Peter Schiff's Parallel Universe and Ours

Under discussion: How An Economy Grows And Why It Crashes by Peter D. Schiff and Andrew J. Schiff, 233 pages, $19.95, Hardcover.

In that parallel universe Peter Schiff is probably winning his race for Senate.

But here in the United States of Criminals, Celebrities, and Corporations, he barely has ballot access in the Connecticut race to replace Chris Dodd where he trails such Republican heroes as WWE First Lady Linda McMahon and former congressman Rob Simmons before Simmons dropped out.

The groundswell for a Schiff candidacy emerged in the aftermath of the 2008 financial collapse which Schiff had predicted for years, explaining that the illusion of wealth created for the housing boom could not be sustained and that the inevitable bust would spread to other sectors of the economy. A mash-up video of his appearances on various financial TV shows in 2006 and 2007, where he was openly derided and actually laughed at, is titled “Peter Schiff was Right” and has been a Youtube sensation with over one million views.

So just how did Peter Schiff, president of Euro Pacific Capital brokerage firm, know that the economy was going to crash when almost every pontificator on both sides of the aisle was promising that the good times would never end? Did he have a crystal ball? Was he imbued with special powers to see when those unpredictable financial catastrophes are barreling down the road?

Well, one thing Peter Schiff was blessed with was a father who discovered the Austrian school of economic thought after breaking out of the New Deal orbit sometime during the 1950’s.

Schiff’s father, Irwin, is well-known among anti-IRS crusaders and perpetual victim of the income tax tyranny. At 82, Irwin is currently in federal prison (not for the first time) after unsuccessfully challenging the tax code.

But when Irwin was much younger, he entertained his boys in long car rides with economic lessons disguised as stories. One such story was “The Fish Story” which Irwin turned into a book in 1979 entitled, How an Economy Grows and Why It Doesn’t. In 2010 “The Fish Story” was modified and turned into How an Economy Grows and Why It Crashes.

At first, How an Economy Grows almost seems an odd selection for a traditional review because it is so simple and straightforward. Since the inspiration for the book is a children’s story, it’s written on a level anyone can understand. And with many of the fictional characters (from Ben Barnacle to Tricky Dickson) based loosely on real people it is certainly entertaining for adults.

The narrative can really be split into two sections. The first half is about how a primitive society began on a remote island. From there the reader is introduced to basic Austrian economics through fish. Since fish is the abundant material on the island and holds real value for the islanders it is the obvious choice for currency. The fish had value everyone on the island could appreciate and understand. Someone wants a canoe? That’ll be nine fish. That might be a lot of fish, but a canoe was a luxury and cost a lot to construct.

Then as time progressed and people had more fish on hand they discovered they needed some form of fish repository – a bank!

With depositors fish could be loaned out to prospective entrepreneurs. If the would-be businessman had a good opportunity to repay the loan with interest then there was a better chance he could get the loan in the first place. The bank might have to turn people down for loans, but they had to because they were at risk themselves. What if the loan was issued to someone who couldn’t handle it and defaulted? Who would bail them out?

Here the reader learns about the basics of banking, lending, credit, and saving.

As the people of the island increased their numbers they realized they needed some form of government and so the second half of the story begins and the republic Usonia was born. Governed by 12 senators including an executive Senator in Chief, a constitution was written so that the senators would not overstep their authority.

But after a few generations, the Senate’s wise and prudential statesmen were replaced by more appealing “go-getters.” Schiff portrays the moment things changed when Senator in Chief hopeful Franky Deep came into power:

“He observed that people loved getting stuff for free. Similarly, they hated paying taxes. So, he devised a plan: if he could find a way to make it look like he was giving something to the islanders for free, then he could gain their unconditional support. Unfortunately, all the government had was what it raised in taxes. The Senate didn’t catch any fish. They could only give by taking. How could they give away more than they took?

“After a particularly bad monsoon, Franky sensed an opportunity (politicians never let a crisis go to waste).

“He preached, ‘My fellow islanders, the storm we have just been through has wrought untold hardship on our people. Many of our citizens are now hutless and fishless.

“’We cannot stand idly by and do nothing. If elected, I will institute a government reconstruction program for our neediest citizens to repair the damage.’ But he assured the citizens that the cost of the construction would be paid for by the economic activity the spending generated.

“His opponent, Grouper Cleveland, offered nothing, except wise stewardship of the island’s savings and a promise not to interfere with the liberties of the citizenry.

“Not surprisingly, Franky Deep sailed into office as Senator in Chief.” (104-105)

With the institution of paper money in the form of Fish Reserve Notes, redeemable pieces of paper backed by real fish in the vaults, the rest of the story is laid out:

“The new bank director . . . was not crazy about the new fish notes. He thought the ease in which the notes could be printed would create dangerous incentives for the senators. Yet, he could sleep soundly at night provided that the government maintained enough actual government fish in the bank to redeem all the notes.

“Not surprisingly, his confidence didn’t last long.

“Soon, Franky and his agents had handed over far more Fish Reserve Notes than the government’s account had fish to redeem.”

“’Franky, stop the presses! . . . I have only nine fish available for every 10 notes that you guys have handed out. If the savers figure out that there really aren’t enough fish to cover their deposits, there will be a run on the bank and I’ll be out of fish. . . .’” (107)

Slowly but surely all of his successors followed Franky’s lead. The newly-appointed bank chairmen, beginning with Ally Greenfin and later with Ben Barnacle, followed in giving the government what they wanted. After Franky Deep came Lindy B, promising to

“Furnish the canoe navy with bigger spears, but he would also help the sagging economy by 'providing emergency unemployment fish notes to all laid-off workers' prevailing over Buddy Goldfish who offered nothing but careful stewardship of the island’s savings and boring protection for the islander’s economic liberties. More importantly, Buddy argued that the island could not afford such an extravagant ‘spears and fish’ policy.

“Not surprisingly, Lindy won in a landslide.” (126)

And comparably broad parallels to modern America finish out the story.

Humorously illustrated, Schiff’s story is a pleasurable read. It demonstrates that basic knowledge of economics is simple and that the laws of economics apply the same to complex societies as they do for simple ones. In short, if more saving is necessary for people on a small island to recover from disaster then saving is what is necessary to rescue a large society.

Peter Schiff will certainly not win his election for U.S. Senate in Connecticut. But he has bequeathed a valuable chapter of economic education to his country.

Perhaps this time people will listen.

No Shame: The Case Against Mitt Romney

Under discussion: No Apology: The Case for American Greatness by Mitt Romney, 323 pages, $26.95.

It’s hard to imagine a worse presidential contender than Mitt Romney. Yet, he nearly won the 2008 Republican presidential nomination and whether conservatives will admit it or not, Romney is the most likely member of the party to win the nomination in 2012.

The flip-flopping, status quo defending, conventional wisdom-spouting pol is certainly viewed as “safe” and “electable” by the Republican establishment and as a “tolerable Republican” by the Democrats. 1964 excepted, this is the course Republicans always take. Despite the grassroots’ anger over Romneycare becoming Obamacare, Republicans should get comfortable with a Romney candidacy.

Editors Rich Lowry and Kathryn Jean Lopez of National Review, the so-called mast of so-called conservatism, are still behind him. A Rasmussen poll shows that Romney, three years out, is the strongest Republican opponent to Obama -- a 45-45 statistical dead heat. The same poll says Obama would beat Sarah Palin 48-42. Mike Huckabee’s political star is fading and the party still refuses to acknowledge the existence of Ron Paul who will be 76 during the primary season.

Make no mistake, Mitt Romney is running for president. Nobody writes a book like No Apology unless they’re running for something. And Mitt Romney is always running for something. With entire chapters dedicated to topics such as health care, education, energy, and four chapters wailing about foreign policy, Mitt Romney intends to be president.

But if Romney thinks he will be able to effectively challenge President Obama in 2012, he does have some convincing left to do – and not just the Democrats he spent his pre-2008 political career trying to schmooze.

While he should face little resistance to his atrocious foreign policy, the GOP base is sure to have huge question marks about Romney’s unfolding positions on abortion, gay marriage, and the bank bailouts.

The American Conservative columnist Daniel Larison has quipped that Romney should just not talk about foreign policy because he seems hopelessly confused, conflating differing sects of Islam with each other, exposing inexcusable ignorance of the millennia-old rivalries between Sunni and Shiite. But as George W. Bush proved, simple regional and religious ignorance may be just part of the job qualifications.

The self-stated purpose of No Apology is that American greatness is inherent and there is no reason for America to feel sorry about anything ever, the meme used by statists in both party to indicate that there is no difference a government and its people.

Through this, it is implied that No Apology is the antithesis to the supposed “Apology Tour” of President Obama. In practice, the purpose seems to be that Mitt Romney believes he can take both sides of an argument at the same time and think that that makes him smart. Also, it becomes evident that in addition to offering no “I’m sorry”’s, Mitt Romney offers no justifiable defense, or apology, for past Republican failures he fully intends to repeat.

An example of this shows up in Chapter 2 when Romney gives a great deal of attention to why great nations fall i.e., when they isolate themselves and refuse to accept the changes of modernity:

“While Europe embarked on the early stages of manufacturing, the Ottomans did not; . . . The Ottomans’ growing isolation from the dynamic world of manufacture and trade was reinforced by the conviction that their holy scriptures provided all the knowledge that was necessary; foreign technology was infidel technology. The empire banned the printing press for half a century.” (37)

And about China:

“For the Ottomans, the Qur’an contained everything that life required; for the Chinese, it was their ancient culture . . . But rather than viewing learning and innovation as paths to prosperity, [Mao Zedong] saw them as threats.” (39)

Remarkably, the author of No Apology wrote the following statements in Chapter 3:

“. . . Mao never really took to modernity and technology, and his military continued to reflect that prejudice, maintaining a massive four-million-soldier army as only a weak compensation for the nation’s obsolete or non-existent weapons systems and logistical support. It wasn’t until approximately twenty years ago that China decided to build a modern world-class military. . .”

“Rather than embracing discovery, the Islamic fundamentalists condemn it. For them, the Qur’an contains all information and learning that is needed, and everything that should be known. In this view, modernity itself is evil – contemporary law, business practices, social mores, tolerance, rationalism, and scientific inquiry are heresy. And as the world’s epicenter of innovation and intellectual discovery, America is emblematic of the world’s sinful pursuit of everything forbidden by Allah.” (64-65, 66)

It’s difficult to concisely summarize Romney’s cognitive dissonance. On the one hand he seems to argue that great and powerful nations fall when they refuse to adapt to change and embrace technology and modern innovations. He uses the dissolution of the grandest Islamic empire as evidence of that. But on the other hand, bands of terrorists who do not accept modernity and represent a backward worldview, are inexplicably more dangerous than the Ottomans themselves or Mao’s pre-modern military.

But this is also symptomatic of the fundamental phoniness of Mitt Romney.

He draws some comparisons from history and hopes the reader will accept Romney’s façade of intellectualism at face value. How can Romney honestly think, six inches beneath his mound of hair gel, that 4 percent of GDP is required to battle an enemy that he has already explained has sown the seeds of their own futility by refusing to accept modern innovations?

Even on a subject on which Romney is generally accepted as having unique knowledge, the economy, he again shows himself riding both sides:

“It doesn’t make sense to bail out individual companies or banks or financial institutions that get in trouble. As we’ve seen, creative destruction is part of a growing, productive economy. Bailing out sick enterprises . . . merely prolong the final act.

“But Secretary Paulson’s proposal was not aimed at saving sick Wall Street banks or even at preserving jobs on Wall Street. . . . It did in fact keep our economy from total meltdown. (127-128)

Here Romney uncritically repeats the conventional wisdom used by both corporate parties to justify the largest redistribution of wealth in history. What’s worse is that he essentially repeats Bush’s lie that he had to abandon his free-market principles to save the free market.

This time, it’s Romney who is fine with abandoning the concept of “creative destruction,” the way the market rewards good businesses and eliminates poor ones, for a titanic propping-up of the banks, as if their industry should have been immune from the laws of economics.

Apparently it has never occurred to ol’ Mitt that much of the American economy was already propped up by an illusion of wealth created by the Federal Reserve and that rescuing the banks only prolongs a tragic final act that is yet to come.

But perhaps Romney’s most brazen attempt at obfuscation is the most predictable one: Massachusetts health care.

It isn’t difficult to see why. Just as Romney’s amorphous position on abortion (one dependant on which office he’s seeking), might have been enough to derail his 2008 presidential bid, his signature achievement as governor of Massachusetts is what is temporarily angering conservatives in 2010.

He addresses the situation in Chapter 7, “Healing Health Care”:

“In 2009, the national health-care policy supported by President Barack Obama was often and erroneously reported as being based upon the plan we had enacted in Massachusetts. There were some very big differences – in particular, our plan did not include a public insurance option.” (176)

On this much Romney is right. At the time of the book’s writing, the so-called Massachusetts Model, which mandated that all citizens purchase health insurance, was not the same as the public option plan that was eventually discarded.

However, since No Apology went to press, the new health care law, which mandates health insurance for all Americans, does more closely resemble the Massachusetts Model, casting the proverbial aspersions on Romney’s claim that his model is different and likely putting a smile on Obama’s face when he sees Romney’s blabbering doubletalk on TV.

Republicans salivating at the prospect of an inevitable Obama defeat in 2012 should exercise caution when assuming that any suit or skirt will win. The Patient Protection and Affordable Care Act might be ancient history by then and Mitt Romney is just unprincipled enough to play John Kerry to Barack Obama’s George W. Bush.

And there would be no apology big enough for that.

Cash for Clunkers Flunks Out

The following letter appeared in the Wednesday, August 26, 2009 edition of The Nashville (IL) News.

While enthusiastically received, the government's Cash for Clunkers program is but a band-aid that offers no long-term solutions.

We have been told that since so many people have lined up to exchange their "clunkers" for a rebate to buy a newer, fuel-efficient car, the economy is turning a corner because people are spending again. But it seems like no one is asking where the money for these rebates is coming from. The government is in spiraling debt, but taxes haven't increased nor have any programs been scaled back, so we know that the governent hasn't raised any new revenue.

Where did this money come from? It had to either be borrowed or printed out of thin air. In either scenario, we are all further in debt or face inflation. What this means is that at a time when people should be saving their money, the government is encouraging people to accrue more debt.

We are not far removed from the housing crisis that resulted in millions of people facing foreclosure and repossession. The money supply was expanded to accommodate all the loans issued that ultimately could not be paid back. Even with generous rebates, we will ultimately face inflation, and poorer folks are destined to default on car payments. And even though people flocked to car dealers for a couple of weeks, factories are not re-opening, closed dealerships remain closed, and workers are still laid off.

Like a shot of morphine, Cash for Clunkers makes us feel good about the economy for a little while, but eventually the high goes away and we return to reality. And that reality is that Cash for Clunkers was a $3 billion program that brought no new jobs to a struggling economy and deepened the debt.

Happy driving.

Carl Wicklander
Nashville

Cash Clunker

*This post is a little old. It was composed before a trip I took to my old Kentucky home. This issue has faded somewhat, but the same problems exist.



The recession is on its way out! The “Cash for Clunkers” program has been a rousing success. The government agreed to give away money and people surprisingly lined up with their hands eagerly held out. The government printed up money (“It’s free money from the government!”) and the auto industry is back on its feet and soon it will be better than ever.

If only.

The lunacy of the Cash for Clunkers boondoggle is a testament to the government’s inability to learn from its mistakes.

Like the vaunted stimulus earlier this year, the “Cash for Clunkers” program was sold to the public as the avenue through which the economy will be jump-started. Just throw some money at a problem and like magic, it will go away. People aren’t buying enough cars? The solution must be the government paying people to start the process.

Unsurprisingly, the initial response to the program was successful. Despite saying that they are tired of others getting tax breaks and special treatment, people are generally receptive when they are the ones getting “free money” from the government.

So people are now buying new cars, maybe even American cars. That’s great, and all it took was a little government spending, $1 billion, to get the ball rolling.

And just like the housing bubble that inevitably burst, the “Cash for Clunkers” program is but a band-aid that brings no permanent relief, much less stabilization.

At a time when jobs are still not coming back, “Cash for Clunkers” offers no genuine solutions. Sure, people are buying cars, but does that alone mean the economy is on the way back? Closed dealerships remain closed. Factories aren’t reopening. The only certainty to come out of “Cash for Clunkers” is that it plunges the United States and its citizens further into debt.

Less than a year after the housing market hit rock bottom, people seem to believe that the government can create money out of thin air, pass it out, and then think that reality won’t set in when the money cannot be paid back.

Look at the housing crisis. Credit was massively expanded making more “money” available in the form of loans so that people traditionally deprived of loans could buy the home of their dreams. But the bills came due and people who should not have been approved for loans in the first place lost their homes. The same thing can’t happen to eager car buyers, can it?

The same general principle is at work in “Cash for Clunkers.” People are enticed with money that appeared out of nowhere so they can buy a new fuel-efficient car that they don’t necessarily need.

For a country that is still suffering through a recession and incalculable debt, it is dumbfounding to see that Congress and President Obama believe that creating more debt will somehow alleviate the current problems. It’s as if a doctor treating a stab wound victim decides that shoving the knife deeper into the tissue will make the stab wound go away. It makes no sense.

This program brings only temporary benefits but it cannot go on forever. Eventually the program will stop and lots of people will probably default on their car payments making this whole exercise a waste. But in the meantime, it’s quite likely that the same logic, handing out money, will be extended to some other industry. The U.S. Postal Service is in some financial trouble and thousands of offices might close. Will the government begin handing out tax rebates so we’ll send out more packages from the post office? Will they raise taxes to support the next scam?

Not likely. We already hear that taxes cannot be raised because we’re already in a recession and people can’t be deprived of yet more of their money. But isn’t that what “Cash for Clunkers” inevitably leads to? People losing yet more of their money for cars they might not even need?

The program encourages more spending when people should be saving.

But stopping programs like “Cash for Clunkers” is only stopping a symptom. It is the entire mentality that government can just hand out money to spur spending that needs to change. And the entity that needs to be confronted is the one that makes such schemes possible in the first place. It is not President Obama or even the dim-witted Congress, but the Federal Reserve, that giant printing press.

Printing up money that doesn’t exist is exactly what gets average citizens thrown into jail. But as long as the government has a “private” agency that officially finances its spending, people can be convinced that their taxes won’t have to be raised so the auto industry can stay afloat or that government-run health care is even remotely possible.

But before the Fed can be stopped, it has to first be examined. That is what Ron Paul’s “Audit the Fed” is designed to do. Already with over 250 co-sponsors in the House, the companion bill has a growing number of co-sponsors in the Senate. If we can expect government spending to actually slow down or even stop, we have to stop the mechanism that makes deficit spending possible.

To adapt from the historian Tom Woods, To stop the spending machine, you have to go after the money machine.

Audit the Fed.

Stop It!

One of my favorite Mad TV sketches features Bob Newhart, as a therapist whose only advice to any patient was contained in two words: Stop it! When a woman who suffers from an irrational fear of being buried alive in a box comes in, his advice is the same: "Stop it!" No matter what inner difficulties the woman brought up, the therapist’s answer was always “Stop it!” I heartily recommend that our lawmakers see Bob Newhart’s most recent rendition of therapy.

One of President Barack Obama’s first initiatives as the chief executive is to implement an economic stimulus package that he repeatedly tells his countrymen is designed to save the American economy from the catastrophes of tax cuts and capitalism.

It should not be too surprising that Democrats wish to pass a package that would be the more invasive than any government measure into the economy since the New Deal, at a time when the current hardships are still nowhere near those endured during the Great Depression, which was only exacerbated because of those interventions. In short, the stimulus package is not so much meant to stimulate the economy, but an initiative to create more political capital for the new president. One portion that has since been excluded from the package, perhaps due to its sheer odiousness, was bailout money for Planned Parenthood (I don’t know about any of you, but I don’t believe the killing industry has any shortage of business).

The more President Obama says some version of "We have to do something because to do nothing would be worse," more people will get scared, remain scared, and eventually begin to believe it. Think of it as a Patriot Act for Democrats.

The Democratic president disparages the Bush tax cuts, one of his predecessor’s finest measures, because the national debt skyrocketed and our nation’s financial institutions crumbled during the final months of the lame duck administration. In other words, the new president is trying to tell us that the economy is teetering toward collapse because Americans were allowed to have more money in their paycheck, and nothing to do with the ridiculous spending spree President Bush and the Republicans went on. President Obama’s prescription for economic recovery seems to be, don’t cut taxes, but go on a ridiculous spending spree. President Bush’s problem was not that he cut taxes, but that he cut taxes, and then did not begin reducing the size of the government to compensate for the lost revenue. President Obama wants to leave taxes where they are, for the time-being it would seem, and then increase the size of the federal government.

Now that the Democratic-bashing portion of the blog is through, let us move on to the Democrats’ henchmen.

What should be more surprising, but that I fear is not, is that the Republicans are willing co-participants in this mad spending scheme as well.

How? you might say, didn’t every House Republican vote against the stimulus bill as it appeared in the House of Representatives? Yes, but every House Republican voted against a massive spending bill that could have caused revolts among their constituents had they voted for it, and every House Republican voted against a massive spending bill that did not need any of their votes.

The Democrats have such a strong majority in the House that they got the bill passed without any Republicans. By voting against the bill out of pure political expediency, they avoided the heat from their home districts. While many Republican cheerleaders on talk radio praised the Republicans and suggested that they might be returning to their fiscal principles, their votes meant nothing because the bill still passed.

By having nothing to lose by doing so, they voted against it. We still need time to see if the Republicans have made a prodigal journey back to fiscal sanity.

But what really made me reach for the Tums is what the party’s senators began attempting once the package reached their chamber.

When Democrats first suggested a $300 billion stimulus package, the Republicans gave the nod to them and then some: they said $445 billion would be just fine.

Republican senators want to give tax credits to homeowners since the housing market bubble has utterly popped. A tax credit, which sounds like it might be good, is really just another manifestation of welfare. Whereas a tax cut in the form of George W. Bush or Ronald Reagan, allows the taxpayer to keep more of their income in their paycheck, a tax credit is a check from the federal government, with money that was printed from out of nowhere.

We can honestly say that we have a bipartisan government.

President Obama, during his never-ending campaign, said that he would bring Americans together and help heal our partisan wounds. Well, all that has happened since he took office is bring Republicans and Democrats together in a massive feast of pork. The parties are fighting over how much money should be in these stimulus packages and that should sound off alarms to conscientious citizens.

The only debate occurring over the spending bills are regarding how much should be spent and on what. There is no debate regarding whether so much money should be spent in the first place.

People seem to have forgotten that one short year ago, President Bush introduced a stimulus package to help boost a slumping economy. The stimulus did nothing to stop the collapse and nationalization of Fannie Mae, Freddie Mac, and Lehman Brothers. President Bush’s massive spending bill did nothing to stop the impending economic disaster. President Obama’s massive spending bill is even more massive and will only exacerbate the problem and ultimately cause more suffering for reasons already illuminated.

My prescription for the economy is to actually do very little. The current system cannot fix the disaster. It has been the invasive bipartisan federal government of this country that has caused this disaster.

Another appealing solution is to simply eliminate the Federal Reserve, that corrupt printer of bad money, which is the topic of Thomas E. Woods’ forthcoming book, Meltdown, A Free Market Look at Why the Stock Market Collapsed, the Economy Tanked, and Government Bailouts will Make Things Worse.

Let this prescription for the horrific levels of spending and bad money be quick and to the point: Stop It!

Dubya's Swan Song

Now in the final hours of his administration, President George W. Bush seems to be receiving some final well-wishes, even from many of his harshest critics while his few remaining supporters seem intent on supporting him blindly while seemingly refusing to acknowledge his deficiencies. So ends the odd and sometimes insuffrable Bush years.

The failure of the administration of the 43rd president is not that he invaded Iraq, was apparently asleep at the wheel when Hurricane Katrina hit, sided with Ted Kennedy on education and immigration, flubbed his initial Supreme Court choice of Harriet Miers, or grew government at LBJ speeds. It was all of this that derailed him. It was the liberalism of the first Republican president of the 21st century that caused his failure.

The conservatism embodied in Barry Goldwater and Ronald Reagan died during the past eight years. It was not merely that the president was liberal when we thought he was conservative, but he had legions of followers on the Right who followed him too blindly. After an election where conservatives and Republicans bemoaned the cult of personality surrounding our incoming president, we should be reminded that an idol was made out of the most recent occupant of the office. Conservatives followed a failed president off the cliff. The wreckage lies at the bottom.

Despite all that, even his biggest mistake, Iraq, is not uniquely Mr. Bush’s fault. His enablers came from both parties. Democrats and Republicans to this day continue to funnel American tax dollars into a Middle Eastern black hole.

Many people (yes, liberals) desired to see Saddam Hussein deposed but only when a humanitarian war went south did they begin to denounce it. The war of national security to remove weapons of mass destruction, that likely existed at one time, became a war of ideology (democracy) and a clash of civilizations. I have stubbornly clung to the belief that the President did not lie in making his case to the nation about the war with Iraq (in fact, I have far more contempt for the neoconservative advisors who, like they did for many others, duped the president about the threat of Hussein‘s Iraq), but regret his refusal to correct an obvious mistake.

Some of the remaining supporters of the president are taking these final hours to harangue his critics who gave him nothing but grief from the very beginning. External obstacles, by and large, did not ruin the presidency of Mr. Bush. It was mainly the ones he set for himself: Iraq, the bureaucratic nightmare of Katrina, his incompetent presiding over a corrupt party, that is what made George W. Bush a failed president and a tragic historical figure.

There is little doubt that George W. Bush’s time in office will be judged by his decision to go to war in Iraq. He will be fortunate if the economy turns around and the recession manages to avoid becoming a depression as the plummeting economy is considered by many to be the final tragic legacy Mr. Bush is leaving to his country.

It was his liberalism that ruined the president’s two terms. Even though Mr. Bush’s successor promises to be different, he appears poised to keep doing more of the same. Instead of Iraq, Mr. Obama will ratchet up the American presence in Afghanistan, a country perhaps impossible to pacify, that could ruin his presidency as the former country ruined Mr. Bush’s. The government grew at an alarming rate under this Republican president and the incoming Democratic president, with stronger majorities than his predecessor ever had, is prepared to explode the government to new and more invasive depths. Did we really learn nothing from the Bush years?

These last few days have filled me with regret. It serves little purpose now to get angry with George W. Bush. After all that has happened over the past eight years, I feel a little sorry for him. Yes, he has been a failed president, but his failure was not inevitable. If he had kept his 2000 campaign pledge of a humble foreign policy and kept his promise to get government out of the people’s way, he would have avoided some of these massive disasters.

Alas, it was not. History is not written by what could have been or what should have been, but what was, and the 43rd president was as an abject failure. Mr. Bush leaves the White House tomorrow and returns home to Texas, which is a site I believe everyone, including the president himself, is happy to see.

Goodbye, Mr. President.

Screwed coming and going

The events of the last two weeks, ie. the recent Wall Street crisis and impending $700 billion bailout, clearly demonstrates why each of the nominees and their parties are unfit to lead. John McCain suspended his presidential campaign to return to Washington last week in order to address the fiscal crisis that will result in the nationalization of our country’s banking system. After doing nothing and coming off as brutish in the debate, Mr. McCain proved himself inept. Continuing to shirk his senatorial responsibilities, the only contribution to the situation from the freshman senator of Illinois was an aloof, “Call me if you need me.” Now tell me, do you have the Messiah on speed-dial?

As last Friday’s debate approached, observers believed it was going to be exclusively about foreign policy. Not that I looked forward to 90 minutes of Senator McCain’s saber-rattling, but about half of it was dedicated to the financial mess and what each bonehead would do. It told us precisely why neither candidate should win. John McCain used the time to take a few new positions on the bailout, while it was the opportunity for Mr. Obama to tell the country that there isn’t a federal regulation he doesn’t like. (Lending institutions are bankrupt? Let the government take care of it! Public schools don’t teach enough sex ed? Let the government take care of it! Can‘t say anything nice about Barack Obama? Well, the government can take care of that - and you - too) One candidate promises intervention into the economy of our country while one candidate promises military intervention into other countries. Is there anyone still alive who remembers when the United States was a free country?

Regarding the financial debacle, Republicans point at Democrats while Democrats blame the Bush economic policies that (in their minds) forced banks to lend out money they didn’t have. It would be comical if not so tragic that the most irrelevant House speaker of all time, Nancy Pelosi, continually asserts that Democrats bear no blame for the bad money policies that are biting the country on the back side. As bad as the Republicans were, especially during the first six years of the Bush administration, it was the Democrats who promised in 2006 that they would end Mr. Bush’s atrocious war in Iraq and end Washington’s “culture of corruption.” Little did anyone know that it was only the corruptive majority party that would change. As for the economy, the Democrats blame the upcoming depression on the president “because it happened on his watch.”

That would seem a pretty damning charge, but Democrats Chris Dodd of Connecticut and Barney Frank of Massachusetts, who each head committees on banking, have each received generous amounts of money from Fannie Mae and Freddie Mac. Despite receiving warnings, the two corrupt politicians continually claimed that the institutions were stable and intact. Considering what we know now, then we should probably assume that because the Democrats were the controlling party of the whole legislative branch, then they are also responsible. They were the ones truly just watching as the economy collapsed. The absurd $700 billion bailout serves only to save their own butts and the butts of their partners in crime. If knowingly lending out unsupported money to unsuspecting people is not a crime, then I guess neither is waging an aggressive, undeclared war against a country that never attacked us. Just a little something for Democrats to chew on.

Barack Obama can probably coast to the White House now. Before the primaries, John McCain infamously said that he did not understand much about the economy. He spent the past week proving it (somewhere Mitt Romney and Mike Huckabee and probably sobbing). Barack Obama demonstrates more competence in talking about economics, regardless of whether the content he knows will be useful for taxpayers. People will be more willing to trust him to handle money matters.

Even after eight relatively good years, the American masses tend to tire of the incumbent party. While Ronald Reagan was not quite as spectacularly loved during the 1980s and Republicans gloat, his general popularity did not immediately benefit Vice President George H. W. Bush. And despite Bill Clinton’s little impeachment problem, his enormous popularity did little to help Al Gore. In 2000, George W. Bush and the Republicans tied Mr. Gore to Mr. Clinton, despite the latter’s popularity. Even though George W. Bush’s popularity probably does not need to be reiterated here, it helps to show how the GOP nominee, whoever it would be, was in for an uphill struggle. The incumbent party is always bound to face trouble after eight years in the White House. Incompetence and corruption would only compound the situation, paving the way for the opposition party.

So, what to do? My unsolicited opinion is to reject all faith in the two governing parties. This not-so-unexpected calamity regarding the nation’s economy, readily pointed out by Ron Paul, tells this writer everything necessary to decide that neither the Republicans nor the Democrats have the will nor desire to actually fix anything. Both parties stood by and watched as their mess came to fruition. John McCain’s ignorance and incompetence disqualify him from serving as president, with his age being the least of his problems. Barack Obama, who only intends to inject more fake money into the economy, somehow fund universal health care, raise taxes, and refuse to end a war that will soon be in its sixth unpopular year, will probably make taxpayers yearn for the good olds of George W. Bush.

Maybe the Alaska Independence Party in on to something.

Soon: Palin. What Happened?