Big Business & Big Government

One of the refrains I’ve seen of late is how capitalism failed and that’s why we are in an economic crisis. Something I’ve tried to explain to people in the past is that real capitalism is rarely seen in America these days.  What we have is huge corporations that dearly wish to be monopolies.  Monopolies don’t want competition, they want total control and are big believers in centralization.

So I’ve found it interesting how Republicans have been labeled the party of big business when so many big businesses mainly contribute to Democrats.  When big government and big business conspire, you get what we have these days.  What I am is a believer in competition of the free market which is different than being pro-business.  Jonah Goldberg has an excellent piece on this that everyone should read.

At Blogmocracy, Rodan has a post based on Goldberg’s op-ed that connects the union of progressives and big business with the policies of fascism.  In it, he uses a term I’ve used for years, Neo-feudal to describe the attitude of those wishing control through making everyone beholden to them. I have to point out that the ever increasing number of “czars” in the Obama administration accentuates the impression of feudalism to me.  Having people with cabinet level power who directly report to the President is all too much like vassals reporting to their lord, in my view.

I will say that the video in the post is annoying, it has some good content on socialism and George Orwell, then completely goes off the rails with the cartoony stuff at the end.

I think a fundamental human mistake is to vest power in one organization and then have all the decisions be made at the top.  This is the essence of centralization and history shows that it leads to inflexibility, inefficiency, and corruption every time.  This applies to businesses, organizations, political parties, and governments equally.

But here we are, repeating the same mistakes and being shocked when it goes wrong. While I think people are starting to wake up and see what is happening, I wonder if it is too late.  The consolidation of power by the federal government and large corporations has been going on for some time now.  The ACTA shenanigans are a good example of how it works, with the US government doing the bidding of the entertainment industry.

The solution is smaller government and small business.  A focus on these things will lead to better economic and political health in the country.  But will the American people do what is needed to bring reform about?  That’s the multi-trillion dollar question.

Economic Worries in Europe

Plus a Black Friday Update

There are a couple of worrisome reports from the Telegraph today, one about Germany and the other about the UK.

Germany

Chancellor Angela Merkel has proposed another bank bailout in Germany as part of another large economic package.  This is not a popular idea with the public and I sense a hint of desperation involved.  Another credit contraction has been predicted with 90 billion Euros of bad loans being written off in 2010.

A survey by Munich's IFO institute revealed yesterday that lending conditions in Germany had tightened sharply in November. Some 53pc of large manufacturing companies found credit hard to obtain, suggesting that the problem has spread beyond small firms without access to the bond markets. "The financing situation of firms remains critical and poses a risk to economic recovery," said the group's president, Hans-Werner Sinn.

If the problem is spreading to the larger industries in Germany, that spells trouble for all of Europe because they are the manufacturing engine of the EU.  What worries me even more is the solution Mr. Sinn proposes:

He said it was an error for the government to buy toxic debt, urging Berlin to direct equity stakes in the banks through partial nationalisations.

Oh great, fascism in Germany, what could go wrong with that?  It makes bailing the banks out look good by comparison.

Interesting stuff, but the quote of the article involves something I think is happening in the US as well:

Volker Treier, chief economist for the German chamber of industry and commerce (DIHK), said worries were mounting among Mittelstand family firms. "The real test has yet to come: the drastic decline in sales has not yet shown up in balance sheets," he said.

I have to wonder what our balance sheets really look like. Creative accounting may be hiding a lot of bad news.

United Kingdom

Over in Britain, Morgan Stanley has warned that the UK may have a massive debt crisis next year. The US company’s prediction is that the economy there will collapse completely, taking the pound sterling down another 10%. Oddly enough, they think the dollar will go up, so I am taking their analysis with a shaker of salt.

Quote of the article:

While the report – “Tougher Times in 2010” – is not linked to the Dubai debacle, it is a reminder that countries merely bought time during the crisis by resorting to fiscal stimulus and shunting private losses onto public books. The rescues – though necessary – have not resolved the underlying debt problem. They have storied up a second set of difficulties by degrading sovereign debt across much of the world.

Boy that really gets to the point.  All these stimulus packages and bailouts have been stall tactics with long term negative consequences. When all is said and done, historians will look back and point to them as madness.  Well, except for utopians who think government solves everything, I don’t think that will ever go away.

Black Friday in the USA

Here in the States, Black Friday weekend sales were disappointing as while there were more shoppers, they each spent less. Unemployment and under-employment still loom large with no relief in sight. Personal debt is at suffocating levels too. Is it any wonder people are spending less?  Hoping the consumer will bail us out is ridiculous as long as there is high unemployment.

Wish I could find some good economic news for the future.

A Truly Useless Idiot

Sometimes there will be a public figure that gathers a following with rhetoric and positions that sound reasonable, even if you don't agree with them.  Then at a later point, the mask will come off and they will be revealed as nutcases or evil manipulators of the truth.

I haven't decided which Pat Buchanan is or if he is both.  But it is clear that he has very strong fascist leanings with his continued attempts to rewrite the history of WWII and Adolph Hitler in particular. There are so many things wrong with his statements in this article that I barely know where to begin.

First off, Hitler did want war, trying to make him out to be a peacenik who was forced to invade Poland is utterly deranged.  The British escape at Dunkirk enraged him as a failure to crush his enemy, he didn't let the troops escape.  The only reasons he tried peace attempts with Britain was due to his plans to double cross Stalin and invade the Soviet Union -- Adolf didn't want a two front war because of the drain on materials and troops. His dream of succeeding where Napoleon failed drove his foolish attack on the Soviets.

Then there is the farcical question about the Luftwaffe only having twin engine bombers.  The Nazi scientists were working on and did have four engine bomber designs, but they were at a low priority.  Why?  Simple answer:  they planned on having captured airstrips to fly their bombers from thanks to the blitzkrieg attacks being so successful at taking land.  The twin engine bombers were perfectly suited to this, where the four engine bombers needed large airstrips, as the US Army Air Force found out in the Pacific and England. Hitler's plans were concentrated on continental Europe and I often wonder what horrors would have happened if he's only had the one front war he expected.

Buchanan is either an outright liar or insane to be pushing this garbage, though history shows that both conditions are not mutually exclusive.  What is apparant is that Buchanan is a neo-Nazi, not just a sympathizer, but the full blown fascist that haunted the 20th Century.

He should be accorded no respect and his viewpoints widely publicized so that people will know what he really is.