Double-dip? Or never-ending bust?

“"Whether one likes it or not, it is a fact that the main issues of present-day politics are purely economic and cannot be understood without a grasp of economic theory. Only a man conversant with the main problems of economics is in a position to form an independent opinion on the problems involved. All the others are merely repeating what they have picked up by the way. They are an easy prey to demagogic swindlers and idiotic quacks.   Their gullibility is the most serious menace to the preservation of democracy and to Western civilization.”
            - Ludwig Von Mises, Bureaucracy

‘Midst expectations of a “double-dip” recession and in the light of the above,  you might be wondering “Did the (U.S) Recession Ever Really Go Away?” 

And you might appreciate  “ A Primer on the Never-Ending Bust.”

“We’re awful,” sayeth the teacher

Ann McElhinney, former teacher and now famous for her films "Not Evil Just Wrong" and "Mine Your Own Business," gives a heartfelt speech about how children are being indoctrinated by teachers.

Don’t think her stories only applies to the States.

What she’s talking about are the modern-day Comprachicos.

But the modern heirs of the comprachicos are smarter and subtler than their predecessors: they do not hide, they practice their trade in the open; they do not buy children, the children are delivered to them; they do not use sulphur or iron, they achieve their goal without ever laying a finger on their little victims. The ancient comprachicos hid the operation, but displayed its results; their heirs have reversed the process: the operation is open, the results are invisible…

[HT Robert at the Small Dead Animals blog]

June 6, 1944

June 6, 1944, is one of the most momentous days out of many in twentieth-century history.

It was the day sixty-seven years ago that the free west summoned every resource available, and gambled everything on the outcome of this one day, and one vast attack—an assault across the English Channel on five beaches in western France. It’s object: to free Western Europe from the Nazi jackboot.

This was D-Day.

The tale of Operation Overlord, a heroic assault on the Atlantic Wall launched by the greatest invasion armada the world has ever seen, has been told many times but never so well or as effectively as the sweeping story told by Cornelius Ryan in his non-fiction account The Longest Day—which became a surprisingly effective 1962 movie starring everyone at the time who held an Actors Equity card.

Don’t accept cheap imitations.  Unlike the Spielberg splatterfest which purports to portray the same momentous event, this film (and more especially the book on which it was based) shows both the context of this landmark event and its human interest stories.

Cycling around those Normandy beaches a few years ago with my copy of Ryan’s book as one of my guides, I soon discovered that when they saw the book the locals were still keen to stop me and talk about what happened that day so many decades ago.  And sometimes (since they were talking very fast, very idiosyncratic French) I could even work out what they were talking about.  Or some of it.

And I remember sitting in a pillbox on Omaha beach, imagining how it must have felt that morning to have looked out to sea and seen the whole horizon armed to the teeth and heading straight for you…

… fast forward to 3:15. And keep your buttocks clenched.

QUOTE OF THE DAY: On minimum wages

“The proposal is to make low wage earners less employable. To
steal their right to work for whatever wage they want to. To ensure
that they don't get the work experience they need in order to earn
more later in life. And most crucially of all, the increase in the
minimum wage would cement job security for those already
earning above the minimum wage. It does this by reducing
competition. That's why unions came up with the idea.”
           - Nickolai Hubble, from The Daily Reckoning Australia

Rand on religion

See, even big government liberals can admit “Ayn Rand Wasn’t Always Wrong.” Says P.Z. Myers at Pharyngula,

    This is a video of Ayn Rand on a talk show in [1979, three years before the died]. Don't run away yet! The interesting part… [is] the audience and also the host: they seem horrified that someone has so boldly stated that they don't believe in god. And that liberal host, Phil Donahue, "tsk, tsk, tsk"s her, and you can tell he's just unable to comprehend someone denying the deity.
    We have come a long way. I don't think a modern audience would be much less annoyed, but at least they wouldn't be as surprised.

Friday Morning Ramble: Lot’s to get (un)excited about

Local politics has become almost unwatchable. So I’ve stopped watching it. For the moment, anyway.  How about you?
In the meantime, here’s a few things that caught my eye this week.

• As  Eric Crampton points out, debaters on both sides of the minimum wage argument have been making stuff up.
  Over and underestimating effects of minimum wages
  – Eric Crampton, O F F S E T T I N G   B E H A V I O U R
• The story of New Orleans’s resurgence after Hurricane Katrina might offer some hope for struggling Cantabrians if they can get the political classes off their backs. Because Katrina’s recovery did not come from the top down. The disaster “undermined the corrupt, inept political regimes that had burdened the area for decades… After Katrina everyone was forced to become an entrepreneur. The dominant concept for the rebuilding has become one of resiliency and self-employment.”
  Let’s hope the same thing will pull Christchurch through.
  [Hat tip Owen McShane]
  The Katrina Effect: Renaissance on the Mississippi -  Joel Kotkin, N E W   G E O G R A P H Y
• According to Suffolk University economics professor Ben Powell, the three most common immigration myths are that immigrants are a drag on the economy, they steal our jobs, and that they depress wages. The evidence for those assertions is so weak that it takes Powell less than two and a half minutes to debunk them.
  As he concludes, “Whatever your position on immigration was before, if one of these three myths was holding you back, this should push you more on the margin toward wanting more open borders, not less.” [from Bastiat Institute by Ryan Young]
  

• What would the world look like if too many people spent too much time and money learning too little of anything that really matters a damn? Well, take a look around folks: we’re living in that world now.  Lot’s of folk with MBAs and PhDs, and too few to make stuff, fix stuff, and to come out weekends to repair your drains. (No, it’s not a conspiracy. It’s what happens when a market is as heavily subsidised as this one.)

• Let’s get this straight: GDP, that measures so-called Gross Domestic Product, does not measure production. It mostly measures consumption (i.e., spending by you and me at the shops, and spending by the government buying votes). And when it does measure production, it netts it out so drastically so that what it does count is only the very small tip of a very big iceberg. So it’s neither Gross, nor a measure of Production. In fact, in recent times, what it is coming to measure most is government spending, and their expansion  of the money supply. So, with that in mind …
  ... Can We Please Stop Pretending the GDP Is "Growing"?
  - Tyler Durden, Z E R O  H E D G E [ht Keith W.]
• How’s Australia doing? Strangely, there are still folk around that think it dodged an economic bullet. And oddly, Roger Kerr seems to be one of them.
  The State of the Australian Economy – R O G E R   K E R R ‘ S   B L O G
• Yes, Virginia, Australia’s housing bubble has burst. “First and foremost, house prices are falling.  We’re going to use the dreaded ‘f’ word here on television.  House prices are falling.” And: “The rate of decline is actually accelerating.”
  * 5 Myths That Won’t Stop an Aussie House Price Crash
  * Why Housing Will Fall as Hard as Silver But Take Longer to Recover 
  - Kris Sayce, M O N E Y M O R N I N G A U S T R A L I A
• And for the rest of the world? The crash radar is still on extreme.
  Why We Back Top Fund Manager’s Crash Call – Kris Sayce, M O N E Y   M O R N I N G   A U S T R A L I A
  Why the US is in Re-Recession – D A I L Y   R E C K O N I N G
• Will the economic pain in Spain stay mainly on their plain? No, it won’t. Spaniard wanting to fake the reality they’ve voted for won’t help.
   Forex focus: the pain in Spain – T E L E G R  A P  H
• Does New Zealand need a weak dollar?  No, we need a sound dollar. (The arguments here are essentially the same as they are in the U.S. )
  Do We Need a Weak Dollar? – Robert Murphy, M I S E S   D A I L Y
• Meanwhile, back in the States, rather than cut their profligate spending they’re still trying to pass a bill so they can government can raise the amount they can keep borrowing without breaking the law. ‎150 horrified economists have called for responsibility, and signed a letter opposing an increase to the debt ceiling. Paul Krugman was not amongst them.
  150 Economists Sign Letter Against Increase Of US Debt; Spoiler Alert - Paul Krugman Is Not Among Them – Z E R O   H E D G E
• Meanwhile, mainstream economists are still baffled by the US’s “slowing economy and low yields,” and that’s despite all the Keynesian stimulus they’ve had thrown at the problem. As Steven Kates implies, they’re only baffled because they haven’t learned to read more widely—like some of the folk you might read here.
  Are we still all Keynesians now? – C A T A L L A X Y

“The public debt is a double burden on the free market:
in the present, because resources are withdrawn
from private to unproductive governmental employment;
and in the future, when private citizens are taxed to pay the debt.”
- John Stuart Mill, “Of a National Debt,” as paraphrased by Murray Rothbard

[Thanks to Greg D. for the cartoon] 

• By the way, if you’re an “app” writer (and I know some of you are), then listen up. We could be reaching a “tipping point” in apps.
  Hitting a tipping point in apps – C O D Y  W A T C H
• “I wish I'd had the courage to live a life true to myself, not the life others expected of me.” A hospice nurse reveals the top five dying regrets of her patients.
  Regrets of the Dying – Bronnie Ware, I N S P I R A T I O N   &   C H A I
• Would you give up Vegemite for Amanda Palmer? Tough question.

Amanda Palmer in Sydney, with her Vegemite Song

• Here’s the world’s best Republican vibraphone player: Lionel Hampton.

Lionel Hampton and his band perform ‘Flying Home.’ Broadcast on American Television in 1957.

• Now how about this for a treat! Vladimir Horowitz play Liszt’s piano transcription of Richard Wagner’s ‘Liebestod.’  Magic.

Have a great weekend.
I will be.
Cheers
PC

GUEST POST: “Sorry about the sewage, we are too busy gardening in the Red Zone!”

I’m sure if you caught the news from Christchurch this morning you felt as I did.

While owners of central Christchurch property are being ordered by the government’s bureaucrats at CERA to cough up demolition plans for buildings they are aren't even allowed to visit, supposedly because it’s too risky for them, council gardeners are allowed in to central Christchurch to plant flowers—presumably to make wreaths to plant around the  businesses the council has killed.

In this Guest Post, Christchurch businessman Hugh Pavletich gives voice to some of the anger felt around the city:

“Sorry about the sewage, we are too busy gardening in the Red Zone!”
by Hugh Pavletich

Take a look at these:

    Gardening in red zone - The Press
    Gardening in Red Zone infuriates business owners - TVNZ
    Anger at red zone gardening - Newstalk ZB

Also.........

    Grass in house no grounds for rates relief - The Press
    Battle grows to reopen Dux - The Press

While the Christchurch City Council was insolent, incompetent and obstructionist following the 4 September 2010 earthquake, things are now even worse after the 22 February 2011 event. Another layer of bureaucrats  has kicked in with in the newly formed Canterbury Earthquake Recovery Authority (one with neither development nor engineering expertise). It would appear the Council has pretty much “kicked the can” to CERA, this new body, and is taking an even more relaxed approach to life—even as it enforces that same relaxation on the city’s business owners, who it still largely prohibits from accessing their own buildings.

These photos  below and reports ;linked above show 6 Council City Care workers tending a garden in the Christchurch’s CBD Red Zone, from which public and business and property owners, excluded. They are surreal.

That’s a lot of workers to weed one garden of course......but hey......that’s another story (see my “Christchurch: A Bureaucratically Buggered City,” from which the important Council hyperlinks have already been disabled – why?)

Obviously Mayor Bob Parker, CEO Tony Marryatt and the “management” think weeding plant beds in an area that is vacated is more important than employing these staff replacing the destroyed and mostly obsolete  sewage infrastructure in the east.

But, hey, at least they’re visible! Quite where all the grossly overstaffed 1,300 administrative / regulatory people usually located at the redeveloped Civic Offices are is something of a mystery.

These Civic Offices, the council’s brand-new “not fit for purpose” redeveloped and excessively expensive “green” building was “knocked out” for two months following the first earthquake event (at an estimated cost of rebuilding of $5 million, excluding much larger disruption costs)  – and for some four months following the 22 February event (est. cost or re-repair $10 million, again excluding disruption costs). It will not be reoccupied until the end of June. [And for the design of this “fit for purpose” building, the architect Ian Athfield has been reward with the job of Christchurch’s architectural czar. Cool, eh. – Ed.]

So where are they all and what are they up to? No doubt some Council staff are scattered around suburban service centres and libraries. Where are the rest? What are they doing?

This illustrates one reason the Council has insufficient money to meet its infrastructure responsibilities to the community it is supposed to serve.

It is past time to move from the current failed and bloated centralised model, to the "One City - Many Communities" one, in which elected community representatives and ratepayers might better monitor these guys.

There are two types of local government in this world – the small and the bad.

Christchurch can and will recover from these continuing  earthquake events and become an “opportunity city,” once we figure out how to get acceptable performance from our elected representatives’ and the public bureaucracies we pay excessively to serve us—and how to get them off our backs.

Hugh Pavletich

PETER SCHIFF: Markets swoon on double dip fears

Peter Schiff comments on the big U.S. stock mark sell-off, amid general weakness and fears (fears? what are we talking about: expectations) of the coming second crash—made worse by the resources consumed in the stimulus season.

So while the NZ Government bases Budgets on fantasies of “four-percent growth” over the coming year, in Australia, in Europe and in the U.S. things are heading rapidly downhill. And investors know it.

And no fear thinking China is going to pull us out of it.  They have problems of their own based on their own expansion of counterfeit capital to fake the expansion of GDP  and consequent over-production of malinvestments. And in China, even the malinvestments are bigger:

DOWN TO THE DOCTOR’S: Fan mail

Libertarianz leader Dr Richard McGrath offers inoculation against the nonsense appearing in recent stories and headlines

This week: Fan mail 

Rather than looking at the papers this week, I share below an e-mail recently received from a New Zealander who, like many others, is wondering just how long John Key can carry on the Smile and Wave charade before the whole pack of cards comes crashing down around his ears—a correspondent who cares that innocent people are being hounded by the same government that is meant to protect them:

I have been following your party for some time now and only voted National in the last election so we could get Labour out, as I’m sure many did. However I think its time to start promoting your party more and I have already started telling people about [Libertarianz].

The reason for my email is that I want to propose the idea of a new bill, called the Victimless Crimes Bill. Basically the idea is that if a person is charged with a crime, and they can prove there is not (or would not) be a victim, then they should not be charged. I am sick of victimless crimes in this country, it’s a disgrace.

As I said in response to him, the new boss is the same as the old boss. As Peter Cresswell has pointed out on numerous occasions on this blog, this National government continues to drive this country further into indebtedness by $300 per week per family. In every essential—and all too many of the details—they  are no different to Labour before them. And their attitude to victimless crimes is just the same.

Wikipedia, defines a victimless crime as

“an infraction of criminal law without any identifiable evidence of an individual that has suffered damage in the infraction.”

Surely the test of whether something is a crime should be whether someone was actually harmed by the actions of someone else. No harm – no crime.

The Libertarianz Party believes in the principle enunciated by John Stuart Mill in his essay On Liberty:

"[The] only purpose for which power can be rightfully exercised over any member of a civilized community, against his will, is to prevent harm to others."

Or to put it another way, government is force; and the only time that force may be exercised is to protect you from me—or me from you.  (Specifically, to prevent the initiation of force by one person against another.)  The only times a person or persons can be forced to do something against his/their will is, by extension, by right of self-defense or restorative justice (where people are compensated after sustaining proven objective harm, by the entity that harmed them).

At all other times, the government—to whom the power of retaliatory force is delegated by the individuals it serves—should turn the other way, even if some people find what other people are doing distasteful.

Lack of taste is not an initiation of force.  Which means:

• Homosexuality itself harms no-one, in the same way that heterosexuality is not inherently evil. There should be no laws that interfere in the peaceful interaction of adults.
• Cultivating, consuming and trading in cannabis (a natural plant) is another victimless “crime”, between adults and with the consent of all parties who take full responsibility for the consequences of their freely chosen actions.
• The same principle applies to the producers of erotica, to prostitution, to gambling and to other activities in which people are not forced to participate or actively support. As long as no coercion is involved, the State should let people do what they want. Once force is used by one party to violate the individual rights of another, however, that is where the State should step in to enforce compensation for damage or other loss.

This country needs fewer laws, not more of them. Yet while the National Party is in no hurry to remove the laws that prosecute victimless crimes, and persecute innocent New Zealanders, it is spending virtually every waking moment preparing and writing new laws to be passed under urgency.

On the other hand, the Libertarianz Party has always maintained that such laws—laws without victims—should be repealed. Immediately. That would be the beginning of paring the threat from government down to size.

In the meantime, and as healthy start on this road, my correspondent suggested a Victimless Crimes Bill be drafted. Damn good idea! The Libertarianz Party will get on to it. And who knows, there may be a libertarian-leaning party with MPs in the next parliament via whom such a bill might see the light of day, by Private Members ballot or otherwise.

Incidentally, who would have thought that blackmail is a victimless crime?

See you next week!
Doc McGrath             

This is tomorrow calling

There’s a little graph that started doing the rounds yesterday that someone’s tricked up to show that government debt here in NZ is just ten percent of GDP and falling.

It’s not.

The person who tricked it up is bullshitting you.

Government debt in New Zealand is over thirty percent of GDP and increasing—as we can see just by checking Dominique Strauss-Kahn’s website here:

26.164% of GDP in 2009, to
31.024 of GDP in 2010, to
32.653 of GDP in 2011, to
something even bigger in 2012 and beyond.

The simple fact is that this Government is borrowing over $300 million every week to cover the shortfall between its big taxes and its even bigger spending.  That's a new $300 debt added to the account of every New Zealand family, every week—and that figure is not falling, it’s growing.

We are in a crisis, and “politics as usual” is not going to get us out of it.

So why would the faker who tricked up the graph want to bullshit you?

Simple.

Because, like Bill English, and like John Key, they too want the government to keep faking reality and keep right on spending as if there were no tomorrow. Just as they did in Portugal, in Ireland, in Italy, in Greece, in Spain, in the UK, in the US … in pretty much every jurisdiction where the virus of welfarism has taken hold and convinced nearly everyone in them that the world owes them a living—and that they can vote themselves riches to make it happen.

But tomorrow is calling—and really very loudly. There is a worldwide sovereign debt crash coming, and when it does it won’t be pretty.

And just because the ratings agencies aren’t worried about it now, that doesn’t mean a thing. Those blind imbeciles were busy just a few short years ago giving A++ ratings to debt based on mortages given to unemployed homeless Americans—just before that particular world came crashing down.

Here’s Bryan Ferry & Chris Spedding.