HERE'S A GREAT VISUALIZATION ON THE AMERICAN DEBT!

I DARE ANY LIBERAL PROGRESSIVE TO DENY THAT OBAMA HAS MADE THIS PROBLEM WORSE BY HIS LAME-BRAINED POLICIES OVER THE LAST 2 1/2 YEARS. BLAME BUSH ALL YOU WANT [For his part of it], OBAMA HASN'T HAD ANY HELP DOING WHAT HE'S DONE. THE TOTAL BLAME NOW IS HIS! HERE END'TH THE LESSON: GO HERE TO LEARN THE TRUTH ABOUT OUR DEBT AS NOTHING YOU'VE SEEN BEFORE! http://www.wtfnoway.com/

A Patriot's History Of The Modern World!

This National Debt is not exceptible! It is plainly "Generational Stealing"

BOTH PARTIES MADE THIS MESS...AND BOTH PARTIES MUST CLEAN IT UP!

Issues that matter

Monday, December 5, 2011

PART 11 - Economics In One Lesson By HENRY HAZLITT

PART 11WHO'S "PROTECTED" BY TARIFFS?

A mere recital of the economic policies of governments all over the world is calculated to cause any serious student of economics to throw up his hands in despair. What possible point can there be, he is likely to ask, in discussing refinements and advances in economic theory, when popular thought and the actual policies of governments, certainly in everything connected with international relations, have not yet caught up with Adam Smith? For present-day tariff and trade policies are not only as bad as those in the seventeenth and eighteenth centuries, but incomparably worse. The real reasons for those tariffs and other trade barriers are the same, and the pretended reasons are also the same.

In the century and three-quarters since The Wealth of Nations appeared, the case for free trade has been stated thousands of times, but perhaps never with more direct simplicity and force than it was stated in that volume. In general Smith rested his case on one fundamental proposition: "In every country it always is and must be the interest of the great body of the people to buy whatever they want of those who sell it cheapest." "The proposition is so very manifest," Smith continued, "that it seems ridiculous to take any pains to prove it; nor could it ever have been called in question, had not the interested sophistry of merchants and manufacturers confounded the common sense of mankind."

From another point of view, free trade was considered as one aspect of the specialization of labor:

It is the maxim of every prudent master of a family, never to attempt to make at home what it will cost him more to make than to buy. The tailor does not attempt to make his own shoes, but buys them of the shoe maker. The shoemaker does not attempt to make his own clothes, but employs a tailor. The farmer attempts to make neither the one nor the other, but employs those different artificers. All of them find it for their interest to employ their whole industry in a way in which they have some advantage over their neighbors, and to purchase with a part of its produce, or what is the same thing, with the price of a part of it, whatever else they have occasion for. What is prudence in the conduct of every private family can scarce be folly in that of a great kingdom.



But whatever led people to suppose that what was prudence in the conduct of every private family could be folly in that of a great kingdom? It was a whole network of fallacies, out of which mankind has still been unable to cut its way. And the chief of them was the central fallacy with which this book is concerned. It was that of considering merely the immediate effects of a tariff on special groups, and neglecting to consider its long-run effects on the whole community.


An American manufacturer of woolen sweaters goes to Congress or to the State Department and tells the committee or officials concerned that it would be a national disaster for them to remove or reduce the tariff on British sweaters. He now sells his sweaters for $15 each, but English manufacturers could sell their sweaters of the same quality for $10. A duty of $5, therefore, is needed to keep him in business. He is not thinking of himself, of course, but of the thousand men and women he employs, and of the people to whom their spending in turn gives employment. Throw them out of work, and you create unemployment and a fall in purchasing power, which would spread in ever-widening circles. And if he can prove that he really would be forced out of business if the tariff were removed or reduced, his argument against that action is regarded by Congress as conclusive.

But the fallacy comes from looking merely at this manufacturer and his employees, or merely at the American sweater industry. It comes from noticing only the results that are immediately seen, and neglecting the results that are not seen because they are prevented from coming into existence.

The lobbyists for tariff protection are continually putting forward arguments that are not factually correct. But let us assume that the facts in this case are precisely as the sweater manufacturer has stated them. Let us assume that a tariff of $5 a sweater is necessary for him to stay in business and provide employment at sweater-making for his workers.

We have deliberately chosen the most unfavorable example of any for the removal of a tariff. We have not taken an argument for the imposition of a new tariff in order to bring a new industry into existence, but an argument for the retention of a tariff that has already brought an industry into existence, and cannot be repealed without hurting somebody.

The tariff is repealed; the manufacturer goes out of business; a thousand workers are laid off; the particular tradesmen whom they patronized are hurt. This is the immediate result that is seen. But there are also results which, while much more difficult to trace, are no less immediate and no less real. For now sweaters that formerly cost $15 apiece can be bought for $10. Consumers can now buy the same quality of sweater for less money, or a much better one for the same money. If they buy the same quality of sweater, they not only get the sweater, but they have $5 left over, which they would not have had under the previous conditions, to buy something else. With the $10 that they pay for the imported sweater they help employment-as the American manufacturer no doubt predicted-in the sweater industry in England . With the $5 left over they help employment in any number of other industries in the United States .

But the results do not end there. By buying English sweaters they furnish the English with dollars to buy American goods here. This, in fact (if I may here disregard such complications as multilateral exchange, loans, credits, gold movements, etc. which do not alter the end result) is the only way in which the British can eventually make use of these dollars. Because we have permitted the British to sell more to us, they are now able to buy more from us.


They are, in fact, eventually forced to buy more from us if their dollar balances are not to remain perpetually unused. So, as a result of letting in more British goods, we must export more American goods. And though fewer people are now employed in the American sweater industry, more people are employed and much more efficiently employed-in, say, the American automobile or washing-machine business.


American employment on net balance has not gone down, but American and British production on net balance has gone up. Labor in each country is more fully employed in doing just those things that it does best, instead of being forced to do things that it does inefficiently or badly. Consumers in both countries are better off. They are able to buy what they want where they can get it cheapest. American consumers are better provided with sweaters, and British consumers are better provided with motor cars and washing machines.



Now let us look at the matter the other way round, and see the effect of imposing a tariff in the first place. Suppose that there had been no tariff on foreign knit goods, that Americans were accustomed to buying foreign sweaters without duty, and that the argument were then put forward that we could bring a sweater industry into existence by imposing a duty of $5 on sweaters.

There would be nothing logically wrong with this argument so far as it went. The cost of British sweaters to the American consumer might thereby be forced so high that American manufacturers would find it profitable to enter the sweater business. But American consumers would be forced to subsidize this industry. On every American sweater they bought they would be forced in effect to pay a tax of $5 which would be collected from them in a higher price by the new sweater industry.

Americans would be employed in a sweater industry who had not previously been employed in a sweater industry. That much is true. But there would be no net addition to the country's industry or the country's employment. Because the American consumer had to pay $5 more for the same quality of sweater he would have just that much less left over to buy anything else. He would have to reduce his expenditures by $5 somewhere else. In order that one industry might grow or come into existence, a hundred other industries would have to shrink. In order that 20,000 persons might be employed in a sweater industry, 20,000 fewer persons would be employed elsewhere.

But the new industry would be visible. The number of its employees, the capital invested in it, the market value of its product in terms of dollars, could be easily counted. The neighbors could see the sweater workers going to and from the factory every day.


The results would be palpable and direct. But the shrinkage of a hundred other industries, the loss of 20,000 other jobs somewhere else, would not be so easily noticed. It would be impossible for even the cleverest statistician to know precisely what the incidence of the loss of other jobs had been precisely how many men and women had been laid off from each particular industry, precisely how much business each particular industry had lost–because consumers had to pay more for their sweaters.


For a loss spread among all the other productive activities of the country would be comparatively minute for each. It would be impossible for anyone to know precisely how each consumer would have spent his extra $5 if he had been allowed to retain it. The overwhelming majority of the people, therefore, would probably suffer from the optical illusion that the new industry had cost us nothing.



It is important to notice that the new tariff on sweaters would not raise American wages. To be sure, it would enable Americans to work in the sweater industry at approximately the average level of American wages (for workers of their skill), instead of having to compete in that industry at the British level of wages. But there would be no increase of American wages in general as a result of the duty; for, as we have seen, there would be no net increase in the number of jobs provided, no net increase in the demand for goods, and no increase in labor productivity. Labor productivity would, in fact, be reduced as a result of the tariff.

And this brings us to the real effect of a tariff wall. It is not merely that all its visible gains are offset by less obvious but no less real losses. It results, in fact, in a net loss to the country. For contrary to centuries of interested propaganda and disinterested confusion, the tariff reduces the American level of wages. Let us observe more clearly how it does this.


We have seen that the added amount which consumers pay for a tariff-protected article leaves them just that much less with which to buy all other articles. There is here no net gain to industry as a whole. But as a result of the artificial barrier erected against foreign goods, American labor, capital and land are deflected from what they can do more efficiently to what they do less efficiently. Therefore, as a result of the tariff wall, the average productivity of American labor and capital is reduced.

If we look at it now from the consumer's point of view, we find that he can buy less with his money. Because he has to pay more for sweaters and other protected goods, he can buy less of everything else. The general purchasing power of his income has therefore been reduced. Whether the net effect of the tariff is to lower money wages or to raise money prices will depend upon the monetary policies that are followed. But what is clear is that the tariff-though it may increase wages above what they would have been in the protected industries-must on net balance, when all occupations are considered, reduce real wages.

Only minds corrupted by generations of misleading propaganda can regard this conclusion as paradoxical. What other result could we expect from a policy of deliberately using our resources of capital and manpower in less efficient ways than we know how to use them? What other result could we expect from deliberately erecting artificial obstacles to trade and transportation?

For the erection of tariff walls has the same effect as the erection of real walls. It is significant that the protectionists habitually use the language of warfare. They talk of "repelling an invasion" of foreign products. And the means they suggest in the fiscal field are like those of the battlefield. The tariff barriers that are put up to repel this invasion are like the tank traps, trenches and barbed-wire entanglements created to repel or slow down attempted invasion by a foreign army.

And just as the foreign army is compelled to employ more expensive means to surmount those obstacles bigger tanks, mine detectors, engineer corps to cut wires, ford streams and build bridges-so more expensive and efficient transportation means must be developed to surmount tariff obstacles.


On the one hand, we try to reduce the cost of transportation between England and America, or Canada and the United States, by developing faster and more efficient ships, better roads and bridges, better locomotives and motor trucks. On the other hand, we offset this investment in efficient transportation by a tariff that makes it commercially even more difficult to transport goods than it was before. We make it a dollar cheaper to ship the sweaters, and then increase the tariff by two dollars to prevent the sweaters from being shipped. By reducing the freight that can be profitably carried, we reduce the value of the investment in transport efficiency.

The tariff has been described as a means of benefiting the producer at the expense of the consumer. In a sense this is correct. Those who favor it think only of the interests of the producers immediately benefited by the particular duties involved. They forget the interests of the consumers who are immediately injured by being forced to pay these duties.


But it is wrong to think of the tariff issue as if it represented a conflict between the interests of producers as a unit against those of consumers as a unit. It is true that the tariff hurts all consumers as such. It is not true that it benefits all producers as such. On the contrary, as we have just seen, it helps the protected producers at the expense of all other American producers, and particularly of those who have a comparatively large potential export market.

We can perhaps make this last point clearer by an exaggerated example. Suppose we make our tariff wall so high that it becomes absolutely prohibitive, and no imports come in from the outside world at all. Suppose, as a result of this, that the price of sweaters in America goes up only $5. Then American consumers, because they have to pay $5 more for a sweater, will spend on the average five cents less in each of a hundred other American industries.


 (The figures are chosen merely to illustrate a principle: there will, of course, he no such symmetrical distribution of the loss; moreover, the sweater industry itself will doubtless he hurt because of protection of still other industries. But these complications may be put aside for the moment.)

Now because foreign industries will find their market in America totally cut off, they will get no dollar exchange, and therefore they will he unable to buy any American goods at all. As a result of this, American industries will suffer in direct proportion to the percentage of their sales previously made abroad. Those that will be most injured, in the first instance, will be such industries as raw cotton producers, copper producers, makers of sewing machines, agricultural machinery, typewriters and so on.

A higher tariff wall, which, however, is not prohibitive, will produce the same kind of results as this, hut merely to a smaller degree.

The effect of a tariff, therefore, is to change the structure of American production. It changes the number of occupations, the kind of occupations, and the relative size of one industry as compared with another. It makes the industries in which we are comparatively inefficient larger, and the industries in which we are comparatively efficient smaller. Its net effect, therefore, is to reduce American efficiency, as well as to reduce efficiency in the countries with which we would otherwise have traded more largely.

In the long run, notwithstanding the mountains of argument pro and con, a tariff is irrelevant to the question of employment. (True, sudden changes in the tariff, either upward or downward, can create temporary unemployment, as they force corresponding changes in the structure of production. Such sudden changes can even cause a depression.) But a tariff is not irrelevant to the question of wages. In the long run it always reduces real wages, because it reduces efficiency, production and wealth.

Thus all the chief tariff fallacies stem from the central fallacy with which this book is concerned. They are the result of looking only at the immediate effects of a single tariff rate on one group of producers, and forgetting the long-run effects both on consumers as a whole and on all other producers.

(I hear some reader asking: "Why not solve this by giving tariff protection to all producers?" But the fallacy here is that this cannot help producers uniformly, and cannot help at all domestic producers who already "outsell" foreign producers: these efficient producers must necessarily suffer from the diversion of purchasing power brought about by the tariff.)

On the subject of the tariff we must keep in mind one final precaution. It is the same precaution that we found necessary in examining the effects of machinery. It is useless to deny that a tariff does benefit–or at least can benefit-special interests. True, it benefits them at the expense of everyone else. But it does benefit them.


 If one industry alone could get protection, while its owners and workers enjoyed the benefits of free trade in everything else they bought, that industry would benefit, even on net balance. As an attempt is made to extend the tariff blessings, however, even people in the protected industries, both as producers and consumers, begin to suffer from other people's protection, and may finally he worse off even on net balance than if neither they nor anybody else had protection.

But we should not deny, as enthusiastic free traders have so often done, the possibility of these tariff benefits to special groups. We should not pretend, for example, that a reduction of the tariff would help everybody and hurt nobody. It is true that its reduction would help the country on net balance. But somebody would be hurt. Groups previously enjoying high protection would be hurt.

 That in fact is one reason why it is not good to bring such protected interests into existence in the first place. But clarity and candor of thinking compel us to see and acknowledge that some industries are right when they say that a removal of the tariff on their product would throw them out of business and throw their workers (at least temporarily) out of jobs. And if their workers have developed specialized skills, they may even suffer permanently, or until they have at long last learnt equal skills. In tracing the effects of tariffs, as in tracing the effects of machinery, we should endeavor to see all the chief effects, in both the short run and the long run, on all groups.

As a postscript to this chapter I should add that its argument is not directed against all tariffs, including duties collected mainly for revenue, or to keep alive industries needed for war; nor is it directed against all arguments for tariffs. It is merely directed against the fallacy that a tariff on net balance "provides employment," "raises wages," or "protects the American standard of living." It does none of these things; and so far as wages and the standard of living are concerned, it does the precise opposite. But an examination of duties imposed for other purposes would carry us beyond our present subject.

Nor need we here examine the effect of import quotas, exchange controls, bilateralism and other devices in reducing, diverting or preventing international trade. Such devices have, in general, the same effects as high or prohibitive tariffs, and often worse effects. They present more complicated issues, but their net results can be traced through the same kind of reasoning that we have just applied to tariff barriers.

Sunday, November 27, 2011

PART 10 - Economics in One Lesson by Henry Hazlitt

The Lesson Applied

The Fetish of Full Employment


THE ECONOMIC GOAL of any nation, as of any individual, is to get the greatest results with the least effort. The whole economic progress of mankind has consisted in getting more production with the same labor. 


It is for this reason that men began putting burdens on the backs of mules instead of on their own; that they went on to invent the wheel and the wagon, the railroad and the motor truck. It is for this reason that men used their ingenuity to develop a hundred thousand labor-saving inventions.


All this is so elementary that one would blush to state it if it were not being constantly forgotten by those who coin and circulate the new slogans. Translated into national terms, this first principle means that our real objective is to maximize production. 


In doing this, full employment—that is, the absence of involuntary idleness—becomes a necessary byproduct. But production is the end, employment merely the means. We cannot continuously have the fullest production without full employment. But we can very easily have full employment without full production.


Primitive tribes are naked, and wretchedly fed and housed, but they do not suffer from unemployment.


China and India are incomparably poorer than ourselves, but the main trouble from which they suffer is primitive production methods (which are both a cause and a consequence of a shortage of capital) and not unemployment. Nothing is easier to achieve than full employment, once it is divorced from the goal of full production and taken as an end in itself. 

Hitler provided full employment with a huge armament program. World War II provided full employment for every nation involved. 

The slave labor in Germany had full employment. Prisons and chain gangs have full employment. Coercion can always provide full employment.


Yet our legislators do not present Full Production bills in Congress but Full Employment bills. 


Even committees of businessmen recommend “a President’s Commission on Full Employment,” not on Full Production, or even on Full Employment and Full Production. Everywhere the means is erected into the end, and the end itself is forgotten.
Wages and employment are discussed as if they had no relation to productivity and output. 

On the assumption that there is only a fixed amount of work to be done, the conclusion is drawn that a thirty-hour week will provide more jobs and will therefore be preferable to a forty-hour week. A hundred make-work practices of labor unions are confusedly tolerated. 

When a Petrillo threatens to put a radio station out of business unless it employs twice as many musicians as it needs, he is supported by part of the public because he is after all merely trying to create jobs. 

When we had our WPA, it was considered a mark of genius for the administrators to think of projects that employed the largest number of men in relation to the value of the work performed—in other words, in which labor was least efficient.


It would be far better, if that were the choice—which it isn’t—to have maximum production with part of the population supported in idleness by undisguised relief than to provide “full employment” by so many forms of disguised make-work that production is disorganized. The progress of civilization has meant the reduction of employment, not its increase. 

It is because we have become increasingly wealthy as a nation that we have been able virtually to eliminate child labor, to remove the necessity of work for many of the aged and to make it unnecessary for millions of women to take jobs. 

A much smaller proportion of the American population needs to work than that, say, of China or of Russia. The real question is not how many millions of jobs there will be in America ten years from now, but how much shall we produce, and what, in consequence, will be our standard of living? 

The problem of distribution on which all the stress is being put today, is after all more easily solved the more there is to distribute.


We can clarify our thinking if we put our chief emphasis where it belongs—on policies that will maximize production.

Friday, November 18, 2011

PART 9 - Economics in One Lesson by Henry Hazlitt

The Lesson Applied

Disbanding Troops and Bureaucrats

 

 

 

Section 1

WHEN, AFTER EVERY great war, it is proposed to demobilize the armed forces, there is always a great fear that there will not be enough jobs for these forces and that in consequence they will be unemployed.


It is true that, when millions of men are suddenly released, it may require time for private industry to reabsorb them—though what has been chiefly remarkable in the past has been the speed, rather than the slowness, with which this was accomplished. The fears of unemployment arise because people look at only one side of the process.


They see soldiers being turned loose on the labor market. Where is the “purchasing power” going to come from to employ them?



If we assume that the public budget is being balanced, the answer is simple. The government will cease to support the soldiers. But the taxpayers will be allowed to retain the funds that were previously taken from them in order to support the soldiers.


And the taxpayers will then have additional funds to buy additional goods. Civilian demand, in other words, will be increased, and will give employment to the added labor force represented by the former soldiers.



If the soldiers have been supported by an unbalanced budget— that is, by government borrowing and other forms of deficit financing—the case is somewhat different. But that raises a different question: we shall consider the effects of deficit financing in a later chapter.


It is enough to recognize that deficit financing is irrelevant to the point that has just been made; for if we assume that there is any advantage in a budget deficit, then precisely the same budget deficit could be maintained as before by simply reducing taxes by the amount previously spent in supporting the wartime army.



But the demobilization will not leave us economically just where we were before it started. The soldiers previously supported by civilians will not become merely civilians supported by other civilians. They will become self-supporting civilians.

If we assume that the men who would otherwise have been retained in the armed forces are no longer needed for defense, then their retention would have been sheer waste. They would have been unproductive.


The taxpayers, in return for supporting them, would have got nothing. But now the taxpayers turn over this part of their funds to them as fellow civilians in return for equivalent goods or services. Total national production, the wealth of everybody, is higher.

Section 2

The same reasoning applies to civilian government officials whenever they are retained in excessive numbers and do not perform services for the community reasonably equivalent to the remuneration they receive. 


Yet whenever any effort is made to cut down the number of unnecessary officeholders the cry is certain to be raised that this action is “deflationary.” Would you remove the “purchasing power” from these officials? Would you injure the landlords and tradesmen who depend on that purchasing power? You are simply cutting down “the national income” and helping to bring about or intensify a depression.



Once again the fallacy comes from looking at the effects of this action only on the dismissed officeholders themselves and on the particular tradesmen who depend upon them. Once again it is forgotten that, if these bureaucrats are not retained in office, the taxpayers will be permitted to keep the money that was formerly taken from them for the support of the bureaucrats.


Once again it is forgotten that the taxpayers’ income and purchasing power go up by at least as much as the income and purchasing power of the former officeholders go down. If the particular shopkeepers who formerly got the business of these bureaucrats lose trade, other shopkeepers elsewhere gain at least as much. Washington is less prosperous, and can, perhaps, support fewer stores; but other towns can support more.


Once again, however, the matter does not end there. The country is not merely as well off without the superfluous officeholders as it would have been had it retained them. It is much better off. For the officeholders must now seek private jobs or set up private business. And the added purchasing power of the taxpayers, as we noted in the case of the soldiers, will encourage this. But the officeholders can take private jobs only by supplying equivalent services to those who provide the jobs—or, rather, to the customers of the employers who provide the jobs. Instead of being parasites, they become productive men and women.


I must insist again that in all this I am not talking of public officeholders whose services are really needed. Necessary policemen, firemen, street cleaners, health officers, judges, legislators and executives perform productive services as important as those of anyone in private industry. They make it possible for private industry to function in an atmosphere of law, order, freedom and peace. But their justification consists in the utility of their services. It does not consist in the “purchasing power” they possess by virtue of being on the public payroll.


This “purchasing power” argument is, when one considers it seriously, fantastic.


It could just as well apply to a racketeer or a thief who robs you. After he takes your money he has more purchasing power. He supports with it bars, restaurants, night clubs, tailors, perhaps automobile workers. But for every job his spending provides, your own spending must provide one less, because you have that much less to spend. Just so the taxpayers provide one less job for every job supplied by the spending of officeholders.


When your money is taken by a thief, you get nothing in return. When your money is taken through taxes to support needless bureaucrats, precisely the same situation exists. We are lucky, indeed, if the needless bureaucrats are mere easygoing loafers. They are more likely today to be energetic reformers busily discouraging and disrupting production.


When we can find no better argument for the retention of any group of officeholders than that of retaining their purchasing power it is a sign that the time has come to get rid of them.

 

Thursday, November 17, 2011

PART 8 - Economics in One Lesson by Henry Hazlitt

The Lesson Applied

Spread-the-Work Schemes

 

I HAVE REFERRED to various union make-work and feather-bed practices. These practices, and the public toleration of them, spring from the same fundamental fallacy as the fear of machines. This is the belief that a more efficient way of doing a thing destroys jobs, and its necessary corollary that a less efficient way of doing it creates them.



Allied to this fallacy is the belief that there is just a fixed amount of work to be done in the world, and that, if we cannot add to this work by thinking up more cumbersome ways of doing it, at least we can think of devices for spreading it around among as large a number of people as possible.



This error lies behind the minute subdivision of labor upon which unions insist. In the building trades in large cities the subdivision is notorious. Bricklayers are not allowed to use stones for a chimney: that is the special work of stonemasons. An electrician cannot rip out a board to fix a connection and put it back again: that is the special job, no matter how simple it may be, of the carpenters. A plumber will not remove or put back a tile incident to fixing a leak in the shower: that is the job of a tile-setter.



Furious “jurisdictional” strikes are fought among unions for the exclusive right to do certain types of borderline jobs. In a statement prepared by the American railroads for the Attorney-General’s Committee on Administrative Procedure, the roads gave innumerable examples in which the National Railroad Adjustment Board had decided that each separate operation on the railroad, no matter how minute, such as talking over a telephone or spiking or unspiking a switch, is so far an exclusive property of a particular class of employee that if an employee of another class, in the course of his regular duties, performs such operations he must not only be paid an extra day’s wages for doing so, but at the same time the furloughed or unemployed members of the class held to be entitled to perform the operation must be paid a day’s wages for not having been called upon to perform it.


It is true that a few persons can profit at the expense of the rest of us from this minute arbitrary subdivision of labor— provided it happens in their case alone. But those who support it as a general practice fail to see that it always raises production costs; that it results on net balance in less work done and in fewer goods produced. The householder who is forced to employ two men to do the work of one has, it is true, given employment to one extra man. But he has just that much less money left over to spend on something that would employ somebody else. Because his bathroom leak has been repaired at double what it should have cost, he decides not to buy the new sweater he wanted.


“Labor” is no better off, because a day’s employment of an unneeded tile-setter has meant a day’s disemployment of a sweater knitter or machine handler. The householder, however, is worse off. Instead of having a repaired shower and a sweater, he has the shower and no sweater. And if we count the sweater as part of the national wealth, the country is short one sweater. This symbolizes the net result of the effort to make extra work by arbitrary subdivision of labor.



But there are other schemes for “spreading the work,” often put forward by union spokesmen and legislators. The most frequent of these is the proposal to shorten the working week, usually by law. The belief that it would “spread the work” and “give more jobs” was one of the main reasons behind the inclusion of the penaltyovertime provision in the existing Federal Wage-Hour Law. 




The previous legislation in the states, forbidding the employment of women or minors for more, say, than forty-eight hours a week, was based on the conviction that longer hours were injurious to health and morale. Some of it was based on the belief that longer hours were harmful to efficiency. But the provision in the federal law, that an employer must pay a worker a 50 percent premium above his regular hourly rate of wages for all hours worked in any week above forty, was not based primarily on the belief that forty-five hours a week, say, was injurious either to health or efficiency.


It was inserted partly in the hope of boosting the worker’s weekly income, and partly in the hope that, by discouraging the employer from taking on anyone regularly for more than forty hours a week, it would force him to employ additional workers instead. At the time of writing this, there are many schemes for “averting unemployment” by enacting a thirty-hour week or a four-day week.



What is the actual effect of such plans, whether enforced by individual unions or by legislation? It will clarify the problem if we consider two cases. The first is a reduction in the standard working week from forty hours to thirty without any change in the hourly rate of pay. The second is a reduction in the working week from forty hours to thirty, but with a sufficient increase in hourly wage rates to maintain the same weekly pay for the individual workers already employed.



Let us take the first case. We assume that the working week is cut from forty hours to thirty, with no change in hourly pay. If there is substantial unemployment when this plan is put into effect, the plan will no doubt provide additional jobs. We cannot assume that it will provide sufficient additional jobs, however, to maintain the same payrolls and the same number of man-hours as before, unless we make the unlikely assumptions that in each industry there has been exactly the same percentage of unemployment and that the new men and women employed are no less efficient at their special tasks on the average than those who had already been employed. But suppose we do make these assumptions. 


Suppose we do assume that the right number of additional workers of each skill is available, and that the new workers do not raise production costs. What will be the result of reducing the working week from forty hours to thirty (without any increase in hourly pay)?


Though more workers will be employed, each will be working fewer hours, and there will, therefore, be no net increase in man-hours. It is unlikely that there will be any significant increase in production. Total payrolls and “purchasing power” will be no larger. All that will have happened, even under the most favorable assumptions (which would seldom be realized) is that the workers previously employed will subsidize, in effect, the workers previously unemployed. 


For in order that the new workers will individually receive three-fourths as many dollars a week as the old workers used to receive, the old workers will themselves now individually receive only three-fourths as many dollars a week as previously. It is true that the old workers will now work fewer hours; but this purchase of more leisure at a high price is presumably not a decision they have made for its own sake: it is a sacrifice made to provide others with jobs.


The labor union leaders who demand shorter weeks to “spread the work” usually recognize this, and therefore they put the proposal forward in a form in which everyone is supposed to eat his cake and have it too. Reduce the working week from forty hours to thirty, they tell us, to provide more jobs; but compensate for the shorter week by increasing the hourly rate of pay by 33.33 percent. The workers employed, say, were previously getting an average of $226 a week for forty hours work; in order that they may still get $226 for only thirty hours work, the hourly rate of pay must be advanced to an average of more than $7.53.


What would be the consequences of such a plan? The first and most obvious consequence would be to raise costs of production. If we assume that the workers, when previously employed for forty hours, were getting less than the level of production costs, prices and profits made possible, then they could have got the hourly increase without reducing the length of the working week.


They could, in other words, have worked the same number of hours and got their total weekly incomes increased by one-third, instead of merely getting, as they are under the new thirty-hour week, the same weekly income as before. But if under the forty-hour week, the workers were already getting as high a wage as the level of production costs and prices made possible (and the very unemployment they are trying to cure may be a sign that they were already getting even more than this), then the increase in production costs as a result of the 33.33 percent increase in hourly wage rates will be much greater than the existing state of prices, production and costs can stand.


The result of the higher wage rate, therefore, will be a much greater unemployment than before. The least efficient firms will be thrown out of business, and the least efficient workers will be thrown out of jobs. Production will be reduced all around the circle. Higher production costs and scarcer supplies will tend to raise prices, so that workers can buy less with the same dollar wages; on the other hand, the increased unemployment will shrink demand and hence tend to lower prices.


What ultimately happens to the prices of goods will depend upon what monetary policies are then allowed. But if a policy of monetary inflation is pursued, to enable prices to rise so that the increased hourly wages can be paid, this will merely be a disguised way of reducing real wage rates, so that these will return, in terms of the amount of goods they can purchase, to the same real rate as before. The result would then be the same as if the working week had been reduced without an increase in hourly wage rates. And the results of that have already been discussed.


The spread-the-work schemes, in brief, rest on the same sort of illusion that we have been considering. The people who support such schemes think only of the employment they might provide for particular persons or groups; they do not stop to consider what their whole effect would be on everybody.


The spread-the-work schemes rest also, as we began by pointing out, on the false assumption that there is just a fixed amount of work to be done. There could be no greater fallacy. There is no limit to the amount of work to be done as long as any human need or wish that work could fill remains unsatisfied. In a modern exchange economy, the most work will be done when prices, costs and wages are in the best relations with each other. What these relations are we shall later consider.

 

Saturday, November 12, 2011

PART 7 -Economics in One Lesson by Henry Hazlitt

The Curse of Machinery

Section 3

Not all inventions and discoveries, of course, are “labor-saving” machines. Some of them, like precision instruments, like nylon, lucite, plywood and plastics of all kinds, simply improve the quality of products. Others, like the telephone or the airplane, perform operations that direct human labor could not perform at all. Still others bring into existence objects and services, such as X-ray machines, radios, TV sets, air-conditioners and computers, that would otherwise not even exist. But in the foregoing illustration we have taken precisely the kind of machine that has been the special object of modern technophobia.





It is possible, of course, to push too far the argument that machines do not on net balance throw men out of work. It is sometimes argued, for example, that machines create more jobs than would otherwise have existed. Under certain conditions this may be true. They can certainly create enormously more jobs in particular trades. The eighteenth century figures for the textile industries are a case in point. 


Their modern counterparts are certainly no less striking. In 1910, 140,000 persons were employed in the United States in the newly created automobile industry. In 1920, as the product was improved and its cost reduced, the industry employed 250,000 In 1930, as this product improvement and cost reduction continued, employment in the industry was 380,000. In 1973 it had risen to 941,000. By 1973, 514,000 people were employed in making aircraft and aircraft parts, and 393,000 were engaged in making electronic components. So it has been in one newly created trade after another, as the invention was improved and the cost reduced.2


There is also an absolute sense in which machines may be said to have enormously increased the number of jobs. The population of the world today is four times as great as in the middle of the eighteenth century, before the Industrial Revolution had got well under way. Machines may be said to have given birth to this increased population; for without the machines, the world would not have been able to support it. Three out of every four of us, therefore, may be said to owe not only our jobs but our very lives to machines.


Yet it is a misconception to think of the function or result of machines as primarily one of creating jobs. The real result of the machine is to increase production, to raise the standard of living, to increase economic welfare. It is no trick to employ everybody, even (or especially) in the most primitive economy. 

Full employment—very full employment; long, weary, backbreaking employment—is characteristic of precisely the nations that are most retarded industrially. Where full employment already exists, new machines, inventions and discoveries cannot—until there has been time for an increase in population — bring more employment. They are likely to bring more unemployment (but this time I am speaking of voluntaiy and not involuntary unemployment) because people can now afford to work fewer hours, while children and the overaged no longer need to work.


What machines do, to repeat, is to bring an increase in production and an increase in the standard of living. They may do this in either of two ways. They do it by making goods cheaper for consumers (as in our illustration of the overcoats), or they do it by increasing wages because they increase the productivity of the workers.


In other words, they either increase money wages or, by reducing prices, they increase the goods and services that the same money wages will buy. Sometimes they do both. What actually happens will depend in large part upon the monetary policy pursued in a country. But in any case, machines, inventions and discoveries increase real wages.


The Curse of Machinery

Section 4


A warning is necessary before we leave this subject. It was precisely the great merit of the classical economists that they looked for secondary consequences, that they were concerned with the effects of a given economic policy or development in the long run and on the whole community. But it was also their defect that, in taking the long view and the broad view, they sometimes neglected to take also the short view and the narrow view.


They were too often inclined to minimize or to forget altogether the immediate effects of developments on special groups. We have seen, for example, that many of the English stocking knitters suffered real tragedies as a result of the introduction of the new stocking frames, one of the earliest inventions of the Industrial Revolution.


But such facts and their modern counterparts have led some writers to the opposite extreme of looking only at the immediate effects on certain groups. Joe Smith is thrown out of a job by the introduction of some new machine. “Keep your eye on Joe Smith,” these writers insist. “Never lose track of Joe Smith.” 


But what they then proceed to do is to keep their eyes only on Joe Smith, and to forget Tom Jones, who has just got a new job in making the new machine, and Ted Brown, who has just got a job operating one, and Daisy Miller, who can now buy a coat for half what it used to cost her. And because they think only of Joe Smith, they end by advocating reactionary and nonsensical policies.


Yes, we should keep at least one eye on Joe Smith. He has been thrown out of a job by the new machine. Perhaps he can soon get another job, even a better one. But perhaps, also, he has devoted many years of his life to acquiring and improving a special skill for which the market no longer has any use. He has lost this investment in himself, in his old skill, just as his former employer, perhaps, has lost his investment in old machines or processes suddenly rendered obsolete. He was a skilled workman, and paid as a skilled workman.


Now he has become overnight an unskilled workman again, and can hope, for the present, only for the wages of an unskilled workman, because the one skill he had is no longer needed. We cannot and must not forget Joe Smith. His is one of the personal tragedies that, as we shall see, are incident to nearly all industrial and economic progress.


To ask precisely what course we should follow with Joe Smith —whether we should let him make his own adjustment, give him separation pay or unemployment compensation, put him on relief, or train him at government expense for a new job—would carry us beyond the point that we are here trying to illustrate. The central lesson is that we should try to see all the main consequences of any economic policy or development—the immediate effects on special groups, and the long-run effects on all groups.


If we have devoted considerable space to this issue, it is because our conclusions regarding the effects of new machinery, inventions and discoveries on employment, production and welfare are crucial. If we are wrong about these, there are few things in economics about which we are likely to be right.

Friday, November 11, 2011

PART 6 - Economics in One Lesson by Henry Hazlitt

The Curse of Machinery

Section 2

 

 

 

But the opposition to labor-saving machinery, even today, is not confined to economic illiterates. As late as 1970, a book appeared by a writer so highly regarded that he has since received the Nobel Prize in economics. His book opposed the introduction of laborsaving machines in the underdeveloped countries on the ground that they “decrease the demand forlabor”!* 


The logical conclusion from this would be that the way to maximize jobs is to make all labor as inefficient and unproductive as possible. It implies that the English Luddite rioters, who in the early nineteenth century destroyed stocking frames, steam-power looms, and shearing machines, were after all doing the right thing.


One might pile up mountains of figures to show how wrong were the technophobes of the past. But it would do no good unless we understood clearly why they were wrong. For statistics and history are useless in economics unless accompanied by a basic deductive understanding of the facts—which means in this case an understanding of why the past consequences of the introduction of machinery and other labor-saving devices had to occur. 


Otherwise the technophobes will assert (as they do in fact assert when you point out to them that the prophecies of their predecessorsturned out to be absurd): “That may have been all very well in the past but today conditions are fundamentally different; and now we simply cannot afford to develop any more labor-saving machines.” 

Mrs. Eleanor Roosevelt, indeed, in a syndicated newspaper column of September19, 1945, wrote: “We have reached a point today where labor-saving devices are good only when they do not throw the worker out of his job.”


If it were indeed true that the introduction of labor-saving machinery is a cause of constantly mounting unemployment and misery, the logical conclusions to be drawn would be revolutionary, not only in the technical field but for our whole concept of civilization. Not only should we have to regard all further technical progress as a calamity; we should have to regard all past technical progress with equal horror. 

Every day each of us in his own activity is engaged in trying to reduce the effort it requires to accomplish a given result. Each of us is trying to save his own labor, to economize the means required to achieve his ends. Every employer, small as well as large, seeks constantly to gain his results more economically and efficiently— that is, by saving labor. Every intelligent workman tries to cut down the effort necessary to accomplish his assigned job.


The most ambitious of us try tirelessly to increase the results we can achieve in a given number of hours. The technophobes, if they were logical and consistent, would have to dismiss all this progress and ingenuity as not only useless but vicious. Why should freight be carried from Chicago to New York by railroad when we could employ enormously more men, for example, to carry it all on their backs?


Theories as false as this are never held with logical consistency, but they do great harm because they are held at all. Let us, therefore, try to see exactly what happens when technical improvements and labor-saving machinery are introduced. 


The details will vary in each instance, depending upon the particular conditions that prevail in a given industry or period. But we shall assume an example that involves the main possibilities.
Suppose a clothing manufacturer learns of a machine that will make men’s and women s overcoats for half as much labor as previously. He installs the machines and drops half his labor force.


This looks at first glance like a clear loss of employment. But the machine itself required labor to make it; so here, as one offset, are jobs that would not otherwise have existed. The manufacturer, however, would have adopted the machine only if it had either made better suits for half as much labor, or had made the same kind of suits at a smaller cost. If we assume the latter, we cannot assume that the amount of labor to make the machines was as great in terms of payrolls as the amount of labor that the clothing manufacturer hopes to save in the long run by adopting the machine; otherwise there would have been no economy, and he would not have adopted it.


So there is still a net loss of employment to be accounted for. But we should at least keep in mind the real possibility that even the first effect of the introduction of labor-saving machinery may be to increase employment on net balance; because it is usually only in the long run that the clothing manufacturer expects to save money by adopting the machine: it may take several years for the machine to “pay for itself.”


After the machine has produced economies sufficient to offset its cost, the clothing manufacturer has more profits than before. (We shall assume that he merely sells his coats for the same price as his competitors and makes no effort to undersell them.) At this point, it may seem, labor has suffered a net loss of employment, while it is only the manufacturer, the capitalist, who has gained. But it is precisely out of these extra profits that the subsequent social gains must come.


The manufacturer must use these extra profits in at least one of three ways, and possibly he will use part of them in all three:

(1) he will use the extra profits to expand his operations by buying more machines to make more coats; or

(2) he will invest the extra profits in some other industry; or (3) he will spend the extra profits on increasing his own consumption. Whichever of these three courses he takes, he will increase employment.


In other words, the manufacturer, as a result of his economies, has profits that he did not have before. Every dollar of the amount he has saved in direct wages to former coat makers, he now has to pay out in indirect wages to the makers of the new machine, or to the workers in another capital-using industry, or to the makers of a new house or car for himself or for jewelry and furs for his wife. In any case (unless he is a pointless hoarder) he gives indirectly as many jobs as he ceased to give directly.


But the matter does not and cannot rest at this stage. If this enterprising manufacturer effects great economies as compared with his competitors, either he will begin to expand his operations at their expense, or they will start buying the machines too. Again more work will be given to the makers of the machines.


But competition and production will then also begin to force down the price of overcoats. There will no longer be as great profits for those who adopt the new machines. The rate of profit of the manufacturers using the new machine will begin to drop, while the manufacturers who have still not adopted the machine may now make no profit at all. The savings, in other words, will begin to be passed along to the buyers of overcoats—to the consumers.


But as overcoats are now cheaper, more people will buy them. This means that, though it takes fewer people to make the same number of overcoats as before, more overcoats are now being made than before. If the demand for overcoats is what economists call “elastic”—that is, if a fall in the price of overcoats causes a larger total amount of money to be spent on overcoats than previously— then more people may be employed even in making overcoats than before the new labor-saving machine was introduced. We have already seen how this actually happened historically with stockings and other textiles.


But the new employment does not depend on the elasticity of demand for the particular product involved. Suppose that, though the price of overcoats was almost cut in half—from a former price, say, of $150 to a new price of $100—not a single additional coat was sold. The result would be that while consumers were as well provided with new overcoats as before, each buyer would now have $50 left over that he would not have had left over before.

He will therefore spend this $50 for something else, and so provide increased employment in other lines.


In brief, on net balance machines, technological improvements, automation, economies and efficiency do not throw men out of work.

Tuesday, November 8, 2011

PART 5 - Economics in One Lesson by Henry Hazlitt

The Curse of Machinery

 

AMONG THE MOST viable of all economic delusions is the belief that machines on net balance create unemployment.

Destroyed a thousand times, it has risen a thousand times out of its own ashes as hardy and vigorous as ever. Whenever there is long-continued mass unemployment, machines get the blame anew. This fallacy is still the basis of many labor union practices. The public tolerates these practices because it either believes at bottom that the unions are right, or is too confused to see just why they are wrong.


The belief that machines cause unemployment, when held with any logical consistency, leads to preposterous conclusions. Not only must we be causing unemployment with every technological improvement we make today, but primitive man must have started causing it with the first efforts he made to save himself from needless toil and sweat.


To go no further back, let us turn to Adam Smith’s Wealth of Nations, published in 1776. The first chapter of this remarkable book is called “Of the Division of Labor,” and on the second page of this first chapter the author tells us that a workman unacquainted with the use of machinery employed in pin-making “could scarce make one pin a day, and certainly could not make twenty,” but with the use of this machinery he can make 4,800 pins a day. So already, alas, in Adam Smith’s time, machinery had thrown from 240 to 4,800 pin-makers out of work for every one it kept. In the pin-making industry there was already, if machines merely throw men out of jobs, 99.98 percent unemployment. Could things be blacker?


Things could be blacker, for the Industrial Revolution was just in its infancy. Let us look at some of the incidents and aspects of that revolution.

Let us see, for example, what happened in the stocking industry. New stocking frames as they were introduced were destroyed by the handicraft workmen (over 1000 in a single riot), houses were burned, the inventors were threatened and obliged to flee for their lives, and order was not finally restored until the military had been called out and the leading rioters had been either transported or hanged.


Now it is important to bear in mind that insofar as the rioters were thinking of their own immediate or even longer futures their opposition to the machine was rational. 


For William Felkin, in his History of the Machine-Wrought Hosiery Manufactures (1867), tells us (though the statement seems implausible) that the larger part of the 50,000 English stocking knitters and their families did not fully emerge from the hunger and misery entailed by the introduction of the machine for the next forty years. But insofar as the rioters believed, as most of them undoubtedly did, that the machine was permanently displacing men, they were mistaken, for before the end of the nineteenth century the stocking industry was employing at least a hundred men for every man it employed at the beginning of the century.


Arkwright invented his cotton-spinning machinery in 1760. At that time it was estimated that there were in England 5,200 spinners using spinning wheels, and 2,700 weavers—in all, 7,900 persons engaged in the production of cotton textiles. The introduction of Arkwright’s invention was opposed on the ground that it threatened the livelihood of the workers, and the opposition had to be put down by force.

Yet in 1787—twenty-seven years after the invention appeared—a parliamentary inquiry showed that the number of persons actually engaged in the spinning and weaving of cotton had risen from 7,900 to 320,000, an increase of 4,400 percent.


If the reader will consult such a book as Recent Economic Changes, by David A. Wells, published in 1889, he will find passages that, except for the dates and absolute amounts involved, might have been written by our technophobes of today. Let me quote a few:

During the ten years from 1870 to 1880, inclusive, the British mercantile marine increased its movement, in the matter of foreign entries and clearances alone, to the extent of 22,000,000 tons... yet the number of men who were employed in effecting this great movement had decreased in 1880, as compared with 1870, to the extent of about three thousand (2,990 exactly). What did it? The introduction of steam-hoisting machines and grain elevators upon the wharves and docks, the employment of steam power, etc....


In 1873 Bessemer steel in England, where its price had not been enhanced by protective duties, commanded $80 per ton; in 1886 it was profitably manufactured and sold in the same country for less than $20 per ton. Within the same time the annual production capacity of a Bessemer converter has been increased fourfold, with no increase but rather a diminution of the involved labor.


The power capacity already being exerted by the steam engines of the world in existence and working in the year 1887 has been estimated by the Bureau of Statistics at Berlin as equivalent to that of 200,000,000 horses, representing approximately 1,000,000,000 men; or at least three times the working population of the earth....
One would think that this last figure would have caused Mr. Wells to pause, and wonder why there was any employment left in the world of 1889 at all; but he merely concluded, with restrained pessimism, that “under such circumstances industrial overproduction . . . may become chronic.”


In the depression of 1932, the game of blaming unemployment on the machines started all over again. Within a few months the doctrines of a group calling themselves the Technocrats had spread through the country like a forest fire.

I shall not weary the reader with a recital of the fantastic figures put forward by this group or with corrections to show what the real facts were. It is enough to say that the Technocrats returned to the error in all its native purity that machines permanently displace men—except that, in their ignorance, they presented this error as a new and revolutionary discovery of their own. It was simply one more illustration of Santayana’s aphorism that those who cannot remember the past are condemned to repeat it.


The Technocrats were finally laughed out of existence; but their doctrine, which preceded them, lingers on. It is reflected in hundreds of make-work rules and featherbed practices by labor unions; and these rules and practices are tolerated and even approved because of the confusion on this point in the public mind.


Testifying on behalf of the United States Department of Justice before the Temporary National Economic Committee (better known as the TNEC) in March 1941, Corwin Edwards cited innumerable examples of such practices. The electrical union in New York City was charged with refusal to install electrical equipment made outside of New York State unless the equipment was disassembled and reassembled at the job site. In Houston, Texas, master plumbers and the plumbing union agreed that piping prefabricated for installation would be installed by the union only if the thread were cut off one end of the pipe and new thread were cut at the job site.

Various locals of the painters’ union imposed restrictions on the use of sprayguns, restrictions in many cases designed merely to make work by requiring the slower process of applying paint with a brush. A local of the teamsters’ union required that every truck entering the New York metropolitan area have a local driver in addition to the driver already employed. In various cities the electrical union required that if any temporary light or power was to be used on a construction job there must be a full-time maintenance electrician, who should not be permitted to do any electrical construction work. This rule, according to Mr. Edwards, “often involves the hiring of a man who spends his day reading or playing solitaire and does nothing except throw a switch at the beginning and end of the day.”


One could go on to cite such make-work practices in many other fields. In the railroad industry, the unions insist that firemen be employed on types of locomotives that do not need them. In the theaters unions insist on the use of scene shifters even in plays in which no scenery is used. The musicians’ union required so-called stand-in musicians or even whole orchestras to be employed in many cases where only phonograph records were needed.


By 1961 there was no sign that the fallacy had died. Not only union leaders but government officials talked solemnly of “automation” as a major cause of unemployment. Automation was discussed as if it were something entirely new in the world. It was in fact merely a new name for continued technological advance and further progress in labor-saving equipment.

 

Sunday, November 6, 2011

PART 4 Economics in One Lesson by Henry Hazlitt

Taxes Discourage Production


There is a still further factor which makes it improbable that the wealth created by government spending will fully compensate for the wealth destroyed by the taxes imposed to pay for that spending. It is not a simple question, as so often supposed, of taking something out of the nation’s right-hand pocket to put into its left-hand pocket. The government spenders tell us, for example, that if the national income is $1,500 billion then federal taxes of $360 billion a year would mean that only 24 percent of the national income is being transferred from private purposes to public purposes.
 

This is to talk as if the country were the same sort of unit of pooled resources as a huge corporation, and as if all that were involved were a mere bookkeeping transaction. The government spenders forget that they are taking the money from A in order to pay it to B. Or rather, they know this very well but while they dilate upon all the benefits of the process to B, and all the wonderful things he will have which he would not have had if the money had not been transferred to him, they forget the effects of the transaction on A. B is seen; A is forgotten.





In our modern world there is never the same percentage of income tax levied on everybody. The great burden of income taxes is imposed on a minor percentage of the nation’s income; and these income taxes have to be supplemented by taxes of other kinds. These taxes inevitably affect the actions and incentives of those from whom they are taken. When a corporation loses a hundred cents of every dollar it loses, and is permitted to keep only fifty-two cents of every dollar it gains, and when it cannot adequately offset its years of losses against its years of gains, its policies are affected. It does not expand its operations, or it expands only those attended with a minimum of risk.


People who recognize this situation are deterred from starting new enterprises. Thus old employers do not give more employment, or not as much more as they might have; and others decide not to become employers at all. Improved machinery and better-equipped factories come into existence much more slowly than they otherwise would. The result in the long run is that consumers are prevented from getting better and cheaper products to the extent that they otherwise would, and that real wages are held down, compared with what they might have been.


There is a similar effect when personal incomes are taxed 50, 60 or 70 percent. People begin to ask themselves why they should work six, eight or nine months of the entire year for the government, and only six, four or three months for themselves and their families. If they lose the whole dollar when they lose, but can keep only a fraction of it when they win, they decide that it is foolish to take risks with their capital.

In addition, the capital available for risk-taking itself shrinks enormously. It is being taxed away before it can be accumulated. In brief, capital to provide new private jobs is first prevented from coming into existence, and the part that does come into existence is then discouraged from starting new enterprises. The government spenders create the very problem of unemployment that they profess to solve.




A certain amount of taxes is of course indispensable to carry on essential government functions. Reasonable taxes for this purpose need not hurt production much. 


The kind of government services then supplied in return, which among other things safeguard production itself, more than compensate for this. But the larger the percentage of the national income taken by taxes the greater the deterrent to private production and employment. When the total tax burden grows beyond a bearable size, the problem of devising taxes that will not discourage and disrupt production becomes insoluble.


Credit Diverts Production


Government “encouragement” to business is sometimes as much to be feared as government hostility. This supposed encouragement often takes the form of a direct grant of government credit or a guarantee of private loans.


The question of government credit can often be complicated, because it involves the possibility of inflation. We shall defer analysis of the effects of inflation of various kinds until a later chapter. Here, for the sake of simplicity, we shall assume that the credit we are discussing is noninflationary. Inflation, as we shall later see, while it complicates the analysis, does not at bottom change the consequences of the policies discussed.


A frequent proposal of this sort in Congress is for more credit to farmers. In the eyes of most congressmen the farmers simply cannot get enough credit. The credit supplied by private mortgage companies, insurance companies or country banks is never “adequate.” Congress is always finding new gaps that are not filled by the existing lending institutions, no matter how many of these it has itself already brought into existence.


The farmers may have enough long-term credit or enough short-term credit but, it turns out, they have not enough “intermediate” credit; or the interest rate is too high; or the complaint is that private loans are made only to rich and well-established farmers. So new lending institutions and new types of farm loans are piled on top of each other by the legislature.


The faith in all these policies, it will be found, springs from two acts of shortsightedness. One is to look at the matter only from the standpoint of the farmers that borrow. The other is to think only of the first half of the transaction.


Now all loans, in the eyes of honest borrowers, must eventually be repaid. All credit is debt. Proposals for an increased volume of credit, therefore, are merely another name for proposals for an increased burden of debt. They would seem considerably less inviting if they were habitually referred to by the second name instead of by the first.



We need not discuss here the normal loans that are made to farmers through private sources. They consist of mortgages, of installment credits for the purchase of automobiles, refrigerators, TV sets, tractors and other farm machinery, and of bank loans made to carry the farmer along until he is able to harvest and market his crop and get paid for it. Here we need concern ourselves only with loans to farmers either made directly by some government bureau or guaranteed by it.



These loans are of two main types. One is a loan to enable the farmer to hold his crop off the market. This is an especially harmful type, but it will be more convenient to consider it later when we come to the question of government commodity controls. The other is a loan to provide capital—often to set the farmer up in business by enabling him to buy the farm itself or a mule or tractor, or all three.


At first glance the case for this type of loan may seem a strong one. Here is a poor family, it will be said, with no means of livelihood. It is cruel and wasteful to put them on relief. Buy a farm for them; set them up in business; make productive and self-respecting citizens of them; let them add to the total national product and pay the loan off out of what they produce. Or here is a farmer struggling along with primitive methods of production because he has not the capital to buy himself a tractor.


Lend him the money for one; let him increase productivity; he can repay the loan out of the proceeds of his increased crops. In that way you not only enrich him and put him on his feet; you enrich the whole community by that much added output. And the loan, concludes the argument, costs the government and the taxpayers less than nothing, because it is “self-liquidating.”


Now as a matter of fact that is what happens every day under the institution of private credit. If a man wishes to buy a farm, and has, let us say, only half or a third as much money as the farm costs, a neighbor or a savings bank will lend him the rest in the form of a mortgage on the farm. If he wishes to buy a tractor, the tractor company itself or a finance company, will allow him to buy it for one-third of the purchase price with the rest to be paid off in installments out of earnings that the tractor itself will help to provide.


But there is a decisive difference between the loans supplied by private lenders and the loans supplied by a government agency. Each private lender risks his own funds. (A banker, it is true, risks the funds of others that have been entrusted to him; but if money is lost he must either make good out of his own funds or be forced out of business.) When people risk their own funds they are usually careful in their investigations to determine the adequacy of the assets pledged and the business acumen and honesty of the borrower.


If the government operated by the same strict standards, there would be no good argument for its entering the field at all. Why do precisely what private agencies already do? But the government almost invariably operates by different standards.


The whole argument for its entering the lending business, in fact, is that it will make loans to people who could not get them from private lenders. This is only another way of saying that the government lenders will take risks with other people’s money (the taxpayers’) that private lenders will not take with their own money. Sometimes, in fact, apologists will freely acknowledge that the percentage of losses will be higher on these government loans than on private loans. But they contend that this will be more than offset by the added production brought into existence by the borrowers who pay back, and even by most of the borrowers who do not pay back.


This argument will seem plausible only as long as we concentrate our attention on the particular borrowers whom the government supplies with funds, and overlook the people whom its plan deprives of funds. For what is really being lent is not money, which is merely the medium of exchange, but capital.

(I have already put the reader on notice that we shall postpone to a later point the complications introduced by an inflationary expansion of credit.) What is really being lent, say, is the farm or the tractor itself. Now the number of farms in existence is limited, and so is the production of tractors (assuming, especially, that an economic surplus of tractors is not produced simply at the expense of other things). The farm or tractor that is lent to A cannot be lent to B. 

The real question is, therefore, whether A or B shall get the farm.
This brings us to the respective merits ofA and B, and what each contributes, or is capable of contributing, to production. A, let us say, is the man who would get the farm if the government did not intervene. The local banker or his neighbors know him and know his record. They want to find employment for their funds. 


They know that he is a good farmer and an honest man who keeps his word. They consider him a good risk. He has already, perhaps, through industry, frugality and foresight, accumulated enough cash to pay a fourth of the price of the farm. They lend him the other three-fourths; and he gets the farm.


There is a strange idea abroad, held by all monetary cranks, that credit is something a banker gives to a man. Credit on the contrary, is something a man already has. He has it, perhaps, because he already has marketable assets of a greater cash value than the loan for which he is asking. Or he has it because his character and past record have earned it. He brings it into the bank with him. That is why the banker makes him the loan.


The banker is not giving something for nothing. He feels assured of repayment. He is merely exchanging a more liquid form of asset or credit for a less liquid form. Sometimes he makes a mistake, and then it is not only the banker who suffers, but the whole community; for values which were supposed to be produced by the lender are not produced and resources are wasted.


Now it is to A, let us say, who has credit that the banker would make his loan. But the government goes into the lending business in a charitable frame of mind because, as we say, it is worried about B. B cannot get a mortgage or other loans from private lenders because he does not have credit with them. He has no savings; he has no impressive record as a good farmer; he is perhaps at the moment on relief. Why not, say the advocates of government credit, make him a useful and productive member of society by lending him enough for a farm and a mule or tractor and setting him up in business?


Perhaps in an individual case it may work out all right. But it is obvious that in general the people selected by these government standards will be poorer risks than the people selected by private standards. More money will be lost by loans to them. There will be a much higher percentage of failures among them. They will be less efficient. More resources will be wasted by them. Yet the recipients of government credit will get their farms and tractors at the expense of those who otherwise would have been the recipients of private credit. Because B has a farm, A will be deprived of a farm.


A may be squeezed out either because interest rates have gone up as a result of the government operations, or because farm prices have been forced up as a result of them, or because there is no other farm to be had in his neighborhood. In any case, the net result of government credit has not been to increase the amount of wealth produced by the community but to reduce it, because the available real capital (consisting of actual farms, tractors, etc.) has been placed in the hands of the less efficient borrowers rather than in the hands of the more efficient and trustworthy.


 

 

1791 The Original Blueprint

Progressive's Violent Rhetoric: Where's the Love?

QUESTION?

When I pay INCOME TAXES am I not supporting the Congress and all the salaries they make (waste) ?

Of course I am, so why can't I then list Congress as my DEPENDENTS and DEDUCT THEM?

THE I.R.S. IS THE GREATEST DECEPTIVE ARM OF THE GOVERNMENT...THERE IS NO LAW THAT SAYS YOU HAVE TO PAY AN INCOME TAX, ITS AN ILLEGAL CORPORATE LAW NOT AN INDIVIDUAL LAW!

Is the INCOME TAX legal? NO, NO, NO....It's Illegal at the core!

Text of the 16th Amendment to the Constitution of the United States of America:
"The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration."
Go to this link at "The Power Hour" to get the tools to fight Government CONTROL beyond the constitution!
to go to this website "The Law that never was!"
After knowing this if you still must pay them then know HOW TO PAY LESS TAXES BY FINDING MORE DEDUCTIONS, WRITE OFFS AND TAX LOOP HOLES YOU ARE PROBABLY PAYING TOO MUCH IN FEDERAL TAXES
CLICK HERE: WE CAN HELP! SOLUTIONS NETWORK TAX ASSISTANCE If you desire a professional who is dedicated to finding the legitimate deductions and write offs that most preparers just don't look for, call us Toll Free 877 604 6636 Extension 3 For a FREE CONSULTATION Please, when calling reference Service ID CS10737 Our goal is to maximize your tax position. Whether you utilize our services, or simply take advantage of the information we provide. We want to help you keep more of YOUR money.

The real truth about the economy! GBTV- The Truth Lives Here!

Learn your Constitution: There's no Excuse not to know it anymore!

America: Freedom to Fascism - Director's Authorized Version

John Adams said:


"We electors have an important constitutional power placed in our hands: we have a check upon two branches of the legislature, as each branch has upon the other two; the power I mean of electing at stated periods, one branch, which branch has the power of electing another.

It becomes necessary to every subject then, to be in some degree a statesman: and to examine and judge for himself of the tendencies of political principles and measures."

The Constitution and Bill of Rights

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Which do you perfer?

HeliumCapitalism vs. Socialism: Which do you prefer?

This is great!

Middle East Myths and Facts

1. Nationhood and Jerusalem - Israel became a nation in 1312 B.C.E., two thousand years before the rise of Islam.

2. Arab refugees in Israel began identifying themselves as part of a Palestinian people in 1967, two decades after the establishment of the modern State of Israel.

3. Since the Jewish conquest in 1272 B.C.E. the Jews have had dominion over the land for one thousand years with a continuous presence in the land for the past 3,300 years.

4. Arabs have only had control of Israel twice - from 634 until the Crusader invasion in June 1099, and from 1292 until the year 1517 when they were dispelled by the Turks in their conquest.

5. For over 3,300 years, Jerusalem has been the Jewish capital. Jerusalem has never been the capital of any Arab or Muslim entity. Even when the Jordanians occupied Jerusalem, they never sought to make it their capital, and Arab leaders did not come to visit.

6. Jerusalem is mentioned over 700 times in Tanach, the Jewish Holy Scriptures. Jerusalem is not mentioned once in the Koran. There are vague references to Jerusalem in the Hadiths - stories about Mohammed - that he stopped his night journey (which the Koran explains took place in a dream!) at the "farther mosque" (or "distant place"). Muslims explain that this means "at the edge of the Temple mount", although no direct reference to Jerusalem or the Temple Mount is made.

7. King David established the city of Jerusalem as Israel's capital. Mohammed never came to Jerusalem.

8. Jews pray facing Jerusalem. Some Muslims (i.e. those between Israel and Saudi Arabia) pray with their backs toward Jerusalem.

9. Arab and Jewish Refugees - In 1948 the Arab refugees were encouraged to leave Israel by Arab leaders promising to purge the land of Jews. Sixty eight percent left without ever seeing an Israeli soldier.

10. The Jewish refugees were forced to flee from Arab lands due to Arab brutality, persecution and pogroms.

11. The number of Arab refugees who left Israel in 1948 is estimated to be around 630,000. The number of Jewish refugees from Arab lands is estimated to be the same.

12. Arab refugees were INTENTIONALLY not absorbed or integrated into the Arab lands to which they fled, despite the vast Arab territory. Out of the 100,000,000 refugees since World War II, theirs is the only refugee group in the world that has never been absorbed or integrated into their own peoples' lands. Jewish refugees were completely absorbed into Israel, a country no larger than the state of New Jersey.

13. The Arab - Israeli Conflict - The Arabs are represented by eight separate nations, not including the Palestinians. There is only one Jewish nation. The Arab nations initiated all five wars and lost. Israel defended itself each time and won.

14. The P.L.O.'s Charter still calls for the destruction of the State of Israel. Israel has given the Palestinians most of the West Bank land, autonomy under the Palestinian Authority, and has supplied them with weapons.

15. Under Jordanian rule, Jewish holy sites were desecrated and the Jews were denied access to places of worship. Under Israeli rule, all Muslim and Christian sites have been preserved and made accessible to people of all faiths.

16. The U.N. Record on Israel and the Arabs - Of the 175 Security Council resolutions passed before 1990, 97 were directed against Israel.

17. Of the 690 General Assembly resolutions voted on before 1990, 429 were directed against Israel.

18. The U.N was silent while 58 Jerusalem Synagogues were destroyed by the Jordanians.

19. The U.N. was silent while the Jordanians systematically desecrated the ancient Jewish cemetery on the Mount of Olives.

20. The U.N. was silent while the Jordanians enforced an apartheid-like policy of preventing Jews from visiting the Temple Mount and the Western Wall.

For those of us who believe that the "Israeli Occupation" has been bad for the Palestinian people, these facts may change your perception. The "occupation" seems to have brought nothing but good to the Palestinians - we can only imagine how much worse they would be if Israel hadn't helped them!

1. During 20 years of Arab rule Palestinian male life expectancy grew from 42 to 44. During the next 20 years of Israeli rule Palestinian male life expectancy grew from 44 to 63.

2. During 20 years of Arab rule Palestinian female life expectancy grew from 45 to 46. During the next 20 years of Israeli rule Palestinian female life expectancy grew from 46 to 67.

3. During 20 years of Arab rule Palestinian infant mortality rate decreased from 200 per thousand to 170 per thousand. During the next 20 years of Israeli rule Palestinian infant mortality rate decreased from 170 per thousand to 60 per thousand.

4. During 20 years of Arab rule Palestinian crude death rate decreased from 21 per thousand to 19 per thousand. During next 20 years of Israeli rule Palestinian infant mortality rate decreased from 19 per thousand to 6 per thousand.

5. Before 1967, when Israel's rule began, only 113 hospitals had been built in the territories. By the time of 1989 Israel had helped establish more than three times that number to 387.

6. Before 1967 only 23 Mother & Child Centers had been established. After 1989 about six times as many could be found. (135)

7. Malaria, which had existed in the territories before 1967 was finally eliminated during the Israeli rule.

8. Israel also more than tripled the number of Palestinian teachers and boosted the Palestinian educational system by establishing a number of universities.

Among those universities were the College of Scientists (Abu Dis) - est. 1982, the College of Social Welfare (El Bira) - est. 1979, the College of Religion (Beit Hanina) - est. 1978 and the Islamic College in Hebron- est.1971.

9. This was not the only effect Israeli rule had on the Palestinian education system and the Palestinian people.

Before 1967 the percentage of illiterates on average had been 27.8% among men and among women even higher at 65.1%. By 1983 Israel had helped reduce illiteracy to only 13.5% among men and 38.9% among women.

The Truth About the Mideast
Fourteen fundamental facts about Israel and Palestine

By David G. Littman

October 7, 2002

It's time to look back on 14 fundamental geographical, historical, and diplomatic facts from the last century relating to the Middle East. These basic facts and figures were stressed in recent statements to the U.N. Commission on Human Rights and its subcommission, to the surprise of representatives of both states and non-governmental organizations (NGOs).

1) After World War I Great Britain accepted the 1922 Mandate for Palestine, and then — with League of Nations approval — used its article 25 to create two distinct entities within the Mandate-designated area.

2) The territory lying between the Jordan River and the eastern desert boundary "of that part of Palestine which was known as Trans-Jordan" (nearly 78 percent) thus became the Emirate of Transjordan.

This new entity was put under the rule of Emir Abdullah, the eldest son of the Sharif of Mecca, as a recompense for his support in the war against the Turks, and of Ibn Saud's seizure of Arabia (Faisal, Abdullah's brother, later received the even vaster Mandate area of Iraq).

3) Turning a blind eye to article 15, Great Britain also decided that no Jews could reside or buy land in the newly created Emirate. This policy was ratified — after the emirate became a kingdom — by Jordan's law no. 6, sect. 3, on April 3, 1954, and reactivated in law no. 7, sect. 2, on April 1, 1963. It states that any person may become a citizen of Jordan unless he is a Jew. King Hussein made peace with Israel in 1994, but the Judenrein legislation remains valid today.

4) The remaining area west of the Jordan River (comprising about 22 percent of the original Mandate) was then officially designated "Palestine" by Great Britain. As stated in the 1937 Royal Commission Report, "the primary purpose of the Mandate, as expressed in its preamble and its articles, is to promote the establishment of the Jewish National Home." This was now greatly restricted.

5) U.N. General Assembly Resolution 181 (November 29, 1947) authorized a Partition Plan in this area: for an Arab and a Jewish state — and for a corpus separatum for Jerusalem. The plan was rejected by both the Arab League and the Arab-Palestinian leadership. Aided and abetted by the neighboring Arab countries, local armed Arab Palestinian forces immediately began attacking Jews, who counterattacked. On May 15, 1948, the armies of five Arab League states joined these militias in the invasion of Israel, but their armies failed in their goal of eradicating the fledgling state.

6) The armistice boundaries (1949-1967) left Israel with roughly 16.5 percent, or 8,000 sq. miles, of the original 1922 Mandate area (about 48,000 sq. miles), while about five percent — less Gaza, which was occupied by the Egyptians — was conquered and occupied in 1948 by British General Glubb Pasha, the commander of Abdullah's Arab Legion. The historic regions of "Judea and Samaria" — their official names as indicated on all British mandate maps until 1948 — were annexed and became the "West Bank" of the Hashemite Kingdom of Jordan in 1950. All the Jews were expelled from the area and from the Old City of Jerusalem; their synagogues, and even tombstones on the Mount of Olives, were destroyed.

7) Until King Hussein attacked Israel on June 6, 1967, Jordan's recognized de facto boundaries covered 83 percent of Palestine (78 percent east of the Jordan river, and five percent to the west). Following its military defeat in the Six Day War, the Hashemite Kingdom of Jordan lost the "West Bank," which it had illegally annexed 19 years earlier, retaining the huge "Transjordan" portion (78 percent) of the original League of Nations territory.

8) Of Jordan's current population of five million, about two-thirds (over three million) consider themselves "Arab Palestinians." They are the descendants either of the original Arab Palestinian inhabitants of the Trans-Jordan region, or of roughly 550,000 Arab refugees from west Palestine who lost their homes after the Arab League armies failed to eradicate Israel first in 1948, and again in 1967. Nearly two million Jordanian Bedouin citizens and others do not identify themselves as Palestinians.

9) After the 1967 disaster, an Arab League Summit Conference held in Khartoum that November reacted negatively to U.N. Security Council Resolution 247: "No peace with Israel, no recognition of Israel, no negotiations with Israel, no concessions on the questions of Palestinian national rights." This was also the determined position of the PLO. Apart from Egypt's 1981 peace treaty with Israel, there was little change, for the next two decades, in this refusal to negotiate according to U.N. Resolution 242.

10) In those "West Bank and Gaza" areas, designated by the Oslo Accords of 1994 to be placed under the administration of the Palestinian Authority (covering about 5.5 percent of the "Greater Palestine" area on both sides of the Jordan), there is now a population of over 3,200,000, of whom about 35,000 are Christians, but none are Jews.

11) The population of the Jewish state — a state envisaged in the 1922 League of Nations Mandate, and confirmed by the U.N.'s 1947 decision — is now roughly 6,500,000, of whom roughly 20 percent are Arabs (120,000 Christians), Druze, and Bedouin citizens of Israel. Of the more than five million Jewish citizens, about one-half are those Jewish refugees from Arab countries, and their descendants, who fled or left their ancient homeland when massacres, arrests, and ostracism made life impossible (a further 300,000 emigrated to Europe and the Americas, where they number over a million).

12) Today, a tiny, vulnerable Jewish remnant — scarcely 5,000 persons — remains in all the Arab world, less than half of one percent from the near million who were there in 1948 (this does not include the 50,000 in Turkey and Iran, left of about 200,000 in 1945). These are the forgotten Jewish refugees from Arab lands, from countries that will soon be totally judenrein just as Jordan has been since 1922.

13) The 22 Arab League countries cover a global surface of over six million square miles, over ten percent of the land surface on earth. Israel, by contrast, covers barely 8,000 sq. miles.

14) Security Council Resolution 242 has now become the panacea for Arab states, yet their interpretation of its key operative paragraph does not correspond to the English original, which version alone is binding. In March 2002, a Saudi "peace plan" was approved by the Arab League in Beirut, but behind it lurks the former 1981 "Fahd Plan" — with a facelift — that would leave Israel with impossible borders. After the Iraqi menace has been resolved one way or another, what is needed for the "Middle East peace process" is a concerted effort to support the Mitchell plan, which could one day lead to true peace and reconciliation for the whole region. But the Palestinian Authority will only become a genuine partner with Israel, alongside Jordan and Egypt, if there is a radical break with the past, and a new spirit of mutual acceptance prevails between the Arab world and Israel — with individual and collective security and dignity for all. This will only be feasible if democratic institutions and a respect for human rights and the rule of law become the norm, as they now are not. And it will only be feasible if the Arab world recognizes the inalienable legitimacy of Israel's existence in a part of its historical land.

— David G. Littman is a historian. Since 1986, he has been active on human-rights issues at the U.N. Commission on Human Rights in Geneva. His recent statements on this subject were made as a representative of the World Union for Progressive Judaism, a nongovernmental organization.

James Madison - 4th U.S. President Said this:

"But I go on this great republican principle, that the people will have virtue and intelligence to select men of virtue and wisdom. Is there no virtue among us? If there be not, we are in a wretched situation. No theoretical checks--no form of government can render us secure. To suppose that any form of government will secure liberty or happiness without any virtue in the people, is a chimerical idea. If there be sufficient virtue and intelligence in the community, it will be exercised in the selection of these men. So that we do not depend on their virtue, or put confidence in our rulers, but in the people who are to choose them.

James Madison - 4th U.S. President

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Who do you trust America?

I love this simply because it PISSES off Atheist's and Liberal's

What I believe as an American!

9 Principles

1. America Is Good.


2. I believe in God and He is the Center of my Life.

God “The propitious smiles of Heaven can never be expected on a nation that disregards the external rules of order and right which Heaven itself has ordained.” from George Washington’s first Inaugural address.


3. I must always try to be a more honest person than I was yesterday.

Honesty “I hope that I shall always possess firmness and virtue enough to maintain what I consider to be the most enviable of all titles, the character of an honest man.” George Washington


4. The family is sacred. My spouse and I are the ultimate authority, not the government.

Marriage/Family “It is in the love of one’s family only that heartfelt happiness is know. By a law of our nature, we cannot be happy without the endearing connections of a family.” Thomas Jefferson


5. If you break the law you pay the penalty. Justice is blind and no one is above it.

Justice “I deem one of the essential principles of our government… equal and exact justice to all men of whatever state or persuasion, religious or political.” Thomas Jefferson


6. I have a right to life, liberty and pursuit of happiness, but there is no guarantee of equal results.

Life, Liberty, & The Pursuit of Happiness “Everyone has a natural right to choose that vocation in life which he thinks most likely to give him comfortable subsistence.” Thomas Jefferson


7. I work hard for what I have and I will share it with who I want to. Government cannot force me to be charitable.

Charity “It is not everyone who asketh that deserveth charity; all however, are worth of the inquiry or the deserving may suffer.” George Washington


8. It is not un-American for me to disagree with authority or to share my personal opinion.

On your right to disagree “In a free and republican government, you cannot restrain the voice of the multitude; every man will speak as he thinks, or more properly without thinking.” George Washington


9. The government works for me. I do not answer to them, they answer to me.

Who works for whom? “I consider the people who constitute a society or a nation as the source of all authority in that nation.” Thomas Jefferson

12 Values

  • Honesty
  • Reverence
  • Hope
  • Thrift
  • Humility
  • Charity
  • Sincerity
  • Moderation
  • Hard Work
  • Courage
  • Personal Responsibility
  • Gratitude

Voter Responsibilites....Its up to you now!

Learn about Islam's Obsession with Terror!

The Warriors Creed for God and Country!

The Warriors Creed says it all about what we all should be doing for God!
I Am a Soldier
I am a soldier in the army of God.
The Lord Jesus Christ is my Commanding Officer.
The Holy Bible is my code of conduct.
Faith, Prayer, and the Word are my weapons of Warfare.
I have been taught by the Holy Spirit, trained by experience, tried by adversity, and tested by fire.
I am a volunteer in this army, and I am enlisted for eternity.
I will either retire in this Army or die in this Army; but, I will not get out, sell out, be talked out, or pushed out.
I am faithful, reliable, capable, and dependable. If my God needs me, I am there.
I am a soldier. I am not a baby.
I do not need to be pampered, petted, primed up, pumped up, picked up, or pepped up.
I am a soldier. No one has to call me, remind me, write me, visit me, entice me, or lure me.
I am a soldier. I am not a wimp.
I am in place, saluting my King, obeying His orders, praising His name, and building His kingdom!
No one has to send me flowers, gifts, food, cards, candy, or give me handouts.
I do not need to be cuddled, cradled, cared for, or catered to.
I am committed. I cannot have my feelings hurt bad enough to turn me around.
I cannot be discouraged enough to turn me aside. I cannot lose enough to cause me to quit.
When Jesus called me into this Army, I had nothing.
If I end up with nothing, I will still come out even. I will win.
My God will supply all my needs. I am more than a conqueror.
I will always triumph. I can do all things through Christ.
Devils cannot defeat me.
People cannot disillusion me.
Weather cannot weary me.
Sickness cannot stop me.
Battles cannot beat me.
Money cannot buy me.
Governments cannot silence me, and hell cannot handle me!
I am a soldier.
Even death cannot destroy me.
For when my Commander calls me from this battlefield, He will promote me to a captain.
I am a soldier, in the Army, I'm marching, claiming victory.
I will not give up.
I will not turn around.
I am a soldier, marching Heaven bound.
There are four kinds of soldiers:
1. Active Duty: Serving the Lord faithfully, daily, and on duty 24-7-365.
2. Reserve Status: Serving only when called upon, or twice a year: Christmas and Easter.
3. Guard Status: Backing up the Active Duty group.
4. AWOL! Absent With Out the Lord.
Which kind are you?
Be an army of one TRUE SOLDIER for an audience of One TRUE GOD.
surrender All to his cause!

How the Banking system works....

Are these bank collapses some sort of banking scam, or is this just part of how our banking system is operated? Do you really understand how the banking industry works in this country? Why is a run on the bank such a disaster? Hasn't the bank had to take in just as much deposits as they have out in loans? Doesn't everything more or less balance out after a bank is sold off? The news is always talking about this enormous national debt that the US owes, Who exactly is that owed to? These very educational videos will help shed some light on all these questions. If you are worried about the future of this country in light of yet another banking collapse, help yourself by understanding how our banking system works.

The Fake Stimulus plan of Obama

Based on a theory known as Keynesianism, politicians are resuscitating the notion that more government spending can stimulate an economy. This mini-documentary produced by the Center for Freedom and Prosperity Foundation examines both theory and evidence and finds that allowing politicians to spend more money is not a recipe for better economic performance.

Glenn Beck: Global Warming greatest scam in history

John Coleman, founder of The Weather Channel says global warming is the greatest scam in history.

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My Articles at Ezine Articles .com

Shocking Video Unearthed: Democrats Covering up the Fannie Mae, Freddie Mac Scam !

Timeline shows Bush, McCain warning Dems of financial and housing crisis; meltdown....The Bush Admin and Senator McCain warned repeatedly about Fanny Mae and Freddy Mac and what thus became the 2008 financial crisis -- starting in 2002 (and actually even earlier -- in the Clinton and Carter White Houses.)Democrats resisted and kept to their party line, extending loans to people who couldn't afford them -- just like you would expect of socialists.

Stimulus Package Protest - The People Speak

Join us for the Upcoming National American Tea Party - Houston, April 15, 4pm to whenever it ends - TAX DAY REVOLT. Downtown Houston across from the Post Office at 401 Franklin. Thousands will be there make sure you are! Website for upcoming protests Taxpayers from the Greater Houston region gather to protest massive government spending. Listen to their thoughts and opinions - get inspired and get involved to overturn out of control government spending.

This is what the IRS Deserves from every American.......................................

"Dear IRS, I'm sorry to inform you that I'm not going to be able to pay the taxes owed on April 15th, but all is not lost.

I paid these taxes, accounts receivable tax, building permit tax, CDL tax, corporate income tax, dog license tax, federal income tax, unemployment tax, gas tax, hunting license tax, fishing license tax, waterfowl stamp tax, inheritance tax, inventory tax, liquor tax, luxury tax, Medicare tax, city tax, school and county property tax up to 33% the last four years.

Real estate tax, Social Security tax, road use tax, toll road tax, state and city sales tax, recreational vehicle tax, sales franchise tax, state unemployment tax, federal excise tax, telephone tax, telephone federal state and local surcharge tax, telephone minimum usage surcharge tax, telephone state and local tax, utility tax, vehicle tax, registration tax, capital gains tax, lease severance tax, oil and gas assessment tax, Colorado property tax, Texas, Colorado, Wyoming, Oklahoma, Mexico sales tax and many more I can't recall and I've run out of space and money.


When you do not receive my check April 15th, just know that it was an honest mistake.

Please treat me the same as the way you've treated Congressman Charlie Rangel, Chris Dodd, Barney Frank, ex-congressman Tom Daschle and, of course, your boss, Timothy Geithner.

No penalties, no interest. PS, I'll make at least a partial payment as soon as I get my stimulus check." Ed Barnett, Wichita Falls.

About Me

My photo

Before you look at the links below know this about me, I do not know everything about anything, I know only what God has revealed to me.

Proving God exists CANNOT be done for the person who is not open to hearing and seeing the evidence as God sees it. Faith is the KEY to releasing all the evidence contained in creation, in man's heart and his mind. Without FAITH no one can ever please God so to throw away faith as unimportant destroys our receptivity to the evidence!

I was a hypocrite, a sinner and a fool, sometimes even as a believer but as long as God is in control I'm forgiven and healed of every form of human shortcoming. Nothing can stand before the evidence contained in Faith.....NOTHING!


LEARN MORE ABOUT ME AND MY MINISTRY HERE!

http://hopefromdispair.blogspot.com/

http://skepticalofskepticism.blogspot.com/

http://truthinprophecy.blogspot.com/

http://affiliatesgoldenchest.blogspot.com/

http://endwashingtonwaste.blogspot.com/

http://alltheusefulidiots.blogspot.com/
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Big Government

The Foundry: Conservative Policy News.

The Forerunner

Capitalism Magazine

A Real comparison to think about from Brian S. on Sodahead.com!!!

http://www.sodahead.com/fun/email-to-my-senators/blog-115011/

I made a comparison of the old USSR and the current state of the USA a while back and thought it was pretty interesting.

Only recently did the thought cross my mind to send the information to Washington, hope you find the information helpful.



Dear Senator _*+%$$@@#!!&***++

As there was no option for 'other' I had to choose the Deficit option.

It appears that nobody within the Washington political circles can see what is happening to this country, as they are too close to the situation.


Here is the comparison for the old USSR and USA.


The USSR

-operated a State owned Auto Industry

-operated a State owned Banking Industry

-operated a State owned Aircraft Industry

-had armed military at their airports and train stations

-made every one of its citizens keep their 'travel papers' while going from place to place.

-created the Berlin Wall, which made it next to impossible to enter without going through official checkpoints.

-had total control over the media (as other countries still maintain that control)

-collapsed not too long after their failed invasion of Afghanistan (which the US supported)



The USA

-just bailed out the Auto Industry (except for Ford) and has a large amount of stock/control over GM. Interesting because the Amtrak has been losing money continuously year after year. How can Congress think that they can help manage an Auto manufacturer?

-bailed out numerous banks with almost $1 Trillion dollars of money created out of thin air. Now, the banks are essentially 'owned' in part by the Federal Govt until the loans are paid off.

-unless I'm mistaken the Aircraft Industry has not yet gotten a bailout, but there have been talks about them wanting one

-we have armed military at some of our airports after 9-11

-the REAL ID is set to go into effect on Dec 31, 2009.

http://www.ncsl.org/realid/

(from the REAL ID web site) "Following the deadline of May 11, 2008, state driver's licenses and identification cards were not to be accepted for federal purposes unless the U.S. Department of Homeland Security (DHS) determined that a state was compliant with the REAL ID or a state had been approved for an extension by the Secretary of DHS.

All 56 U.S. jurisdictions have received an initial extension from the Secretary of the DHS. The initial extension is valid until December 31, 2009"


-the US is working to create the border between itself and Mexico with either a physical 'virtual' wall to try and slow down immigration.

I actually support this one, since our Congress cannot seem to get its act together and apparently wants to give the illegal immigrants extra rights, access to Social Security and welfare programs.


-is currently rebuilding Iraq (with tax dollars), fighting 'terrorism' in Afghanistan and crossing the border into Pakistan in a seemingly unending war.

-tried to pass a version of the 'Fairness Doctrine' which would require radio and television stations to give equal time to opposing views. As it currently stands, Conservative radio is unopposed by liberal radio stations. The Fairness Doctrine would reduce the amount of time allotted to Conservative talk shows, if not completely shut them down.

-is currently engaged in a war on drugs, yet is doing nothing about the poppy crops in Afghanistan, which is a major source of raw material in the drug war.

Maybe I'm wrong, but it appears to me that the US is on a road that is leading the wrong direction.

What we need is to reduce the overall Federal Government.

Once that starts, there will be a reduction in spending tax dollars on a useless bureaucracy.

How long is the Alarm going to ring before you wake up?

How long is the Alarm going to ring before you wake up?