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Unbridled and unrestrained capitalism ?

Thomas DiLorenzo has an excellent smackdown of the myth that the global financial crisis (GFC) was caused by unrestrained, unregulated American capitalism.

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Laissez-faire run amok in financial markets is said to be a cause of the current crisis. But the Fed alone - a secret government organization that is accountable to no one and which has never been audited - performs hundreds of regulatory functions, in addition to recklessly manipulating the money supply. And it is just one of numerous financial regulatory agencies (the SEC, Comptroller of the Currency, Office of Thrift Supervision, FDIC, and numerous state regulators also exist). In a Fed publication entitled "The Federal Reserve System: Purposes and Functions," it is explained that "The Federal Reserve has supervisory and regulatory authority over a wide range of financial institutions and activities." That's the understatement of the century. Among the Fed's functions are the regulation of

• Bank holding companies
• State-chartered banks
• Foreign branches of member banks
• Edge and agreement corporations
• US state-licensed branches, agencies, and representative offices of foreign banks
• Nonbanking activities of foreign banks
• National banks (with the Comptroller of the Currency)
• Savings banks (with the Office of Thrift Supervision)
• Nonbank subsidiaries of bank holding companies
• Thrift holding companies
• Financial reporting
• Accounting policies of banks
• Business "continuity" in case of an economic emergency
• Consumer-protection laws
• Securities dealings of banks
• Information technology used by banks
• Foreign investments of banks
• Foreign lending by banks
• Branch banking
• Bank mergers and acquisitions
• Who may own a bank
• Capital "adequacy standards"
• Extensions of credit for the purchase of securities
• Equal-opportunity lending
• Mortgage disclosure information
• Reserve requirements
• Electronic-funds transfers
• Interbank liabilities
• Community Reinvestment Act subprime lending requirements
• All international banking operations
• Consumer leasing
• Privacy of consumer financial information
• Payments on demand deposits
• "Fair credit" reporting
• Transactions between member banks and their affiliates
• Truth in lending
• Truth in savings

That's a pretty comprehensive list, the result of 96 years of bureaucratic empire building by Fed bureaucrats. It gives the lie to the notion that there has been "too little regulation" of financial markets. Anyone who makes such an argument is either ignorant of the truth or is lying.

Why Krugman (and Keynes) are completely wrong.

Krugman, in 2002: (hat tip, Liberty Papers)

To fight this recession the Fed needs more than a snapback; it needs soaring household spending to offset moribund business investment. And to do that, as Paul McCulley of Pimco put it, Alan Greenspan needs to create a housing bubble.

Capitalism is nowhere to be found

The ALS have a post which show how socialism and welfare programs have captured most voters in our democracy through their entitlement programs.

Age Pension, Disability Support Pension, Carer Payment, Bereavement Allowance, Newstart Allowance (the “dole”), Sickness Allowance, Parenting Payment, Widow Allowance, Youth Allowance, Austudy Payment, ABSTUDY, Special Benefit, Service Pension, Partner Service Pension, War Widow’s & Orphan’s Pension, Income Support Supplement, Family Tax Benefit (A), Family Tax Benefit (B), Baby Bonus, Double Orphan Pension, Maternity Immunisation Allowance, Child Care Benefit, Child Care Tax Rebate, Rent Assistance, Pharmaceutical Allowance, Remote Area Allowance, Telephone Allowance, Utilities Allowance, Seniors Concession Allowance, Pensioner Education Supplement, Education Entry Payment, Work for the Dole supplement, Language, Literacy and Numeracy Supplement, Pension Bonus Scheme, Pension Bonus Bereavement Payment, Crisis Payment, Mobility Allowance, Carer Allowance, Carer Bonus, Seniors Bonus, Pensioner Concession Card, Low-income Health Care Card, and Commonwealth Seniors Health Card.

And some people are still on discontinued programs, including Mature Age Allowance, Partner Allowance, Widow B Pension, Wife Pension (Age), and Wife Pension (Disability Support Pension). Not to mention tax expenditures.

Pay your taxes or go to jail

Thanks to the folks at Reason, this enlightening video about income tax and just who is already paying for the burden of government largesse:

Defamation and slander by ninemsn

This article, reporting on the death of Richard Pratt, makes the following false claim:

On Monday, the Commonwealth DPP withdrew all charges because of Mr Pratt's advanced terminal cancer.

Lack of evidence.. ill health.. its all the same right ?

I hope the Pratt family get lawyered up and sue.

The road to socialism

A new government intervention for Australia - lenders can now be sued for damages if they make loans that turn sour.

The uniform national law will for the first time cover mortgages, credit cards, pay day lending and other consumer credit products.

The Australian Securities and Investment Commission will be charged with enforcing the so-called responsible lending laws.

Under the laws, defaulting borrowers will be able to sue for damages as a result of being put into loans they cannot repay.

Breaches will attract fines of up to $220,000 for individuals and $1.1 million for corporations and jail terms of up to five years.

Why is it that so few people can see the side-effects and hazards of this legislation ?

Firstly, it imposes huge new costs and risks on lenders, thus making them less likely to make all kinds of loans - good and bad.

Secondly, it runs counter to other government interventions in the banking sector. Efforts to lower interest rates, boost first home owners grants, support the property market, provide a guarantee to bank deposits have all acted to expand and maintain the supply of credit to the market (much of which has been based on some fairly bad and sub-prime type lending).

Which brings me to my view of how things are shaping.

Whilst a pure dictatorship moulds and grows government to his single purpose - his limitless power and prestige - what we are seeing is a typical socialist government.

It blindly and clumsily creates new government plans, powers and agencies to maintain power and popularity and to look like it is acting in the best interest of "the society". Yet many of these agencies often have impacts that contradict each other, and the society becomes burdened with thousands of pages of regulations that limit freedom and tie everybodys hands.

No consideration is given to the existing plans, agencies and regulations that we are saddled with. As the layers of complexity and regulation build, we begin to see what I call "the crap sandwich".

And these ill conceived plans are not free:

ASIC will be given an extra $66 million and hire 200 new full-time employees to administer the laws.

Its tough being a taxpayer these days.

Conroy you dumb bastard, come here !

You are the stupidest power-hungry tyrant to be empowered with ministerial responsibility in the history of Australian politics.

Come on.. I dare you. Watch this website. Monitor it closely. I know you want to. You might learn a thing or too.

The Federal Government will begin trawling blog sites as part of a new media monitoring strategy, with official documents singling out a website critical of the Communications Minister, Stephen Conroy

Private vs Public sector.

Public transport is a fricking disaster.

(the above sentence applies equally for public health and education)

The latest doom and gloom comes in an Age article titled..

Hard-times just the ticket for public transport.

Most socialists need only glance at the above headline and immediately begin with their usual script full of the empty talking points which are easily demolished through logic, and repeatedly refuted through evidence and facts.

Those talking points are as follows:

• Not enough funding ! The government has been and continues to deprive "the system" of sufficient resources (This talking point comes from public transport lobby groups, unions and the ABC )
  
• Poor and dumb planning. (Usually the opposition political parties and media figures recite this one)
• Unregulated free markets are to blame !! (From the ABC and the hard left)
  

Each of these arguments is vague and shallow. Not a single fan of public transport would care to tell us what sufficient funding is. Nor would they tell us what "good planning" is. And the 3rd falsheood is all too easy to trot out, by asserting that free markets exist everywhere and that no act of government played any role in creating or exacerbating the problems.

Yet ... history clearly and unambiguously reveals that each new decade brings about more and more funding for each public sector industry, more and more efforts placed into planning and regulation, and more pages of regulation and greater government ownership than before.

The exceptions are the success stories - when government privatised AND DEREGULATED industries like telecommunications, banking, transport, trade, commerce and hospitality.

The leftists cannot have their cake and eat it too. They cannot place thousands of regulations on a semi-privatised public transport sector, where only the train operator bids for the government contract to operate a monopoly, and then give their usual knee-jerk reaction of blaming free markets/privatisation when things go wrong.

Back to the story:

THE deteriorating economy is adding to Melbourne's public transport woes, with commuters boarding trains, trams and buses to save money.

A survey of 600 people by public transport marketing and information agency Metlink has found that 75 per cent of Melburnians are trying to save money because of worries over the economy. As a result, a third are looking to use public transport more to cut their budgets.

Read that paragraph. What is the actual news item being reported ?

More people are using public transport.

Why is this "bad" or "grim" news ? ?! Isn't this what the government wants us to do ? They tell us not to use our cars, they place stamp duty, registration, fuel taxes and parking restrictions everywhere, they tell us to catch more trains and do our bit for "the environment".

Could you imagine the same response for any single private industry out there ?
If more people buy televisions, or groceries, or go out to the movies, or go out to restaurants, would that particular industry complain ? No, they would be overjoyed and do their best to serve all these willing customers.

I think even the most hard-core statists, the advocates of socialised health, medicine, education and transport, realise deep-down some of the inherent problems in their huge plans to spend our money on their personal priorities for society, but fail to publicly acknowledge them.