Obama has a problem. It is one he shares with McCain, and 98% (I might be optimistically low here) of politicians in Washington: Their underlying political philosophies are intellectually and morally bankrupt.

They all share a common thread - they believe in the supremacy of the will of the majority over the will of individuals. In this manner, Obama, McCain, and the two parties they front represent only slightly different stripes of tyranny.

Obama would join us all in a suicide pact of sorts, putting vitality to the marxist maxim ‘from each according to his ability; to each according to his need’. He sees no problem with confiscating the belongings of one to give to another because they ‘need’ the stolen items, as need is defined by bureaucrats. In his world view, it is acceptable to use force to make participation in this suicide pact mandatory, because the needs of the collective outweigh the rights of individuals to avoid such a pact.

To be sure, Obama wouldn’t be implementing an income tax upon people who are not used to it - but he makes no bones about going after those whom he deems to not be paying their fair share. If we take him at his word, I would not be affected directly by his proposals - I do not make $250,000 a year - and might even benefit in a nominal manner. But I consider it no benefit to have men with guns stealing from others so that they might give it to me. He has no apparent qualms about the underlying premise - that the government has a right to the possessions of it’s citizens, and in fact, a fundamental right to it that the individual doesn’t have. The government may demand any portion of my income, as they alone control the marginal tax rates, and raise them as they see fit. Were that portion demanded to be 100%, what would it change? As an individual, am I protected from the long arm of the government taking all that I have? On what grounds can I protest? If the government deems that it ‘needs’ 100% of the fruits of my labor, I am without recourse. If they may take a tenth or a third or half morally, why does taking all of the results of my personal productivity become immoral?

Obama and his peers have a serious problem. Their bankrupt, immoral beliefs are demonstrably immoral and bankrupt, and a revolution is afoot in this country to say no more. His philosophy of government has as it’s underlying premise that the individual and his productive capacity are assets of the state, a particularly problematic phenomenon in a land that pays lip service to the concept of liberty.
May it come quickly, and may we sweep away the horde of state worshipers who feed at the teet on the fruits of our labors, coerced from us under the threat of violence to our persons. People are waking up - more and more each and every day. Are you awake?

In the Financial Times this morning, Timothy Geithner, President of the New York Fed, calls for a global system of regulation for banks.

Geithner says:

“At present the Fed has broad responsibility for financial stability not matched by direct authority and the consequences of the actions we have taken in this crisis make it more important that we close that gap.”

This is a power grab of unprecedented scope, and would represent the first step in the codifying a global system of financial command and control.

If you’re in the ‘Government is good and benevolent’ camp, then you’re probably thinking - ‘about time they had the power to overcome the issues endemic to a system with disparate laws, regulations and capital requirements’.

I wouldn’t share that outlook.

Globalizing the banking system would give bankers and regulators more control over the global economy. That isn’t really disputed by anyone. The salient question is - why would we want to give bankers and bureaucrats more control over the world’s economy? Is it the excellent job they’ve done administrating things collectively over the national banking systems they oversee?

Allowing such an Orwellian construct to arise would effectively wrest monetary policy from the hands of individual nation states, and hand control over to internationalists and elitists with little loyalty to any nation state, and with no democratic checks. This cannot happen without a global system of government following in short order. You cannot have a supranational banking system without a corresponding political power to regulate the banks and a relatively homogenous framework of governments.

Centralization of power in fewer and fewer hands is not a positive development, but it won’t be too difficult to convince the ignorant populace that such a system is the way to recover from and avoid a future calamity such as the one we are on the cusp of. Most people will accept any broad evil if they are convinced that they themselves will benefit.

Anyone who doubts the dire nature of the outlook for the global economy should think about why Geithner would be out front-running this idea. Why now? Is he speaking off-the-cuff, or is this a trial balloon, vetted and approved at the highest levels of our financial system? I think you’d be safe to assume that Geithner doesn’t write an op-ed for the FT without vetting his commentary first. And this isn’t an action undertaken flippantly. At the very least, the seeds for an absolute catastrophe must be present. This isn’t a tweak - this is laying the groundwork for what lies ahead of us.

If you aren’t worried, I’d argue that you should be.

Geltner continues:

Since last summer, we have lived through a severe and complex financial crisis. Why was the financial system so fragile? What can be done to make the system more resilient in the future?

The world experienced a financial boom. The boom fed demand for risk. Products were created to meet that demand, including risky, complicated mortgages. Many assets were financed with significant leverage and liquidity risk and many of the world’s largest financial institutions got themselves too exposed to the risk of a global downturn. The amount of long-term illiquid assets financed with short-term liabilities made the system vulnerable to a classic type of run. As concern about risk increased, investors pulled back, triggering a self-reinforcing cycle of forced liquidation of assets, higher margin requirements, increased volatility.

What Geithner forgets, or rather hopes that we’ll forget, is that this ‘financial boom’ that ‘created… demand’ was a direct result of bad monetary policy. Effective interest rates were less than zero for about three years, and that creates a situation where commercial banks have a great incentive to push debt without a rigid regard for the real risks they undertook, and it encourages malinvestment by businesses and banks who have access to the free capital in the beginning stages of the inflating money supply.

Instituting a centralized global system only exacerbates the problem. We’d have all our eggs in the same basket, and the next time we played this same game, there would be no area of the globe immune from the problems that the US central banker’s loose monetary policy and the suckers who bought all of the dubious financial instruments “created to meet that demand” have brought us too.

The idea that the problems we face currently in the world’s economic system are a result of too little centralization would make me laugh if the consequences of Geithner’s proposal weren’t so dire. We would be entrusting control over our money and banking, and by direct extension, our freedoms - to a world full of despots, communists and robber barons.

The Fed has no power but to inflate, and inflation is the great destroyer of the wealth of the working people. The only restraining influence is that if other nations don’t coordinate these inflationary policies, the consequences are dire and obvious. Allowing a centralized authority to have the power to force coordination is a recipe for disaster for everyone except the interests who have long pressed for a fascist system that is global in it’s scope. Once they get their way, there is no longer a restraining influence on the power of the inflators to ply their trade.

The Federal Reserve in specific, and central banks in general have failed miserably throughout all of history, and every time they fail, we reward them with more power. One of these days, we’ll learn that the failure of centralized authority is not a reason to further centralize authority. Or at least I hope we will.



More on this topic later.