn’t true for the top 5%, who on average work less than the rest of the top quantile. But the larger point is there is a huge difference between 8 hours of physical labor and 12 or 14 hours of pushing papers. According to the Wall Street Journal, the richest 400 Americans have more wealth than the bottom 50% combined. According to an analysis done by Citigroup, the top 1% owns more financial wealth than the bottom 95%. A study by the Southern Economic Journal found that “71 percent of American economists believe the distribution of income in the US should be more equal, and 81 percent feel that the redistribution of income is a legitimate role for government.” With America having the highest inequality and poverty (and growing) in the OECD after Mexico and Turkey, even Alan Greenspan said that the income inequality in the United States “is not the type of thing which a democratic society – a capitalist democratic society – can really accept without addressing.”

Michael Snyder at BusinssInsider.com has published “22 Statistics That Prove The Middle Class Is Being Systematically Wiped Out Of Existence In America”:

[Statistics Redacted]

>Indeed, when it was pointed out to Barack Obama by a reporter that revenue could be increased by cutting taxing, candidate Obama responded that “fairness” was more important than revenue. Thus, although the stock Democrat response is to deny that cutting taxes increases revenue (although one of the best examples of increased revenue is when Lyndon Johnson, a Democrat, did it), Obama incautiously revealed, as he has done more than once, his real agenda — attack wealth, regardless of the damage it may do to all. Revenues may fall, unemployment may soar, the Nation may be impoverished; but the government, and the self-righteous Left, will prosper.

No mainstream economist believes this. As the nonpartisan website Factcheck.org points out: “We found that a slew of government economists – from the Congressional Budget Office, the Treasury Department, the Joint Committee on Taxation and the White House’s Council of Economic Advisers – all disagreed with that theory, saying that tax cuts may spur economic growth but they lead to revenues that are lower than they would have been if the cuts hadn’t been enacted…. For example, N. Gregory Mankiw, former chair of the current President Bush’s Council of Economic Advisers, calculated that the growth spurred by capital gains tax cuts pays for about half of lost revenue over a number of years and that payroll tax cuts generate enough growth to pay for about 17 percent of what is lost.”

As written in Karl Case and Ray Fair’s Principles of Economics (2007): “The extreme promises of supply-side economics did not materialize. President Reagan argued that because of the effect depicted in the Laffer curve, the government could maintain expenditures, cut tax rates, and balance the budget. This was not the case. Government revenues fell sharply from levels that would have been realized without the tax cuts.”

When Bush and Cheney tried to use the exact same “supply side” line, Andrew Samwick, the chief economist on Bush’s Council of Economic Advisers for 2004/05 said: “You are smart people. You know that the tax cuts have not fueled record revenues. You know what it takes to establish causality. You know that the first order effect of cutting taxes is to lower tax revenues. We all agree that the ultimate reduction in tax revenues can be less than this first order effect, because lower tax rates encourage greater economic activity and thus expand the tax base. No thoughtful person believes that this possible offset more than compensated for the first effect for these tax cuts. Not a single one.”

Reagan and G.W. Bush were the only two presidents who advocated supply side economics, the same two presidents to have their own chief economist or budget director accuse them of lying about the profits of supply side, and the same two presidents who presided over a massive explosion in national debt. The last time we started balancing the budget was under Clinton, which FactCheck.com says primarily came from his tax on high income which Republicans falsely called “the largest tax increase in history.” The Bush Administration broke it by adding $5 trillion to the debt. Dick Cheney famously said that “Reagan proved that deficits don’t matter. We won the mid-term elections, this is our due.”

>Of course, when the Soviet Union owned everything in the country, there was no private economy to tax, and the economy still didn’t work, Stalin decided it was time to kill people — “wreckers” — because sabotoge [sic] was the only explanation he could come up with for continued failure.

The Soviet Union divided property ownership into two categories: “capitalist” private property (the means of production) and “socialist” personal property (everything else). This distinction has been a source of confusion leading to the erroneous belief that all individual property was abolished, when it was not.

>The Democrats are not at that point….yet.

Is it perhaps possible to discuss financial policy without associating one side or the other with Stalin?

>This strategy goes back to the Depression, when the recession created by the collapse of the Stock Market, which was recovering by 1930 (unemployment was back down to 6%), was turned into a Depression by the Smoot-Hawley Tariff bill and then when the Federal Reserve allowed the banking system to collapse. This was actually the fault of Herbert Hoover and the directors of the Federal Reserve System. However, the Democrats wanted to blame it on “speculators” and on the banks themselves. Thus, when FDR came to power, what was wrong was misdiagnosed and policies were implemented, usually following in Hoover’s footsteps (without any credit to Hoover, except privately), that prolonged the Depression through the rest of the decade. This failure is what the Democrats have never wanted to admit, and still will not admit.

When Jude Winniski first proposed this alternative theory for the Great Depression being blamed entirely on Smoot-Hawley (or”Hoot Smalley”) as a part of his wider “Mundell-Laffer Hypothesis” of 1978, it was widely criticized by most economists of his time, including Milton Friedman. “In fact, few economists think the Smoot-Hawley tariff (as it is most often known) was one of the principal causes of the Depression. Worse mistakes were made, largely out of a misplaced faith in the gold standard and balanced budgets,” according to The Economist. Dennis Sevakis writes in the conservative American Thinker[:] “Of the $131 billion in lost economic output over the five-year period, only about $0.7 billion seems attributable to trade. This is shown as the last entry in the last row of the table. In either absolute or relative terms, the trade portion of the economic contraction of the Great Depression appears to be of little import.”

Politifact.com says that the tax laws then in force during the first three years of the depression “were initiated by steep tax cuts urged by long-serving Republican Treasury Secretary Andrew Mellon and enacted under Hoover’s predecessors, Warren Harding and Calvin Coolidge — not necessarily a winning argument in favor of low taxation.” The site goes on to say that “The second dip of the “double-dip” recession of the early 1980s — which occurred entirely on Reagan’s watch — lasted 16 months from peak to trough. That made it the longest recession between the Great Depression and today’s “Great Recession.”” but adds that “Focusing on the presidential role in combating recessions ignores other important factors.”

Although Smoot-Hawley was harmful to international trust, the majority of economists and historians believe a weak banking system, overproduction, bursting credit bubble, financial inequality for farmers and industrial workers, the Dust Bowl, and a government-held laissez faire policy were more to blame. The economy improved after the New Deal far more than it did under Hoover. According to Christina Romer, Chair of the Council of Economic Advisers and an expert on Great Depression era economics, swift government action brought forth market stability. Also notable is, shortly before the current financial crisis, the gap between the rich and the poor increased to levels not seen until right before the 1929 stock market crash.

To say Democrats alone should “admit” to a theory blaming it all on Smoot-Hawley when the New Deal has been legitimized by every sitting American president — including Reagan (as you yourself admit!) — is absurd. Jefferson himself said that banks were more dangerous than standing armies and that “the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered.”

>What the Democrats (and Mr. Frank) leave out is that banks, far from being left “to their own devices” by deregulation, were threatened by regulators (and Democrats) that if they did not make loans to underqualified, largely minority, borrowers, they would be subject to regulatory and legal sanctions. This was backed up with tendentious statistical studies intended to show discrimination against minority borrowers. Lenders were thus coerced into making loans they would not have done otherwise. They would be accused of racial discrimination if the statistics did not show the right “diversity” balance in their lending, with all the evils of legal prosecution and bad publicity falling on them. There was a remedy for this, which was for lenders to pass on the risky mortgages, often packaging them with other securities to conceal or balance the liability. These became “toxic assets,” which could be passed around like hot potatoes (with the danger that knowledge of their problems could later be used to accuse them of fraud).

While the “National Homeownership Strategy” did start under Clinton, it was greatly expanded by G.W. Bush’s “Ownership Society.”

A study released by a law firm specializing in CRA compliance estimated that in the 15 most populous metropolitan areas, 84.3% of subprime loans in 2006 were made by financial institutions not governed by the CRA. Moreover, the president and CEO of the Federal Reserve Bank of San Francisco, stated in 2008 that “studies have shown that the CRA has increased the volume of responsible lending to low- and moderate-income households.” A study published by the American Sociological Review found that “Predatory lending aimed at racially segregated minority neighborhoods led to mass foreclosures that fueled the U.S. housing crisis.” Politifact.com points out that both Obama and Hillary Clinton spoke out against the Bush Administration on “various aspects of the issue as early as 2006,” including predatory lending, while Bush ignored it.

>In January 2010, Fannie Mae and Freddie Mac have been given a virtual blank check to go into unlimited debt. We are therefore going to see a new credit bubble forming. Meanwhile, the Democrats simply practice the Bart Simpson defense: I didn’t do it.

You can thank Bart Simpson for a good deal of your own misinformation because just like he said in one of the episodes that isn’t 20 years old: “I had this dream where my whole family were just cartoon characters and our success led to some crazy propaganda network called Fox News.”

[To be concluded…]