POLITICAL AND ECONOMIC
by William B. Fox
3 July 2007
[Note: The editorial views expressed in this series do not necessarily
reflect those of any authors' works, web links, or organizations
listed with America First Books]
Note: In this section we examine the arguments for both
centralization and decentralization that comprise the "Y"
axis of the model discussed in the Introduction, Part 1 of this
series. I depict the diagram of the model again below:
(Third dimensional "z" axis entailing
"mutualism" vs. "parasitism"
not drawn, see discussion below)
The diagram above should also include a "z"
axis sloping backwards as in a perspective drawing to create
a cube effect, entailing the "altruist/mutualist"
vs "predator/parasite" (or "mutualism" vs.
"parasitism" for short) duality of sociobiology.
A recapitulation of my definition of "top down vs. bottom
up" from the Introduction
first at our "y" axis, the term "centralization"
usually means "more top down." It also has a loose
association with a whole garden variety of interesting terms,
such as "central planning," "headquarters-directed,"
"authoritarian," "autocratic," "conglomerated,"
"corporatized," "regimented," "militarized,"
"caesarism," "imperialist," and "fascistic."
In regard to social behavior, I even see some linkages with
terms such as "Big Brother," "alpha male control
freak baboon," and "egomaniac" for people on
the top, and "theory `x' externally-directed personalities"
and "servile" for people on the bottom.
On the other end of this management science dualilty, "decentralized"
tends to mean "more bottom up." It also has loose
but significant associations with its own garden patch of interesting
popular terms, such as "libertarian," "entrepreneur,"
"sole proprietor," "individual initiative,"
"secession," and "insubordination."
In regard to social behavior, I see linkages with terms such
as "self-actualizer," "innovator," "rugged
individualist," and "theory `y' internally directed
personalities." In regard to economics literature, I see
linkages with terms such as "free market," "laissez
faire," "Austrian economics," "entrepreneurial
infrastructure," "task organization," "matrix
management," "spontaneous order" (latter term
courtesy of nobel laureate Friedrich Hayek), and "close
to the customer," "productivity through people,"
"hands-on, value-driven," and "simple form, lean
staff" (courtesy of In
Search of Excellence authors Thomas Peters and Robert
we can intelligently discuss any political or economic ideologies,
we need to first become consciously aware of the main arguments for
both centralization and decentralization.
is part of an ongoing debate in management science. Typically the
"school solution" is that there is usually no one right
answer regarding which approach is better for an organization. It
is usually not a question of whether a group should be completely
centralized or totally decentralized, but rather the best answer
typically involves some combination of the two. Furthermore, the
right mix is usually situation-specific and dependant upon many
variables. The right mix can also change over time as an organization
grows and meets new challenges.
It is interesting how one can find examples of "decentralization"
even within the context of what appear to be highly regimented,
hierarchical, military behemoths. I can think of at least three
examples, as follows:
The U.S. military recognizes the need for decentralized decision-making
with its "task organization" concept, whereby lower level
commanders are expected to reconfigure their force structures to
adapt to new environments. For example, an infantry commander moving
through swamp terrain may need to divest his tanks and add specialty
forms of man-portable firepower, whereas another commander moving
through a desert may wish to attach additional armored and close
air support units.
2). The book Pork
Chop Hill talks about Chinese Communist leaders during
the Korean War who were "democratic to the point of recklessness"
by sharing vital secrets down to the rifle squad level. Americans
theorized that Chinese troops got a "good feeling" from
knowing secrets and that this helped them think that a battle plan
was the best possible one.
3). Military analyst William Lind describes forms of encouraged
insubordination within Adolf Hitler's armed forces in his article
WAR # 12:"
...A Third Generation
military focuses outward, on the situation, the enemy, and the
result the situation requires, not inward on process and method
(in war games in the 19th Century, German junior officers were
routinely given problems that could only be solved by disobeying
orders). Orders themselves specify the result to be achieved,
but never the method ("Auftragstaktik"). Initiative
is more important than obedience (mistakes are tolerated, so
long as they come from too much initiative rather than too little),
and it all depends on self-discipline, not imposed discipline.
The Kaiserheer and the Wehrmacht could put on great parades,
but in reality they had broken with the culture of order.
William S. Lind makes a similar point regarding the British Royal Navy in his April 10, 2007 article "Horatio Hornblower's Worst Nightmare." (part of his On War series, #213). Lind comments
. . .In the latter half of the 18th century, the Royal Navy developed and institutionalized what we now call maneuver warfare or Third Generation war. By the Napoleonic Wars, it was all there -- the outward focus, where results counted for more than following orders or the Fighting Instructions; de-centralization (Nelson was a master of mission-type orders); prizing initiative above obedience; and dependence on self-discipline (at least at the level of ship commanders and admirals) . It is often personified as the "Nelson Touch," but it typified a whole generation of officers, not just Nelson. In the 19th century, the Royal Navy lost it all and went rigid again, for reasons described in a wonderful book, Andrew Gordon's The Rules of the Game. But Hornblower's and Aubrey's navy was as fast-acting, fluid and flexible at sea as was the Kaiserheer on land.
When it comes to addressing centralization vs.
decentralization political issues in America today, we can observe
some amazing anomalies. During both the Cold War era and the current
so-called "War on Terror," most Federal politicians have
taken big government for granted. During this same period, most state-funded
universities have emphasized macro-economic theory that also takes
for granted central bank manipulation of money, markets, and credit
and massive big government intervention in the economy.
Conversely, any really serious political decentralization arguments
are treated like something whispered behind the woodshed. This is
particularly true when they entail terms such as "secessionism,"
"white separatism," "hard money," or any really
serious move back towards "State's Rights."
The idea of disbanding our central bank and taking the control of
money and credit out of the hands of politicians and private central
bankers and instead tying these things to gold and silver is typically
pooh-poohed by national media financial writers as "kooky,"
despite the fact that maintaining a gold and silver standard comprised
the dominant political platform of 19th century America populism and
Jacksonian Democracy. I have never even heard of a nationally prominent
politician call for a full-scale public audit of the privately-owned
Federal Reserve Banking System, even though this has never been done
and makes a lot of sense to responsible citizens.
Nor have I ever heard a nationally prominent politician seriously
advocate the "dual sovereignty" or the "true federalism"
concept, whereby the Federal Government must always be kept weaker than the States. This implies that States have their
own right to interpret and nullify Federal directives which are unauthorized
by the Constitution in order to defend their own sovereignty—
as well as liberty for the general public. This concept was the central
plank of Thomas Jefferson and James Madison in their Kentucky
and Virginia Resolutions of 1798, not to mention the writings
leaders such as Patrick Henry and George Mason.
Unfortunately America's centralization vs. decentralization political
debate was never finally settled on a dispassionate intellectual level.
Nor was it ever settled with the best long term interests of most
Americans in mind. Rather, it was "settled " through the
catastrophic battlefield slaughter of the War Between the States,
which left over 640,000 America's finest dead and over half the South
in total ruins.
All of this was subsequently used by special interests to somehow
justify to later generations of Americans their spin doctoring of the "King
Lincoln" dictatorship. Since then we have witnessed a relentless
trend not only towards a more perfect union, but also more perfect
big Federal government, more perfect social re-engineering at home,
more perfect foreign adventures abroad, and more perfectly burdensome
taxes and inflation.
The centralization vs. decentralization debate was also "settled"
somewhere between the Robber Baron Age and the onset of America's
intervention in World War I, when plutocratic intriguers moved in
like sharks to exploit the weeping wounds of the fractured republic
in order to lock in monopolistic special privileges for their own
narrow special interests. This included creating a privately controlled
central bank and imposing an income tax in 1913 to help finance their
global ambitions. (Please refer to my detailed discussion of Special
Privilege: How the Monetary Elite Benefit at Your Expense
by Vincent Locascio near the end of this article).
In other words, the War Between the States undermined America's immune
system. The country became deeply infected with an alien elite who
has thwarted with "viral persistency" every serious effort
in the last one hundred years to move America back towards real decentralization,
to include genuine forms of popular sovereignty on a localized level
(discussed further in my "genetic
bottom up" section). Instead, America's elite has used its
financial and media control to continually move America in the exact
opposite direction towards ever more centrism, more taxes, more liberal
media censorship, and ever bigger government. Coinciding with this
agenda we have also experienced ever more anti-national internationalism,
anti-white multiracialism, anti-Western multiculturalism, anti-Arab
pro-Zionism, and many other hideous creatures of the New World Order.
Fortunately there remains at least one vital area where America has
remained relatively unmolested on an ideological level. This involves
small to medium-sized businesses functioning within a free enterprise
system, particularly in America's heartland. It is truly amazing how
organizational theory in this realm seems to be in a completely separate
universe compared to what we hear from our big brothers in Washington,
D.C., as well as our media
masters and central
bankers in other places such as New York City and Los Angeles.
Having it both ways on Wall Street
of the most interesting live forums in America regarding centralization
vs. decentralization issues involve the mergers and acquisitions departments
of Wall Street investment banking firms. A major reason is that these
firms can make big money handling transactions that favor both viewpoints.
They tend to function more like business brokers in the heartland
than the central
bankers I alluded to earlier. Indeed, many investment banking
firms are regional entities located outside of 20th century monopoly
centers such as New York City, Washington, D.C., and Los Angeles.
Interestingly enough, arguments in this realm tend to be equally balanced
for both centralization and decentralization. I think it is worthwhile
to first examine this Wall Street world, and then make some analogies
with the political sphere. The results can be both surprising and
When it come to "top down" or centralization arguments,
investment banking firms can earn hefty advisory fees promoting mergers
and acquisitions that enable established companies to join together
to form bigger, more centralized entities. Wall Street brokers also
promote secondary stock offerings that enable established companies
to raise funds and grow that much bigger.
When it comes to the "bottom up" or decentralization arguments,
investment banking firms can also earn juicy underwriting fees promoting
initial public offerings (IPO's). These offerings raise capital for
relatively new companies, whose growth and development generally increase
competition among established companies within particular industries.
Initial public offerings also raise capital for companies that get
spun off from larger parent companies. (This, incidentally, is the
corporate analog of political "secessionism" and "separatism").
All of this tends to increase competition and undermine forms of monopoly
while supporting new sources of innovation.
investment bankers and stock brokers get pretty good at telling
investment stories that favor both centralization and decentralization.
In fact, most are talented at flip-flopping back and forth between
the two sides when the right opportunities present themselves. While
it is true that on Wall Street one can usually find both types of
activity going on at any one time, one commonly finds particular
investment professionals running fads and trends. They tend to take
one side of the story and milk it to death, and then take the other
story and run that for a while, and then back and forth and back
As a former full time stock broker, let me share with you some sample
phone-sale pitches for the "centralization" story, and
then try to make a national political analogy. For the sake of intellectual
completeness, I have also added some sleazy reasons that are quite
significant, but are typically not discussed,
or at least not over the phone with strangers.
greater economies of scale: When several companies
combine, they can eliminate redundancies in headquarters staff
and systems and cut costs. They can combine product lines and
manufacturing resources to achieve longer production runs, reduce
relative set-up time, and achieve other cost efficiencies. Large
companies can also take proven methods and implement them cookie-cooker
fashion on a broad scale.
On a national political level, when a country grows in terms of
population size and territory, it can usually become more self-sufficient
in terms of enjoying a vast internal market as well as hosting
integrated industries less dependent on foreign trade. This makes
a country less vulnerable to foreign boycotts and other intimidation
Significantly, achieving economies of scale should be an argument
for a reduction in government relative
to GDP as a country grows. For example, as America grew in the
early 1800's, government remained under 5% of GDP right up until
Despite efforts in the late 1800's to roll back a big jump in
Fed size during the War for Southern Independence, the Federal
fungus resumed an irrevocable growth trend following the creation
of the Federal Reserve Banking System in 1913 and America's entry
into World War I in 1917. Today total Federal and State government
stand at over 40% of GDP.
In looking back over the 20th century, it is more accurate to
talk about "negative" economies of scale with government
growth. I might also observe that one frequently sees negative
economies of scale (ie. reduced efficiency) among large corporations
once their management teams achieve certain levels of corruption
and cronyism. I talk more about corrupt "imperial conglomerates"
Four of my "I,
Robot Entrepreneur" series, where greater size serves
as a smokescreen for more self-dealing rather than as a tool for
greater efficiency. Quite often big corporate cultures become
more concerned with milking their product lines and manipulating
appearances rather than remaining focused on continually innovating
and manufacturing useful things for consumers, and in this kind
of climate crooked people start rising to the top.
Increase the absolute top and bottom line:
A bigger company tends to have greater revenues and profits. Greater
financial strength can be used to attract the best talent, acquire
the best plant and equipment, and access other important resources.
It can also give a few highly competent leaders the ability to
decisively mobilize massive resources more quickly that the competition.
They may also have the financial strength to decisively undercut
On a national political level, a bigger country can generally
afford a bigger army to bully or gobble up smaller rivals. It
can afford to create more monuments and infrastructure to add
to its legitimacy.
However, as Dr. Elmer Pendell observes in Why Civilizations
Self-Destruct, the underlying quality of the population
may be deteriorating as the physical manifestations of a civilization
are reaching their height.
"Synergy:" Merged companies
can spread brand name recognition and marketing expertise from
its core company products over the product lines of newly acquired
companies, thereby leveraging its distribution channels.
On a national political level, an empire can leverage itself by
absorbing lower quality peoples than its founding stock to gain
access to greater manpower and cheaper labor. An empire usually
tries to hide the fact that it may be diluting itself while it
is growing. One technique to divert attention is to create public
displays of imperial strength.
Risk reduction: A bigger company can
reduce its overall risk of going bankrupt by having many different
product lines spread across different industry segments. If one
area fails, cash flow from healthier areas can serve as a cash
cow to sustain overall operations elsewhere.
National political level: Smaller countries often try to reduce
their vulnerability to attack by forming military alliances with
neighbors. Their ruling elite may also try to diversify economically
by forming partnerships with foreign companies.
Enhance prestige: By becoming bigger,
a company can appear more "world class" to attract more
favorable financial terms and negotiate from a greater position
of strength. The fact that that a company is growing rapidly by
making acquisitions can give it the appearance of being
a "star," and hence cause the public to be more likely
to treat it like a star, even if the "excellence"
of the underlying company has more to do with public affairs trickery
National political level: America's self-anointed
leaders have been playing a desperate game to preserve global
dollar hegemony and bolster American prestige as our manufacturing
base and corresponding economy have been deteriorating out from
under us over the last few decades (see my Critical
Issues section). One example of smoke and mirrors games include
the rapid growth in the use of dangerous derivatives to cover
for the delinkage of the dollar from gold following a massive
loss in the U.S. gold supply in the 1960's. Two other examples
include the use of 9-11 to deflect attention from domestic problems
while seizing oil fields in the Middle East and hobbling enemies
of Israel, and the national media censorship of the social strife
created by massive illegal Third World immigration that undermine
the long term cohesion, tone, and innovative capabilities of America's
declining white majority.
Another good example of a political prestige game played on a
military level took place during World War II. Adolf Hitler lost
an entire army at Stalingrad for fear that if he allowed it to
retreat to save itself from encirclement, this would irreparably
damage an image of inevitable victory for his armed forces.
Increase psychic sensations of power, structure, and
control: Many leaders are addicted to power accumulation
regardless of the social consequences to others. Many thrive on
intrigue. Quite a few corporate chieftains have authoritarian
personalities and love to lord it over others. Conversely, on
the "follower" side of the equation, quite a few people
have a strong emotional need for the "security blanket"
of organizations that offer structure, a steady paycheck, and
symbols of authority and control.
The perpetual quest to make big companies ever bigger gratifies
all of these types of people as an end in itself, regardless of
whether or not growth makes sense from the viewpoint of shareholder
interests, organizational efficiency, or maintaining innovativeness.
National political analogy: The
True Believer by Eric Hoffer describes personalities
with a strong emotional need
to fanatically lose themselves in ideological quests. Many of
these kinds of people also have fetishes for the power symbols
of state authority ("statism").
of America's republican traditions, our fascist symbols are usually
not quite as obvious as the opulent palaces and triumphant arches
in Europe. However, I would nominate as one candidate the imperial
entourage of Our
Leader that was so vast, paranoid, and overbearing that it
Londoners and thoroughly angered
the Queen of England at Buckingham Palace in November 2003.
a deeper dark side to centralization
Please be aware that in the real world, the merger story is actually
much weaker than it generally appears to the public. "When
to Ally and When to Acquire" by Jeffrey H. Dyer, Prashant Kale,
and Harbir Singh in the July-August 2004 Harvard Business
Review explains the problem:
At the core of your company’s strategy
lies a dilemma, wrapped in a problem, inside a challenge. As companies
find it increasingly tougher to achieve and sustain growth, they
have placed their faith in acquisitions and alliances to boost sales,
profits, and, importantly, stock prices. That’s most evident
in developed countries. American companies, for instance, created
a titanic acquisitions and alliances wave by announcing 74,000 acquisitions
and 57,000 alliances from 1996 through 2001. During those six years,
CEOs signed, roughly, an acquisition and a partnership every hour
each day and drove up the acquisitions’ combined value to
There’s a problem, however, and it refuses to go
away. Most acquisitions and alliances fail. A few may succeed, but
acquisitions, on average, either destroy or don’t add shareholder
value, and alliances typically create very little wealth for shareholders.
Companies’ share prices fall by between 0.34% and 1% in the
ten days after they announce acquisitions, according to three recent
studies in the Strategic Management Journal. (The target
companies’ stock prices rise by 30%, on average, implying
that their shareholders take home most of the value.) Unlike wines,
acquisitions don’t get better over time. Acquiring firms experience
a wealth loss of 10% over five years after the merger completion,
according to a study in the Journal of Finance. To add
to CEOs’ woes, research suggests that 40% to 55% of alliances
break down prematurely and inflict financial damage on both partners.
When we analyzed 1,592 alliances that 200 U.S. companies had formed
between 1993 and 1997, we too found that 48% ended in failure in
less than 24 months. There’s plenty of evidence: Be it the
DaimlerChrysler merger or the Disney and Pixar alliance, collaborations
often make headlines for the wrong reasons. Clearly, companies still
don’t cope very well with either acquisitions or alliances.
There is an interesting
lesson here in regard to centralization vs. decentralization issues.
I believe that most mergers fail because they are driven by "top
down" greed factors that emphasize financial engineering. Relatively
little attention is paid to "bottom up" factors such as
developing better products and creating a climate of mutual trust
and a shared sense of ownership and purpose among co-workers.
In the long run we seem to always return to character issues. As
an example, in Part
Four of my series about the mobile robot industry I talk about
the unique success that Cisco Systems CEO John Chambers has had
in building his company through acquisitions:
Charney, who founded 3Com before it was acquired by Cisco, commented
“There are lots of people working here who could be running
their own companies — who were running their own companies.
John treats us like peers. If he treated us like employees we'd
be out of here.” According to Chambers, “A large part
of our business is based upon trust and working together. Nothing
changes behavior like survival.” It’s
no longer the big that beats the small, but the fast that beats
the slow.” “You want to beat your competition, but
you want everyone to win.” Chambers insists on staying
extremely close to the market. He said, “At IBM and Wang [where
Chambers worked before taking over Cisco], we fell in love with
technologies and paid
a terrible price.”
Jim Clark, who has founded three Silicon Valley
companies with market caps over $1 billion, has echoed
John Chambers, “A leader must always strive to get the very,
very best people — people who threaten you because they’re
smarter than you. You also have to make sure you don’t have
high turnover. I have a rule: Never lose the first good person.”
This approach is all
well and good, but it typically requires leadership skills, emotional
maturity, a long term time horizon, and a sense of caretakership
towards American society.
In contrast, the financial engineering game is very seductive because
it provides a relatively quick and easy route to big bucks. The
reader might find it instructive for me to detail how the game works,
as discussed below:
a company tries to get a relatively high P/E
multiple to its stock by keeping up appearances and figuring
out hot growth stories that will resonate with the public. It may
even hire public relations firms to hype its story to stockbrokers
and the general public.
Once its stock is up, the management starts going on a hunting spree
to acquire companies with relatively low price to earning multiples,
but whose corporate story can somehow be spin-doctored to sound
like part of an intelligent acquisition strategy.
This tactic alone can serve as a hat trick to convert a fluff company
into one with real cash flow while defrauding the public. When an
entrepreneur with a fluff story can parlay his overvalued stock
to acquire control of a company with real earnings, now he has acquired
a source of real cash flow to sustain operations. Conversely, if
he fails to parlay his fluff stock, his company might eventually
implode in bankruptcy. Some extreme examples of all of this took
place in the late 1990's, when start-up Internet and Telecom companies
with no earnings and stratospheric stock prices started to parlay
their stocks for ownership in real "brick and mortar"
businesses with real earnings. As one example, the AOL merger with
Time-Warner drew heavy criticism for looking like an emergency duck
for cover as the Internet story began to fray at the edges.
Usually companies with low P/E multiples have slower growth potential.
When a company with a "hot growth" story and a high P/E
multiple acquires slow growth companies with low P/E multiples,
the overall stock P/E multiple should drop, and the stock price
should languish as well.
But this is usually not what happens. Instead, the acquiring company
usually achieves a "financially engineered" boost
to its earnings. One reason for this is that Wall Street analysts
have a tendency to stay with hot growth stories that justify high
P/E multiples. They are reluctant to alienate companies who might
become good clients for the mergers and acquisitions departments
of their firms. This in turn enables acquiring companies to continue
using their overpriced stocks to buy companies with undervalued
stocks and "cheap" earning. All of this in turn continues
to steadily increase the earnings reported on income statements,
even though the earnings growth is purchased with the overpriced
stock offered in acquisition deals, and hence is "financial
engineered" rather than reflecting increased sales of real
and useful products.
The public never seems to learn. Part of the reason is that quite
a few investors simply do not care. Much of Wall Street is driven
by hot speculative investors who could care less about fundamentals
as long as they can eventually offload their overpriced stock on
The game usually continues until management can no longer hide serious
underlying problems. Until this fateful day, insiders continue to
acquire more stock options and keep carving out ever higher salaries
from their growing revenue and asset base. Before reality intrudes,
they and their friends on Wall Street hope they can find ways to
convert major portions of their holdings into cash in the bank.
Then comes the news announcement that breaks the golden growth story.
The stock crashes. The management holds a press conference where
it blames the problems on everything except themselves. After the
phony contrition, management affects confidence in its bold new
"turnaround" plan. Then Wall Street analysts eventually
return to curry more favor by selling the "turnaround story"
to the public. Even turnaround companies can bring good business
to their corporate finance departments.
problem with this game is that no real wealth or productivity gains
are being created for American society. It is all about leveraging
prestige, shuffling paper, and milking public credulity rather than
steadily innovating and producing real products that offer a genuine
"value proposition" to the public.
We can compare all of this with the approach of 19th century industrialists
such as Henry Ford and Thomas Edison who focused upon improving
technology, automation, and the quality of products. They took great
pride in converting a share of their steadily increasing productivity
into steadily rising real wages for American workers. I discuss
Henry Ford's approach further in my Preface
Life and Work. This book reflects the kinds of values that
once built America.
Incidentally, I do not mean to imply that these earlier American
leaders did not occasionally cut some corners or run into significant
problems. Thomas Edison told his investors that he had already invented
the light bulb in order to raise the money he needed before he went
ahead and invented it. He also got into a nasty
fight with another genius named Nikola Tesla when Tesla was
right about superiority of AC current systems in electrifying America
compared to Edison's DC approach. In regard to Henry Ford, he went
with his first company before he founded the Ford Motor Company
and subsequently became one of the wealthiest men in America.
Despite all their problems and imperfections, these kinds of men
were still giants compared to American business leaders today who
are at least a quantum level down the totem pole in their ability
to deliver on their promises and serve America's interests while
"Natural" vs "Dictated" Politics
"The greater the state, the more wrong and cruel its patriotism, and the greater is the sum of suffering upon which its power is founded." – Leo Tolstoy
"The State is the great fiction through which everybody endeavors to live at the expense of everybody else." Frederic Bastiat
There is an interesting tie-in between the concept of "natural" and the term "decentralization." Similarly, we can associate "dictated" with the term "centralization."
Later in this article I will explain how this "natural" vs. "dictated" conceptual dichotomy applies to our analysis of monetary systems, economics, and religion.
First let me explain what I mean by "natural." Things that are "natural" tend to spontaneously and informally evolve on a grass roots level and stand the test of time over many generations. It tends to have an informal and familial flavor to it that involves direct personal contact, leadership by personal example, and an emphasis on voluntary cooperation.
In contrast, things that are "dictated" often involve a select few people at the highest levels of power who like to use force, deception, and various props of power to serve their own selfish interests and bend people away what they would ordinarily do for themselves under "natural" circumstances.
In my mutualism vs. parasitism discussion, I describe how one can often discern vague elements of "democracy" (ie. a system designed to utilize constructive suggestions from many sources to make policy decisions) and "republicanism" (a system designed to prevent arbitrary and irrational rule) in small village settings of tribal societies around the world.
This is because in a small village where everyone knows everyone else pretty well, it is fairly easy for representative people to get together in a large room and informally hash out their complaints and concerns. Village gossip also provides a constraint on bad behavior as well as an important way to keep people informed on what is really going on. It is also much easier to settle grievances in a one-to-one manner with anyone within a small village. A small village is generally a much more informal and "natural" environment than a political or economic power center in a big city. Lastly, villages tend to be racially and ethnically homogeneous. Local customs and traditions are usually adequate to ensure good behaivor without having to resort to police state strong arm tactics. Within such a village one can also have the feeling of an extended family. The people in charge are more likely to have a geniune sense of long term caretakership and a strongly felt emotional sentiment for the welfare of everyone else.
In contrast, once we scale up to the level of a territory that encompasses vast numbers of villages, the common people are usually not able to meet with their rulers face to face, know what is really going on, or settle scores with the people in power. The rulers can hide behind professional propagandists, bureaucrats, military strong-arm men, and ritualistic protocols. It is much easier for rulers to find ways to abuse their power to serve their selfish ends and then cover up their misdeeds before the public.
Lastly, it is fairly common for the people who control large nations or empires to have very little common on a racial or ethnic level with most of the underlying population, and therefore have very little emotional investment in looking out for their long term welfare. Worse yet, the power game tends to attract psychopathic personalities who are indeed more cold-bloodedly "unnatural" and sinisterly manipulative than the common man.
Here, we see how as government grows and encompasses more villages and becomes vastly larger and more pyramidal in structure, it tends to become much more formal, arbitrary, dictatorial --and vastly more "unnatural." It is fairly common everywhere you go around the world to hear the man on the street complain that the politicians on a national level frequently seem to act like clowns or evil characteritures of their own people, far removed from their concerns.
Three fairly dramatic examples come immediately to mind. The democratic flavor of the small Russian village councils (or "soviets") was completely turned on its head under the brutal "Soviet" dictatorships of Lenin, Trotsky, and Stalin. The nationally televised "town hall meetings" conducted by recent U.S. Government administrations are a complete farce compared to town hall meetings that were once held in small towns in early America. In its actual policies, the Bush regime slavishly follows the will of the Jewish lobby and other special interests while thumbing its nose at the will of the majority of Americans. Among other things, the majority of Americans oppose open borders with Mexico and want immediate withdrawal from Iraq. Lastly, Israel is effectively run as an authoritarian secret police state by the Mossad. It starts wars and promulgates international intrigues at its own pleasure. Certain observers believe that it even murders its own people such as former Prime Minister Yitzhak Rabin in internal gangster turf battles. It also tries to kill U.S. Presidents. (Please see details regarding Rabin, JFK, and reported attempts on Harry Truman and George H. W. Bush in Michael Collins Piper's Final Judgment). All of this has very little to do with a sense of broad-based group concensus, familial give-and-take, and a sense of humanity that Israelis would tend to more closely associate with life on a kibbutz or many Jewish idealists associated with the founding of the Jewish state.
The "natural" politics concept has tie-ins with many "thought problem" paradigms created by famous political and economic theorists. For example, the French philosopher Jean Jacques Rousseau talked man in the "state of nature." The basic idea is that when people accept a government over them, they engage in a "social contract" whereby they expect the benefits of such a government to compensate for the rights and taxes that they give up. A government should certainly offer them something better than what they had in a "state of nature" with no central government at all.
In "Austrian" or "laissez faire" economics, libertarian theorists such as the late Dr. Murray Rothbard like to start out with "Robinson Crusoe" thought problems, and then build their economic theory upwards from this grass roots level. Austrian economists like to show how as one adds more government, one typically adds more layers of "special privilege" which in turn tends to create layers of economic distortion, disinformation, and dysfunction compared to a pure, laissez faire free enterprise economy.
In his lectures on the evolution of classical liberalism, Dr. Ralph Raico has discussed how French libertarian economists of the 18th and 19th centuries associated entrepreneurs, craftsmen, farmers, and industrialists with the "wealth-creating," "tax-producing," and "productive" classes, and conversely associated central government, a standing military, and idle monks with the "tax-eating," "wealth-consuming," and essentially "nonproductive" classes. According to Dr. Raico, certain libertarian economists condemned industrialists as corrupt and nonproductive once they crossed the line and started to depend on forms of government subsidy. In libertarian theory, government is based on force, coercion, and politics. Rather than protect the citizenry, over time it tends to grow on its own accord like a cancer and infringe on private property rights and systems of voluntary exchange that tend to exist on a more natural level.
One problem with the "state of nature" analysis offered by most modern liberals is that they tend to overly generalize. We know from vast volumes of anthropological field research that the "state of nature" varies widely around the planet for different peoples based on racial, cultural, historical, and physical environmental factors. At one extreme, the relatively homogeneous, traditional (or "folkish") Nordic-Celtic society of Iceland was once based on highly literate, economically self-sufficient, self-motivated family homestead units that functioned extremely well for centuries with almost no central government by contemporary American standards. The central government in the Middle Ages consisted of relatively informal meetings held on Parliament Plains (Thingvellir) once a year. At the other extreme, in other parts of the world we can find various peoples who can barely even function as low-level savages. They run around naked, eat each other, tend to be lazy, routinely lie to each other, have almost no sense of personal property rights, and otherwise tend to act like morons in the absence of all-powerful, cruel tribal chieftains forever looking over their shoulders.
Appearance manipulation vs. the grass
roots in the higher political sphere
As mentioned previously, when a government acquires more territory,
it can usually collect more taxes, sustain a larger military, and
pay higher salaries and perks for government executives. It can
also afford to erect more monuments to itself and create other prestigious
symbols that enhance an appearance of legitimacy, giving it more
leverage with jingoist patriots at home and toadies abroad.
When a government expends too many resources playing the prestige
game, that can be a bad sign that insiders are more interested in
building their own power base using leveraging techniques than in
genuinely serving the people.
I think that we need to distinguish between the often laborious
but honest long term-oriented grass roots methods used by honest
populist politicians to build solid political constituencies —
and represent their interests — and the largely dishonest
short cuts unfortunately used by most politicians in America today.
Using a business analogy, the honest way to build a business is
to invest considerable time and effort towards developing an original
business plan that offers a solid "value proposition"
for a viable market. The execution phase of the business plan may
also entail considerable time effort involving everything from perfecting
production of the actual product to fine-tuning all the functional
areas of the organization.
The laborious but honest way to create a political constituency
is build it on the grass roots level. This can mean going door-to-door
as well as networking with influential people and organizations
in ones local community. When people are ignorant about tough issues,
the honest politician tries to educate them rather than hide from
these issues. This entire process may require far more work than
a particular campaign season prior to an election. In fact, an aspiring
office holder may require many years to build the necessary support
I think that Dr. David Duke's book My
Awakening provides an extreme example of someone who fought a long
and ultimately successful uphill battle against America's prevailing national media and political establishment to build a solid grass roots
support base within his districts in Louisiana.
As one of the most heavily demonized individuals in America on account of his blunt criticism of Jewish supremacism and U.S. Government racial policies, Dr. Duke faced vicious
opposition. The very
hostile national media included the Jewish-owned Times-Picayune of New Orleans. As Dr. Duke observed in his book, the controlled
media routinely attacks any whites who dare to defend their
own genetic interests, although it has always pursued the exact
opposite policy towards Jews and Israel. Despite the smear campaigns,
Dr. Duke was elected Louisiana State Representative in 1989. Even pre-election polling
failed to predict his upset election success, causing Dr. Duke to
quip "I fly below radar."
Similarly, the British National Party has been scoring successes
at the grass roots level despite hostile national media and strong
opposition from the current British political establishment. The
same holds true for the National Front in France. Like the David
Duke campaigns, these are not "normal" election campaigns.
They require tremendous long term effort invested on a grass roots
level to wake the electorate out of their racially suicidal apathy.
Polls show that most whites oppose massive illegal immigration,
but despite this their establishment leaders typically typically
run roughshod over their sentiments.
As a disclaimer, I am providing these rightist examples from a broad
ideological perspective. Behind the scenes, certain individuals
from any part of the political spectrum may or may not
measure up to the implied nobility of their public
cause. This is a separate character issue that voters should investigate
on their own.
Taking the short term path of least resistance
The short cut in the political process is for a politician to ingratiate
himself with the media moguls and other big money people. Once they
decide to use him, they will hire the PR professionals who figure
out the best ways to "package" him. They will give him
the air time he needs with just the right "spin" to win
under "normal" election circumstances where most people
are apathetic and do not spend much time learning the names of their
elected officials, much less the issues they represent. If there
is electronic voting, they may even "fix" that as well.
In fact, there is considerable evidence that our last two presidential
elections were fixed.
We know that about 50%-75% of the funding for the Democratic Party
and somewhere over 25%-50% for the Republican Party has come from
the Jewish lobby in recent decades. In They
Dare to Speak Out, former Congressman Paul Findley talks
about how all U.S. Presidential candidates get routinely interviewed
by Jewish groups and must pass their kosher test to stay on the
nomination tickets of both the Democratic and Republican parties.
Hence, once a politician goes down the road of becoming a bought
candidate, he can forget about seriously criticizing Israel, AIPAC,
the Mossad, or any other Jewish supremacist groups. He can also
forget about criticizing various bloated Federal bureaucracies or
getting the real truth out about 9-11, out of control Third World
immigration, depleted uranium, or a host of other issues that I
address in my Critical
This is not to say that a bought politician will never be able to
talk about any of these issues. However, if he decides to address
them, he will always feel compelled consult with certain "handlers"
to make sure his statements are spin-doctored in the right way if
he wishes to remain in office.
In other words, he will always be "controlled opposition."
When he addresses tough issues, it will usually be as a "limited
hang-out," where he covers perhaps 70% of the truth, but leaves
lies through omission with the remaining 30%.
At the 2005 European American Conference in New Orleans, Dr. Duke
said that the Achilles Heel of the American political system from
the standpoint of America's corrupt, ruling elite is the grass
roots. As much money as they have — and they do have a lot — they still do not have enough money, manpower,
and influence to buy the hearts and minds of folks on the local
city and state government level in the face of highly persistent and determined grass roots organizers.
As another important note, I would point out that successful guerilla
warfare practitioners throughout history have had to spend considerable
time and energy engaged in grass roots political organization and
education even while they are engaged in military operations. The
requirement to do this never goes away. It is just that once an
insurgency erupts, this process only becomes that much more dirty
and dangerous. Therefore, individuals who read fictionalized accounts
of future conflict in America and have fantasies that everything
will get satisfactorily resolved at the point of a gun are sadly
mistaken. While I strongly encourage citizen self-defense and staunchly
support the right to keep and bear arms, I think that people who
stock up on guns and ammo and do nothing else to address our growing social problems are a pathetic bunch.
No matter what happens, grass roots political organizing is the
way to go. Better to successfully do it now under relatively peaceful
conditions than to continually sweep hard issues under the rug and
wait for social conditions to reach the boiling point. Mass social
violence is a very ugly thing filled with tragic unintended consequences.
No responsible person in their right mind would deliberately want
to engage in violence while peaceful means remain an option —
so get to work peacefully organizing and spreading the word now!
A Soviet story
In his book The
Liberators: My Life in the Soviet Army, Viktor Suvorov presents
one of the best anecdotal stories I have ever heard about how large
bureaucracies and highly centralized political systems can become
completely detached from reality. According to an Amazon Customer
author, Suvorov, entered the Soviet Army through unbelievable circumstances.
The workers of chemical combines were ordered to transport huge
quantities of fertilizer to make a record harvest for the glorious
Ukraine SSR. However, the truck-drivers ordered to transport this
fertilizer (one of whom being the author) were unable to meet the
impossible 24 hour time quota! The men in charge of this operation
had no idea how to deliver all this fertilizer, so they told the
drivers to just get rid of it. The drivers dumped the chemical fertilizer
into the river, creating a horrible yellow, stinking stain. Once
returning to town after a day of dumping fertilizer into the Dnieper,
Suvorov realized that he still had a ton and a half left in his
tank. Without thinking, he dumped the cargo onto his private lot,
completely destroying it. With the fear of starvation looming, Suvorov
was forced to join the Tank School in Kiev, setting a series of
tales of the sort into motion.
the Wall Street merger story gets milked to death, now it is time
to reverse gears and pitch the decentralization story. Here are
some key sales points, combined once again with some national political
companies tend to be much more innovative: Small
companies are more likely to attract self-motivated people with
visionary, flexible, innovative, decisive, and entrepreneurial
personalities. In contrast, big corporations tend to become grazing
grounds for risk-averse, politically-sensitive, bureaucratic personalities
who prefer highly structured environments. In fact, it is very
common for large natural resource companies to buy their mining
discoveries and other natural resource properties from junior
companies. One also frequently sees large technology companies
buy most of their innovative new product lines from small entrepreneurial
Recognizing that smaller companies tend to grow faster and be
more innovative, sometimes big companies will deliberately spin-off
pieces of themselves to form new companies centered around certain
product lines. Officers of the parent companies often obtain shares
in the new spin-off companies as an incentive to carry out the
divestitures. The Thermo Electron companies, Tektronix, and Hewlett
Packard are examples of companies that have been major sources
of spin-offs. In the case of Thermo-Electron, systematically creating
spin-offs has been a conscious feature of the business plan.
On a national political level, the innovative output per capita
of the tiny Greek City states of the heroic and classical periods
dwarfed the accomplishments the Greek Empire of Alexander's Ptolemaic
successors or the Roman Empire at its height. The small northern
Italian states of the Renaissance dwarfed the innovative output
of the united Italy that came later. Tiny quasi-Odinist Iceland
as a medieval offshoot of Norway dwarfed the literary and intellectual
output of the rest of Christianized and consolidated Scandinavia.
A few renegade colonies at the time of Thomas Jefferson and Benjamin
Franklin dwarfed the innovative output per capita of the rest
of the British Empire. Similarly the young American, Roman, Grecian,
Swiss, Renaissance Italian, and Dutch republics seemed to foster
a vastly greater level of innovative social and political thinking
than their mature forms a couple of centuries later.
Some political spin off examples include the way Great Britain
peacefully divested Canada, New Zealand, and Australia beginning
in the late 19th century. Despite their greater autonomy, these
"children" paid back dividends through favorable trade
relations. They also provided troops during the World Wars.
Spin-offs and secessionism are by no means irrevocable; for example,
Scotland has been both united and disunited back and forth with
England many times. Norway has been both united and disunited
with Denmark. Neither unification nor secessionism are necessarily
things that are worth fighting bloody wars over one way or the
I personally believe that among whites, Nordic and Celtic peoples
in particular have strong innate libertarian tendencies and function
better in smaller countries than in big empires. Later in my libertarian
racial nationalist discussion I delve into the idea that the U.S.
Constitution should have have contained pre-programmed spin-off
provisions similar to the Thermo Electron business plan. That
way we would have avoided the War Between the States and numerous
incredibly wasteful overseas imperial adventures. We would have
also avoided a one-size-fits all monetary policy under the sinister
Federal Reserve Banking System and the growth of the high taxation,
Zionist-dominated, open borders, big Federal Government police
Let us be very generous.
Let us imagine for the sake of argument that the U.S. Government
today could be characterized as a fair, noble, wise, efficient,
and benevolent entity. Let us also try to imagine that it actually
does more good than harm. Even in view of all of this, on basic
principle, I would still advocate seriously exploring the idea
of peacefully divesting portions of America with separate currencies,
military forces, border control, and other instruments of local
sovereignty. On balance, increasing political decentralization
is a good thing.
Simple Form, Lean Staff (this phrase
In Search of Excellence): Small companies tend to
have fewer layers of management to slow down decision-making.
They tend to be less encumbered by rank, formalities, and protocols.
They also tend to have smaller staffs, whose members tend to know
each other better and work more cohesively. Corporate leaders
are more likely to take responsibility and show initiative than
engage in bureaucratic blame and responsibility-shifting games.
In short, small companies tend to be vastly more flexible, efficient,
and responsive compared to large companies.
On a national political level, the start-up U.S. government back
in the early 1800's was more likely to leave citizens alone and
not tax them, and that in itself says a lot. It showed greater
concern for its "product quality" as a "service
business" by keeping itself much better constrained within
its charter, namely the Articles of Confederation, Constitution,
and Bill of Rights.
Better focus: Small companies tend to
have fewer product lines, which can mean better management focus
in areas of core competency. This can also imply greater closeness
to the customer.
On a national political level, smaller countries tend to have
fewer layers of government and tend to be more responsive to local
needs. They tend to be less interested in changing the world with
imperial adventures and are more focused on internal affairs.
Although the aggressiveness of Israel today would seem to comprise
a major exception to this observation, actually it is not. AIPAC
and other Jewish organizations control the U.S. Government. Jewish
interests exert imperial power elsewhere in international finance.
The state of Israel is merely the tip of a uniquely international
Greater Transparency: Small companies
tend to be less complex than large corporations, and easier to
monitor. With fewer product lines and layers of management, it
is easier to connect management performance with business results.
In contrast, CEO's of large companies often like to increase the
size and complexity of their organizations to hide their incompetence.
In his 15
Oct 2001 Forbes column, Kenneth
L. Fisher provided a classic example: "So what does [the
new Hewlett Packard CEO Carly] Fiorina do two days after the [HP]
stock hits a five-year low? Announce that HP is acquiring Compaq
Computer for $25 billion. For Fiorina's career this deal is a
time-buying smokescreen. Now no one ever will be able to see if
she accomplished anything fundamental for at least several more
years. The time and energy spent integrating Compaq will take
center stage and obscure her past mistakes at HP."
National political example: In terms of the level of integrity,
accountability, and efficiency in government, the best experiences
Americans ever had was during the colonial period and the first
decades of the young republic. Never has government done so much
with so little in term of serving the direct interests of its
constituents. In terms of helping to increase their land base,
defending liberty, and dealing with their direct enemies (hostile
Indians and French and British imperialists), it is hard to beat
a track record that includes throwing off the yoke of the greatest
maritime empire on the planet and extending the settleable land
base from the eastern seaboard all the way to the Pacific.
Conversely the worst governments Americans have ever had has been
in the last one hundred years. The era of big government has been
characterized by obnoxiously invasive social reengineering programs
at home, continual destruction of the value of the currency, and
incredibly wasteful, pointless, and destructive adventures overseas.
Greater stakeholdership: Small company
managers tend tend to have proportionately large share positions
in their companies. They also tend to have more pride and ego
invested in the success of their companies, particularly when
they are inventor-entrepreneurs. In contrast, the professional
managements of big companies are more likely game the system to
carve out perks for themselves regardless of underlying corporate
National political example: In his excellent book Democracy:
The God that Failed., Dr. Hans-Hermann Hoppe describes
how it is critically important that a nation's leaders have a
sense of long term caretakership. Unfortunately certain types
of social democracy can incentivize politicians to focus on creating
regulations and spending public money to make names for themselves
in the short term, even though all of this may grow disastrously
out of control over the long run. As countries become ever larger
and filled with increasingly disparate factions, this irresponsible
behavior tends to only grow worse. I discuss his anarcho-libertarian
perspective in greater detail later in this article.
From the libertarian racial nationalist perspective, small countries
imply more homogeneous populations whose leaders tend to identify
more with the common citizenry. This helps to provide a greater
sense of stakeholdership and longer term perspective towards serving
Small companies help keep big companies honest.
In addition to providing product competition, they can threaten
to hire talented people away from large firms. Dr. Murray Rothbard
observed in one of his Mises Institute lectures that the most
practical threat to achieve real wage increases is not a union
strike, but the ability of employees to jump ship to higher paying jobs elsewhere.
(The political analog is what libertarian professor Dr.
Ralph Raico calls "preserving the right of exit"
in defense of liberty). In fact, small businesses create most
of the new jobs in America. In the real world, it is impossible
to have a fair contractual negotiation if neither party is free
to pick up its marbles and go elsewhere.
National political example: In his Mises Institute lectures, Dr.
Ralph Raico claims that the break up of Europe following the collapse
of the Roman Empire aided the cause of liberty. With the existence
of more competing states and principalities, if rulers became
abusive, it was much easier for their most productive people to
pick up and move elsewhere. One of the best deterrents to tyranny
is the ability of people to split from the program as either individual
separatists or as national secessionists.
In fact, this was a belief explicitly stated by Thomas Jefferson
in his Kentucky Resolutions of 1798.
deeper dark side here too
Unfortunately, in the last few decades America has shifted towards
a much more short-term focused, immediate gratification society.
This sad trend, described in American
Values Decline (carried by America First Books) has infected
all strata of our society and all regions of the country. From my
own personal experience in the business world, I have observed how
quite a few small business leaders suffer from the same generalized
greed disease as their big corporate counterparts. The games they
play may be a little different, but the end results in terms of
defrauding the general public are very much the same.
While it is true that small companies create most of the new jobs
and innovation in America, it is also true that one of the easiest
and most lucrative forms of robbery in America involves posturing
as a small start up company entrepreneur and selling investment
stories to the public that consist of promises without intent to
deliver. After raking in tens of millions of dollars in cold cash
with public offerings, the wily small business operator can start
paying big chunks of all that to himself with a high salary. He
can also cash in on ample stock options given to himself that exploit
his company's market capitalization. There are millions of ways
he can artfully word his Red Herrings, form 10-Ks, and other public
disclosure statements so that disgruntled investors several years
down the line will never able to get back at him in court for lying
through his teeth.
The best defense against this behavior is "buyer beware."
While working as a stock broker, my best defense was to personally attend trade shows and corporate offices. This enabled me to meet corporate leaders face-to-face to find out important information frequently ommitted from public documents. It was particularly
helpful to speak directly with competitors and other peers within
an industry sector of interest, and then perform my own analyses
of company disclosure documents.
I found most analyst research put out by most major Wall Street
firms to be so filtered and shopworn as to be practically worthless.
This basically confirmed Peter Lynch's viewpoint in his classic
Up on Wall Street about the need to do ones own grass roots
I do not think government is capable of solving this problem with
more regulation and oversight. For starters, our corrupt government
in Washington, D.C. is hardly immune from the greed and dishonesty that has infected
the rest of our society. Treating it like a white knight is like asking the blind to lead the blind.
Secondly, free markets are so vital
for the effective functioning of whatever is left in our economy
that we dare not tamper with them in any way.
Later in this article I discuss some libertarian views on this problem
in more detail.
Compulsion vs. Contract
Another interesting way to view the top down
vs. bottom up debate involves examining the ethical character of
Top down theorists tend to focus on duty-based ethical viewpoints,
whereas bottom up, libertarian thinkers tend to overweight contractual
ethical systems, followed by utilitarianism.
The so-called "Founding Fathers" of America were very contractual in their thinking.
I think that it is very important to examine the deeper meaning
of their "contractualism."
As some background on the differences between these ethical approaches,
many ethical scholars have divided ethics into three broad categories:
a) Duty based: The quality of ethics
are judged according to the ability to conform to authority figures
and carry out specific tasks.
b) Contractual: Ethics are judged by the ability
of people to live up to their contracts
c) Utilitarian: The quality of ethics are based
upon a cost-benefit analysis of the results of the behavior.
I discuss each ethical approach in greater detail
Six of my series on the mobile robotics revolution where I evaluate
the ethical limitations of Isaac Asimov's three rules for supposedly
fail-safe robot behavior based upon a scenario portrayed in the
movie I, Robot. Suffice to say for here
that typically there is no one approach to ethics that has all the
answers, but rather the best solutions typically come from analyzing
a particular ethical issue from all three viewpoints simultaneously.
Duty-based ethics are attractive to large organizations
with pyramidal organization charts. By their very nature, these
types of organizations tend to be filled with functional specialists.
Each layer of management tends to focus upon defining and supervising
the execution of specific tasks for each layer underneath it, all
the way down the chain of command.
In contrast, a contractual ethical orientation tends to have a better
fit for people who work within small companies. People are more
likely to interact on an informal level where they establish "unwritten
rules" for getting along. Their jobs more frequently overlap,
and they are more likely to operate like "Jacks of All Trades"
where initiative and independent analytical abilities are more highly
valued. They tend to be evaluated more on their ability to act in
"good faith" according to broad contractual expectations
as compared to their ability to fulfill very specifically defined
cookie-cutter duties. In many limited partnerships and professional
corporations people are in fact legally defined as independent contractors
where they frequently renegotiate their terms and conditions for
doing business as they go along.
Back when America was a young republic, most Americans were clearly
much more contractual in their political thinking than Americans
today. The Articles of Confederation and U.S. Constitution are in
essence nothing more than contracts. None of the Founding Fathers
ever advocated treating them like holy documents. In fact, even
George Washington, who was more authoritarian and statist than Thomas
Jefferson, talked in his 1796 Farewell Address about
"....This Government, the offspring of our own choice, uninfluenced
and unawed, adopted upon full investigation and mature deliberation..."
An important libertarian point I will repeat later in this series
is that the U.S. Constitution and Articles of Confederation were
about constraints on government, not legal
limitations on citizens.
Americans did not need any government to
help them be free. They were already free without the creation of a central government and were determined to keep it that way. A classic example was Watauga Association at Sycamore Shoals in eastern Tennessee during the 1770's and 1780's that supplied the Overmountain man militia that helped win the Battle of King's Mountain. It practiced grass roots democracy and had most of the sovereignty features of an independent country. Most pioneer communities in early American functioned very well on their own and had no need for central government, except in rare instances to help deal with major military threats posed by Indian confederacies or by French, Spanish, Mexican, or British troops. .
Thomas Jefferson once observed that "When the people fear their government, there is tyranny;
when the government fears the people, there is liberty."
One can sense this grass roots freedom by reading historical accounts that continue through the creation of the Texas Lone Star Republic, the California Grizzly Bear Republic, and the first provisional government of Oregon created in 1843. Americans
handled most government functions on a local level. Most of them
owned their own farms where they worked as their own task masters.
By contemporary standards, life was hard. This helped to condition them
to not expect life to be easy and to be braver in defense of liberty.
Americans were more likely to form their own opinions based upon
their own common sense and their own direct experiences. The most
sophisticated propaganda they were subjected to came from their
Bibles and local religious ministers. Newspaper media in America
was very decentralized compared to the programming disseminated
today by Jewish supremacists and their bought-and-paid-for professional propagandists in New York City and Los Angeles
who monitor nationwide television viewing habits almost by the hour.
Clear duty-based vs. contractual fault lines in British
In 1884 Herbert Spencer published an famous article titled "The
New Toryism" which applied this duty based vs. contractual
line of social analysis to British society.
In the early 19th century British Whigs, who were also known as
old Liberals, were known as the party of contract. They tended to
be very libertarian. They were particularly prevalent among tradesmen
and entrepreneurs of the Industrial Revolution, who obviously needed
elbow room to do business deals. Their emerging businesses benefited
from minimal state taxation and regulation.
In contrast, the Tories were known as the party of duty. They were
overly represented by landed interests and old feudal relationships.
They sought to protect special privilege.
In his essay, Herbert Spencer quotes Bolybrooke, who characterized
Whigs and Tories as follows:
"The power and majesty of the people, an
original contract, the authority and independency of Parliaments,
liberty, resistance, exclusion, abdication, deposition; these were
ideas associated, at that time, to the idea of a Whig, and supposed
by every Whig to be incommunicable, and inconsistent with the idea
of a Tory.
"Divine, hereditary, indefeasible right, lineal
succession, passive-obedience, prerogative, non-resistance, slavery,
nay, and sometimes popery too, were associated in many minds to
the idea of a Tory, and deemed incommunicable and inconsistent,
in the same manner, with the idea of a Whig." Dissertation
on Parties, p. 5 [1735, p. 4].
Herbert Spencer points out an important irony
that was taking place after the mid 1800's. The Whigs, now known
as Liberals, were passing lots of social legislation. The topics
included compulsory education, working hours, business competition,
working conditions, housing, electric lighting rates, and so on
Spencer observed that now that Liberals were piling on more and
more government laws and regulations, they were giving individual
liberty the slow death of a thousand knife cuts. They were effectively
creating the same climate of government-sponsored coercion that
they had opposed in the Tories decades earlier. The fact that the
liberals felt they had good intentions or a better social purpose
did not matter in the final analysis. To Spencer, too much state-sponsored
coercion that regimented society was bad no matter how it was motivated.
Hence, "The New Toryism."
Incidentally, Dr. Paul Craig Roberts has updated us on Spencer's
theme in his excellent book The
Tyranny of Good Intentions.
In America, Whigs were morphing into another dangerous species of
compulsive animal. American Whigs aggressively sought special privilege
through such government programs as protectionism, public works,
and a central bank. One of their main champions was Abraham Lincoln,
who I will discuss in greater detail later.
The irony here is that as that once American Whigs gained their
special privileges, they now achieved government police power backing
for their industrial products just like the way old Tories in England
demanded government backing for their landed interests.
The War Between the States might be viewed as a conflict between
America's "New Tories" consisting of Northern industrialists
who demanded state support for their high tariff program, fighting
it out with Southern-style "Old Tories," consisting of
a landed planter class wishing to preserve their slave-holding privileges.
All of this was a departure from genuine classical liberal principles
asserted by Thomas Jefferson. He sought to minimize special privileges
for everyone within Anglo-Saxon society, while simultaneously promoting
free enterprise and meritocracy.
In his famous article, Left
and Right, Dr. Murray Rothbard cited the Herbert Spencer selection
above and observed:
The Old Order was, and still remains, the great
and mighty enemy of liberty; and it was particularly mighty in the
past because there was then no inevitability about its overthrow.
When we consider that basically the Old Order had existed since
the dawn of history, in all civilizations, we can appreciate even
more the glory and the magnitude of the triumph of the liberal revolution
of and around the eighteenth century.
A major problem that I have with many anarcho-libertarian
writers is that they assume the liberalism that displaced the Old
Order was purely an ideological creature. I think that this can create
confusion, because a phrase such as "old order" might also
imply folk traditions and ancient common law, such as the Anglo-Saxon
common law, that supported decentralization.
As I explain in my environmental
vs. genetic discussion
as well as in my libertarian
interpretation of American history, an urge
towards decentralization has existed among Europeans ever since prehistoric
times. This is particularly true among the Nordic and closely related
Celtic peoples. Decentralization tendencies have a strong genetic
component, shaped by tens of thousands of years of evolutionary history
under highly dispersed social conditions in frost zone environments.
The liberal revolutions of the 18th and 19th centuries were actually
cyclical, historical regressions to the mean of innate social patterns
that have repeatedly surfaced in European history for ages.
In other words, white Americans today do not need any U.S. Government
or any Zionist-dominated media or Zionist religion to tell us how
to be free. Much of our spirit of freedom is in our genes.
But I repeat myself. I have already quoted Thomas Jefferson about
the need for government that fears its own people in order to have
liberty. He essentially made the same point.
The tax-eaters vs. the tax-producers
As an important variation on the "Compulsion vs. Contract"
theme, I have also already mentioned Dr. Ralph Raico's Mises Institute lectures
on the evolution of classical liberalism, where he described how certain 17th and 18th century French libertarian
economists divided the political order into the "tax-eating"
classes and the "tax-producing" classes.
Obviously the "tax-eating" classes were the duty-based class
of compulsion versus the "tax-producing" classes who were
clearly the classes of contract.
According Dr. Ralph Raico, Karl Marx plagiarized writings of these
earlier French libertarian thinkers in many of the initial passages
of The Communist Manifesto
Marx also perverted their ideas.
The early French libertarians saw small businessmen and other entrepreneurs
as the "tax-producing" good guys, and government despots,
bureaucrats, and standing armies as the "tax-eating" bad
In contrast, Karl Marx twisted all of this around. This Jewish false
prophet saw entrepreneurs and small businessmen (the "petit bourgeois")
not as good tax-producers, but as bad guys and class enemies of "oppressed
masses." Government — in the form of Red dictators —
does not consist of bad "tax-eaters," but instead comprises
the good guys and champions of the masses.
"Down-sizing" Government Much More Critical To Society
Than "Right-Sizing" Individual Businesses
In my "Critical
Issues" section, I refer to over-sized government as "predator."
I explain that it is one of three major monsters that is wrecking
America today. It is important to review some libertarian ideas
about the inherent evils in excessive government.
These are ideas, incidentally, that were well known among Americans
back in 1776. "Liberty" back then meant "freedom
from government." The American revolution was essentially a
libertarian revolution. We should sense an Orwellian contradiction
when we hear politicians talk about the need for greater government
size and interventionism at home and abroad to promote freedom,
since they are talking about creating more forms of government to
create more freedom from government.
In his excellent book Why
Government Does Not Work, Harry Browne (1933-2006) described
how excessive government size and centralization is fundamentally
different and vastly more dangerous than similar issues involving
One critical difference between government and business is the fact
that our contact with businesses is usually always voluntary. If
we do not like a particular business' products or services, we can
usually go shop somewhere else. In contrast, it is usually a lot
harder to move to another country and change citizenship if we do
not like our government. If we decide to retain our citizenship,
we are forced to pay taxes regardless of how we feel about our government's
policies. Worse than that, if we continually refuse to maintain
our "subscription" to the Internal Revenue Service, the
government is prepared to infinitely escalate the level of force
it can use against us. After the initial polite reminder call or
letter, our continued resistance can eventually bring us not-so-polite
visits from SWAT Teams, FBI snipers, or National Guard units. In
contrast, there are no car, magazine, soap, or toothpaste manufacturers
who are prepared to blow our heads clear off if we adamantly refuse
to patronize them.
Every time people come up with noble-sounding ideas for government
legislation, they are in effect admitting that they are incapable
of getting these wonderful things accomplished by using only voluntary
means among their fellow citizens. Instead they need to back up
their wonderful ideas with the threat of state police power.
But in the final analysis, there is nothing innocent about government.
No matter whether the government decides to spend our tax money
for victims of a natural disaster, or to help tiny cute little tots
get better meals in schools, or to do obnoxious things like fund
Andres Serrano's photographic "artwork" that shows
a crucifix dipped in urine, it does all of this from "one-size-fits-all"
tax bills that are ultimately backed up by a gun put
to your head.
Not surprisingly, the incentive structures and informational feedback
systems for government officials are very different compared to
In a free market, business leaders have strong incentives to continually
devise new product ideas that give consumers more discrete purchase
choices. In a competitive free market, if they fail to produce better
choices with better quality items and at better prices, sales will
plummet and they will eventually go out of business.
In contrast, whenever government programs fail, we typically see
politicians dodge the issues, shift blame, offer excuses, institute
cosmetic changes, make false promises, or justify failure in the
name of phony patriotism. Then it is business as usual collecting
more taxes from us through our compulsory IRS "subscriptions."
After this goes on long enough, where we continue to pay taxes,
and government continues to fail to deliver, it begins to sink in
that we have effectively become vassals locked into tribute-paying
If citizens get really fed up with this "feudal democracy"
and threaten an insurrection, well, good luck achieving success.
A few hundred thousand Americans were willing to give their lives
and still failed to get the U.S. Government off their backs when
they had a third the white population on their side back in the
1860's. It is unlikely any dissident group will ever be able to
mount even that level of resistance again. The Feds and their national
media allies are just too slick. Instead, it looks like we will
just have to wait for the Federal monster to collapse in blow-out
inflation, bankruptcy, and massive corruption, much like the old
Soviet government in Russia.
Meanwhile, as Harry Browne frequently observed, government continues
to create even more dysfunctional programs as "solutions"
for pre-existing programs that have been proven failures. New programs
are usually always based upon politics, and have very little to
do with sound economic logic. Usually the people who directly benefit
from these programs have better political connections than either
you or I.
For all practical purposes, most government jobs are inherently
hierarchical, authoritarian, and bureaucratic in nature. This usually
means the top priority involves satisfying the boss who writes evaluation
reports, rather than the public. This in turn means making him look
good and aggrandizing ones own department, regardless of how it
might grow like a cancer.
Worse yet, the people who run government departments are usually
scared that if they do not spend everything that they are allotted
within a budgetary cycle, that they will get cut back the next cycle.
Therefore, there are very few if any incentives to minimize waste.
Last, but not least, in this highly structured and politicized environment,
most government employees have absolutely no business sense at all.
They are very poor at engaging in any form of competent entrepreneurial
calculation, where they successfully juggle expected market demand
against production and marketing costs and other elements of a competent
In most cases where government is capable of pursuing a "successful"
economic project, it usually involves something very crude and primitive,
like using its troops to seize territory and productive assets.
Or it will simply copy-cat business plans and procedures developed
in the private sector. Usually it needs to hire private sector consultants
to figure out how to implement these things.
All of this means that while government is very good at consuming
wealth and distorting the free enterprise economy, it is usually
incompetent when it comes to creating any real wealth. The creation
of wealth implies the ability to produce more things of higher quality
at lower cost in a way that they pay for themselves. Profitable
production increases the quantity of useful things in society. This
becomes its store of accumulated wealth.
In contrast, government by itself is rarely capable of producing
things at a cost where they pay for themselves. Therefore, left
only to itself, it will tend to run down the productive assets of
a society. This has been proven repeatedly in centrally planned,
economies where government has taken over the primary means of production
and has failed miserably at running them in an economically viable
manner, particularly when faced with dynamic free market competition.
Therefore, left only to itself, over the long run government tends
to act like an economic parasite.
Admittedly, we do need a certain minimal
amount of government. It can serve important protective functions
necessary to support successful overall social functioning. Even
anarcho-libertarians compare useful government with the way businesses
require certain minimal levels of insurance in order to survive
and be productive. We need courts...we need policemen...we need
military defense...for certain crises we may even require "energetic"
leadership...I am not arguing this point. However, the issue remains
how much "government" is just enough to aid the ability
of society to protect itself and be productive, and how much government
over this amount becomes wasteful and "parasitic."
We know that in the first half of the 19th century, Americans successfully
kept government at less than 5% of GDP. And they prospered mightily.
Today, total government in American consumes over 40% of GDP. The
long term macro-economic trends identified in my Critical
Issues discussion show that America's economy has been steadily
deteriorating. I would wager that at least three 80% of this government
percentage of GDP is "parasitic." Perhaps embedded somewhere
in the remaining 20% we can find government that is truly necessary
Near the beginning of this article I discussed the "viral persistency"
interests who have continually pushed America towards centrism
in the last century. Government evil has been promoted by self-serving
private interests who need the coercive power of the state to pursue
their anti-nationalist, blank check pro-Zionist agenda. Therefore
the problem is much more complicated than simply making the government
itself the bogeyman for all our ills. Populism vs. Plutocracy:
The Universal Struggle edited by Willis A. Carto provides
some good background on efforts by genuinely patriotic American
leaders to deal with this broader social problem.
Unfortunately this problem is escalating. We have even been put
on notice by Fed Chairman Ben "helicopter
money" Bernanke that our privately owned central bank monopoly
and its U.S. Government allies are prepared to infinitely inflate
the dollar to ruthlessly defend their interests and prolong
their existence at all costs, even if it means rendering
the dollars in our billfolds completely worthless. All this, not
to mention their open-ended "war on terror" that threatens
to continually escalate in the Middle East.
What could be a clearer statement of "The public be damned?"
Why saying "More Government is Good"
is like saying "Greed is Good"
"Government" has unfortunately become a
secular religion for most Americans. They have been deeply indoctrinated
to believe that activist government has inherent moral virtue. One
of the leading early culprits behind this trend was "King
Lincoln," who said in 1838 that the Constitution and the
laws of the United States had to become the ‘political
religion’ of the American nation. This, despite the fact
that Lincoln himself was an atheist, and promoted the financial
interests of his own political faction even if it meant risking
an unnecessary war that got over 640,000 Americans killed. (More
on this later).
One can even find this sentiment in a book such as The
Constitution of the United States by Thomas Norton,
first published in 1941, which dissects the Constitution line by
line. Norton's interpretations are framed by the assumption that
America needed more efficient central government in 1787 compared
to what it had under the Articles of Confederation. According to
Norton, the Constitution was designed with checks and balances to
prevent excessive power grabs and self-dealing as leaders go about
more efficiently guiding the country.
Implicit in Norton's discussion is an underlying belief in a need
for energetic political leaders. For all intents and purposes,
people who want more "efficient" government oversight
also want more "energetic" and "activist" oversight
This reminds me of the character played by Jimmy Stewart in Mr.
Smith Goes to Washington (1939). Most American movie
audiences tend to be very sympathetic towards Stewart's extremely
energetic, if not utterly dramatic character. While it is true that
Smith opposes a corrupt Senator who seeks to make millions in kickbacks
on a pork barrel dam project, it is also true that Smith himself
energetically pushes through a government program to create a camp
for boys in his home state. Hence, this Frank
Capra movie classic lauds energetic government involvement in
social programs so long as it does not involve kickbacks.
Thomas Jefferson voiced a totally different attitude when he said,
"In questions of power, then, let no more be heard of confidence
in man, but bind him down from mischief by the chains of the Constitution."
Furthermore, when Jefferson received correspondence about a Constitutional
Convention to be held in 1787 to create a "more energetic government,"
Jefferson responded that the last thing he wanted was a "more
energetic" Federal government.
Despite all of this, most people might think Jefferson was merely
being "cautionary." In fact, these comments were barely
the tip of a libertarian iceberg once espoused by sizeable group
called anti-Federalists. (I revisit them again later in my discussion
of libertarian racial nationalism).
Frank Capra's scripting of Mr. Smith as a folksy, populist politician
also stands in opposition to another well-established American folk
hero. In his famous "Sockdolager" speech, Davy Crockett
argued before his fellow Congressmen that there is so much money
available in the private sector for charitable purposes that the
government, with all of its fiercesome coercive powers, has no business
muscling on making charitable decisions.
Looking deeper below the water line of
the libertarian iceberg
An excellent "religious deprogrammer" to help explain
the full early American libertarian iceberg below the waterline
is Dr. Hans-Hermann Hoppe,
Professor of Economics at the University of Nevada, Las Vegas. As
mentioned earlier, he is the author of Democracy:
The God That Failed: The Economics and Politics of Monarchy,
Democracy and Natural Order.
According to Dr. Hoppe, government is inherently negative in nature.
The healthier a society becomes, the more it should make government
irrelevant. Instead of making government more energetic and efficient,
the priority should be to simply make it go away.
First, we need to look at government's real function in our society.
According to libertarians, one good working definition of government
throughout history is it consists of whoever happens to be the monopolist
on the use of force in a given territory. George Washington once
summed it up when he said, "Government is force. And force,
like fire, is a fearful servant and a terrible master."
Force, or coercion, is the negation of the voluntary relations we
seek to maximize in an ideal society. When voluntary cooperation
breaks down, and individuals and factions can no longer mediate
their differences on a private level, they typically call in the
government to use force through its courts, police, and military.
Force implies the real or threatened destruction of lives and wealth.
Hence Dr. Hoppe claims that it is more accurate to say that what
government really produces relative to the private sector are "bads"
(or negative things) rather than "goods" (or real wealth).
Dr. Hoppe raises a provocative question. Whereas we understand how
it benefits us to have the private sector compete in a free market
to produce "goods," do we really want to see the same
level competitive excellence devoted towards producing "bads?"
Do we really need to see the "best and brightest" vigorously
compete with each other in "social democracy" to sell
us more government programs, which are inevitably followed by more
taxes and more government intervention?
A look at early American history gives us an important libertarian
baseline. We need to ask how much of our government added since
then consists of a slick sales job by professional politicians and
special interests, as compared to the lessor amount of government
that we probably really need. In other words, to what extent can
we compare the taxpayer to a healthy dog, and professional politicians
and special interests to swarms of fleas?
Dr. Murray Rothbard, in his history of colonial America, described
how most farming communities in 18th century Pennsylvania had virtually
no government at all by modern standards. Part of the reason was
benign neglect. The ruling British government and its pack of attendants,
to include lawyers, professional politicians, and bureaucrats, were
across the ocean. Many of them viewed the colonials as basically
a bunch of bumpkins barely eking it out battling the wilderness.
Nothing of particular interest.
However, while "out of sight and out of mind" for nearly
a hundred years, this "bumpkinland" grew into the size
of regular European country. Meanwhile, it still had almost no government
by European standards. Nevertheless, the colonists did not seem
to be missing anything. In fact, in the absence of government, they
seemed to be quite a bit happier and more prosperous.
Then the British Government started to wake up and notice a fat
economy ready for mercantilist trade policies and tax harvesting.
The precipitating event involved the heavy expenses it incurred
fighting the French and Indian War. The Crown started wondering
why colonists should not help foot the bill.
On the other side of the Atlantic, the healthy tax dog saw the swarms
of government tax-collector fleas coming its way and resisted. That,
in a nutshell, is what started the American Revolution.
In the first decades of the new American republic, before it served
as a Darwinian petri dish for breeding its own particularly virulent
strains of homegrown political parasites (not surprisingly the the
worst types evolved from lawyers, financiers, and professional politicians),
Americans enjoyed great success in keeping government at bay. Dr.
Ralph Raico points out in his lectures on classical liberalism that
when French observer Alexis DeTocqueville visited America in the
1830's, he noted that his native France had about ten times as many
bureaucrats with nearly the same population. Similarly, when the
Russian anarchist Mikhail Bukhanin arrived in San Francisco in the1850's
after fleeing Czarist police, he commented that he had nothing to
offer Americans, because as far as he could see they were already
living in his idealized state of anarchy.
Americans communities seemed to exemplify what the nobel laureate
economist Friederich Hayek called spontaneous order. Pioneer
groups quickly organized all the social services they required on
a grass roots level without any central direction. Most Americans
belonged to numerous volunteer organizations, such as charities,
fire departments, courts, juries, sheriff's deputies, and political
affairs councils. They handled everything privately, and given their
limited resources, they were amazingly effective.
Early America also exemplified another important aspect of the spontaneous
order concept, namely that it ran itself
as a complex
system from the ground up without central planning.
Dr. Thomas DiLorenzo's book How Capitalism Saved America
describes how Americans did a much better job creating roads, railroads,
and canals with private investment than through government programs.
Most people have this notion that as economies and societies get
bigger, they require more centralized command and control. Friederich
Hayek argued that in many ways the opposite is true. He observed
that once economies achieve a certain level of complexity, they
must be run by decentralized decision
nodes, and cannot be competently run by
central planners. The information inputs and complexities are simply
too overwhelming to be handled by humans in central planning positions.
There are too many complex interactions at different levels. Furthermore
it is impossible to gather enough accurate ground-level information
in all areas to make rational decisions. Indeed, in regard to a
free market where prices automatically adjust according to supply
and demand, this also functions as a highly decentralized information
system and clearing house.
Please recollect at the beginning of this article the example provided
by William S. Lind. To be successful at maneuver warfare, even Adolf
Hitler's armies had to operate on a decentralized level. Some of
his top commanders such as as Erwin Rommel were famous for literally
living out of their squad cars where they could always remain close
to the front lines and quickly react to events as they unfolded
in real time.
An important reason why America enjoyed steady solid economic growth
throughout most of the 19th century, apart from the high genetic
quality of its underlying population and the relative absence of
Zionist parasitism, was due to the fact that America remained highly
decentralized. It did not suffer from many forms of imposed order
found in Europe, which typically did more harm than good. An area
called complexity theory that deals with
this phenomenon is also very compatible with the "Austrian"
or laissez faire schools of economics.
I would personally interject here my own interpretation that all
of this was simply a continuation of a much older story. The white
population was overwhelming Anglo-Saxon, who are a Nordic/Indo-European
people. Other whites in America during the 19th century tended to
be Celtic, who are very similar to Nordics on all levels. One sees
plenty of evidence of "spontaneous order" with these peoples
going back to ancient and even pre-historic times, whether it involves
Norsemen who settled Iceland, the Oscian and Sabine tribes from
Germany that helped found the Roman Republic, or ancient Ionians
and Dorians who swept down from northlands and settled ancient Greece.
Northern European temperamental traits, which tend to focus upon
individual initiative and creating things of real value, set the
tone for America up until the late 1800's.
We can look at parts of Norway, Scotland, Iceland, and other northern
European countries from the Middle Ages back to prehistoric times
and see how people lived in dispersed, self-sufficient communities
where the largest political organization was usually the extended
family or clan. There was no real central government by modern standards.
Every so often I come across passages that allude to republican tendencies in pre-Christian Europeans. One example is on p 70. of The End of Kings: A History of Republics and Republicans, where William Everdell writes about the pre-Christian Roman conquest of Switzerland.
The Swiss have no Caesars of their own. They were conquored once by an alien Caesar, Julius himself, in 58 B.C., and were ruled by his successors until A.D. 401. The symmetry is pleasant, for it was the defeat of the Helvetii in the Alpine passes that began Julius Caesar's military career. The career, in turn, made it possible for Caesar to destroy the Roman Republic and inaugerate a millenium of monarch to which the Swiss would eventually become the only exception. Nor did the Helvetii lose ingloriously. Like most barbarian tribes then (and the Romans themselves before Romulus) the Helvetii were strongly opposed to the permanent hereditary rule of one man; so strongly, in fact, that in the very face of Caesar's advance they deposed and executed their greatest war chief, Orgetorix, because he had tried to make himself king.
Unfortunately detailed historical records about many northern European
societies did not begin to appear until after they were Christianized.
Medieval christian leaders tended to be political centralizers and
economic monopolists, often in the name of the forceful conversion
of the heathen. Their scribes tended to interpret social phenomenon
according to their alien Jewish religious ideology.
One good example of an adverse impact was medieval France, where
Christians discouraged bathing, supported heavy-handed Kings, exerted
thought control through a confessor system, and where the Church
itself gobbled up control of much of the land. According to an article
that appeared in the American Atheist,
living standards among the common people in France dropped below
Iceland is a fascinating example of a northern European society
that remained quasi-pagan, politically independent, and largely
avoided the full brunt of Christian totalitarianism. Icelanders
functioned normally within a quasi-anarchistic republican system
for many hundreds of years without any real class structure or permanent
In many ways the settlement of early America was a "back to
the future" exercise where northern Europeans shook off the
encroachments of government and state-allied church apparatuses
that had begun in the Medieval period. Part of this revolt began
in Europe with the Protestant Reformation, which promoted church
government decentralization and individual interpretation of scripture.
In the American wilderness, their reversion towards their ancient
European indigenous type took an extra step.
There was once an age in European evolutionary history when Stone
Age white people probably wore buckskin just like the American frontiersmen
who came later. In many ways, white people were much freer and happier
back then when they functioned in smaller wilderness groups on a
racially and culturally cohesive tribal level. The works of the
late great British anthropologist Sir Arthur Keith are worth reading
to get a better sense of all of this.
Unfortunately early American pioneers were not aware of their real
anthropological roots on an intellectual level. Many of them carried
Bibles. These scriptures not only failed to educate them about authentic
Indo-European traditions of scientific thought, republican theory,
and rational ethics espoused by ancient Greeks and other whites,
but they also focused the attention of American pioneers on alien
ancient Jewish tribal traditions rather than upon their own indigenous
ancestral values. There was clearly some subtle brainwashing and
theft of heritage taking place here. Despite all this, American
pioneers in the wilderness still felt instinctively that they were
experiencing something that was very natural and wonderful to them.
As another very critical political point, these Northern European
peoples always tended to take free speech for granted since ancient
times. Free speech basically meant that people applied the same
kind of logical analysis that went into rotating crops on farmland
or building a boat to brave the North Sea into openly keeping track
of whether or not their political leaders kept their agreements
and did things that made sense.
The Roman writer Tacitus remarked that virtually all able-bodied
men in ancient Germanic (Nordic) society were armed. If you did
not carry a sword or spear, you were simply not regarded as a real
man. They were often expected to draw their weapons and duel for
honor under rules of chivalry when dishonest men tried to cheat
them. The idea of making a living by deceiving people, or by living
a double life where one continually swallows and perpetrates lies,
or by never daring to say what one really thinks while suffering
under arbitrary and devious men in power, was very alien to them.
All of this was not foreign, however, to Jewish supremacist infiltrators
who moved into America in the late 1800's to foist a central bank,
usurp national media, and more recently undermine our civil liberties
by exploiting 9-11 to promulgate war for Israel.
It bears repeating that many libertarians are quick to emphasize
that the Articles of Confederation and the subsequent United States
Constitution and Bill Rights did not give
any rights to anyone, rather they simply circumscribed the ability
of government to take away our rights. I would add to this that
these documents circumscribed the ability of government to suppress
behavioral tendencies that early Americans and their ancestors had
expressed for tens of thousands of years. The American Revolution
was fundamentally a libertarian revolution in which Americans tried
to make governmental intrusions go away so that they could get back
to their normal affairs. It was not some kind of new political rights
revelation handed down to them from the clouds.
Back to Dr. Hoppe
Let me return to Dr. Hoppe. Incidentally, I need to
point out that he is an anarcho-libertarian. Such folks tend to
refrain from racial analysis. In contrast, I am tilted towards libertarian
racial nationalism. I say this just so that you do not confuse his
views with my own.
Another key idea emphasized by Dr. Hoppe is the importance of a
sense of caretakership. When people lack a sense of long term investment
in their own society, this is the same as saying that they have
a short time preference in economics jargon. They tend to be greedier
and feel a need to plunder as much as they can as soon as they can.
"Democracy" will not necessarily save such people. In
fact, it can add fuel to the fire. Dr. Hoppe notes that with the
rise of "social democracy" throughout Europe after World
War I, politicians began to aggressively promise more social spending
and regulation in order to make a name for themselves and get elected.
Since they were only allowed to stay in office for a limited number
of terms, they knew that excessive social spending and regulation
would inevitably get passed on to someone else after they left office.
Their excesses would simply become someone else's problem.
Not surprisingly, government as a share of GDP expanded from the
5-10% of GDP range where it had remained throughout much of the
19th century to over 40%-50% of GDP by the end of the 20th century.
This was true of most governments in Europe as well as the governments
of the U.S. and Canada.
Dr. Hoppe refers to social democracy as "publicly owned government,"
and contrasts it with monarchy and oligarchy, which he calls "privately
owned government." In a privately owned government, its leaders
know that they can pass on their political estate to their heirs,
and hence tend to have a much longer time preference and sense of
Dr. Hoppe makes the really interesting point that a country with
a stable, constitutional monarchy might really be a libertarian
society in disguise. Consider if the monarch and his cabinet are
content to act within traditional bounds and never show an urge
towards tyranny. Imagine that their government is content to refrain
from increasing regulation, taxation, or spending above 5% of GDP.
Clearly, the remaining 95% of the economy is fairly free to do as
it pleases. People in the private sector may enjoy vastly greater
property rights and real political freedoms compared to people who
live in a "social democracy" that has taken over 40% of
the economy and continually burdens people with new regulations.
I am not advocating that we install a constitutional monarch here
in America. We already have our hands full dealing with a de facto
unconstitutional version named King George W. Bush. However, I believe
that Dr. Hoppe is correct about the importance of the variables
of time preference and caretakership in influencing political as
well as economic behavior.
Later on I will discuss republicanism as a defense against for tyranny,
and discuss why many libertarian
racial nationalists believe that maintaining racial homogeneity
can help preserve a sense of long term caretakership for common
genetic interests within a republican system. For the moment lets
stay with the anarcho-libertarian line of reasoning.
It Gets Even Worse with "Ponzi"
It is bad enough that government bureaucracies tend to grown on
their own like cancers. Dr. Thomas DiLorenzo, author of How
Capitalism Save America and The Real Lincoln,
describes how government can get even worse by degenerating into
a big ponzi scheme. I think that it is important to spend some time
explaining Dr. DiLorenzo's views, since we see forms of ponzi government
everywhere in America today. In addition, Dr. DiLorenzo provides
important insights regarding a critical juncture point in American
For the un-initiated, the "Ponzi scheme" comes from the
1920's racket where Charles
Ponzi solicited funds from investors, claiming he would give
them a portion of the in-excess of 400% he was supposed to make
on an international postal redemption scheme. Rather than invest
the money, he paid part of the funds to himself and sent another
part back to investors as "dividends." Since the money
was not invested in anything that achieved a real return, the ponzi
game continued as long as the scam operator could provide convincing
fake investment reports and continually find new investors to contribute
We can see how Charles Ponzi's game was unsustainable. Nothing productive
got added to the system, while he continually extracted funds for
his own use. We can also see how the spread of his unsustainable
approach throughout America's financial system could ultimately
lead to total system collapse.
According to Dr. DiLorenzo, Abraham Lincoln publicly confessed that
the central platform of his career was to promote the "Whig
program" of protective tariffs, public works, and a central
bank This was a centralizing program of special privilege initially
championed by Alexander Hamilton and later upheld by Henry Clay.
An excellent overview article is "The
Real Henry Clay: The Corrupt American Architect of Mercantilism
and Protectionism" by Ryan Setlif.
Abraham Lincoln never deviated from Clay's so-called "American
System" during his entire career. It was his central purpose.
In contrast, he waffled back and forth on the slavery issue, despite
his image today as "The Great Emancipator."
As some examples of waffling back and forth on slavery and broader
racial issues, Lincoln once voluntarily defended a Kentucky slave
owner who sought to retrieve his runaway slave who had fled to Illinois.
During the Lincoln-Douglas debates in southern Illinois, where Lincoln
played to a large population sympathetic to the South, Lincoln claimed
that Negroes were unfit to serve on juries and could never be the
full equals of whites. Shortly after he became President, Lincoln
supported the original 13th Amendment, which guaranteed slavery
in the South, provided that the South agreed to stay in the Union
and pay the new high tariffs. Lincoln also openly advocated repatriating
blacks to Africa, and defended his Emancipation Proclamation as
a ploy to appeal to anti-slavery liberals in Britain and hence help
prevent Britain from entering the war on the side of the Confederacy.
However, as Sam Dickson points out in his brilliant article "Shattering
the Icon of Abraham Lincoln," while it is true that Lincoln
spoke out of both sides of his mouth, the general trend of his career
was to the left, so we can at least credit him with consistency
as an abiding leftist on social issues.
But let us get back to the "Whig program" from which Lincoln
never wavered. The problem with this kind of program is that in
the hands of irresponsible demagogues, it can foster an unvirtuous
cycle of corruption that can ultimately destroy a limited republic.
It can send government spiraling along the path towards a spendthrift
and ultimately bankrupt Jacobin government, which describes what
we have come to at present.
As a first step of this political ponzi system, the political hack
opportunistically hunts for unethical business operators who are
happy to offer under-the-table kickbacks to the politician in return
for his ability to pass pork legislation so that the police power
of the state now supports their products against free market competition
and forces patronage at higher prices.
Getting back to my discussion about the fundamental difference between
the voluntary nature of most business transactions and the involuntary
nature of government taxation, here is a case where the proverbial
soap, automobile, and toothpaste manufacturers want to figure out
ways to get government agents to threaten to blow your head clear
off if you do not patronize their products at higher prices. Meanwhile,
the political hack gets a kickback for creating laws that compel
this patronage, while you the consumer get soaked.
Somehow I just do not think this is the kind of thing that America's
Founding Fathers had in mind.
The happy hunting grounds in Lincoln's era for finding crooked businessmen
willing to pay big kickbacks in return for state-enforced patronage
lay in three main areas:
a) industrialists who benefited from high protective
b) contractors who benefited from government-funded public works
c) bankers who benefited from central bank bailouts.
Let me interject here some qualifications based
upon my own personal views. I believe that business interests are
entitled to legitimate political representation. In addition, there
can be some strong and valid nationalist arguments for protectionist
tariffs, particularly when faced with a compelling need to create,
jump-start, or revitalize certain strategic industries.
However, anarcho-libertarians are correct that if certain protectionist
measures are left in place for too long, they tend to adversely
distort free markets, corrupt politicians, and can spoil the competitive
edge of domestic industries. Therefore genuinely patriotic nationalists
realize that protectionism is heavily "contra-indicated"
medicine that must be applied sparingly and with great wisdom and
Expressed differently, you may need to put the patient on the operating
table, but you dare not leave him unconscious with his body opened
up and on life support for too long. Protectionist measures should
be generally removed after they have done their job helping certain
industries achieve critical mass.
We should also note that a protectionist tariff is nothing more
than an excise tax on international trade. In the long run, all
taxes are bad. All taxes transfer resources from the more productive,
entrepreneurial, and decentralized private sector to the more politicized,
bureaucratic, and centralized government sector. In other words,
taxes shift economic resources to the government where they tend
to get wasted.
This is not to say that tariffs are inherently evil. Income taxes
are worse, because they involve collecting private information on
individuals. Estate taxes are worse, because they double-tax income.
Domestic excise and property taxes are worse because they tax property
ownership and internal commerce.
In contrast to all of this, tariffs may have the slightly redeeming
quality that they can force segments of American industry to make
long term reinvestments in American plant and equipment rather than
export jobs and infrastructure overseas. Admittedly, having to force
Americans to invest in fellow Americans reflects a pretty sad state
of affairs, but when we are hemorrhaging most of our industry and
skilled jobs, even medicine with bad side effects may be better
than none at all.
Most 19th century politicians viewed tariffs as a least bad form
of taxation. During this period the U.S. Governments drew most of
its income from tariffs and land sales. The government generally
refrained from levying personal and corporate income taxes in peacetime.
Therefore, a genuinely patriotic libertarian nationalist favored
tariffs only to the extent that he is very serious about eliminating
all other types of taxes.
In contrast to responsible nationalists, the political hack is out
to install protectionist measures every place he can in order to
jingle his personal cash registers. This gun for hire also likes
to leave protectionist measures in place indefinitely as permanent
cash cows for both himself and his corporate cronies. He could care
less about the long term impact on free markets, consumers, industrial
competitiveness, or anything else. He is only out for himself.
When Lincoln ran for office, he was clever enough to pose as a folksy
populist who cared about the electorate first, and not as someone
working for the kick-back. However, according to Dr. DiLorenzo,
Lincoln pulled many self-dealing pork whoppers. A major political
"fixer" in his state, he helped relocate the state capitol
at tremendous cost to Illinois taxpayers in order to benefit only
a few business supporters. He also helped locate the terminus of
the transcontinental railroad near some land that he owned. Awarded
his own private rail car by a big rail road company, Lincoln become
wealthy as a lawyer representing big railroad interests. His legal
work for common people was mere window dressing by comparison.
The tariff racket
Raising tariffs in America beyond a certain point in Lincoln's era
was especially irresponsible and dangerous given that South Carolina
made a very serious secession threat following the 1828 "Tariff
of Abominations." Despite this, Lincoln campaigned hard for
the Morrill Tariff of 1861, which initially pushed the average tariff
up to about
36.2% compared to the 18-20% rate that had been the norm in
the 1820's. Back in those days, tariffs in the 10-20% range might
be considered "normal," whereas tariffs over 40% might
be considered hostile acts. Lincoln's high stakes, pork-oriented,
political brinkmanship poker game blew up in his face and precipitated
the War Between the States that got 640,000 Americans killed.
With only a third of the U.S. population, the South paid about two
thirds of the tariffs. A huge portion of the Southern economy involved
exporting cotton directly to Europeans. The most profitable and
uncomplicated way to carry on volume trade with the Europeans was
to exchange Southern cotton for European manufactured goods, and
then back haul these goods to America. The increased tariff rate
to 36.2% significantly reduced what Southerners could net out for
their cotton sales both at home or abroad.
In contrast, many Northern industrialists could not compete very
well against English manufacturing. They benefited by keeping European
manufacturers out of the U.S. market by forcing consumers to pay
higher prices for their tariff-protected goods. These industrialists
were Lincoln's primary political constituents.
Many intelligent observers understood all this at the time. In fact,
even Karl Marx, who admired Abraham Lincoln's leftist tendencies,
observed that the War Between the States was first and foremost
a war fought over the tariff issue and not slavery.
The public works racket
Many 19th century American leaders viewed public works projects
as a scam because the private sector generally built roads, canals,
and railroads much more efficiently than government-sponsored programs.
In fact, according to Dr. DiLorenzo in How Capitalism
Saved America, public road-building programs got such
a bad reputation for their corruption and inefficiency across America
that by 1860 most state legislatures outlawed them.
No doubt this comes as a shock to most contemporary Americans, who
are conditioned to associate ordinary road and Interstate highway
construction with government grants. Maybe this really shows how
much we have been conditioned to tolerate corruption and inefficiency
without knowing it.
The central bank racket
Thomas Jefferson, Andrew Jackson, and many other early
American leaders vehemently opposed the creation of a central bank,
and this was not because they were ignorant, archaic, or smoking
dope. I have already discussed how the ability of central banks
to issue fiat money can be very dangerous. As Voltaire once remarked,
fiat money always returns to the intrinsic value of paper, which
is zero. Putting fiat money in the hands of politicians and private
bankers is like locking alcoholics in a liquor store.
The same is true, incidentally, of a fractional reserve banking
system that goes hand in hand with central banking. This allows
banks to loan out money they create out of thin air based upon a
certain percentage of funds held as deposits. Expanding fractional
reserve ratios can create all kinds of opportunities for self-dealing
and aggressive lending. It also contributes to more extreme economic
cycles as banks go through aggressive credit expansion and contraction
cycles. Later I explain how the fractional reserve excesses heated
up in 1913 once America got its permanent central bank.
Another major negative behind the existence of a central bank is
the way it serves as a lender of last resort. While it may sound
barbaric in the short run, in the long run it is much simpler and
more honest to allow local banks to fail. This approach is much
more likely to punish bank officers who screw up, and simultaneously
quarantine bank problems on a local level. During most of the 1800's,
when America had no central bank, the failure rate averaged no greater
than 1-2% a year. Most Americans found this manageable by diversifying
where they held their deposits. Also, they did not suffer when they
buried their gold-backed money in their back yards or stuffed it
in mattresses. The dollar was worth 50% more in 1912 than it had
been a hundred years earlier.
In contrast, central bank bail-out of crony banks means that reckless
and incompetent banks survive and prosper, while overall system
risk continues to accumulate at the central bank level. Ultimately
the entire economy may become vulnerable to a blow-out. As one example
we face today, rather than reform the financial system after the
Long Term Capital Management melt-down of 1998, the Fed has continued
to bail out banks which have now accumulated derivatives amounting
to something over twenty times the size of the U.S. economy. Fed
Chairman Ben Bernanke has also declared publicly that he is prepared
to inflate the dollar without limit, and as of March 2006 discontinued
reporting M3. All of this is very scary. More on all this later
when I discuss Vincent LoCascio's excellent book Special
What-me-worry so long as I can deal,
We need to get a sense about how the political hack helps to spread
corruption. Once the public gets conditioned to accept more government
interventionism, it becomes a smaller step towards social democracy
where the public corrupts itself by accepting ever more social welfare
programs. Now instead of working to get kickbacks from narrow business
interests, the demagogue works to get kickbacks from the under classes
who he buys off by spreading pork to them. In reality, the demagogue
is stirring up forms of financial civil war and class warfare.
Once one uses the coercive power of government to redistribute wealth,
in essence one group of citizens is using government to raid the
pocket books of other groups of citizens. Whether it is done discretely
behind the scenes with IRS forms, or done in a crude manner by government
troops with fixed bayonets (or French Revolutionary pitch forks
and pikes) — in the final analysis it is all pretty much the
James Madison once wrote that there has never been a democracy that
did not murder itself. Once government becomes Santa Claus to both
special business interests and the general public, it becomes hard
to take back the pork. If anything, pressure continually builds
in the opposite direction to provide ever more pork and ever more
special privileges. Major portions of the public lose their self-sufficiency
and become emotionally and financially dependent on Big Brother
government. They become ever more willing to vote for more government
to try to solve the problems created by government in the first
place. The nonproductive and dependent sector of the economy steadily
grows. Meanwhile, growth in government squeezes out increasing portions
of genuinely competitive, private entrepreneurial infrastructure.
It is the competitive private sector that can survive and thrive
without special privilege that creates most of the real jobs and
wealth. As the productive sector steadily shrinks, and the nonproductive
sector steadily grows, we can now clearly discern a full blown and
ultimately self-destructive parasitic ponzi system.
From Ponzi Government to Evil Government
Ponzi government, as bad as it is, tends to be relatively
passive. It thrives in the gray zones where people either do not
know or do not care about long term vs. short term tradeoffs in
public policy issues. While it is indulgent and morally permissive,
it is usually not violent and bloody.
Unfortunately, if not arrested in time ponzi government can turn
into evil government. For people who study the true history of America,
we have already had a fair taste of this since the Abraham Lincoln
dictatorship. This is a situation where the government goes out
of its way to artificially manufacture violent crises and kill people
to simultaneously justify its existence as a protector and deflect
blame from its own failings
In extreme cases, such as in the French Revolutionary Reign of Terror,
the Bolshevik Revolution, or the Cambodian killing fields, government
engages in mass butchery. However, most evil governments try not
to go quite this far since it can undermine their tax base and seriously
erode their public image. It is more typical for evil governments
to try to hide their fingerprints by engaging in such games as "protection
racket," "agent provocateur," "blame shifting,"
and "wag the dog" operations.
Games that Evil Governments
The protection racket
A classic example of a "protection racket" involves a gangster
who hires a hood to vandalize a store. Then the gangster approaches
the store manager to sell him his protection services from hoods in
return for a cut of his business. This is true parasitism at play.
Nothing of economic value has been created, and in fact the negative
"make work" activities degrade real economic progress.
We may be experiencing an example on a major national political level
in America today. Many American libertarians, such as Dr. Paul Craig
Roberts, claim that America had no legitimate reason to invade Iraq.
Sadam Hussein had no ties to Al Qaida and he had destroyed all his
weapons of mass destruction. In addition, there were too many unanswered
questions about 9-11, which I link to in my "Critical Issues"
section. Therefore, the overblown threat presented to Americans to
justify increased aid to Israel and increased expenditures for the
military-industrial complex and a newly created Department of Homeland
Security constitute a large-scale protection racket.
A more complex variation on the political protection racket can be
played with the old political game of "divide and conquer."
Here is how it works: Find two factions that have money and simmering
hostility. Use agents provocateurs to stir up trouble between them
into open warfare. Then sell armaments and defense consulting advice
to both sides. Make good money as you watch people destroy each other.
A good example is provided in By Way of Deception
by former Mossad Agent Victor Ostrowsky, where the Mossad provided
training to both government forces and Tamil rebels in Sri Lanka.
He tells the story where troops from both sides happened to be undergoing
training in Israel, and someone goofed in the scheduling and had them
on the same military base at the same time. Ostrowsky said that the
Israeli instructors had some tense moments when both groups were engaged
in physical training one day on the same athletic field, and were
running towards each other with a fence between them. Fortunately
they did not recognize each other as they passed by.
Sometimes this game can be combined with another game called "reductionism."
Here is how it works. First, find one side with money, and another
side that is a potential threat. Use agents provocateurs to stir up
open warfare. Work with both sides. The fact that you are not making
money from either one or both sides is counterbalanced by the fact
that you like seeing each side destroy each other. Ostrowsky talks
about how the Mossad played this game between Christians and Muslims
in Lebanon. As another example, in French history Cardinal
de Richelieu of Three Musketeers fame
was famous for the way he ruthlessly played his real or perceived
enemies off against each other, often providing covert aid to each
side. He kept hostilities simmering behind the Thirty Years War, which
completely ruined his perceived rival Germany.
A slick version of the agents provocateurs game is to attack yourself.
Since ordinary honest people find it difficult to fathom government
leaders who can sink so low that they are willing to kill their own
people and destroy their own buildings, crooked leaders can blame
the attacks on their enemies and frequently get away with it. This
blame game gives them a justification to go into a warlike mode, which
in turn can give them further justification to suppress civil liberties,
stifle dissent, and aggrandize their power base.
In my Critical
Issues section I discuss the strange anomalies behind the Oklahoma
City bombing and the likely controlled demolition World Trade Center
Many thinking Americans believe that the Oklahoma City bombing was
not only intended to falsely discredit the militia movement in America,
but also act as a dress rehearsal for 9-11. They also believe that
9-11 was fabricated to falsely blame Arab militants and create a pretext
for America's invasions of Afghanistan and Iraq.
Wag the dog
In the "Wag the Dog" game, government starts hyping perceived
threats to a crisis level in order to deflect attention from problems
on the home front. . This phrase comes from a fictional movie based
on a widely held public opinion that President Clinton ordered some
cruise missile strikes against alleged Al Qaeda sites in Afghanistan
and increased air attacks on Iraq in an effort to deflect attention
on the home front. He faced impeachment over what he got caught doing
on the carpet of the oval office with his Jewish intern Monica Lewinsky.
When "Wag the Dog" involves creating a war somewhere, it
often gives political leaders an excuse to clamp down on dissent at
home. Both the U.S. and Israel have basket case economies, and their
leaders may require "wag the dog" to not only to deflect
attention, but also to try to save face if either or both economies
go into hyperinflationary meltdown.
Decentralization as a remedy
Libertarians are quick to point out that unscrupulous
gamesmanship seems to correlate with increasing size, power, centralization,
compartmentalization, and levels of management in government. Few
Americans grasp that the same problems and solutions that apply to
excessive business centralization can also apply to government.
The vast majority of universities teach macroeconomic theory that
justifies a busybody central bank, big government intervention, and
corporate central planning. This theory is disconnected from microeconomic
theory and business realities. In fact, in his lectures, the late
Austrian economist Dr. Murray Rothbard commented that while "microeconomic
theory is in good shape," in contrast, "macro economic theory
is screwed up."
We can find numerous historical examples where political secession
has been handled in a calm, peaceful, and mutually successful way.
Earlier I mentioned how America's mother country, Britain, decided
to handle her other "children" after the American Revolution.
By granting Canada, New Zealand, and Australia complete autonomy,
these countries have reduced layers of government and have become
more responsive to their own internal needs. At the same time, they
have enjoyed favored trade relations with the mother country and have
rallied to her defense in time of crisis.
Sometimes after growing up, leaving home, and becoming self-sufficient,
the children can help the parents in return.
Another good example involves the Scandinavian countries. Dr. Lothrop
Stoddard, in his classic work Racial Realities in Europe,
talks about how Norway demanded independence from Sweden in 1905.
At first the Swedish leaders considered armed invasion, since Norway
had only half Sweden's population. Contrary to some popular stereotypes
about Nordic berserker rage, Stoddard points out that these Nordic
leaders in actuality showed tremendous level-headedness and sensibility.
They decided to let Norway go peacefully. Stoddard observed that this
level-headedness and chivalry is all too often absent in other places
in Europe, particularly the Balkans.
Today Norway and Sweden are the best of friends on many levels, proving
that political secession can be reversed over time and replaced with
warm friendship on many different levels of sovereignty. On many economic
levels, Norway and Sweden act as if they are still the same country.
A Norwegian citizen can cross over into Sweden and work in any job,
and vice versa. Both countries also cooperate on a national strategic
level. As one example, I am aware that both Norway and Sweden shared
the cost of hollowing out the interior of a mountain to store strategic
I personally think that the policy of peaceful secession rather than
forcing unity at all costs was good for both countries. For starters,
they are both relatively small countries, and could hardly have afforded
a war that might have turned into a very costly fratricidal conflict.
Secondly, the secession helped bolster the distinctive Nordic national
identity and pride of each country.
Prior to the demand for independence, Norwegian nationalism got a
shot in the arm from the unearthing of Viking ships in burial mounds.
Norwegian nationalism and consciousness of an ancient shared heritage
has helped to provide a check against excessive Swedish cosmopolitanism
which in turn has helped to preserve the Swedish national identity.
For all the problems that Norway and Sweden are suffering today from
Third World immigration, to include the complete takeover of certain
Scandinavian towns by dark aliens, the swamping of the welfare system
by swarthy hordes, and the ten to one hundred fold increase in rapes
of Nordic women in various multiracial areas, I believe that the problems
would be only that much worse today if Sweden had kept Norway united
through military conquest and then saturated the Norwegians with anti-national,
integration propaganda. The anti-nationalistic poison that the Swedes
might have dumped on Norwegians to forcefully integrate them into
their society would have ultimately blown back on themselves.
There are other examples of peaceful secession between Nordic countries
worth mentioning. In 1945 Iceland asked Denmark for independence.
Denmark responded by basically saying in effect "God bless you
and good luck," and even sent a naval destroyer to return to
Iceland from its national archives original manuscripts of medieval
Icelandic sagas. Similarly, Sweden has historically been respectful
of Finnish requests for more autonomy.
One might argue that secessionism has actually been fairly normal
and even desirable in the history of Nordic and closely related Celtic
peoples, to include Dutch secession from the Spanish Empire, and periodic
bouts of Scottish and Irish secession from the British. One might
argue that the way the South was handled just before, during, and
after the War Between the States was tragic, vicious, and abnormal
by many historical standards, and has provided a basis for many of
the major problems we face today.
The U.S. Government has granted independence to the Philippines, but
in the current political environment it is hardly likely it will consider
granting peaceful secession
to Idaho, Montana, New Hampshire, the South, or any other state or
Although the War Between the States originally started over very legitimate
Southern grievances regarding tariffs and state's rights, Lincoln
deliberately entangled these issues with the slavery and white vs.
black racial relations issue to create a horrible neo-Jacobin ideological
mess. The United States became the only major "civilized"
country in the 19th century that was incapable of resolving its slavery
problem in a peaceful manner. France, England, Brazil, and others
did it peacefully, but America had to destroy half the wealth of the
South and kill 640,000 of its finest. I would invite the reader to
visit the King Lincoln archives at www.mises.org as well as more of
my own commentary related to this topic in my History Reinterpreted
Decentralization regarding the financial system
It is very important for Americans to understand the difference between "natural" (or "free market" or "libertarian") forms of money and credit, and "dictated" (or "fiat" or "centralized") forms of these same things. This is very important both in order to understand American history as well as to grasp the underlying nature of America's current financial crisis.
Unfortunately in America today, its controlled media tends to frame all economic debate within a relatively small conceptual area by historical standards. We typically hear about such "modern" schools of economic thought as monetarism, Keynesianism, and supply side economics. What all these schools have in common is a fervent belief that it is highly desirable for Big Government and a big central bank to actively manipulate a "dictated" (or "fiat") money system. People who dare to suggest a natural money alternative, completely divorced from government and central bank coercion and manipulation, are often treated in a very condescending and disrespectful manner by the controlled media.
Interestingly enough, America's economy successfully ran on a natural money system during major periods of its history. "Natural money" simply means the medium of exchange that evolves naturally in a free enterprise system when private citizens are free to chose whatever they want to use as money without any outside coercion, restriction, or manipulation by a government or a central bank.
Historically, gold and silver have generally tended to emerge in various societies around the world as the "natural money" of choice. This is because gold and silver have always exemplified all the best characteristics people have desired in a medium of exchange. These precious metals are always very limited in supply (mines can never add more than 5% a year to global supply). They also have practical use for jewelry or as industrial commodities, are infinitely divisible, are always uniform in quality, are highly transportable, and are virtually indestructible.
Natural money systems not only involve the use of items that have intrinsic value such as gold and silver as a medium of exchange, but also for the sake of convenience, the use of warehouse receipts for any other items that also have intrinsic value. As an example, colonial Virginia used warehouse receipts for a pound-of-tobacco as money. In the coinage act of 1792, the U.S. dollar was specifically defined as 371-/4 grains (troy) of fine silver. The exchange rate of gold and silver was fixed.
Banks in early America essentially served as warehouses that held gold and silver. Dollar bills were essentially warehouse receipts for these holdings. Actually it was not quite this simple, since banks tended to keep only about 40% of their deposits in gold reserves or their silver equivalents rather than maintain a 100% coverage ratio. However, in the 19th century one could still walk into just about any bank and exchange his dollar bills into gold and silver coins at will.
Today, no one can walk into any bank and swap Federal Reserve Notes (what we call "dollars" today) for gold and silver coins. In fact, it is illegal to use gold and silver coins to buy common goods in retail stores. If you need to exchange gold and silver coins into cash, you must first visit a coin dealer.
The Federal Reserve Notes (FRN) you are required by law to use as legal tender are not backed up by anything except the police power of the state that forces you to use it. This is why it is called a "fiat" currency. ("Fiat" means "dictated"). It is also backed up by a broader intangible, namely public "confidence" that our politicians and central bankers are not going to completely debauch the value of the fiat money system any time soon.
In contrast to our "modern" system, Americans in the 18th and 19th centuries not only routinely transacted with gold and silver coins, but also frequently used foreign coins such as Spanish silver dollars, Brazilian coins, and French silver crowns and livres. According to one source, 80% of specie circulating in America in 1800 consisted of foreign coins. (p. 67, Rothbard, History of Money and Banking in the U.S.). In fact, Americans were often jealous of their free market money. For example, when Abraham Lincoln tried to get Californians to accept his "greenback" paper dollars in lieu of their gold and silver coins to help finance his war against Southern Independence, the Golden State folks basically told him to bug off. However, they did not go so far as to secede.
Since the creation of America's privately owned banking cartel called the Federal Reserve in 1913, America has gone over completely to a "fiat" or "dictated" financial system. In 1933, the U.S. Government even went so far as to confiscate privately owned gold, although thanks to some strenuous grass roots activist efforts it restored the right to own gold in 1975. In addition, bank gold reserves today are often lower than 1%. Banks are free to create loans out of thin air based on a fractional reserve system in which they often require less than 10% deposits to back them up. Most of these deposits consist of fiat money rather than gold and silver. Hence, we face a situation today consisting of mainly fiat money deposits backing up other fiat money deposits. America is essentially floating on a giant, rapidly expanding sea of paper secured by nothing except "confidence" and police power.
As an aside, I need to alert the reader that while what I have said is true in terms of broad generalities, there are certain historical exceptions and nuances that I have left out to try to keep things simple for introductory purposes. For example, in an effort to handle the tremendous financial burdens of the American Revolution, War of 1812, and War of Southern Independence, the U.S. Government saddled itself with various paper money regimes and de facto central banking schemes. However, by 20th century standards, these things were relatively temporary. Eventually things reverted back to hard money systems. Also, the banking system in America was not always totally "hard." Not surprisingly, many "wild cat" banks in the "Wild West" frontier resorted to wild and wooly banking practices. Nevertheless, by 20th century standards, American banking generally remained relatively "hard," privatized, and decentralized.
I think a good way to understand the differences between these two very approaches to money and credit is to examine them on an ethical level and also in terms of the short term vs. long term tradeoffs of decentralized vs. centralized systems.
Before we delve deeply into the monetary issue, we must first examine ones fundamental attitude towards government. As I explain in my mutualism vs. parasitism section, republican government evolved as a remedy against tyranny,. This means creating a political system designed to resist rule by cruel, arbitrary, capricious, incompetent, irrational, or insane decrees by a very limited number of specially privileged individuals.
Republican government implies decentralization of political power out of the hands of one person or a small clique. It also implies checks and balances. It also implies adherence to consistent standards, and open disclosure and open discussion of policy issues.
Therefore, if your government is going to inflate the currency, this can have some very nasty implications regarding basic republican principles. Inflation is an indirect form of taxation. It destroys the purchasing power of the common citizen just as much as if he had been taxed. Therefore, if you believe in taxation only with representation, and if you believe strongly that all important policy issues must be subjected to open public debate, then you must believe that every decision to inflate the currency must be thoroughly scrutinized by the citizenry and their elected officials and must be subjected to a full legislative process before ever being implemented.
This is exactly what we do not have in America today. In fact, in March 2006 the Federal Reserve Chairman, Ben Bernanke, told Congress that the Fed no longer feels that it needs to report the growth in M3 monetary aggregates created by the Fed itself.
When Congressman Ron Paul dared to ask why the Fed would dare to do this, he was arrogantly told that it was simply to expensive for the Fed to bother to keep track of its own policies. What is really pathetic today is that Congressman Ron Paul is one of the very few Congressman with the economic literacy and loyalty to the Constitution to even dare to ask this question.
The Fed is currently inflating the currency at over 10% a year. In fact, it has been doing this every year more or less since 1995. This means that Americans are effectively taxed over 10% a year (in addition to their other taxes) not because of any legitimate republican legislative process, but because of the way some very small clique of central bankers operating behind closed doors might decide to help out their political buddies or because how of they might they feel after an all-night party when they pop some aspirin and shift their rear ends in their chairs a certain way.
At the opposite extreme to all this is a gold and silver backed hard money system of the 19th century. During much of this period, money was kept out of the hands of central bankers and the government.
Since gold mining companies can rarely add more than 5% a year to the total world gold supply, under a hard money system there is almost never a danger of serious inflation that can tax people without representation or rob them of the value of their savings. In fact, under the gold standard, the dollar could buy 50% more in 1913 than it could a hundred years earlier (despite a bad bout of inflation of Lincoln greenbacks during the War of Southern Independence). The British pound, which had not experienced such wartime distortions, could buy 100% more for the average British citizen at the end of the same 100 year period.
The French philosopher Voltaire once commented that paper money always returns to its intrinsic value, which is zero. Throughout history, the general pattern has been that central bankers and politicians have always abused their fiat money privileges and completely debauched their own currencies.
In regard to the ethical issue behind all of this, the ability of central bankers and politicians to cheat the public is so great under any fiat money system that in his book The Gold Wars, former Rothschild banker Ferdinand Lips commented that when most European nations went off the gold standard at the beginning of World War One, one prominent banker commented that this signified "The end of honor."
In the final analysis, in economics there are no free lunches. Someone always pays a price for the consequences of economic policies both in the short run and the long run.
In a hard money system, no one even attempts to give out any free lunches. But then again, this reluctance to cut corners is simply an honest statement of economic reality. In contrast, in a fiat money system, certain insiders use their inflationary power to slip "free lunches" to their political buddies. At the same time, they pretend on the surface that the system is honest in order to maintain public confidence. But in reality, we see that this system is really very crooked.
An inflationary fiat system resembles a ponzi game, where the first people to spend the inflated dollars get the full benefit of their purchasing power. However, as these added dollars slosh around the economic system and inevitably drive up prices, the people left holding the bag are common citizens who must now pay higher prices for goods without any increases in their paychecks.
This brings us to the issue of short term vs. the long term trade offs. In the short run, a fiat money system can initially make life easier for many people in society, because the circulation of extra notes can help stimulate additional demand for goods. However, we need to bear in mind that this additional spending usually comes from government bureaucracies or the additional credit created under a fractional reserve system by bankers. Government bureaucrats and reckless bank loan officers handling hot money are typically the least competent people to be making wise investment decisions. Typically the most competent people in an economy to make investment decisions are entrepreneurs, small businessmen, and industrialists in the heartland. These people include scientists, engineers, and inventors who create the steady flow of innovation that is absolutely vital to sustain the automation revolution and continually drive down prices with more advanced manufacturing methods and improved devices. Therefore, we can already see how a fiat money system starts to shift economic decision-making power out of the hands of successful entrepreneurs and other savvy businessmen and inventors in the heartland and towards relatively arrogant, selfish, and stupid bureaucrats and bankers based in places like Washington D.C. and New York City.
Typically the stimulus created by the bureaucrats and aggressive bank loan officers does more to distort the economy than provide a basis of solid, sustainable growth. Over the long run, this artificial stimulus created by inflating the money supply or increasing credit under fractional reserve lending system becomes comparable to a person who relies on junk food to satisfy hunger or a drug addict who needs his usual dose to avoid withdrawal symptoms. Furthermore, easy money systems tend to encourage easy values, where people take hot money and put it into highly speculative enterprises designed to produce quick gain from changes in market psychology that are completly delinked from underlying economic fundamentals.
With a hard money system, things are admittedly a little bit tighter in the short run, but in the long run it is infinitely more honest, stable and healthy. A hard money system places the full burden on making prudent business and other investment decisions on the local entrepreneur, industrialist, and other businessmen. If they screw up, they pay the price, even if it happens to be a hard price.
Hard money systems tend to encourage hard values focused on savings, thrift, and prudent foresight. They tend to be focused on building real businesses that provide real products that provide real services.
I personally believe that in the long run, a hard money system is the only system that is fully compatible with republican principles. Republicanism essentially means decentralizing all the hard issues of carrying on the affairs of state on to the shoulders of common citizens. If people on a grass roots level have adequate character, intellect, and education, then decentralization is vastly better way to go compared to consolidating all power into the hands of a very few.
Similarly, since natural or "free market" money systems imply decentralized economic power, why would someone who favors decentralized political power not also favor the same thing on an economic level?
Decentralization regarding central banks
and military alliances
Before leaving the centralization vs. decentralization debate, we
need to spend more time talking about central banking. This is critical, because centralized banking has provided
the financial rocket fuel necessary to greatly accelerate political
and economic centralization — and corruption — everywhere else in America. It is also critical because the system
now threatens to create a hyperinflationary economic meltdown in America
that will impact everyone.
First, we need to really question the entire underlying philosophical basis
for the Federal Reserve Banking System which currently threatens to
totally debauch our currency. We also need to understand the role
that it plays in ponzi politics and in exacerbating rather than reducing
Secondly, after dealing with the central bankers,
we need to deal with some military-industrial complex sacred cows
in the "system risk" topic area as well.
Let me go back through an overview of central banking. Please pardon me when I repeat some points made earlier in this article.
Back in the early 1800's American currency was usually tied to gold and
silver. Approximately 40% of bank reserves had to be secured by
precious metals. It was common to pass gold and silver coins back
and forth through a bank teller window. People believed correctly
that when money is delinked from a hard asset and placed in the
hands of politicians and central bankers, that they tend to abuse
their "license to print money" and ultimately drive the
value of paper money to the ground. We are back to the famous saying
by Voltaire that fiat money tends to always return to its intrinsic
zero — since
putting fiat money in the hands of politicians and central bankers
is like handing the keys to a liquor cabinet to a gang of alcoholics.
Therefore, it was wrong to have a central bank except for use as
a wartime emergency. People preferred a highly decentralized system,
where local banks were allowed to fail rather than getting bailed
out by the government or a central bank.
According to Dr. Murray Rothbard, the bank failure rate in the 19th
century averaged only about 1-2% a year at most. People usually
managed around bank failures by keeping their money deposited in
multiple banks. Also, since their gold and silver-linked money tended
to steadily appreciate over time, it was a lot easier to store it
in places outside of banks, to include the insides of mattresses
and chests buried in the back yard.
Another important point about these supposedly archaic, bad old
days of "tight money" that tied dollar bills to such "barbaric
relics" as gold and silver is that America experienced real
economic growth rates of around 4-5% a year during times of peace.
This was well beyond the average growth rates experienced during
the more "enlightened" fiat-money era of easy monetary
and credit expansion in the 20th century.
A third point is that the banking industry used to be much more
honest and understandable for people. The underlying reality used
to be that when one gave his money to a banker to get interest income,
he took the banker in as a business partner. In return for storing
his funds and finding a qualified borrower, the banker shared the
interest income with the depositor, net of the banker's expenses
and default losses. Since banks typically have most of their funds
loaned out, bankers typically have to finesse paying out cash to
people who make withdrawals. Normally depositors knew this and had
no incentive to destabilize their own hometown bank with a bank
run unless they had solid grounds to believe something was really
wrong. Conversely the banker had every incentive to earn a public
reputation for rectitude to forestall such a run.
The position of a head banker is one of the most sensitive in society.
A crooked banker can create loans out of thin air based on reserves
he does not have, and then use his ill-gotten wealth to buy off
politicians and police. This is the easiest and most lucrative form
of theft on the planet. Meanwhile, other bankers are always struggling
to maintain public confidence to prevent a run on their own banks.
On the one hand they do not want to unnecessarily alarm the public,
but on the other hand it is an extremely dangerous sign of moral
decadence when the business leaders in a society allow aliens and
crooks to gain a beachhead inside their banking system.
Perhaps one of the greatest breaches of national security among
Western nations in history took place during the Napoleonic wars.
This took place when the Rothschilds and other extremely wealthy Jewish families were able to stage a silent coup de etat using their sinister advantages. They held in-bred mafia-like tribal loyalties, a tremendous capacity for covert
intelligence operations, and close ties with smugglers and
other organized crime elements. Using these dark powers, they were able to make very daring financial manipulations
of gold reserves and falsified credit. These Jewish families had already gained important access to various ruling aristocracies in Europe, and now under the cover of war time "necessity" they were able to pull off collosal banking swindels. A particularly famous
example involved smuggling gold across France to pay off British
soldiers who were fighting Napoleon in Spain.
During the 19th century they got away with their incredibly nervy
crooked manipulations. They parlayed massive funds created out of
thin air through bank confidence games into real holdings in companies.
They also used their riches to buy political influence and social
position. John Reeves described in The Rothschilds:
the Financial Rulers of Nations how they embedded
themselves inside central banks of many nations of Europe and became
more powerful than many European monarchies.
This provided a base to expand international financial manipulation
and political thuggery to new levels, such as genociding innocent
women and children, saddling America with its privately owned
Federal Reserve Banking System in 1913, and funding
most of the Bolshevik
Revolution. The big money center bankers in the 20th century
became particularly ingenious at taking their risks and pawning
them off on the government and ultimately the taxpayer. They have
also become also very ingenious about creating false public impressions
and confidence that hide underlying economic realities. Last, but
not least, they certainly have not lost their chutzpah, whether
it has involved saddling
Russia with kleptocrats, assassinating President John F. Kennedy
(cf. Final Judgment), "pulling"
9-11 controlled demolitions,
or high jacking American policy to fight wars in the Middle East
(cf. High Priests of War).
Creating real wealth as opposed to scamming it from
the financial system
For the moment, let us review the basics regarding how real
wealth is created in society.
The most critical factor in solid economic growth is competent entrepreneurial
calculation. This means competently developing, evaluating, and
executing business plans that focus on the creation of real products
and services. This in turn means delivering a "value proposition,"
in which businesses learn how to profitably deliver products that
provide a superior ratio or quality to cost to consumers. The entrepreneur
takes the risk that in the process of executing his business plan,
market demand for his products will be adequate to profitably cover
his costs of operation.
It is very helpful to have a stable currency to aid the process
of entrepreneurial calculation. This helps the entrepreneur be more
accurate in forecasting revenues and costs looking into the future.
It is also helpful for the free market to determine interest rates,
because this gives the entrepreneur more accurate information about
the time value of money and real rates of inflation.
Real wealth creation also means having a large community of people
who can support each other in principled free enterprise competition
that should ultimately create wealth for everyone. Business competition
should be tough enough to reward excellence and promote meritocracy,
but chivalrous enough so that businessmen are allowed to specialize
and prosper at what they do best in an ecology of business relations
that ultimately create more wealth for everyone.
Lastly, real wealth creation requires the honest informational feedback
system of a free market. I mentioned earlier how central planners
are incapable of operating complex systems. All of this in turn
implies that the private sector must retain overwhelming control
of the economy and national wealth.
In contrast to this focus on specific products, specific business
relationships, and maintaining free and honest markets, central
bankers use an macro-economic shot gun approach where they manipulate
interest rates and the money supply. They end up distorting all
of the basic elements of real wealth creation. Rather than allow
the free market to set interest rates, they distort free market
feedback signals by arbitrarily raising and lowering interest rates.
They undermine currency stability by steadily inflating the money
supply, and they undermine credit system stability by expanding
and contracting credit under a fractional reserve system. The Mises
Institute offers an excellent video that explains all these things
in greater detail titled "Money,
Banking, and the Federal Reserve."
I have already explained why government officials are incapable
of creating real wealth, and how excessive government growth and
intervention tends to act as an economic parasite over the long
run. It is no different in regard to the individuals who run a central
Despite all of this, both the influence of America's government
and central bank have increased mightily for over nine decades.
It really makes one wonder about the character of the people in
charge of these entities. After the reader performs his own in-depth
research, he might conclude as I have that the word "criminal"
is hardly too strong. One might even begin to conclude that America
has been led by very selfish, unprincipled people behind the scenes
with alien interests who have been out to ruthlessly exploit the
The sad history of America's current
Following the creation of the Federal Reserve Banking
System in 1913, two very critical things started to happen.
First, banks started dropping their required reserves. Throughout
much of the 19th century, banks backed up about 40% of their deposits
with gold. Now gold reserves were being dropped towards the single
digit level. In fact, within a few decades gold was completely replaced
at most banks with Federal Reserve paper.
Second, banks started to become very aggressive under a new fractional
reserve system. This meant that they started lending out many multiples
of whatever deposits they had on hand. This in turn meant that they
could collect interest on loans that they created out of thin air
which were in excess of deposits. This also meant an aggressive
expansion of the money supply during the First World War and Roaring
Aggressive money expansion typically fuels speculative investment,
which in turn tends to fuel overly leveraged investments, mal-investment
and economic distortion. At some point the need to write off mal-investment
coincides with a recessionary credit contraction.
As a defense against a sharp recession, the Fed was supposed to
step in and bail out problem banks as a "lender of last resort."
This was one of the features of the Federal Reserve Banking System
that Paul Warburg and his allies sold to Congress in 1913. In actuality,
the Fed was highly selective about who it helped during the ensuing
credit implosion. According to Vince LoCascio in Special
Privilege (p. 95):
The first opportunity the Fed had to be a lender
of last resort occurred during the 1920s. In 1920, there were 23,000
banks in America. In 1929, there were only 18,000. In the interim
5,700 banks failed and less than 1,000 new ones were formed. In
other words, about one out of every four banks failed during the
20s — the
first full decade after we instituted the lender of last resort!
During the 50 years of the reputedly ineffective National Banking
System, only in 1893, a panic year, did more than 300 banks fail
in a single year. From 1921 through 1929, during supposedly good
times, an average of over 600 banks per year failed. Even in the
best of those years (1922) 367 banks failed. From 1930-33, over
9,100 more banks failed, producing a 50% reduction in the number
of banks in a four-year period. As lender of last resort, the Fed
was an even more miserable failure than as a source of monetary
Instead of saving America from sharp business
cycles, bank centralization instead set up America for the nastiest
depression in its history by first fueling excess monetary and credit
growth in the prior two decades. This preparatory bout of massive
inflation was part of a broader, more complex international story
in which the U.S. Federal Reserve sought to accommodate the needs
of the Rothschild-controlled Bank of England, which sought to restore
the old global strength of the British Pound relative to the dollar
in the aftermath of Britain's ruinous World War One inflation. This
was certainly not part of any kind of "America First" policy.
Rather than stabilize the currency, as was promised when the Fed was
created in 1913, the Fed has instead eroded over 97% of the value
of the dollar since inception.
The centralization of credit has created all the same problems I have
described with other centralization ploys. First, it has reduced accountability
and decoupled performance from returns. In the 1800's, if a local
bank officer screwed up, his bank went under. Bad bankers paid the
price at the local level. Under the Fed, incompetent bank officers
get bailed out and hang around. Their lousy loans ultimately get bailed
out by an increase in the money supply or by government bailout (as
in the case of the S & L crisis of the late 1980's). Either way,
whether through inflation or direct government subsidy, it involves
some form of subtle or direct taxation of average Americans.
Predictably, centralization has also created a byzantine nest that
is perfect for unscrupulous people to game the system to their advantage.
The economist John Kenneth Galbraith commented in 1975 that "The
study of money, above all other fields in economics, is one in which
complexity is used to disguise truth or evade truth, not to reveal
Privilege: How the Monetary Elite Benefit at Your Expense
Vincent LoCasio summarizes special privileges that no other industry
in America can remotely match. I have provided his list from pages
199-200 in boldface below, and have added some of my own comments.
: The right to create "money" out of thin
air was given by the original Constitution to Congress, not to central
bankers, but today only the bankers have the privilege of creating
money. The Fed Chairman used to be kind enough to inform Congressional
representatives about money creation numbers after the fact. After
March 2006, the Fed no longer reports M3 growth to its camp followers
on Capitol Hill. (Fed chairman Ben Bernanke told Rep. Ron Paul that
it is now too expensive to keep records!) Of course money creation
without prior scrutiny and approval by people's elected representatives
is a form of taxation without representation since it takes purchasing
power out of the hands of taxpayers just the same. To add insult to
injury, under a fractional reserve system, "...banks are then
allowed to create multiple dollars of liabilities against themselves
for each dollar of Federal Reserve Notes that they have." (LoCascio,
2. Asset protection (discount
privilege at the Fed)
According to LoCascio, (page 199) "If
the Fed so chooses, it can guarantee the assets of any bank by buying
the banks's assets at their time adjusted face value. Since the Fed
has an unlimited ability to do this, no bank, no matter how poorly
managed, can ever fail if the Fed merely chooses to rescue it. To
date, the Fed has favored taxpayer bailouts, instead. The effect is
essentially the same." I might add that when member banks start
to get into trouble, the Fed can also drop the discount rate at which
banks borrow money from the Fed. Banks and take this money and loan
it out at higher rates. Their loan rates typically decline less than
the discount rate. This is particularly true of credit card interest
rates. All of this means increased profitability for the banks. In
other words, this is a cartelized industry whose head can arbitrarily
provide guaranteed increases in profit margins. This creates moral
hazard by encouraging even more reckless lending, which in the long
run increases financial system instability and the likelihood of deep
recessions once the need to write off bad debt and mal-investments
inevitably leads to a credit squeeze.
3. Liability protection
, Started in the 1930's, "deposit insurance"
was raised well ahead of the rate of inflation to $100,000 per account
in 1980. No doubt "deposit insurance" sounds wonderful and
"common sense" to the average person at first sight, but
we need to remember that over the long run in economics, there are
never any free lunches. This "insurance" is actually a taxpayer-guaranteed
bailout. The losses typically come from bad loans created by reckless
or incompetent loan officers. The perversity comes from the fact that
whenever a bank can slap on the FDIC label and simultaneously offer
the highest interest rates —
no matter how speculative the underlying loan portfolios are in nature
will typically bring in the most assets while luring assets away from
more prudent portfolios... This also helps accelerate the trend where
loan officers are no longer likely to carefully select and monitor
borrowers in their local communities, but instead they quickly package
and swap loans among other financial institutions in an impersonal
way. This decouples loan origination officers further from direct
responsibility and accountability and adds even more system risk.
As a consequence of all this, FDIC "insurance" has actually
increased the long term failure rate —
as well as the mega-sums involved in taxpayer-funded bailouts. One
of the biggest recent whoppers was the Savings & Loan industry
of the late 1980's that cost taxpayers over $160 billion dollars.
4. Rescue missions (bailouts
and the like)
Banks have become so powerful that "too
big to fail" often means too big to be missed by Congressmen
who depend on their campaign contributions and junkets. LoCascio summarizes
on page 200: ""Various taxpayer bailout schemes permit the
banks to pay no attention to the risk of any enterprise —
no matter how stupid —
particularly if they all act in concert with each other. By acting
whether it is lending to Mexico, South-East Asia, Donald Trump, or
Long Term Capital Management —
they can virtually guarantee they will be rescued if things go wrong."
5. Accounting irregularities
According to LoCascio (p. 200): "Accounting rules allow banks,
and only banks, to carry investments at acquisition cost when the
current market value is lower. This unquestionably perverts the bank's
true financial health. No rationale for this is plausible. Other rules
are similarly perverse and distort reality. In addition, regulatory
bodies and politicians intervene with their own irregularities whenever
such intervention is required to protect these inherently unsound
and unstable institutions."
6. Secrecy rules
According to LoCascio (page 180),
Some special privileges relating to secrecy were
built right into the original Federal Reserve Act of 1913. For example,
the act provided for a body called the Federal Advisory Council
(FAC). Directors of the Boards of the Federal Reserve Banks select
the members of FAC. Today, FAC members consist of the top management
of banks whose combined assets exceed $1 trillion. These members
meet regularly with the Board of Governors, in secret and without
oversight, to air their concerns and provide advice. No other regulatory
agency meets in secret like this with the entities it regulates.
Other special treatment relating to secrecy was built into subsequent
legislation. For example, most federal employees are provided whistle
blower protection for revealing criminal or fraudulent activities
that they come across in the conduct of their jobs. Bank examiners,
however, were specifically denied such protection within the provisions
of FIRREA —
and act supposedly dedicated to bank reform.
If all of this is beginning to sound like a big scam, well, join the
conspiracy theorist club. None of this should be a surprise for anyone
who has read about the real history of the Fed. An excellent and extremely
well-written primer is The
Creature From Jekyll Island by veteran investigative journalist
G. Edward Griffin.
The Fed was a the brainchild of Paul Warburg, a Rothschild agent who
got together with Morgan and Rockefeller interests (themselves confederates
of elite Jewish banking families) to adapt European central banking
schemes to America. The reality of their system today has become the
exact opposite of the decentralized financial system championed by
American patriots such as Thomas Jefferson and Andrew Jackson.
Centralization has led to exponential increases in total system risk.
For starters, the Fed has completely abandoned all 19th century standards
of rectitude regarding sound money and credit. Unfortunately under
"globalization" other foreign central banks have followed
the Fed's leadership, creating a massive global problem rather than
just a U.S. problem.
Ever since the Nixon Administration de-linked the dollar from gold
in 1971, the entire industrialized world has headed down the path
to our present situation where the entire world is floating on nothing
but a sea of fiat-money paper.
Worse still, not only has the international community abandoned gold
as an anchor point for currency exchanges, but in the place of gold
it has substituted unregulated derivatives as devices to hedge currency
and other forms of risk. Billionaire investor Warren Buffet has referred
to these derivatives as "Weapons of Mass Financial Destruction."
They have swollen to over $200 trillion, or over twenty times the
size of the U.S. economy.
In contrast the old gold system was simple and robust. It was based
on the intrinsic worth of gold itself, and carried no implosion risks.
Derivatives are nothing but paper contracts designed to hedge against
uncertainties. Many market professionals are gravely concerned that
if a market crash turns into a panic, many of these instruments can
become completely illiquid. We saw a good example of irrational market
behavior during the Russian default and Asian crisis in 1998. Investor
behavior fundamentally changed much like the way water turns to ice
with the right reduction in temperature. Normal trading ranges between
many financial instruments evaporated or even became inverted, leading
to massive losses. One of the worst hit hedge funds was Long Term
Capital Management, which had been founded by several nobel laureates.
This failure threatened to wipe out some major banks before the Fed
intervened with a bailout program.
So many major U.S. money center banks and large corporations are now
loaded with debt and derivatives that their capital structures resemble
hedge funds. The Fed has done nothing to curb the growth of unregulated
derivatives. This is probably because hedge funds widely use them.
These hedge funds aid Fed manipulation by using their instruments
to transmit Fed short term rate reductions into long term rate reductions
in bond markets. The hedge funds are also are significant customers
for major Wall Street firms, who also enjoy an incestuous relationship
with the Fed.
According to the report "Move
Over Adam Smith: The Visible Hand of Uncle Sam" by John Embry
of Sprott Asset Management in Canada, the major investment firms also
receive massive infusions of funds from the Fed via its "Repo
Market" which they use to manipulate major markets to the mutual
advantage of both the Fed and the investment firms. I discuss all
of this in greater detail in a paper I wrote in July 2003 about Fed
desperation and intervention wizardry when I once worked as a
full time stock broker and investment strategist.
As total system risk builds towards a final blow out, it remains a
wonderful life on planet Krypton, U.S.A. for individuals near the
top who enjoy high salaries, bloated consulting fees and lecture honorariums.
It is also a criminally wonderful life for those within their confidence
who can trade on inside information. In this world of fluctuating
fractional reserve ratios and discount rates and other forms of central
bank manipulation, there are all kinds of wonderful, sneaky opportunities
for insiders to continuously carve out little percentages for themselves
out of big pots of money and bury the evidence within piles of complex
In contrast, it is not such a wonderful thing for common citizens.
The purchasing power of the dollar bills in their wallets will continue
to decline towards zero as the Fed continues to use its money creation
powers to bail out bad loans, shaky derivatives, disintegrating banks,
blown up hedge funds, and other problems related to banker recklessness,
incompetence, and dishonesty.
Overall, the damage done to America has been far greater than if we
had continued to quarantine failure at a local level by allowing local
banks to fail, as barbaric as that practice may seem. We would also
be far better off today if we had stayed with a gold and silver based
money system that remained out of the hands of politicians and central
bankers, as primitive as that system may seem as well.
Personally speaking, I greatly prefer the relatively primitive but
robust and thoroughly reliable precious metals-based financial system
without a central bank or fractional reserve lending that characterized
America in the 19th century to the hyperinflationary blow-out regime
we are likely to see in the not too distant future.
Total system risk and military alliances
There is an interesting analogy between the way system risk is consolidated
and magnified in the banking world, and the way "war risk"
is similarly pooled and magnified today with America's entangling
Initially, creating a lot of military alliances may seem like a great
idea. After all, the more allies one has, the more likely it is that
one might defeat an enemy.
However, creating large numbers of entangling alliances can appear
threatening to foreigners. In the longer term, it may encourage the
creation of larger counter alliances among potential enemies than
would be the case without making provocations.
In addition, once large entangling alliances are created, it is much
easier for a relatively small localized war to suck in other, entangled
powers, and quickly escalate into a major war. The Balkans conflict
that ignited World War I is a prime example.
Dr. Hans-Hermann Hoppe points out that during the Middle Ages, when
Europe was much more fragmented, the wars tended to be much smaller,
more localized, and more likely to be fought by professional armies.
As mentioned previously, the European countries tended to be run by
monarchs and their relatively small advisory councils. This "privately
owned" government had a much greater sense of long term caretakership.
They were far less inclined than social democrats to agitate, regulate,
mobilize, or socially experiment with their own people.
In contrast, in our so-called modern era of social democracy, countries
are more likely to fight "peoples wars" or total wars with
mass conscript armies. Social democracies typically bribe the loyalty
of their mass citizenry for war through social security legislation
and other benefits, hence the meaning of "welfare-warfare"
in the phrase "neo-Jacobin welfare warfare state" that libertarians
use to describe America today.
Contemporary social democratic governments have central banks whose
fiat currencies can be readily inflated to help fight total wars to
complete national exhaustion. Social democracies have proven every
bit as much, if not more adept than the old constitutional monarchies
at using alliances to escalate conflagrations, even to the levels
of World War II.
Incidentally, the American social security system was largely inspired
by German Chancellor Otto von Bismarck's social benefits system. Bismarck
openly defended his system as a tool to politically bribe workers
within the unified German state into feeling a sense of obligation
towards military service for his imperial war machine. He also wanted
to head off progressivist platforms by implementing his own social
programs. This is one of the ways that "welfare" and "warfare"
government spending originally fit together.
Also, getting back to my discussion of ponzi government and evil government,
the existence of entangling alliances and a large standing military
typically present a chicken and the egg problem. Major media condition
us to think that first there is a legitimate threat, and then America
goes looking for alliances as a second step to meet a real threat.
Many libertarians believe that the underlying reality is usually the
reverse. They argue that the neo-Jacobin welfare warfare state goes
looking for trouble first before reacting to it. The superstate needs
entangling alliances and enemies as an alternative to undergoing the
pain of downsizing government and the military-industrial complex.
As one example, a number of Mises Institute lecturers claim that the
CIA wildly over-inflated the Russian economy and military expenditures
during the Truman Administration in order to help keep the American
military budget artificially bloated.
Back to political separatism as a possible
Dr. Ralph Raico, in his lectures on classical liberalism, believes
that the fragmentation of Europe in the Middle Ages following the
collapse of Rome was a good thing for the cause of liberty, because
it preserved for people the right of exit to deter tyranny. With more
countries competing against each, it was easier when things soured
in a particular country for people to move to another country with
better laws and tax policies. This put pressure on rulers to refrain
from tyranny in order to retain productive people.
Dr. Murray Rothbard believed that if North America had divided itself
into numerous independent countries, the wars that might have followed
would have likely been relatively small and highly localized. In contrast,
while united in megastates, Americans and Canadians have been sucked
into very expensive large-scale wars overseas. Dr. Rothbard pointed
out that it did not make sense that Americans would fight to save
the union in order to save America from future internal wars when
the price tag of 640,000 people killed seemed to be far greater than
the likely costs of all the future wars in the next century that unionists
were ostensibly trying to avoid in the first place.
In regard to entering World War I, a divided North America would have
been less likely to have overwhelming gone over to either side. In
fact, there is strong evidence that if America had stayed out of World
War I, the European combatants would have declared an armistice by
1917 rather than fight on for nearly two more extremely bloody years.
Prolonging the war cost millions more lives and vastly more treasure.
It created the onerous Versailles Treaty peace terms and conditions
of total exhaustion that encouraged the rise of Bolshevism, Nazism,
and Fascism, and ultimately the resumption of World War I in the form
of World War II.
Contrary to the Unionist argument that if North America divided into
many independent countries, that they would all be fighting with each
other, we might consider cases where the opposite is true. Many small
Scandinavian countries and many small central European countries such
as Switzerland and Liechtenstein have enjoyed very long periods of
peace. Many German principalities during the late Middle Ages when
Germany was highly fragmented also enjoyed relatively long periods
of peace. The same was true for quite a few provinces of France and
Italy which enjoyed high degrees of autonomy for many centuries up
until around the 19th century.
These ideas provide important background for when I discuss the anti-Federalists
in my History Reinterpreted section. These are the same folks who
played a key role in demanding our Bill of Rights.
The centralization vs. decentralization debate in religion
In my Rev Ted Pike archive, the good reverend provides detailed examples regarding the persistent campaign by the totalitarian Jewish ADL to suppress freedom of speech in America. In that section I also describe the very artificial nature of Christian Zionism, whose forty million adherents in America have supported highly contrived and unwise military crusades in the Middle East that threaten to drive America into total bankruptcy and hyperinflationary melt-down.
In the last two sections of the Rev Pike archive, I make the following overview comment:
The U.S. Declaration of Independence explicitly talks about "Nature's God." Many early American leaders such as Thomas Jefferson, Benjamin Franklin, Tom Paine, and George Washington regarded themselves as Deists, which to many people today would be considered more pagan or agnostic/atheist than Christian. I would classify their views as more in the "natural religion" camp than in the "dictated" or "revealed" (or "scriptural-authoritarian" or "messianic") religious arena. They felt that while a supreme entity may exist, if it did in fact exist, it only operated within the confines of natural law and did not engage in supernatural intervention. In fact to help make this point, Thomas Jefferson went through the four Gospels and deleted everything that involved supernatural events, creating what is known today as the Jefferson Bible.
In my centralization vs. decentralization discussion, I talk about "natural" (decentralized) vs. "dictated" (authoritarian) forms of politics, "natural" (laissez-faire) vs. "dictated" (or "fiat" or "centralized") forms of money and economic theory, and "natural" ("decentralized" or "folklorish" or " indigenous") vs. "dictated" (or "authoritarian" or "revealed" or "messianic") forms of religion. There is a common intellectual thread involving important decentralization vs. centralization themes that runs throughout all these areas. These areas interrelate with each other, so that political attitudes in one area often spill over regarding the way people treat issues in other areas. So much so, in fact, that it would be a major error of omission and completely intellectually dishonest not to point this out.
There is a tendency to associate "natural" religion with "paganism" and "heathenism." This association is in some ways accurate and in other ways overly simplistic at the same time.
Interestingly enough, the word "pagan" comes from the Latin paganus" which meant "pertaining to the country," and similarly "heathen" meant "from the heath" which again implies a more rustic "countrified" form of religion. Both terms imply religious practices, beliefs, and folklore that have tended to spontaneously evolve among people who live in a more primitive, decentralized, tribalized, and rural environment.
The social significance of the pagan-rural connection
There is a strong "urban" connection behind Judaism and Christianity. This urban connection influences the authoritarian nature of "revealed" religions. It is important for me to fully explain the social implications of "urban" vs. "rural" and how this can ultimately impact on the nature of religious ideologies. There is also a very important criminal-parasitic dimension involved here that I will also discuss.
Compared to city people, country folk have always tended to live a harder physical life that is closer to nature. They have tended to be more heavily focused on the creation of tangible goods and their use in honest trade. They have typically been involved in such physical occupations as farming, herding, hunting, wood-cutting, and fishing.
In contrast, people who live in cities are more likely to make their living acting as middle-men and by providing services that have intangible as opposed to tangible value. This can create lucrative opportunities for con artists who live by their wits and by trickery. In addition, in a crowded environment, it is much easier for deadbeats to find exploitable altruists. Lastly, in a crowded environment, it is much easier for parasites (criminals) to find a steady flow of dupes to be their victims.
Some examples of urban occupations that might provide cover for parasitic exploitation operations include merchants, brokers, lawyers, prostitutes, gangsters, bankers, and privileged classes of professional priests, mercenary military guards, and politicians.
Please also bear in mind that large cities and their accompanying urban sprawl tend to be much more centralized in their operations than country settlements. The process of architectural planning, providing water and sewer services, operating police, carrying out the garbage, and myriad other tasks required to successfully operate a large city often require much more centralized forms of social organization, planning, and coordination than living in a small town in the country. Just as all of the physical structures are man-made, similarly the myriad structure of rules and regulations in cities tend to reflect convoluted piles of politically motivated, man-made expediencies piled on top of each other that are often devoid of ordinary human common sense.
The city environment can be very "unnatural." On a Darwinian level, it tends to create unusual niches removed from a natural environment that encourage the genetic survival and propagation of very unnatural types of people with bad instincts and bad character. These types of people may include sexual perverts, homosexuals, gangsters, con artists, mafiosa, and other criminals.
Thomas Jefferson idolized American farmers as a mainstay of solid, traditional American values and American democracy. He disdained city slickers and such highly urbanized creatures as central bankers. However, I do think that he explicitly called attention to the genetic propagation problem.
The American population expert Dr Elmer Pendell delved into the dysgenic aspects of urban environment in his classic work Why Civilizations Self Destruct. He felt that urban environments can actually reverse human evolution. Instead of helping to create the kinds of intelligent and fit people who have evolved under dispersed condition in the cold natural environments of northern Europe and northern Asia, urban environments tend to breed less intelligent, less noble, and less productive elements of society.
According to Dr. Pendell, because civilizations in essence reflect the accumulation of problem-solving improvements, they tend to go into decay and eventual collapse when the ratio of nonproductive, problem-creating people begins to vastly exceed the proportion of productive, problem-solving people. Non-productive people include smart criminals in addition to lazy or stupid people. (I explain Pendell's views in greater detail in my environmental vs. genetic discussion).
At this point in my discussion, let us take a look at some sleazy urban specimens.
For Exhibit A, let us consider former New York City mayor Rudy Giuliani. Please note where he acts like a transvestite homosexual when he playfully bitch-slaps Donald Trump on YouTube. The fact that he was very close to the unfolding events of 9-11, yet continues to help the Bush administration cover up its false official story, gives this false gender act a diabolical tinge.
For Exhibit B, please consider World Trade Center landlord Larry Silverstein when he talks about "pulling" WTC 7.
Talk about chutzpah! Larry Silverstein failed to discuss how he got billions of dollars in insurance coverage within months prior to 9-11 in order to subsequently cover all his losses. Nor did he discuss the mysterious work crews seen inside his Twin Tower buildings shortly before the disaster. Nor did he discuss why Building 7, with no visible structural damage, would need to be "pulled" on the same day of the 9-11 disaster. Nor did he explain how Building 7 could be pulled without weeks of prior preparation by professional demolition crews --which surely he would know about in advance as the landlord. Please go to the 9-11 section of Whatreallyhappened.com or my audio archive and site map sections for more details about Larry Silverstein and various other Israel-related anomalies. Please also see the Col Donn de Grand Pre archive.
The 9-11 operation was probably run by the Mossad with the aid of a compartmentalized segment of the CIA, very similar to what Michael Collins Piper documents in Final Judgment regarding the JFK assassination. These gangsters are not exactly like your average farmer Jones who lives along your typical rural route in the corn belt.
The country vs. urban dichotomy is very useful as more specific variation on the broader decentralization vs. centralization theme. The reason is that over time, religious theologies tend to reflect the social structure of their underlying society. Many pagan religions have tended to become more authoritarian as their underlying populations have become more urbanized or imperialistic.
For example, as certain pre-Christian societies in Mesopotamia, India, and the Americas became increasingly stratified and authoritarian, their "pagan" religions also became much more authoritarian in nature. Late-stage Mayan and Aztec civilizations that engaged in massive cannabalistic sacrifices are extreme pre-Christian examples in the Americas.
One example of authoritarianism creeping into paganism in pre-Christian Europe involved the transition of ancient Roman from a limited republic to an empire. When Julius Caesar conquered Celtic tribes in France, he would often try to kill off their Druidic priests to root out any forms of localized religious nationalism that might challenge imperial Roman rule.
Throughout the ages many conquerors have sought to destroy the natural religion of a subjugated people and replace it with their own religion for psychological warfare purposes. Although Caesar lived in pre-Christian times and hence is viewed as a worshipper of pagan gods, his pagan brand of religion was clearly more authoritarian, stratified, and imperialistic than that of many of the peoples his armies subjugated.
It is also important to note how many "revealed" religions have absorbed significant pagan elements. For example, in her book The Christ Conspiracy: The Greatest Story Ever Sold the author, Acharya S., compiles quite a lot of free thinker literature and insights on the pagan origins of a large portion of Christian practices and theology. (See also my Rev Ted Pike archive for more discussion by myself of this issue). The American Atheist at atheists.org hosts quite a few materials that identify "pagan" elements in Christianity. See also, for example, The Pagan Origins of Christmas by Paul Angel in the Nov/Dec 2006 Barnes Review. I might add that in addition t Christmas, there are also strong pagan elements behind Easter and All Saints Day (Halloween) as well.
At the other end of the spectrum from the natural religions are the "revealed" or "messianic" religions. The three prime examples are the three "semitic" religions Judaism, Christianity, and Islam.
In regard to Judaism, the late Israeli writer Israel Shahak remarked in the chapter "Political Consequences" of Jewish History, Jewish Religion: The Weight of Three Thousand Years, that “It should be recalled that Judaism, especially in its classical form, is totalitarian in nature.” (Please see my detailed discussion of the adverse side of Judaism in my mutualism vs. parasitism section).
Not surprisingly, as a largely Jewish-created religion, Christianity has also generally been very centralized and dogmatic throughout its history. Throughout the Middle Ages in many countries such as France and Italy the Christian Church controlled over a third of all land. Through its father-confessor system it was often able to produce better intelligence than the Gestapo or KGB to help keep authoritarian rulers in power. The role of the Catholic Church in conducting or suppressing public education in many Latin countries was so horrible for so long that this point alone was a major complaint of many secular revolutionaries throughout the 19th and 20th centuries.
A major reason for the Protestant Reformation was not only a protest by Northern European countries against the corruption that came from excessive centralization and political power wielded by the Vatican, but also to exercise more local autonomy on all levels, to include individualized theological interpretation as well as local political and economic control.
There are some interesting analogies here involving the political and economic arena. For example, America today essentially has a one party system consisting of "Republicrats" (or "Demopublicans") who are fundamentally united for defending the interests of Big Government and pork for politicians and "green" for special interests. As soon as a third party movement gains traction on an issue, it is typically for professional politicians who happen to call themselves Republicans or Democrats to suddenly "discover" the third party issue as if they have advocated it all along, coopt it, and steal the thunder of the third party to put them out of business.
Similarly, in the corporate world, it is always amazing to me how big natural resource companies are incapable of finding reserves compared to small entrepreneurs. Similarly, large technology companies seem to have major problems coming up with fresh new technologies compared to independent inventors and small companies. Once the little guys come up with something good, the big guys typically swoop in with cash and try to buy them out or else steal their ideas.
Similarly, Christianity has typically functioned like a "McDonalds," "Coca Cola," or "IBM" of religion, coopting pagan ideas and practices where it might suit its agenda, and then "franchising" out its operation around the globe.
Centralized religious systems tend to be more standardized. If one walks into a Catholic Church or a major Protestant denomination, one might not necessarily agree with every jot and tither of their theology, but one at least has a pretty good idea regarding what one will get in the way of religious services. This is analogous to walking into a franchise operation like a Kentucky Fried Chicken or Taco Bell. When you have seen one, you have seen them all.
On the other hand, many pagan groups are analogous to a Mom and Pop restaurants or small businesses in general. Since most pagan groups in America are relatively small and new, a person usually has to spend a lot more time doing his own research to get a handle on what what he is getting into. One positive aspect of this situation is that it can help motivate an individual to learn more about the folkways and indigenous culture and religion of his or her own people as well as gain a greater understanding of comparative religious studies.
Some pagan groups have smart, honest, and decent people. They act out of genuine conscience and sincerely wish to do good things. They may have the potential to provide a custom fit with ones personal religious needs that can be superior to most prevailing organized religions.
On the other hand, the term "pagan" is so broad that it can encompass people with political views and ethical and social orientations that are virtually anywhere at any point on any spectrum. It is quite possible that a "pagan" group might also involve socially undesirable and even psychopathic people who are simply trying to use religion as camouflage to do very selfish, hedonistic, outrageous, and even destructive things. Some of these types of groups can be quite a bit worse than the average organized Christian church. Therefore caveat emptor; look before you leap.
As another consideration, sometimes the fact that pagan groups are by definition a small minority within a society dominated by Jewish supremacists and Christians, this by itself alone can create some viscious circles. When certain groups are marginalized, whether they deserve to be marginalized or not, they might tend to attract marginalized types of people who tend to keep the groups marginalized.
However, since pagan groups in America are generally highly fragmented and decentralized, it is unlikely that even bad groups can ever do very much damage. Whenever certain pagan groups go off the deep end and do destructive things, it tends to be very localized and containable.
In contrast, forty million American Christian Zionists combined with the influence of ultra wealthy organized Jewish groups (see The New Jerusalem by Michael Collins Piper) have created a very powerful political force that threatens to destroy America as we know it today.
Towards the end of the Rev Ted Pike archive, I discuss the specific example of a pagan movement that involves the revitalization of the indigenous old Norse religion called Asatru. I see an analogy here involving computer software that is worth mention.
I would compare Christianity to the Microsoft Windows operating system. It is very much a pre-packaged and user-friendly system. It is very "top down" in its origination. It is also filled with lots encoded software packets and security holes and "back doors" that create ample opportunities for computer viruses.
In contrast, Asatru is more of an "open source" religion analogous to the Linux operating system. As a tribal religion based on tribal folklore that has typically evolved in harmony with nature and natural law, it is possible to be very secular and rationalistic in ones outlook and be religious at the same time. One can construct ones Asatru views on religious software "kernals" that conceptually fit a scientific worldview. (See, for example, The Religious Attitudes of the Indo-Europeans by Dr. Hans Gunther or Beyondism: Religion From Science by Dr. Raymond Cattell). Just as Linux has a very robust, hard kernal software base that is highly resistant to computer viruses, similarly a natural religion that is fully compatible with a natural and scientific world view can be very resistant to disinformation ideological attacks.
Incidentally, as an aside, Confucianism is an interesting example of another natural religion that evolved as a ethical philosophy that does not require a belief in supernatural intervention. It can also be highly compatible with a scientific, naturalistic worldview.
Shintoism is another example of a natural religion that many Japanese treat nonliterally as "truth in poetry," and also many interesting similarities to Asatru as a folk religion.
The natural religion approach tends to require a lot more independent analytical thought by people to study it and get the hang of. This is comparable to trying to learn a programming language on the source code level compared to dealing with a highly compiled, highly packaged Microsoft software product or a What You See Is What You Get (WYSIWYG) software interface.
Natural religion tends to evolve from intuitive connections that people tend to naturally make with their physical environment. For example, since lunar cycles tend to roughly correspond with menstrual cycles, in many cultures the moon is usually associated with some kind of feminine spiritual entity. In northern hemispheres, winter is a time of darkness and cold, therefore winter is typically associated with death. Summer, which is sunny and warm, is associated with life. A period between the summer solstice and winter solstice, such as Halloween (or Samhain in Celtic culture) hence takes on an intuitive association as a time that is halfway between life and death and hence a good time to try to communicate with the dead or reflect upon ones ancestors. Conversely the Easter period, which is halfway between the winter solstice and summer solstice, is intuitively associated with death being turned into life, or the creation of new life, and hence tends to have intuitive religious associations with fertility (creating life) or death transforming into life (resurrection or rebirth).
Getting back to my Linux analogy, by studying the evolution of natural religion, one begins to understand how original ideological "source code" has evolved into into contemporary religious theologies. Books such as Cannibals and Kings: Origins of Cultures by University of Florida Anthropologist Marvin Harris also help us understand how practical social-political considerations might become embedded as enduring religious practices over time. In addition to this type of analysis, one can also look at how religious theologies have been coopted, reinterpreted, and reengineered over time by various intellectual or power elites to perform various social revolutionary, economically exploitive, or militaristic-imperialistic purposes.
As an example of the adaptation of religion for social revolutionary purposes, in his famous work The Anti-Christ, the philosopher Friedrich Nietzsche charged that Christianity was deliberately promulgated as a psychological warfare weapon by Jews to invert or "transvaluate" the healthy instinctive values of Romans as revenge for the Roman destruction of the Jewish Temple. These Jews also wanted to turn the Roman Empire on its head for nihilistic social revolutionary purposes. With its emphasis on "other worldliness" and its scoffing at pragmatic Greek philosophy (or "sofia"), Christianity was a left wing attack on the pragmatic, right wing virtues that had helped Greeks create science, democracy, and republicanism five centuries before the alleged time of Christ. These values had also helped foster the rise of Greek and Roman economic and military power.
In his classic work The Decline and Fall of the Roman Empire, Sir Edward Gibbon expressed a similar viewpoint to that of Nietzsche. Gibbon felt that Christianity did more to accelerate the decay of Rome than preserve the best of Roman civilization. In other words, Christianity was a piece of malevolent radical left wing, mystical religious software promulgated by some ancient Jewish punk intellectuals. They often used naive gentile disciples who might get thrown to the lions to act as their "script kiddies" to spread their ideological "computer virus" throughout the Roman Empire.
Interestingly enough, even a Jewish writer named Marcus Eli Ravage echoed Nietzsche and Gibbon in the article "The Jew: Commissary to the Gentiles; The First To See the Possibilities of War by Propaganda" that he published in the Feb 1928 issue of The Century Magazine in America. It is well worth reading.
In a similar subversive spirit, this is not a whole lot different from the way Jews in the 19th and 20th century would later fund and lead Marxist movements in Europe to try to subvert gentile societies with Bolshevism. Nor is really much different from the false flag operations run by the Mossad that Michael Collins Piper documents in Final Judgment. As they say, the more things change, the more they stay the same.
Lest my criticisms of Judaism and Christianity may seem too harsh, I also recognize that there exist very degenerate and perverted forms of natural religion and pagan movements just like there also exist very degenerate and perverted branches of Christianity and Judaism. One reason is that over time psychopathic people are often able to infiltrate and corrupt for their own selfish purposes virtually every type of religious and political system known to man.
John De Nugent wrote a great article about the important historical role of psychopaths in the Jan/Feb 2007 issue of The Barnes Review. In his review of the Mel Gibson movie Apocalypto, he characterizes the pagan Aztec religion as one of the most bloodthirsty, sadistic, and psychopathic religions ever developed by homo sapiens.
As some examples of Christian degeneracy regarding the Catholic Church I can reference medieval witch burnings and the Vatican practice of selling of indulgences. Note also the recent pedophilia scandals involving certain Catholic priests.
Regarding Protestantism, we might consider the late Rev Jim Jones' brand of Kool Aid, or the Christian Zionism espoused by people like the late Jerry Falwell which is driving Americans like lemmings towards national self-destruction.
As some examples of questionable practices by adherents of the organized Jewish religion, we have the suppression of free speech by the ADL (please see the Rev Ted Pike archive), the JFK assassination, promotion of out of control Third World immigration into America, the assault on the U.S.S. Liberty, the likely culpability of Israel in orchestrating 9-11, the shanghai of American foreign policy into a Middle East quagmire under the High Priests of War, the torture of Palestinians, the Jonathan Pollard treason, the conversion of American into a bankrupt globalized casino economy, Jewish domination of organized crime and pornography in America, the massive Jewish support for Bolshevism in the early 20th century...it is very long list (please see Col Donn de Grand Pre's The Viper's Venom for more details).
The strong "urban connection" behind Judaism and Christianity
It is important to note how both Judaism and Christianity have very strong urban origins. The Old Testament tales that portray Jews as a pastoral people in Palestine are highly suspect as real history, as John Tiffany pointed in his article Ancient Israel: Myth vs. Reality (May/June 2007 issue of the Barnes Review). (Incidentally, he also raises questions about the historicity of Jesus in his article New Revelations On the Life of Jesus, Nov/Dec 2006 issue, and also the historicity of the Wailing Wall in The Myth of the Wailing Wall for the March/April
When one looks at independent sources on the ancient Jews, a totally different picture emerges from the way Jews describe themselves in their own literature. The one exception to this is that if one is intelligent and knowledgeable enough to be able to read between the lines, much like Rev Ted Pike, even the Jewish literature itself provides important internal evidence regarding the real nature of sociopathic Jewish leaders.
Independent historical sources portray the Jews as a people who evolved out of the highly urbanized setting of Babylonia, not Palestine. They spread across the major urban areas of the ancient world in small colonies and were known for their ability to use covert, gangsterish practices to dominate businesses. In ancient times, just like today, they were known for their deceitfulness, proclivity towards financial speculation, and domination of organized crime.
In ancient Rome, Jews dominated the slave trade. (They also dominated the Negro slave trade from their home base in Newport Rhode, Island in colonial American, and today they are a key player in the white slave trade operated out of Israel as well as pornography industries in America). They were hardly characterized by gentile contemporaries as a specially noble and virtuous people chosen by God to be a light to the world. In fact, quite the opposite. I discuss some of these sources in my Rev Ted Pike archive page and also in my mutualism vs. parasitism discussion. Among other things, I note that the First century Roman philosopher Seneca commented in De Superstitione: "The customs of that most criminal nation have gained such strength that they have now been received in all lands. The conquered have given laws to the conquerors."
Also, contrary to the vast number of Bible movies on American TV that portray early Christians as well-meaning humble gentiles only one step away from being fed to the lions, many independent historical sources portray early Christianity as a phenomenon sponsored by wealthy urban Jews who had gained financial supremacy in many parts of the Roman Empire. It's core adherents were often highly urbanized, wily Jews who needed a universalistic religion that helped them to interface with the gentile public and defuse their concerns about Jewish exclusivity while at the same time exalting Jewish tribal history and "chosenness." All the unfavorable material in the New Testament about the Sanhedrin framing and crucifying Jesus is both a "limited hang out" and a "red herring" compared to the greater gain for the Jews that came from promoting a universalistic religion that simultaneously detribalizes and destroys gentile natural religions (and their resistance to alien invasion) and exalts Jews as special "holy" people entitled to take positions of influence within gentile nations.
In all of this discussion, I do not mean to imply that all Christians are bad people or that Christianity as it is practiced by middle America today is necessarily a bad religion. I believe that quite a few Christians are well-intentioned people with good instincts. I think that a lot of Christian churches do good things for their communities. I also think that there are a lot of good things embedded inside Christianity along with quite a few things that I find very negative.
I also do not believe that all Jews are genetically evil psychopaths, or that their desire to retain a tribal religion is necessarily a bad thing. To the contrary, so long as Jews do not act like gangs of predatory criminal piranha, I think that preserving a tribal religion and folk traditions can be very healthy. In fact, I wish more of my own fellow whites would show an interest in preserving their own indigenous Indo-European religiosity, European cultural folk roots, and racial integrity. My big problem regarding Jews in general is that Reform Jews, dissident Jews, and anti-Zionist Orthodox Jews seem to be continually unsuccessful in preventing Zionist criminal crazies from rising to the top and getting completely out of control.
What I do wish to promote is the ability of individuals to become more savvy "consumers" of religious "product." I think that most organized religions, to include Judaism, Christianity, and Islam, can be analogous to eating overly refined junk food sold by major corporations who are out to skim profits at the expense of public health. Most food sold by big meat corporations have too many toxic hormones and chemicals embedded in them. Most big fast food chains sell food with way too much saturated fat and sugar. Just as I believe that one should be very selective and increase ones servings of unpackaged, unprocessed, raw foods to stay healthy, it also helps for one to supplement his diet of organized religion with some knowledge about natural religion, scientific skepticism, and traditional white folk culture.
Getting back to my discussion of the short term vs. long term tradeoffs of a natural vs. fiat money system, one can make a similar analogy regarding natural vs. a revealed religion.
For starters, sociobiologists might argue that people have evolved to have subjective religious instincts because this helps them pass on their genes compared to those who lack this trait. Religion is ultimately a genetically-based form of group altruistic behavior that supports long term group survival.
While one may feel a very strong subjective religious instinct, one might also recognize on an intellectual level that no one has ever been able to scientifically prove the existence of God. This fact alone suggests that as revealed religions become increasingly authoritarian and dogmatic, they run an increasing risk of becoming completely decoupled from reality. They also increasingly undermine the ability of their adherents to make rational decisions.
Therefore, while a decentralized natural religion may have less dogma and theology, and hence be a bit harder to practice in the short run, in the long run it does much less damage to the ability of people to act rationally in order to successfully adapt and improvise. This is analogous to the way a hard money system also requires more self-discipline, responsibility, and foresight on a grass roots level to successfully implement, but is vastly more stable and honest in the long run than a fiat money system.
Conversely, revealed religions, with their greater dogma, theology, and authoritarian structures, offer more comfort and the appearance of greater certainty in the short run. This is analogous to the way central bankers can goose the economy in the short run by inflating their fiat money currency in order to create a false illusion of prosperity. However, just as central bankers tend to addict their economies to increasing levels of fiat money "stimulus," and ultimately create major economic distortions that help lead their countries towards major hyperinflationary economic melt-downs, similarly authoritarian "revealed" religions tend to saturate people with so much mysticism and dogma over time that they are more likely to make disastrous social policy decisions over the long run.
In America today we are suffering a double whammy from both central bankers and fanatical authoritarian religionists. The Federal Reserve is leading us towards a hyperinflationary blowout. (Please see my charts from the Grandfather Economic Report in my Critical Issues section). The Christian Zionist establishment has already led America into disastrous dirty nuclear war (via the use of over 2,000 tons of depleted uranium) in the Middle East. Worse yet, these religionists and their Zionist neo-con allies are not finished. They are now trying to push America towards a disastrous war with Iran.
On top of all of this, the Christian Zionist establishment has also generally supported domestic policies involving open borders, racial integration, and a globalist economic agenda. This has been spearheaded by ADL and other Jewish groups. This has led to the demographic disaster we face internally, where white Americans are rapidly being replaced by nonwhites. The white percentage of the total U.S. population has slipped from 90% in the 1960's to somewhere below 70% today. We lose about 1 to 1.5% a year, and will be probably be reduced to minority status nationwide within a couple of decades given the current "human Katrina" of illegal immigrants that continue to swamp this land. In addition, the white middle class is rapidly shrinking as whites continue to lose more of their jobs overseas to aliens. An important factor involved here is the fact that most white American corporate chieftains feel no loyalty whatsoever towards supporting white genetic survival or maintaining the domestic industrial capacity required for genuine national security and sustainable internal economic advancement.
The will to support the physical survival of ones own people is ultimately a cultural, racial, and religious issue, and not just an economic one. This is an area where many leftist Christian Churches have done more to spread egalitarian ideological poison on white Americans rather than provide pro-survival spiritual guidance.
Many American Christian Churches show similarities to the Afrikaner Church of South Africa. This misguided Christian establishment allowed itself to be conned into supporting Black Marxists who ultimately took control of their country. This formerly white-led and prosperous country has now become such as mess in the last decade that over a million whites have already fled. Young white people in South Africa today see no future in their country. If nothing is done to reverse current trends in America, a similar fate awaits us here as well.
Obviously there are people in high religious places in America who have done more do brainwash white Americans than help them make rational policy decisions rooted in reality. As all of the aforementioned tragic trends play themselves out, we are no doubt in for some very painful lessons in the drawbacks of excessive religious centralization.
Summary regarding top down
vs. bottom up
I think that the libertarian line of analysis
is a vital approach for addressing "top down" vs. "bottom
up" issues. Libertarians tend to focus upon factional conflict,
special privilege, and the erosion of rights. All of these things
are important to know about, although they do not necessarily paint
a complete picture.
It almost goes without saying that ideologically literate Americans
need to understand libertarianism in some detail. After all, the American
Revolution was essentially a libertarian revolution. Libertarianism
has always been an important reference point in American politics.
Paradoxically, selling libertarianism in America tends to be both
too easy and too hard at the same time. It is too easy because just
about everyone will pay lip service to it. After all, how many people
enjoy being lied to and overtaxed by their busy body government or
bossed around by some tyrannical alpha male at work?
The really hard part comes when we try to achieve measurable results
in terms of downsizing government, getting rid of the central bank,
and fighting corrupt special interest groups such as AIPAC, the ADL,
and their spy rings. All of a sudden too many libertarians turn into
weekend warriors and melt away without achieving decisive results.
Americans keep sending one Mr. Smith after another to Washington.
Not long after they take their seats in Congress, in most cases we
keep getting business as usual.
The "fake libertarian" Trojan
Worse than what I have described thus far, every
so often one sees rising leaders who are experts in libertarian philosophy,
who subsequently turn into its most dangerous enemy.
As one example, back in 1966 former Fed Chairman Dr. Alan Greenspan
and Economic Freedom in which he observed:
...Deficit spending is simply a scheme for the
confiscation of wealth. Gold stands in the way of this insidious
process. It stands as a protector of property rights. If one grasps
this, one has no difficulty in understanding the statists' antagonism
toward the gold standard.
Back in 1966 Greenspan belonged to the inner circle
of the anarcho-libertarian guru Ayn Rand. Despite his Jewish background,
one might think that with his strong libertarian philosophical background,
he would be the last Fed Chairman to help fulfill the controversial
Franklin prophecy. (Various Jewish organizations claim this is
a fraud; however, according to various rightist
sources it came from "In Chit Chat Around the Table During
Intermissions," a section of the Diary of Charles Cotesworth
Pinckney of South Carolina. The sole copy of this diary mysteriously
disappeared from the Franklin Museum in Philadelphia.)
Greenspan's tenure was such a disaster for libertarian economics that
one might wonder if old Ben Franklin was on to something after all.
As Fed Chairman, Alan Greenspan morphed into the greatest enemy of
gold and a stable U.S. dollar in American history. He gave rapid continuing
expansion of the neo-Jacobin Welfare Warfare super state all the financial
rocket fuel it needed, and then some. Under his watch, unregulated
derivatives saw exponential explosion, and the anti-free market manipulations
by John Embry achieved a whole new quantum level of interventionist
deviancy. The alleged shenanigans of J.P. Morgan Chase and Barrick
against gold that were the subject of the Blanchard
suit are breathtaking examples of anti-free market manipulation
Abraham Lincoln was another monstrous disappointment in American history.
I have already discussed Dr. Thomas DiLorenzo's and Sam Dickson's
dark interpretations of his career.
It is clear from the record of Lincoln's debates that on an intellectual
level he understood American libertarian philosophy better than most
anyone else in his era, yet he did more in relative terms to move
America towards a more brutal, centralized, big government than any other
President, even compared to other big government interventionist Presidents
such as Woodrow Wilson, FDR, LBJ, and now George W. Bush. I invite
the reader to visit the King
Lincoln archive at lewrockwell.com for more disturbing details
about the real Lincoln.
Therefore, I believe strongly that while studying and understanding
libertarian ideas is a very important first step, this alone is not
a sufficient condition to adequately motivate people to effectively
restore liberty in America. Necessary, yes, sufficient, no.
I believe that in order to effectively preserve our liberties and
rights of basic survival and self-determination in this world, one
must also integrate libertarianism with the genetic side of the environmental
vs. genetic debate that I will describe next.
There are important character and ethno-racial issues that have to
be resolved in addition to purely philosophical questions. As an example,
in my section on mutualism
vs. parasitism, I discuss some social science research into the
"fractured" character of the "criminal personality."
Based upon my own study of the public and private behavior of both
Lincoln and Greenspan, I see ample evidence of fracturing and divided
loyalties in both cases.
While I love libertarian philosophy on an emotional level, I realize that taken only by itself, it can actually work as a "poison weed." Among
other things, it can encourage moral hazard and serve as an intellectual
cop out. For example, acting on the assumption that everyone is a
fully rational, self-sufficient, adult, it can encourage people to
play hardball and even break their implied agreements at will in their
business and social relations with people who are very vulnerable,
often for reasons beyond their control. With their strong environmental
viewpoint, many contemporary anarcho libertarians are willfully
blind towards racial and other biological differences. With their
heavily contractual and utilitarian viewpoint, they are also willfully
blind towards the need for people to have a sense of shared culture
and values and caring community leadership, particularly while white
Americans genocide themselves with low birth rates and get pushed
out of neighborhoods by illegal alien immigrants.
Many corporate executives who outsource jobs and manufacturing infrastructure
overseas at the drop of a hat when it boosts short term profits, as
well as greedy employers of illegal immigrant labor inside our borders
who need cheap labor, love contemporary anarcho-libertarian philosophy.
It tells them that pursuing social and economic policies that reduce
whites to a minority in America does not matter.
In actuality, these things matter greatly. Turning America into a
multi-racial, multi-cultural Third World slum is literally bankrupting
this country, escalating graft and corruption, destroying social efficiency,
increasing social tensions, and moving us ever closer towards Thomas
Chittum's vision of Civil War II where millions
of Americans may eventually die.
In other words, to some people libertarianism is license to be extremely
short-sighted and selfish, with the attitude that they can dump a
lot of hype and risk on other people, and if other people "bite,"
it is their own damn fault, because we live in caveat emptor world and it is their own fault if they are such "suckers"
are not tough cowboys.
A big problem with this viewpoint is that the advancement of civilization
depends on steadily increasing specialization and the division of
labor. No one has the time to look under hood and do complete due
diligence in every transaction if they are going to depend on the
untold thousands of devices and services that make up a complex economy
in the space age. The advancement of sophisticated, leading technology
businesses also requires a certain level of moral restraint, where
people have to show teamwork and restrain themselves from everyone
reaching in the cookie jar all at once as they turn intangible business
opportunities into tangible prototypes and ultimately cash flow.
Yes, early Americans believed in personal freedom, but many of these
descendants of Puritans also believed in assuming personal responsibility,
exercising personal moral restraint, and displaying the courage to
fight for not only ones rights as well as the rights of others (patriotism).
What American businessmen really need on an ideological level in order
to achieve long term, sustainable prosperity for both themselves and
America is not anarcho-libertarianism, but libertarian racial
nationalism. The latter approach, also known as 19th classical
liberalism, offers the best long term combination of relatively low
taxes, economic freedom, and social stability that they require.
Yes, I genuinely believe in the cause of liberty. However, to be effective,
I believe that one must not only make common cause with people of
good character, but must also combine a love of liberty with strongly
felt racial, ethnic, religious, and community bonds. This is necessary
to fend off the encroachments of alien threats that may range from
illegal alien immigrants on a pedestrian level to Zionist criminal
gangsterism on an elitist level. It is also necessary to achieve the
critical mass of staying power, resolve, teamwork, and self-sacrifice
required to carry through to sustainable success.
Part Four :
Back to: Part One Overview