Marcus is chief editor of AmericanBankster.com and is also a full-time student in Southern California. Marcus is a veteran of the 2003 Iraq War, liberty advocate, and history buff. Marcus also worked in the banking industry for four years.
Published Articles:
Ben Bernake Reveals His Life Long Idol: Robert Mugabe
Based on deep analysis of the actions of the Federal Reserve over the past two years, AmericanBankster.com has learned that Ben Bernanke is indeed using the playbook of another master economist: President of Zimbabwe, Robert Mugabe.
Robert MUGABE, the nation's first prime minister, has been the country's only ruler (as president since 1987)
and has dominated the country's political system since independence. His chaotic land redistribution campaign,
which began in 2000, caused an exodus of white farmers, crippled the economy, and ushered in widespread shortages
of basic commodities. Ignoring international condemnation, MUGABE rigged the 2002 presidential election to ensure
his reelection....In April 2005, Harare [the capital city of Zimbabwe(mine)] embarked on Operation Restore Order, ostensibly an urban rationalization program, which resulted in the destruction of the homes or businesses of 700,000 mostly poor supporters of the opposition.
President MUGABE in June 2007 instituted price controls on all basic commodities causing panic buying and leaving store shelves empty for months.
The government of Zimbabwe faces a wide variety of difficult economic
problems as it struggles with an unsustainable fiscal deficit, an overvalued
official exchange rate, hyperinflation, and bare store shelves. Its 1998-2002
involvement in the war in the Democratic Republic of the Congo drained hundreds of millions of dollars from the economy.
The government's land reform program, characterized by chaos and violence,
has badly damaged the commercial farming sector, the traditional source of exports
and foreign exchange and the provider of 400,000 jobs, turning Zimbabwe into a net
importer of food products. The EU and the US provide food aid on humanitarian grounds.
Badly needed support from the IMF has been suspended because of the government's arrears
on past loans and the government's unwillingness to enact reforms that would stabilize the economy.
The Reserve Bank of Zimbabwe routinely prints money to fund the budget deficit,
causing the official annual inflation rate to rise from 32% in 1998, to 133% in
2004, 585% in 2005, past 1,000% in 2006, and 26,000% in November 2007, and to 11.2 million percent in 2008.
Meanwhile, the official exchange rate fell from approximately 1 (revalued) Zimbabwean dollar per US dollar
in 2003 to 30,000 per US dollar in September 2007.
Cheng Siwei, former vice-chairman of the Standing Committee and
now head of China's green energy drive, said Beijing was dismayed by the Fed's
recourse to "credit easing".
"We hope there
will be a change in monetary policy as soon as they have positive growth
again," he said at the Ambrosetti Workshop, a
policy gathering on Lake Como.
"If they keep
printing money to buy bonds it will lead to inflation, and after a year or two
the dollar will fall hard. Most of our foreign reserves are in US bonds and
this is very difficult to change, so we will diversify incremental reserves
into euros, yen, and other currencies," he said.
China's reserves are
more than – $2 trillion, the world's largest.
"Gold is
definitely an alternative, but when we buy, the price goes up. We have to do it
carefully so as not to stimulate the markets," he added.
Why is this important? It means that China won’t be
buying any short-term or long-term US debt. If President Obama
and the Congress don’t show any signs of easing up on SPENDING, then the Federal Reserve will
have to increase the amount of dollars it prints. If it keeps printing dollars
at this rate, then very soon we will see the effects of inflation begin,
followed by hyper-inflation.
Prices will spiral up and out of control and most of the middle class will
become poor and the already poor will suffer the most. The cost of milk and
bread will be prohibitively high. Small farms will go out of business, driving
prices even higher as competition is diminished.
We have dug ourselves into a huge hole, and the more we
spend the deeper we go. We need to carry out the following actions in order to
prevent hyper-inflation and the collapse of the dollar.
·Stop the spending; hold all spending and find
ways to eliminate at least 20% of the budget. Easiest places to cut are
overseas spending. End the Empire. End the Drug War.
·Repeal the 16th Amendment and the
Income Tax. This is the only real way to stimulate economic growth.
·Pass a Balanced Budget Amendment to the
Constitution. Government borrowing from future generations should be illegal.
·Allow people to choose their own unit of
exchange: legalize gold and silver and other precious metals to be used as
money.
Do you agree with these suggestions? Contact me via
twitter at: @ronpaulfan1982
The Healthcare Problem Explained and Solved
The Healthcare Problem Explained and Solved
Why is
healthcare suddenly an issue? The primary reason that the public is upset is
their insurance rates keep rising year after year for the same service. The
reason Congress is sticking their nose in the healthcare business is because
the US faces the worst recession since the ‘30’s and the US Government is out
of money and out of credit.
The dollar
is no longer king, foreign investors (China and Japan) are not buying US
Treasury Bonds and the Federal Reserve has doubled the money supply and
counting.
Healthcare
costs rise faster than other industries for three primary reasons:
First, the
medical industry is a highly regulated industry with too many laws restricting
competition. The segments of the medical industry that are less regulated and
experience more competition are experiencing stable and even falling prices;
elective procedures such as plastic surgery and laser eye surgery are getting
cheaper. One reason that the industry might be so tightly regulated is at the
behest of the top insurance companies; if the state or federal government can
produce a law that helps Blue Cross or BlueShield wipe out the competition by
requiring citizens to buy health insurance from only approved insurers within
their own state, then these big business health insurance companies may throw
their support behind tighter regulations and more restrictions for their
competition. It makes it so that you’d have to have billions of dollars to
start an insurance company.
Second, the
tax code has brought about the employer-provided insurance system that has
resulted in less competition and higher prices. Businesses are allowed to
deduct the healthcare costs of their employees from their taxes, but
individuals cannot deduct their own healthcare costs from their taxes. The
employer-provided insurance system creates yet another degree of separation
between the patient, [Insurance Company, Employer] and doctor. This adds another
administrative expense, gives less choice to employees and consumers and more
control to big business owners, union bosses, bureaucrats and politicians.
Finally,
Medicare is one of the government’s largest expenses and where there is
government largess there tends to be waste and temptation for corruption and fraud.
Without Medicare pumping billions of dollars into the medical industry with
money hot off the Federal Reserve presses, healthcare would be cheaper for
everyone.
The
solution then is to loosen and/or eliminate many of the regulations on the
healthcare industry (especially those that create monopolies for the
politically connected), repeal the individual income tax and allow people to
keep more of their money to pay for their own doctors visits and to insure
against major medical emergencies. If the political will to repeal the income
tax does not exist, then simply allow individuals to deduct all healthcare
costs from their taxes, as businesses do.
Medicare
cannot be simply repealed like the income tax. Many people have become
dependent on government. The best we could do is to allow people to opt out of
Medicare until it becomes irrelevant. With fewer regulations and no income tax
it would only be a matter of time until the free market drives people to choose
private insurance over Medicare. Even with the individual income tax repealed,
the government will still collect the same amount in taxes as we collected in
the year 2000. We’ll still have money (provided we wise up on the foreign
policy front) to take care of the people that have become dependent on
government and allow everyone else to take full advantage of the free market’s
low prices and high quality goods and services.
Obama’s Broken Window
A young hoodlum, say, heaves a brick
through the window of a baker’s shop. The shopkeeper runs out furious, but the
boy is gone. A crowd gathers, and begins to stare with quiet satisfaction at
the gaping hole in the window and the shattered glass over the bread and pies.
After a while the crowd feels the need for philosophic reflection. And several
of its members are almost certain to remind each other or the bakers that,
after all, the misfortune has its bright side. It will make business of some
glazier. As they begin to think of this they elaborate upon it. How much does a
new plate glass window cost? Two hundred and fifty dollars?
That will be quite a sum. After all, if windows were never broken, what would
happen to the glass business? Then, of course, the thing is endless. The
glazier will have $250 more to spend with other merchants, and these in turn
will have $250 more to spend with other merchants, and so ad infinitum. The
smashed window will go on providing money and employment in ever-widening
circles. The logical conclusion from all this would be, if the crowd drew it,
that the young hoodlum who threw the brick, far from being a public menace, was
a public benefactor.
In a similar fashion, the economy is Obama’s window, except
it isn’t broken yet, and the crowd, made up of Obama’s
economic advisors, has already gathered insisting that they must break the
window in order to save the glazier’s business and all the merchants that
depend on the glazier.
Now let us take
another look. The crowd was at least right in its first conclusion. This little
act of vandalism will in the first instance mean more business for some
glazier. The glazier will be no more unhappy to learn
of the incident than an undertaker to learn of a death. But the shopkeeper will
be out $250 that he was planning to spend for a new suit. Because he has had to
replace the window, he will have to go without the suit (or some equivalent
need or luxury). Instead of having a window and $250 he now has merely a
window. Or, as he was planning to buy the suit that very afternoon, instead of
having both a window and a suit he must be content with the window and no suit.
If we think of him as part of the community, the community has lost a new suit
that might otherwise have coming into being, and is just that much poorer.
The glazier’s gain of
business, in short, is merely the tailor’s loss of business. No new
“employment” has been added. The people in the crowd were thinking only of two
parties to the transaction, the baker and the glazier. They had forgotten the
potential third party involved, the tailor. They
forgot him precisely because he will not now enter the scene. They will see the
new window in the next day or two. The will never see the extra suit, precisely
because it will never be made. They see only what is immediately visible to the
eye.
In the same way, the Obama administration is only seeing the
need to break the window in order to save the glazier. In reality the glazier
is any industry that the government decides to bailout, including the banks and
auto industry. If they decide to bailout the glazier, they run the risk of
putting the tailor out of business. Then the community is not only out a new
suit, they are out a tailor and all of the contributions the tailor would have
made to the local economy.
In a free market economy, a failing business is just as
important as a successful business. Not only does it help define the demand of
consumers for a particular set of goods and services, it also creates
opportunities for entrepreneurs to buy up any remaining assets of the failed
business and perhaps increase the value of those assets through proper
management. This is why it does not make any economic sense whatsoever for the
government to save a failing business. When a business fails, the market
(through consumers and investors) has decided that the business is not
efficient enough or in high enough demand to exist, therefore, it should and
must fail! To prop it up with taxpayer dollars is to take efficient money out
of the economy and place it in the inefficient hands of bureaucrats where half
of the money will be eaten up by the bureaucratic machine, and the other half
will be wasted on a business that the market has already decided must
fail. Furthermore, bailouts for politically connected industries also
create a moral hazard, whereby these businesses take risks in contravention of
market conditions, in anticipation that any miscalculation will be met with
government largesse.
In a free market economy it is natural that jobs will be
lost and gained and that homes will be foreclosed on and resold. It is an
arrogant mistake of the Keynesian economist to believe that he can centrally
plan the economy, through tax policy and government spending, to create
something that is somehow better than the free market at delivering goods and
services to consumers. In fact, it is this very central planning,
principally through the manipulation of interest rates and unsustainable
government spending that has caused this economic downturn.
The cheapest, fastest and most efficient way of delivering
the highest quality of goods and services to the most people is via the free
market and the free market only! Government intervention in the free market
through taxes, spending, and regulation only serves to hurt the market’s
ability to provide these goods and services. To prove this point one only need
study the history of two industries in the United States that are heavily
regulated: healthcare and education; and compare it to an unregulated industry:
electronics; such as computers, televisions, iPods, etc.
Every year electronic devices become cheaper and better,
but by contrast each year education and healthcare become more expensive and
the quality of service declines. Why?
One only need to take a stroll through Costco, Wal-Mart,
or any big box store to see how televisions keep getting bigger, better and
cheaper every year. Why is this? There are several hundred if not thousands of
television manufacturers world-wide. In an industry with so much competition,
it is impossible to survive without constantly making technological advances
that will make your product better than the competition. The industry is
practically regulation free when compared to the heavily regulated industries
in the United States.
The first thing we must realize when we discuss education
is that education is a service that can be delivered by the private sector just
as easily as lawyers, landscapers, gymnasiums, movie theaters and
restaurants. We must also take a look at education with a focus on logic rather
than emotion. Although the education of our own children can cause some natural
emotional responses, we must decide that a logical, rather than emotional
approach to the issue must be taken. If we take a look at education, we see
that the national drop-out rate continues to rise while the graduation rate
falls. The Federal Government is spending more money than ever before in
history on education, yet the value of an education in the United States
continues to decline. The government owns the monopoly called public education.
It is common knowledge these days that private schools will on average provide
a better education to students than a public school, and they can usually do
this at a much reduced cost per student. According to a 1996 Cato
Institute study, the average tuition for all private schools, elementary and
secondary, is $3,116; less than half of the average cost per pupil in the
public school, $6,857. If you need more proof, just look at the top
private colleges in the nation and compare them to the top public schools in
the nation. Harvard, Yale, Stanford blow the public competition out of the
water. While it is often the case that these upper echelon universities
have huge endowments and seemingly unlimited resources to provide the best
possible education, their financial strength is merely another benefit of the
private sector -- it creates innumerable choices for the consumer that wouldn't
exist in an exclusively public system. But not all parents can afford to
send their kids to private school because of the high price of tuition (the
high cost of public education is socialized and hidden, but is still very much
a reality). However, if the public education system was abolished, and all
schools were private schools, the tuition cost of private schools would reduce
dramatically and the quality of the education would also increase. A
completely privatized education system would allow for much more charity
through the reduction in necessary taxes. It has also been proven that
when taxes are reduced, charitable donations increase. Thus it would
be likely those parents without the means to pay the tuition for a private
school and do not have the ability to home school their children, would be able
to receive a charitable scholarship. High schools, like colleges, would soon
become interested in recruiting and offering scholarships to talented students
that can improve the reputation of their school, either through academics or
athletics. Without the government monopoly of free or nearly free education I
believe we would have a higher graduation rate and our high school and college
students would be some of the brightest in the world; much like we see at
private schools today (even with the unfair monopolistic competition of free
public schools).
As for healthcare, the government creates monopolies for
insurance companies by a law on the books that does not allow consumers to buy
health insurance across state lines. The government is forcing you to buy from
a pre-selected group of insurance companies that it approves of, limiting the
competition for these companies. With little or no competition, insurance
companies can now charge whatever price they want and decline all the coverage
they want and the consumer is powerless to do anything.
While the damage done by regulatory and licensing interference
in the market is almost limitless, another impediment to affordable and quality
healthcare is government socialized medicine, namely Medicare and Medicaid.
Sure, only the poor and elderly are covered by these government programs, but
those are the very people most likely to seek medical services -- particularly
when it is provided to them at no cost. Everyone else not only pays for
their own medical costs, but is violently coerced into subsidizing the care of
others. Just as federally subsidized education drives up costs for
everyone seeking an education, government subsidized medicine makes everything
more expensive for the productive. The bureaucrats running these programs
assign a code to every conceivable medical service and procedure. Each
code has its own monetary value. When a doctor treats a patient covered
by Medicare or Medicaid, the doctor does not decide how much to charge the
patient, the bureaucrats decide how much to reimburse the doctor. These
prices are arbitrary, mere guesses, because only the market, driven by supply
and demand, can determine prices. What results is that doctors are
undercompensated when they provide care to Medicare and Medicaid patients, and
to remain profitable, doctors will pass on these costs to patients paying their
own way. The solution is not to throw more money at the problem so that
Medicare and Medicaid services are fully paid for and doctors are fairly
compensated. Again, only the market can determine price, and any
non-market payment will necessarily be either too much or too little. The
solution is to jettison our over burdensome regulatory structure to allow
free competition, free entry into the industry and true prices in the
marketplace.
Now that we have examined how destructive the government
can be to our economy, we now only need to take the necessary steps towards
more privatization and less regulation in order to bail ourselves out of this
recession. Allowing bad businesses to fail and housing prices to drop is the
only thing that will save us for a long drawn-out depression that is certainly
on our horizon if we continue down this destructive path of nationalization and
pseudo-socialism.
Written by staff writers Marcus Schuff and Courtney Butler
Not many people realize that the oil companies have bought themselves the cheapest insurance possible when they lobbied the Federal Government to provide them with a liability cap on the liabilities for oil companies after a spill. As Timothy Carney of the Washington Examiner points out, there is a government-created slush fund to keep big oil from paying to clean up it's own oil spills.
WASHINGTON — The president of the World Bank said on Monday that America’s days as an unchallenged economic superpower might be numbered and that the dollar was likely to lose its favored position as the euro and the Chinese renminbi assume bigger roles.
The Reserve Bank of Zimbabwe routinely prints money to fund the budget deficit, causing the official annual inflation rate to rise from 32% in 1998, to 133% in 2004, 585% in 2005, past 1,000% in 2006, and 26,000% in November 2007, and to 11.2 million percent in 2008. Meanwhile, the official exchange rate fell from approximately 1 (revalued) Zimbabwean dollar per US dollar in 2003 to 30,000 per US dollar in September 2007.
Why is this important? It means that China won’t be buying any short-term or long-term US debt. If President Obama and the Congress don’t show any signs of easing up on SPENDING, then the Federal Reserve will have to increase the amount of dollars it prints. If it keeps printing dollars at this rate, then very soon we will see the effects of inflation begin, followed by hyper-inflation. Prices will spiral up and out of control and most of the middle class will become poor and the already poor will suffer the most. The cost of milk and bread will be prohibitively high. Small farms will go out of business, driving prices even higher as competition is diminished.
...the tax code has brought about the employer-provided insurance system that has resulted in less competition and higher prices. The employer-provided insurance system creates yet another degree of separation between the patient, [Insurance Company, Employer] and doctor. This adds another administrative expense, gives less choice to employees and consumers and more control to big business owners, union bosses, bureaucrats and politicians."
"Over time the terms conservative and liberal have changed, and while this idea of labels changing is nothing new,
it is important to acknowledge such change and to recognize the meaning to assess where we stand as individuals."
"...the crowd, made up of Obama's economic advisors, has already gathered
insisting that they must break the window in order to save the glazier's
business and all the merchants that depend on the glazier."
"When a business fails, the market (through consumers and investors)
has decided that the business is not efficient enough or in high enough demand to exist,
therefore, it should and must fail! To prop it up with taxpayer dollars is to take efficient
money out of the economy and place it in the inefficient hands of bureaucrats where half of
the money will be eaten up by the bureaucratic machine, and the other half will be wasted on
a business that the market has already decided must fail."
"US fast-food giant McDonald's said Monday its 2008 net profit
soared 80 percent from a year, lifted by growing demand from consumers
seeking low-cost meals in a deepening global recession."
"Wall Street is losing faith in Washington's efforts to fix
the financial crisis."
"The size of the problem is growing faster than the banks' ability to
handle it....We're halfway through the bailout money, and the banks
are in worse shape than they were six months ago."
Not only are taxpayers experiencing ever-increasing direct
taxes such as gasoline tax, property tax, sales tax, cigarette tax,
alcohol tax, etc., but your standard of living is being taxed through
the devaluation of your dollars.
Every time the government creates a new program, your standard of living
will get worse.
