We are trying to recover from a debt driven bubble, and Americans are cleaning up their personal debt. The problem is the government is borrowing 700% more than people are paying off. Makes you wonder why you should even get your house in order, when the government is mortgaging our futures away.

For every dollar in debt that Americans have paid off since they started cleansing their balance sheets in mid-2008, the U.S. government has borrowed more than $7. All the hard work by consumers to replenish their piggy banks may be for naught if big government budget deficits play havoc with the economy.

Last week’s federal budget didn’t provide much solace. The Obama administration projected that the federal debt could double over the next decade, prompting Moody’s Investors Service to warn that the pristine AAA credit rating of the U.S. “could come under downward pressure.”

Investors need to account for the burgeoning federal budget deficit as they save for retirement, college tuition or homes. Uncle Sam’s borrowing binge could set off a surge in inflation and push down the dollar, both of which would erode the value of savings. It could also push interest rates higher, hammering the value of the more than $1 trillion in Treasury bonds owned by households directly or through mutual funds. Income taxes, already set to rise, might have to climb further to help close the government’s budget gap.

The result could be what Laurence Siegel, director of the Research Foundation of the CFA Institute, calls a “triple whammy” of weak economic growth, higher inflation and higher tax bills. Inflation itself is a kind of tax; by driving up prices of assets like stocks and real estate, it triggers bigger capital-gains tax bills even when the assets barely keep pace with the higher cost of living.

via Protecting Yourself From the Giant New Deficit – WSJ.com.

Lewrockwell.com has a fascinating post today (actually a chapter from a book) about how the market could better handle defense from foreign agression than government. As I said in my post the other day, defense whether domestic with police or foreign with military, can be defended as a government role, because government’s role is supposed to be defending individual liberty and protecting us from coercion.

While I think it is hard for most people to believe that the free market can provide policing and military defence (even I questioned military), this post makes a great argument for the free market. As I was reading, lights were going off in my head as to downfalls of government defense and the benefits to the people of it being handled in the free market. Here are some highlights. I highly recommend reading the entire post. Whether you agree or disagree, it is fascinating.

Many people ask, “But how in the world could a laissez-faire society deal with aggression by foreign nations, since it would have no government to protect it?” Behind this question are two unrealized assumptions: first, that government is some sort of extra-societal entity with resources of its own – resources which can only be tapped for defense by the action of government – and, second, that government does, in fact, defend its citizens.

In reality, government must draw all its resources from the society over which it rules. When a governmentally controlled society takes defensive action against an aggression by a foreign power, where does it get the resources necessary to take that action? The men who fight are private individuals, usually conscripted into government service. The armaments are produced by private individuals working at their jobs. The money to pay for these armaments and the pittance doled out to the conscripts, as well as the money to pay the salaries of that small minority comprising the other members of the armed forces, is confiscated from private individuals by means of taxation.

Government’s only contribution is to organize the whole effort by the use of force – the force of the draft, taxation, and other, more minor coercions, such as rationing, wage and price ceilings, travel restrictions, etc. So, to maintain that government is necessary to defend a society from foreign aggression is to maintain that it is necessary to use domestic aggression against the citizens in order to protect them from foreign aggression.

In spite of the obvious immorality of forcing men to protect themselves against force, some people still maintain that a coerced defense is more efficient than a willing one and is, therefore, permissible or even necessary in an emergency situation such as war. A brief examination will show the fallacy of this variation of the moral/practical dichotomy.

The success of any endeavor, including war, depends on the amount of thought and effort put into it by those involved. Under the pressure of force, a man may be induced to put forth a great deal of effort and even a little thought, but his reluctant, fear-driven exertions can’t compare in efficiency and productivity with the ambitious and tireless efforts of a free man striving to accomplish something he really wants to get done. The man who works enthusiastically not only works more efficiently, he also uses his mind to discover new and better ways of reaching the goal, and such innovation is the key to success.

Furthermore, a system of force is always wasteful of resources, because the more unwilling is the victim of the force, the more energy must be diverted to keeping him in line and the less is left to accomplish the task. Men who are forced to do what they don’t want to (or not to do what they do want to) are amazingly good at devising devious and complicated ways to cheat on the system which enslaves them. This is why even the most totalitarian of governments find that they cannot wage war without huge propaganda efforts aimed at convincing their own people of the justice and necessity of the war.

Throughout history, people have been talked into submitting to the tyrannies of their governments because, they were told, their government was vitally necessary to protect them from the even more terrible depredations of other governments. The governments, having put over this bit of propaganda, then proceeded to cajole and coerce their citizens into protecting them!

Governments never defend their citizens; they can’t. What they do is make the citizens defend them, usually after their stupid and imperialistic policies have aggravated or threatened another government to the point of armed conflict. Governmental protection against foreign aggression is a myth (but a myth which, sad to say, most people actually believe in).

Government can’t defend its citizens, and it is foolish and sacrificial for the citizens to defend a coercive monopoly which not only enslaves them but makes a practice of provoking conflicts with other coercive monopolies – i.e., with other governments.

Morally, no man may be prevented from defending himself and his values, nor may he be forced to defend them if he doesn’t want to do so.

If some of the people in an area feel that one of their neighbors is not “carrying his fair share of the defense burden,” they are free to use rational persuasion to attempt to convince him that it would be in his interest to assume his own responsibility of self-defense. They may not, however, extort his compliance by any use or threat of force…even if they are clearly in the majority. Nor would it be practical for them to do so. A man who is coerced into defending his neighbors against a foreign aggressor may decide to spend part of his efforts on defending himself against his coercive neighbors instead.

In a laissez-faire society, defense against foreign aggression would be offered for sale on the free market, just as would any other type of defense. Because of the close natural connection between insurance companies and defense agencies, it would probably be most feasible to sell defense against foreign aggression in the form of insurance policies. That is, insurance companies would sell policies agreeing to protect their insureds against foreign aggression and to indemnify them for losses resulting from such aggression (the contract to be void, of course, if the insured provoked the conflict by his own aggressive actions). The insurance companies would see to it that whatever defenses were necessary to prevent the losses were provided, and they would make sure that a very efficient job of defense was done, since any losses would cost them large sums of money.

A major portion of the cost of defense against foreign aggression in a laissez-faire society would be borne originally by business and industry, as owners of industrial plants obviously have a much greater investment to defend than do owners of little houses in suburbia. If there were any real threat of aggression by a foreign power, businessmen would all be strongly motivated to buy insurance against that aggression, for the same reason that they buy fire insurance, even though they could save money in the short run by not doing so.

An interesting result of this fact is that the cost of defense would ultimately tend to be spread among the whole population, since defense costs, along with overhead and other such costs, would have to be included in the prices paid for goods by consumers. So, the concern that “free riders” might get along without paying for their own defense by parasitically depending on the defenses paid for by their neighbors is groundless. It is based on a misconception of how the free-market system would operate.

Foreign Aggression by Morris and Linda Tannehill.

The one part that really struck out at me was paying for defense like an insurance policy. As I stated the other day, insurance companies could provide fire services to their subscribers instead of having it handled through government and taxation. Insurance companies have the incentive to minimize their outlays, so they will are motivated to get fires are put out quickly and make steps to minimize the chances of having fires. The less fires they have, the higher their profits. On the other hand, the more fires (or other services delegated to a fire dept.) the bigger the department comes, and the bigger their budgets become. This is the goal of a government organization. Anyways, they explained how insurance could address defense in a similar manner.

While insurance companies have been demonized in our media and government, they provide valuable services when government isn’t involved. I don’t hear too many people complaining about their evil life and home owner insurance companies. Instead they complain about health insurance companies who are heavily regulated and where government accounts for 50% of all expenditures.

While I haven’t worked through all the details of whether I think this could work or not, here are some of the first thoughts that came to mind when I read this:

1. Insurance companies would not want war. It would cost them too much money. Since their contract is to defend their client, they would pursue diplomacy better than a government would who gets more money and control if there is a war.

2. Insurance companies in looking to reduce the chances of expensive reconstruction costs, would invest heavily in defensive measures that would dissuade agression. Instead of going out looking for dragons to slay, they would do what the people(clients) want, which is to be defended only. Most people do not want their government going out starting wars.

3. While the defense agencies might be incentized to have wars in order to grow, insurance companies, who would be the client or owner of the defense agency has the exact opposite incentive. Because of that, the insurance company would keep the defense agency in check. If the defense agency was stirring up trouble in order to get more business, they would lose the largest clients, insurance companies. Instead their incentive would be to develop lower cost technologies and to become more efficient. That would increase their profits without the need for increased warfare.

Again, this is just off the top of my head as I’m reading this myself, so I may be missing some incentives and some possible downfalls. I’d love to hear thoughts from everyone else.

Our government, the same idiots liberals look to for health care and the same idiots neocons look to for protection from overseas boogeymen, has looted and spent our way into what is going to be the beginning of the end.

Last month, we noted that Social Security had delivered its worst performance in decades. Now, Allen Sloan warns investors at Yahoo Finance that the entire program has gone into the red — and will stay there. Get ready, Sloan says, for the mother of all bailouts:

Don’t look now. But even as the bank bailout is winding down, another huge bailout is starting, this time for the Social Security system.

A report from the Congressional Budget Office shows that for the first time in 25 years, Social Security is taking in less in taxes than it is spending on benefits.

Instead of helping to finance the rest of the government, as it has done for decades, our nation’s biggest social program needs help from the Treasury to keep benefit checks from bouncing — in other words, a taxpayer bailout.

via Hot Air » Blog Archive » Social Security tipping over into the red.

So, how are these morons going to attemp to get us back to solvency? Will they have the guts to cut back social security or abolish it all together? (that was rhetorical) My guess is this will be the beginning of what Peter Schiff calls the coming currency crisis. They will attempt to print their way out of it, which will send the dollar falling, hurting those on social security and everyone as a whole.

Better stock up on food, cigarettes, and bullets. They’ll be great for bartering.

This morning I was checking RT.com’s Youtube videos, and I saw that the Pentagon now is going to combat global warming. I guess this will be the “War on Climate Change” now. This is why Republicans are making a huge mistake when they think no military can be too big, not military budget can be too big, and no military policy can be a bad one.

Maybe Obama will now say to conservatives, “You don’t support the troops.”, when conservatives question money being wasted on a fake crisis. Believe me I used to think the same things when I was pro-war. I now realize that all government, whether domestic or military is looking to do one thing. That is to grow and gain more power. Like terrorism, global warming is the perfect boogeyman. This time they have the boogeyman for the left.

President Obama is hurrying to create military climate change command, apparently planning to spend a big chunk of increasingly scarce Defense Department funds on monitoring global warming. Obama and the Democratic Congress are setting the stage to focus the Pentagon on doomsday environmentalism.

via YouTube – RussiaToday’s Channel.

Update: I guess now that more proof is piling up that scientists have been manipulating data for 20 years, Obama is just going to use military to force global warming on us.

http://www.youtube.com/watch?v=QwLL2Cjfed8

Why is anyone shocked by this? It’s always different for the rulers. They can steal, lie, commit fraud, create ponzi schemes, counterfeit money and basically every other crime you can think of, but they do not want citizens to be able to have something as basic as self defense.

Long time Anti-Gun Advocate State Senator R.C. Soles, 74, shot one of two intruders at his home just outside Tabor City, N.C. about 5 p.m. Sunday, the prosecutor for the politician’s home county said.

The intruder, Kyle Blackburn, was taken to a South Carolina hospital, but the injuries were not reported to be life-threatening, according to Rex Gore, district attorney for Columbus, Bladen and Brunswick counties.

The State Bureau of Investigation and Columbus County Sheriff ‘s Department are investigating the shooting, Gore said. Soles, who was not arrested,declined to discuss the incident Sunday evening.

“I am not in a position to talk to you,” Soles said by telephone. “I’m right in the middle of an investigation.”

The Senator, who has made a career of being against gun ownership for the general public, didn’t hesitate to defend himself with his own gun when he believed he was in immediate danger and he was the victim.

via Chuck on the Right Side: Anti-Gun Senator Shoots Intruder.

Just when you think the tea parties are having an effect, the Republican establishment shows how stupid they are.

Republicans are stepping up their campaign to win donations from Wall Street, trying to capitalize on an increasing sense of regret among executives at big financial institutions for backing Democrats in 2008.

In discussions with Wall Street executives, Republicans are striving to make the case that they are banks’ best hope of preventing President Barack Obama and congressional Democrats from cracking down on Wall Street.

GOP strategists hope to benefit from the reaction to the White House’s populist rhetoric and proposals, which range from sharp critiques of bonuses to a tax on big Wall Street banks, caps on executive pay and curbs on business practices deemed too risky.

Democrats have dominated Wall Street’s fund-raising circles in recent elections. Mr. Obama himself raised millions of dollars from employees of Goldman Sachs Group Inc., Citigroup Inc., J.P. Morgan Chase & Co. and other Wall Street firms.

Now, at least some Wall Street executives have reduced their political contributions to the Democratic Party and its candidates, according to fund-raising reports and interviews with executives at financial-services firms.

Last week, House Minority Leader John Boehner of Ohio made a pitch to Democratic contributor James Dimon, the chairman and chief executive of J.P. Morgan, over drinks at a Capitol Hill restaurant, according to people familiar with the matter.

Mr. Boehner told Mr. Dimon congressional Republicans had stood up to Mr. Obama’s efforts to curb pay and impose new regulations. The Republican leader also said he was disappointed many on Wall Street continue to donate their money to Democrats, according to the people familiar with the matter.

via Republicans Chase Wall Street Donors – WSJ.com.

Isn’t democracy grand? We have slime balls on all sides being controlled by Wall Street all the while plotting how they can deceive the average voter that they are trying to protect them. Obama’s White House is full of Wall Street insiders, so to believe they are going to hold Wall Street accountable is just silly. All that needs done to hold them accountable is allow them to fail.

Republicans are just asking to lose their momentum. They should not be begging Wall Street to allow them to be their laptop dogs. They should not be calling for caps on pay. They should be calling for the government to get out of the economy and out of the bailout business.

While I like Sarah Palin, I question whether she truly believes in a limited government. I think over the next couple years, her quality as a candidate will depend on who influences her ideas. She just recently backed Rand Paul, who is a limited government constitutionalist. Let’s hope the likes of Rand Paul have a lot of influence over her ideas.

In the meantime, she is no Debra Medina.

YouTube – RED WHITE AND BLUE: “Debra Medina, Candidate for Texas Governor”.

It seems like every time someone is defending socialism they say we already have socialism, and they bring up police, fire, roads, and schools. Now, those of you who follow my blog, know my opinion on schools.  Schools are a horrible example, if your goal is to preach the greatness of government or socialism. Of course, trying to argue against police, fire and roads is not an easy task. But hey, what’s the point of easy arguments, right?

So first, let me ask why these are considered socialist programs? They are not a redistribution of wealth? They are more like insurance for inhabitants of a neighborhood, at least the police and fire departments are. Those inhabitants pay in the form of property taxes, income taxes, sale tax, or however they chose to fund these insurance policies. Those who pay the most for them, property owners, are the ones who benefit the most from them. They protect property (supposed to anyway). Also, as far as roads go, as a neighborhood, state and country, we as citizens want to be able to get places. We want to get to the store, our family members’ houses, vacation spots, etc. We want the police and fire departments to be able to get to our house in an emergency. In order to have roads, we pay the government to make roads. Again, this is not as socialist as say welfare, universal health care, etc.

With that being said, even if these are sort of socialized, does that mean they are better than they could be if they were privatized? How about if they were never a government function in the first place? The problem is most people cannot imagine the world beyond what is constructed around them. The government steps in and takes over what the private sector used to deliver. Then when people say the government should shrink or go away, the sheeple say “yeah, but who’s going to do this, that, or the other thing.” Just imagine if you told a welfare recipient that we need to take our government back to the size talked about in the constitution. They’d say “Yeah, but who’s going to give me money to spend? Who’s going to give me my groceries?” They have forgotten that a job will give you those things.

Now, I really don’t want to get into each one of these in detail. When you bring up topics like this, people want to hammer you with questions about how you would fix some aspect of our society that they believe the government is fixing, but really the government is not. They say things like, yeah but in a free market, you’d have the ultra rich taking advantage of the rest of us, robbing us of our money. Meanwhile, under our government, the ultra rich already do that by government force. What do you think TARP, bailouts, Fed induced inflation, etc is? In the free market, at least you have a choice. The gun of government is not pointed at your head forcing your to hand you money over.

I myself cannot construct a complete system for police, fire and roads. If I could, then we should crown me King of the land, and shower me with gold. What I have done, after not believing these were possible without government, is try to think of possible ways these services could have been provided by the private sector had government no imposed it’s limited view on us. Let’s just go through some thoughts.

Police - To start, the more we force citizens to give up arms, the more police we need. An armed citizen can prevent crimes, can protect his family, and can protect his neighbors. Re-arm citizens and the need for police is greatly reduced. If everyone had a gun, do you think people would be more polite, less inclined to be violent, and commit less crime? Would they risk getting shot, since any person around them could and probably is packing?  In addition to a well armed citizenry, who is to say without government, we couldn’t have private defense agencies. With private defense agencies, there would be competition. In order to gain new customers, agencies would have to compete on price and track record. If one agency has customers being robbed, they’d lose business. If privatizing is just too hard to imagine, one could argue, that the main point of government is to secure our liberties. Since that is the case, policing does have a role in society. Then again, if we can secure our liberties without government, there would be no need for government.

Fire - This is one that socialists love to bring up. Let’s just think if we had no fire departments. Is it possible that they would come about without government force? To start, you could have companies delivering these services. You could have the exact same setup, but they could just be funded differently. It would seem to me that insurance companies could pay private fire companies a fee per insured house in a given area. This would help minimize the insurance company’s exposure. With private fire companies, you would have competition, competing on how fast they got to the fire, how contained the fire was, how much damage did the fire create, whats the cost per household for their services, and who has the best technology to fight fires.

Also, who is to say there wouldn’t be better technology if government didn’t force a certain system on society and spread the cost out amongst everyone. Maybe building materials would be much more fire retardant. If you want a certain insurance rate, you must use fire retardant materials or you must retrofit your house with some fire proofing technology. The innovation of the free market is hard to imagine, but that is because our minds are limited by the government imposed system. I’m sure many people could not have thought up some of the technologies we use in everyday life just ten years ago, but those technologies have not been suppressed by government imposed systems.

Roads - Aaaahhh, roads, what socialists believe is a modern marvel, because it creates public works. Are roads really that hard to imagine without government? Did the government invent roads? Did they not exist prior to government stealing our money to pay for them? Roads may seem hard to privatize, because they are massive. The problem is government is so ineffective, it’s hard to imagine that the roads developed by government are even efficient. They sure are not cost effective. We all have seen the group of men standing around watching just one man work. I’m sure there are many political handouts involved in roads. I can just imagine land speculation is a big thing for well connected people. They probably buy up land knowing that their political friends are going to buy it back for their new road project. Anyway, why would roads not be built if government ceased to exist tomorrow? Would we all just sit in our houses mourning over the lost of our oppressive government? I doubt it, and if there is demand for a means of travel, then their will be solutions. Again, who is to say roads are the way to go? Maybe to avoid the expensive building of roads, private innovators would have developed new traveling technology? Maybe you would have your car from “Back to the Future”. Surely, if the money was not taken out of private hands for the $400 billion road bills, that money would have been better utilized to innovate. OK, OK, I know it’s hard to imagine anything beyond our current view. So, let’s just say roads are here to stay. Who is to say they wouldn’t be built? I would think developers, if they wanted paid to develop, would build roads. If you are developing a plan of homes, don’t people need to get to those homes? If you are building a shopping plaza, don’t you want people to get to the stores? If you want people to get to your plant, office building, etc don’t you need a way for them to get there? Businesses would pay for road development. It is as simple as that. They would make sure the roads they developed were low cost and efficient. That is how the private sector works. Road projects would be steered to those who are the best at building low cost, efficient roads, because it would be paid for right out of the pockets of a developer. His profitability is effected by it.

Ok, this post is getting a little long. I just wanted to throw some thoughts up on this topic, because it’s a favorite of the statist. I myself used to think these things were in the realm of government, but someone on Mises.org’s forums asked me do I think government is more efficient or less efficient than the private sector. With that one question, I had my answer. Government is always less efficient. It does not matter what statists try to pitch. It cannot be efficient, because it requires a gun to your head to impose its vision. Efficiency does not require a gun. Efficiency is chosen freely by citizens looking to get the most out of their labors.

Hopefully, this got you thinking. I’d love to hear some ideas on how others think these services can be delivered.

As a former Neo-con, I used to love our fighting technology. What better advantage can you have than killing the enemy from miles away from the safety of some compound.

The problem with this is it makes the enemy’s life cheaper, and it makes it more likely you’ll instigate wars. If you are weighing whether to go to war and you know you can kill the other side without your own troops being harmed, do you think that will make you less likely or more likely to wage more wars?

Also, using robots, drones, etc, makes us think that the other side isn’t human. It’s like playing a video game. The problem is the other side is human. While terrorists should be killed, we cannot ignore collateral damage. Do you think the children of a mother accidentally killed by a drone will forgive the US for their mothers death? Will they grow up to be future terrorists in hopes of avenging their mothers death? Keep in mind the only difference between us and them is our respective governments. Chances are if peoples of both sides met on the streets as individuals, we’d say hello, excuse me and be polite. It’s only the belligerence of our governments that make us enemies.

So, back to the robots. Do they make us safer? Maybe in the short run they keep our soldiers safe, but what happens when a possible enemy creates the same technology? All the sudden our compounds are not as safe. Maybe they use robots to infiltrate our compounds, where our soldiers are controlling their robots. Not only that, what happens if terrorists get their hands on robotic terror? How much easier would it be to wage holy war with robots?

While I love technology (I work in the technology field), I think we hasten war and destruction by using technology to take life. Nothing makes you consider the cost of life in war as much as a higher chance of losing yours. We should use technology to create better defenses and for protecting life. We should pause when it comes to aggressive, life cheapening technology. While it may makes billions for defense contractors, in the long run, it poses a major threat to the people of our country. Never forget, these technologies would also be the weapons used against citizens if they ever tried rising up against an oppressive government.

YouTube – Army of the Future: Russian combat Robots.