Tuesday, April 1, 2008
The People Demand JUSTICE!
A new set of showtrials are in progress. The people who have done everything in their power to raise gasoline prices are bringing in the people who are doing everything they can to lower gasoline prices and demanding to know why prices are so high. Politicians who voted to keep ANWR and the outer continental shelf off limits to drilling, who have prevented the construction of nuclear power plants and oil refineries and who are wasting hundreds of billions of dollars of taxpayer's money on bogus 'renewable energy sources' feel like they have to show the morons who voted them into office that they are 'tough' on the energy company executives who they imply are engaged in a nefarious scheme to squeeze money from the helpless public. Almost every disruption and price rise that has happened recently can be traced to government intervention in the market, usually, but not always, at the behest of the eco-maniacs whose ultimate goal is the end of private automobile ownership for the common herd. Even though the Republicans are (or were) slightly better on this issue the fact is that the political culture in Washington is united in its belief that this type of intervention in the marketplace solves problems instead of creating them. In the coverage of the banking crisis one reporter remarked that there hadnt been this level of government regulation proposed in the finance industry since the Great Depression. There was a charming lack of irony in that statement which showed no understanding that excessive government regulation might have turned the Crash Of 1929 from a sharp recession and market correction into a decade-long nightmare. Now we're seeing the same Hoover-FDR style of bullying/bungling and an entire elite culture which has been so miseducated in their Ivy League socialist boot camps that the obvious basic economic facts of life are a mystery to them. This has even slopped over into the private sector. The larger a corporation becomes the more out of touch with economic reality and bloated with layers of bureaucracy it becomes. Now we're seeing more and more companies coming to the government for a bailout so that the shareholders, who put up with endless mismanagement and government overregulation wont have to stop and think about where all this is going. Bear Stearns is a prime example. The government goes on a rampage yelling about how restrictive lending practices (requiring good credit and the mortgagee putting a certain percentage of the price down before a mortgage was given) were locking minorities and the working poor out of the housing market. Down go the fences and all of a sudden the housing market is filled with deadbeats and speculators, prices expand in a giant bubble which everybody mistakes for a real growth in equity and then POP! the bubble bursts. The government, which was instrumental in causing the problem in the first place, rushes in with hundreds of billions to 'prevent a disaster'.
Of course, this is not free money this is money that comes with strings attached; the banks will have to submit to the aforementioned 'depression-level regulation'. Now the same level of intervention is going to be applied to the energy industry. How many hundred-million windmills or solar panels will it take to produce the same amount of energy as one nuclear power plant and how much energy does it take to maintain and capture the energy those widespread 'alternative energy sources' will generate? We already know that Ethanol takes more energy to produce and distribute than you get from burning it, and that the federal subsidies have raised food prices dramatically (why arent the food executives being dragged in front of the Inquisitors?). Isnt the trend towards 'depression-level regulation' in all industries?
With the Republicans morphing into the "Me Too, Just Not As Much" milquetoasts, very similar to their clueless European 'center-right' counterparts, the people who disagree with the direction things are going find themselves on the outside with nowhere to turn. If enough industries are subjected to 'Depression-Level Regulation' we are going to have a depression, probably similar to the negative-growth high unemployment European welfare states. That would be bleak enough if we were financially solvent but we are not. There is a coming moment of truth when the declining economy wont pay for all the annuities, subsidies and transfer payments. Lowering the productivity of the economy and destroying individual incentive, creating a culture where a fat 401k and an early retirement from your meaningless middle-management job becomes the ultimate achievement and losing all sight of the principles and the vision that made us the leader of the world, the place where almost all new ideas and technical innovations originated, ensures that the perceived value of all pensions and transfer payments such as Social Security are vastly overinflated. When people realize that the paper promises they've staked their future hopes on are nearly worthless that realization is going to cause political panic. I fear the next few years.