Ground Control to Major Tom

It was bound to happen. I hoped however; I hoped that things may be changing. I was on cloud 9 a few days ago; amazing what less than 48 hours and a dose of reality can do for the mind. The House veto on the bailout may all be for not. The Senate early this morning voted FOR, by a margin of 74-25, the somewhat altered buy ultimatley the same bullshit bailout bill. Might as well call this bill "Stick it to the American taxpayer." The same flawed logic of how artificially low interest rates would "stimulate" the market is being used for this bailout. The idea that letting the credit markets correct naturally is "to risky" is the logic in DC. I thought that the government interference into the market by creating Fannie and Freddie and the absolute failure of them would teach our government something; apparently I was banking on a majority of politicians learning from past mistakes and having some foresight; I'll pause there to give you time to laugh histarically at that.

Here is the unattractive truth people; were are in a recession now and it will get worse, much worse. This bailout will make it 10 times worse. We were in for a bad year or two, the way we are going its going to turn into a bad decade. The Austrian theory of the business cycle predicted all of this. If people were to read Ludwig von Mises and Murray Rothbard they would think they were reading a modern day Nostradamus. Except Rothbard and Mises actually predicted something and made accurate assessments. So I guess nothing like Nastradamus actually; but you get my point. The sad part is that both presidential candidates are in support of this bill. Sadder still is the blame that free market capitalism is getting because of this. The problem is that Republicans gave lip service to free market speech but when they were elected did not make any real free market reforms. They simply made more loop holes and advantages for corporations and gave tax incentives to some businesses while neglecting others. They operated state capitalism, also called corporatism. Where private business and government get in bed together and make deals for each of their benefits. When government and business crawl into bed together, the offspring that it would unleash on the world would make even the most extreme conservative scream for it to be aborted. Under a truly free market system these businesses would have to operate solely on competition and would not be given government aid or advantage.

The problem was not lack of regulation; far from it. The real crooks are the businesses and government that made these back door deals and artifically manipulated the market. Under the truly free market system where competition sets the standard all these risky loans and maleinvestment would not have been made on this scale. And if maleinvestments were made the people who gave the loans and those who did not hold up to their ends of the deal would be held responsible; not every single honest hard working American. That is the beauty of the market; responsibility. As the Austrian economist and champion of liberty Frederick Hayek once said

"Liberty not only means that the individual has both the opportunity and the burden of choice; it also means that he must bear the consequences of his actions. Liberty and responsibility are inseparable."

It is safe to say I have come off of my high from a few days ago. My plane is taxiing into the airport and my tray table in front of me is in its upright and locked position. Too bad the landing gear doesn't working and the government is the pilot with the Federal Reserve chairman Ben Bernanke as co-pilot. What's even worse is that all of you are on this plane with me. The only question left is how we land. Do we make an immediate crash landing on the tarmack? Do we land it as soft as we can in an open field or a body of water ? Well if what we are seeing unfold infront of us is any clue my money is on the pilots driving straight into the impending mountain right in front of us. Hope you have a parachute.

In Liberty,
Mr. Jefferson

"It is always from a minority acting in ways different from what the majority would prescribe that the majority in the end learns to do better."
-Frederick Hayek