Friday, April 29, 2011

Why (Some) People Like Taxes

The True Nature of Taxation

Nobody really likes paying their taxes. But, as the old adage about “death and taxes” conveys, there is a sense that taxes are as legitimate and as inevitable as death itself. In their acceptance of taxation, many well-meaning people forget that taxation violates our most basic moral principles.

If you have ever been to a kindergarten or a playground where very young children play, you might have realized that, although the kids are too young to understand many things, they already have a surprising sense of justice.

Take a toy away from a toddler who cannot yet speak a word, and you will often be met with a very clear protest. As far as the toddler is concerned, you have stolen her toy, you have initiated violence, and therefore it’s time to cry. The toddler’s reasoning probably isn’t this sophisticated, but the understanding is there.

Slightly older children are even more amazing. They understand that there is illegitimate violence (when a toy gets stolen), but they also understand that there is such a thing as legitimate violence as well, which is when the victimized child goes to the thieving child and takes her toy back. The astonishing thing is that the usual focus is on getting the toy back rather than punishing the aggressor. Punishment is a concept that they learn later, probably from us.

The initiation of violence is the act of an aggressor against you or against your property. This can be done through actual violence or through intimidation, because the mere threat of violence is an act of violence in itself. A good example would be a thief that points a gun at you to get your wallet without actually pulling the trigger. Another less obvious example is the way the government takes our money. To say that taxes are a form of theft may seem a bit over the top, but refuse to pay your taxes and you will be thrown in jail. Refuse to pay your property taxes and you will see who really owns your house.

Governments have done a wonderful PR job: They call us taxpayers, not victims, and the taxes are somehow “collected,” not stolen. Taxes are also called contributions, as if it had been a matter of choice. And because it is the government that decides whether this form of theft is legal or not, there is nothing we can do legally to get restitution. No playground justice for us.

Many actually see the crime but take it as a necessary evil, and when you ask for the complete abolition of taxation, they ask in minute detail how we would pay for roads or law enforcement.

I admit, it is hard to imagine how our society would work in a completely new order, but I would like to offer some ideas and historical facts that may ease these worries.
One important thing to remember is that all of the services now funded by taxation and provided by the government were at one point in the not-so-distant past funded and provided privately. Indeed, many are being provided privately today, from affordable private education in Ghana to the luxurious streets being built every day in our North American cities for new residential developments (which are later handed off to local governments).

Another reassuring example for those who want answers right now regarding a future without taxation is that not so long ago slavery was normal, and in many parts of the world nobody could have conceived of life without it. When some pointed out the ethical and economic problems behind the practice, the vast majority of people claimed that, not only was it impossible to abolish slavery, but even the slaves themselves were actually better off in captivity than in liberty. Today these claims seem ludicrous to us.

Some were genuinely concerned about the slaves. Because they had no property, some said they would all be homeless and scattered around. Such well-meaning conservatives even feared that without their masters the slaves would be unemployed. And above all, the worriers claimed that the entire economy would collapse, putting everyone — former slaves included — in a state of abject poverty.

The idea of a world without taxes is hard for us to imagine, and there are many unanswerable questions that we would like answered. But we need to stand for liberty regardless of our reservations, just like we still stand against slavery.

While I agree that lots of neat things can be done with stolen money, we need to remember that we would never go to our neighbors with a gun and tell them to pay for our education or retirement, regardless of how rich they were. We wouldn’t do it because it’s wrong. Even a toddler knows that.

Obama Can't Even Fake a Document.........The Bozo

Release of dubious document only serves to unleash firestorm of new questions
Obama Birth Certificate Number Proves Forgery? 280411top1
Paul Joseph Watson
Thursday, April 28, 2011
Despite the establishment media declaring “case closed” on the birther issue, the release of what purports to be Barack Obama’s long form birth certificate has only caused a firestorm of new suspicion amongst Americans, with the document only serving to confirm unexplained anomalies, such as why Obama’s birth certificate number is higher than that of people born after him at the same hospital.
If early reaction is anything to go by, the deluge of editorials in outlets like the Washington Post and the New York Times claiming the birther movement is dead are completely off the mark. A poll taken by the Colorado Springs Gazette shows that 55% believe the birth certificate is “probably forged” with only 31% believing it to be genuine.
Obama Birth Certificate Number Proves Forgery? 280411top2
As we have illustrated, when subjected to in-depth analysis, there are so many inconsistencies within the document itself that it’s almost as if the White House wanted to get caught releasing a dud – it’s that bad.
“When sections of the document are enlarged significantly, we discover glaring inconsistencies. For instance, it appears the date stamped on the document has been altered. Moreover, the document contains text, numbers, and lines with suspicious white borders indicating these items were pasted from the original scan and dropped over a background image of green paper,” writes Kurt Nimmo.
But it’s not only the forensic aspects of the birth certificate that don’t stand up to scrutiny, the details contained on the form only serve to confirm inconsistencies first highlighted by the “receipt” of birth form that Obama released in 2008.
Leading “birther” Jerome Corsi has highlighted one anomaly in particular that the new birth certificate does nothing to dismiss. Corsi writes that the issue represents the, “Rosetta Stone of deciphering both Obama’s previously released short-form Certification of Live Birth and the newly released purported copy of his long-form birth certificate.”
It centers around the fact that two twins born in the same Kapi’olani hospital listed on the Obama document the day after Obama was purportedly born actually have birth certificate numbers lower than Obama. The number should be lower on the Obama certificate if he was born before the twins.
As Corsi explains, “Susan Nordyke, the first twin, was born at 2:12 p.m. Hawaii time Aug. 5, 1961, and was given certificate No. 151 – 61 – 10637, which was filed with the Hawaii registrar Aug. 11, 1961.
“Gretchen Nordyke, the second twin, was born at 2:17 p.m. Hawaii time Aug. 5, 1961, and was given certificate No. 151 – 61 – 10638, which was also filed with the Hawaii registrar Aug. 11, 1961.”
“Yet, according to the Certification of Live Birth displayed by during the 2008 presidential campaign – and now according to the long-form birth certificate the White House released today – Barack Obama was given a higher certificate number than the Nordykes.”
“Note, Obama was given certificate No. 151 – 1961 – 10641, even though he was born Aug. 4, 1961, the day before the Nordyke twins, and his birth was registered with the Hawaii Department of Health registrar three days earlier, Aug. 8, 1961.”
The Nordyke twins’ birth certificates appear below.
Obama Birth Certificate Number Proves Forgery? 041111nordyke1
The birth certificate numbers were not assigned by the hospital, they were the responsibility of the Hawaii Department of Health at the main office in Honolulu, which stamped them with an automatic stamp that increased in number by one each time it was used, rendering obsolete the theory that the Nordyke twins had earlier numbers because their mother entered the hospital before Obama’s mother, Ann Dunham.
Why does Obama have a higher birth certificate number than the Nordykes when he was born before them and his birth was allegedly registered with the Hawaii Department of Health registrar three days before the twins?
Does this indicate that the birth certificate number on the Obama document is fake? If so, someone born in Hawaii at the Kapi’olani hospital in August 1961 has a birth certificate with the same number as the alleged Obama birth certificate, which would demolish the notion that Obama was born in the U.S. completely.
Did the people behind the forgery deliberately choose the number on Obama’s form – 10641 – because the real person born with that number is now dead and unable to contradict the anomaly?
Again, this brings back into focus the alarming concept that if the document is a fake, it’s a really terrible ham-fisted effort that will only serve to make the spectacle rumble on well into the campaign season. It forces us to ask whether the Obama administration is deliberately fanning the flames of the controversy so that Donald Trump – a massive donor to the Democratic Party – can be used as a spoiler to ensure an Obama victory in 2012.
As CBS News reports, “Billionaire Donald J. Trump, an early presidential favorite among tea party activists, has a highly unusual history of political contributions for a prospective Republican candidate: He has given most of his money to the other side.”
If Trump ends up running as a third party candidate, either on a Libertarian or “Tea Party” ticket, he could siphon away enough votes from a Republican to help Obama secure a second term in the White House. Otherwise, he could just be denigrated as a birther buffoon by the establishment media and used as a weapon through which to discredit Republicans, including Congressman Ron Paul, who as has been documented, is the only GOP candidate that stands a good chance of defeating Obama.
There are so many questions swirling around the birther controversy that Obama’s decision yesterday to publicly wade into the issue for the first time can only mean that the White House has embarked on a deliberate political ploy to embrace the topic and use it towards its own ends.


Big Fed, No Money......................

Even the Federal Reserve is Broke

April 22, 2011
How bad is the situation in America today?
Very bad.  Not like Animal House bad and the dean has kicked the frat boys off campus, more like Titanic and the boat hit the iceberg and everybody dies except the elite in their comfy lifeboats.
Whether we are talking about the continual erosion of personal freedom in too many ways to name, or radiation, toxic dispersants, droughts, crop failures, wild fires, wars, rumors of wars, oil prices, food prices, maybe nothing is as telling about the dire straits the nation is currently in than the following quote from John Hussman:
As a side note, it’s probably worth noting that the Federal Reserve has already pushed its balance sheet to a point where it is leveraged 50-to-1 against its capital ($2.65 trillion / $52.6 billion in capital as reported the Fed’s consolidated balance sheet ). This is a greater leverage ratio than Bear Stearns or Fannie Mae, with similar interest rate risk but less default risk. The Fed holds roughly $1.3 trillion in Treasury debt, $937 billion in mortgage securities by Fannie and Freddie, $132 billion of direct obligations of Fannie, Freddie and the FHLB, and nearly $80 billion in TIPS and T-bills. The maturity distribution of these assets works out to an average duration of about 6 years, which implies that the Fed would lose roughly 6% in value for every 100 basis points higher in long-term interest rates. Given that the Fed only holds 2% in capital against these assets, a 35-basis point increase in long-term yields would effectively wipe out the Fed’s capital.
Still, the Fed also earns an interest spread between its assets and its liabilities, providing about 3% annually (as a percentage of assets) in excess interest to eat through, which would allow a further 50 basis point rise in interest rates over a 12-month period without wiping out that additional cushion. In that case, the interest paid on the Federal debt held by the Fed would be used to cover the Fed’s losses, rather than being remitted back to the Treasury. In any event, it is clear that if the Federal Reserve was an ordinary bank, regulators would quickly shut it down.
However, can we really believe the Federal Reserve’s balance sheet is only $2.65 trillion when they have never been audited?  When you actually consider the liabilities being guaranteed by the Federal Reserve actually total somewhere in the neighborhood of $24 trillion, is the self-reporting of a Fed balance unequivocal truth, or are we looking at more of the “smartest guys in the room”  and their Enron accounting?  Nobody can be sure, and that is inherently why we have a financial crisis in the first place, lack of accurate price information set by market forces.  The fact that there is so much debt, so many exotic CDOs of questionable value, even after ending mark-to-market, the problem is truly one of the Feds price distorting powers on literally everything you own and consume.
Yes John, regulators would shut down the bank and if the American people actually understood the monetary system or were shown an independent audit, they would demand the bank be shut down.
Well, maybe I am being too optimistic.  It was recently uncovered that yes indeed, as long suspected, the American taxpayer footed the bill for Fed bailouts around the globe, yet there were no protests in the streets demanding arrests or people to step down for weeks and weeks like we have seen in the Arab world.  There were no politicians (except maybe Ron Paul and Bernie Sanders constant drum beat) calling for a closing of the Fed and the returning of their “assets” to the People where they belong.  No, Americans did nothing, and Americans largely do nothing in the face of criminal actions by their ruling oligarchs.  The power has been effectively removed from the people through a continual parade of fear, intimidation, misinformation and downright propaganda, sorry, now called “public relations.”
Many people do not realize that the Fed recently granted itself more discretionary, emergency powers so to speak by amending its 35% pressure holding limit.  In English this means the Fed will allow itself to participate in Treasury auctions at a rate more than 35%.  Additionally, the Federal Reserve has found a loophole to transfer all of its losses to the U.S. Treasury. i.e. you (that is if you are in the 50% of the country that actually pays an income tax).  Beyond the sheer immorality of this clandestine theft (need I say yet again), this is extremely dangerous.  The tenuous confidence holding together this whole phony monetary and fiscal system disintegrates a little more each day with each sign of price inflation and general instability and uncertainty.
The Fed and the Treasury are most certainly in a negative feedback loop inside of a liquidity trap with absolutely no way out.   For every bond bought is a further signal of the undesirability of U.S. debt.  With every debt auction grows the necessity of rapid interest rate increases as inflation can no longer be hidden in smaller packages.  With rate increases comes higher debt servicing on a debt that we already have to issue debt to service in the first place.  This is what Tim Geithner meant when he said it would be catastrophic not to increase the debt limit.  Of course when interest rates rise, there goes the pretense of recovery (sic).
It has become chaos theory with no way to predict all the possible unintended consequences.   One thing is certain however, at some point even societies and governments that make good decisions decline and fade.  Societies and governments that behave as America has, well they implode and destroy themselves or try and destroy other nations as a way out.  Potentially the only thing that makes America “exceptional” (but not to the point of avoiding calamity) is we have nuclear weapons and spend 42.8% of global defense spending.  Something tells me we are either going to go to war (again) or the world will end the Federal Reserve Note as the reserve currency and “bail out” the American society for pennies on the dollar with the Bancor or some other globalist pipe dream.

Thursday, April 28, 2011

Wait, There Was An Earth Day?

Today Is Earth Day: What About a Capitalism Day?

From an Investor's Business Daily editorial on Earth Day in 2009, featured on Carpe Diem here (the IBD link no longer works):

"Of the estimated 1 billion people who will observe Earth Day worldwide this year, few will know about the progress that has been made. Fewer still will know how it was made. The media, uninterested in looking at the real story, will simply credit the environmental movement for the improvements.

Buried beneath all the badgering and fear-mongering about lavish Western lifestyles is a reality that the stuck-on-green left won't talk about and the average American isn't aware of: The world, especially in developed nations, is a cleaner — and greener — place than it was when the environmental movement began (the chart above shows the positive trends in air quality since 1980, data).

Topping the agenda of today's environmentalist groups is the pulling down of market economies, the raising up of central planning for egalitarian goals, forced lifestyle changes and the vilification — in hopes of the elimination — of signs of wealth.

None of these advance the planet's environmental health. But capitalism has. Through wealth generated by the free market, we have enough resources to move beyond the subsistence economies that damage the environment, enough disposable income to fund clean-up programs, enough wealth to scrub and polish industry.

Only in advanced economies can the technology needed to recycle hazardous waste or to replace dirty coal-fired power plants with cleaner gas or nuclear plants be developed. That technology cannot be produced in centrally planned economies where the profit motive is squelched and lives are marshalled by the state.

There's nothing wrong with setting aside a day to honor the Earth. In fairness, though, it should be complemented by Capitalism Day. It's important that the world be reminded of what has driven the environmental improvements since Earth Day began in 1970."

Nicely Said...................

"I prefer dangerous freedom to peaceful slavery." - Thomas Jefferson

The Big Economist Fight! Worth A Watch!

Definitely worth watching again.

The Brilliance of That Hayek vs. Keynes Rap - Jeffrey A. Tucker - Mises Institute: "The debate between J.M. Keynes and F.A. Hayek, both living and teaching in Britain in the 1930s, was one of the great debates of the century. Sadly, the charming globetrotter Keynes had the podium and the audience, to the point of influencing policy the world over even to the present day. Meanwhile, the quiet and studious Hayek never really did gain an audience. Like his colleague and mentor Mises, Hayek wrote in scholarly journals and was heard only by those with skeptical minds, people who doubted the theoretical and policy conventions and looked beneath the surface."

Big Economist Fight Funny!

Watch it, enjoy, share it with friends, watch again, then read more Hayek.

We Need To Starve The Beast Regardless................

Does Government Spending Create Value?

The most common view about the national debt is this: “We are $14 trillion in debt, which is so big that we probably need to save money by spending less on some of our federal programs, and doing without the benefits they provide.” The implication in this statement is that we have two desirable goals competing for our favor. First, we want to get out of debt, or at least stop it from increasing. Second, we have helpful federal programs that should continue.
The first statement is true–we need to reduce our debt to maintain our national integrity. But the second statement is often false–many of our most expensive federal programs actually do harm. For example, federal aid to education pours billions of dollars into schools (and school bureaucracies) every year, but test scores have gone steadily downward for four decades. The years when federal aid first increased sharply, 1964-70, were the very years that SAT scores for high school students first began their steady decline. My Hillsdale colleague, economist Gary Wolfram, estimates that more than 40% of the adults in Detroit are functionally illiterate. Yet they have had a torrent of federal dollars pumped into their city and into their schools.
A second example is welfare. By increasing Aid to Families with Dependent Children (AFDC) in the 1960s, we provided more federal money, Medicaid, and rent subsidies to single mothers. Granted, single mothers have a tough job, and they often deserve our help. But the federal aid gave some of them incentives to have more children and not to get married (because they would lose the aid). Children born to unwed mothers increased from one in twenty in 1960 to one in four by 2000. Federal money seems to have increased that problem.
The solution is not to shun schools or unwed mothers. The solution is to strengthen the tie between the giver and the receiver. When a family or a church helps single mothers, both groups gain. The mother knows someone cares, and the church members take delight in improving society. When a teacher is paid mostly by students, or the parents of students, rather than by government, the teacher knows he or she must deliver a useful product or payments will not continue.
Cutting much of the federal budget may help our country, regardless of whether or not the national debt is reduced.

Dwight May Not Have Truly Gotten It....

Could You Do Better Than Eisenhower?

After World War II, Dwight Eisenhower had a meeting with his Russian counterpart Georgy Zhukov, who commanded the Soviet Army. According to Eisenhower, “One evening we had a three-hour conversation. We tried, each to explain to the other just what our systems meant, our two systems meant, to the individual, and I was very hard put to it when he insisted that their system appealed to the idealistic, and we completely to the materialistic. And I had a very tough time trying to defend our position, because he said, ‘You tell a person he can do as he pleases, he can act as he pleases, he can do anything. Everything that is selfish in man you appeal to.’”
For three hours, General Eisenhower, a future president, struggled to defend a free society and its system of voluntary exchange. Could you have done better than he did?
The main problem is that Zhukov’s system has never worked in practice. You can’t redistribute wealth and achieve actual equality. The rich have no incentive to work if their gains are forceably taken by the state; and the poor also have no incentive to work if they are given food and shelter without working for it. So production is almost non-existent. During the 1920s and the 1930s, the Russians forceably took grain from literally millions of peasants and allowed them to starve to death to support their system of redistribution.
Russian leaders at the top of Soviet society enjoyed many privileges, simply because they were willing to do the bidding of their communist dictator, Joseph Stalin. The poor in the Soviet Union stayed poor, unless they could scratch their way to the top of the government bureaucracy. The overall standard of living for the Russian people remained remarkably low. For example, before World War II, many peasants in their rural areas hadn’t used such basics as soap for many years. Such poverty was exposed after the war when refugees described their former lives to news correspondents and historians.
Another point is that in a free society you succeed not by being “selfish” and “materialistic,” as Zhukov suggested, but by satisfying wants. Henry Ford may or may not have been selfish, but he succeeded because he provided a cheap assembly-line car that millions of people wanted to put in their garages. As he worked on his first car, Ford had almost no education and only a menial job, but he had the vision to meet a need for quick transportation; he only became wealthy after he met that need.
Eisenhower stumbled for three hours to defend a free society. Our own free society will not long endure unless we have Americans who have the ability to defend it and the desire to promote it.

Nicely Said.......................

"When we are no longer able to change a situation - we are challenged to change ourselves." - Viktor Frankl

Book Review: Nullification: How to Resist Federal Tyranny in the 21st Century

Nullification: How to Resist Federal Tyranny in the 21st Century by Thomas Woods.

The central idea is to look at how Thomas Jefferson and his peers viewed the Principal-Agent relationship between the states and the federal government. And see how nullification was and could be used to reign-in tyranny at the federal level.

I'm a big fan of Tom Woods and his books, and very sympathetic to the idea of nullification. I wasn't expecting a page-turner or Grisham novel given the subject matter, but I found the book a little academic and not particularly exciting.

Don't get me wrong, the book is well-researched, logical, and full of facts. I also recommend his other recent books: Meltdown, 33 Questions about American History You're Not Supposed to Ask, Who Killed the Constitution?, and The Politically Incorrect Guide to American History. (in fact, all are STRONGLY recommended)

Some quick items from Nullification:
1. This book and the concept of nullification are NOT defenses of slavery.
2. Should the federal govt. be allowed to act as its own throttle?
3. The exchange w/ Nancy Pelosi on page 1 must be seen to be believed. I remember when it happened. p. 1
I would rather be exposed to the inconveniences attending too much liberty than to those attending too small a degree of it.
-- Thomas Jefferson
4. Nullification as a shield between people of the states and federal tyranny. The federal govt. does not have a monopoly on constitutional interpretation. p. 3
5. Supreme Court as part of the problem. Fox guards henhouse. p. 7
6. The massive dilution of representation in Congress. p. 17
The powers delegated by the proposed Constitution to the federal government are few and defined. Those which are to remain in the State governments are numerous and indefinite.
-- James Madison
7. Where have the most outrages against humans and human dignity occurred? In decentralized polities or centralized governments? p. 18
8. General Welfare, Commerce, Necessary and Proper. pp. 22 - 31
9. The central statement of the principles behind nullification. The Principal-Agent relationship. pp. 47-48
In questions of power...let no more be heard of confidence in man, but bind him down from mischief by the chains of the Constitution.
--Thomas Jefferson
10. The seeds of the "Civil War" ... the South's case against protective tariffs. pp. 74-75
11. The explanation (and a rather clear and cogent one) of why defending states' rights is not a defense of slavery. p. 75 (also see this video)
12. Threats of force against one's own people, viewed from both domestic and foreign perspectives. pp. 77-78

13. United States of America: "are," not "is"
14. Did the Civil War "settle" the question of federal primacy and states' rights? (excellent section) pp. 84-85

[see what John Shadegg says here and here]

Two not-to-be-missed videos will quickly get you up to speed on the point of the book:
Jeffrey Tucker interviews Tom Woods
Tom Woods Gets Interviewed by a Zombie (hilarious!)

I definitely recommend the book for the subject matter and the strength of argument, it's just not an exciting read. and comes off rather academic at times

More on the rot that is the union-run U.S. government school system

High School Classes May Be Advanced in Name Only
More students are taking ambitious courses. According to a recent Department of Education study, the percentage of high school graduates who signed up for rigorous-sounding classes nearly tripled over the past two decades.
But other studies point to a disconnect: Even though students are getting more credits in more advanced courses, they are not scoring any higher on standardized tests.
The reason, according to a growing body of research, is that the content of these courses is not as high-achieving as their names — the course-title equivalent of grade inflation. Algebra II is sometimes just Algebra I. And College Preparatory Biology can be just Biology.
Lynn T. Mellor, a researcher in Austin, Tex., who has studied the phenomenon in the state, compares it to a food marketer labeling an orange soda as healthier orange juice.
“Like the misleading drink labels, course titles may bear little relationship to what students have actually learned,” said Dr. Mellor, who has analyzed course completion, test records and other student data in Texas. “We see students taking more and more advanced courses, but still not performing well on end-of-course exams.”
The 2009 results — the most recent available — of the federal test that measures change in achievement levels over decades showed that the nation’s 17-year-olds were scoring no higher in reading and math than in 1973. SAT scores have dropped or flat-lined, too, since 2000.
But a federal study released this month of nearly 38,000 high school transcripts showed that the proportion of graduates completing a rigorous curriculum rose to 13 percent in 2009 from 5 percent in 1990.
Arnold A. Goldstein, a director at the Department of Education’s National Center for Education Statistics, which administered both the federal test and the transcripts study, suggested possible causes for this apparent contradiction.
“There may be a ‘watering down’ of courses,” he said. Also, high school seniors may not try hard when they take the federal tests, because there are no consequences based on how they perform, he said.
Schools apply vaunted names to courses in part, researchers said, because administrators want to help students satisfy tougher requirements for high school graduation in many states. They point to parents’ interest in rigorous-sounding coursework for their children, and to administrators’ vanity in offering ambitious classes.
Some educators also argue that students benefit from being exposed to more difficult coursework, even if they do not perform well.
Mark S. Schneider, a vice president of the American Institutes for Research who headed the Education Department’s research wing under President George W. Bush, said the disconnect became apparent a decade ago, after two nationwide surveys showed that the proportion of high school seniors taking trigonometry, precalculus or calculus more than doubled from the early 1980s to the early 2000s.
“Students were taking more rigorous-sounding courses, but there was no evidence they had mastered the content,” Dr. Schneider said. Researchers at Michigan State University began studying the issue for a 2001 paper that drew on the test scores of 13,000 American eighth-grade students who participated in an international math and science exam known as Timss.
They compared the schools’ math courses — ranging from remedial through “enriched” to Algebra I — with the content of the textbooks used in them. In about 15 percent of the cases, the textbook covered less advanced areas of math than the course name suggested, said William H. Schmidt, who led the Michigan research.
In 2008, Dr. Schmidt surveyed 30 high schools in Ohio and Michigan, finding 270 distinctly labeled math courses. In science, one district offered Basic Biology, BioScience, General Biology A and B — 10 biology courses in all.
“The titles didn’t reveal much at all about how advanced the course was,” he said.
Course-title inflation is easier to document in math and science, researchers said, but they suspect it is happening in English and other subjects, too.
Growing skepticism among parents and policy makers about the rigor of high school coursework has been a factor, experts say, in the rapid growth of Advanced Placement, the College Board’s program of college-level courses.
Over a decade, the number of A.P. exams taken by American high school students has more than doubled, to 3.1 million in 2010 from 1.2 million in 2000.
Politicians and educators in many states have promoted the program, hoping to provide more rigor beyond the traditional curriculum. But the failure rate is also higher on A.P. exams, which are graded on a scale of 1 to 5. The proportion of exams earning low scores of 1 or 2 rose to 42.5 percent in 2010, up from 36.4 percent in 2000.
Trevor Packer, a College Board vice president, said his organization was wrestling with whether access to A.P. should be expanded even if that meant more students failed. For now, the proportion of low scorers is “tolerable,” he said.
Mr. Packer spent a recent week visiting A.P. classes in low-income schools in California, where, he said, he found the level of instruction surprisingly high and students well motivated.
“It was also clear that many students were being placed in A.P. who didn’t have the preparation,” he said. But the California principals argued that even students who score poorly in A.P. were better off than if they had taken only standard coursework, Mr. Packer said.
Bruce Orr, the principal of Lakeside High School, in Hot Springs, Ark., agreed. Mr. Orr’s students took 297 A.P. exams last year — eight times as many as in 2004.
“It’s about adding rigor,” Mr. Orr said about his campaign to increase A.P. enrollments.
Across Arkansas, the number of A.P. exams has nearly sextupled since 2000. The proportion of Arkansas students who score a 1 or 2 has surged, too, and is now the nation’s highest: 70 percent in 2010.
Mr. Orr said he was not concerned about how many Lakeside students each year earned high A.P. scores.
“Just being in that rigorous course environment does these kids a world of good,” he said.
Down a hallway, Corey Boby, a math teacher, was drilling his A.P. calculus students in derivatives, preparing for their exam next month.
“They’ll do fine,” Mr. Boby said. But he worried whether some students were fully prepared to take A.P. courses, which he likened to running a marathon.
“My concern is that we may push kids into marathons when maybe they are only ready to run a mile,” he said.
Brandi Davis, a student in Mr. Boby’s third-period class, Transitions to College Math, struggled to catch up, she said, after taking a chaotic eighth-grade math course in a neighboring district.
The course had a catchy name, she recalled: “Jungle Gym Math.”
“It had some geometry, some algebra,” Brandi said. “It jumped around.”

This SHOULD Keep RomneyFuck Out Of The GOP

RomneyCare's Unhappy Anniversary

Earlier this month, the landmark Massachusetts health care reform law turned five years old. Democrats were quick to applaud the anniversary, as the Bay State law is the model for the federal health care reform package that passed last year.
The anniversary has proved especially inconvenient for former Massachusetts Governor and probable Republican presidential candidate Mitt Romney, who argued forcefully for his state's reforms. In 2006 he boldly stated, "Every uninsured citizen in Massachusetts will soon have affordable health insurance and the cost of health care will be reduced."
Five years later, that prediction has proved false. Worse, the Massachusetts experiment offers an ominous preview of what lies ahead for the rest of the nation under ObamaCare.
When signing the bill into law, Romney claimed that it would "take about three years to get all of our citizens insured." In 2006 the number of uninsured in Massachusetts ranged from 372,000 to 618,000. Five years later, over 100,000 remain uninsured.
So more Bay Staters do have insurance. But that doesn't mean they've been able to get care.
The Massachusetts Medical Society found that 56% of physicians are not taking on new patients. Wait times for appointments are climbing. Just two years after reform took root, one clinic in Western Massachusetts had amassed a waiting list of 1,600 patients.
RomneyCare expanded coverage simply by putting more people on the dole. Since 2006, 440,000 people have been added to state-funded insurance rolls. Medicaid enrollment alone is up nearly 25%, and Massachusetts is struggling to cover the cost.
Of the previously uninsured individuals who have signed up, 68% are receiving free or subsidized coverage.
Many of these people aren't even citizens of Massachusetts. A recent report from the Massachusetts Inspector General found that state agencies have failed to implement controls to prevent ineligible people from making claims. In 2010 millions of dollars were spent on medical services for individuals from 48 other states and several foreign countries.

Despite the expansion of insurance coverage, people are continuing to seek routine medical care in expensive emergency rooms. Emergency room visits climbed 9%--or 3 million visits--between 2004 and 2008. The bill for uncompensated care has exceeded $400 million.
That's only the tip of the RomneyCare cost iceberg. Originally projected to cost $1.8 billion this year, the reform effort is now expected to exceed those estimates by $150 million. An analysis from the Massachusetts Taxpayers Foundation found that state spending on health care reform grew from $1.04 billion in 2006 to about $1.75 billion in 2010. Over the next 10 years, RomneyCare will likely cost $2 billion more than predicted.
Massachusetts taxpayers are not only footing the bill for all this new public spending--they're also facing higher rates for private coverage. A 2010 study published in the Forum for Health Economics & Policy found that health insurance premiums in Massachusetts were increasing at a rate 3.7% slower than the national average prior to the implementation of RomneyCare. Post-overhaul, they're increasing 5.8% faster. Annual premium hikes in the state have averaged 7.5% since 2000.
The average employer-sponsored family health plan costs nearly $14,000. That's higher than anywhere else in the nation.
Massachusetts businesses have felt the sting of rising health care costs too. They've had to shoulder an additional $750 million in costs since reform began to insure more workers and dependents. Massachusetts retailers report that their health insurance costs have risen 15% per year since 2006.
Bay State small-business owners like Donna Donovan say that the law has not helped them. Her small technology company has seen its monthly individual employee premiums almost double, from $500 soon after the law was signed to $992.
As health costs have risen public approval of the law has dwindled. A poll by Suffolk University found that 49% of state residents do not think that RomneyCare has been beneficial. That represents a 20% drop since the law passed in 2006. A mere 38% felt the law was helping.
Over the past five years, Massachusetts has spent billions expanding access to coverage--but has little to show for its efforts. ObamaCare has the country positioned to repeat the Bay State's mistakes--many more times over.

Fake I Tell You! But Who Cares At This Point?

Obama Birth Certificate is Just as Authentic as the Money Supply, the Food Supply and Obamacare

  • Thursday, April 28, 2011
The Birthers just don’t know when to quit, do they? Now that the White House has released President Obama’s birth certificate, the case is now closed, but they just won’t stop ranting about it. Why are these birthers still complaining?
They claim the birth certificate document is a fake. Why does that matter? But of course the document is a fake. It’s not “merely” fake; it’s so fake that the whole thing has become an IQ test for figuring out how many people can be so easily fooled by a fake (…). If I turned in a document like this as part of an effort to get a home loan, for example, and I assembled it layer by layer with obvious cutting and pasting of numbers from multiple sources in order to fake my reported income levels, I would be guilty of a felony crime. At the very least, I would be laughed out of the room. “Are you kidding me? This is your best attempt at falsifying an income statement?” they would say. Even a high school kid with a scanner and Photoshop knows how to make a more convincing forgery than this… (…)
For an explanation of why it’s all so obviously a fake, watch this:…
But I ask the far more important question: Does it matter that it’s a fake in the first place? Given that most of the U.S. government’s job statistics are fake, and that the U.S. dollar is being counterfeited on a daily basis by the Fed, and that virtually the entire U.S. economy is built on fake “abundance” that’s really just more debt spending… isn’t it is some way actually more authentic to have a President at the helm who faked his birth certificate?
It’s almost like he’s more qualified for the job, you see, running the fake economy with fake dollars while the mainstream media distributes all the fake news. And then in between the fake news bits, the advertisers come on and promote their fake foods, and fake pharmaceuticals which are approved based on faked science approved by FDA regulators who are faking it, too.
Couples are now artificially fertilized (fake conception!), and when their children are born, they feed them fake milk (infant formula). They grow up on fake sweeteners and fake (artificial) colors. In school, they’re taught fake U.S. history so that they have fake ideas of how the world really works. When they’re old enough, they get to participate in faked voting schemes where the winners are already determined.
And thanks to the internet, we live in a world of fake friends, fake emotions and fake sex. Football games are played on fake grass, and today’s “reality” TV shows are all faked, too. Professional wrestling is fake (but MMA isn’t), and most of the news consumed by the masses is entirely fabricated. Even the science behind most of modern medicine is faked, fabricated or twisted around in order to get the results the drug companies want to see.
And oh yeah, the drugs are faked, too, especially the antidepressants which appear to work only because of the Placebo Effect — which is real, even though it only exists in the mind.

We need more leaders who embrace fakery

For the most part, we are fake people living in a fake world engaged in fake interactions. So why shouldn’t we have a fake President with a fake birth certificate to top it all off?
I don’t know what the problem is here with the obviously fake birth certificate. Of course it’s a fake. But isn’t that what we vote for when we vote for any president? After all, presidential election campaigns are all about making fake promises uttered with fake smiles as part of faked speeches that are actually written by somebody else and read on the teleprompter.
In fact, I would argue that Obama’s faked birth certificate makes him more authentic than any other President in American history. It is precisely this mastery of fakery that has allowed Obama to deliver fake health care reform, faked world peace (new war on Libya!), and faked preparedness (radioactive fallout from Fukushima? Don’t prepare!)
It’s perfect for a nation of fake people who live in fake houses with the fake stonework plastered onto the front to make them look as if they were built out of stone. The people go get their cosmetic surgery and botox (faked youth!) so they can meet new fake people and pursue their fake relationships with faked orgasms. Their profiles on Facebook are completely faked; their resumes handed in at prospective employers are faked; and even their apparent “wealth” is faked because they’re neck-deep in debt on that luxury car parked in the driveway of the luxury house they can’t afford.
At work, they fake like they’re getting something done so that they can receive a paycheck that’s also largely faked because it’s denominated in fake dollars which are deposited in a fake (electronic) bank account so that the money can be multiplied and leveraged in order for the bank to keep creating more fake currency in the form of loans handed out to people who faked their credit history and lied on their loan applications. But who cares? As long as we all fake it together, the system works!
So we go shopping with our fake money and we buy fake “fashion” jeans with fake holes already pre-fabricated right into the pant legs, and we purchase our colognes and perfumes made with fake chemical fragrances that try to put a fake smell on our bodies so that we can meet other fake people who wear their own faked chemical smells to try to fool us into thinking they smell like fresh flowers and honey when, in reality, they stink like a country goat.
They use cosmetics to fake their skin health, and hair implants to fake their hair growth. Young girls are wearing fake contact lenses to fake their pupil dilation as fakes sign of faked sexual arousal. This is designed to get a rise out of their fake date partner who takes them to a fake restaurant to order fake food grown from fake (GMO) seeds and fertilizers with fake soils (made out of composted human sewage) which is contaminated with fake hormones (HRT drugs) and other drugs.
And the next morning they’ll wake up and share a bowl of faked blueberries in their faked breakfast cereals. Those have been faked, too, as shown in my video, “The Blueberry Deception.” (

Authentic leaders would fail

In fact, the whole matrix in which we live today is so universally faked and fabricated that I’m not sure that an authentic, genuine human being would even have a chance at leading the nation. We need fake Presidents to lead our fake nation into fake economic abundance, so all those “birthers” screaming about the faked birth certificate should frankly just shut up and eat their fake ham sandwiches made with that faked processed cheese food-like substance squeezed between two pieces of fake white bread.
Stop complaining and watch your fake “reality” TV shows, listen to the fake news, work at your fake government job and keep swallowing fake food so that you can become a highly-profitable patient in our faked health care system based on faked science and run by fake researchers. This is how the system works today. Reality has nothing to do with it, and you should abandon any such bizarre ideas. They’re unpatriotic.
In fact, the release of Obama’s birth certificate, with all its layers and Photoshop edits and mismatched numbers that were obviously assembled from multiple sources is not an admission of fakery — it’s a proud statement of authenticity! It says that our President is perfectly in tune with the faked society over which he presides. That’s what we need in America today; a genuine man of the People.
After all, only a true fake can achieve the level of fakery required in our world to be embraced as authentic.
And today, I bow down to the master of fakery; the man who is so authentic in his fakiness that he has released the world’s first authentic counterfeit birth certificate, proudly assembled from layers that would be widely considered faked by anyone who wasn’t sufficiently psychologically invested in the real world, by which I mean our faked society.
From here forward, I think we should all just start faking it. Reality, after all, is overrated.

The Preamble They Should’ve Written

Delete : "General Welfare"
Did the Founding Fathers get it right? Is the Constitution they drafted a secure basis for limited government? Many conservatives suppose so and believe the drift to big government has simply been a case of not reading the directions on the package. Last January these conservatives ordered that the Constitution be read aloud at the opening session of the House of Representatives, apparently hoping that the reverberation of its words off the marble walls would inspire lawmakers to return to the limited government of yesteryear.
I’m afraid it was an unrealistic hope. You can say many good things about the Founding Fathers, but these gentlemen fell short in one, critical way: The Constitution they drafted contains no significant intellectual impediment to the endless growth of government; that is, it does not explain what’s wrong with too much government. If anything, it goes in the opposite direction, inviting politicians to use the federal government to address everything. This invitation stands in the preamble, where after noting government’s obvious jobs — “establish Justice” (a court system), “insure domestic Tranquility” (armed forces to put down riots), “provide for the common defence” (armed forces to take care of foreign invaders) — the drafters added that government’s function was also “to promote the general Welfare.”
This phraseology may not have had much importance in 1787, when communication about national issues was limited. In modern times, however, the mass media turn every human need into a national problem that can be said to affect the general welfare:  unemployment, wages and working conditions, medical care, education, food production, science, natural disasters, and so on. Following the lead of the preamble, lawmakers feel justified in using government to address every one. The result is a big and ever-growing government.
“What Else Is There?”
What’s the way to stop this drift? For the answer, we need to examine the logic that drives governmental growth. The modern argument for government involvement looks like this:
1. Problem X affects the general welfare;
2. Government is the only institution that can address national problems;
3. Therefore, government has to step in and address X.
Notice how the argument depends on statement 2, that government is the only answer. If you accept that assumption, then you are pretty much bound to agree that government has to be involved. Not to agree makes you look cruel and insensitive, unwilling to fix the nation’s problems. And it doesn’t matter how badly government has performed in the past. Those urging more government concede that government is wasteful, often inept, and corrupted by special interests. But that doesn’t affect their position.  “We’ve got to do something,” they say. “After all, what else is there?”
Well there is something else, but we often overlook it because it’s not big, imposing, and centralized like government. It’s the millions of independent thinkers and doers who each day strive to make the world around them a better place, working individually, and joining together with friends and neighbors, in groups, churches, associations, and businesses. We can call this problem-solving system the private sector, or civil society, or the voluntary sector.
Although we often don’t stop to realize it, this collection of independent actors is working to address just about every national problem you can think of. Take disaster relief. On this subject standard political logic has taken us to a big-government solution. Hurricanes and earthquakes certainly affect the general welfare; therefore, we say, government must step in. So we end up with the Federal Emergency Management Agency. Many agree that this massive bureaucracy is inept and wasteful, but if you suggest closing it down people say, “We have to have it. When disaster strikes, we can’t just sit by and do nothing.” That’s the fallacy of assuming only government can solve problems.
When disaster strikes, the fact is that millions of individuals react in constructive ways. The people immediately affected do much to take care of themselves and their families. Neighbors pitch in to help neighbors. Businesses sell — or donate — needed supplies. Churches send aid and volunteers. Voluntary groups in other regions take up collections and send supplies. Businesses rebuild. Philanthropists support reconstruction projects. This vast multitude of helping hands is a disaster-relief system. The same is true for other problems: education, working conditions, medical care, and so on. The private sector can and does address all of these issues.
It’s biggest enemy, the institution standing in the way of this vital, intricate system of private, voluntary action is. . . government! It undermines the private sector in three ways:
1. Resources. Government’s taxation drains wealth from the private sector. Every dollar government puts into its programs comes, directly or indirectly, from individuals, businesses, and groups that would have used their resources to do what the government agencies try to do.
2. Regulations. Government’s rules and regulations are, like taxation, a burden on the private sector. Every minute someone spends filling out a government form is a minute he cannot use to help a neighbor.
3. Motivation. Private action is prompted by the belief that we make a difference. When people assume government is supposed to solve problems, it weakens their motive to help themselves, and it weakens their inclination to reach out and solve problems in their community.
In conclusion, if the Founding Fathers had wanted to block the drift toward big government, they should have written a preamble that extolled the virtue of the private sector, perhaps like this:
We the people of the United States of America, recognizing—
That the general welfare is promoted by individuals, families, neighbors, and societies
freely striving to improve the condition of mankind,
And further recognizing—
That government action often counteracts their independent, creative activities;
Do hereby establish a government which shall establish Justice, insure domestic Tranquility, and provide for the common defence.

Wednesday, April 27, 2011

33 Ways to Encourage Atlas to Shrug

Ayn Rand's 1957 novel "Atlas Shrugged" is enjoying renewed popularity following the release of the new Atlas Shrugged movie. Rand's story describes a group of American industrialists that lose patience with onerous regulation and taxation, and "shrug"--disappearing from their normal lives to relocate to a hidden valley called Galt's Gulch. While this tale is fictional, it has some strong parallels to modern-day America. And despite the fact that Ayn Rand was an atheist and favored legalized abortion, she was a good judge of both character and the inevitable tendencies of elected governments. When I consider the regulatory and tax burdens that have been implemented in my lifetime--I was born in 1960--I believe that Rand had amazing prescience. Let's face it: We no longer live in a free market capitalist nation. At best, it could called a "mixed" economy with statist tendencies, and verging on socialism.
Reading the news headlines in recent months has led me to believe that the Galt's Gulch concept has a lot of merit. If The Powers That Be wanted to encourage the Atlases of the world to shrug, they couldn't have done a better job. What is the best way to get the most productive Citizens of our nation to go on strike, and retreat to "gulches"? Consider the following "to do" list for those whom Ayn Rand called "The Destroyers":
  1. Remove the homeowner's mortgage interest tax deduction. Yes, they're pushing for it.
  2. Reinstate the Federal estate tax and pre-Bush Administration income tax levels. They want to impose the old tax rates on anyone with an income of $250,000. Oh, and the CBO's budget predictions are all using the assumption that the 2001 tax cuts are reverted. Is this wishful thinking (to make the increases in the Federal debt not look quite so bad), or a fait accompli?
  3. Nationalize IRAs and 401(k)s. Yes, its under discussion.
  4. Increase taxes for unemployment-insurance funds. This is already in progress.
  5. Drag out approval of new mining operations with endless Environmental Impact studies. They're already doing it.
  6. Inflate the currency to rob those who save money--a hidden form of taxation. Standard practice for 40 years.
  7. Drag out approval of newly-developed medicines. Now the status quo.
  8. Push up the rates for "sin" taxes on tobacco, alcohol, and other items. Already implemented in 2010.
  9. Increase the Minimum Wage. Several states have done so, but even worse yet, some unions are pushing for more socialist "Living Wage" laws
  10. Raise import tariffs. Each new tariff causes problems. Didn't they ever hear Ben Stein's high school Economics lecture on the Hawley-Smoot Tariff Act? (OBTW, Ben Stein is now warning about an economic collapse.)
  11. Increase the tax paperwork burden by requiring "1099-MISC" reporting of all cash transactions over $600. (Attempted, but thankfully set aside for the time being.)
  12. Increase the cost of doing business through mandatory insurance. (The "labor burden" for an employee with a nominal salary of $17 per hour ($35,360 gross, annually) is an additional $20,029 per year.) Workman's compensation, in particular, is getting painfully expensive.
  13. Increase sales taxes. Several states have increased sales taxes, since 2009.
  14. Increase property taxes, as home values decline. Many counties have hiked their tax rates.
  15. Continue to increase the size of the government (and its debts). The Federal debt increases are looking inexorable.
  16. Push for increased mandatory employer-paid benefits for company employees like mandatory health insurance for part-time employees and European-style long term parental leave. Also, push toward excluding companies from government contracts unless they have expanded health care coverage.
  17. Mandate payment of state sales taxes on out-of-state purchases for Internet and mail orders. Yes, they're still pushing for these taxes, and for regulation of the entire Internet.
  18. Create a pervasive Nanny State mentality. For example: penalize companies and consumers for high trans-fat foods, and alcoholic beverages that taste too good.
  19. Sue the makers of guns that actually work just as they were designed. (At least a partial law shield law was enacted, in 2005.)
  20. Use taxpayer funds to destroy classic cars that are in running condition, while subsidizing hybrid cars that use batteries that will pollute landfills for centuries.
  21. Over-regulate small firms out of business. Dry cleaners are a prime example.
  22. Fine farmers and ranchers for using traditional practices.
  23. Create a European-style Value Added Tax (VAT). Yes, they're still pushing for it.
  24. Legislate expansion of company-paid health insurance to cover everything from same sex "domestic partners" and autism to sex change operations.
  25. Lobby for mandating that companies pay for three weeks of paid vacation per year for all employees.
  26. Institute dozens of unfunded mandates from the Federal level, that must be compensated for with higher state, county, and local taxes.
  27. Increase license, permit, and vehicle registration fees. In progress. Meanwhile, institute "temporary" tax increases. These surtaxes on income, sales, or real property are described as "temporary." (But don't be surprised if they are not repealed.)
  28. Providing free education to illegal immigrants while levying taxes on home schooling families for services that they don't use.
  29. Make it illegal for owners to protect their livestock from predators.
  30. Remove the salary cap on Social Security tax "contributions". The liberal think tanks are pushing for it.
  31. Encourage a litigious society where huge lawsuits are filed over trifles, and where the makers of products can be sued even if product buyers intentionally misuse products.
  32. Implement carbon taxes and credits. Still in early stages of implementation.
  33. And lastly, the big one: Implement socialized medicine. Despite a strong public outcry, it is now Federal law. But thankfully there is a push to rescind part or all of it.
The shrugging and gulching has already begun...
Reading the foregoing might have you inspired to find your own Galt's Gulch. Although I admit a personal bias, one practical option that I can suggest is the American Redoubt. (I'm the originator of the plan.) The Redoubt region is inside of the continental United States, so moving there is much more realistic than moving offshore--at least for most of us.
Many folks are now ready to vote with their feet. Atlas is starting to shrug.

The Jubjub Hole ~ With Apologies To Dr. Seuss

In the kingdom of Whatsis, on the Island of Ooze,
Lived a gaggle of Spendits of two different hues.
Each Spendit was feathered, each Spendit was plump,
Each walked with a kind of galumpety-lump.
They all looked alike, although it is true
Some Spendits were Red, and others were Blue.
But regardless of color, they all loved to eat
The fruit of the jubjub: It was juicy and sweet —
Like an orbulus orange, but tastier yet
And filling, and wholesome, and wetter than wet
And it gave them a case of the all-over yummies
As soon as a bite of it tickled their tummies.
The jubjub had grown on the Island of Ooze
For centuries — Eons! — Millennia! — choose
Your own measure then times it times ten;
The tree had grown giantish even back then.
And none of the Spendits, who were all rather small
Had ever seen anything close to it all.
But the Spendits did not merely eat the fruit — no!
They took jubjub twigs and arranged them just so
Into houses and stables with jubjub-leaf roofs,
And they used jubjub seeds to make goomfa-la-goofs
Which they slowly paraded 'round Jubjub Tree Park,
Which they'd paved, as you've guessed, with jubjub tree bark.
And everything oozlered on for a while,
With the Spendits all living in comfortable style
And the jubjub providing for every need;
Life in Whatsis was good, all the Spendits agreed.
Not a thing in the kingdom would now be amiss
If the Spendits had simply left it like this.
But oh no! — for you see, the Spendits grew greedy
And the Spendits with needs grew even more needy
And the ones who had plenty felt they deserved even more
So all of the Spendits Spent more than before.
Who started it off, no one ever quite knew —
Though they all blamed each other, as Spendits will do.
First little by little, then a lot by a lot
The Spendits began Spending more jub than they got.
An extra leaf here or a bit of fruit there —
Why, no one would miss it! Why, no one would care!
The tree was so big and the Spendits so bitty
That to not help themselves seemed almost a pity.
And besides, the jubjub had so many fine uses!
They Spent it for carpet, and fleeces and flooces,
And wingdigs, and wackmeres, and snorples and sneetches,
And fabric for jerkins and waistcoats and breeches.
They used it for tires and hung it as art —
Everything on the island had some jubjub part.
Then one day a small Spendit named Melody Monk
Was alarmed to discover the jubjub had shrunk.
It couldn't be possible! Yet it was so:
The nine-hundred steps that it took her to go
From Branch A to Branch B took eight sixty-three —
And since SHE was the same size, it must be the tree.
Then soon other Spendits began to take note —
So they made measurements, which they carefully wrote
In jubjub-leaf ledgers, so they could compare
How much jubjub there WASN'T with what USED to be there.
"Our jubjub is shrinking!" they cried in dismay
As they hacked off more pieces and dragged them away.
They formed a commission to study the tree,
And built it an office — then two, and then three —
And they staffed them with scholars, and clerics, and clerks
Who stayed up all night reading mystical works
So the blue-ribbon panel could answer the riddle
Of what could be making their giant tree little.
They studied two decades, then three, and then four,
While the Spendits kept Spending the same as before
And the jubjub kept shrinking, 'til one day they found
The top of the tree just an inch off the ground.
The leaves and the branches were all gone, it was true —
Which left them with only one thing left to do.
The top of a tree is not NEARLY as big
As the part underground — so they started to dig.
They brought in a giant jub-powered steam shovel
To dig out the roots, while back up above-l
The Spendits kept Spending jubjub for whatever
Seemed useful, or needed, or fancy or clever.
But once in a while they would pause and look down
At the hole that was growing below them, and frown,
And argue about which of them was to blame
For the gash in the ground — for it seemed quite a shame
That right in the middle of Ooze there should be
Such a black deficit where there once stood a tree.
"Our children!" they cried, in a voice like a moan
"There will be no more jubjub when they are all grown
If we keep digging like this! We must stop it right now!"
The problem, of course, was they didn't know how.
They'd gotten so used to their jub-Spending ways
That anything else left them lost in a daze.
"This is YOUR fault!" said some of the Reds to the Blues.
"You and your snork-snackered bar-bufaloos,
"Your fancy-dress gowns and your jewel-covered glasses
"Have left nothing left for the Red Spendit masses!
"Why, none of us Reds would have cause for complaint
"If you greedy Blues had just shown some restraint!"
"Oh, it IS?" said the Blues, as they drew themselves up.
"What about your wumbulus flupper-de-flup?
"Your mingulous gomers and two-decker kleetches?
"Your hair bows and bracelets and lace-covered breeches?
"Your Ooze Day Parades and your cakings and ices?
"You Reds are the Spendits to blame for this crisis!"
So there they all stood, pointing fingers and yelling
While below them the black hole kept growing and swelling.
And then at the moment of greatest confusion
The panel announced it had reached a conclusion:
The Kingdom of Whatsis was bound for disaster.
The Spendits all nodded, then Spent even faster.
The last that was heard, from fifteen miles below ground
Was a very faint, kind of a grubulous sound.
The Spendits had all fallen in, don't you see,
In the hole they had made of their glorious tree —
And many years later they're bickering yet
Over who is to blame for their national debt.
But nobody else cares — no one even remembers
The kingdom of Whatsis or its big-Spending members,
Who could have been spared a horrible fate
If someone had only stood up to relate —
In the midst of their jubjub consumption and gigging —
The First Rule of Holes: When you're in one, quit digging.

Big investors see possible long-term currency weakness

Last month, Warren Buffett went shopping — abroad.
He flew to South Korea for a factory opening and called the country a “hunting ground” for investments. He also pronounced post-earthquake Japan “a buying opportunity,” and then traveled on to India, where he said he was eyeing more acquisitions.
This is Buffett’s way of betting against the U.S. dollar. Armed with about $38 billion of cash at Berkshire Hathaway, he can use dollars now to buy companies that will generate profits in other currencies for years to come. (Buffett is a director on the Washington Post Co. board.)
“I would recommend against buying long-term fixed-dollar investments,” Buffett said at a public appearance in New Delhi. “If you ask me if the U.S. dollar is going to hold its purchasing power fully at the level of 2011 five years, 10 years or 20 years from now, I would tell you it will not.”
Buffett isn’t alone. Some of the most successful investors in the United States and the biggest money management funds are worried that trade deficits, big budget deficits and the possibility of renewed inflation will make the U.S. dollar a weak currency compared with others around the world. On Thursday, the dollar fell to an 181 / 2-month low against the euro.
Bill Gross, chief executive of the giant bond investment firm Pimco, said its flagship Total Return Fund has 8 percent of its assets — a historic high — in issues denominated in currencies other than the dollar. Earlier this year, the fund dumped its entire holdings of U.S. Treasury bonds, according to disclosures.
“The United States is one of the serial abusers of deficits and inappropriate budgets and finance,” Gross said in an interview. “Do the headlines in terms of debt ceilings and 10 percent budget deficits and the back-and-forth between Republican and Democratic orthodoxies, does that matter? Sure it does. It’s not confidence-inducing.”
Gross said the decline of the dollar is part of a longer-term trend Pimco calls “the new normal.”
“We are in this new-normal type of economy in which the developing world is growing at a far faster pace than the developed world,” he said. “And growth tends to be reflected in terms of currency value.”
The dollar may still have more room to decline against other currencies. Gross noted that the currencies of many Asian economies are still 50 percent or more below their levels before the Asian currency crisis of 1997.
In March, the dollar — adjusted for inflation — hit its lowest point against major U.S. trading partners’ currencies since its value was allowed to fluctuate in January 1973, according to Federal Reserve data.
“This is the true measure of what the dollar’s worth,” said Kenneth Rogoff, a Harvard economics professor and former chief economist at the International Monetary Fund. “It shows what you can buy with the U.S. dollar.”
A weak dollar isn’t necessarily a bad thing, Rogoff said — it can make the United States more competitive, bolster exports and help domestic companies that are vying against imported goods here in the United States.
It effectively would be playing the China card against China in a battle for manufacturing jobs.
Gross cautions investors that in the short term the dollar might not get much weaker than it has already.
“It’s not necessarily as great a bet to be short the dollar and long something else as it was 12 months ago,” he said, adding that if you are betting against the dollar, “you still get a green light, though 12 months ago it was a brighter shade of green.”
Yet some analysts say the dollar could face a rocky patch in the next few months and tumble further as Congress and the White House struggle over raising the debt ceiling and forging a budget for the 2012 fiscal year.
“One of our key themes is that there is a chance for an expedited decline in the U.S. dollar,” said Daryl Jones of the research and consulting firm Hedgeye. “The way the calendar is lining up in Washington, there will be opportunities for global currency traders to vote against the dollar.”
If the dollar were to lose its status as the world’s reserve currency — which means that most international transactions and commodities are priced in dollars — that could raise costs for the U.S. economy.
One element slowing the decline of the dollar is that currencies are in a race to the bottom. U.S. debt and deficit problems are not much worse than those of many other nations. Japan has debts equal to roughly twice its gross domestic product. Britain is hobbled by similar deficits and is slashing spending. And the euro zone is crumbling at the edges, from Greece to Portugal and from Ireland to Spain. Meanwhile China, whose currency is pegged to the dollar, is wrestling to tame rising inflation.
Jones says, however, that the United States is worse off by many measures. He pointed out in his morning note to clients Thursday that the ratio of the U.S. deficit to the country’s GDP is only slightly lower than Sierra Leone’s. He also says that Britain is tackling its deficit, bolstering the pound. And China is taking on inflation by increasing reserve requirements for banks.
Moreover, the U.S. deficits seem likely to continue for years. Under current law, the federal government will run deficits totaling $4.5 trillion over the next five years; by 2021, the federal debt held by the public would soar to $19 trillion, up 75 percent from 2011, according to the Office of Management and Budget’s 2012 proposal.
Many fund managers say the only way out of that box is a weaker dollar, reducing the value of the massive amount of U.S. debt held by foreigners and increasing the value of American investments abroad, such as Buffett’s.
“Countries like the United States do race to the bottom,” said Gross, though he added that Treasury Secretary Timothy F. Geithner would never say so. A weaker currency “makes them more competitive and reduces the burden of debt,” Gross added. Americans own about half of the outstanding federal debt, but Gross said the rest is owed “as Tennessee Williams would say, to strangers, outside the U.S.” If the United States “can devalue the value of those dollars that they owe, then all the better.”
Asked by Bloomberg News whether the U.S. dollar is still one of the safest assets, famed currency trader and fund manager George Soros said: “Well, it is considered to be riskless. But it’s really a question of the degree that you may have inflation in the future. Because . . . one of the ways in which you can reduce the burden of debt is by having some degree of inflation.”
While Soros added that he did not think there were “any great inflationary pressures in the United States” now, he did worry about the difficulty of maintaining a modest degree of inflation without letting it get out of control.
Concerns about inflation and financial instability in general have helped drive up the price of gold to record levels, above $1,500 an ounce. Some analysts also say the weak dollar is one reason why the cost of crude oil, which is priced in dollars, has been approaching record levels. On Thursday, a barrel of oil settled above $112.
But Rogoff warned against reading too much into short-term currency movements. For example, he said, the Japanese yen has increased in value since the earthquake.
“I think at the end of the day that the tsunami was not helpful to Japanese deficits or anything else,” he said. “Thousands of academic papers have shown that it’s very, very hard to explain short-term movements.”