What Jefferson thought of English Politics

"The parliament is, by corruption, the mere instrument of the will of the administration. The real power and property in the government is in the great aristocratical families of the nation. The nest of office being too small for all of them to cuddle into at once, the contest is eternal, which shall crowd the other out. For this purpose, they are divided into two parties, the Ins and the Outs, so equal in weight that a small matter turns the balance. To keep themselves in, when they are in, every stratagem must be practised, every artifice used which may flatter the pride, the passions or power of the nation. Justice, honor, faith, must yield to the necessity of keeping themselves in place. The question whether a measure is moral, is never asked; but whether it will nourish the avarice of their merchants, or the piratical spirit of their navy, or produce any other effect which may strengthen them in their places. As to engagements, however positive, entered into by the predecessors of the Ins, why, they were their enemies; they did every thing which was wrong; and to reverse every thing they did, must, therefore, be right. This is the true character of the English government in practice, however different its theory; and it presents the singular phenomenon of a nation, the individuals of which are as faithful to their private engagements and duties, as honorable, as worthy, as those of any nation on earth, and whose government is yet the most unprincipled at this day known."
-- Thomas Jefferson to Governor John Langdon, March 5, 1810
Doesn't this apply to DC insiders now.

Oxymoron

Mr Buffett and Mr. Gates openly lobby others who have amassed great wealth to avoid capital gains taxes and inheritance taxes by donating to a foundation. They also freely espouse paying higher taxes is not only necessary, but the right thing to do... Am I the only one who sees this as an oxymoron?
In Nebraska, Buffett's capital gains taxes @ 7% of $Billion would produce $70Million in revenue and make up much of our budget shortfall.
After capital gains and later, death taxes are paid, foundation donors can still fund their charities only using after tax dollars. Better yet, research promising new industries in the US and fund them. The Bloom box, only one idea, creates electricity using 1/2 the fuel of current methods and is smaller than a dumpster. Americans are full of ideas and have literally changed the world. Investing creates jobs, grows the economy and teaches folks how to 'fish' rather than feeding them for a day. Risk means some winners and some losers, but many jobs.
By shielding their wealth, their dividends and real estate from the tax man, they should know the result is selfishly leaving the rest of us to make up the difference. Isn't the removal of billions from our struggling economy also a problem? Although I have no doubt their goals are unselfish, possibly they haven't thought through the "unseen" [Bastiat] lost benefits of added production, growth in the economy, job creation and worker independence that could have developed.
Mr. Buffett and Mr. Gates, the least you can do is offer to drop your Foundation's tax exempt status to show you are sincere and do desire to pay a fair share of taxes.
Sent to the hill on 12/17/10

WikiLeaks

Dear readers, listen to audio of Naomi Wolf as she warns that TSA and Wikileaks are Master-Slave fights, not Left-Right.

A deeply worried Naomi Wolf, author of The End of America, fears that both TSA actions and the threatened use of the 1917 Espionage Act against Wikileaks founder Julian Assange, a journalist, signal a rapid escalation on multiple fronts toward the end of liberty for all of us. Historically, the state always uses the excuse of national security as a tactic to subjugate citizens, forcing nakedness and sexual intrusions upon us, unless and until, courageous acts of resistance and mass opposition finally force these totalitarians, like the TSA, to back down. But we must act if we are to have a chance.


I love smart people who see past the rhetoric. This post from a Fox News from daisypug about WikiLeak's insurance file of unredacted data which exists to be 'unlocked' if they are shut down.

One of the stated goals for the release of the diplomatic cables is to expose American hypocrisy about freedoms of the press and speech. They chose to work with certain companies, like Amazon, specifically to show how quickly the government will demand censorship and how easily those corporations do cave. The U.S., Australian, and even Canadian governments have shown themselves to be no better than China when it comes to the distribution of information that actually has the power to change how those governments conduct themselves. They immediately start trying to shut down the website by any means legal, illegal, or completely against any sense of American democratic values.

You won't see anything that substantial on televised news, in the failing print publication industry, or even on mainstream websites.

How Cabal of Wall st bankers, federal reserve, & DC get rich

Let's assume you are an everyday guy who has saved 10,000 and buys a savings bond paying 7% interest compounded annually. Your bond would be worth $19,671.51 after 10 years. Your taxes on capital gains of $9,671.51, if you live in Nebraska with 7% capital gains plus 15% federal, would be $2,127.73 leaving you a net gain of $7,543.78 in currency.

Now lets assume inflation (amount of money the federal reserve was creating for the bankers) was at 5% over those 10 years. The amount of money needed to buy the same goods as 10 years ago when you made your investment would be $16,288.95 in currency.

That reduces your actual gain in buying power to $3,382.57 in today's currency. If we subtract the capital gains taxes paid from the actual gain in buying power, your gain was only $1,254.83 and your actual capital gains tax rate was more like 63% on actual gains.

Meanwhile, the banks are receiving federal reserve notes BEFORE the inflation rolls down hill to the pool of existing currency. Is it any wonder the divide between mega-rich and the average person is growing?

Added 12/5/10

The Fed creates all bubbles and inevitable bursting of all of the bubbles, by manipulating money supply & interest rate <<< pass it on.

Although we are all debt slaves to the Federal Reserve's ability to inflate, ballooning student loans-not forgiven by bankruptcy-may violate the Constitution. Many young adults after college are working in virtual 'involuntary servitude' to pay off loans--a clear violation of the 13th amendment. Why are college loans not challenged?

If the Supreme court ruled college loans violated the 13th, at first, fewer would go to college but very quickly colleges would recognize that market forces could put them on the street unless they tighten their belts so tuition could drop. Profs would take fewer paid trips, double up in offices again, and teach more hours. Also, many skills previously learned in technical high schools, might return meaning fewer community colleges classes needed. Think of the productivity from two years of work rather than two years of classes.

Added 1/11/11 A video explanation of paper money.

What causes bubbles?

Matt Taibbi, an author I do admire, has read Cato's take on the housing bubble and written about it here in Rolling Stone. Now I doubt Rolling Stone will pick up on my humble response, but I do have a point or two to make.

• 1) Community Redevelopment Act[CRA] as originally written had nothing to do with the bubble but was a factor in Credit Default Swaps [CDS] as a hedge against loss. Banks were judged on their CRA rating and that 'forced' them to make loans in areas where a trend was showing crime, vacancies and business pulling out made them a bad risk. The buyer wasn't a risk, the house was well constructed, but if the homeowner were injured or lost their job, the home might be worthless on the market. Banks don't print money (Fed reserve aside,) so they cannot make loans of their depositors money except on sound risk.
• 2) After CDS became the norm and pushed off from the mother ship (the banks,) loans became a commodity. If a broker sold a house and wrote the loan for maximum amount, their % of commission was higher and they could actually 'sell' the loan to a CDS broker. This caused brokers to run around making second mortgages in the 10's of thousands on kitchen remodels with no concern that the loans exceeded the value of the home. Again they sold them for % profit.
• 3) On C-SPAN I have had very informed sources answer this question: If Americans were negative savers (because both Greenspan and Bernanke kept interest at 1% which discouraged savings and encouraged spending,) where did the US$s that financed all these risky home loans come from? The normal process is a saver puts money in bank at a certain interest rate and the bank loans that money at a higher interest rate on good solid 'risks' to make bucks.. But, we had no savings. The answer was the federal reserve created the money used to fuel the bubble. Its like a forest fire with lots of downed trees, branches and brush.. it burns very hot and destroys the trees.
  
• 4) So the circle was complete; the bubble grew. Greenspan or Bernanke could have (should have) raised interest rates like Volcher did to let the bubble deflate and give us several good years of growth again. The only way to deflate a bubble is to deflate it--in our case by not printing so much money and raising interest rates. The pain is hard, but its over fast. No Politician wants that. The federal reserve is very much in tune with politics and the administration in power.
• 5) Yes there was greed with flipping homes and some got caught with the hot potato when the bubble burst. There was greed in Goldman and other banks selling a faulty investment. There was greed in the loan makers who would shop the neighborhood to find a home that sold for a huge amount so they could make the loan (and their commission) higher.

Providing equal rights for all

In Public Pulse on Friday

Omaha City Councilman Ben Gray said, "We want to make sure people are protected no matter who they are, where they come from or what they consider their gender to be."
When our Constitution was created, it was earth-shattering. Sovereigns were no longer kings, queens or elite bodies of leaders, but individuals. Each individual had sovereign rights, which we were born with.

In Europe, Marxism worked, as class structure existed. Marxism was not so easy here. We had to be convinced there was no American dream of success with hard work, planning and setting goals. We had to be divided.

Today, we have almost every special-interest group imaginable, from age, color, race, sex, sexual identity, disability, veteran and on and on - divided mostly by groups we cannot choose to leave - I can't be young, male or Hispanic.
Groups now vie for favor of the government to gain their rights - rights we gave away in our fervor to be fair to all.

Separation of School and State

Ezra,

Hotly debated issues on education are created BECAUSE we do not have separation of school and state. Forget separation of church and state==its the schools as political footballs that are causing the quality of education of our kids to be relegated to the bottom of the adults' priority list. I'm listening to the Florida governors debate on C-SPAN and much of their discussion is how to 'RULE' education in their state. Top down cannot work as one size NEVER fits all. Their mortgages are teetering on the edge, says a reporter, but often that mortgage includes hundreds a month for education taxes.

If all schools were immediately unfunded by all level or agency of government, and only funded privately by tuition (or education stamps explained later,) property taxes would plummet, overhead costs at all levels and lobbyist groups would crumble, principals at existing public school buildings would need to negotiate tuition with parents and learn, as private schools do, that all resources must be used in classroom for teaching the kids including the head master. Most children would stay in their current school. The only difference would be the parents being empowered and education of children becoming the primary goal of schools again. I would abolish dept of education and In a five year phase out, have election of parents advisory board done at each school to work with the principal during transition.

What about the poor? Well, I think food stamps pro-rated by income is a good model as a tuition supplement for poor. I would base the amount on an average tuition for the county of residence. After all, we don't care whether grocery stores are owned by Jews, Catholics, Muslims or atheists for food stamps.

Justice Sotomayor's widowed mother worked two jobs to send her daughter to private Catholic school in NYC. In fact, Kagan attended Hunter College exclusive K-12 and Roberts attended Notre Dame K-12. Clinton, GW and Obama all benefitted from private K-12 school along the way. If the Justices who benefitted from private K-12 excused themselves from cases about public schools, how many would be able sit?

Bill & Melinda Gates and Warren Buffett's foundation as well as others interested in education could dive in to assist large city school districts (explaining business practices) during transition. Everything would begin to focus on one issue... only one.. the education of the child.

Certifications would be of no consequence. Either a teacher is teaching or they are not. If a neighbor has decided to stay home to teach their children, taking a hit in their double salary income, that teacher can now accept (for tuition) other children from the neighborhood. In my neighborhood we have an autistic child who could easily succeed with his siblings and neighborhood friends in a small class setting around the kitchen table.

States may decide it is in their interests to test children at set points to identify neglect, and absolutely test to certify 8th grade and high school diploma requirements have been met. Colleges and universities would no longer have to bear costs of the growing number of remedial classes. The ability to sit for annual testing can identify a need for coaching if a child is falling behind. As with college entrance exams, coaching programs will arise from free market.

Trades can once again be removed from community colleges and rolled into a high school focused on the borderline academic, who may be kept in school given the ability to work with their hands part of the day. In Omaha, our former Technical High, where interwoven with their classes, (given the sexism of the times) boys worked on their cars, and girls learned to type and take shorthand, has over 300 non-teaching staff and is being used as the district's headquarters.

The Prussians designed public education to create a class of citizens who respond to orders without question and are trained to endure long periods of boredom. Even the USSR did not fall for that standard. Public Schools are teaching our children that government is their friend and only has their best interests at heart. How many times has that worked out in the past? Was Uncle Joe Stalin a good guy? or Mao, or the politburo?

I say, separation of school and state is our best solution for education in the USA today.

My opinions are my own.. but It might be interesting to hear comments/questions.
Sent to wonkbook@gmail.com Washington Post