Unintelligent Design in the World Economic System and the Economic Path Downward.

Abstract: The nostrum that government can intelligently design an effective social program is refuted. The government is usually mesmerized with the quest for ‘equality’ and ‘justice’ in a system where, for reasons of human conduct and variances in cognitive skills and other attributes and more, cannot exist. No members of any population can handle their resources homogeneously.  The solution of government is always to tax and then attempt to redistribute the wealth and this fails because people cannot equally manage money or assets or small segments of society and the system will soon revert back to its approximate original state.  The attempt t0 force an equitable distribution of monies and wealth among the polis eventually metamorphoses into a two-tier wealth system where we eventually observe two categories:  the ‘smart money’ and the ‘less–than-smart’ money. Thus any distribution will self-correct and redistribute according to certain metrics not possessed equally by all in the masses. The rich will again become rich and the poor will find their proper place in the economic ladder.  The inept will lose their temporary political gift of money. The fuzzy notion that ‘education’ will allow the masses to understand how to function so they can join the successful  members of society must be refuted since  using all examples where massive funds are spent on education and the social system still  remained unbalanced. California is an example of how education has no positive effect on their society other than political indoctrination.[1] Their lousy educational system could not teach their citizens how to read mortgage contracts or mange their credit. The concept of an intelligent design for society  is merely  a ruse that transfers power to  certain political entities that use the acquired wealth for their own benefit thus fulfilling the Trotsky prediction that the his government would become an elitist club which  would collect the wealth for themselves and  would act exactly like the capitalists they denounced.  The Soviet government comprising only 4% of the population controlled and enjoyed nearly all the wealth and lived in splendor. Government is never the solution and is nearly always the problem.  We now see the leftist elite coming to power in our country and the size and brutality of government will increase as it always does in authoritarian systems.

This is economic war so we have to defend ourselves in economic/military terms: pull your money out of certain banks [Citi and BoA] controlled by the government, avoid taxes and do not buy products or services endorsed by the government.   Do not buy GM or Chrysler products. Do not vacation in California, MA, New York or other places controlled by leftists. Do not order products and services over the Internet from businesses closely associated with leftist politics.  This is now a global economy so moving away for the US may soon become a viable option. Capitalism thrives everywhere it is tried and new spots for investments and profits will spring up if the US crashes into a socialist heap of unmanageable debt.  Be prepared to act.

Government grabs and holds wealth and power first and last.

One of the main follies in the human process is that workable ideas and social systems cannot work effectively for everybody so the necessity to redesign or improve the existing system draws power and strength from the dissatisfied.  When given a chance to vote, the lower classes always strive to vote money for themselves.[2]This process proceeds even though the disgruntled may become worse off from the effects of the new design. The solution thus, monotonously, becomes an urgent need for more government.  When we hear that we must ‘do something for the people,’ the people, whoever they are, eventually absorb the full brunt of the failure from this ‘something’ and suffer from starvation, government, poverty or disease. Part of this frantic quest for alternatives to proven viable economic and social systems has produced disasters like the French Revolution^[3], the Russian Revolution, the Great Proletarian Cultural Revolution^[4]  and many others. Many of the citizens of these movements fell under programs like The Reign of Terror^[5], Dekulakization^[6], The Russian Purges,^[7] the famine in the Ukraine known as Holodomor (Ukrainian: ????????? translation: death by starvation)^[8] and events such as in the sadistic genocide of innocents by Pol Pot and the Khmer Rouge political party in Cambodia[9], There are too many examples of this madness to even list by title. So, the quest for power and wealth by political operatives goes on under new names, the current one being ‘economic stimulus’ or, in my wording, unintelligent design.

In most of these cases above, society was not exactly perfect for all, but the loss of so many dozens of millions of lives from 1900 to 2000 prompts us to believe that there was really nothing good accomplished in all these efforts.  Certainly fewer would have starved than died in the bombs and on the firing lines. These are examples of raw and indecent quests for power by grabbing the land and assets of others for the reasons of selfish and maniacal lust and wasting those assets in a firestorm of hunger, murder, disease and war [51 million in WW1 and 31 million in WW2 alone]. The leaders of these political operations were too competent to be labeled as clinically insane so they were mostly greedy sadists and fanatical egoists. Competition for power produces disasters like we saw in Rwanda[10] and Zimbabwe.[11] And we thought the Romans, Mongols, Huns and Moors were vicious.

Politics is war and conversely

The examples above are extreme but can be used to proscribe the outer boundaries of how far ideologies can push people into the grave. There are other variants of this political lust for power that are confined to monetary matters rather than to piles of skulls or furnaces filed with ashes or the stark visions of ossuaries that hold the unsorted bones of millions who died in massive world wars in Europe. If we merely subtract the actual firepower from examples above, we can view the extract as a series of similar military actions suddenly isolated to act as strict political processes that are strikingly like the military operations above.  Paraphrasing and repackaging Clausewitz,[12] we find that war is politics and conversely. We see the same contentious arguments, insults being hurled, corruption, and concentration of forces and media bias [propaganda and veiled stoogery] as during real wartime limited only by the absence of dead bodies littering the landscape. The causalities are our bank accounts and equities. Here, the quest changes  from the direct conquest of strategic geographic locations  and  is now redirected toward the aggressive seizure of  wealth and other  proceeds by so-called democratic means  and the justification for conquering money versus land  is invariably a ‘redistribution’ of such wealth to be ‘spread around’ so as to benefit us all. This is economic war conducted by political means. This is politics conducted by economic means.

What we have viewed recently in this Herculean $787 billion spending spree[13] by Congress was the equivalent military version of the Blitz where tax monies were frantically being assigned to new social programs behind closed doors and those elected officials who voted for the measures did so almost entirely by party lines and the losing party had no inputs.  This massive abuse of power and can be viewed as some form of putsch or power grab. Such actions were seen in the past in mostly totalitarian governments and in places like the Politburo.  Corresponding to the Soviet System, Nancy Pelosi[14] [and other leeching reptiles[15]] becomes some High Commissar and constructs ‘legislation’ in secret is the contents are unknown even after the ‘vote’ in the House is conducted. Indeed, those who did vote for the massive spending had no detailed knowledge of what was actually in the bulk of such a transfer of wealth. There was not enough time for any reasonable person to digest 1100 pages of legislative paper in such a short time. The impetus for this was fear mongering designed to enhance political power. We had to do something ‘quick’ or something worse might happen. This piece of negative logic serves well in mob scenarios, fires in public places and muggings in Central Park.

To follies like this we can assign the label Unintelligent Design.

In military terms, this massive spending thrust is equivalent to your forces overrunning the enemy and then suddenly running out of supplies and being forced to forage and scrounge for the basics. Since the weapons are not blades or axes but dollars, we wonder where the dollars might come from. The current battle ground is based on jobs, or the lack thereof:

“High unemployment rates, especially among young workers, have led to protests in countries as varied as Latvia, Chile, Greece, Bulgaria and Iceland and contributed to strikes in Britain and France.”[16]—NYT Business Job Losses Pose a Threat to Stability Worldwide

“Robert Rector, a prominent welfare researcher who was one of the architects of Clinton's 1996 reform bill, warned last week that Obama’s stimulus plan was a “welfare spendathon” that would amount to the largest one-year increase in government handouts in American history.

Douglas Besharov, author of a big study on welfare reform, said the stimulus bill passed by Congress and the Senate in separate votes on Friday would “unravel” most of the 1996 reforms that led to a 65% reduction in welfare caseloads and prompted the British and several other governments to consider similar measure”[17]--Obama warned over ‘welfare spendathon’ The new administration's economic stimulus plan may undo reforms that cut the dole queues, critics say.

The unemployed, particularly those of marginal cognitive skills or those who are drug dependent, might choose more welfare over the drudgery of work. Why not? The Welfare Reform Act was the only successful restructuring of a major social program in our history and now we might get it back with more poor people on the rolls including millions of illegal aliens.

But, now, getting back to the military analogy, we then must think about the equivalent of ammunition to fight this war and that is money. Money derived by taxation is falling as the GDP is falling so we are forced to do what? Barrow? Run the printing presses? The world is going broke, China is crashing, Japan is stagnant so from whom do we barrow? Ourselves!?

Global financial meltdown

The International Monetary Fund [IMF] is broke and Japan, of all people, has just pledged $200 bln.[18] Things are really rough if the mercantilists are throwing their much-needed reserves into the world pot as ‘"second wave" of countries will soon fall victim’ to the financial holocaust.[19]  This certainly means Poland and Hungary and probably Ireland and even England. This is equivalent to a world war that uses debt and packed mortgages as the primary weapons of destruction.  A few trillion dollars of deftly directed toxic assets will sink banks faster than the Turks sank British dreadnaughts in the Bosporus.

This novel warfare was derived from the unwarranted use of credit to extract wealth out of rising real estate prices. The reverse process works just as well. We saw this begin in Japan in the 1990s with rapid decline in the Tokyo Real Estate prices, stagnation in their economy and a drop in the Nikkei average from about 30,000 to the current 8,000. This spread to Argentina and Sweden and most of the world. China’s industrial heartland along the Yangtze River valley is collapsing. The world’s major economies are contracting more than 6%.[20]

Losing the economic war to massive debt

This novel war now has the industrial world in a shoulder-to-shoulder fight to the economic death against the forces of deflation caused by massive debt. In the midst of this battle, our leader Obama and his Democrats, now have found a way to assist the enemy by spending money we don’t have so as to help destabilize the world’s money supply and encourage first more deflation then massive inflation. If we print money then inflation will soar.  We are fighting a deflationary spiral caused by debt with more debt? [21]Obama sends his diminutive Treasury ‘expert’  Tim Geithner to Italy to tell the G-7 allies in this war that somebody needs to buy up our bad debt of about 3 trillion dollars  while we create some more debt real soon. This is equivalent to an army in a huge battle suddenly burning up its munitions and then declaring a truce. Obama’s economics ‘expert’ Paul Krugman thinks we should spend even more and nationalize the banks. [22]

The Managing Director of the IMF was quoted: Mr Strauss-Kahn, who warned recently that his [IMF] resources could run dry within six months, said: "This is the largest loan ever made in the history of humanity [referring to Japan’s $200bn offer]. They might know, they have struggled with deflation for the last 18 years with little success.  Is this a result of their unintelligent design to handle deflation and stagnation? Certainly so. It didn’t work.

This is unintelligent design

The design of this economic system with its cancerous credit backing is as unintelligent as anything so far constructed in the universe.  Debt, as it now stands, will crush the known world assets and will force the battalions of our army to split up and fight each other in the spirit of protectionism. We have met the enemy, it is debt and we fight debt with more debt. That is really stupid. [23]

But, the war is not over. When countries crash the leftist factions in each unit will want to tell us all that capitalism was at fault and then set up command economies as they did in the USSR and North Korea.  We need a Nobel Prize for Unintelligent Design. I nominate Bear Stearns for the first one. [24]

We are in a economic and political war zone where the assets of many of us will be wiped out for the cause of creating another ‘Great Society.’ If we do nothing, the government will attempt to own everything and control even the minutest details of our lives. That is how the left operates. The economy clearly cannot support all the socialist programs on the Obama agenda.[25] Obama has declared economic war on us.[26] We must fight back.

rycK

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