Tag Archives: policy

Debt and Taxes

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The price of our burgeoning national debt is this.  As our debt grows, more of our national income must be taken out of our economy and spent: at minimum, on the interest payments due; if we’re to actually pay off the loans, even more on principle payments.  But as we make the payments, if we borrow still more, still more money must be taken out of our economy for the additional payments.

In essence (to beat this horse a bit), money taken out of our economy to pay our increasing debt is money not available to our economy for use in productive things: capital investment, R&D, consumption, hiring, and so on.  Our nation’s debt, in the best of times, is a drag on our economy, but when it gets out of hand, it’s worse—it generates a negative feedback loop that actually contributes to shrinking our economy.  The more money taken out to make the payments, the less money for growth; the less growth, the less capacity for absorbing the removal of money, and the more that same removal amount hurts.

It’s true enough that the Federal Reserve Bank can manipulate interest rates, so as to keep those interest payments small and less of a drag, but only to a point.  In the end, Mr. Market overrules all of us, including our government.  As our debt grows (Greece, Italy, and Spain are graciously serving as object lessons here), our ability to repay it becomes more doubtful.  It’s certainly true that the Fed also can print all the dollars it wishes to print with which make those payments.

But there’s a rub here, too.  Our dollars are only worth what they can buy, and as we print more and more of them, they can buy less and less (that’s inflation)—including the “purchases” represented by debt payments.  There will come a time, sooner rather than later, when the interest the Fed is setting on our debt no longer accurately reflects the risks inherent in our debt, both in terms of our ability finally to repay and in terms of the value received from lending to us.  Worse, it will have become impossible to determine an accurate price either of our debt or of the risk in lending to us.  At that point, who will wish to lend to us?  Ask the Greeks, Italians, and Spanish how this is working out for them.

The price of rising taxes, another leg to our government’s efforts to right our economy, is this.  Taxing, at bottom, withdraws money from our economy.  Take everything written above about debt payments subtracting from our economy’s capacity and substitute “tax collections,” and we have the same negative feedback loop.  Increasing those taxes—a need seemingly justified by our stagnating, if not fading, economy—simply exacerbates the problem, with even more money taken out, an even more constricted economy as a result, and even less revenue going to government.  And more importantly, an even less effective economy, with lower production, less investment, fewer jobs, and reduced quality of life.

There is this one additional factor.  Some of the tax revenues do find their way back into our economy, but not all.  Roughly 75-80 cents of every dollar collected in taxes is all that makes it back.  Leaving aside the fraud, waste, and abuse that is a favorite target of our politicians’ perennial “spending cut” moves, the government acts as a middle man in the transactions, and so it keeps a fraction of every tax dollar for itself for the purpose.  Additional fractions of the tax dollar are lost simply to friction.

Further, government spending is money that is significantly misallocated, if only because it’s allocated to purposes we would not have chosen had the money been left in our hands.  It’s also misallocated, though, because so much government spending is allocated to things that inherently wasteful and destructive—overregulation from EPA regulations threaten electricity-generating power plants with closure, at the costs of jobs and of increased instability of our national power grid, for instance—and misguided—subsidies for “green” energy enterprises and for oil and gas production, for instance.  These misallocations reduce the efficiency of our markets so that our economy cannot even use the reduced production effectively.

Odds and Ends from Obama’s New Nationalism Speech

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Here are some odds and ends from President Obama’s New Nationalism speech yesterday.  In my post yesterday, I looked at the parallels between Theodore Roosevelt’s Big Government intentions and Obama’s Big Government intentions.  In the present post, I’ll look at other remarks that Obama made, and what they indicate about his plans.

Let’s begin with this one.

So [Roosevelt] busted up monopolies.

This is fairly minor, but it demonstrates a lack of concern for the facts.  Roosevelt didn’t “bust up” many monopolies at all.  Mr. Trust Buster, instead, tried to bring the railroads under the control of his Executive Branch of the Federal government.  He simply didn’t believe that the courts were the proper place to handle these affairs.  Indeed, it wasn’t until 1909 that the Sherman Antitrust Act got a serious work out (beyond an 1890s effort to break up a labor union monopoly), when the DoJ brought an antitrust suit against Standard Oil.

There’s this remark, too:

After all that’s happened, after the worst economic crisis since the Great Depression, they want to return to the same practices that got us into this mess.…  Their philosophy is simple: we are better off when everyone is left to fend for themselves and play by their own rules….  I believe that this country succeeds when everyone gets a fair shot, when everyone does their fair share, and when everyone plays by the same rules.

Aside from crass partisanship, this is simply an inaccurate description of the choices.  The real choice is between those who, on the one hand, want big government to make decisions for Americans, big government to define what is fair or appropriate for Americans to do; and on the other hand, those who want government out of Americans’ lives, who trust to individual Americans’ wisdom and capacity to determine for themselves what they will do and to accept the consequences for those decisions.  And to do so under a common set of rules.  Obama’s “choice” is a straw man wholly unrelated to the discussion.

And this:

It’s heartbreaking enough that there are millions of working families in this country who are now forced to take their children to food banks for a decent meal.

And yet it’s government farm subsidies, and government price and labor controls that drive those costs to the point of Americans needing food banks, and food stamps.

And this:

Today, manufacturers and other companies are setting up shop in places with the best infrastructure to ship their products, move their workers, and communicate with the rest of the world. That’s why the over one million construction workers who lost their jobs when the housing market collapsed shouldn’t be sitting at home with nothing to do. They should be rebuilding our roads and bridges; laying down faster railroads and broadband….

They would be, if big government got out of the way of projects that would provide jobs—like the Keystone XL pipeline that would have provided 20,000 construction jobs in the US and nearly 200,000 follow-on, permanent jobs in related industries that would have profited from the outflow from the pipeline.  There are, according to some estimates, 1,000,000 jobs in the oil and gas industry alone that would materialize, were big government to get out of the way of business, to get out of the way of drilling, for instance.

Obama quotes Roosevelt extensively, including

“Our country,” [Roosevelt] said, “…means nothing unless it means the triumph of a real democracy…of an economic system under which each man shall be guaranteed the opportunity to show the best that there is in him.”

As we saw in yesterday’s post, though, that’s not all that Roosevelt said.  What Obama has so carefully elided is that other shoe that utterly negates any hope of “showing the best” [emphasis still added]:

…having those rules changed so as to work for a more substantial equality of opportunity and of reward for equally good service.

He decries some government outcomes.

Massive deficits that have made it much harder to pay for the investments that built this country and provided the basic security that helped millions of Americans reach and stay in the middle class—things like education…Medicare and Social Security.

But he ignores their source.  These are things that belong in the hands of the States and local communities, in the hands of individual, capable Americans.  Big government’s deficits exist because of massive big government spending of wealth redistributive taxes.  If these “investments” were where they belonged, big government wouldn’t need to be spending and so wouldn’t need to be taking the tax monies away from Americans in the first place.

Then he says this:

…we’ve also paid for these investments by asking everyone to do their fair share.

Would that include the 50% of Americans who pay only 3% of the nation’s income tax collections?

He goes on:

If we want a strong middle class, then our tax code must reflect our values. We have to make choices.

Today that choice is very clear. To reduce our deficit, I’ve already signed nearly $1 trillion of spending cuts into law, and proposed trillions more….

Actually, he’s “promised” $1 trillion in future spending growth reductions.  He’s actually exploded our national deficit by some $1.5 trillion and our nation’s debt by some $9 trillion in his three short years in office.

More on taxes:

Most immediately, we need to extend a payroll tax cut that’s set to expire at the end of this month.

Since he agrees that a tax cut is good for Americans, why is he so adamantly opposed to a permanent income tax cut, instead of this temporary extension of a reduction in funding for an already failing Social Security system?

and

But in the long term, we have to rethink our tax system more fundamentally. We have to ask ourselves: Do we want to make the investments we need in things like education, and research, and high-tech manufacturing? Or do we want to keep in place the tax breaks for the wealthiest Americans in our country? Because we can’t afford to do both.

This is a cynical false dichotomy, supportive only of the modern Progressives’ class warfare.  The choice is not between big government subsidies of favored industries and higher taxes on disfavored Americans.  The choice is between big, intrusive government and a smaller federal government that respects the rights and duties of the constituent States and the sovereign Americans.  The items named by Obama are items that belong in the hands of the States, local communities, and Americans and their businesses.  These are choices that we certainly can afford, given fewer big government diktats and lower taxes, leaving more money in the hands of the folks who actually know how to handle their money.

There’s this on taxes, too:

Today, thanks to loopholes and shelters, a quarter of all millionaires now pay lower tax rates than millions of middle-class households. Some billionaires have a tax rate as low as 1%. One percent.

This is the height of unfairness.

His answer is to ignore the loopholes and shelters—to refuse the closings of these offered by Republicans—and instead to seek to raise taxes on his disfavored few.  That is, indeed, the height of unfairness.

This:

Finally, a strong middle class can only exist in an economy where everyone plays by the same rules, from Wall Street to Main Street.

Would that include everyone paying the same tax rate?

He has this, too:

…already, some of these reforms are being implemented. If you’re a big bank or risky financial institution, you’ll have to write out a “living will” that details exactly how you’ll pay the bills if you fail, so that taxpayers are never again on the hook for Wall Street’s mistakes.

Except that the Dodd-Frank Bill he favors so much has provisions in it that guarantee that some entities will be taxpayer bailed-out again: the bill codifies “too big to fail.”

and

But the Republicans in the Senate refuse to let [Obama’s “consumer watchdog”] do his job. Why? Does anyone here think the problem that led to our financial crisis was too much oversight of mortgage lenders or debt collectors? Of course not.

Agreed.  Congressman Barney Frank refused to allow the regulation and oversight of entities like Fannie Mae and Freddie Mac that would have contributed to preventing the housing bubble that contributed to the current crisis.  However, that version of increased oversight would not have led to bigger government.

Finally, this:

Every day we go without a consumer watchdog in place is another day when a student, or a senior citizen, or member of our Armed Forces could be tricked into a loan they can’t afford….

Because, as Croly said, “[T]he average American individual is morally and intellectually inadequate to serious and consistent conception of his responsibilities…,” and as Obama has said all these last three years in his own messaging, Americans just don’t understand. Government has to do for us.

But in the end, despite Obama’s hubris in attempting to drape the Roosevelt’s mantel around his shoulders, he simply failed to measure up.  Where Roosevelt’s New Nationalism speech, regardless of what we might think of it, was a nonpartisan national call to arms, Obama’s New Nationalism speech simply collapsed into the petty partisanship of a harangue against those terrible Republicans who declined to accede to his every wish.

Obama, Roosevelt, and New Nationalism

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As we look at President Obama’s New Nationalism speech, delivered today at Osawatomie, KS, while cloaking himself in Theodore Roosevelt’s mantle, it’s useful to review Roosevelt’s own New Nationalism speech, which was so seminal for the Progressive movement.  I’ll skip over the boilerplate rah-rah that both speeches have and stay with some highlights.

By way of background, this is what Roosevelt and Herb Croly, one of the most articulate Progressives, had to say, presaging Roosevelt’s 1910 speech.

In his 1904 address to Congress, Roosevelt said:

The Government must in increasing degree supervise and regulate the workings of the railways engaged in interstate commerce…

In his 1908 address to Congress, just two years before his New Nationalism speech, he repeated the theme:

The proposal to make the National Government supreme over, and therefore to give it complete control over, the railroads and other instruments of interstate commerce is merely a proposal to carry out to the letter one of the prime purposes, if not the prime purpose, for which the Constitution was founded.

Here is what Croly had to say about government and Americans’ role in it in 1909.

To be sure, any increase in centralized power and responsibility, expedient or inexpedient, is injurious to certain aspects of traditional American democracy.  But the fault in that case lies with the democratic tradition; and the erroneous and misleading tradition must yield before the march of constructive national democracy….  [T]he average American individual is morally and intellectually inadequate to serious and consistent conception of his responsibilities as a democrat.

One connection between this from Croly, and Roosevelt (and by extension, Obama) is that Roosevelt’s “New Nationalism” phrase was borrowed directly from Croly’s The Promise of American Life, the source of the quote above, and from Croly’s own adulation of Roosevelt as the proper sort of democrat:

The new Federalism or rather new Nationalism is not in any way inimical to democracy.  On the contrary, not only does Mr. Roosevelt believe himself to be an unimpeachable democrat in theory, but he has given his fellow-countrymen a useful example of the way in which a college-bred and a well-to-do man can become by somewhat forcible means a good practical democrat. The whole tendency of his programme is to give a democratic meaning and purpose….

Roosevelt then opened his New Nationalism speech with all the right words.

Our country—this great Republic—means nothing unless it means the triumph of a real democracy, the triumph of popular government, and, in the long run, of an economic system under which each man shall be guaranteed the opportunity to show the best that there is in him.

But then he threw it all into a cocked hat.  He spent the next several years trying to utterly remake our economy and to place the Federal government firmly in charge of it and of the decisions that the economic players—free Americans—were supposed to be making for themselves.  And he spent the rest of his speech trying, at once, to disguise the coming effort and to justify it.  For instance [emphasis added]:

I stand for the square deal. But when I say that I am for the square deal, I mean not merely that I stand for fair play under the present rules of the game, but that I stand for having those rules changed so as to work for a more substantial equality of opportunity and of reward for equally good service.

Thus, government, not Americans, must decide the basis of “equality.”  It’s not possible, though, to have equal opportunity and equal outcomes.  Mandating equality of results necessarily deprives each man equality of opportunity because it deprives each man his right to achieve his own fullest potential.

Further:

It has become entirely clear that we must have government supervision of the capitalization, not only of public-service corporations, including, particularly, railways, but of all corporations doing an interstate business.

and

We have come to recognize that franchises should never be granted except for a limited time, and never without proper provision for compensation to the public. It is my personal belief that the same kind and degree of control and supervision which should be exercised over public-service corporations should be extended also to combinations which control necessaries of life, such as meat, oil, or coal, or which deal in them on an important scale.

and

The effort at prohibiting all combination has substantially failed. The way out lies, not in attempting to prevent such combinations, but in completely controlling them in the interest of the public welfare.

These constitute Roosevelt’s demand for big government determining what Americans might do with their market decisions and their businesses.

Roosevelt continues:

We grudge no man a fortune in civil life if it is honorably obtained and well used. It is not even enough that it should have been gained without doing damage to the community. We should permit it to be gained only so long as the gaining represents benefit to the community. This, I know, implies a policy of a far more active governmental interference with social and economic conditions in this country than we have yet had, but I think we have got to face the fact that such an increase in governmental control is now necessary.  …every man holds his property subject to the general right of the community to regulate its use to whatever degree the public welfare may require it.

Thus, Roosevelt insists that big government must be the final arbiter of what Americans might do with their own property and wealth.

and

Let us admit also the right to regulate the terms and conditions of labor, which is the chief element of wealth, directly in the interest of the common good.

Roosevelt’s big government even demands the final say over what Americans might do with their most fundamental property—their own bodies and minds.  Because, repeating Croly:

[T]he average American individual is morally and intellectually inadequate to serious and consistent conception of his responsibilities….

So it is, and has been, with President Obama. Here is what Obama said on the site of that seminal Progressive speech.  He, too, opened with the right phrases:

[His grandparents] believed in an America where hard work paid off, responsibility was rewarded, and anyone could make it if they tried — no matter who you were, where you came from, or how you started out.

These values gave rise to the largest middle class and the strongest economy the world has ever known.

Then, like Roosevelt before him on this spot, he threw it all into a cocked hat.  Like Roosevelt, Obama has spent these last three years trying to utterly remake our economy and to place the Federal government firmly in charge of it and of the decisions that the economic players—free Americans—are supposed to be making for ourselves.  Like Roosevelt, he spent the rest of his speech trying, at once, to disguise the effort and to justify it.

We all know the story by now: Mortgages sold to people who couldn’t afford them, or sometimes even understand them…. Regulators who were supposed to warn us about the dangers of all this, but looked the other way or didn’t have the authority to look at all.

So we need more regulators and more regulations.  And folks should bear no responsibility of their own for buying mortgages they couldn’t afford or understand.  Big government will take care of them.

and

…a crisis from which we are still fighting to recover. It claimed the jobs, homes, and the basic security of millions—innocent, hard-working Americans who had met their responsibilities, but were still left holding the bag.

Never mind that that basic security had already been nationalized by big government in the form of wealth redistributive taxes to pay for a national social security system that was on the verge of bankruptcy before the present crisis, a national health care system that was on the verge of bankruptcy before the present crisis, a big government that already was increasingly deep into debt and in these last three years three times deeper.  Yes, innocent, hard-working Americans are, indeed, left holding the bag.

and

At the turn of the last century…we had to decide: would we settle for a country where most of the new railroads and factories were controlled by a few giant monopolies….

Theodore Roosevelt disagreed.

Indeed, he did.  As we saw above, Roosevelt believed that big government should be the monopolist.  Because big government knows better.  Because Progressives Know Better.

Additionally:

Remember that in those years…we had weak regulation and little oversight….

Aside from the misstatement of the facts, this is just a Rooseveltian plea for even bigger government.  For example:

We need to up our game. And we need to remember that we can only do that together.

It starts by making education a national mission—government and businesses….

and

We should be giving people the chance to get new skills and training at community colleges, so they can learn to make wind turbines and semiconductors and high-powered batteries.

and

And by the way—if we don’t have an economy built on bubbles and financial speculation, our best and brightest won’t all gravitate towards careers in banking and finance.

and

But as a nation, we have always come together, through our government, to help create the conditions….

and

…last year we put in place new rules of the road that refocus the financial sector

and

There are also limits on the size of banks and new abilities for regulators to dismantle a firm that goes under. The new law bans banks from making risky bets with their customers’ deposits, and takes away big bonuses and paydays from failed CEOs, while giving shareholders a say on executive salaries.

and

For the first time in history, the reform we passed puts in place a consumer watchdog who is charged with protecting everyday Americans from being taken advantage of by mortgage lenders, payday lenders or debt collectors.

and

Too often, we’ve seen Wall Street firms violating major anti-fraud laws because the penalties are too weak and there’s no price for being a repeat offender. No more. I’ll be calling for legislation that makes these penalties count—so that firms don’t see punishment for breaking the law as just the price of doing business.

The push for more government involvement, bigger government is breathtaking in its scope.  The Progressive government of Obama must be the final arbiter of what Americans and our businesses will be allowed to do.  Obama’s Progressive government looks for the elimination of the judiciary from its role (vis., bankruptcy court) in favor of Executive Branch fiat—just as Roosevelt before him.   Obama’s Progressive government demands a “watchdog” that is not at all accountable to Americans, or to our representatives in the Federal government, our Congress; a “watchdog” that’s accountable only to itself and to the President.

Obama’s Progressive government isn’t interested in enforcing existing law and having existing regulators do their jobs, as Judge Jed Rakoff has forcefully suggested.  This would not expand government.

The parallels are plain.  Roosevelt wanted to control the railroad industry from his Executive office, pre-empting the Judiciary, and to tell the other industries what they might do.  Obama wants to control the financial and health services industries from his Executive office, pre-empting the Judiciary, and to tell the other industries what they might do.

Both men demand(ed) the following.  Government, rather than Americans, must decide what is “fair.”  Government, rather than Americans, must decide what market decisions Americans will make.  Government, rather than Americans, must decide how Americans’ wealth must be (re)distributed.

Will HARP 2.0 Accomplish Anything?

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The administration has come out with an updated Home Affordable Refinance Program, what The Wall Street Journal‘s  Smart Money calls HARP 2.0.  With this improvement, underwater homeowners can refinance their mortgages at a lower rate if they have Freddie Mac- or Fannie Mae-backed mortgages, they’re current on their existing mortgages, and they’ve not missed a mortgage payment in the last six months and not more than one payment in the last twelve.

There are a number of items to consider, though.  Why would anyone want to take the lender’s side of such a (refinanced) loan?  The collateral offered has less value than the collateral that was offered for the original loan: it’s the same house, now devalued, often very significantly.  This means that a lender that retains the loan in its portfolio is giving up one income stream for a smaller income stream on a lower-valued home. This decrement often can be worth it, given the reduced loan to collateral value ratio associated with an increase in home value, but in this market…?  Additionally, the lender that sells the loan to a packager or another loan servicer is going to get a smaller sales price for the refinanced loan, since both the collateral and the income stream are smaller.

On the other side of such loans, the borrowers still will be underwater.  To be sure, this isn’t a problem for lenders whose borrowers in good standing or for borrowers who aren’t trying to sell, but is a problem for borrowers looking to relocate—to a different job in a different city, or to a job at all in a different city.  But these borrowers aren’t trying to refinance.

There are mechanical problems with HARP 2.0, also.  Even though the Luddites who underwrite loans manually can begin using the program now, the government’s IT whiz kids won’t have the software in place to support the new rules until early February for Freddie Mac-backed mortgages or March for Fannie Mae-backed mortgages.  This shouldn’t be surprising, though: this performance is of a kind with the government’s IT performance with the IRS’ “upgrade” of their computer systems and of OPM’s government jobs Web site.  Still, I remain amazed that, given as long as the government has known about this HARP variation, the software requirements weren’t able to be satisfied already, much less won’t be for another three+ months.

But beyond the bureaucrats’ lack of thought about how much this this program actually is going to accomplish, the lack of consideration for consequences or for history is…apparent.  Consider what the government holds out as selling points for this update:

  • borrowers who apply to the same lender to whom they make their monthly payments won’t have their credit scores checked, and
  • borrowers won’t be required to provide documentation proving their income.

This just repeats the mistakes that contributed to the housing bubble and burst in the first place:

Hmm….

Government Controls: A European Example

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I’ve been posting about the European debacle for some time; here’s another.  I stay on this subject because there are lessons here for us, lessons that are especially urgent given that our political class sees Europe as a valuable model for governance.

Here are the current moves, just completed or in progress.  Six central banks have gotten together to make acquisition of dollars for Europe, paid for with euros, a whole lot easier.  This move just buys some time, maybe, but it doesn’t address the underlying problem of too much government spending and too much unserviceable sovereign debt.  And it ignores the risks to us should sovereign default in the euro zone become widespread.

The move in progress is an attempt to more tightly integrate the euro zone nations’ budgets—to put them more under the control of the EU central “government” in Brussels, and less under the control of the sovereign nations responsible for them.  Indeed, as proposed by French President Nicolas Sarkozy, this is a three-part move: morphing the Treaty of Maastricht (which created the EU and the euro) into a new treaty incorporating greatly increased budget discipline imposed from Brussels; creating a European Monetary Fund, nominally to support “countries in difficulty;” and euro zone moves made by majority vote rather than requiring unanimity.

The arguments made for tighter integration, singling out Sarkozy (he’s by no means the only one making these arguments; he’s just the loudest and most articulate) include the following.  “All economies became totally under the mechanism of finance, the speculative logic. We’ve seen how it’s affected industry. Also how it’s degraded the value of work.”  And “There can be no common currency without economic convergence without which the euro will be too strong for some, too weak for others, and the euro zone will break up.”

Taking the three steps to tighter integration in turn, here are some problems.  The various sovereign governments [sic] have, with their central planning to their varying degrees, already been over-managing their national economies, and the result is too much spending and too much borrowing, and so we have the present economic strait.  It’s illogical to expect that even more centralized control will improve on the track record—correcting the failure of central control by increasing the degree of central control makes no sense.

Second, a European Monetary Fund “support” facility will only be used to bail out those nations that find themselves in economic trouble.  Nations will have no incentive to apply discipline, or to do more than pay lip service to budgetary diktats from Brussels.  Knowing—or merely believing—that a bailout will be in the offing completely undoes any hope of greater national responsibility.  Feeding this is the fact that now the nations involved can blame their troubles on Brussels’ requirements and so demand that Brussels fix them.  Through the EMF.

Third, the majority vote capacity just means that the profligate many can demand that the responsible—and so sound—few make up the shortfalls of the many’s failures.  This means that Germany will reduced to the euro zone’s piggy bank.  Some argue, though, that this is only just.  It’s what reparations are for.

But at bottom, the argument for tighter integration—no matter the mechanism—ignores some fundamental problems that must be solved before the euro zone’s sovereign debt problems (note that: the problems are those of the individual sovereign nations, not of the euro zone as a whole) can be solved.  For instance, to take a narrow case for illustration, “the mechanism of finance” is not what has cheapened labor.  Things like 35-hour work weeks; labor laws that functionally guarantee a job for life, regardless of the performance of the employee; and retirement in middle age have done that.

But more importantly, tighter integration is doomed to fail when the polities involved don’t agree on the relationship between citizen and government, the role of government, or the purpose of money.  It is this too-great heterogeneity of social philosophy that drives the single euro to be too strong for some and too weak for others.

The parallels with our own situation are apparent.  We have an increasingly intrusive central government that seeks to increase its control over our own economy in order to correct the failures of its prior controls.  We have an increasingly profligate central government that spends too much by ever-increasing margins, and so that borrows ever increasing amounts.  We have a central government that insists on bailing out every one and every thing, thereby attempting to ban failure from our own market place.  And the Fed has been turned into the national piggy bank.

The answer for us, as it is for the EU, is less central control and greatly shrunk governments and reduced government roles.  And greater respect for the intelligence and the wisdom of the sovereign citizens, and so greater trust in us to take care of ourselves and of our neighbors without government diktats, without government taking our property to redistribute to others, without government “protecting” us from ourselves and the consequences of our actions—which “protection” also protects us from the consequences of our successes.