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Bigger Than Any Of Us November 18 10:27am

In 1850, the Fugitive Slave Law was passed and both Northerners and Southerners were now legally required to turn in runaway slaves. One year later, Harriet Beecher Stowe wrote Uncle Tom's Cabin (or Life Among the Lowly) as a serial in an antislavery paper, The National Era. In 1852, the Boston publishing company Jewett published it as a book and, as they are wont to say, the rest is history.

Widely considered to be the first social protest novel published in the United States (and the first major novel to have a black hero), Uncle Tom's Cabin sold more copies - with the exception of The Bible - than any book had ever sold in America until that point with sales reaching 300,000 copies in the first year.

Stowe's graphic depiction of slave life - based on true stories - personalized the issue, reclaiming it from the sanitized domain of courtroom legalese. Her story outraged some and inspired many others. To her critics, she answered with A Key to Uncle Tom's Cabin in 1853 to provide documentation that every incident in her book had actually happened. Upon meeting Harriet Beecher Stowe in 1862, Abraham Lincoln remarked: "So you're the little woman that wrote the book that made this great war."

There was a time when slavery was believed too deeply entrenched in American culture to ever be abolished. The movement to end this "peculiar institution" was made up of individuals willing to recognize that some things in life are bigger than any of us. Whether they literally risked their lives by rescuing slaves and running the Underground Railroad or they did their part by sewing clothes or blankets for escaped slaves or, yes, writing books like Uncle Tom's Cabin, the movement needed every single one of these brave humans doing their part - small or large.

What seems impossible and irreversible today can be addressed if we're willing to wake up and do the hard work. If we're willing to stop making excuses for the reprehensible leaders (sic) - both political and corporate - who profit from our complacency.

So, the next time you're deciding between watching a Will & Grace re-run or updating your Facebook, step up instead. Take a good, long look into your heart and an even longer look at the choices you make all day, every day - not from a place of guilt and shame but with a sense of revelation.

Accept the challenge to be better human being, a more responsible earthling. It takes courage to perform self-examination. It takes courage to accept that everything you know just might be wrong. It takes far more courage to do this than to volunteer to wage illegal and immoral wars.

Let's face it: Things sucked under George W. Bush. Things will suck under Barack Obama. Things have sucked under every president. Nothing will change until we change our minds. We can't be as indifferent as those before us. They didn't think enough about future generations so now we have to work twice as hard. It sucks, I know, but this not an issue of fairness. It's about survival.

Some things in life are bigger than any of us. The anti-slavery movement recognized this. Today, the entire planet is enslaved.to profit-seeking corporations and the corrupt politicians they own (yes, including the Pope of Hope). Are this generation's abolitionists ready to step up and create change? Not ask for change, create change.

Why not embrace your outrage and frustration and let it challenge you, inspire you, and motivate you? Instead of channeling your ambitions toward climbing a mountain, running a marathon, or striving to make your first million before you're 30, what greater goal could any of us ever aim for than to leave the planet much better off than how we found it? 

You have nothing to lose but your chains.

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Mickey Z. [send him email] is a self-educated writer/martial artist/vegan who lives with his wife Michele in New York City. Likes: sunsets, rainbows, and anarcho-syndicalism. Dislikes: mean people, traffic, and factory farming.  He is the author of six books, his latest being CPR for Dummies and No Innocent Bystanders.

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A Revolt Against Nature November 18 9:26am

Probably the most common question that has been hurled at me - in some exasperation - over the years is, "Why don't you stick to economics?"

For different reasons, this question has been thrown at me by fellow economists and by political thinkers and activists of many different persuasions: conservatives, liberals, and libertarians who have disagreed with me over political doctrine and are annoyed that an economist should venture "outside of his discipline."

Among economists, such a question is a sad reflection of the hyperspecialization among intellectuals of the present age. I think it manifestly true that very few of even the most dedicated economic technicians began their interest in economics because they were fascinated by cost curves, indifference classes, and the rest of the paraphernalia of modern economic theory. Almost to a man, they became interested in economics because they were interested in social and political problems and because they realized that the really hard political problems cannot be solved without an understanding of economics. After all, if they were really interested mainly in equations and tangencies on graphs, they would have become professional mathematicians and not have devoted their energies to an economic theory that is, at best, a third-rate application of mathematics.

Unfortunately, what usually happens to these people is that as they learn the often imposing structure and apparatus of economic theory, they become so fascinated by the minutiae of technique that they lose sight of the political and social problems that sparked their interest in the first place. This fascination is also reinforced by the economic structure of the economics profession (and all other academic professions) itself: namely, that prestige, rewards, and brownie points are garnered not by pondering the larger problems but by sticking to one's narrow last and becoming a leading expert on a picayune technical problem.

Among some economists, this syndrome has been carried so far that they scorn any attention to politico-economic problems as a demeaning and unclean impurity, even when such attention is given by economists who have made their mark in the world of specialized technique. And even among those economists who do deal with political problems, any consideration devoted to such larger extra-economic matters as property rights, the nature of government, or the importance of justice is scorned as hopelessly "metaphysical" and beyond the pale.

It is no accident, however, that the economists of this century of the broadest vision and the keenest insight - men such as Ludwig von Mises, Frank H. Knight, and F.A. Hayek - came early to the conclusion that mastery of pure economic theory was not enough, and that it was vital to explore related and fundamental problems of philosophy, political theory, and history. In particular, they realized that it was possible and crucially important to construct a broader systematic theory encompassing human action as a whole, in which economics could take its place as a consistent but subsidiary part.

In my own particular case, the major focus of my interest and my writings over the last three decades has been a part of this broader approach - libertarianism - the discipline of liberty. For I have come to believe that libertarianism is indeed a discipline, a "science," if you will, of its own, even though it has been only barely developed over the generations. Libertarianism is a new and emerging discipline that touches closely on many other areas of the study of human action: economics, philosophy, political theory, history, even - and not least - biology. For all of these provide in varying ways the groundwork, the elaboration, and the application of libertarianism. Some day, perhaps, liberty and "libertarian studies" will be recognized as an independent, though related, part of the academic curriculum.

This essay was delivered at a conference on human differentiation held by the Institute for Humane Studies at Gstaad, Switzerland, in the summer of 1972. A fundamental reason and grounding for liberty are the ineluctable facts of human biology; in particular, the fact that each individual is a unique person, in many ways different from all others. If individual diversity were not the universal rule, then the argument for liberty would be weak indeed. For if individuals were as interchangeable as ants, why should anyone worry about maximizing the opportunity for every person to develop his mind and his faculties and his personality to the fullest extent possible? The essay locates the prime horror of socialism as the egalitarian attempt to stamp out diversity among individuals and groups. In short, it reflects the grounding of libertarianism in individualism and individual diversity.

Murray N. Rothbard 1974

Egalitarianism as a Revolt Against Nature

For well over a century, the Left has generally been conceded to have morality, justice, and "idealism" on its side; the conservative opposition to the Left has largely been confined to the "impracticality" of its ideals. A common view, for example, is that socialism is splendid "in theory," but that it cannot "work" in practical life. What the conservatives failed to see is that while short-run gains can indeed be made by appealing to the impracticality of radical departures from the status quo, that by conceding the ethical and the "ideal" to the Left they were doomed to long-run defeat. For if one side is granted ethics and the "ideal" from the start, then that side will be able to effect gradual but sure changes in its own direction; and as these changes accumulate, the stigma of "impracticality" becomes less and less directly relevant. The conservative opposition, having staked its all on the seemingly firm ground of the "practical" (that is, the status quo) is doomed to lose as the status quo moves further in the left direction. The fact that the unreconstructed Stalinists are universally considered to be the "conservatives" in the Soviet Union is a happy logical joke upon conservatism; for in Russia the unrepentant statists are indeed the repositories of at least a superficial "practicality" and of a clinging to the existing status quo.

Never has the virus of "practicality" been more widespread than in the United States, for Americans consider themselves a "practical" people, and hence, the opposition to the Left, while originally stronger than elsewhere, has been perhaps the least firm at its foundation. It is now the advocates of the free market and the free society who have to meet the common charge of "impracticality."

In no area has the Left been granted justice and morality as extensively and almost universally as in its espousal of massive equality. It is rare indeed in the United States to find anyone, especially any intellectual, challenging the beauty and goodness of the egalitarian ideal. So committed is everyone to this ideal that "impracticality" - that is, the weakening of economic incentives - has been virtually the only criticism against even the most bizarre egalitarian programs. The inexorable march of egalitarianism is indication enough of the impossibility of avoiding ethical commitments; the fiercely "practical" Americans, in attempting to avoid ethical doctrines, cannot help setting forth such doctrines, but they can now only do so in unconscious, ad hoc, and unsystematic fashion. Keynes's famous insight that "practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist" - is true all the more of ethical judgments and ethical theory.

The unquestioned ethical status of "equality" may be seen in the common practice of economists. Economists are often caught in a value-judgment bind - eager to make political pronouncements. How can they do so while remaining "scientific" and value free? In the area of egalitarianism, they have been able to make a flat value judgment on behalf of equality with remarkable impunity. Sometimes this judgment has been frankly personal; at other times, the economist has pretended to be the surrogate of "society" in the course of making its value judgment. The result, however, is the same. Consider, for example, the late Henry C. Simons. After properly criticizing various "scientific" arguments for progressive taxation, he came out flatly for progression as follows:

The case for drastic progression in taxation must be rested on the case against inequality - on the ethical or aesthetic judgment that the prevailing distribution of wealth and income reveals a degree (and/or kind) of inequality which is distinctly evil or unlovely.

Another typical tactic may be culled from a standard text on public finance. According to Professor John F. Due,

The strongest argument for progression is the fact that the consensus of opinion in society today regards progression as necessary for equity. This is, in turn, based on the principle that the pattern of income distribution, before taxes, involves excessive inequality.

The latter "can be condemned on the basis of inherent unfairness in terms of the standards accepted by society."

Whether the economist boldly advances his own value judgments or whether he presumes to reflect the values of "society," his immunity from criticism has been remarkable nonetheless. While candor in proclaiming one's values may be admirable, it is surely not enough; in the quest for truth it is scarcely sufficient to proclaim one's value judgments as if they must be accepted as tablets from above that are not themselves subject to intellectual criticism and evaluation. Is there no requirement that these value judgments be in some sense valid, meaningful, cogent, true?

Suppose, for example, he had been in favor of the murder of all short people, of all adults under five feet, six inches in height. And suppose he had then written, "The case for the liquidation of all short people must be rested on the case against the existence of short people - on the ethical or aesthetic judgment that the prevailing number of short adults is distinctly evil or unlovely." One wonders if the reception accorded to Professor Simons's remarks by his fellow economists or social scientists would have been quite the same.

Or, we can ponder Professor Due writing similarly on behalf of the "opinion of society today" in the Germany of the 1930s with regard to the social treatment of Jews. The point is that in all these cases the logical status of Simons's or Due's remarks would have been precisely the same, even though their reception by the American intellectual community would have been strikingly different.

My point so far has been twofold:

1. that it is not enough for an intellectual or social scientist to proclaim his value judgments - that these judgments must be rationally defensible and must be demonstrable to be valid, cogent, and correct: in short, that they must no longer be treated as above intellectual criticism; and

2. that the goal of equality has for too long been treated uncritically and axiomatically as the ethical ideal.

Thus, economists in favor of egalitarian programs have typically counterbalanced their uncriticized "ideal" against possible disincentive effects on economic productivity; but rarely has the ideal itself been questioned.

Let us proceed, then, to a critique of the egalitarian ideal itself - should equality be granted its current status as an unquestioned ethical ideal? In the first place, we must challenge the very idea of a radical separation between something that is "true in theory" but "not valid in practice." If a theory is correct, then it does work in practice; if it does not work in practice, then it is a bad theory. The common separation between theory and practice is an artificial and fallacious one. But this is true in ethics as well as anything else. If an ethical ideal is inherently "impractical," that is, if it cannot work in practice, then it is a poor ideal and should be discarded forthwith. To put it more precisely, if an ethical goal violates the nature of man and/or the universe and, therefore, cannot work in practice, then it is a bad ideal and should be dismissed as a goal. If the goal itself violates the nature of man, then it is also a poor idea to work in the direction of that goal.

Suppose, for example, that it has come to be adopted as a universal ethical goal that all men be able to fly by flapping their arms. Let us assume that "proflappers" have been generally conceded the beauty and goodness of their goal, but have been criticized as "impractical." But the result is unending social misery as society tries continually to move in the direction of arm flying, and the preachers of arm flapping make everyone's lives miserable for being either lax or sinful enough not to live up to the common ideal. The proper critique here is to challenge the "ideal" goal itself; to point out that the goal itself is impossible in view of the physical nature of man and the universe; and, therefore, to free mankind from its enslavement to an inherently impossible and, hence, evil goal.

But this liberation could never occur so long as the anti-arm-fliers continued to be solely in the realm of the "practical" and to concede ethics and "idealism" to the high priests of arm flying. The challenge must take place at the core - at the presumed ethical superiority of a nonsensical goal. The same, I hold, is true of the egalitarian ideal, except that its social consequences are far more pernicious than an endless quest for man's flying unaided. For the condition of equality would wreak far more damage upon mankind.

What, in fact, is "equality"? The term has been much invoked but little analyzed. A and B are "equal" if they are identical to each other with respect to a given attribute. Thus, if Smith and Jones are both exactly six feet in height, then they may be said to be "equal" in height. If two sticks are identical in length, then their lengths are "equal," etc. There is one and only one way, then, in which any two people can really be "equal" in the fullest sense: they must be identical in all of their attributes. This means, of course, that equality of all men - the egalitarian ideal - can only be achieved if all men are precisely uniform, precisely identical with respect to all of their attributes. The egalitarian world would necessarily be a world of horror fiction - a world of faceless and identical creatures, devoid of all individuality, variety, or special creativity.

Indeed, it is precisely in horror fiction where the logical implications of an egalitarian world have been fully drawn. Professor Schoeck has resurrected for us the depiction of such a world in the British anti-utopian novel Facial Justice, by L.P. Hartley, in which envy is institutionalized by the State's making sure that all girls' faces are equally pretty, with medical operations being performed on both beautiful and ugly girls to bring all of their faces up or down to the general common denominator.

A short story by Kurt Vonnegut provides an even more comprehensive description of a fully egalitarian society. Thus, Vonnegut begins his story, "Harrison Bergeron":

The year was 2081, and everybody was finally equal. They weren't only equal before God and the law. They were equal every which way. Nobody was smarter than anybody else. Nobody was better looking than anybody else. Nobody was stronger or quicker than anybody else. All this equality was due to the 211th, 212th, and 213th Amendments to the Constitution, and to the unceasing vigilance of agents of the United States Handicapper General.

The "handicapping" worked partly as follows:

Hazel had a perfectly average intelligence, which meant she couldn't think about anything except in short bursts. And George, while his intelligence was way above normal, had a little mental handicap radio in his ear. He was required by law to wear it at all times. It was tuned to a government transmitter. Every twenty seconds or so, the transmitter would send out some sharp noise to keep people like George from taking unfair advantage of their brains.

The horror we all instinctively feel at these stories is the intuitive recognition that men are not uniform, that the species, mankind, is uniquely characterized by a high degree of variety, diversity, differentiation - in short, inequality. An egalitarian society can only hope to achieve its goals by totalitarian methods of coercion; and, even here, we all believe and hope the human spirit of individual man will rise up and thwart any such attempts to achieve an ant-heap world. In short, the portrayal of an egalitarian society is horror fiction because, when the implications of such a world are fully spelled out, we recognize that such a world and such attempts are profoundly antihuman; being antihuman in the deepest sense, the egalitarian goal is, therefore, evil and any attempts in the direction of such a goal must be considered evil as well.

The great fact of individual difference and variability (that is, inequality) is evident from the long record of human experience; hence, the general recognition of the antihuman nature of a world of coerced uniformity. Socially and economically, this variability manifests itself in the universal division of labor, and in the "Iron Law of Oligarchy" - the insight that, in every organization or activity, a few (generally the most able and/or the most interested) will end up as leaders, with the mass of the membership filling the ranks of the followers. In both cases, the same phenomenon is at work - outstanding success or leadership in any given activity is attained by what Jefferson called a "natural aristocracy" - those who are best attuned to that activity.

The age-old record of inequality seems to indicate that this variability and diversity is rooted in the biological nature of man. But it is precisely such a conclusion about biology and human nature that is the most galling of all possible irritants to our egalitarians. Even egalitarians would be hard put to deny the historical record, but their answer is that "culture" has been to blame; and since they obviously hold that culture is a pure act of the will, then the goal of changing the culture and inculcating society with equality seems to be attainable. In this area, the egalitarians slough off any pretense to scientific caution; they are scarcely content with acknowledging biology and culture as mutually interacting influences. Biology must be read out of court quickly and totally.

Let us ponder an example that is deliberately semifrivolous. Suppose that we observe our culture and find a common dictum to be, "Redheads are excitable." Here is a judgment of inequality, a conclusion that redheads as a group tend to differ from the nonredhead population. Suppose, then, that egalitarian sociologists investigate the problem, and they find that redheads do, indeed, tend to be more excitable than nonredheads by a statistically significant amount. Instead of admitting the possibility of some sort of biological difference, the egalitarian will quickly add that the "culture" is responsible for the phenomenon: the generally accepted "stereotype" that redheads are excitable had been instilled into every redheaded child from an early age, and he or she has simply been internalizing these judgments and acting in the way society was expecting him to act. Redheads, in brief, had been "brainwashed" by the predominant nonredhead culture.

While we are not denying the possibility of such a process occurring, this common complaint seems decidedly unlikely on rational analysis. For the egalitarian culture bugaboo implicitly assumes that the "culture" arrives and accumulates haphazardly, with no reference to social facts. The idea that "redheads are excitable" did not originate out of the thin air or as a divine commandment; how, then, did the idea come into being and gain general currency?

One favorite egalitarian device is to attribute all such group-identifying statements to obscure psychological drives. The public had a psychological need to accuse some social group of excitability, and redheads were fastened on as scapegoats. But why were redheads singled out? Why not blonds or brunettes? The horrible suspicion begins to loom that perhaps redheads were singled out because they were and are indeed more excitable and that, therefore, society's "stereotype" is simply a general insight into the facts of reality. Certainly this explanation accounts for more of the data and the processes at work and is a much simpler explanation besides.

Regarded objectively, it seems to be a far more sensible explanation than the idea of the culture as an arbitrary and ad hoc bogeyman. If so, then we might conclude that redheads are biologically more excitable and that propaganda beamed at redheads by egalitarians urging them to be less excitable is an attempt to induce redheads to violate their nature; therefore, it is this latter propaganda that may more accurately be called "brainwashing."

This is not to say, of course, that society can never make a mistake and that its judgments of group identity are always rooted in fact. But it seems to me that the burden of proof is far more on the egalitarians than on their supposedly "unenlightened" opponents.

Since egalitarians begin with the a priori axiom that all people, and hence all groups of peoples, are uniform and equal, it then follows for them that any and all group differences in status, prestige, or authority in society must be the result of unjust "oppression" and irrational "discrimination." Statistical proof of the "oppression" of redheads would proceed in a manner all too familiar in American political life; it might be shown, for example, that the median redhead income is lower than nonredheaded income, and further that the proportion of redheaded business executives, university professors, or congressmen is below their quotal representation in the population.

The most recent and conspicuous manifestation of this sort of quotal thinking was in the McGovern movement at the 1972 Democratic Convention. A few groups are singled out as having been "oppressed" by virtue of delegates to previous conventions falling below their quotal proportion of the population as a whole. In particular, women, youth, blacks, Chicanos (or the so-called Third World) were designated as having been oppressed; as a result, the Democratic Party, under the guidance of egalitarian-quota thinking, overrode the choices of the voters in order to compel their due quotal representation of these particular groups.

In some cases, the badge of "oppression" was an almost ludicrous construction. That youths of 18 to 25 years of age had been "underrepresented" could easily have been placed in proper perspective by a reductio ad absurdum, surely some impassioned McGovernite reformer could have risen to point out the grievous "underrepresentation" of five-year-olds at the convention and to urge that the five-year-old bloc receive its immediate due. It is only commonsense biological and social insight to realize that youths win their way into society through a process of apprenticeship; youths know less and have less experience than mature adults, and so it should be clear why they tend to have less status and authority than their elders. But to accept this would be to cast the egalitarian creed into some substantial doubt; further, it would fly in the face of the youth worship that has long been a grave problem of American culture. And so young people have been duly designated as an "oppressed class," and the coercing of their population quota is conceived as only just reparation for their previously exploited condition.

Women are another recently discovered "oppressed class," and the fact that political delegates have habitually been far more than 50 percent male is now held to be an evident sign of their oppression. Delegates to political conventions come from the ranks of party activists, and since women have not been nearly as politically active as men, their numbers have understandably been low. But, faced with this argument, the widening forces of "women's liberation" in America again revert to the talismanic argument about "brainwashing" by our "culture." For the women's liberationists can hardly deny the fact that every culture and civilization in history, from the simplest to the most complex, has been dominated by males. (In desperation, the liberationists have lately been countering with fantasies about the mighty Amazonian empire.) Their reply, once again, is that from time immemorial a male-dominated culture has brainwashed oppressed females to confine themselves to nurture, home, and the domestic hearth. The task of the liberationists is to effect a revolution in the female condition by sheer will, by the "raising of consciousness." If most women continue to cleave to domestic concerns, this only reveals the "false consciousness" that must be extirpated.

Of course, one neglected reply is that if, indeed, men have succeeded in dominating every culture, then this in itself is a demonstration of male "superiority"; for if all genders are equal, how is it that male domination emerged in every case? But apart from this question, biology itself is being angrily denied and cast aside. The cry is that there are no, can be no, must be no biological differences between the sexes; all historical or current differences must be due to cultural brainwashing.

In his brilliant refutation of the women's liberationist Kate Millett, Irving Howe outlines several important biological differences between the sexes, differences important enough to have lasting social effects. They are

1. "the distinctive female experience of maternity" including what the anthropologist Malinowski calls an "intimate and integral connection with the child . associated with physiological effects and strong emotions";

2. "the hormonic components of our bodies as these vary not only between the sexes but at different ages within the sexes";

3. "the varying possibilities for work created by varying amounts of musculature and physical controls"; and

4. "the psychological consequences of different sexual postures and possibilities," in particular the "fundamental distinction between the active and passive sexual roles" as biologically determined in men and women respectively.

Howe goes on to cite the admission by Dr. Eleanor Maccoby in her study of female intelligence that

it is quite possible that there are genetic factors that differentiate the two sexes and bear upon their intellectual performance.. For example, there is good reason to believe that boys are innately more aggressive than girls - and I mean aggressive in the broader sense, not just as it implies fighting, but as it implies dominance and initiative as well - and if this quality is one which underlies the later growth of analytic thinking, then boys have an advantage which girls . will find difficult to overcome.

Dr. Maccoby adds that "if you try to divide child training among males and females, we might find out that females need to do it and males don't."

The sociologist Arnold W. Green points to the repeated emergence of what the egalitarians denounce as "stereotyped sex roles" even in communities originally dedicated to absolute equality. Thus, he cites the record of the Israeli kibbutzim:

The phenomenon is worldwide: women are concentrated in fields which require, singly or in combination, housewifely skills, patience and routine, manual dexterity, sex appeal, contact with children. The generalization holds for the Israeli kibbutz, with its established ideal of sexual equality. A "regression" to a separation of "women's work" from "men's work" occurred in the division of labor, to a state of affairs which parallels that elsewhere. The kibbutz is dominated by males and traditional male attitudes, on balance to the content of both sexes.

Irving Howe unerringly perceives that at the root of the women's liberation movement is resentment against the very existence of women as a distinctive entity:

For what seems to trouble Miss Millett isn't merely the injustices women have suffered or the discriminations to which they continue to be subject. What troubles her most of all . is the sheer existence of women. Miss Millett dislikes the psychobiological distinctiveness of women, and she will go no further than to recognize - what choice is there, alas? - the inescapable differences of anatomy. She hates the perverse refusal of most women to recognize the magnitude of their humiliation, the shameful dependence they show in regard to (not very independent) men, the maddening pleasures they even take in cooking dinners for the "master group" and wiping the noses of their snotty brats. Raging against the notion that such roles and attitudes are biologically determined, since the very thought of the biological seems to her a way of forever reducing women to subordinate status, she nevertheless attributes to "culture" so staggering a range of customs, outrages, and evils that this culture comes to seem a force more immovable and ominous than biology itself.

In a perceptive critique of the women's liberation movement, Joan Didion perceives its root to be a rebellion not only against biology but also against the "very organization of nature" itself:

If the necessity for conventional reproduction of the species seemed unfair to women, then let us transcend, via technology, "the very organization of nature," the oppression, as Shulamith Firestone saw it, "that goes back through recorded history to the animal kingdom itself." I accept the Universe, Margaret Fuller had finally allowed: Shulamith Firestone did not.

To which one is tempted to paraphrase Carlyle's admonition: "Egad, madam, you'd better."

Another widening rebellion against biological sex norms, as well as against natural diversity, has been the recently growing call for bisexuality by Left intellectuals. The avoidance of "rigid, stereotyped" heterosexuality and the adoption of indiscriminate bisexuality is supposed to expand consciousness, to eliminate "artificial" distinctions between the sexes and to make all persons simply and unisexually "human."

Once again, brainwashing by a dominant culture (in this case, heterosexual) has supposedly oppressed a homosexual minority and blocked off the uniformity and equality inherent in bisexuality. For then every individual could reach his or her fullest "humanity" in the "polymorphous perversity" so dear to the hearts of such leading New Left social philosophers as Norman O. Brown and Herbert Marcuse.

That biology stands like a rock in the face of egalitarian fantasies has been made increasingly clear in recent years. The researches of biochemist Roger J. Williams have repeatedly emphasized the great range of individual diversity throughout the entire human organism. Thus

Individuals differ from each other even in the minutest details of anatomy and body chemistry and physics; finger and toe prints; microscopic texture of hair; hair pattern on the body, ridges and "moons" on the finger and toenails; thickness of skin, its color, its tendency to blister; distribution of nerve endings on the surface of the body; size and shape of ears, of ear canals, or semi-circular canals; length of fingers; character of brain waves (tiny electrical impulses given off by the brain); exact number of muscles in the body; heart action; strength of blood vessels; blood groups; rate of clotting of blood - and so on almost ad infinitum.

We now know a great deal about how inheritance works and how it is not only possible but certain that every human being possesses by inheritance an exceedingly complex mosaic, composed of thousands of items, which is distinctive for him alone.

The genetic basis for inequality of intelligence has also become increasingly evident, despite the emotional abuse heaped upon such studies by fellow scientists as well as the lay public. Studies of identical twins raised in contrasting environments have been among the ways that this conclusion has been reached; and Professor Richard Herrnstein has recently estimated that 80 percent of the variability in human intelligence is genetic in origin. Herrnstein concludes that any political attempts to provide environmental equality for all citizens will only intensify the degree of socioeconomic differences caused by genetic variability.

The egalitarian revolt against biological reality, as significant as it is, is only a subset of a deeper revolt: against the ontological structure of reality itself, against the "very organization of nature"; against the universe as such. At the heart of the egalitarian Left is the pathological belief that there is no structure of reality; that all the world is a tabula rasa that can be changed at any moment in any desired direction by the mere exercise of human will - in short, that reality can be instantly transformed by the mere wish or whim of human beings. Surely this sort of infantile thinking is at the heart of Herbert Marcuse's passionate call for the comprehensive negation of the existing structure of reality and for its transformation into what he divines to be its true potential.

Nowhere is the left-wing attack on ontological reality more apparent than in the utopian dreams of what the future socialist society will look like. In the socialist future of Charles Fourier, according to Ludwig von Mises,

all harmful beasts will have disappeared, and in their places will be animals which will assist man in his labors - or even do his work for him. An antibeaver will see to the fishing; an antiwhale will move sailing ships in a calm; an antihippopotamus will tow the river boats. Instead of the lion there will be an antilion, a steed of wonderful swiftness, upon whose back the rider will sit as comfortably as in a well-sprung carriage. "It will be a pleasure to live in a world with such servants."

Furthermore, according to Fourier, the very oceans would contain lemonade rather than salt water.

Similarly absurd fantasies are at the root of the Marxian utopia of communism. Freed from the supposed confines of specialization and the division of labor (the heart of any production above the most primitive level and hence of any civilized society), each person in the communist utopia would fully develop all of his powers in every direction. As Engels wrote in his Anti-Dühring, communism would give "each individual the opportunity to develop and exercise all his faculties, physical and mental, in all directions." And Lenin looked forward in 1920 to the "abolition of the division of labor among people . the education, schooling, and training of people with an all-around development and an all-around training, people able to do everything. Communism is marching and must march toward this goal, and will reach it."

In his trenchant critique of the communist vision, Alexander Gray charges

That each individual should have the opportunity of developing all his faculties, physical and mental, in all directions, is a dream which will cheer the vision only of the simpleminded, oblivious of the restrictions imposed by the narrow limits of human life. For life is a series of acts of choice, and each choice is at the same time a renunciation.

Even the inhabitant of Engels's future fairyland will have to decide sooner or later whether he wishes to be Archbishop of Canterbury or First Sea Lord, whether he should seek to excel as a violinist or as a pugilist, whether he should elect to know all about Chinese literature or about the hidden pages in the life of a mackerel.

Of course one way to try to resolve this dilemma is to fantasize that the New Communist Man of the future will be a superman, superhuman in his abilities to transcend nature. William Godwin thought that, once private property was abolished, man would become immortal. The Marxist theoretician Karl Kautsky asserted that in the future communist society, "a new type of man will arise . a superman . an exalted man." And Leon Trotsky prophesied that under communism

man will become incomparably stronger, wiser, finer. His body more harmonious, his movements more rhythmical, his voice more musical.. The human average will rise to the level of an Aristotle, a Goethe, a Marx. Above these other heights new peaks will arise.

We began by considering the common view that the egalitarians, despite a modicum of impracticality, have ethics and moral idealism on their side. We end with the conclusion that egalitarians, however intelligent as individuals, deny the very basis of human intelligence and of human reason: the identification of the ontological structure of reality, of the laws of human nature, and the universe. In so doing, the egalitarians are acting as terribly spoiled children, denying the structure of reality on behalf of the rapid materialization of their own absurd fantasies. Not only spoiled but also highly dangerous; for the power of ideas is such that the egalitarians have a fair chance of destroying the very universe that they wish to deny and transcend, and to bring that universe crashing around all of our ears. Since their methodology and their goals deny the very structure of humanity and of the universe, the egalitarians are profoundly antihuman; and, therefore, their ideology and their activities may be set down as profoundly evil as well. Egalitarians do not have ethics on their side unless one can maintain that the destruction of civilization, and even of the human race itself, may be crowned with the laurel wreath of a high and laudable morality.

Murray N. Rothbard (1926-1995) was dean of the Austrian School. See his archive. Comment on the blog. This article is excerpted from the title essay and the introduction to the first edition of Egalitarianism as a Revolt Against Nature and Other Essays.

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Worse Than the Great Depression? November 18 8:26am

It's a minority but growing view, including from 86-year old former Goldman Sachs chairman, John Whitehead, at the November 12 Reuters Global Finance Summit in New York. As disturbing evidence mounts, he said: "I think it would be worse than the depression. We're talking about reducing the credit of the United States of America, which is the backbone of the economic system. I see nothing but large increases in the deficit, all of which are serving to decrease the credit standing of America.

Before I go to sleep at night, I wonder if tomorrow is the day Moody's and S & P will announce a downgrade of US government bonds. Eventually (they'll) no longer be the triple-A credit that they've always been. I've always been a positive person and optimistic, but I don't see a solution here." Powerful words from a man who "want(s) to get people thinking about this, and realize (we're on) a road to disaster."

A subject writer, precious metals analyst, and Safe Money Report editor Larry Edelson also comments on. Most recently on November 13 in an article titled: "The G-20's Secret Debt Solution." He's quite dire in saying short-term fixes won't be discussed at its November 15 summit. A "far more fundamental fix is being (secretly) discussed - the possible revaluation of gold and the birth of an entirely new monetary system." It's a topic Edelson has spent much time on previously.

Given the speed and severity of the current crisis, he believes something big is planned and puts it this way: "If we can't print money fast enough to fend off another deflationary Great Depression, then let's change the value of the money." In other words, devalue it, but do it globally. "It would be a strategy designed to ease the burden of ALL debts - by simultaneously devaluing ALL currencies (or at least all that matter) and re-inflating ALL asset prices."

Edelson thinks G-20 officials will discuss this seriously. Essentially, the idea of "a new financial order that includes new monetary units that (will help) wipe clean the world's debt ledgers." At best, it will be a tough sell given that the US, by far, is the world's largest debtor and the one most in need of help. The urgency for all others is that if America sinks, it'll drag down all world economies with it, so it's possible some kind of solution will be arranged. But it's not assured, nor can it be ruled out that the summit will be stalemated as every nation has its own concerns and its own constituency to serve.

Edelson believes that key US officials, including Fed chairman Bernanke, Treasury secretary Paulson, and president-elect Obama back the idea, and (most but not all) key world central bankers and politicians agree that a new monetary system is needed.

Consider a historical precedent at a previous dire time - the Great Depression. In April 1933, Roosevelt issued Executive Order (EO) 6102 that stated:

....a "national emergency still continues to exist (and) by virtue of the authority vested in me....(I) do hereby prohibit the hoarding of gold coin, gold bullion, and gold certificates within the continental United States by individuals, partnerships, associations and corporations...."

The EO required the delivery on or before May 1, 1933 "to a Federal Reserve Bank or a branch or agency thereof" all such holdings other than amounts used in industry, profession or art and other listed exceptions. Failure to comply carried a fine up to $10,000 (adjusted for inflation today would be 16 times or more that amount), up to 10 years in prison or both. This EO is called the Gold Confiscation (act) of 1933. It's price at the time was $20.67 an ounce. Shortly thereafter, it was raised to $35 an ounce for an effective US dollar 41% devaluation.

What Edelson is suggesting is that world economies together will do the same thing - "a simultaneous and universal currency devaluation" without confiscating gold. They don't have to and instead can "raise the current official central bank price from its booked ($42.22) value an ounce - to a price that monitizes a large enough portion of the world's outstanding debts."

If this happens, debts will be reduced to a fraction of re-inflated asset prices "led higher by the gold price." Further, Edelson believes, in place of the dollar as a reserve currency, "three new monetary units of exchange (will emerge) with equal reserve status" - a new dollar, euro and "a new pan-Asian currency" with the Chinese yuan likely surviving and linked to a basket of the other three.

With devaluation, new currencies will be worth less than the old ones by a considerable amount. For example, "10 new units of money (may then equal) one old dollar or euro." They'll have new names as well, and new "regulations and programs would be designed and implemented to ease the transition to a new monetary system" - if it happens and it's by no means assured.

But if it does, central banks and governments would run things along with the IMF that's had contingency plans for such an eventuality since it was established in 1944. According to Edelson, a new monetary system will include the following:

(1) A new fixed-rate currency regime

Once the price of gold is increased and new currencies introduced, "a new fixed exchange rate system" will be introduced. The floating one and old currencies will be eliminated to reduce market volatility.

(2) New compensatory measures for savers

They'll be introduced as an inducement and to protect against further devaluation. For example, a possible "one-time windfall tax-free deposit could be issued directly to individual accounts or to employer-sponsored pensions, to IRAs, or Social Security accounts." Something like a tax rebate. At the same time, income taxes may be raised to cover the cost or perhaps some kind of global sales tax instead.

(3) Additional programs to protect lenders and creditors

They'll get top priority over individuals but with a currency worth far less than before. So programs will be needed (like tax help) to help them offset the losses that will be considerable.

Can this work? Edelson thinks so as hard as the medicine would be to swallow. Also, it's not a recipe for high growth rates or improved returns on investments the way it was in the great bull market now ended.

Another issue is what gold price would be legislated to reflate world economies. Who can say, but here are some possibilities Edelson sees, and note the dramatic effect on the precious metal if he's right:

-- if 100% of public and private sector debt is monetized, "the official government price of gold would have to be raised to about $53,000 per ounce;"

-- at 50% monitization, gold would be $26,500 an ounce;

-- at 20%, it would be $10,600 an ounce; and

-- at 10%, it would be $5300 an ounce.

The lowest figure isn't outlandish in light of historical precedent. Gold hit $850 an ounce in 1980. In CPI inflation-adjusted terms, around $2300 an ounce would equal it today. But if the government hadn't cooked the CPI calculation to keep it low, the number would be about $6250 an ounce. So if a devaluation occurs, perhaps even $10,600 might not seem unusual.

Edelson bases his numbers on US debt only because this country is the world's largest debtor and at "the epicenter of the crisis." He won't be surprised if "the G-20 monetize(s) at least 20% of the US debt markets." If so, he sees gold at over $10,000 an ounce along with currency devaluations "by a factor of at least 12 to 1, meaning it would take 12 new dollars or euros to equal 1 old dollar or euro."

A gold standard isn't needed because central banks need only monitize and reduce their debt burdens "via inflating asset prices in fiat money terms." The obvious question is what to do if he's right. Think gold, and in his judgment, make it "as much as 25% of your investable funds." He's not alone recommending this, including others who believe America is insolvent, will simply default on its debt, perhaps create a new currency as Edelson believes, and do it sooner than most people imagine. Next year perhaps because conditions are so dire and deteriorating fast.

Macro data keep confirmng it. The latest on November 13 with initial unemployment claims at 516,000 or the highest since September 2001. Continuing claims are at the highest level since 1983. For the week ending November 1, the seasonally adjusted insured unemployment advance number was 3,897,000 or an increase of 65,000 from the preceding week.

Crucial to understand is that these figures are grossly understated given the numbers of discouraged workers, part-time and occasional ones, and other ways the government cooks the books to soften or otherwise alter all types of "official" data. None of it, including GDP, inflation, and the rest is reliable. For unemployment, a good rule of thumb is to double the announced figures, so the Labor Department's reported 6.5% is, in fact, around 13% and rising.

In addition, housing continues to deteriorate. Large builder Toll Brothers president, Bob Toll, says "These are bad times if there ever were" any. Along with declining prices and rising foreclosures, it shows in new mortgage application figures - down 40% from a year earlier and no evident leveling off signs.

Still more bad news on November 14 with the Commerce Department reporting October retail sales plunging a record 2.8% after falling the previous three months. Even excluding a 5.5% drop in auto purchases, they fell a record 2.2% with lower gasoline prices accounting for much of the drop. Nonetheless, numbers were down across the board, and August and September figures were revised lower signaling a poor holiday shopping season and very bleak Q 4 that's certain to continue into the new year.

Some observers believe that these and other data lie behind Paulson abandoning his toxic asset purchase plan to give more to "nonbank financial institutions, like insurers and speciality-finance companies" as well as to "Shift Focus in (the) Credit Bailout to the Consumer," according to The New York Times. Others see the Treasury in disarray and still others think the original plan was a head fake, and all along Paulson had other things in mind and will gradually unveil them. They'll offer little for beleaguered households if anything at all.

Details on his newest plan are vague, but apparently consumers won't directly benefit. Around $50 billion will be for a new loan facility to help companies issuing credit cards, making student loans and financing car purchases. It means maxed out households won't be able to borrow because they're already overextended, and lenders will only do business with good credit risks.

Nonetheless, this is the latest twist in what some critics call making Treasury policy on the fly. First toxic asset purchases, then bank recapitalizations and various other handouts, and now the vague outlines of a new plan just announced. Tomorrow something else in the wake of the G-20 November 15 summit.

Its official 47-action items statement (drafted well in advance of the meeting) was in the usual type political-speak. According to The New York Times, "leaders of 20 countries agreed Saturday to work together to revive their economies, but they put off thornier decisions about how to overhaul financial regulations until next year (when it plans) its next meeting for April 30, 101 days after (Obama) is sworn into office." Whatever is finally agreed on, this much for certain is clear. Unchanged Washington/Wall Street dominance is planned along with putting the IMF in charge of global "neoliberalizing" with all its destructive fallout.

A Long-Term View on the Depression

It's from noted sociologist, social scientist and world-systems analyst Immanuel Wallerstein, now a Senior Research Scholar at Yale where he covers world-systems in three ways:

-- the historical development of the modern world-system;

-- the contemporary crisis of modern world-economy capitalism; and

-- structures and knowledge.

He's authored numerous books and writes regular commentaries on major world and national topics. A recent October 15 one is titled "The Depression: A Long-Term View."

It's started in his view. We're "at the beginning of a full-blown worldwide depression with extensive unemployment almost everywhere. It may take the form of a classic nominal deflation (or less likely) a runaway inflation, which is simply another way in which values deflate." What caused it, he asks? Derivatives? Subprime mortgages? Oil speculators? It's a "blame game of no real importance."

Understanding it calls for far more revealing factors, such as "medium-term cyclical swings (and) long-term structural trends." Over several hundred years at least, he describes two major ones. "One is the so-called Kondratieff cycles that historically" lasted 50 - 60 years. The other is called "hegemonic cycles" that are much fewer in number but last far longer.

America contended for hegemony as early as 1873, achieved it fully in 1945, and has been declining since the 1970s. "George W. Bush's follies have transformed a slow decline into a precipitate one. And as of now, we are past any semblance of US hegemony. We have entered, as normally happens, a multipolar world. The United States remains a strong power, perhaps still the strongest, but it will continue to decline relative to other powers in the decades to come." Nothing can change this.

Kondratieff cycles are timed differently. Its last B-phase ended in 1945, followed by "the strongest A-phase upturn in the history of the modern world-system." It peaked around 1967 - 73, and headed down. "This B-phase has gone on much longer than previous (ones) and we are still in it."

Its characteristics are as follows:

-- "profit rates from productive activities go down, especially in those types of production that have been most profitable;"

-- it directs capitalists to financialization and speculation for higher returns; and

-- "productive activities, in order not to become too unprofitable, tend to move from core zones (like America) to (lower cost) parts of the world-system."

Speculative bubbles are profitable while inflating, but they always burst. "If one asks why this Kondratieff B-phase has lasted so long, it is because the powers that be (the Treasury, Fed, IMF, and western European and Japanese collaborators) have intervened in the market regularly and importantly" to shore it up at times of economic disruptions - 1987, the 1989 S & L crisis, 1997 Asian contagion, 1998 Long Term Capital Management debacle, the 2001 - 2002 corporate scandal period, and more than ever today with big unanswered questions whether this time it will work.

It doesn't matter because we've reached the limits of what can be done - "as Henry Paulson and Ben Bernanke are learning to their chagrin and probably amazement. This time, it will not be so easy, probably impossible, to avert the worst."

In earlier depressions, innovations and quasi-monopolies helped world economies recover. In the late 1930s, WW II played the major role. Today things are different and "may interfere with this nice cyclical pattern that has sustained the capitalist system for some 500 years." They're new structural trends, according to Wallerstein. "The problem with all structural equilibria of all systems, is that over time the curves tend to move far from equilibrium (and it's) impossible to bring them back."

What happened this time? It's "because over 500 years the three basic costs of capitalist production - personnel, inputs, and taxation - have steadily risen as a percentage of possible sales price (so) today (it's) impossible to obtain the large profits" that previously were the "basis of significant capital accumulation." It's the result of capitalism working so well that it finally "undermined the basis of future accumulation."

At this point, the system "bifurcates." The immediate consequence is high chaotic turbulence (now ongoing) and will continue....for perhaps another 20 - 50 years. From the chaos "one of two alternate and very different paths" will emerge.

The present system won't survive. A new one will replace it. It will not be capitalism as we know it, but may be far worse or far better (more democratic and egalitarian). Determining the outcome is "the major worldwide political struggle of our times."

In the short-term, we're moving into a "protectionist world (forget about so-called globalization)." Governments are getting more into production - even in America and Britain. We're also moving more into "populist government-led redistribution," either in a left-of-center social democratic form or a far right authoritarian one. "And we are moving into acute social conflict within states, as everyone competes over the smaller pie. In the short-run, it is not, by and large, a pretty picture."

A Brief Summary of Nouriel Roubini's Latest Views

As of November 11, he says "the US will experience its most severe recession since WW II, much worse and longer and deeper than even (in) 1974 - 75 and 1980 - 82." It'll last through 2009 and cause a "cumulative GDP drop of over 4%." Unemployment will likely reach 9%. The US consumer is debt burdened, saving less and faltering: "this will be the worst consumer recession in decades."

A V-shaped recovery "is out the window." In prospect is either a U-shaped 18 - 24 months recession or a worse multi-year L-shaped one similar to what Japan experienced in the 1990s. Economist Michael Hudson sees an L-shaped depression ahead, more severe than what Roubini forecasts who doesn't rule out something worse than he imagines.

As a result, president-elect Obama "will inherit an economic and financial mess worse than anything the US has faced in decades:" the worst recession in 50 years;" the worst financial and banking crisis since the 1930s; a massive fiscal deficit; a huge current account one; "a financial system that is in a severe crisis and where deleveraging is still occurring at a very rapid pace," thus making the credit crunch worse; a household sector in disarray with millions insolvent and forclosures rising; the risk of serious deflation; a liquidity trap for the Fed as well; and "the risk of a severe debt deflation as the real value of nominal liabilities will rise given price deflation while the value of financial assets is still plunging."

Worse still, this is happening globally, even in mighty China that could see its market peak 12% growth rate plunge to 6% for a "hard landing." Emerging economies will be very hard hit, and advanced ones "will face stag-deflation (stagnation/recession and deflation)."

In countries like the US, Japan and possibly others, interest rates may reach zero with serious potential consequences if it happens. "Zero-bound on interest rates implies the risk of a liquidity trap where money and bonds become perfectly substitutable, where real interest rates become high and rising thus further pushing down aggregate demand, and where money fund returns cannot even cover their management costs."

Deflation also affects debt. At nominal values it will rise and thus increase its real burden. As for monetary policy, no matter how aggressive it gets, it will be "pushing on a string given the glut of global aggregate supply relative to demand (plus) a very severe credit crunch."

With this in mind, projected 2009 earnings are "delusional" and will have to be lowered sharply. As a result, view equity rallies as sucker rally bear traps, and Roubini has a cartoon to explain them:

-- top graphic: broker saying "I've got a stock here that could really EXCEL"....really excel someone asks?..another asks "EXCEL?"...still another thinks "SELL," then everyone yells "SELL;"

-- bottom graphic: everyone yelling "SELL"....one voice saying "This is madness! I can't take anymore, goodbye!" Good bye, someone asks? Buy? - asks another, and then everyone yells BUY!!

Michel Chossudovsky, Ellen Brown and others explain what's really going on. It's not pretty or what Wall Street wants investors to know. That markets are heavily manipulated. Speculation drives them up and down, and very visible (insider) hands profit hugely in either direction.

Chossodovsky: "With foreknowledge and inside information, a collapse in market values constitutes a lucrative and money-spinning opportunity, for a select category of powerful speculators who have the ability to manipulate the market in the appropriate direction at the appropriate price" - and he explains the various ways how.

Brown on the "Plunge Protection Team (PPT): it's "the group set up under President Reagan to maintain market 'stability (profitable instability also) by manipulating markets behind the scenes."

In other words, financial markets are rigged. "Free" ones don't exist except in the mind's eye of the innocent. They represent no collective wisdom other than the speculators who manipulate it for profit.

Brown: "In a rigged pseudo-capitalist economy, investors are easily separated from their money because they expect the market to follow 'free market principles' based on 'supply and demand.' They are seduced into 'pump and dump schemes" and fleeced.

In today's market climate, trusting in Adam Smith's "invisible hand" is a very hazardous exercise. Brown again: "The market today is indeed controlled by an invisible hand, but it is not necessarily serving the interests of small investors."

Paul Krugman on A Possible Depression

He doesn't expect one, but he's worried at a time when we're "well into the realm of what (he calls) depression economics." He means "a state of affairs like that of the 1930s in which the usual tools of economic policy - above all, the Federal Reserve's ability to pump up the economy by cutting interest rates - have lost all traction. When depression economics prevails, the usual rules of economic policy no longer apply: virtue becomes vice, caution is risky and prudence is folly."

He cites one piece of macro data, among many others, as an example - new unemployment insurance claims (mentioned above) that are high, rising, but not unusual in recessionary times. Standard policy is to cut the fed funds rate, but today doing it is "meaningless." It's officially at 1%, but it's "averaged less than 0.3 percent in recent days," so there's nothing left to cut.

Krugman suggests a huge $600 billion stimulus package, but even that could fall far short, especially if it causes as much destabilization as the Paulson bailout schemes - designed to wreck the economy, not heal it, so powerful interests can grow more powerful and do it with taxpayer dollars.

New Programs for Old Add Up to Same Old, Same Old

Shifting focus to bailing out consumers was covered above and explained as a way to help companies, not households. It's more Bush administration deception that will continue seamlessly under Obama, and just look at his major Wall Street contributors for proof. He fully supports aiding them at a time one observer calls the Treasury "privatized," and it's no secret that it's being looted.

Then there's (supposed) mortgage aid for beleaguered homeowners that falls way short of helping them. Quite the opposite in fact. The newly announced plan is more old than new and only to keep under water owners from deserting their properties and renting. The idea is for lower rates, extended loan terms, lower payments, and adding unpaid balances to principal. It's called negative amortization - when monthly payments are less than the full interest amount due. The interest accrues and principal balances increase, only putting off an eventual day of reckoning for a later time when prices of homes will be lower and owners even less able to afford them.

In others words, the solution is worse than the problem. It will sink owners more under water than at present, delay their defaulting for a later time, turn owners into levered renters, drive them deeper into debt, ensure continued foreclosures for many years to come, and end the dream of home ownership for millions. It will also discourage millions more from wanting one.

And there's more to this ugly plan. There's a catch. It focuses on loans Fannie and Freddie own or guarantee. They dominate half the mortgage market and have about 20% of delinquent loans, so far. Even FDIC chairman, Sheila Bair, is critical saying the plan "falls short of what is needed to achieve wide-scale modifications of distressed mortgages." She wants some TARP money for "fixing the front-end problem: too many unaffordable home loans," but what's needed is an entirely new plan.

One designed to work. With affordable monthly payments, principal balances reduced, and lenders required to eat losses on deceptive loans they never should have made in the first place. The proposed plan is designed to fail, and it's typical of how Washington operates. It was announced by the Federal Housing Finance Agency (FHFA), the same one that seized Fannie and Freddie in September.

On November 13, FDIC officials unveiled their own plan that improves on FHFA's but not enough. It's only for 1.5 million homeowners facing foreclosure in 2009. Its cost is an estimated $24.4 billion, and even so Henry Paulson opposes it because it taps a small portion of his TARP money.

Borrowers who've missed at least two monthly payments will be eligible for a reduced amount - at no more than 31% of their monthly income compared to the 28% of the pre-tax amount lenders once deemed affordable.

In exchange, mortgage companies will be guaranteed that if borrowers fall behind on their payments and they lose money, Washington will cover half of their loss in most cases. The plan's estimated cost is based on the assumption that only one in three borrowers with modified payments will be unable to make them. Currently, nearly half of borrowers under such plans default, so it's doubtful FDIC's plan will work, especially with home prices still falling and likely to bottom well below current values.

Nonetheless, leading congressional Democrats are supportive, and Senate Banking Committee chairman, Chris Dodd, said he'll introduce legislation to let bankruptcy courts modify mortgage loans. It's something consumer advocates want badly and the banking industry strongly opposes. It remains to be seen what kind of new law passes (if any), and despite expressing support for one during his campaign, rest assured that Obama will do nothing to harm his core constituency - his powerful Wall Street backers.

He'll likely let banks set their own terms for their own benefit to the detriment of homeowners. The way it usually works in the end. Further, arrangements announced, in place or planned can't stop foreclosures from rising. Increasing unemployment will intensify the problem. Many borrowers overstated their incomes and can't even handle reduced payments. Others were speculators on second homes and don't qualify.

In addition, home prices keep falling with no end of it in sight. Growing millions of owners are under water owing far more than their properties are worth and assuring many will default and simply rent - for less than they're now paying.

Further, securitizing mortgages complicates who owns them. Except for Fannie and Freddie, they're not your local bank or S & L in most cases, but foreign investors, hedge funds, and all sorts of other non-traditional mortgage paper holders. Usually ones homeowners can't meet with face-to-face, and if they could would be rebuffed. "Servicers" won't modify loan terms because doing so lowers their value for investors and likely would invite lawsuits.

It's another wrinkle in a complicated situation with homeowners at the bottom of the food chain being squeezed, short of major government help not forthcoming or likely in the new year. For them and most others, trouble is baked in their cake that they're now being force-fed to eat.

In greater portions after the Office of the Comptroller of the Currency refused to let lenders forgive large amounts of credit card debt. As much as 40% for consumers who don't qualify for existing repayment plans.

A rare financial industry and Consumer Federation of America alliance asked the Treasury Department for help on October 29 for very logical reasons. Consumers need it as well as credit card lenders for a way to mitigate growing losses - by assuming small in lieu of total ones and getting extended write-off periods.

But consider how over-indebted individuals may react if they're smart. Why pay anything when it's simpler to default and walk away. For those strapped enough, it's what growing numbers are choosing and the reason lenders like JP Morgan Chase, Citigroup, and Bank of America (already reeling from bad mortgage debt) are concerned enough to seek relief.

Instead, they should be held accountable for their fraud. For destroying savings, pensions, and for growing millions their homes and futures. For charging usurious interest and late charges on credit card balances. For gaming the system for decades but now out of their food source. Instead of help, have them give back and make it on their own, or step aside, be nationalized, and turn them into a public utility, on a level playing field, to serve the greater good for everyone.

Their due reward for what Paul Craig Roberts calls "unregulated banksters and Wall Street criminals, greedy CEOs, and a no-think economics profession (for having) destroyed America's economy," and now wanting to be saved from their own transgressions. Rebalance the tax code instead, make it progressive, and soak the rich, not the poor. It was the original idea in the first place at a time low income earners paid nothing. Today they're overburdened, overtaxed, out of work, and out of hope during the most serious disruption in our history.

They're not offered part of the latest bank handout that's little more than naked theft on top of all of it earlier. This time with another $140 billion windfall that was in a September 30 Treasury Department memo. According to tax experts, it overstepped its authority by overturning section 382 of a 1986 law curtailing the outlandish corporate gaming of the tax system. It nets Wells Fargo $25 billion for its Wachovia takeover and PNC bank $5.1 billion in acquiring National City. Future acquisitions will enjoy similar benefits with taxpayers getting the bill.

This also helps big banks acquire smaller ones, concentrate more power in their hands, and head them closer to near-monopoly control over the entire financial system. A privatized Treasury indeed - with bipartisan support and by the new president-elect.

His new Treasury secretary will maintain the status quo or even sweeten it at a time when ordinary households are in deep distress with little help in prospect beyond measures too inadequate to matter.

According to the New York and London-based CreditSights research firm, it's $5 trillion and counting for fraudsters and bare crumbs for the public. At a time economies are sinking into recession, unemployment and poverty rising, and mayor Richard Daley of this writer's Chicago warning of "huge" layoffs to come.

He compared now to the 1930s and said: "We never experienced anything like this except (for those) people who came from the Depression. When you have that many layoffs early (referring to the city's and what corporate heads tell him) - and they're telling me this is only the beginning of their layoffs - that is very frightening."

Daley warned that local governments could face bankruptcy at a time Chicago-based Challenger, Grey & Christmas outplacement consultant reported that US job cuts reached a five-year high in their latest numbers and are rising across the board.

It's just as bad for Illinois (and other states) according to Bloomberg. The state "is $4 billion behind in paying bills to its suppliers of goods and services," Comptroller Dan Hynes said. "Vendors face a 12 week delay in getting paid, and the wait may extend to 20 weeks" as conditions deteriorate further. "The unprecedented backlog of bills might grow to $5 billion by March. To call this an imminent crisis is an understatement," and it's affecting all state services. In other states as well across the country.

Even the mighty New York Times is hurting. It's fallen on hard times and may be a metaphor for the country. In 2002, its stock price hit nearly $53 a share and is now below $7.50 (as of November 14), down about 86%. It also owes lenders around $400 million by next May, has a mere $46 million on hand, and it needs all of it and more for operating expenses at a time one observer suggests that the Grey Lady may need to change its slogan to "Less News and Less Money To Print It."

Maybe none according to its publisher Arthur Sulzberger Jr. months back at the Davos, Switzerland World Economic Forum. He said "I really don't know whether we'll be printing The Times in five years, and you know what? I don't care either" because the paper is emphasizing internet news and doubled its online readership to 1.5 million.

Well and good but it hasn't enough online advertising to make up for what it's losing in print, and given today's climate, it may run out of time to make up the shortfall and stay viable. That may prove the epitaph for growing numbers of venerable (and now vulnerable) American and global companies at perhaps the most challenging time in their histories.

A Final Comment

How did it come to this in the first place? In a word: out-of-control excess yields even greater payback, and the only cure for bubbles (according to noted economist Kurt Richebacher) is to prevent them from developing.

The ones now deflating are unprecedented in their size and severity. No amount of policy making magic will easily fix them. America and world economies face a long, painful period ahead, likely more than at any other time in history with no clear idea what will emerge in the end. As one observer puts it: "All we know is that nobody knows."

What's known in the shorter term is what Michel Chossudovsky observes: "The financial crisis is deepening, with the risk of seriously disrupting the system of international payments. (This time) is far more serious than the Great Depression. All major sectors of the global economy are affected (and TARP and related schemes are) not a 'solution' to the crisis but the 'cause' of further collapse" - by design.

So what long-term lessons will be learned when the dust finally settles? According to money manager and market strategist Jeremy Grantham: "absolutely nothing" or put another way - those who don't heed the lessons of the past are condemned to repeat them.

Policy makers won't change. Before whatever comes out of this in the end, plenty of pain will precede it, then past sins will repeat, and we'll go through the whole cycle again - if we make it through this one.

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Stephen Lendman [send him email] lives in Chicago, and maintains a blog at http://sjlendman.blogspot.com. He hosts "The Steve Lendman News and Information Hour" online at www.themicroeffect.com, and is the author of The Iraq Quagmire: The Price of Imperial Arrogance.

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Fleeting prosperity, courtesy of our grandchildren November 18 7:25am

Why, we ask ourselves, do so many world leaders continue to pay homage, no matter how subdued, to this American government that has served the people of this planet so poorly as both conservator of resources. and as defender of human life and dignity?

Can anybody make sense in accepting George W. Bush as the pied piper leading the way to the convocation of an emergency economic summit of G20 Leaders hoping to cope with, and ameliorate, the meltdown now appearing in the global economy?  Never mind that the Bush Administration bears much of the responsibility for such meltdown!

Welcome to Washington, see of military and economic might!  Welcome to the Basilica of the Two Altars: "Capitalism" and "Democracy," with Bungling Bush as Supreme Pontiff.  The inseparability of capitalism and democracy has come to be in America an act of faith, at least for two generations, under the constant brainwashing of both government and business, something that continuously travels from the ridiculous to the sublime as democracy becomes conspicuous by its absence - in politics - and capitalism shows its predatory and inhumane face, nothing resembling the clean and smooth features we associate with true free enterprise.

Bailouts and stimuli have been the magic potions carried in the conversations of all these folks coming to Bush's shindig, all present for little more than a photo-op. since there was never a chance that guests to the High Mass at the Basilica could convince the High Priest that regulations, adequately enforced, are the only way to keep capitalism honest and manageable. 

Too late for the current crash for, after all, this incredible excuse for a world leader will be put to pasture in two months.  Just why did all these leaders accede to come to Washington when all they needed to do was decide on a meeting place where they could all meet in February with young Obama?!   

Perhaps a return to the Azores. was suggested by a Spanish journalist friend; but this time to promote world peace and meaningful economic remedies in contrast to the March 16, 2003 performance of the 2 ½ Tenors (Bush, Blair and Aznar) - my friend always thought of the then Spanish head of state as half-baked - and their strident "Ultimatum to Saddam" aria sang as a battle cry to invade a sovereign nation: Iraq.

One might have expected some acrimony at this meeting, particularly from Britain's Brown or France's Sarkozy; after all, we flooded their countries, as well as many others, with our worth-less paper but they'll get their chance to upstage Obama, or at least try, after he takes the reins.  Of course, the US is not entirely to blame for their economies' meltdown; they did a creditable job imitating us in many "capitalist" pyramid schemes.

As I stated six weeks ago, as Secretary Paulson delivered his economic bad tidings asking for a rescue package "or we were all going to drown," the decision could have waited until such time as people, not just Congress, were told in a clear manner both truth and consequences. something which wasn't done.  And, to date, that truth has not been provided by our government, nor does it appear that it will soon be; not before our national debt reaches a level as high as the nation's annual GDP (Gross Domestic Product), or even past that point; and by then it will be too late, with more than 80 percent of Americans, politically clueless and with little if any wealth left, will be caged in economic captivity to predatory Corporate America. 

Why the truth now?  So we may accept a 20 or 30 percent cut in a standard of living that was never ours by right, and accept it as a clean start; perhaps after criminally indicting those who contributed to get us where we are today.  Cancel all the stupid reality shows on television and broadcast instead the biggest reality show where we are all cast; instill some measure of civic education and common sense, while ceasing to treat citizens as imbecilic consumers.

As for Detroit's problem and a requested second $25 billion bailout installment of, one guesses, many more to come, politicians - in this case Obama and Congress - should do one of two things: let the Midget-3 deservedly go under, or purchase all outstanding stock in GM, Ford and Chrysler at a fraction of the current price; then, offer to sell it to the employees under some plan that would seem viable, permitting the continuance of manufacturing autos in America. 

Stockholders and management have failed miserably, why not now give a chance to labor?  Unfortunately, either of these two unpalatable choices has too great a political risk for both the President-elect and the congressional Democrats.  So, once again, our government will screw up. and the taxpayers will end up paying the freight for another ticket to nowhere.

What seems out of place, totally absurd, is for Bush, smile on his face, to continue touting a totally opaque and thieving economic system, ringing out the twin bells of capitalism and democracy.  And to think, he does so with impunity, and without any reasonable challenge!

For now, let's thank our grandchildren for having gifted us with this undeserved round of prosperity we have indulged in during these last few years.  Our legacy doesn't seem to be much better than Bush's, does it?

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Ben Tanosborn [send him email] writes a weekly socio-political column, Behind the mirror, which can be found at www.tanosborn.com Write to Ben Tanosborn at P.O. Box 2324, Vancouver, WA 98668.

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More fiat money won't solve this crisis November 18 6:25am

It is often said "there are no atheists in a foxhole." The other week, as world financial markets melted down, CNBC go-to wise man Art Cashen put a market spin on that familiar line drolly saying, "there are no libertarians in a market crash."

The crusty Cashen is certainly right for the most part. Plenty of financial talking heads who argue for free markets and smaller government on a daily basis suddenly screamed that government must intervene to "save capitalism." Of course, the idea that government must print multiple blizzards worth of money to save a system where individuals and businesses trade with each other unfettered makes as much sense as presidents who claim that war must be waged to "protect the peace."

The fact is that what we've been enjoying since the Federal Reserve was created is anything but free-market capitalism. The value of the dollar has been pushed down 99 percent and the economy has been a series of booms, followed by busts, ad nausea since J.P. Morgan partner Harry Davidson and other big bank chieftains secretly took a train to go duck hunting on Jekyll Island in 1910.

Of course, the ducks were safe, but Americans since have paid the price for the Federal Reserve System idea that was hatched that weekend. As historian Gabriel Kolko wrote: "The entire banking reform movement, at all crucial stages, was centralized in the hands of a few men who for years were linked, ideologically and personally, with one another ... the major function, inspiration and direction of the measure [the Federal Reserve Act] was to serve the banking community in general, and large bankers specifically."

The TV pragmatists probably forget that Karl Marx and Frederick Engels wrote in The Communist Manifesto that creating "a centralization of credit in the hands of the state, by means of a national bank with state capital and an exclusive monopoly" should be near the top of any communist's agenda.

Is it any wonder that Treasury Secretary Henry Paulson's plan has morphed into the federal government taking equity stakes in banks, mortgage companies and at least one insurance company? As Oscar B. Johannsen wrote: "A socialized banking system is the precursor of socialism in all business." (By the time you read this, airlines and car manufacturers may be partially owned by the government).

But the level of economic knowledge displayed in main street print or on TV has dropped lower than the Dow Jones Industrial Average. Economist and historian Tom DiLorenzo got an earful on MSNBC's "Morning Joe" program recently from former Republican presidential candidate Pat Buchanan who admonished DiLorenzo: "How could you criticize Hamilton? He's the architect of the American economy!"

DiLorenzo's new book Hamilton's Curse shows us that Buchanan and other Alexander Hamilton apologists have it all wrong. "Hamilton was an enemy of free-market capitalism and early America's foremost proponent of mercantilism, the system of government-granted monopolies, corporate welfare, protectionist tariffs and other policies that generally benefited politically connected businesses at the expense of the rest of society," DiLorenzo explains.

As Lew Rockwell points out, the real cause of the current financial crisis can be summed up with two words: fiat money. The word fiat means, out of nothing. And since 1971, when Nixon proclaimed, "We are all Keynesians now" and severed the last link that tied the dollar to gold, the amount of dollars created by the Fed out of nothing has grown over 10 times as measured by M-2 (from $685 billion in August 1971 to $7.7 trillion in August 2008).

As if all this past monetary expansion wasn't enough, the Fed is now working overtime, in concert with the world's other central banks, to create what investor Jim Rogers told a foreign CNBC audience will be "a monetary holocaust."

Rogers didn't make any friends with others on Wall Street with those comments. As Rockwell points out: "The best way to fall out of favor with the regime - or its pseudo-libertarian and neocon supporters - is to question its central bankers."

But, history is clear, more fiat money won't solve this crisis; a return to sounder money will.

Doug French is executive vice president of the Ludwig von Mises Institute and associate editor for Liberty Watch Magazine. He received the Murray N. Rothbard Award from the Center for Libertarian Studies.

Copyright © 2008 Doug French

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Unsettling Signs November 17 1:05pm

There are a few buzzwords that every American politician, aiming for high office must utilize, even if disingenuously, to have a reasonable chance at getting elected.

President-elect, Barak Obama's constant use of terms like 'hope' and 'change' contributed greatly to the overwhelming support he has experienced by the American public. Many, admiringly so, have overcome a legacy of racial division and prejudice that has defined America for decades, if not centuries. In that regard, voting to office a bi-racial candidate is truly an historic event.

John McCain had an impossible disadvantage to overcome, and failed miserably. He was judged largely based on the many blunders of Republican President George W. Bush, and was evidently caught between a rock and a hard place: to distance himself completely from Bush's legacy, he would risk losing a large margin of his conservative base; to embrace it completely, he would have no chance of broadening that already shrinking constituency.

Thus, he too resorted to clichés and buzzwords, which eventually lost any relevance and merely constituted ample material for television comedians: 'maverick', 'straight talker', and, of course, 'Joe the Plummer.'

His desperate and repeated attempts to breathe life into and push forward his under funded, unpopular campaign were of no use. However, his choice of Alaska's governor Sarah Palin as his running mate might go down in history as his greatest blunder of them all. 

The fact is, both candidates, McCain and Obama, had much more in common than they would care to admit, as they voted to fund the Iraq war, supported offshore drilling, backed the plan to bail out Wall Street, appealed to the 'middle class', never the many millions of poor Americans, and brazenly demonstrated their undying love for Israel, right or wrong.

Any truly independent assessment would most likely show that commonalities between both candidates - especially towards the end of their campaigns - ran too deep that would render designations of them as 'opponents', engaged in constant 'debates', particularly puzzling.

Each candidate also exploited certain advantages over the other. Watching Hilary Clinton's frenzied yet futile campaign to secure the Democratic Party nomination, McCain learned to be very vigilant while scorning his opponent. Any remark that could be misconstrued as a racial commentary was avoided at every turn. Aside from all sorts of anti-Muslim and anti-Arab remarks, actions and inactions, the McCain-Palin campaign steered clear of the issue of race. At one point, McCain assured an anxious supporter of him that Obama is not an Arab, but a "decent family man."

Obama too would tirelessly acknowledge that his opponent was a great "American hero." Not one mainstream news network, commentator or 'expert' failed to solemnly accept McCain's heroism while serving as a Navy pilot in Vietnam, and for having his aircraft shot down in the fall of 1967 on a routine bombing mission in Hanoi. McCain's heroic mission entailed the leveling of a power plant in a heavily populated area.

Naturally, little is known about the Vietnamese victims of McCain's 'heroic' missions, for whom the 'straight talker' had nothing but utter disdain. "I will hate them as long as I live," he told reporters in 2000, while traveling in The Straight Talk Express campaign bus.

Both campaigns were generously supported by corporate money, but with Obama being the clear favorite, as his victory chances were palpably higher than McCain's.

To a higher degree than McCain, Obama's rhetoric was riddled with inconsistencies and contradictions. This is to be expected from any politician in US politics, but Obama again proved to be superior.

Both candidates accused the other of accepting funds from shady sources, including Freddie Mac and Fannie Mae, whose failures contributed largely to the US financial crisis and subsequent economic recession. The Washington Post reported in August 27, 2008 that "two members of Mr. Obama's political circle, James A. Johnson and Franklin D. Raines, are former chief executives of Fannie Mae."

Raines, who was accused of shady dealings himself, which generated him more than $50 million (according to New York Times John Steele Gordon) just before the collapse of the company was, according to the Boston Globe, put in charge of finding Obama's vice-president, the ardent pro-Israeli supporter, Joe Biden.

In fact, Obama's picks for his future administration seem, thus far, consistent with the choices he made for his campaign advisors. Early news reports already speak about an Obama team consisting of Washington's 'experts" and "old guard." An early ominous sign greeted hopeful Obama supporters just hours after he was declared a winner, when he chose Rahm Israel Emaneul as his White House Chief of Staff.

Not only is Emaneul the opposite depiction of unity, hope and change, but one must also question his true commitment to the United States. "His volunteer service in Israel during the 1990s Gulf War is no fiction, with the Jewish press hailing Emanuel's ascension as a sign that Israel will have its own man in the Obama White House," wrote Elana Schore in the British Guardian on November 6.

In fact, theories are already rife regarding the relationship between Obama's choices and the support he received from the pro-Israeli lobby in Washington during the campaign, despite his 'irksome' middle name and his unsettling 'ties' to world-renowned Palestinian intellectuals Edward Said and Rashid Khalidi.

It needs to be said, if Obama's rise to power provides any positive indications at all, it is that the popular mood has been fundamentally altered in its perceptions regarding race and gender in politics. But the elections tell more about the American voters, than those for whom they voted.

The fact that Obama is half African-American or that Biden supposedly grew up in harsh circumstances - or that Palin is a woman and McCain's airplane was shot down - should be of no essence at all insofar as their policies, decisions and leaderships are concerned. That would be determined by time and experience, although the early signs are hardly promising.

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Ramzy Baroud [send him email] is an author and editor of PalestineChronicle.com. His latest book is The Second Palestinian Intifada: A Chronicle of a People's Struggle (Pluto Press, London). Visit his website at www.ramzybaroud.net.

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Consumers Don't Cause Recessions November 17 12:05pm

There's one saving grace about Paul Krugman's column at the New York Times: when an Austrian economist wants to explain how mainstream economics leads to ruin, he can always trust Krugman to set up the target in a clear, concise manner. This saves us a lot of work, because we don't have to first build up the position before knocking it down.

Even the casual reader of the financial press knows that it is dominated by Keynesian "demand-side" thinking. For example, during the debate over the stimulus checks earlier in the year, the main objection was that taxpayers might use some of their rebate to pay down credit card bills, rather than blowing the whole thing at the mall. But the reader will never see a careful, step-by-step exposition of the worldview that generates such crazy notions.

Enter Paul Krugman. In a recent piece, "When Consumers Capitulate," the newest Nobel laureate spells out the method behind the madness. Let's take the opportunity then to show just why this focus on consumer spending is not only mistaken but downright dangerous.

"The Paradox of Thrift"

Krugman first tells us the (allegedly) bad news: "The long-feared capitulation of American consumers has arrived.[R]eal consumer spending fell at an annual rate of 3.1 percent in the third quarter; real spending on durable goods (stuff like cars and TVs) fell at an annual rate of 14 percent."

Now let's stop for a moment. Many left-leaning writers - including Krugman - have been warning for years that the US trade deficit was too high, and that the national savings rate was too low. So one would think that a drop in consumer spending would be a good thing. Ah, not so fast: Krugman tells us that "the timing of the new sobriety is deeply unfortunate..For consumers are cutting back just as the U.S. economy has fallen into a liquidity trap."

And now to the actual theory behind all these musings. Krugman writes,

[O]ne of the high points of the semester, if you're a teacher of introductory macroeconomics, comes when you explain how individual virtue can be public vice, how attempts by consumers to do the right thing by saving more can leave everyone worse off. The point is that if consumers cut their spending, and nothing else takes the place of that spending, the economy will slide into a recession, reducing everyone's income.

In fact, consumers' income may actually fall more than their spending, so that their attempt to save more backfires - a possibility known as the paradox of thrift.

My friend Bill Anderson actually derives sustenance from his