Freedom is Not a Pendulum

The periodic swings from one party to the other in control of our government often give rise to the analogy of a pendulum. A pendulum swings from one side to the other, always passing through the equilibrium position at its center. This flawed analogy leads to the illusion that our country’s political swings from left to right also pass through a stable center that is fixed and permanent.

History belies that illusion. Throughout the history of civilization, there has never been a government that did not eventually come to an end, either through defeat in war or corrosion from within. The Roman Republic lasted 500 years before it gave way to the Roman Empire, and that too collapsed after a few hundred more years. Ancient history? Yes, indeed. But the rate of social, political, industrial, technological, and cultural changes on the global scale have accelerated, not decelerated, from ancient to modern times. Change happens much more rapidly than it used to.

We think of our government, and our nation, as permanent and impervious to destruction from without or within. That is a comfortable, but naive and historically insupportable, perspective. This country has only existed for a couple of hundred years. It will not exist forever. It too, like all other governments and nations, will someday decline or be overthrown by an enemy. Most of us cannot conceive of the demise of our country and the way of life we’ve taken for granted from birth, so we don’t believe such a thing could happen, — at least not in our lifetimes. But nobody ever realizes they’re living in a historically significant period until it reaches the tipping point and cataclysmic change is suddenly thrust upon them.

In spite of the dire, and oft-repeated, warnings of our founding fathers, the size and scope of our government has continually increased from the founding of our nation until now. For the first hundred and fifty years, the expansion was slow and gradual, with each incremental transfer of power to centralized authority a result of prolonged deliberation and strenuous debate. In the last half century, government expansion has accelerated dramatically, and continues to accelerate at an unprecedented rate. The president and Congress now sign bills into law without even bothering to read them!

Along with the increasing momentum of government expansion, we’ve also seen a pronounced trend toward more and more socialist programs and policies. By that, I mean state control of production and distribution, and increasing regulation of industry and of individual rights. The “pendulum” may still swing to one side or the other, but the center point is moving, and it’s moving ever more rapidly. We are straying further and further from the principles on which our founding fathers established this nation. When government takes power away from the people to determine what’s in their best interests, that power does not swing back to the people, like a pendulum. The balance of power is permanently shifted from the people to the government, making it easier for government to usurp even more power in the future.

History informs us that the decline and fall of our nation will eventually come to pass. But history doesn’t tell us when or how. We are on a trajectory toward the termination of the greatest and most successful experiment in freedom the world has ever known. We could stand back and idly watch it slip away and, afterward, wonder where it went. Or we could wake up and start waking up our friends and neighbors, and impress upon them what is at stake.

In his farewell address on March 4, 1837, Andrew Jackson said:

But you must remember, my fellow-citizens, that eternal vigilance by the people is the price of liberty, and that you must pay the price if you wish to secure the blessing. It behooves you, therefore, to be watchful in your States as well as in the Federal Government.

We, the people, may have it within our power to stave off the inevitable expiration of our nation by exchanging complacency for vigilance, and apathy for involvement. How long we can maintain it is unknown. But it rests with us to at least pass it on to the next generation. What happens after that is up to them.

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Connecting the Bailout Dots

	Guest Article by Jack H. Swift
	Jack’s too busy with real life to have a blog of his own, but he always has interesting things to say, so I occasionally publish a guest article by him on GNYD.

Does anyone wonder how $800 billion of bad debt in U.S. mortgages demands $3.2 trillion of U.S. loan guarantees to European banks? Why should the default of 5% of the home mortgages in the U.S. in any way compromise international banking? And how on earth does that lead to the failure of the world’s largest insurance company?

I read that roughly 50% of U.S. citizens are homeowners today (Clinton and Bush both take credit for that.) Roughly 50% of those do not have a mortgage at all. Of the 25% of our population with a mortgage, 95% are paying on time and are not in arrears. That leaves some 1.25% of our population threatening the solvency of the free world. How do you make that compute?

The official explanation is that there is a domino effect flowing from the restrained lending capacity of affected banks. There is less evidence of that than there was for the presence of WMDs in Iraq. GM and Ford were not compromised by the lack of funding for new car orders. They were compromised six months back by a lack of new car orders.

Understanding the problem demands the discovery of the connections. If there is a connector that links all these dots, we can perhaps understand.

The connector exists. It is another of these U.N. based treaties signed by our chief executive but not forwarded to the senate for ratification. This started with the U.N. International Convention on Economic, Social, and Cultural Rights. It was signed by Jimmy Carter (Nobel Prize winner) in October of 1977. It was not presented to the Senate for ratification. Rather, Carter presented the Senate with a Community Reinvestment Act which was adopted. The connector between the two appears in Article 11(1) of the signed but unratified treaty. That is the provision that there is a universal right to housing.

The CRA makes provision for a minimum percentage of mortgage loans to unqualified buyers. The CRA also makes provision for legal standing for Non Government Organizations to sue and complain under the act. Surprise, the U.N. Convention also provides for NGOs to have standing to appeal to the U.N. (ACORN is such an NGO, authorized and conceived under the CRA.) The bottom line of both the treaty and the CRA is that the government must provide a demonstrable level of “affordable housing” for those who cannot afford it. A socialistic something for nothing.

Implementation in the U.S. was undertaken through mandates (the CRA and oversight groups) requiring banks to take on a high percentage of bad risks (sub-prime). The pattern was followed in Europe. When a bank’s book of loans begins to develop too great a percentage of high risk investments, other banks and other investors hesitate to offer up their money. (Enter the credit squeeze.) This happened across Europe.

Troubled banks sought to insure their bad loans. (Enter AIG.) In the U.S., given the rising market in housing, it was not possible to lose money on a bad mortgage. AIG insured billions of dollars of bad debt for European banks, thinking it a good deal.

Then the housing bubble burst, and not just in the U.S. Foreclosures were suddenly a loss, not a profit. AIG could not take the hit and the feds had to step in, insuring the payment to European banks of their bad debts. (If AIG could not make good on the losses suffered, European banks would fold. — The level of bad debt investment in Europe was that high.)

The bottom line is that we are looking at yet another failed attempt at international socialism. The objective was to provide a basic right of housing (presumed under the U.N. Treaty) regardless of the capacity of the individual to earn it. (Economic rights don’t have to be earned. They are inherent.)

McBama have it all wrong. Greed on Wall Street did not cause this failure. The broker’s golden parachute did not cause the immigrant in Germany to default on his home loan. He defaulted because he couldn’t make the payment which was a foregone conclusion when the loan was made.

Milton Friedman once said, “There is no such thing as a free lunch.” He obviously had a better handle on the situation than the U.N., the European Union, the U.S. Senate, or Jimmy Carter.

The question for us now is do we solve this failure of socialism with simply more money invested in socialism? BHO wants to raise taxes, extend unemployment benefits, provide more food stamps, and guarantee that all these credit criminals do not lose their something for nothing. This will make us healthy?

Can we solve our internal problem of $800 billion in bad debt by transfer? The credit criminals’ debt became the banks’ bad debt. By way of the bailout, we have made the banks’ bad debt the debt of future taxpayers. How does this solve anything?

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