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Bob who?

“You’re voting for who?” I’ve been asked by friends and relatives who wonder why I’d waste my vote on Libertarian party candidate Bob Barr. “You might as well stay home” some advised. “What a dopey thing to do!” one threw in.

This coming from people who complain about the mafia-style duopoly our government and political process have become. People who’d rather vote for the lesser of two evils, rather than what they truly believe. And who can blame them? It’s not easy taking third, fourth and fifth party candidates seriously when the Democrats and Republicans make it next to impossible for any viable options. The GOP for example, has succeeded in keeping Bob Barr from the presidential debates, and was nearly as successful in keeping him off the ballots in certain states.

It’s still a financially Herculean task to compete against the two major parties’ multi-million dollar campaigns to get their candidate into a job that pays only $400,000 per year. And one which they must resign from after 8 years anyway. Simple math doesn’t justify such an insanely expensive job campaign. But it makes sense when one adds up what the interest groups behind those campaign dollars have to gain.

Which is why listening to Obama talk about his plan to improve our public schooling system by hiring “an army of teachers” as opposed to more results oriented voucher programs, I hear the teachers’ unions talking. Listening to McCain speaking about victory in Iraq even if it takes 100 years, I hear weapons contractors strategizing. Listening to them both talk about “tackling” the global warming hype now touted as climate change, which is inevitable, I hear a number of energy industry lobbyists and environmental groups who stand to gain from a $78 billion dollar a year cap and trade agreement.

Yet when I’ve listened to Bob Barr speaking about the dire need to cut government spending and entitlement programs, I not only hear a sound, responsible economic principle, but I hear the average hardworking American who’s fed up with their tax dollars being insufferably wasted by inept governmental agencies that have become unionized bureaucracies. I hear people who understand that real needed change doesn’t need to be a trillion dollar yearly deficit. I hear those who realize voting for policies that actually work, let alone they believe in, is far less “dopey” than staying at home and letting an all too powerful two-party system shut you up, and shut you down altogether on yet another election day.

We, the market

We, the people, are the market. Not OPEC, the Dow, Goldman Sachs, or much less the Federal Reserve. The market is you and I with our dollars in our hands. It’s third graders spending their allowance on a favorite soda, let alone hassling their parents to purchase the latest X-Box game. Anyone buying anything they need or want is more significant in determining value than any broker on the NYSE trading floor.

There’s no “invisible hand” driving the markets. They’re not an abstract theory. They’re  the real and inevitable confluence of our creating, buying, selling or trading  of goods and/or services within various industries or demographics which we all comprise at different times. It’s difficult for many to comprehend the chaotic nature of economic liberty, ie free markets, creates the most opportunities and abundance from scarcity.

Free markets are infinitely more efficient than controlled economies such as Cuba’s, where rationing is deemed ethical, but it’s results are disastrous. For example,  asthma inhalers . Sure, they’re 5 cents. Because you’re only allowed one per month, which you still need to pay for. If you need more, as most asthmatics do, the only option is buying them on the black market for practically one month’s wage. Or having family send it from abroad.  Just a minor detail Michael Moore failed to mention in Sicko.

Which is why it’s dumbfounding to now hear Alan Greenspan speak of the “flaw” in his free market ideology and how he must re-examine it. “I still don’t understand exactly how it happened” he’s stated. Fortunately, some economic experts do.

Even those who supported Greenspan admit his two greatest mistakes were lowering interest rates dangerously low, thus creating “easy money”, and his encouraging people to take Adjustable Rate Mortgages during the ensuing real estate boom. Ultimately, it was creative financing   coupled with derivative formulas and exotic securitization schemes concocted by investment firms and hedge funds which sold “securitized” mortgage packages from banks to financial institutions around the world, all based on credit and speculation, that are the true culprits behind this global financial crisis, not free markets.

It would behoove Greenspan to make a clear distinction between the abuse and exploitation of credit and the right for people to buy, sell, earn a profit, and ultimately own property within the “free market”. If anything, Greenspan’s biggest mistake now is providing fodder for the Michael Moores and the Naomi Kleins who will preach socialism is the answer and belittle the average Joe they purportedly represent, especially if he’s a plumber who dares question the proven failure that is the forcible redistribution of wealth which hardly benefits we, the people, in the long run.

Decidedly Undecided

With only two weeks away from the election, there are still millions of Americans who feel they are without a candidate. And not because they’re undecided. They’re actually decided on the fact that neither Obama nor McCain represent anything they stand for.

Neither candidate is willing to openly support the right for gay marriage. Neither strongly support the second amendment right for individuals to bear arms in their own homes. Neither have clearly distinguished the crucial difference between actual environmental pollution from the global warming/climate change hype and its trillion dollar cap and trade boondoggle attempts. Neither have delineated a foreign policy that is any more competent than the Bush administration’s; McCain seems way too aggressive and is setting his sights on Iran, while Obama seems to say whatever it takes to appease the media. But most importantly, neither have any sound or practical plans to ameliorate the current financial crisis. McCain has expressed the need for some serious cuts in government spending, which is a great start, but most fiscally conservative voters are doubtful given the Republican party’s record of reneging on such promises.

And yet the millions of Americans who are painfully aware that neither candidate truly represents them, are equally aware that their vote for a third party that does, such as Libertarian candidate Bob Barr, will fall on deaf ears. And thanks to efforts by the Republican party to keep Bob Barr off the ballot in certain states, and having kept him from any of the presidential debates, millions of more Americans will have no idea they had much of a choice outside the two parties other than Ralph Nader.

The tragic irony is that the Libertarian party’s principles of true liberalism and limited government are not only the most pragmatic and cost effective solutions to our fiscal and foreign policy problems, but are the very principles this nation was founded on. George Washington was wise enough to warn about partisan politics back when it was between the Federalists and anti-Federalists. It’s curious how the anti-Federalists then became the Democratic-Republicans, which later split into the myopic duopoly our political system has unfortunately become. One in which both parties are almost indistinguishable from each other in their zeal to spend our tax dollars against our best interests by conveniently confusing the difference between inalienable rights and multi-billion dollar entitlement programs, and then mistake our disillusionment for indecisiveness.

How to save capitalism

October 14, 2008 2 comments

“What the hell is a credit default swap?” a friend of mine asked at work. It was an odd question since he usually shies from talking politics and instead sticks to football or the latest Kimbo Slice fight on youtube.

Until this current financial crisis, which seems to mushroom by the minute into a full blown global catastrophe, I used to take pride in being an armchair economist. But as a staunch supporter of the free market system, and that evil word “capitalism”, my beliefs have been greatly challenged as of late. I’ve begun to ask myself what is it that works about capitalism and what doesn’t, though I remind myself that its basic definition – an economic system which allows individuals the right to own property and produce goods and services from that property in order to sell them at a profit in a free market – definitely works. And in my humble (and arguably biased) opinion, that specific right is well worth fighting for.

Especially after having seen first hand how communism, capitalism’s  polar opposite, has tragically affected the lives of all my relatives from Cuba who’ve risked everything to leave that tropical “utopian experiment”, and especially the ones who’ve remained and are currently enduring yet another national food shortage. Which is why it shakes me to the core to read editorials such as last week’s Washington Times “The end of American capitalism?” and to hear the overall national dialogue come to such a grim, and drastically misguided conclusion.

But as more conversations around the office shift from who might be in the NFL playoffs to wondering whether we should temporarily freeze our 401Ks by switching our portfolios into short term reserves as opposed to stocks, I’m realizing that the real mess behind this crisis isn’t capitalism per se, or the right to own property. What has wreaked the havoc we’re facing now is more about creative financing,  complicated derivative formulas, securitization, hedge funds, short-selling, and the most deceptively simple term of them all, credit.

Yet credit is a double edged sword. For millions, it is the very reason why they have a roof over their head. It has allowed businesses to prosper and come to life in the first place. When used responsibly, it helps create countless jobs, products and services. Credit is actually a right. But when exploited, it can charge a highly usurious interest on our freedom.

Savage neo-liberal capitalism

September 22, 2008 1 comment

Funny how government always comes to the rescue last minute to correct the problems it helped create in the first place. Fortunately, Wall Street is only a stone’s throw away to take the blame instead.

But how many of the same people who enjoy parroting the trendy, way left of center cliché that greedy CEO’s and corporate America should hang will take the time to read about the government mandates that helped promote subprime mortgages to begin with? How many in the media will be reporting about the unintended, but predictable consequences behind the noble pursuit of the Community Reinvestment Act of 1992, which stems from Jimmy Carter’s administration?

For anyone wondering why banks took on such risky loans from borrowers, how many will remember Franklin Delano Raines, the Clinton-appointed head of Fannie Mae who took an early retirement in 2004 after having made it his top priority for people with poor credit to get mortgages for minimal money down thanks to programs such as the CRA? Was it really about ensuring more people, particularly low-income families and minority groups could finally become homeowners? Or was it the million dollar bonuses Raines and others received for overstating Fannie Mae’s earnings and bundling an inordinate amount of bad loans with good ones and convincing investment banks all over the world they were a safe risk since they were “government insured”? Will anyone other than the financial papers bother reporting about Raine’s and Fannie Mae’s shoddy accounting practices that involved overstating profits by $6.3 billion, making the infamous Ken Lay and Enron’s $567 million overstatement look like a conceivable mistake? Where is the outrage in the mainstream media now?

As usual, it will be misplaced by journalists who find it much easier to report unfounded drivel. Such as the current chorus of “intellectuals” who don’t understand actual, inevitable economic realities such as price elasticity and budget constraints but are quick to coin misleading, albeit catchy phrases such as “savage neoliberal capitalism”. Terms sure to become a hit among the Che Guevara T-shirt crowd who keep a watchful eye on “the system” between sipping Chai Lattes and pondering the profundity of Noam Chomsky. Their flawed interpretation of events in turn will “trickle down” and churn the next conspiracy theory involving the rich spend every waking hour trying to keep the poor from achieving the American dream. God forbid the average taxpayer should ever hear another side to the argument such as the facts.

Don’t look back in anger

September 13, 2008 Leave a comment

“We’re mad as hell and we’re not going to take it anymore!” may become the Democrat’s battle cry for these last weeks before election, and quite possibly the worst strategic advice bandied about by political pundits. Yet it’s telling about the mindset of die-hard politicos who base their worldviews on personal sentiment rather than carefully thought out logic, particularly on economic issues. But more importantly, it may be the reason why McCain could cinch this election come November.

“There is no question Sarah has been like a Trojan moose” Arianna Huffington mentioned on Larry King. “It’s really up to Barack Obama to make sure it (McCain’s strategy) doesn’t work. And the way to do that is to release his righteous rage…” was her sage advice.

James Carville’s words of wisdom weren’t too far fetched on Andersen Cooper. “What I think Senator Obama needs to do, and I think he’s starting to do that some, but he needs to do it exclusively, is be angry about what happened to the United States of America and what happened to people under Bush and McCain and the policies that McCain has vowed to continue.”

The most obvious connection to this juvenile strategy has been pointed out by Glenn Beck, a conservative TV and radio personality and staunch opponent of Obama who is far enough removed to see the warning sings of implosion. Only he’s actually warning Obama to chill out. On Beck’s radio show he featured Obama’s interview with Keith Olbermann on Sept 8, where Olbermann suggested: “Have you thought of using on the campaign trail and in your speaking engagements more exclamation points? Have you thought of getting angrier?”

And it seems Obama has. “Enough!” he almost shouted, when addressing the “lipstick on a pig” remark that could’ve easily been avoided in the first place.

As a Libertarian casting his long shot vote on Bob Barr, I can’t help but roll my eyes and shake my head at the futile, predictable, and never ending battle between Republicans and Democrats come election time. But as a word of advice to Democrats who don’t want to see McCain grab hold of the American presidency any more than Libertarians do, please tell Obama to NOT follow the advice of hot headed, self-righteous minded talking heads. It’s hard to believe that same approach many have complained got us in the mess we are in the first place, is somehow going to get us out it now.

The Price for Change

I’ll admit to being surprisingly moved, and even enlightened by Barack Obama’s stirring and undoubtedly historic speech for his nomination at the DNC. One line in particular called out to me.

“America, now is not the time for small plans.”

Taxpayers beware. While it was enlightening to hear Obama articulate the modern day ideals of the Democratic party, and how it views Republican philosophy, my skepticism kicked in after hearing the word “change” uttered over a dozen times throughout.

An “army” of new teachers. Five million new jobs that pay well and can “never” be outsourced. The genuine intention to solve “climate change” which well over 31,000 scientists have signed a petition stating there is no conclusive evidence man is creating the undeniable warming of the planet, and the $3 trillion tax scheme to throw money at the problem in the form of cap and trade which both Obama and McCain are vying for.

Yet his claim for cutting taxes for 95% of American families sounded reassuring enough, and this other line was my particular favorite.

“I will also go through the federal budget, line by line, eliminating programs that no longer work and making the ones we do need work better and cost less because we cannot meet 21st century challenges with a 20th century bureaucracy.”

But the cost analysis calculated by the National Taxpayers Union Foundation tells another reality. According to their most recent studies, Obama’s proposals represent over $340 billion in yearly deficits for government spending.

Anyone who has studied and compared economic policies that actually work and those that fail consistently, would naturally be weary. Michael Tanner, director of Health and Welfare Studies at the Cato Institute recently highlighted some of Obama’s policy details that inevitably add up. Particularly in the future for millions of young voters who are naturally inspired by the message of “change”. His opposing benefit cuts that allows workers to privately invest a portion of their Social Security, increasing benefits under Medicare’s prescription program which thanks to Bush is already estimated at $10 trillion (yes, with a “t”), and Obama’s “community rating” requirement where health insurers must charge everyone the same premium regardless of health status all come with a burdensome price tag.

Even the Congressional Budget Office’s projections state that unless spending is brought under control, both corporate and income tax rates will rise from 35% to 88%, the current 25% tax rate for middle-income workers to 63%, and the 10% tax bracket for low-income workers to 25%. A drastically, and calamitously different picture than a simple platitude claiming tax cuts for 95% of working families.

But who am I to read between the lines and question the Democrat party’s judgement? Just another taxpayer skeptical of the actual price for “change”.