Why Islam Must Be Expelled From The West

December 31, 2010

by Fjordman

Fjordman speaks the unspeakable

(Editor’s Note: I threw this Molotov cocktail into the room to gauge the reaction from readers. I haven’t determined yet if I agree or disagree with Fjordman. But does Islam pose a serious threat to any state that secedes and becomes a sovereign nation? Let us know your comments.)

On the 11th of December 2010, the first-ever suicide bombing in Scandinavia occurred when Taimour Abdulwahab, an Iraqi-born Muslim and Swedish citizen with a wife and children in Luton, Britain, was carrying explosives and mistakenly set off an explosion near a busy Christmas shopping street in Stockholm just before he could murder dozens of people.

Foreign Minister Carl Bildt, who is a passionate promoter of having Turkey as a full member of the European Union and Islam as an established part of European culture, stated that “We were extremely lucky… I mean minutes and just a couple of hundred metres from where it would have been very catastrophic.” Sweden’s intelligence agency and a news agency received an email with audio files in which a man called on “all hidden mujahedeen [Islamic holy warriors] in Europe, and especially in Sweden, it is now the time to fight back.” He criticized Sweden for its military presence in Afghanistan and its acceptance of the artist Lars Vilks, who had made some cartoons mocking Muhammad. The message warned that “now your children, daughters and sisters die like our brothers’ and sisters’ children die.”

We’ve been told for years that suicide bombers who blow themselves up in civilian areas in Israel are “freedom fighters struggling against Israeli occupation.” Does that mean that this Muslim blew himself up to protest against the Swedish occupation of Stockholm?

Sweden has no colonial history, at least not outside of northern Europe. It is a self-appointed champion of Third World countries and has virtually surrendered its third-largest city to immigrant mobs and substantial chunks of other cities, too. Swedish authorities are using the most extreme methods imaginable to suppress any dissent among the native people, who are being ethnically cleansed from their own land. The authorities always side with immigrants against the natives in the case of conflict. Muslims in Sweden can harass the natives as much as they want to and have access to all kinds of welfare goodies and a much higher standard of living than they would have in their own countries. In short, they have no imaginable, rational reason to complain, yet they still blow themselves up.

In Sweden, all the traditional excuses employed by Multiculturalists and Leftists throughout the Western world, fail. This leaves just one possible explanation, the only one never mentioned in Western mainstream media: That Muslims and their culture are fundamentally incompatible with our values and societies.

Hassan Moussa, who has worked as an imam at the largest mosque in the city of Stockholm, has earlier been accused of spreading double messages. What he said in his harsh speeches in Arabic didn’t match the text as translated in Swedish. A journalist warned that “Sweden’s mosques are slowly but surely being taken over” by the Muslim Brotherhood. Following the 2010 suicide bombing, Moussa’s recommendations for how to prevent similar events in the future involved giving more power to imams and having a “zero tolerance for Islamophobia.”

Prohibiting all forms of criticism or mockery of Islam and its Prophet is an essential part of sharia, Islamic religious law. According to Islamic historical sources, individuals such as the poetess Asma bint Marwan were killed by the followers of Muhammad for having done nothing other than mocking Islam. This then became a part of the Sunna, the personal example of Muhammad and his companions, which is the most authoritative source of Islamic law next to the Koran itself. It was for the same reason that Theo van Gogh was murdered in Amsterdam in 2004. Yes, mainstream, traditional Islam today stipulates that those who mock Islam deserve to be murdered. No other major religion on this planet dictates anything similar.

It sounds nearly unbelievable to the average person that one of the largest religions on Earth, which is “respected” by the United Nations and political leaders worldwide, can be that bad, but this is unfortunately true. Not only is this the case, but the Organization of the Islamic Conference (OIC), the largest voting bloc at the UN, is teaming up with other dictatorships and African nations as we speak to ban “Islamophobia” across the world, also in the West.

Islam is more totalitarian than the most totalitarian ideologies that have ever existed in the Western world. Even Der Führer or Comrade Stalin never expected or demanded that every single man should copy all of their personal habits and their silly little mustaches, for which we should be eternally grateful. Islam, on the other hand, stipulates that all men everywhere and for all times should copy Muhammad’s personal habits and example in minute detail.

Islam is a creed which says that men should urinate like Muhammad and that Muslims should wage a war against all other men on the planet until they, too, urinate like their Prophet. This is a provocative way of putting things, yes, but theologically speaking it is not incorrect. While Muhammad was not divine he was, as some Muslims say, the “living Koran.” John L. Esposito in Islam: The Straight Path, one of the most pro-Islamic books in existence, states:

“Muslims look to Muhammad’s example for guidance in all aspects of life: how to treat friends as well as enemies, what to eat and drink, how to make love and war. Nowhere is this seen more clearly than in the growth of Prophetic traditions….His impact on Muslim life cannot be overestimated, since he served as both religious and political head of Medina: prophet of God, ruler, military commander, chief judge, lawgiver. As a result, the practice of the Prophet, his Sunna or example, became the norm for community life. Muslims observed and remembered stories about what the Prophet said and did. These reports or traditions (hadith) were preserved and passed on in oral and written form. The corpus of hadith literature reveals the comprehensive scope of Muhammad’s example; he is the ideal religiopolitical leader as well as the exemplary husband and father. Thus when many Muslims pray five times each day or make the pilgrimage to Mecca, they seek to pray as the Prophet prayed, without adding or subtracting from the way Muhammad is reported to have worshipped. Traditions of the Prophet provide guidance for personal hygiene, dress, eating, marriage, treatment of wives, diplomacy, and warfare.”

According to sharia, non-Muslim dhimmis can on certain conditions be allowed to retain their lives under Islamic rule, provided that they remain totally submissive to Muslims at all times. Any perceived “insult,” however slight, could immediately trigger violent reactions. In practice, a mere rumor that anybody has done something which displeases Muslims can cause retaliations and murders. This is how Christians in Pakistan or elsewhere live on a daily basis, constantly fearful of Jihadist attacks, and this is how many Muslims want us to live as well. Meanwhile, our authorities, intellectuals and mass media continue to import people who are plotting to murder us while we have our genetalia screened and checked at our airports.

If a single non-Muslim says anything critical about Islam, his entire community can in principle be punished for this. Basically, this means that if one cartoonist in Germany, the USA or Denmark makes a cartoon mocking Muhammad, this could potentially trigger Jihadist terrorist attacks against his entire country for “waging a war against Islam,” because his “tribe” is held collectively responsible for his actions. This was exactly the Islamic logic behind Taimour Abdulwahab’s terror attack in Stockholm. There is no such thing as an individual in this culture; the tribe is everything. Muslims, being good hypocrites, are always the first following an Islamic terrorist attack to state that all Muslims should not be punished for the actions of a few, yet this is precisely what their own laws prescribe for non-Muslims.

Before the general elections in 2006 the Swedish Muslim League, the largest Islamic organization in the country, published a long list where they not merely requested, but essentially demanded, separate family laws for Muslims; that public schools should employ imams to teach homogeneous classes of Muslims children in the language of their original homeland. (The Swedish city of Malmö already has pre-school classes where all teaching is conducted in Arabic. This is “good for integration.”); a “mosque in every municipality,” built through interest-free loans made available by local municipalities to demonstrate “Islam’s right to exist in Sweden” and to “heighten the status of and respect for” Muslims; separation between boys and girls in gymnastics and swimming education; and laws instating Islamic holidays as public holidays for Muslims. Swedes should also ensure that all Muslims get two hours off from work during the congregational Friday prayer every week and an Islamic burial ground available in every municipality in which there are Muslims. Last, but not least, they demanded that the authorities and the already heavily censored, pro-Multicultural mass media should take even stronger steps to combat “Islamophobia” in the general public.

These demands were rejected back then, but they will be repeated, not just in Sweden but throughout the Western world. As long as we have sizeable Muslim communities here this is inevitable. Muslims are not here to live in peace as equals; they are here to colonize, subjugate, harass and dominate us. Their holy book, the Koran, demands nothing less.

But if all of this is true, how can we coexist peacefully with Muslims in our countries? The short answer is that we cannot. No matter how much you appease them, it will never be enough. As a matter of fact, since they come from a culture which respects only brute force they will despise you as weak and become more aggressive if you try to reason with them.

Their religion also states that Muslims are the “best of peoples” – the true master race – and that they are destined by Allah to rule all mankind. They are filled with illusions of grandeur and superiority, yet the harsh reality is that their societies are lagging behind those of others. This constitutes an inversion of the natural order which can only have been caused by demonic actions and must be reversed at all costs. As long as they remain in our countries, they will work to subvert and destroy us. It is quite literally a religious duty for them to do so.

So why don’t you hear this from most Western political leaders or mass media? Because they are lying to you, plain and simple. The truth is that there is no such thing as a moderate Islam; that nobody has yet managed to come up with a credible theoretical way to reform Islam; and that there are no practical indications of any softening or modernization of Islam actually taking place. Since the adherents of this creed in its present form are waging a war of annihilation against us and the civilization we have created, this leaves only one possible conclusion if we wish to retain our culture and freedom: Physical separation. Islam and those who practice it must be totally and permanently removed from all Western nations.

Potential objections can be raised to this solution. One is that it might provoke Muslims and trigger a world war. To this I will say that our mere existence as free and self-ruled peoples constitutes a provocation to them. Besides, we are already in a world war. Technically speaking, it started 1400 years ago, the mother of all wars. Against European civilization it has witnessed two main phases, the first one with the Arabs in early medieval times, and the second one with the Turks in early modern times. This is the third Islamic Jihad, and it has penetrated deeper into Europe than ever before because we don’t fight back. If the other guy walks up to you and starts punching you in the face then you are already in a fight, whether you want this or not. If you do not defend yourself properly then you have already lost.

Another objection is that expelling Muslims from the West would not end the war. They would merely continue from their original home countries, aided by missiles and modern technology. This could well be true. The separationist strategy does not imply that removing Islam from the West alone is all that will ever be required, only that this is the bare minimum that is acceptable. If Muslims remain aggressive, we retain the option of further actions, including directly targeting their holy cities of Mecca and Medina using conventional or non-conventional weapons. Having large numbers of Muslims in our societies is anyway very costly, and the aggressive fifth column in our midst will severely limit our freedom of action.

Finally, one could claim that the overall problem with the modern West is the general mass immigration and Multiculturalism promoted by our treasonous elites and that Islam merely constitutes a secondary infection. This is also partly true. No, just because Muslim immigration is especially bad does not mean that all other forms of immigration are unproblematic. Nevertheless, Muslims top the list over hostile aliens who do not belong in European or European-derived nations. The Islamic threat is real and needs to be dealt with.

The Serbian-American writer Serge Trifkovic, author of the book Defeating Jihad, has stated that the ongoing failure by their entrusted leaders to demographically protect European and European-derived nations constitutes the greatest betrayal in history. I am tempted to agree with him. In the end, the traitors and fifth columnists we have in our media and academia must be removed from power and replaced with people who are loyal to us and our nations.

Courtesy www.Europenews.dk

The Free Market Gold Standard

December 30, 2010

How to Defend the Free Market Gold Coin Standard: Stop Defending the Government Counterfeits

by Dr. Gary North

This was posted on one of my site’s discussion forums on the night before Christmas:

Gold based economies more volatile than central bank fiat based money economies??

Roubini: On a return to the Gold standard

“When you had a traditional gold standard, boom and bust with severe swings in economic activity were the norm–really big ones. It was only once we moved to fiat money that central banks were able to smooth the business cycle, and make it less volatile, as we did during the financial economic crisis.” – Nov 2010

Where do they get these ideas? Or rather where did I get the idea the boom and busts would be smaller in a gold based society? I know I have heard this multiple times.

But they did have bank panics in the 1800s. So maybe they are right?

My bet is that the booms and busts will occur in a gold based economy but they will not be so big and wild or last as long as in a fiat money based economy.

The person who posted this is well meaning. He senses that Roubini is wrong, but he is not sure exactly why. He is typical of the overwhelming minority of those who think that a gold standard would be a good idea. He means well, but, as they say, he doesn’t get it.

What is “it”? The logic of the free market.

So, let us begin. First and foremost, a government-guaranteed gold standard is a rotten idea. It is just a little better than a fiat-money standard. But advocates of “the gold standard” almost always mean “a government-guaranteed gold standard.” Therein lies the problem. Governments lie. They cheat. They steal.

Over and over, I have returned to this theme: a government-guaranteed gold standard is a fool’s gold standard. I have had great trouble in getting this idea across.

Over and over, I have returned to this theme: a government-guaranteed gold standard is a fool’s gold standard. I have had great trouble in getting this idea across.

There are two kinds of gold standards: government-guaranteed and privately administered. The first is a counterfeit of the second. The politicians set up the rubes to be skinned. I have written about this here:


I hope you will click the link, print out the 2003 article, and read it twice.

The idea of the gold standard pre-dates Austrian School economics by a century. Ludwig von Mises created the Austrian School by applying the general principles of economics developed by Menger and Bohm-Bawerk to monetary theory: The Theory of Money and Credit (1912). Here, we find the first integrated defense of a free market gold standard.

A short presentation is Murray Rothbard’s mini-book,
What Has Government Done to Our Money? (1964).

Something close to a free market gold standard existed in California in 1849-54. That is about the only place it has ever existed.

Here are the characteristic features of a free market gold standard:

1. Private property
2. The right of contract
3. The enforcement of contracts by the government
4. No government licensing of banks
5. Open entry in coin production
6. No government mint
7. No government currency or coins
8. Therefore, no legal tender laws

The legal framework begins with private property. The monetary system develops out of this. If the monetary system does not begin with private property and the right of contract, then it is just one more government substitute for liberty. It will fail to bring liberty or maintain it.

Here was what Mises advocated: free banking, no bank regulations beyond the general enforcement of contracts, and no central bank supported by the government.

Out of this legal framework will develop a free market gold coin standard, a free market silver coin standard, and maybe other standards. The various currencies would fluctuate in price, just as all other commodities fluctuate in price. These would be parallel currencies, not price-controlled currencies. There would be no government-enforced price controls that set the price of silver in terms of the price of gold.

The government would specify the form of acceptable currency for the payment of taxes — nothing else. It would not issue coins or currency of its own. It would not enter the money business. Whenever governments enter the money business, the public should expect monkey business.

This system of economic liberty is the great enemy of civil governments. Therefore, they all create alternative monetary systems. One of these is the government-guaranteed gold standard. A government-guaranteed gold standard is not worth the paper it’s written on. It’s a deception. It is always violated at some point.

Conservatives who have never read Mises or Rothbard on money nevertheless regard themselves as free market economists, because they favor a government-guaranteed gold standard. Such a standard has not existed anywhere since 1933, and did not exist anywhere else, 1914-1933.

So, when anti-gold economists attack the gold standard, they are attacking the phony gold standard…the imitation standard…created by major European governments in the 19th century. Those governments did the following:

1. Limited private property
2. Did not allow the right of contract
3. Did not enforce all voluntary contracts
4. Licensed banks
5. Forbade entry in coin production
6. Ran government mints
7. Established government currency and coins
8. Passed legal tender laws

The critics think they have been successful when they point out that this pseudo-gold standard had major problems. Of course it had major problems. It was an anti-free market gold standard.

The Keynesian critics’ preferred solution is fiat money: unlimited deception, corruption, and currency destruction by the national government.

The defenders of the phony gold standard have self-doubts. This is good. The system they defend was corrupt from day one.

Now, if I can just persuade the self-doubters of the legitimacy and wisdom of the free market. . . .

© 2005-2010 GaryNorth.Com, Inc. All Rights Reserved.

Charity Should Stop Here

December 29, 2010

By Martin Hutchinson

(Editor’s Note: Tax deductions are one of the ways that government either rewards or punishes people for their behavior. In a state that secedes and becomes a new nation, we hope that the idiocy that is Washington’s criminal tax code would not exist. Charitable deductions are a part of that tax code and should not exist. DumpDC does not care a whit if charitable deductions “cost” the Treasury any money. Our only concern is individual liberty and property rights.)

At this season of goodwill, my thoughts immediately turn to that unsung hero Ebenezer Scrooge, and this year, in view of the subject’s topicality, to his possible thoughts on today’s major economic policy problem in the United States of tax reform and budget deficit reduction.

One thing immediately springs to mind: he would wish to eliminate the income tax deduction for charitable contributions. Old Ebenezer would in this case be magnificently right.

The tax deduction for charitable contributions was an early feature of the US income tax code, introduced in 1917 because of a concern that the wealthy would stop donating to higher education when hit by higher taxes for World War I. Since only the rich paid significant income tax at that time, the provision cost little and had little effect; in any case deductible charitable contributions were limited to 15% of the taxpayer’s income.

By World War II, income tax had been extended to most of the population and tax-deductible charitable contributions had become major income sources for many charities. Consequently when congress sought to introduce the standard contribution in 1944, to simplify the income tax system for most taxpayers by removing itemized deductions, charities fought the provision tooth and nail.

Today, up to 50% of a taxpayer’s income may be deducted as charitable contributions and the provision is budgeted to cost the revenue US$54 billion in the year to September 2011. In addition, charities’ investment income is exempt from tax, generating a “tax expenditure” estimated at $60 billion, charitable bequests’ exemption from estate tax costs an estimated $10 billion on the annual $24 billion of bequests, and other minor tax exemptions cost $6 billion.

In total, therefore, charitable tax exemptions cost the Treasury about $130 billion, or on the cuckoo 10-year accounting used in budget calculations, some $1.8 trillion over the period 2011-2020 – which would make a decent dent even in that decade’s horrendous budget deficits. In addition, state and local tax exemptions for charities cost $30-50 billion. The charitable contribution income tax deduction is very inefficient according to a 2009 Congressional Research Service (CRS) study of the sector; thus its $54 billion cost increases charitable donations by only about $27 billion.

The nonprofit sector (including religious and cultural institutions) represents a sizeable portion of the US economy. According to the CRS study, nearly 10% of the US workforce works in the non-profit sector, with 7% employed by charities. Non-profit employment increased by 16% between 1998 and 2005. Total charitable revenues were $1.4 trillion in 2008, about 10% of gross domestic product, while charitable assets totaled $2.6 trillion. Including other nonprofit associations, revenues totaled $2 trillion and assets $4.2 trillion.

Private contributions represented $144 billion, 12% of charitable income, government grants and payments totaled $351 billion, private payments for services represented $590 billion, investment income $81 billion and other income $30 billion. Private contributions were most important in arts and environmental charities, representing over 40% of funding for those sectors (albeit only $19 billion in total) while they represented only 2% for funding for healthcare charities, for example.

The differences in charitable giving between bottom and top-income brackets are striking. For example, 41% of charitable donations directed at the poor come from those earning less than $100,000 (almost none of whom itemize deductions), whereas only 14.6% come from the really rich, with incomes over $1 million. The really rich direct 21% of their charitable donations to the poor, directly or indirectly, compared with 30% for the population as a whole.

Employment in the charitable sector is highest in the District of Columbia, with 16.3% of its workforce employed in that sector, then Rhode Island with 13.6%, then New York with 13.3%. At the other end of the scale, Nevada has the lowest charitable employment, at 1.8%, followed by South Carolina, Louisiana and Mississippi, followed by Texas with 4.1% employed by the charitable sector. Colorado, California and Florida are all towards the low end of the scale.

Immediately one fact jumps out at you from this comparison: charitable employment is strongly inversely correlated with economic growth. While there is only a modest correlation between charitable activity and income (Rhode Island is close to the national median income per capita, below Louisiana and Texas) the jurisdictions that have shown the most robust economic growth in the last 30 years are those where charities are least active.

A little Public Choice Theory will tell you that the damaging effect on the local economy of a high concentration of charities is no illusion. The private sector involves resource allocation by those directly benefiting, while government is inefficient because it involves resource allocation by bureaucrats, who do not directly benefit from the outcome.

However, even governments are to some degree subject to popular control. In the case of charities, resource allocation is made by people with a political agenda, seeking to maximize their resource collection from rich people with little knowledge of the problems the charity addresses, whose decision making is obfuscated by incessant misleading charity propaganda. Thus, charitable activity is even more economically inefficient than government, and excessive charitable activity holds back the local economy by diverting resources from the local private sector.

Turning to charities’ internal efficiency, Forbes’ annual study of the top 200 charities for 2010 reported an average of 90% fundraising efficiency and 86% charitable commitment – in other words, for each $1 of donations to the charity 77 cents went to its charitable purpose. Thus, by combining the three ratios above, of the efficiency of the charitable tax deduction, of the percentage of charitable donations that the rich give to the poor and of the efficiency of the charities themselves, you can discover that the $54 billion cost of the charitable contribution income tax deduction results in only about $4.4 billion of benefit to the poor. Not the most efficient use of public money.

Charities are absorbing an ever-higher share of national output. Real charitable revenue increased by 68% in 1995-2005 and charitable donations increased by 68% compared with a 39% increase in real GDP. Apart from charities’ adverse effect on the economy itself, there are a number of reasons why this could be a bad thing:
# The innumerable scams in charitable donations of automobiles and other property;
# The ability of Wall Street hotshots to leverage their social life through “charitable dinners” and other charitable events, a substantial portion of the costs of which are borne by much poorer taxpayers;
# The raucous propaganda and lobbying activities, almost universally in favor of bad public policy, by the charities themselves;
# The uncounted “hedonic” cost to the public as a whole of being subjected to continuous obnoxious fundraising.

Given charities’ averse effect on the economy, their own economic
inefficiency, the great inefficiency of the charitable tax deduction and the disinclination of the very rich to give charitable donations to the poor, it is clear that the charitable deduction should be ended, as should the tax exemption for charities’ income, the tax exemption on their real estate and their other benefits from the public purse. Since excessive charitable activity is economically damaging, such activity should no longer be subsidized by the remainder of the economy.

A major additional benefit of abolishing charitable tax benefits would arise in the management of universities and hospitals. These are basically commercial enterprises that choose non-profit status because of its tax breaks. The removal of the tax breaks should cause most of them to run themselves as profit-seeking businesses, chopping away much of the vast unproductive bureaucracy that they have accreted over the last half century.

Their current non-profit approach, putting political correctness and other shadowy social goals above the efficiency of the enterprise and its benefits to consumers, has wrecked US higher education and caused its healthcare costs to soar uncontrollably. A little free-market sunlight would immeasurably improve them.

While most of the $130 billion saved from eliminating charity tax breaks should go to reducing the excessive federal deficit, some small portion, maybe $20 billion, could be devoted to direct charitable donations by the federal government. If half of that, $10 billion, went directly to the poor it would exceed the $4.4 billion of donations to the poor generated by the charitable income tax deduction. The remaining $10 billion might be wasted, but being public money it would be wasted by representatives of all of us, selected in a democratic manner, and not wasted to subsidize the whims of vulgar plutocrats.

When some leftist billionaire like Warren Buffett calls for higher taxes, or advocates the retention of the estate tax, my blood boils. However worthy the Bill and Melinda Gates Foundation, if as he plans Buffett leaves it a legacy of some $30 billion his estate will pay no estate tax on that amount. That will deprive the Treasury of about $12 billion in revenue, which must be made up by the rest of us, who lack Buffett’s means.

It’s time this subsidization of billionaire social consciences is brought to an end and charities put on the same footing as the rest of humanity. Such a change should boost the US economy, increasing ordinary Americans’ incomes – out of which increase they can, if they wish, make an after-tax contribution to charity, preferably one that benefits the truly disadvantaged.

Ebenezer Scrooge, the true Spirit of Christmas, would rejoice in such a change.

Martin Hutchinson is the author of Great Conservatives Academica Press, 2005). Details can be found at http://www.greatconservatives.com.

(Copyright 2005-10 David W Tice & Associates.)

The Left’s Secession Obsession

December 28, 2010

by Jack Hunter

When a group called the Confederate Heritage Trust decided to hold a “Secession Ball” in Charleston, South Carolina, commemorating the 150th anniversary of South Carolina leaving the union, the event made national headlines. MSNBC host Ed Schultz said, “Conservatives in South Carolina are celebrating the destruction of the United States.” Schultz’s guest, civil rights activist Al Sharpton, said the event celebrated “treason.” Charleston NAACP president Dot Scott said “there’s nothing we can see where there should be a celebration of the Confederacy, not from our vantage point.”

Not surprisingly, each of these liberal critics assumed that only one vantage point need be considered–that of liberals.

The older I get, this “Southern Avenger” has come to recognize and accept that the War for Southern Independence means different things to different people. For generations, many Southerners remembered it with pride as a struggle for independence against a tyrannical government, similar to the American Revolution. Many other Southerners, and particularly black Southerners, consider it a reminder of slavery and the institutional racism that would linger for a century after. Both views contain much truth–and both are inadequate to tell the entire story.

And it is how the Confederacy’s story has been told–and the fact that those who’ve shaped the narrative have been almost entirely hostile to their subject–that continues to bother Southerners like me the most.

For starters, the notion that Southern secession was “treason” is technically true–and about as dumb as calling a father who refuses to report his pot-smoking son to the authorities an “enemy of the state.” When the 13 colonies seceded from England, were they committing treason? British authorities certainly thought so, though the colonists themselves didn’t think of themselves as traitors and neither did much of Europe. Much of Europe would also support the Confederacy.

Secession is a political act, similar in its ends to civil disobedience. Were Sharpton and his fellow 1960s civil rights protesters trying to “destroy the United States” in their struggle to resist an unjust political machine? Many white Southerners at that time certainly thought so. Yet, these so-called “agitators” were actually patriots who understood that loyalty to their own people sometimes meant defying the government. In fighting for the Confederacy, Robert E. Lee declared that his first loyalty was to Virginia, not Washington, D.C. This is patriotism proper, and those who say otherwise have a rather bizarre and perverted view of that term.

Another thing liberals are not quick to admit is the degree to which they seem to have a natural aversion to anything that takes power away from the central government. This sort of big government, quasi-socialist mentality is simply part of their political DNA. Never mind that it has been states’ rights that continue to keep gay marriage legal in some states. Never mind that it is a de facto nullification of federal drug laws in California that keeps medicinal marijuana legally available. Never mind that the most active secessionist movement in the United States today is the left-wing Second Vermont Republic, which seeks a better socialism for the Green Mountain State.

Still, these basic democratic and decentralist principles, championed by everyone from the ancient Greeks to Thomas Jefferson, remain nothing but sinister code words for racism in liberals’ minds. But is liberals’ anti-racism, in this regard genuine? Some of the earliest examples of nullification were states that resisted fugitive slave laws, in which federal law dictated that escaped slaves must be returned to their masters. Eric Foner, a fairly establishment historian with a preference for centralized government, writes of the abolitionists’ states’ rights arguments: “Radicals in some states invoked the Virginia and Kentucky Resolutions of 1798-99, in which Jefferson and Madison had claimed for the states the power to challenge or even override national legislation… . Some Republicans spoke of nullification.” Abraham Lincoln critic and author Thomas DiLorenzo has noted that Foner praises Lincoln for denouncing nullification and upholding the Fugitive Slave Act, which sent escaped slaves back into bondage because it was the “rule of law.”

So was Lincoln pro-slavery? When the Southern states seceded, Lincoln supported adding an amendment to the Constitution that would forever protect slavery under federal law. Lincoln hoped this might coax the South back into the union. Obviously, it didn’t work. So when praising Lincoln today, why isn’t this rather significant detail part of the “Great Emancipator” narrative? Because his admirers prefer to portray a wholly benevolent leader.

When civil rights leaders commemorate the memory and legacy of Malcolm X, the Black Panthers, or most recently the 15th anniversary of 1995′s Million Man March in Washington, D.C., why do they leave out of their celebrations well documented examples of anti-white rhetoric and anti-Semitism? Because they prefer instead to stress the many positive aspects of black nationalism. And they should.

When Southerners commemorate the memory and legacy of their Confederate ancestors by holding a “Secession Ball,” why do they leave out of their celebration slavery and the other negative aspects of that time period? Because they prefer instead to stress the many positive aspects of Southern secession. And they should.

Copyright © 2008 The American Conservative

The Brainwashed as Cannon Fodder

December 27, 2010

by Bob Wallace

“Those who control language, control the perception of reality.”

The United States was…were…originally referred to as “are,” as in, “The United States are a good place to live.” Each state was free and independent. The federal government was a small, fetid backwater in the swamps of D.C.

Sometime after the War Between the States, it became, “The United States is a good place to live,” meaning the federal government was paramount, and the states were no longer free and independent.

Were the Founding Fathers alive today, they would be appalled. Were the average citizens of the late 1700s alive, they too would be appalled. The federal government is about 50 times bigger than they ever imagined it should be. They never imagined an enormous military, crashing around the world, or a Federal Reserve Bank (which is not federal, has no reserves, and is not a bank), or a President who could start decades-long wars without a declaration of war.

Ask yourself this: what good has the federal government ever done? Very little. When you compare the bad it has done to the good it’s not even close. Especially when you take into account the number of people killed by the feds.

The “federal government,” in a sense, does not exist. It’s a group of people—a very small group, merely a handful, who have captured it and use it to serve their own interests. The media and the public schools have taught people that the federal government represents the interests of the entire nation. It doesn’t.

In other words, a mere handful of people have conned millions of people that they, that small handful, are the nation. And mass man, brainwashed sheeple that they are, have marched off to war, become cannon-fodder, and died by the hundreds of thousands. Not for their families, not for their friends, not for their nation….but for a handful of people who have grabbed control of the federal apparatus.

As the twig is bent, so the tree grows. That saying applies to children, who become adults.

Vifredo Pareto, who should be taught in kindergarten, claimed the mass of men are Sheep. The rulers are either Lions, who use force, or Foxes, who use fraud. In a nutshell, nearly everyone is one of the Sheep, eaten (literally) by Lions and Foxes. And most of the time, the Sheep stick their heads into the mouths of the Lions and Foxes! Unbelievable.

Here’s what we’re taught: Things should be top-down, federal government on top, down to the individual at bottom. The Lions and Foxes are the ones who count: the Sheep are expendable.

The way it should be: things should be bottom-up, individuals and families first, then neighborhoods, counties, states, nation. The federal government, the Lions and Foxes, should be absolutely last, never to be trusted. They should know they can easily be hung by their heels, like Mussolini.

The federal government has now become a behemoth, a Blob, a Black Thing that interferes in the intimate life of everyone.

You can no longer trust the public schools or the mainstream media. How many times have any of them told people their very worst enemy is the federal government?

Here’s what else we are taught: we are good and our “enemies” are evil. Here is good, on our side; there is evil, over there, with our enemies.

The reality: good and evil are a continuum. When we see things as good and evil, we will always see ourselves as good, and those who are not-us as evil. That allows us to scapegoat them, to project all our problems on them, allows us to maintain the fiction of our innocence and goodness, and therefore to dehumanize and murder those Others, thereby getting rid of our problems—even though it never happens that way. What happens instead is war, destruction, catastrophe.

David Frum and Richard Perle wrote a propaganda book, “An End to Evil: How to Win the War on Terror.” In that book, the United States is good; those who disagree with it are evil. That is how simple-minded the authors are.

Both writers see things as top-down, federal government first, as representing the entire nation. They also see good and evil as separate categories, instead of the continuum it is.

Of course, neither of these cowards has any intention of fighting. That’s for the brainwashed sheeple. Their job is to tell people what they are supposed to die for—not family, not friends…but for the handful of people who have captured the federal government. And Frum and Perle, and others like them, see themselves as part of the federal government. To them, your job is to die for their beliefs.

The astonishing thing is the number of people who think they are defending their country when instead they are fighting for the federal government. And I repeat, the federal government consists of a handful of people. Those hundreds of thousands of people are fighting and dying for a handful of people, whose interests are the exact opposite of the citizens.

This is how I see things:

Things should be bottom-up, not top-down.

Good and evil are a continuum.

The federal government does not exist and is instead a handful of people whose interests are opposed to the citizens.

When people become aware of what is being done to them, it cannot be done to them anymore. It’s easy to manipulate people who are unconscious.

Bob Wallace can be reached at: ProfessorBigBrains@gmail.com

Copyright 2010 The Libertarian Enterprise.com

Wikileaks: a Big Dangerous US Government Con Job?

December 26, 2010

by F. William Engdahl

The story on the surface makes for a script for a new Oliver Stone Hollywood thriller. However, a closer look at the details of what has so far been carefully leaked by the most ultra-establishment of international media such as the New York Times reveals a clear agenda. That agenda coincidentally serves to buttress the agenda of US geopolitics around the world from Iran to North Korea. The Wikileaks is a big and dangerous US intelligence Con Job which will likely be used to police the Internet.

It is almost too perfectly scripted to be true. A discontented 22-year old US Army soldier on duty in Baghdad, Bradley Manning, a low-grade US Army intelligence analyst, described as a loner, a gay in the military, a disgruntled “computer geek,” sifts through classified information at Forward Operating Base Hammer. He decides to secretly download US State Department email communications from the entire world over a period of eight months for hours a day, onto his blank CDs while pretending to be listening to Lady Gaga. In addition to diplomatic cables, Manning is believed to have provided WikiLeaks with helicopter gun camera video of an errant US attack in Baghdad on unarmed journalists, and with war logs from Iraq and Afghanistan.

Manning then is supposed to have tracked down a notorious former US computer hacker to get his 250,000 pages of classified US State Department cables out in the Internet for the whole world to see. He allegedly told the US hacker that the documents he had contained “incredible, awful things that belonged in the public domain and not on some server stored in a dark room in Washington, DC.” The hacker turned him in to US authorities so the story goes. Manning is now incommunicado since months in US military confinement so we cannot ask him, conveniently. The Pentagon routinely hires the best hackers to design their security systems.

Then the plot thickens. The 250,000 pages end up at the desk of Julian Assange, the 39-year-old Australian founder of a supposedly anti-establishment website with the cute name Wikileaks. Assange decides to selectively choose several of the world’s most ultra-establishment news media to exclusively handle the leaking job for him as he seems to be on the run from Interpol, not for leaking classified information, but for allegedly having consensual sex with two Swedish women who later decided it was rape.

He selects as exclusive newspapers to decide what is to be leaked the New York Times which did such service in promoting faked propaganda against Saddam that led to the Iraqi war, the London Guardian and Der Spiegel. Assange claims he had no time to sift through so many pages so handed them to the trusted editors of the establishment media for them to decide what should be released. Very “anti-establishment” that.

The New York Times even assigned one of its top people, David E. Sanger, to control the release of the Wikileaks material. Sanger is no establishment outsider. He sits as a member of the elite Council on Foreign Relations as well as the Aspen Institute Strategy Group together with the likes of Condi Rice, former Defense Secretary William Perry, former CIA head John Deutch, former State Department Deputy Secretary and now World Bank head Robert Zoellick among others.

Indeed a strange choice of media for a person who claims to be anti-establishment. But then Assange also says he believes the US Government version of 9/11 and calls the Bilderberg Group a normal meeting of people, a very establishment view.

Not so secret cables…

The latest sensational Wikileaks documents allegedly from the US State Department embassies around the world to Washington are definitely not as Hillary Clinton claimed “an attack on America’s foreign policy interests that have endangered innocent people.” And they do not amount to what the Italian foreign minister, called the “September 11 of world diplomacy.” The British government calls them a threat to national security and an aide to Canada’s Prime Minister calls on the CIA to assassinate Assange, as does kooky would-be US Presidential hopeful Sarah Palin.

Most important, the 250,000 cables are not “top secret” as we might have thought. Between two and three million US Government employees are cleared to see this level of “secret” document, [1] and some 500,000 people around the world have access to the Secret Internet Protocol Router Network (SIPRnet) where the cables were stored. SIPRnet is not recommended for distribution of top-secret information. Only 6% or 15,000 pages of the documents have been classified as even secret, a level below top-secret. Another 40% were the lowest level, “confidential”, while the rest were unclassified. In brief, it was not all that secret. [2]

Most of the revelations so far have been unspectacular. In Germany the revelations led to the removal of a prominent young FDP politician close to Guido Westerwelle who apparently liked to talk too much to his counterpart at the US Embassy. The revelations about Russian politics, that a US Embassy official refers to Putin and Medvedev as “Batman and Robin,” tells more about the cultural level of current US State Department personnel than it does about internal Russian politics.

But for anyone who has studied the craft of intelligence and of disinformation, a clear pattern emerges in the Wikileaks drama. The focus is put on select US geopolitical targets, appearing as Hillary Clinton put it “to justify US sanctions against Iran.” They claim North Korea with China’s granting of free passage to Korean ships despite US State Department pleas, send dangerous missiles to Iran. Saudi Arabia’s ailing King Abdullah reportedly called Iran’s President a Hitler.

Excuse to police the Internet?

What is emerging from all the sound and Wikileaks fury in Washington is that the entire scandal is serving to advance a long-standing Obama and Bush agenda of policing the until-now free Internet. Already the US Government has shut the Wikileaks server in the United States though no identifiable US law has been broken.

What is emerging from all the sound and Wikileaks fury in Washington is that the entire scandal is serving to advance a long-standing Obama and Bush agenda of policing the until-now free Internet. Already the US Government has shut the Wikileaks server in the United States though no identifiable US law has been broken.

The process of policing the Web was well underway before the current leaks scandal. In 2009 Democratic Senator Jay Rockefeller and Republican Olympia Snowe introduced the Cybersecurity Act of 2009 (S.773). IIt would give the President unlimited power to disconnect private-sector computers from the internet. The bill “would allow the president to ’declare a cyber-security emergency’ relating to ’non-governmental’ computer networks and do what’s necessary to respond to the threat.” We can expect that now this controversial piece of legislation will get top priority when a new Republican House and the Senate convene in January.

The US Department of Homeland Security, an agency created in the political hysteria following 9/11 2001 that has been compared to the Gestapo, has already begun policing the Internet. They are quietly seizing and shutting down internet websites (web domains) without due process or a proper trial. DHS simply seizes web domains that it wants to and posts an ominous “Department of Justice” logo on the web site. See an example at http://torrent-finder.com. Over 75 websites were seized and shut in a recent week. Right now, their focus is websites that they claim “violate copyrights,” yet the torrent-finder.com website that was seized by DHS contained no copyrighted content whatsoever. It was merely a search engine website that linked to destinations where people could access copyrighted content. Step by careful step freedom of speech can be taken away. Then what?

[1] BBC News, “Siprnet: Where the leaked cables came from”, 29 November, 2010.

[2] Ken Dilanian, “Inside job: Stolen diplomatic cables show U.S. challenge of stopping authorized users”, Los Angeles Times, November 29, 2010.

F. William Engdahl is Author of Gods of Money: Wall Street and the Death of the American Century and Full Spectrum Dominance: Totalitarian Democracy in the New World Order. His other books include Seeds of Destruction: The Hidden Agenda of Genetic Manipulation and A Century of War: Anglo-American Oil Politics and the New World Order.

Copyright 2010 Voltairenet.org.

A Secessionist Christmas

December 25, 2010

Today is Christmas Day. Boy, do I have a firm grasp of the obvious. But I thought I’d write something you could use today.

In the story of the birth of Yeshua ben Yoseph found in the Gospels, you’ll find the visit of the Magi. The modern nativity crèches show the Magi in attendance at the birth, but it was probably months later when these fellows showed up. These men presented the family with expensive gifts…gold, frankincense and myrrh. I get the gift of gold, but what are the other two gifts? And why would they be considered valuable gifts?

Frankincense is a fragrant gum resin obtained from the Boswellia trees — that grow in Abysinnia and Somalia in Africa, southern Arabia, India and the East Indies. Frankincense is produced much the way rubber is produced…by cutting the bark of the tree and allowing the resin to ooze out. Once collected, it burns easily and gives off a balsam-like fragrance, and was widely used in worship.

Myrrh, also a fragrant gum resin, is obtained by similar methods from
the Commiphora shrubs in Abyssinia, Somalia and Arabia. Their bark and wood have a strong fragrance. Myrrh was one of the ingredients of the holy anointing oil and also of incense. It served as a fumigant in the temple and was a burial spice. In the story of Yeshua’s burial, it says that myrrh and aloes were used to prepare the body.

Because the story says the Magi came from the east, either Arabia or India are the likely homes of the Magi. But trading was common in these valuable products, so the Magi could have been from anywhere east of Israel, simply bringing the gifts with them.

So, if you want to give a gift that will make the house smell nice, give frankincense or myrrh.

For the people you REALLY care about, forget trinkets, electronics, clothing, games…everything that gets old, breaks down and depreciates.

Give gold or silver to the ones you love. I suggest silver first, since it’s more affordable.

You can buy gold coins as small as one-twentieth ounce. Silver coins come in common sizes of a half-ounce or a full ounce. Only buy coins of 99.99% purity. Do not buy coins that are collectable, because collectibility means nothing when the coin is being used as money.

Think about your gift-giving like this: Would your rather give someone a gift that grows old and loses its value, or would you rather give someone a gift that will appreciate in value over time? Sure, costume jewelry looks nice, but is worthless when that person is trying to trade it for food.

When the sh** hits the fan (SHTF) and the economy dies, the people you love will need hard money to survive. Maybe you can’t support them, but you can at least give them gifts of true value rather than junk.

Then, when you give them precious metals, and they flash a weak smile and thank you, you can tell them about the impending economic collapse and why state secession is the only real workable solution for individual liberty and property rights.

Beats the hell out of drinking spiked eggnog. Wait…let me think about that.

Secession is the hope for mankind. Who will be first?

DumpDC. Six Letters That Can Change History.

© Copyright 2010, Russell D. Longcore. Permission to reprint in whole or in part is gladly granted, provided full credit is given.

The Day Of Reckoning

December 24, 2010

The CBS info-tainment program “60 Minutes” ran a piece last Sunday entitled “The Day of Reckoning.” The subject of the segment was the imminent and unavoidable default by as many as 100 American municipalities that is expected in 2011.

100 municipalities in default. 100 governments declaring bankruptcy. 100 governmental entities that cannot continue operating. These could be states…counties…cities. The segment featured Illinois and New Jersey among others.

60 Minutes has been a reliable propaganda outlet for government over the last 40 years. So, if they ran this piece on national television, the chances are pretty good that the situation is much worse than shown.

If you have been a regular visitor to DumpDC.com, you’ve seen article after article telling you the various ways that the American economy will meltdown. One of the ways we’ve showcased is the amount of foreign debt that Washington has sold globally, and that DC cannot pay. But here is yet another source of disaster that cannot be avoided, and this source is here on our own shores. This source…municipal debt defaults…WILL happen in the coming 12-24 months.

Think about this situation. What do you think will happen in the bond markets when one state, or big city, or big county…defaults on their municipal bonds? What will the bondholders do before the default…that is, if they know about the coming default? What would YOU do if you were holding an IOU from a friend, and you knew that the friend was going broke? Would you take pennies on the dollar from your friend as settlement of the IOU? Would you try to sell the IOU to some other fool without telling him that your friend was going broke? Or, would just wait until your friend was broke, and his IOU became worthless, and you got nothing in repayment of the debt?

Those are some of the decisions boldholders will be forced to make in the coming months. Further complicating their decisions is that other bondholders can and will make the wrong decisions that will affect everyone’s holdings.

Many bondholders are big pension funds, insurance companies, mutual funds, banks….all the institutional investors out there that used to look to municipal bonds as safe havens for wealth preservation. But there are also millions of individuals holding municipal bonds in their private portfolios for the same reasons. Bond defaults will mean that interest income ceases. So the big investors lose their arses and the individuals do too. But remember…the big losses could affect the entire bond market. It could even cause it to collapse. And the collapse of the domestic municipal bond market because of these government defaults can easily collapse the entire economy.

The municipalities will look to Washington for help. Washington only has a couple choices here. (1) It can print more money and bail out the municipalities to the tune of $1 TRILLION dollars. Or (2) it can tell them that they are on their own. Printing more money will hasten the hyperinflation already on the horizon. Choice #2 is the wise choice, but when in the last 150 years has Washington done anything wise?

Ladies and Gentlemen, please remember that even states that might secede…like Texas…are likely facing these grave bond defaults. So does anybody get out of this scenario unscathed?

Answer: Only the states that have not been mismanaged. I do not know if such a state exists in the USA.

Take the time to view this video with your children.

The Day Of Reckoning

Secession is the hope for mankind. Who will be first?

DumpDC. Six Letters That Can Change History.

© Copyright 2010, Russell D. Longcore. Permission to reprint in whole or in part is gladly granted, provided full credit is given.

Chinese Chess

December 23, 2010

by Irwin M. Seltzer

(Editor’s Note: Here is a major media right-wing Republican publication that sees China’s ascendancy as inevitable. The author observes many of the same phenomena I did in yesterday’s article. But he comes to the wrong conclusion in his last paragraph. He tries to hold that there is still time for Washington to fix its own ills. But DC has neither the political will nor the stomach for draconian spending cuts in the Federal budget coupled with real downsizing of the Federal Government. Washington will be swept into the ashbin of history, and so too the “American Experiment.”)

The Chinese are playing grandmaster chess against an amateur America that can’t see beyond the second move. In a bipartisan display of geopolitical obtuseness, America continues its historic trade policy: It’s free trade, except occasional lapses into protectionism when a whinging constituent must be placated, with a reliance on the World Trade Organization to settle disputes (and believing it has won something of significance when the WTO sides with it in a dispute over such a key product as cheap tires). Occasional public complaints about China’s persistent undervaluation of the renminbi, but refusal to declare the regime a currency manipulator. And conferences, conferences, conferences. All very 20th century.

China is doing a very different thing. The Communist regime sees trade policy as merely one weapon in a war aimed at overtaking the United States as the world’s preeminent economic and, by extension, military power. The undervaluation of the renminbi is a necessary means of keeping China’s export machine running at full tilt so as to create jobs for the millions who are moving from the country to the nation’s cities. Lacking democratic legitimacy, the regime’s principal claim to the loyalty, or at least the submission of its people, is its ability to provide jobs and a rising standard of living, doubly important in this period of transition to a new generation of leaders in 2012. Americans chortle: that mercantilist program of subsidizing exports cannot be sustained forever, as the inflow of dollars will sooner or later trigger inflation. Right: indeed, that is already happening, and forcing the regime to adopt a variety of measures to curb credit and inflation.

But largely irrelevant in the longer term on which the Chinese are focused. By the time the Chinese decide they will have to allow the renminbi to appreciate, they will have accomplished two long-standing objectives. First, their vaults will be stuffed with an even larger hoard of American IOUs, enough to give them an important influence over U.S. foreign policy. “How do you deal toughly with your banker?” asked Hillary Clinton of the then-prime minister of Australia, Kevin Rudd, at a luncheon last year. His answer is not recorded.

It is true that if the Chinese start to dump U.S. Treasuries and dollars, the value of their own piles of dollar-denominated assets would decline. But if the broader geopolitical objective were served, that would merely be a cost to consider as part of the military budget.

Second, by then the Chinese will have copied enough American and Western technology to be in less need of an undervalued renminbi—they will have made-in-China products that can dominate world markets even if their currency approximates its market value. The camels that trod the old Silk Road laden with spices and porcelain will have been replaced with air and sea freighters hauling solar panels and all sorts of goods based on copied technologies and purloined intellectual property. To cite just one example, the high-speed trains that China is now selling worldwide are based on technology brought to China by French, German and Japanese companies.

Every deal to tap the vast Chinese market comes with a requirement that they turn over their technology to the Chinese: nuclear plants, green energy products, autos will be made by American companies in China –until the Chinese complete construction of their copycat plants. The initial orders satisfy the American executives, their eyes focused on the next quarterly report. The Chinese, their eyes focused on 2020 and beyond, know that the technology in hand, they can duplicate the factories and techniques needed to dispense with the American capitalists. Westinghouse Electric recently turned over 75,000 documents to its Chinese customers as the initial part of the technology transfer to which it agreed as part of a deal to sell four nuclear plants to China. Nothing seems to have changed since Lenin observed, “The capitalists will sell us the rope with which we will hang them.”

Consider, also, solar panels, a product that demonstrates the difference between Chinese and American attitudes. The Chinese agree with President Obama about one thing: solar panels are an increasingly important product and source of jobs. The main raw material is polysilicon, and when its price soared the Chinese made it a national priority to replace foreign supply sources. Government money was marshaled and, more important, the permitting process was short-circuited so that plants could go from ground-breaking to full production in a bit over a year; in the West that is a multi-year process. Result: China controls half the world market for solar-power equipment. In a demonstration of what many now take to be the superiority of state over market capitalism, the Chinese created this and other industries from scratch—and quickly.

There is worse. While Barack Obama and American supporters of free trade are congratulating themselves on negotiating a trade deal that will enable American carmakers to sell a few more cars to South Korea, the Chinese are establishing themselves in Africa, South America and the Middle East so as to lock up supplies of minerals, oil and food. The regime has already demonstrated that these moves on the world’s chess board are about more than money and trade balances. Offend them with some move on the world chessboard that does not suit them, and they ban the export of rare-earth minerals crucial to the manufacture of myriad products. Their control over the world’s supply—reports are that they control 95 percent of available supplies and are buying up undeveloped resources in Africa—is in part due to their willingness to bear the high environmental cost associated with the processing of these minerals in order to reap the benefits of control over the manufacturing output of Japanese and Western countries. American liberals and greens prefer a more pristine environment.

Still another problem is the difference in attitudes towards foreign investment. American policy discourages foreign investment by attempting to raise taxes on foreign earnings. Meanwhile China, having already invested massively in resource rich African countries such as Sudan, is turning its attention to Latin America. In Argentina alone China’s state-owned and subsidized companies have invested in oil and gas properties: copper, gold, silver and lithium mines; lands for soya production; and in port development to facilitate the large-scale shipment of these resources to China.

Then, of course there is India, a giant democratic country growing at a pace equal to or faster than China’s, and now the prize in the 21st century version of the Great Game. Barack Obama and an enormous trade delegation visited India and returned to trumpet success in working out trade deals worth an estimated $10 billion. This week Wen Jiabao, China’s premier, played one-upmanship and booked $16 billion in deals, financed by China’s banks, and announced he would open China’s markets to Indian goods as part of a plan to double trade between the countries to $100 billion annually by 2015.

Even more important are two additional factors, one economic, the other military. Beijing has its eye on the dollar. Not the jiggles in its value, although it complains about the threat QE2 poses to the value of the dollar and therefore to its dollar-denominated holdings. But on replacing the dollar as the world’s currency of choice. Countries can now invoice and settle trade deals in renminbi, which more and more will do as China gradually makes the currency more easily convertible. Economists at HSBC are guessing that within three to five years half of China’s trade with developing countries—that trade accounts for 55 percent of all of China’s trade—will be in renminbi, compared with 3 percent at present. No need for dollars.

Then there is the military consequence of all of this. China is becoming increasingly aggressive in asserting its territorial claims to the Senkaku Islands, now controlled by Japan, and to territories claimed by Vietnam and others in the South China Sea. It is building submarines and aircraft carriers and modernizing its navy, cyber-warfare capability, missiles, and anti-satellite weaponry. No surprise that Australia and other nations in the Asia-Pacific region are reviewing their policy of relying on America as a force capable of imposing stability on their region.

But there is good news, news that trumps all of these problems. Lawrence of Arabia, at least according to the David Lean film, countered Arab belief in inevitability with the retort, “Nothing is written.” So it is in the Sino-U.S. jockeying for supremacy. America remains the source of most of the world’s innovations and the home of most of its great entrepreneurs; unlike China, America is blessed with a relatively young population; bright Chinese still prefer to be educated at great American universities, and the American Dream remains a magnet for risk-takers looking for an opportunity to move up in the world; the American military is still the most potent in the world; and this nation is blessed with an abundance of natural resources. There is time to fix things: “The Chinese currency is still a long way from replacing the U.S. dollar as the world’s reserve currency,” writes Chi Lo, CEO of HFT Investment Management in Hong Kong. All that is missing are sensible policies. And it truly is not written that we will continue to pursue the self-destructive policies of recent years.

© Copyright 2010 The Weekly Standard LLC

The Young Chinese Tiger and the Old Sick American Lion

December 22, 2010

Watch any PBS program about how lions live on the African savannah. The dominant male lion rules over a pride of females and their young. As the young males mature and the ruling male ages, eventually one young lion will supplant the old lion as the leader of the pride…and life will go on.

In this article, we see that the males in the American lion’s pride…the nations of Europe and most of the West…are as sick as he is. So none of the other males will be wresting control from the old lion. But there is a young tiger quietly and cunningly rising to world leadership. That tiger is China.

The futures of China and the United States of America are inextricably linked over the next decade or two. But China is on the ascendancy as a world power, while the USA is hurtling toward the abyss of self-inflicted financial ruin and historical obscurity.

I referred to the “young” Chinese Tiger in the title for a reason. China is certainly a nation that has been a nation for thousands of years. And its political leadership has been under the Communist banner since Mao Zedong helped found the People’s Republic of China in 1949. But China’s recent embrace of capitalism began in 1978 under Deng Xiaoping. So, the economic reforms that have transformed China into the world’s leading economy are scarcely 32 years old. So the tiger that is beginning to strut the world is a young China. And America is the old, sickly, tired lion, still trying to assert his leadership with his hoarse, weak roaring.

And why is China ascending?

• The Chinese economy is growing at a rate of 8% annually. At that rate, it will double every 9 years.
• 330 million people speak English, more every day.
• The US has 300 million people, China has 1.2 billion.
• The US personal savings rate is zero. China’s savings rate is 34%.
• Beijing is encouraging Chinese people to buy gold. Washington is encouraging Americans to spend, spend, spend.

Look what has occurred in the United States over the last 32 years. In 1978, the Federal Government had a surplus of $55.4 Billion. Today, the Federal budget cannot really even be calculated. The part of the budget Washington will admit to is north of $3.834 TRILLION for the 2011 fiscal year. And don’t forget that there are untold billions of dollars being spent “off-budget” that Washington never tells us about. Washington now only makes a pretense of appearing to care about its future solvency and viability. And while DC pretends to care, it runs the printing presses over at Treasury and “monetizes” its budgets with counterfeit currency.

Washington has been able to spend profligately and mismanage its economy through the recent decades by also selling US Treasury bonds to China (and other nations). And because the American political system is entirely driven by the desire for re-election, no long-term strategies appear to have been DC’s lodestar. Not so with China. As their holdings of US bonds have increased, so has their hidden control of Washington. Yet, true to the Oriental culture, China patiently puts up with American bluff and bluster in regard to important issues between the nations.

One question for the future is this: How long will China stand by while Washington makes China the scapegoat for many of DC’s own ills? Anyone who observed the congressional hearings about how Google was being censored in China saw Chinaphobia on parade, as congress critters railed against the very censorship that Washington now pursues for itself. Washington’s rhetoric against China will likely escalate as politicians seek to blame all but themselves for America’s economic woes. Chinese forbearance will be sorely tested by DC’s war of words and at some point Beijing will move to end it.

A big media story last week was about the Nobel Committee ceremony, where Chinese dissident Liu Xiaobo was awarded the 2010 Nobel Peace Prize in absentia. The holier-than-thou media tried its best to embarrass Beijing for its refusal to allow Xiaobo to accept the award. But it occurred to me that in 1980, President Carter issued a boycott of the Summer Olympic Games because the Soviet Union was engaged in a war in….guess where? Afghanistan. I guess selective outrage has no memory.

The US Dollar has been the world reserve currency since the end of World War II. You would think that any nation whose currency had attained reserve status would be jealous of that status, and would do all it could to maintain the solvency and reputation of that very currency. But not DC. Through its use of inflation and fractional reserve banking, it has defrauded the entire world…while recently accusing the Chinese of being a “currency manipulator” nation. That Beijing refuses to inflate its money under DC pressure should bring embarrassment to DC, not Beijing. Like your mom said: If all your friends decided to jump off a cliff, does that mean that you should, too?

Washington is so myopic about the DC-Beijing connection that it scarcely notices that Beijing is consolidating its position around the world. Examples are:

• Establishment of BRIC, consisting of Brazil, Russia, India and China, representing 40% of the world’s population
• Deals with Canada for the Athabasca shale oil
• Deals with Russia on a basket of raw materials
• Oil and natural gas pipeline deals with Middle East producers
• Reducing exports on rare earth metals, crucial for technology applications (China produces 97% of world rare earths)
• Deals with South Africa and Brazil on iron ore and steel production
• Deals with African nations on oil production
• Recent announcement that China would begin producing airliners in China to rival Boeing and Airbus and serve its own needs
• And many many other deals

Both countries engage in mercantilism, the promotion of national interests by protectionism through subsidies and tariffs. The easiest way for American politicians to act is through protectionism and scapegoating. But because Washington is broke it cannot subsidize much more than it already has…not that it should. China’s pockets are deeper and they have proven willing to “play chicken” with DC on subsidies.

And recently, the Obama Administration announced big tariffs against Chinese tires. This is tantamount to pissing on the shoes of your banker. Seems to me that the banker might take exception to that gesture and respond how bankers retaliate…with financial sanctions of their own.

Make no mistake about this. Both Beijing and Washington know that Beijing holds the DC cojones firmly in its hands. When your banker holds almost $1 trillion in your notes, he controls you. China is slowly and carefully divesting itself of some US Treasuries in an effort to minimize their losses. They know how tenuous Washington’s financial situation is, and that some other nation could cause the collapse of the American economy. But Beijing also knows how strategic their US bond holdings are. They know that they control economic, political and military policy between America and China now, and that is a position that they will not relinquish while it serves their interests.

Washington should be grateful that China was its banker over the last 30 years. But like the old saying goes, “Nothing ages faster than gratitude.” Gratitude can quickly turn into resentment, and resentment to hostility.

The relationship between Washington and Beijing is only going to worsen and continue to sour. Just like the old lion is hostile to the upstart cub who challenges him for supremacy, so too will Washington increase its hostility to Beijing, even though Beijing already owns Washington. Sooner or later, Washington will either collapse under its own weight or outside forces will cause its collapse.

On the savannah, the young lions all know when the strength of the old lion is passed. When the old lion dies, the jackals and vultures come to pick his carcass clean. Sometimes, even the young lions feed on the carcass. Much the same is in store for the USA.

Then the Chinese Tiger will begin its long reign as king of beasts.

Have you called Rosetta Stone and ordered your set of Mandarin Chinese language tapes yet? Better get moving! I already have mine.

DumpDC. Six Letters That Can Change History.

© Copyright 2010, Russell D. Longcore. Permission to reprint in whole or in part is gladly granted, provided full credit is given.