The New Terrapin Gazette

Number 218

1 July, 2011

If women are at the apex of the government, then the state will be in danger — for they will not see to the requirements of the polity, but will act in accord with their momentary inclinations and opinions.


 

Inflation

Conclusion

The recent dip in the price of crude demonstrates that if easily-extracted oil were abundant, its international price would fall. The arrival in the market of new supplies forced the price down. Unfortunately that change was ephemeral and trivial; did you notice cheaper gasoline when the additional oil became available?

The only way to drive crude prices down to rational levels, and do it permanently, would be to produce virtually infinite quantities of the resource very cheaply from now on.

Economists are correct to assert that prices are influenced by supply and demand. Note that the inflation/deflation of the currency is not an integral part of the lowering of the price of oil. Note as well that the decline of the purchasing power of the dollar cannot possibly justify the rise in the price of crude. Yes, inflation and deflation do figure in the prices of goods and services, but their role in today’s oil prices is minor.

As already noted, a lot of obscenely wealthy Arabs have driven up the price of oil to record levels, and all oil, wherever produced, is now valued by that international price. If it costs ten dollars a barrel to produce oil in Texas, the refiner still pays over one hundred dollars for that oil — because one hundred dollars is what the oil can command. Something is worth exactly what you can get for it, and as long as every tiny oil producer in Texas can ship his oil to Japan, China or Argentina, he can tell a Texas refiner to pay over one hundred dollars a barrel.

Of course if the USA drastically cuts back its dependence on foreign oil, that will free up supplies for purchase by other nations (notably the growing nations that are fuel-hungry). An increase in the supply could therefore reduce oil prices.

There are two chances that this will happen: slim and fat. Any price reduction would be small. OPEC knows how to cope with increased supplies, and no nation can dump enough oil on the market to force prices down to decent levels and keep them there.

The people sitting on the great majority of the world’s current oil supplies just happen to be among the worst humans on earth. They will not tolerate oil at ten dollars a barrel, which is where it belongs.

In fact, they will consider oil at fifty dollars a barrel to be brazen theft from their vaults, an insult to their manhood, and a violation of all that is sacred. The world can expect boycotts, slowdowns, violence and the unexpected….

Times are tough, and the economic recovery of the USA will not be easy because an unholy confederation of the corrupt, the incompetent, the greedy and the ideologically goofy have been running things. Those people have to be stripped of their power to destroy prosperity. Of course Team Obama and almost all “progressives” will oppose reform bitterly. The hope, therefore, is that the Tea Party activists will inform themselves and demand change. Those folks have the common sense to tell the Old Guard to stand down.

“Old Guard”? Indeed it is. The people who have ruined the economy are a deluded cooperative composed of intellectually threadbare New Dealers, collectivist control freaks, trendy anticapitalist activists, cynical buck-chasers, and class warriors who hate the Neanderthaler of Flyover Country. This phalanx of losers, nutcases, insatiably greedy whores and smug authoritarians must be set aside. Sheer common sense gives the political center the power to do it; whether that segment of the body politic has the necessary information and determination is doubtful. It is likely to be shouted down by lying political hacks and the press.

But dream for a moment. If the Old Guard were set aside, what should the national policy be? First, to produce as much oil as possible. Second, to use all other energy technologies to the extent possible; that means trying to develop coal-fired plants that pollute less. Third, researching the technology of batteries in the hope that fully electric automobiles can be practical. Fourth, refurbishing the power grid to protect it from Carrington events and increase its capacity. Fifth, pushing hard to develop thermonuclear (fusion) power generation. Sixth, building more nuclear (fission) reactors.

All six elements of national policy should be implemented simultaneously.

Clearly, a replacement for the gasoline-powered automobile is necessary, and electric cars are not yet practical. Fuel cell technology is a dead end, as are solar and wind generation of electricity, so more practical technologies will have to be relied on while the nation carries on research to find the thermonuclear Holy Grail.

Notice that these suggestions for economic recovery do not even mention inflation. The nation faces challenges that are only distantly related to inflation. The temporally first priorities must include increased employment and the restoration of the national manufacturing capacity.

That said, inflation cannot be totally ignored. The folly of raising debt limits, borrowing more and more, funneling that money through political entities and repressing the free market will not be mocked, and harmful inflation will be one of the results of Peronist lunacy. Placing future generations in profound debt is twice dangerous: first, the savings of the middle class will be eroded by the excessive inflationary instability, and second, borrowing today will become increasingly expensive as lenders take presumed future inflation into account.

The dilemma is how to provide capital for the growth of business and industry without so eroding the value of the dollar that borrowing becomes impossible.

 

What bureau, what central bank and what regulators could possibly have the expertise to fine-tune the money supply so as to do no harm? For a collectivist, the answer is simple: one imposes control via a government agency, and creates prosperity by fiat.

That mindset has a plethora of implications. They are manifest today in Europe and the USA. The headlines proclaim the folly — though few are willing to see that politicians are much better at reducing prosperity than at increasing it. As a citizen of Thailand said to a New Terrapin staffer recently, “I don’t care if the politicians steal; I don’t care where they get the money to pay for my benefits; I don’t care about anything like that. I just want my benefits!” Thus do the Perons and Hitlers of the world assume power and abuse it until the inevitable catastrophe destroys their misbegotten works.

Given the current policy of borrowing astronomically in order to buy prosperity, it may be impossible for the USA to build an economy that can withstand the demands of its creditors. Unmanageable debt makes a muddy foundation.

The short- and medium-term futures are grim. Bernanke babbles to the groveling press, talking as if inflation were high prices and high prices were inflation; that’s a sign that reform is not likely. Until he and others like him can no longer spout ignorant and deceitful nonsense without being strongly challenged, the nation is in deep trouble. Rational energy and economic policies are simply not possible as long as Bernanke and his masters are in control.

Political change is, therefore, desperately necessary. It is the essential first step toward sanity. The ravages of excess, whether in inflation or deflation, are well known; what is not realized is that economics is a study, not a science, and that it cannot therefore be the instrument of wisdom.

Afterword

You have doubtless noticed that nothing has been said here about the constitutionality or propriety of the existence of the Federal Reserve, or about the wisdom of a return to the gold standard. Those issues are related to inflation, surely, but they do not appear likely to take center stage as the nation struggles to cope with the problems of unemployment, petroleum prices, and the control of the federal government by collectivist amateurs and machine politicians. For now and for the foreseeable future, whether to abolish the Federal Reserve will remain a concern for peripheral political factions, and the national debate will avoid it. That may be a serious mistake.

 

A Zombie Rises From The Grave

Feminism is once again the topic. Why ever? Because Maureen Dowd, columnist for the New York Times, has burdened the world with some revelations regarding the undead militancy and the Roman Catholic hierarchy. In response, a “wingnut” counters with an exorcism that may inform or amuse; it includes the following incantations:

…the sexual revolution has been a snare and a delusion for a) women, b) children, c) men, d) marriage, e) family stability, and f) the country’s political culture (cf. Clinton, William Jefferson [whom Dowd helped save in 1998]).

Maureen Dowd is unwilling to take the slightest measure of responsibility for helping sustain the toxic culture of an America in which the sexual abuse of the young is a general societal plague, not some Catholic-specific perversity.

…the Catholic Church in America today is quite likely the country’s safest environment for children and young people. The Church has cleaned its house while Maureen Dowd and other prophets and prophetesses of the Sexual Free-Fire Zone have blithely ignored the evidence of the broken and crippled lives caused by the sexual license they applaud as liberation.

There’s lots more hissing and spitting available, so if you feel like sorting out some feminists who hate The Vatican, have at it.

Related: The major media have imposed a de facto blackout, but this sad event is burning up the internet (for the full story, you’ll have to visit the sites referenced on the page linked here). You may not consider the controversy over the consequences of feminism interesting (or politically correct, or trendy); The New Terrapin links to this tragedy only because the media gatekeepers don’t always consider an informed public to be a good idea. Any elitist authoritarianism that sacrifices Liberty to ideological cant deserves to be confounded.

 

Links

From Samizdata: “Geert Wilders was not really the one on trial…no, it was the highest institutions of the Netherlands who were on trial with their credibility and very legitimacy at stake. Although I am delighted he was acquitted of all charges, frankly it is a disgrace that he was ever put on trial in the first place for simply stating his views about Islam and multiculturalism. And the fact the BBC calls him ‘far right’ tells you nothing useful about Geert Wilders’ views but speaks volumes about the BBC.” Amen! Wilders is not an extremist — he’s a moderate who understands the threat to Western Civilization.

Advisory: “Progressives” May Want To Avoid This As Particularly Distressing. — A collectivist attempt to rewrite history is revealed in all its Orwellian ugliness (yeah, that should be “Blairist” or perhaps “Blairian”).

Those pesky Jews continue whining and reminding everyone that the sky is falling. Oh, by the way: they are right.

Related: it’s been long enough for the dust to settle, so maybe this should not be greeted with shock.

Chinese electronic components were designed to sabotage the US weapons systems in which they were installed. How to respond to the bite of the dragon? First, put some people in prison. Then, in so far as practical, avoid purchasing consumer products made in China.

You can feel smug now, because you took this newsletter’s repeated advice (“Don’t go on the internet with Microsoft products”) and switched from Windows to a different operating system. So you are safe from the TDL-4 worm, which has taken control of over four million computers (without the knowledge of their owners, for the most part) and is rated by some as “indestructible”. The New Terrapin is proud of you.

The illicit relationship between rabid political operatives and unprincipled journalists is notorious. The best introduction to a recent twist in this crude, eternal scandal is probably a brief post on a weblog. Note in particular the remark that the real problem appears to be “…submission to a media meme.” Too right! There is reason for a modicum of optimism, for the weblogger notes that the news hoaxers are bad company: “You won’t get the nomination — and you surely won’t win the election — by cozying up to Big Media folks.” So mote it be.

Keeping the feds under control means understanding the scoundrels. First, realize that they love to play censor. Second, realize that they really love to play censor.

The suicidal insanity of the West: Muslim activists use the US jurisprudential system to try to hide their efforts to destroy the US jurisprudential system. Why should any subversive group be able to impose a confidentiality agreement on those who would report the activities of the cabal to the public?

Obama blundered. Says a weblogger: “If Sarah Palin had done this, it would be a major story. Luckily, it’s Obama so it’ll hardly get reported at all.” You know that’s true. Let’s see now, wasn’t there something about press bias and censorship and favoritism in the last issue of The New Terrapin? Hmmmm…

Very closely related, and demanding your attention: here’s a documented example of the sort of thing Sarah Palin and this newsletter loathe. It’s about firearms, organized crime, the malfeasance of law enforcement officials, murder, the vicious bias of the press, and the rottenness of the collectivist thugs in the White House and the Department of Justice. It will nauseate you. Don’t skip it.

Here’s one way of looking at the USA’s culture war. You won’t have to read more than a few paragraphs of the linked essay to get the idea. It describes a situation that seems to require a remedy, but is there one? Probably not, if you ask collectivists what to do, because those folks usually don’t make a distinction between problems and difficulties, and they think they can benefit society by acting coercively. Nevertheless if all education were the responsibility of the individual rather than the community…yes, that does sound counterproductive, but think it through. It’s a subtle notion that might be promising.

A weblogger who knows what he’s talking about takes a careful look at a recent Time magazine cover story on the US constitution. The major news magazine has produced a stunningly ignorant opinion piece that falls apart when examined.

From the Gratuitous Barbs folder: the success of the “Bourne” films — entertaining action fantasies — led a New Terrapin staffer to read the books. His comment: “Robert Ludlum’s stories inspired the screenwriters, but the plots are utterly distinct. Are the books better? No. Sheesh, Ludlum’s a best-selling author who does not know the difference between ‘flout’ and ‘flaunt’, and thinks the simple past tense of ‘to dive’ is ‘dove’. His style is neither evocative nor arresting. He brings to mind Gore Vidal’s remark that the wildly popular author Jacqueline Susann was a typist. Why, Ludlum’s example leads the most pedestrian scrivener to consider writing a book.”

If the GOP had pulled a stunt like this, the media would have howled (Hatch Act violations?) and the event would have been damned as proof that a cabal of Wall Street elitists is raping the economy. Follow the links for more information and commentary.

What “progressive” bigotry? That’s not elitist prejudice…it’s just wit! Ask any other NYT staffer!


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