Corporations Effectively Have More Rights than You Do on Defamation Suits

 I was interested to read this cite in a report on a situation in which someone accused a corporation of illegal activity:

In Dun & Bradstreet, Inc. v. Greenmoss Builders, Inc., 472 U.S. 749 (1985) the Supreme Court allowed a business to sue a credit reporting agency for defamation where the agency mistakenly reported that the business had filed for bankruptcy.

Restatement Second § 561 Defamation of Corporations states:

“One who publishes defamatory matter concerning a corporation is subject to liability to it

(a)  if the corporation is one for profit, and the matter tends to prejudice it in the conduct of its business or to deter others from dealing with it, or

(b)  if, although not for profit, it depends upon financial support from the public, and the matter tends to interfere with its activities by prejudicing it in public estimation.”

Did you know that "Defamation of Corporations" was an actionable grounds for a lawsuit? And it says "One who publishes". Does that include newspapers, websites, blogs and the like? How about Facebook Feeds? Fact is, it is very hard for private citizens to sue for defamation. Most of us don't have the resources. Big corporations do, so citizen journalists might be deterred from reporting something even if there is reason to think it is true simply because they can be sued for defamation by an artificial government-created entity called a corporation. 

But it goes beyond that. Look at the wording of those statements. We bad-mouth various members of our society, members of other tribes and political clubs and what have you, all the time, in a way that would "interfere" in their activities by "prejudicing it in public estimation." It is hard to avoid the conclusion that on this issue, courts have manufactured the "right" to sue for artificial government-created entities called corporations that is at least equal to your right and mine to do so, but they have much more resources with which to exercise their right! So smart people would be much more reticent to publish derogatory information about them rather than us!

In Localism, a philosophy of government there are thirteen doorways to centralization which must be kept shut in order to maintain a decentralized society. If any of them is left open, you will wind up with an increasingly centralized state regardless of the preferences of the people when the door is first opened. One of these is abuse of incorporation. We can't have a decentralized government when global corporations are free to buy, sell, lobby, and give to PACS without limitation. They are going to push for centralization every time and for us to be free (which requires political decentralization) they must be bound. 

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There is Never a "Legitimate Winner" of a National Election Under Hyper-Centralized Government

 In 1787, the newly freed states of the American Confederation had a debate on whether they should adopt the proposed constitution which would make them truly one, albeit federal, nation. James Madison, soon to be our nation's second President and leading proponent of the Federalist side, "sold" the public on the idea of adopting the constitution. He did this by making the now-famous claim that under the proposed constitution the powers delegated to the federal government were "few and defined" while those powers "left to the states" were "numerous and indefinite."

I ask you citizens, is this the kind of government we have? The truth is that each generation of Americans are living under a "federal" government that is more centralized than the last, regardless of how they voted. The national capital has, like dung draws flies, drawn to itself from all corners of our vast nation those with aberrant personalities who have a perverse compulsion to rule over others combined with a maniacal sense of self-worth which enables and justifies their sense of entitlement to do so. This is why the great author J.R.R. Tolkien said that he was increasingly drawn to anarchy. He said that not one man in a thousand was fit to exercise authority over others for any great length of time, least of all, those who desire to do so. His opus, The Lord of the Rings, explores the corrupting effects of unholy power. 

Put enough of such defective persons in an echo-chamber of a national capital and there can be no doubt that they will work together tirelessly to draw all power to the Imperial Center, leaving citizens in the heartland less and less control over their own affairs. This pathology has long advanced and has now brought our Republic to its death-bed. 

Four years ago when Donald Trump won the election, the coastal elites were shocked. The Wall Street Journal ran a piece about how all the Silicon Valley tech kings noticed that they had more in common with their peers in China and India than they did with famers in California's central valley. They started questioning if it wasn't better if the rules were made in a decentralized manner as I reported here. IOW they "discovered" the principle of localism. 

I hope they haven't forgotten it just because the gun is now being held by what they perceive as a member of their own "tribe". When Barack Obama won, he said "elections have consequences" and acted accordingly. Not everyone on the right accepted his election, but the left expected them to. When Donald Trump was elected president, the left went berserk and spent the last four years refusing to accept the results. Now the left has won, and they are back to calling for "unity". I expect the right to see through the extreme insincerity and gross hypocrisy of these calls, but even if they weren't making them, I expect many on the right to think the election results are illegitimate. What if both sides are right?  

When all the rules are made in the Imperial Center, it is catastrophic for the losing side. In such an arrangement it isn't reasonable for almost half the population, or even one-tenth of the population for that matter, to just shrug it off and accept the election results as "legitimate" and binding on them when so much power is held by a coalition so adverse to their interests. Making the central government so powerful raises the stakes until one tribe or both starts cheating to win, further reducing the legitimacy of the process. 

When the central government only made a few rules, mostly related to foreign policy, people could accept the results when they lost. Now, with FEDGOV attempting to control, manage, regulate, and direct almost every aspect of our lives, they can't, and it is understandable why. Why should they lose their way of life just because the "other" side was able to cobble together a narrow victory, and that possibly by fraudulent means? Each side issues a hollow call for "unity" after they win, even while they immediately compile enemies lists and pay off their coalitions from the Treasury. Each side refuses to accept the results when they lose, because those results are so catastrophic.

Democracy has been described as "three wolves and a sheep voting over what's for dinner." This quip highlights the fact that majority rule isn't the same as legitimate rule. Particularly when the issue at question is a matter of individual rights, but the point also applies when the questions being voted on become too over-arching. In a nation of 150 million voters, eighty million voting that the other seventy million have to give half of their income to the "winners" and order their lives how the "winners" think they should, even with regards to how they are allowed to breathe, simply isn't "legitimate". Democracy becomes a whole pasture of sheep voting on what's for dinner, only to learn that wolves and townspeople from distant lands have outvoted them.

The more distant the democracy, the shorter it's legitimate reach should be. If I live in a state or a city of ten million people who overwhelmingly feel an issue should be handled one way, the fact that overall vote went slightly in favor of a candidate who wants to do it another way isn't going to be accepted as the final word. It is more natural to look to how the people who live around you feel about an issue rather than distant strangers who know little about your life or perspectives and care less. Over-centralization of government power leads to a loss of legitimacy. You can blame the people, left or right, all you want, but you won't change the natural order, the moral order of the universe, by doing so.

The only lasting solution is for the promises the federalists made when our Constitution was enacted to be kept by our federal government today. We have to decentralize. We have to learn to be able to sleep well at night even though people we have never met living in a city we have never been to are doing things that we, or our would-be Imperial Overlords and their media, disapprove of. In other, words, we need to behave as if we are mentally healthy instead of mentally ill. It is downright crazy to think that we can see a "news" report on TV and think we know better how a situation should be handled than the people who live there. Will those people make mistakes? Of course, and so does Washington. But those mistakes are both easier to correct and easier to escape from when made on the local, rather than the national, level.

Why They Will Always Be On the Take Under a Central State

 Are the Biden's guilty of taking money from foreign companies, including those with ties to the Chinese Communist Party, in exchange for influence in U.S. policy? The evidence is overwhelming that they are and that Joe Biden is lying when he said he knew nothing about it. But they are far from alone. There is a long line of spouses, children, and relatives from both parties getting paid by various interests far in excess of any reasonable estimate of their actual value. 

Donald Trump's children haven't done that much yet, but he's only been in government four years, not forty-seven like Biden. Already, Jared Kushner has done some things that seem to me like he is moving in the same direction. Mostly though, the Trump kids have only looted Republican donors, paying their spouses and girlfriends from party funds, not selling out the country. Again though, they've not had as long to let the system draw them in to impropriety. 

Some of you may be tempted to think that the answer is "Term Limits". It isn't. Or at least that can only slow the process down. The problem is the vast scope of power that the Central State possess. When the Central Government has the power to micromanage a Twenty Trillion Dollar domestic economy and is meddling in other nations all over the globe, there are just too many chips on one table. Hustlers are going to offer vast fortunes to get in on that game, and sooner or later the politicians will succumb, telling themselves and you whatever lies need to be said to justify it.

This situation will occur and re-occur in a proliferation of forms until we eliminate the root problem- there is too much power and money heaped up in one central location. This is going to invite corruption because the corruptors can make money even spending vast amounts of money and effort to empower it. Decentralization means that the "jackpot" of corruption is much smaller, and looks much less enticing compared to the rewards of making an honest living. If it happens, it is easier to catch an correct than if it occurs in some distant imperial city by the extremely powerful who would then have access to a tremendous amount of capital to preserve their position.

We simply must decentralize the state if it isn't to collapse in an orgy of corruption and mismanagement. And localism is all about how to decentralize the state. If you think the problem is Joe Biden, or Donald Trump for that matter, then you are focusing on the symptom, not the real cause. 

Von Mises Institute Gets It Right on Centralization

  Too much centralization is destroying America because it turns everything into a political crises. We will make localists of them yet!

Shifting Social Media Platforms and Central Banking

 When two of the largest social media companies in the world starting "tipping their hand" and making it clear that they were going to herd users towards left-collectivism, some of my more conservative friends called for the government to step in and "make them play fair". I opposed such intervention, on the grounds that in the long run there is nothing less fair than letting the government, hopelessly politicized as it is, decide what is fair and what isn't. A government whose goal is liberty should protect a free marketplace and let individuals decide where they want to be. 

To practice what I preached, I started accounts on alternative platforms like Minds.com, Parler, and MeWe under different names. Unfortunately it is against human nature to quickly see that "the cheese has been moved" and adapt one's behavior accordingly. So far as I know, few of my friends did likewise. The unfortunate side of "conservative" (and also the good side in these irrational times) is that such people are very slow to change their behavior. 

That can sometimes lead to right-collectivism (i.e. fascism), whereby they demand that the state intervenes to force everyone else to change in order to make their present behavior comfortable for them. This is ultimately just as immoral and unworkable as the left's present madness. When Facebook goes bad, you move to an alternative to Facebook. If enough do so, Facebook will either change its own behavior even without government action, or it will become irrelevant except as an echo-chamber of it's own chosen viewpoint. That's the market, and that's freedom.

There are a couple of caveats to the above. Unfortunately corporations are creations of government action, and certain large corporations are de-facto arms of the government. If a company is a monopoly or is propped up by government action then of course it is consistent with liberty to work toward removing the props, or intervention to regulate the monopoly. But social media companies are not monopolies in the way that your electric company is a monopoly. They don't require their own huge physical distribution systems which would be expensive and wasteful to replicate, creating a barrier to entry. Facebook for example, is just the place where everyone is right now. There is nothing about its infrastructure demands that physically prevents competition. Many alternatives have popped up recently and the only thing preventing them from taking off is that people don't want to move. If Facebook continues it's objectionable behavior though, in time it will happen. In a trickle at first, but once critical mass has been reached it will be a tsunami.  

The real threat to freedom in this, and so many other areas of life, is central banking. The central pillar of localism is that you cannot have central banking and a decentralized government. Indeed, you can't have central banking and a decentralized society in the long run. Those who control the printing press have a "magic money machine" which allows them to create buying power at will, by sucking it from the labor-value embedded in the currency held by all others, and give it to their friends. If you or I had control of such a machine, in time we would become all-powerful politically, and so must they. Therefore, if a nation is to remain free it must destroy the magic money machine of it's ruling class and return to honest money.

People of great wealth can always buy themselves a loud voice, that's not what I am warning about. That's just the market in operation. What I am warning about is that once you have central banking the press-masters can shift the cost of shaping society to their whims onto the backs of the rest of that society. They can herd us as they like, and we will pay the costs of our own control. 

For example, they could promote a particular social media company, say Twitter or Facebook, so that they achieve market dominance. And they could do this using money that they create out of thin air. Money whose value is ultimately drawn from the labor of the rest of us. If their venture is profitable, they pay the money back. If it isn't, they simply create more money and cover the losses. And if people resist the increasingly heavy hand of the manipulators and flee to other platforms, well once those platforms gain enough audience they can simply buy those too. Then those with alternative viewpoints will have to flee again, and again, until there is no place to hide from those who have bought up the world with money whose value is obtained by the sweat of the very people that they are enslaving. There can be no living by "free market principles" without a free market, when the associates of the press-masters have bought out everything and control all "private" property.

Aside from a lack of morality and public virtue, there is no bigger threat to our freedom today than central banking. It is the ultimate source of energy behind all other internal threats. Including the threat poised by social media herding. If neither dominant political party will address this issue, and they won't for their infrastructure has been thoroughly purchased by these same forces, then we need to migrate away from them too, just as we migrate away from social media giants. Even if we have to start one or one hundred local alternatives. 

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Books by Mark Moore   

Obamacare Isn't Saving Us from the Chicom Virus, and Ending It Won't Make Us Less Safe From It

I saw that the main paper in my state ran yet another highly biased wire report yesterday on the so-called "Affordable Care Act". It started by saying...

The Trump Administration touched off another politically charged battle over the future of the Affordable Care Act with its latest maneuver to dismantle the law during a pandemic — a move that Democrats lambasted and few Republicans defended.

It went on and on quoting people about how terrible it was that anyone was even considering rolling back any aspect of Obamacare while this highly infectious disease was ravaging the country. It was almost strident in sending the message that we need this nationalized healthcare plan more than ever.

They are the only state-wide newspaper and have been a primary source of information for Arkansas voters for many decades. Politicians are afraid to cross them. Thus, they must bear significant responsibility for the poor economic conditions and ongoing political corruption and dysfunction in our state. They owe us reparations, though the blame also falls on those of us who are so shallow and inept as to continue to give them credibility just because they are big and loud.

I didn't vote for Donald Trump and I have no plans to in November either. Still, the story is extremely poorly reasoned and misleading. Obamacare is the law of the land. Our healthcare infrastructure is now built around it. If America's response to the pandemic has been inadequate it must be at least in part because Obamacare isn't good at dealing with a crisis of this kind and magnitude. It is a clunky, centralized, inefficient and unwieldly administrative nightmare that was cobbled together by giving a vast array of interest groups a piece of the taxpayer pie. It wasn't even built to be a flexible and rapid response to an infectious disease, and it is consuming a vast amount of resources which could otherwise be spent on an effective response.

In fact, a strong argument can be made that the more committed a state is to Obamacare, the weaker its response has been to the crisis. Nineteen states have not enacted a critical piece of the Obamacare pie. They haven't expanded Medicaid to every healthy adult below the federal poverty line. So their health-care infrastructure isn't as centralized and ordered around Obamacare as it is in the other thirty-one states.

Now, let's look at the death-rates for the Chi-com virus by state....

I'd like to thank Alan Clark for his recent statistics on COVID-19......
***************
Deaths per million from COVID-19
Worst nation in the world Belgium 851 

New Jersey 1670
New York 1610
Connecticut 1210
Massachusetts 1150
Rhode Island 870
District of Columbia 850
Louisiana 680
Michigan 610
Illinois 540
Delaware 520
Maryland 520
Pennsylvania 510 

If you remove these states (the worst 12 ) from the numbers the rest of the United States has performed better than most of the world.
 *******************
What do each of these twelve states have in common? They are all among the states which expanded Medicaid. IOW these are the states which fully embraced Obamacare. If it were a matter of chance, at least four of these states should be from the group which failed to expand Medicaid, instead, none of them are. If there is any relationship between how well a state has dealt with the COVID-19 crises and degree of integration of Obamacare then it is an inverse relationship. The more a state integrated it's health-care system with Obamacare the less likely it is that they had a lower death-rate from the illness.

The biggest problem early on in America was that testing was far too slow. This produced chaos in our early response because no one could tell if they were infected or not. This too was a result of an overly-centralized healthcare delivery system. In this case, early on the CDC insisted that all testing would go through them. The centralized response slowed things down and it wasn't until things were out of hand that they threw in the towel and let a decentralized approach to testing resolve the problem. Would that have been more likely or less likely to have been the case without Obamacare imposing a centralized, if clunky, healthcare system on the nation?

Government has a legitimate role in stopping the spread of highly infectious diseases. There is no evidence to support the belief that Obamacare is the best way, or even a good way, to do that. We don't need Obamacare to protect us from COVID-19, and there is evidence to suggest that we could do better without it.


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Books by Mark Moore

Founder of BET Says Black Lives Matter Should Start Their Own Political Party

Based on his conclusion that the Democrats have taken the black vote for granted.

This is the logical conclusion of identity politics. Each identity gets their own political party to leverage their interests. I support more parties, including the right to have this one. But my preference would be that the parties would be focused on competing ideas about how to govern, not competing interest groups fighting for a bigger share of government loot. The Democrat party may have been playing with fire when it built its coalition around identity politics. The Republicans are repulsive for different reasons.

Either way, if America is going to collectivism and group-identity then more parties is still less-worse than those same things in a two party system. Ultimately though, free thinking persons of every color and political persuasion are now in a struggle for their right to retain their identity as individual persons rather than be seen purely as members of a set of groups. The left has their collectivism, and so does the right (remember fascism, it didn't die in the Furherbunker). I demand the right to think, speak and live outside the societal expectations of the sum total of the groups I am assigned without collectivist retribution from either side.

I do notice that most of the protestors at BLM events are not black, so this party could count on some outgroup support for a while.

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If you are mentally healthy enough to sleep well at night even if people you have never met living in a city you have never been to are doing things that you don't approve of, then Localism may be the philosophy of government for you.

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Big Corporations, Not Cops, Have a License to Kill

PG&E just pled guilty to killing 84 people in California. The company was repeatedly warned that its faulty equipment was going to start a wildfire. In 2018 their equipment did start a fire- resulting in the deaths of scores of innocent people and destroying the small town of Paradise, California. The company was still on "probation" for a 2010 fire that killed eight people. That fire was caused by an explosion of one of their transformers.

The company's President appeared in court and confessed to 84 counts of manslaughter on behalf of his company. Nothing happened to him, or any other executive of PG&E. His company was assessed with fines. They were huge fines, but the company is paying them. There isn't a single real human being who is being held legally accountable for the reckless decisions which resulted in the deaths of eighty-four innocent people. Not even a $10 fine.

Look, I don't approve of police using excessive force. It is unfortunate that persons resisting arrest are sometimes killed while being taken into custody. If a policeman abuses his authority with malice aforethought, of course he should be held legally accountable for it. Even if they kill someone in custody by gross negligence, they should still be held accountable. And by and large, they are. While the media is getting us in an uproar about a legitimate problem, but one that does often get addressed when it occurs. What the media is mostly ignoring is a much larger problem that is baked into the cake of our system. Large corporations have a license to kill. 

The PG&E management whose decisions killed 84 people won't pay any legal price for their actions. Corporations have gotten too big. They have more access to our government than real flesh-and-blood citizens do. The laws are written by their lobbyists and voted in by politicians whose campaigns are funded by them, running on a party label which is financed by them. No wonder that same government bails out Wall St. over Main St. 100-1. And it will continue to do so, passing the crushing debt to do so onto our children. That's why FEDGOV shouldn't have the power to bail out anyone.

This is an issue on which left, right, and the middle can all agree on. Corporations, themselves a creature of government, are too powerful. The people who run them are too powerful. The biggest are basically immortal, and overtime more wealth is being transferred from the middle class to them. When they mess up, the are bailed out. If we mess up, or even experience misfortune beyond our control, we lose our homes. They make our laws, they loot our kids, and now they take our lives with impunity. The principle of incorporation as a shield for legal consequences has been taken too far. Localism has very specific ways of dealing with the problem of corporatism, and the other twelve ways that control of our lives is systematically taken from us and handed to ever more distant capitol cities. 

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He's Right CHS on the end of Globalization

Charles Hughes-Smith is right about globalization and financialization and everything that depended on them is dying, and why that's a good thing.

Astounding Facts On China and Globalism from Kyle Bass

Jan Jekielek just put up an astounding interview with investment guru Kyle Bass. Here is a sample:

"And then January 23, Xi Jinping closed down all air traffic from Wuhan to the rest of China. But he allowed Wuhan air traffic to travel to the rest of the world. Essentially, Xi Jinping knowingly infected the rest of the world. … “If he’s going to go down, the world is going to go down with him,” essentially what he was saying."

" Think about this: we get 100% of our blood pressure medicine from China. 100%. There are 700,000 people in the United States who take blood pressure medicine every single day. We have a 13-day supply. This is insane. This has to change."

"I’m sure you’ve heard that the Chinese Communist Party decided that anyone that’s to move their supply chains out of China needs a permit to leave. I don’t know if you’ve heard that in the last couple of weeks. But for the last three years, really since the fourth quarter of 2016, when the Chinese completely closed off any kind of external foreign direct investment by rank and file Chinese and even the government—if you remember when they closed the door when they were having a serious currency devaluation problem—companies that do business in China, whether you’re Intel, or Sony, or BMW, or Chevron, those companies haven’t been able to get their dollars out of China, their dollar profits, since the fourth quarter of 2016. I know several of them have hired friends of mine that are former bureaucrats in U.S. administration who have relationships with Wang Qishan, with Xi, with his party, trying to get the money out. They haven’t been able to get the money out for four years, Jan, and now we’re being told that maybe you can’t get your supply chains out."

"I know of a company that I’ll leave unnamed, a very large public company, that has $10 billion in cash on its balance sheet as per its annual filing, and $1.5 billion of that money is in China. They haven’t been able to get it for four years, and I don’t know how they’re ever going to get it out, truthfully. And so, this is what I worry about: our pensions and all of the money that China has figured out how to coerce MSCI and the various index providers, the passive providers, to weigh China so heavily."

"People say, “Well, if we just disengage with China, it’s going to cost us 2-2.5% of GDP. To that I say, “They steal 2% of GDP from us every year in intellectual property, and they earn a return on that. It’s actually a better deal for us to just stop. I know that sounds hyperbolic, but it’s just a fact."

Jekielek asked Bass about the California State Pension fund. I was shocked by the extent to which even our state pension systems were run by foreigners from hostile and unfree regimes. 

"You are opening an entire new can of worms here by bringing up CalPERS. I’m sure you know, their chief investment officer is actually a member of the Chinese Communist Party. He is the deputy director of China’s currency administrator. You don’t get a top five job in China unless you are part of the party elite. He managed the entire currency reserves for the Chinese Communist Party when he worked at SAFE, and now he somehow has weaseled his way in to be the CIO of the largest pension fund in the United States and he is shoveling dollars to China. That itself needs a full-scale investigation. He has already admitted to being part of the Thousand Talents Program, which I’m sure your viewers know what that is. There are about 70,000 members of the Chinese Communist Party that are instructed to infiltrate other economies and steal all intellectual property methods, business methods, and any kind of secrets and report back to the Communist Party. In fact, they have an award every year for the best theft and they give 750,000-1,000,000 dollars and you get a plaque. Ben Meng, the CIO of CalPERS, is a part of the Thousand Talents Program and a member of the Chinese Communist Party. That begs the question to me: who is your fiduciary responsibility to? In theory, if you are a Communist Party member, there is no one higher than Xi Jinping, even whatever God you want to worship. Yet, if you are the CIO of a massive pension fund, you must have a fiduciary responsibility to the teachers of California."

The bottom line is that globalism is deadly both to liberty, prosperity, and our very lives. Both parties have been following the global corporate money and rushing towards this sort of international integration for some time. And for some time, I have been warning of globalism's hidden costs. They are all wrong, and I am right. Not necessarily because I am smarter than them, but just because they are seeing it the way those offering them money want them to see it. There is no other philosophy of government that can stop globalism except its polar opposite, Localism. The others don't even recognize the problem, and therefore cannot provide adequate solutions. In the end, its either going to be Localism or Globalism with a boot stamping down on the face of all of mankind.

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Borrowing 20K Against Your Credit then Giving You Eight Percent of it Back

Not only has the fear generated from the cornonavirus finally given authoritarians the excuse they needed to vastly expand state power, it has provided perfect cover to deflect blame for their gross mismanagement of the economy and wanton looting of the public treasury. They get to blame the virus for a curb in stock market excesses which was long overdue anyway. They are off the hook for a collapse in an economy which had been running on fumes for a long time.

It has also permitted them to launch another spectacularly large heist. They got away with the 2008 bailouts. All they learned from it was that they could get away with gambling big. If they win, they keep the winnings. If they lose, they socialize the costs and we all pay. Why change your behavior if those are the consequences? The cost of any irresponsible over-leveraging will fall on the republic as a whole, not the ones who got greedy. People who are desperate now will lunge for the money, but let's look at the numbers.

A whopping two trillion dollar stimulus bill has already been passed. Another four trillion dollar bill is on deck. That's six trillion dollars. There are probably about three hundred million legal U.S. citizens in the United States. So what the "Stimulus Plan" proposes to do is to borrow about $20,000 against, on average, the credit of every man, woman, and child citizen of the United States. There are five in my household, of whom three are children and I am the only breadwinner. So they plan to borrow $100,000 as my family's share and give it to who?

They propose to give $1,200 of the $20,000 back to the citizens, the people whose credit is being drawn upon. What about the other $18,900? It is mostly going to go back to the same people who got bailed out one way or another in the 2008 and on bailouts. They are, with a loud flourish, giving you a small amount of money with one hand while they are maxing your credit card out with the other!

Some people will do better than that. Some portion of that money will be made available to businesses in the form of a loan, which will become a grant if "most" of it goes to keep making payrolls. That is going to help some of us, at the expense of others. Why does FEDGOV have the right to make that call? In the case of small businesses, the most probably outcome is that the family members on the payroll will be kept, the rest laid off, and the balance of the money will go into the coffers of the business. Let's say the figure that turns it from a "loan" into a "grant" is that 70% goes to payroll. So Wal-Mart can pay the high-salary execs and a skeleton crew to run the stores and pocked 30% of the money. Who wants to tell me why my three small children should have to incur $60,000 of new federal debt so that can happen?

The fact is that in lean times businesses that failed to provide a cushion go under. Other businesses which were more prudent survive those times and expand to meet those needs, or someone else comes along and they get an opportunity to start a new enterprise which fills that need. This is the free market approach, but those running things don't believe in the free market. They believe that those on top should stay on top no matter what. That's why they are borrowing against everyone's credit to benefit the few. In 2008 it was the top one percent of the top one percent. This time it is mostly still them, but in order to avoid a riot they are giving the top 10%-15% a chance for a small cut, and throwing scraps to the rest of us.


This is a terminally corrupt system borrowing against the future to buy it a little more time. The more time it buys in this manner, the worse the pain of the inevitable consequences will be. The sooner we can figure that out the less drawn-out the pain of correction will be. We can start seeking sustainable answers in economics and government, built on justice and equity instead of "do whatever it takes to keep the party going until after the next election".

The temptation to do this will be too great for any politician to resist. The only way to stop the looting is to rebuild with a system so decentralized that the Central government does not have the ability to abuse the credit of the citizens in this fashion. That's localism.

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Q Anon Dead Wrong: New Federal Reserve Plan A Disaster for the Heartland

The White House seems to be forging ahead with a radical change to the Federal Reserve System. The mysterious "Q Anon", popularized by the "X22 Report" and who started on a disgusting porn drop site that has since been shut down, has been telling a certain group of desperate people just what they want to hear: Keep trusting Trump, he's about to start arresting all the people you don't like, end the federal reserve with this brilliant new plan, and usher in a new era of prosperity for people like you.

I am well aware of how human nature works. Mark Twain said "it is easier to fool people than to convince them they have been fooled." Indeed, the normal human reaction to someone explaining how a person has been conned is for that person to lash out at the explainer, and double-down on defending the person conning them. So be it. My obligation is to give the warning. Hopefully, if enough give the warning this plan won't come to pass. If it does, then hopefully, the more noble of those who I warned will at least remember that I tried to warn them. There is another class of persons who will persist in error even if it means the world burns, because they want everything to change except themselves. Warnings are wasted on such persons. They are born to be used by those who will tell them what they want to hear. People who want to be lied to will always get their wish. 

I hope the plan is stopped. If this plan is implemented and it turns out to be a good thing, never listen to anything I say ever again. But if I'm right when leading lights from both parties and the "Qs" of this world are pulling for it, remember who saw it coming. 

Most people who are against the federal reserve gravitate towards that quote where one of the guys founding it was supposed to have said "we will charge them interest on money we create out of thin air." That really doesn't apply to taxpayers directly though. The Federal Reserve is really a bunch of private banks who have a special relationship with the Federal Government, not a government agency. And according to the arrangement, any profits they get from interest payments are to be remitted to the U.S. Treasury. So the interest they get from thin air is mostly not so direct as all that. Were the scam that simple, most people would catch on and demand that it be ended. 

They have to have more shells in the game to pull off the crime, but the subtle execution does not lessen the magnitude of the theft. They can still steal vast amounts of wealth, without most people ever connecting the dots. What the federal reserve allows them to do is to "over-leverage". That is, use a financial asset as the basis for creation of credit through debt to acquire another financial asset, which they then use as the basis for more credit creation and so forth. 

Here's an example I give of leverage:  If I borrow a billion to make a billion plus a million, then I am a millionaire even though I gained only one-tenth of one percent on the money I borrowed. But if I lose one-tenth of one percent, I am insolvent and can't even pay back all of the billion that I owe. What if I owe that to someone who is also highly levered and they need my money to stay solvent? Then the people they owe money to are in trouble. It is a house of cards built on leverage, which as I explain in my book, should be strictly regulated. This explains the basis for a lot of the "wealth" in our nation. We have corporations and people who are paper millionaires that have a billion dollars in debt. 

Obviously that is extremely risky and no one could get away with it for long because even a slight miscalculation in which the value of what you own goes down would leave one insolvent. That's where the Federal Reserve comes in. What happened in 2008 was that a medium-sized default threatened to turn into a system crash because all the big players were highly-leveraged. The Fed launched several programs to make sure the big boys stayed solvent regardless of how reckless they had been using leverage. Of course, if you or I got strung out on debt, they'd take our homes. 

The localist answer is to limit by law both global corporations and the leverage they use to buy up the world on credit. And hold officers of the bank personally responsible for the assets of the bank. The banker's answer is to make the tax payer the lender of last resort so that massive leverage can continue. The big picture is this will keep us tottering along a narrow path between deflationary collapse or hyper-inflationary financial ruin until we fall off one way or the other. 

When the market would not supply the banks with the "liquidity" they needed, the federal reserve was there to buy the asset, or loan against it, at an above-market price. In this case "liquidity" really means "pay me for this 'asset' according to what I paid for it, not according to what the market prices it at now, so that I don't go down in a giant storm of debt." And the Federal Reserve has done it. Their balance sheet of stuff they have bought is huge. Far larger than it has traditionally been. They are buying their buddy's assets, propping up the price, but not selling the same stuff because putting more on the market would lower the price. The effect of their operations is to artificially lift the price of what they are massively buying.

That's also because if they sell the assets they would be taking money out of the market, and they need to keep pumping more money into the market to keep up with the ever-increasing amounts of leverage the big players are creating. If you need only 1% margin to protect against price shocks, every time a big bank levers up and creates another billion dollars then you need to pump in another ten million dollars to provide that margin. What if prices get volatile? Like they have lately. What if assets face a sustained drop in price, like they have lately? The Federal Reserve has tried make loans almost free for the big players, and it has tried every buy-back program allowed by law, but it isn't enough.

The second problem is that some of the assets the Fed bought may never reach the "market price" they paid for them. Some assets don't have a liquidity problem- a liquidity problem means it will take time before they can be sold at a profit but they are worth at least what you paid for them. This is different from a solvency problem. A solvency problem means the asset has lost real value and will never be sold for what was paid for it. The Federal Reserve can hide this for quite a while, because they can keep creating more money and credit and are never forced to "liquidate". As long as they pay below the maturity price for a secure asset that will pay 100% of the time, they can slowly transfer the losses of their friends onto the backs of everyone else holding dollars without it being noticed much.

A hedge fund or investment bank may have bought a treasury that pays $1,000,000 in a years time for $998,500. Then used that asset as the basis for a loan for the price of the asset. In other words, leveraged. It works great when asset prices are going up. But when they are dropping, you borrowed money to buy something that lost value and you still owe the money. If the market price for bonds dropped to $995,000 they are stuck. That's where the Federal Reserve comes in. If you are one of the connected they can pay you an above-market price for that asset- like what you paid for it. They will still, on paper, make money just by holding it until it matures. 

The fact that these people can buy certain government bonds and act like they still have the money they used to buy the bonds has made the bonds super popular, even if they pay little interest. In some places, the government bonds have negative interest. The buyer pays to loan the government money. They pay $1,000,100 for the right to a government bond that will pay them only $1,000,000 in a year. Ever wondered who would do something that dumb? It's not dumb if they can have the promise of $1,000,000 in a year and in the meantime still get the money in a low interest loan used to buy higher-interest securities. That works great so long as the securities keep going up in price. That's the key to keeping this asylum running.

But negative interest rates are the end of the road for the Federal Reserve's tactic of bailing out its friends while still showing a paper profit. It would show a paper loss on that transaction, and an overall loss if it didn't have a large supply of instruments which paid at least some interest. And that's where we are. And their friends now have widespread losses on a whole range of securities that they bought with borrowed money. They are bankrupt billionaires with friends in high places.

That's where this new scheme comes in. I will quote from the Bloomberg article starting with a long list of asset-purchase programs which will be run by the U.S. Treasury, not the federal reserve. The federal reserve will merely provide loans to the Treasury to fund the bailouts.....

CPFF (Commercial Paper Funding Facility) – buying commercial paper from the issuer. PMCCF (Primary Market Corporate Credit Facility) – buying corporate bonds from the issuer. TALF (Term Asset-Backed Securities Loan Facility) – funding backstop for asset-backed securities. SMCCF (Secondary Market Corporate Credit Facility) – buying corporate bonds and bond ETFs in the secondary market. MSBLP (Main Street Business Lending Program) – Details are to come, but it will lend to eligible small and medium-size businesses, complementing efforts by the Small Business Association. 

To put it bluntly, the Fed isn’t allowed to do any of this. The central bank is only allowed to purchase or lend against securities that have government guarantee. This includes Treasury securities, agency mortgage-backed securities and the debt issued by Fannie Mae and Freddie Mac. An argument can be made that can also include municipal securities, but nothing in the laundry list above. 

So how can they do this? The Fed will finance a special purpose vehicle (SPV) for each acronym to conduct these operations. The Treasury, using the Exchange Stabilization Fund, will make an equity investment in each SPV and be in a “first loss” position. What does this mean? In essence, the Treasury, not the Fed, is buying all these securities and backstopping of loans; the Fed is acting as banker and providing financing. The Fed hired BlackRock Inc. to purchase these securities and handle the administration of the SPVs on behalf of the owner, the Treasury. 

In other words, the federal government is nationalizing large swaths of the financial markets. The Fed is providing the money to do it. BlackRock will be doing the trades.
This scheme essentially merges the Fed and Treasury into one organization. So, meet your new Fed chairman, Donald J. Trump. 

In 2008 when something similar was done, it was on a smaller scale. Since few understood it, the Bush and Obama administrations ceded total control of those acronym programs to then-Fed Chairman Ben Bernanke. He unwound them at the first available opportunity.

 There will be no unwind this time and if there is, it will be at a titanic loss borne by the taxpayers. The financiers learned that they were too big to fail and kept going back to the casino. They are about to take all of their losing bets to the Treasury, which will buy them at an above-market price- if it wasn't an above market price, the owners could just sell it on the market. Wall Street will keep its profitable investments, and unload its bad investments on the rest of us. This is going to be a massive dump of toxic trash to the taxpayers books.

I have been saying since the 2008 bailouts that this was going to be a situation where the connected dump all of their losing investments on the taxpayers while keeping the winnings for themselves. But even then, I never understood how to get the last piece in place- those purchases from the 09 bailouts were not on the books of the U.S. Government, but the consortium of private banks managing our currency- the Federal Reserve System. I had wondered exactly how they were going to get their losing bets transferred to the taxpayers books. This is how. This is the conduit for the largest bank robbery in world history- but its the banks and hedge funds that are robbing the rest of us.

What I said at first, about the Federal Reserve not "charging interest off of money we create from thin air" directly from taxpayers won't apply anymore. The Federal Reserve will charge taxpayers interest for money they create out of thin air. If they remit that money back to the Treasury, it will only be so that Treasury can buy the losing assets of Federal Reserve Member banks at above-market prices. They have a system in place where they absolutely cannot lose money no matter what they do- but it is built on the backs of the honest labor of the rest of us. This plan is not some kind of godsend for the heartland, it is betrayal. Woodrow Wilson is supposed to have said on leaving office that he had "unwittingly betrayed his country". On his watch the Federal Reserve was created. Now, if he goes through with this, Donald Trump will also betray his country. We should pray that he doesn't follow through.

Get the books

A Harbinger of Doom - No Banks Park Bonds, All Sell to Fed

The Federal Reserve is both buying bonds and paying banks to park their bonds with the fed for a while. Looks like no one is parking them. You can count on the fed paying the banks above-market rates for those bonds with either option, otherwise they wouldn't use the fed, they would just sell or lease them on the open market. It looks like the real reason for the failure of the repo market is that banks are desperate to dump treasury debt. They don't want to hang onto it and rent it out to people who temporarily want collateral. 

An analogy would be if the big landlords in a town realized their community was going to lose its largest employers shortly and that the demand for rent houses was about to plummet. So they want to sell the houses and get out before its clear they are worth less. But if they all try to sell at once, the market will respond to that by causing the price of a house to go down. So it is a lose-lose for the landlords. They misallocated capital. But of course in this world, where the big banks own the political system, they believe that socialism is the answer - for their losses. They will keep their profits. They want the US government to buy their "houses" at what was the market price, before things went south. 

So at the risk of using too many analogies, imagine you have the right to have someone flip a coin. If its heads you win $100, if it is tails, you get nothing. That right is worth $50. Let's say you bought that right from someone else for $49. If you do that 1,000 times a day you keep the spread and do well. This amounts to waiting for the coin to be flipped, and if you lose, selling the "right to the profits" to the government as if you could still win the coin toss. It's pretending that the instrument is still worth $50 before we had price discovery and found out it was worth nothing. That's kind of like what the banks are now doing to all of the rest of us every day on a large scale, with the full approval of your favorite politician and your most hated politician of both parties. 

Whatever the answer to stopping this looting is, it isn't continuing to vote for one of the two established private political clubs that the media owned by the same folks keep telling you are your only options.

This is a bail-out for the banks at what will ultimately be the expense of the rest of us, and that is criminal and treasonous enough, especially since your favorite politicians are all going along with it. But why is this a harbinger of doom? We should be very alarmed that the banks are all choosing to sell rather than rent their bonds to the fed. This can only mean they expect those bonds to go down further in the future and are dumping a bad investment. When bonds go down, it is because interest rates rise.

There is no way our economy can prosper with rising interest rates, but with so much debt to sell, the market pressure for rates to increase will be enormous. Either the economy will crash due to much higher interest, or the dollar will crack due to much higher inflation if they suppress interest rates. Or both could happen, a return to 1970's style deflation.

A Disease of the Global Travelers and Centralization's Hidden Costs

The Coronavirus seems to disproportionately impact the international and political classes. Normal folks who stay in one area and don't hob-knob with jet-setters are much less likely to be exposed, at least in the first few waves.

This is a crises in which are elites are disproportionately at risk, and disproportionately have access to care. Politicians, international businessmen, and celebrities are in the news as "testing positive" for the virus. That makes the average person think that "someone they know" has it. But you don't really know those people. The magic of mass-media just makes you think you do. While the elites test positive, we can't even get a test!

Notice how in smaller nations, with less entrenched bureaucracies, the known effective treatment gets to patients much more quickly. It isn't like hydroxychloroquine is a new drug, we've known the risks associated with it for decades when fighting other maladies. In tiny Bahrain, it took five days for them to go from "discovery that it is effective" to "administer to patients". Here, even though our Chief Executive has known and publicly touted its efficacy in treating Coronavirus, he can't seem to get past his own government's built-in hurdles to get it to the public quickly. Localism protects people better than large centralized governments.

This has been a recurring theme of mine- localism is security. We pay for insurance, we pay for setting up firewalls in computer systems and office buildings. Think of the costs of forsaking the "efficiency" of globalization as insurance. And we now see that "efficiency" comes with hidden costs. Not only is mass global commerce risky as far as spreading pathogens goes, but the vast bureaucracy which grows around a central state is actually an impediment to effective treatments reaching the general public in a timely fashion. And in a pandemic, time matters. 

That doesn't even include the long-term damage our ruling class is doing to the economy in an effort to stop short-term damage now.

A Decentralized Approach to Fighting the Coronavirus

The estimates of a million or more deaths in the US from the Coronavirus neglect that fact that people, groups, businesses, cities, and states alter their behavior voluntarily in the face of an epidemic. Some people seem to think that if the Federal government doesn't do something, then nothing gets done. That's not true, especially in a some-what free society. The ham-fisted totalitarian crack-down we have seen in China has slowed the spread of the virus, but that doesn't mean that this should be emulated. We should have an American answer to the virus, one which works with our strengths of freedom, decentralization, and ingenuity.

Let's start with something that needs to be said: Big Media is owned by global corporations, and so it should not be surprising that they have a pro-globalist outlook in their news, reporting, and entertainment. As such we cannot expect them to tell the truth about how secure national borders, a fire-walled economy which makes many of its own products and whose companies are national rather than global is much better at protecting people from pandemics than an open-borders globalists society which is always and in mass quantity sending and receiving goods and people to all other nations. In other words, decentralization is security. It is insurance. It is a firewall. And not just against highly contagious diseases. If our economy is vitally linked with that of say, China, when they go down, we go down too. Globalism has a lot of hidden costs, and the globally-owned media and the politicians they promote cannot be trusted to tell you that particular truth.

So if we were a more localist nation and society we would already be safer than we are now. Our economy and stock markets would already be more stable and resilient than they are now. We would not have to take any government action to make us safer than we are now because a decentralized government is inherently safer from the kind of threats we are now facing.

This is a problem made worse by an over-connected global economic and political system. Naturally, those who made the problem worse with over-centralization also advocate centralized responses to fix the problems which over-centralization caused. There are all sorts of government responses to prop up the stock market and provide "liquidity" to Wall Street financiers. There are calls to mandate lockdowns, China-style. And of course there are calls for more funding for various central-government programs to provide top-down management of the issue.

The reason doctors and health care is so expensive in America is that long ago the medical profession colluded with government to artificially restrict the supply of doctors by erecting unnecessary barriers to entry into the medical field. Government intervened on the supply-side to limit supply. Restricting supply always causes price increases. Normally that would reduce demand and the situation would correct, but this is health care, which is an inelastic good. People pay whatever it takes because they can die if they don't. So government's "solution" was to intervene on the demand side as well!  So government started throwing government money at health-care to make it "affordable". In other words, intervening to prop up the demand-side too.

Government first intervened in a way guaranteed to increase costs, and then tried to make up for it be heavily subsidizing those costs for increasing numbers of people. That didn't fix the underlying affordability problem which government helped produced, it just made it bigger by transforming it from a family issue to a national issue. 

Central government intervention has the potential to mess up pandemic response just like they did the rest of health care. They've already done it. For example the bottleneck in testing for the Wuhan Virus in the United States was in large part due to the fact that the Food and Drug Administration had ordered that all testing for the virus go through the Centers for Disease Control. Until last week only FEDGOV could process the tests! The CDC developed the tests. Only in the face of a massive bottleneck did the bureaucrats loosen their grip and on March 9th, less than a week ago, lifted this burdensome restriction. It is madness to look at facts like these and think that the root problem is inadequate central government action.

Still, people are focusing on socialist answers. For example I have heard calls for making any vaccine developed "free". No doubt socialists expect some drug company to risk massive amounts of money developing a vaccine and then give it out to the government at cost! This is an example of how, no matter how reasonable it sounds, socialism kills people with stupidity masked as caring and virtue. Socialism only looks good compared to what we have- Corporate Crony Rule where they get to socialize their losses but keep most of their profits. 

A better government response would be one which frees private firms from the government restrictions which hinder them. For example, I'd ask drugmakers what the ten most useless regulations government has imposed on them that slow down the roll out of vaccines. Then I'd suspend them as regards to this vaccine. I'd also push for legislation making the first billion dollars in profits tax free for any company with a safe and effective vaccine for the virus. And I'd push for legislation allowing them all to deploy without worrying about patent issues for two years- we could sort out who came up with the version that's going to get patent protection later. 

I'd also push for cheaper general flu anti-bodies right now using some of the same tactics. My kid had the flu last year. We payed $153 plus a doctor's visit for a general flu anti-body so that a flu which normally took three weeks to run its course took only a few days. That's available right now to lessen the impact of basically any flu. We just need to make sure people know that's a viable option, plus provide incentives similar to those described above to get the cost down, and awareness up. The central government needs to be a clearing-house for best practices used by others, not a command center. State and localities can decide for themselves what measures are truly necessary. Somewhere out there is an effective batch of strategies to beat this disease. We just need to free everyone to find it and let them reap the rewards for doing so, instead of them worrying about politicians jumping in and stealing both the credit, and the rewards with counter-productive government action disguised as "helping". 

Call For "Liquidity" Sign That Government Debt Load is Cracking Economy

I keep hearing complaints from Wall Street media outlets that there is "no liquidity". It's usually phrased in such a way that the average person thinks it should be some kind of problem for them and coupled with demands that the government "do something". Government has been doing something, for a long time, and that's only feeding an unsustainable addiction to credit and leverage.

When hedge fund dealers complain "there is no liquidity" what they mean is that banks won't loan them the amount of money they want at a price they like on the collateral that they have. Say they borrow a Government bond overnight, and then use that bond as collateral for a loan, then use that loan to buy something for one day that pays slightly more interest than the bond. Each transaction makes only a tiny profit from all that moving of paper and digits around, but when you move a billion dollars a day around, even a tiny net can get you very rich. At least on net. You may need to borrow a billion a day to make a billion and ten thousand a day.

This doesn't really add much to the real economy. It doesn't produce a product people use. It doesn't provide a service people want. It just gets in the middle of other transactions and reaps a tiny profit each time. But financialization has grown to become such an enormous part of the economy that if it goes down, it will be disruptive.

Look, when people buy a U.S. Treasury, it should be good collateral for a loan. So someone should be willing to pay to borrow them to use as loan collateral. This may be in the form of an agreement where "I will buy at price X for three days and you will buy it back from me at price Y at that point in time." A lender should be willing to loan some amount for some price against that collateral. But the bond in this case is a hot potato. They don't really want the bond for itself, just as something that can be used as collateral over and over again. The dealers just buy the bonds because the government allows them to buy it, then create credit from thin air based on the bond as collateral to buy something else, then rent the bond out on a short-term basis for others to use as collateral.

If this system breaks down at any point- including any player in the chain deciding they want more compensation for the transaction - then not only can those who spend all day doing this not skim, but the demand for bonds as collateral would collapse.  These bonds pay interest below even the official rate of inflation. They are not a  good investment in themselves, but government has managed to juice demand for them by allowing them to be used as top-notch collateral in all sorts of complicated schemes. Basically the financial industry can buy bonds that pay almost no interest but then borrow money against it for the full amount and rent it out to others for them to do the same and also use that money to buy something else. If you can do that, why not buy the bonds? Why not leverage to the moon and buy up the whole earth with it? That's what certain connected players have been doing for years now.

But highly-levered players are players that will go broke if their investments ever lose even a tiny percentage. If I borrow a billion to make a billion plus a million, then I am a millionaire even though I gained only one-tenth of one percent on the money. But if I lose one-tenth of one percent, I am insolvent and can't even pay back all of the billion that I owe. What if I owe that to someone who is also highly levered and they need my money to stay solvent? Then the people they owe money to are in trouble. It is a house of cards built on leverage, which as I explain in my book, should be strictly regulated.

When people along this chain can't be sure the other players can make good, they either don't loan them as much, or raise the price, or don't loan them anything at all. Why should the government care if rent-seekers and gamblers go broke? Because government bonds have become the chips. Their value has been grossly inflated by their use as "collateral". If that system breaks down and people only want the bonds for their value as final investments instead of collateral for other speculation, then the price, or interest rate the bonds pay, would have to reflect true market value. And that would be the end-of-the-world-as-we-know-it. The US government is teetering on the edge of insolvency now, and only gets away with it because of the ridiculously low payments it makes on bonds.

If the demand for these bonds is cut in half because the other half of the players are suspected of not being able to pay back their debt, then who will buy government bonds? Increasingly, governments themselves are doing that. That is the expressway to currency collapse but it may be the only off-ramp on the super-highway to deflationary collapse. When leverage is this high in the system, an economy has to ride a razor's edge to keep from veering off to one side or the other. The only way to build resiliency in the system is to restrict leverage, but then the moguls on Wall Street would really have to work for a living instead of getting rich gaming the system. Politicians couldn't just borrow and spend with impunity. Unsafe levels of leverage has allowed both. Localism has the solutions.

Greater Idaho? Twenty-two counties want to leave Oregon and Cali- Right out of Book

Right out of the book. Twenty-two counties from Oregon and northern California have movements to secede from their current states and join Idaho. That sounds like the sixth pillar of localism. Why should people in counties which are out of touch with the rest of their state have to stay due to some invisible line drawn long ago? The book was written in 2012. It was ahead of its time but its time is coming.