On Liberty Watch

Remember not so long ago when there was a constant (and often justified) outcry against the Trump Administration’s use of government power to quell dissent? Well, the use of government power to quell dissent has not ended. In fact it has probably intensified. But somehow or other the objections seem to have faded away, which suggests that the objections weren’t about the use of government power to stifle rights. On the contrary the objections were about who was using the power, not the power itself.

For example, consider the video below by John Stossel.

JFB

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As a consequence of Russia’s invasion of Ukraine, certain hard truths* have emerged even as America busied itself with discovering the proper use of pronouns. Chief among them is that modern liberalism, let’s call it the American variant, is a smoking ruin. 

*Trigger warning. The use of the term “Truth” is deliberate, meant to imply that there is actually such a thing. Those who find the term offensive—second trigger warning on the way—can go jump in a lake. 

Anyway, back to the substance. 

American liberalism isn’t merely responsible for the catastrophe that is the Russia-Ukraine war. The underlying philosophy of American liberalism has produced a whole catalogue of mini-catastrophes that in the aggregate serve to repudiate the oft-stated claim that liberalism represents pragmatic governance based on “what works”. 

To begin with, let us consider how well it has worked in foreign policy. President Biden, who, we should recall, was President Obama’s point man on Ukraine, decided to prevent Russia from invading Ukraine by broadcasting what our vaunted intelligence services knew, or claimed to know, about Russia’s plans.  Did President Biden achieve his stated objective? No. He failed. 

Where then, it is fair to ask, is the famed “international community” we keep hearing about? Nowhere to be found. Except perhaps for an emergency meeting of the  United Nations Security Council, called after the invasion had already begun. The chair of the Security Council was—wait for it—Russia. Enough said.

And just how is NATO looking today? Germany still refuses to turn its nuclear power plants back on. With its aggressive green agenda, Germany has made itself vulnerable to an energy squeeze by Russia. Mr Biden has done his bit by shutting down the Keystone Pipeline. He has also nominated Fed governors who have advocated using stress tests and other regulatory measures to deny financing to the fossil fuel industry. 

And then while cheering on Germany’s renunciation of nuclear power, the Biden Administration continues to pursue re-opening the Iran nuclear deal. The result will be to allow Iran to develop nuclear weapons while pretending to develop nuclear energy for “peaceful” purposes. Kind of like the riots in the summer of 2020 were mostly peaceful. 

Then there is the ignominy of the U.S. surrender in Afghanistan that was engineered by Joe Biden. A surrender surely noticed by Vladimir Putin. As a result of it, American citizens and green card holders are trapped in that country, now under Taliban rule. In addition millions of Afghans face the possibility of starvation. All because what started out as a defense of the U.S. homeland after the 9/11 attack morphed into a doomed Wilsonian exercise in nation-building under President George W Bush. 

And let’s not leave out the 2003 invasion of Iraq, which among other things was predicated on our famed intelligence services assertion—with “high confidence” a “slam dunk”—that Iraq possessed weapons of mass destruction. Weapons that have yet to be found, and never will be. But as is typical of government, the author of the slam dunk quote, George Tenet, was awarded the Presidential Medal of Freedom, the nation’s highest civilian honor. For what exactly is the question that comes to mind.

The fiasco that is foreign policy is mirrored by the cascade of domestic policy failures that is the hallmark of the Biden Administration.  Remember that Mr. Biden was going to shut down the virus by July 4, of 2021? How did that work out? More people have died of Covid under Mr. Biden than did so under Mr. Trump. That is true when adjusted for comparable time periods, as well as in absolute terms. At least Mr. Trump got effective vaccines developed in record time thanks to Operation Warp Speed, saving countless lives.

And now all of a sudden, and just in time for the State of the Union message, the supposedly independent CDC has discovered—mirabile dictu—new science that allows them to greatly relax mask mandates. Never mind that there were already plenty of studies demonstrating the absurdity of the policy regime. 

But Mr. Biden, along with AG Merrick Garland, of the supposedly independent DOJ made great strides in painting parents of school children as “terrorists” because they objected to the mask mandates and public school propaganda in general. The infamous Garland memo equating parents with terrorism arrived with help from the teachers unions who “suggested” the terms to be used. 

Of course there is the temporary problem of inflation. That’s the inflation that Mr Biden assured us was not going to happen. He also assured us that any uptick would merely be transitory. Well it’s been transitory for about 9 months now and shows no sign of abating. 

But he has a solution to the problem that was caused by excessive spending, borrowing and money creation. Spend and borrow even more money. Create even more demand, and regulate production even more stringently. Bernie Sanders is in favor. So is Elizabeth Warren. And Nancy Pelosi. And Chuck Schumer. And Dick Durbin. And the Squad. That should settle it.

Of course there is the crime surge to deal with. That’s the crime surge that is happening all across the major urban areas of the U.S. that just so happen to be run by—liberal Democrats. Not only that, with the help of prodigious fund raising by progressive groups (when Republicans raise campaign funds it’s called “dark money”) they have elected extremely progressive District Attorneys who refuse to prosecute crimes like burglary and robbery. 

Not surprisingly, there have been severe outbreaks of crime. Companies whose stores have been robbed and ransacked by thugs with impunity—firms like CVS—have announced lots of store closures in urban areas. Just wait for a few months for the wailing to begin about how corporate America is redlining urban areas as if that is the real story.

While all this is going on, traditional public school performance has plummeted, particularly in low income income areas, where performance was already lagging badly. Needless to say, no one this side of sanity actually believes that mandatory mask wearing for 5 year olds makes (or made) the slightest bit of difference in stopping the Corona virus. But closing the schools has had a very large negative impact both on learning and the social development of kids, especially minority kids. And it goes without saying that the school districts most negatively impacted are those located smack dab in the middle of deep blue cities. 

However the school boards of those cities do have certain accomplishments. They have removed the names of George Washington and Abraham Lincoln from schools. They have instructed 5-year olds in the finer points of gender fluidity and they have rewarded teachers unions handsomely. 

So why is this laundry list of policy failures—and that is what they are—the result of American liberalism. Note I said “liberalism” with a small L, to distinguish it from the Classical Liberalism of the Scottish Enlightenment. Underlying the current American variant is the profoundly mistaken belief that human nature is infinitely malleable. That through proper social engineering human beings can be programmed to behave “correctly”. All that needs to happen is for conditions on the ground to be closely managed by central planners. Hence the Administrative State. 

That is why we have mask mandates; why schools are being turned into propaganda factories; why language is deliberately being used to obfuscate rather than elucidate (see pronouns); why obvious sex differences are being redefined as gender “choice”; why dissenting opinion is stomped out through cancellation. 

In short contemporary liberalism is at war with human nature. Consequently, it is also at war with the foundational tenets of Western Civilization. It denies the agency and dignity of the individual human person. It deems individuals as mere cogs in a machine; that decision making by individuals is simply an illusion cloaking what really matters: things like race, class and gender. Ultimately they argue, it is power that is at the heart of all human relations. Power without decency or restraint. Like Mr. Putin’s for example. 

That is the power that contemporary liberals crave. What else explains the liberal assault on free speech, on religious practice and the adoption of cancel culture? They know what’s best for you.

In the end the burgeoning authoritarianism of contemporary liberalism will fail because authoritarianism always fails when faced with freedom. All signs point to the new authoritarians losing badly when November rolls around. The question is: Will the Republicans reject Donald J Trump, act like adults, win in November and lay the groundwork for a restoration of liberty in the United States? 

It seems increasingly likely that the Republicans will win handily in November. All to the good. The jury is still out on the rest of it though. 

JFB

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On January 20, 1961, President John F. Kennedy delivered his inaugural address after having won the Presidency by one of the smallest margins in U.S. History. In that address, undeterred by his margin of victory, he said “we shall pay any price, bear any burden, meet any hardship, support any friend, oppose any foe to assure the survival and success of liberty.”

On June 12, 1987 President Ronald Reagan stood at the Brandenburg Gate of the Berlin Wall where he said “Mr. Gorbachev, open this gate! Mr. Gorbachev, tear down this wall!”

Those men could speak like that because they were confident of America’s future. They were confident in America’s future because they knew that it rested on a foundation of liberty.   

On November 9, 1989 the Berlin Wall came down as the Soviet Union imploded. 

A funny thing happened between then and now. Unlike Presidents Kennedy and Reagan, current and former Presidents Joe Biden, Barrack Obama and Donald J Trump, didn’t and don’t give a hoot about liberty. They are all about using the coercive power of the administrative state to re-engineer American society. While they may pay lip service to the idea, fundamentally, they simply do not believe in the power of liberty and the promise of a free America.  

That is why Obama and Trump were failures and why Biden is failing right before our eyes. Consider for instance, Biden’s handling of Russia’s aggression against Ukraine. For the first time since World War II a European power has launched a military invasion of a neighbor, with the prospect of still more aggression yet to come.  

And what has been the Biden Administration’s response? Well, they predicted what Russia would do and used diplomacy to deter what they predicted would happen, from actually happening. In the end, Vladimir Putin simply ignored Biden and invaded Ukraine. So on his own terms, Biden failed. 

Biden then announced that he and our allies were united (which we are not) and would impose sanctions on Russia. Sanctions that are supposed to do what, exactly? No one seems to know. The sanctions are essentially toothless in that they have not, and will not in the future, dissuade Vladimir Putin from doing what he wants. Which is to resurrect some semblance of the old Soviet Empire.

Putin’s effort will no doubt fail and eventually come crashing to earth. But that is no thanks to the U.S. foreign policy establishment. Putin simply lacks the financial muscle or diplomatic savvy to succeed. Consider some numbers. In 2020 Russian GDP expressed in dollars was about $1.479 trillion, only about 55% of the UK’s GDP which was $2.7 trillion. In terms of per capita GDP, Russia’s was only $10,225, which is only about 25% of the UK’s $40,428. 

Russian defense spending was about the same as that of the UK; $63 billion for Russia compared to $60 billion for the UK. When viewed in terms of government budgeting, a whole other story emerges. Russian defense spending represents 11.4% of the budget; but only 4.23% of the UK’s—because the UK economy is so much bigger.  In the end Russia is a gas station armed with nuclear weapons. The burden its government imposes on its citizens is plainly enormous. 

And just to be clear about all this, while Russian GDP is only around $1.479 trillion, the GDP of the Eurozone is $13 trillion, while the GDP of the US is  $22.9 trillion. The population of Russia is 146 million people. US population is 329 million and the Eurozone population is 342 million people. 

So why are the Western allies so hesitant to step up? The citizens  of the Eurozone have been more than happy to let the US bear the burden of their defense. Moreover they are far more likely to view these rivalries in ethnic terms, rather than ideological terms as the US does (or did). 

A second, and probably more important factor is that much of the foreign policy establishment in the US has bought into the idea of American decline. Consequently, US politicians do not lead with confidence as Kennedy and Reagan did. In fact, they don’t lead at all. Mostly they are born followers who prefer bureaucratic rule making to the dynamism of free people and free markets.  

But it is always darkest before dawn. Back in the late 1980s all the talk was of America being overstretched. Anticipating the declinism of Donald Trump, Patrick Buchanan published “A Republic, Not an Empire”. Paul Kennedy a Yale historian published “The Rise and Fall of the Great Powers”, suggesting that the US was falling victim to imperial overstretch. Every management guru thought that Japan was going to rule the world. President Reagan and Margaret Thatcher were constantly being told not to upset the Kremlin.  

The experts never guessed that the Wall would ever come down. But it did. The experts never guessed that Japan’s economy would be sluggish and close to zero growth for the next 30 years. But it was. The experts never guessed that inflation would come tumbling down and usher in the 25 years of growth that economists now refer to as the Great Moderation. But it happened.

The experts were sure that there were nuclear weapons in Iraq. They are still looking for them. They were positive that they could bring down health care costs with Obama Care. Enough said about that. In March of 2020, Dr. Fauci, then of the Trump Administration asked people to stay home for 15 days to slow the spread of the Corona Virus. Two years later the CDC is still on its mandate kick. 

In the summer of 2021, the experts assured us that inflation wasn’t a problem, it was merely transitory. That social protests in big cities were “mostly peaceful” while buildings burned on TV screens. That there wasn’t really a surge in violent crime. And so on.

We have gone through this sort of thing before. America always seems to muddle through, despite expert predictions. We will again. But it’s going to be a long hard slog. The first sign of a turn around will be the scaling back of the Nanny State, accompanied by a robust defense of the culture of liberty. With any luck, it could begin as early as November. 

JFB

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As soon as you can.

Shen means divine or divinity. Yun means feeling or rhythm. Shen Yun means “The beauty of heavenly beings dancing.” Shen Yun, based in New York, comprises 7 dance companies that perform all over the globe. We just saw it in the Kennedy Center for the Performing Arts. It is simply spectacular; a show that should not be missed. If you go to one ballet this year, Shen Yun should be it. 

The show uses Chinese mythology to tell stories that transcend particularism. The themes are essentially universalist. In some ways they are Shakespearian, in some ways Christian. The themes address the ideas of right and wrong, sin and redemption, truth, compassion and tolerance. These are qualities that recognize the dignity of the individual human person. They are also ideas that are an anathema to the Chinese Communist Party (CCP). 

Shen Yun intends to recapture the traditional culture and values of China; a civilization has been with us for 5,000 years. Since Shen Yun is an offshoot of the Falun Gong movement, the CCP has forbidden the performance of Shen Yun in China. The traditional values it espouses are a mortal threat to the CCP. So the Party has been trying to stamp out religious belief and traditional Chinese culture ever since Mao and the Communist Party came to power in 1949. 

They, like all totalitarians, mean to make a New Man, one who is infinitely elastic and perfectible; one who fits the the proper image of the ideologues. That alone is worth thinking about, particularly when considering the joyless idealogues who have captured so many universities in America. After all they are attempting to do precisely the same thing. First they come for the statues; then they come for the people. What is cancel culture all about, if not to de-platform and silence people guilty of wrong think? And what happens to the robust debate that is part of our heritage if stifling conformity becomes the norm?

As conservatives never tire of pointing out out, politics is downstream from culture. It should be painfully obvious that the goal of the new authoritarians is the destruction of  Western culture that lies at the heart of our civilization. The better to re-create the ever malleable New Man who will do what he is told. Perhaps progressive camp followers in the media are simply too naive to realize it.  

Shen Yun provides an effective retort to the attempt to the new cultural vandals. By telling stories based on Chinese mythology, it champions the dignity and worth of the individual human person. It is a rebuke to the social planners who seek to create a New Man in their own image. (Take a look at the Video below). 

It is also worth noting that the horrors of the 20^th century were not brought about by the Scottish enlightenment, now in so much disfavor, and derided as justification for colonialist white supremacy. Rather it was Adam Smith, David Hume, John Stuart Mill and others of the Scottish Enlightenment who provided the intellectual framework for developing modern institutions of liberty. 

Classical liberals are not the problem. It was instead Western utopians who provided what became justification for the world’s most prolific killers. Stalin, Mao, Castro and Pol-Pot among others originated in the writings of  Marx, Engles, Sartre, Proudhon, Robespierre and Lenin; and not to put too fine a point on it, cheerleaders in the press like Walter Duranty. 

It was widely reported, perhaps incorrectly, that when queried about all the death and destruction wrought by Stalin, Walter Duranty is said to have replied, “You can’t make an omelet without breaking a few eggs”. To which George Orwell replied, “Where’s the omelet?”

We are still waiting for that omelet–the one that will never appear. 

JFB

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In the matter of Ukraine, policy makers in Washington appear to be obsessed with finding an answer to a question they think will unlock the formula for maintaining the peace in Europe.  That question is: What does Putin want?

It is an interesting question. It is also the wrong question. It implies that the solution to the developing crisis in Europe is transactional. Once we discover what Putin wants, the next step is to find a face saving way to give it to him. Otherwise we impose economic sanctions. Just like we did in Iran. And how is that working out anyway?

What is notable about this episode is the extent to which Western thinkers have mischaracterized the problem. David Brooks, an opinion writer for the New York Times, summed up the conventional wisdom the other day on PBS.  He argued that the seriousness of the Russia – Ukraine dispute was centered on the willingness of a large power (Russia) to use force to impose its will on smaller nations—like Ukraine.  In so doing, he argued, Russia was endangering the rules based liberal order put in place as a result of the catastrophic destruction wrought by the two World Wars of the first half of the 20^th century.  

That is indeed the conventional wisdom. It also misses the point. There is a reason why the rules based system worked as well as it did for as long as it did. The reason does not lie in the work of the post war institutions we built like the United Nations, the Word Trade Organization, the World Bank and the International Monetary Fund (IMF). Those organizations are simply instruments of Great Power geopolitics. 

The reason why the liberal world order flourished as it did is that the United States enforced the rules. Great Power politics did not vanish with the creation of a liberal international order. The United States emerged from the ashes of World War II with so much concentrated power that it was in a position to dominate the construction of the political and financial architecture of the emerging era. 

But those institutions, largely instruments of American power, were never going to be permanent. As the relative positions of other Great Powers began to improve vis-a-vis the United States, what had become became known as the Washington Consensus strained to adapt. While the United States largely held the Western Alliance together through NATO, other existing powers began to revert to old habits, particularly, Russia. 

Leave aside for the time being Russia’s general suppression of Eastern European countries through the Warsaw Pact. Russia also invaded Hungary (1956) and Czechoslovakia (1968) to put down local attempts at liberalization. They put nuclear missiles in Castro’s Cuba in 1961, constructed the Berlin Wall in 1961 and invaded Afghanistan in December 1979. And all along the way they supported various national wars of liberation around the globe. 

The only thing standing in the way of more aggressive (what was then) Soviet behavior was the United States. When the wall finally did come down in 1991 it took with it the Soviet system. It wasn’t just the military power of the United States that Russia faced. The U.S. combined military power with soft power. Who can forget Reagan’s speech in front of the Berlin Wall when he said  “Mr. Gorbachev, Tear down this wall”. 

But the fall of the Berlin Wall  did not take down the dreams of socialism, autocracy and ultimately totalitarianism, although by rights it should have. Vladimir Putin, who went from being a junior KGB operative in Eastern Europe to a cab driver in Moscow, described the collapse of the Soviet Empire as “…the greatest geopolitical tragedy of the 20^th century.”

That hints at the answer to the question: What does Putin want? First and foremost he wants to protect and expand his power. That means destroying NATO, hence his demand that the West pledge to never admit Ukraine to the alliance.  

To a large degree Putin has already succeeded in knocking NATO back on its heels. He merely has to deliver the coup de grace. Remember the original goals of NATO: Keep Germany down; Russia out and America in.  Now consider, the response of NATO and the United States to Russian aggression in the matter of Ukraine. 

Germany is continuing with its plan to approve Russia’s Nord 2 gas pipeline which runs from western Russia to north-east Germany, bypassing Ukraine. This will make Europe, and particularly Germany, dependent on Russia for its energy supplies. And not to make too fine a point of it, former German chancellor Gerhard Schroder went to work for Gazprom and sits on the Board of Rosneft, Russia’s biggest oil producer.

In the meantime the Biden Administration has threatened “swift and severe sanctions” should Russia invade Ukraine. But it is hard to imagine that Vladimir Putin will be shaking in his boots over anything that the Biden Administration says it is prepared to do. Already the Administration has looked for an off-ramp by trying to make a distinction between a “minor incursion” and an invasion, albeit with some belated after-action clean-up. 

Then there is the matter of the botched Afghanistan withdrawal and the subsequent lies about it. (See today’s Washington Post for one example among many). Honorable mention goes to the Biden Administration’s obsession with getting  a “deal” with Iran despite the fact that Iran continues to ramp up its nuclear weapons program and has recently tested a ballistic missile capable of reaching Israel.  

All things considered the question that matters is not what does Vladimir Putin want. The real question that matters is: What does the United States want? Another way to put it is: What is in the best interests of the United States, and derivatively, the West? Which is not the same as what is in the best interests of Joe Biden’s political standing, which seems to be the driving force of his policy making. 

Faced with the correct question to ask, we are immediately confronted by a problem. It ought to be obvious that the default position of mankind is not peace and prosperity, all the nonsense about the Noble Savage notwithstanding. Achieving those goals requires constructing both institutions and leaders capable of delivering and sustaining them.

The existential problem we face—and it truly is an existential problem—is that America’s scholars, public intellectuals, universities, thought leaders and cultural arbiters no longer believe in the intellectual infrastructure that made the modern Liberal state possible. The classical Liberalism of the Scottish Enlightenment developed by Adam Smith, David Hume, John Locke and Edmund Burke are based on the idea of natural law; that there are universals that spring from that idea; that among them are the right to life and liberty; that those rights in turn depend on property rights and the right of contract; that the rule of law applies equally to all and that it is the job of Government not to create, but to secure those rights. Those beliefs are what made America, America. And the institutions built on those beliefs are what allowed those 13 colonies to become the richest most powerful country in the world.

But today’s progressives do not believe that, campaign rhetoric aside. Today’s progressives are determinists and racial essentialists. For them, race, class and gender are determinative. The hierarchy of oppression is the scorecard. The hysterical opposition to school choice, the insistence on forcing 5-year olds to wear utterly useless masks in schools (when they are open) and acquiescence to the 1619 project and “anti-racism” in public schools give the game away. Which is: Command-and-Control. 

That ideology, for the moment, dominates public discourse. And it is why policy makers are incapable of formulating the right questions to ask, much less coming up with the right answers. And why they shy away from global leadership. They cower in fear of being called Neo-colonialists.

Shortly after John Kennedy was inaugurated as President  he went over to Foggy Bottom and asked various employees whom they represented. The answers came back quickly—France, England, India, Japan, Egypt etc. Whereupon Kennedy reportedly asked “Where is the American desk?” 

That is a question we should be pondering today. Another is: what would the world look like if America were to abdicate its role as global leader and enforcer of liberal norms. Answer: It wouldn’t be pretty.

JFB

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Poor Joe Biden. You almost have to feel sorry for him, surrounded as he is by a multitude of disasters. But since they are largely the result of President Biden’s policy choices, we should feel sorry for the citizenry that is paying the price for his incompetence. It’s actually worse than that because while Candidate Biden promised to govern as a moderate, he is being led around by Bernie Sanders (VT-Rolling Stone)

Let’s face it, Mr. Biden’s  staff puts a speech filled with happy talk in the teleprompter. He proceeds to read it and by the end of his remarks it is clear to sentient beings everywhere that Mr Biden doesn’t have the slightest idea what he is talking about.  

Consider the inflation situation. Back in June of 2021 when the inflation rate was racing ahead at 5.4% here is what President Biden had to say. 

“The vast majority of the experts, including Wall Street, are suggesting that it’s highly unlikely that it’s going to be long-term inflation that’s going to get out of hand,” Biden said. “There will be near-term inflation, because everything is now trying to be picked back up.”

Leave aside the horrific grammar that seems to be endemic among ex-Senators. Also leave aside the minor fact that there is zero evidence that the “vast majority of experts”, by which he presumably means economists (other than the cheerleaders at the Fed) have actually signed on to this particular piece of economic incoherence. The fact is that the inflation rate, which was 5.4% in June is now 7.5%. And the word transitory, as least as it pertains to inflation,  has been shoved into the memory hole. 

In the wake of todays report of the highest inflation rate in 40 years President Biden gamely soldiered on. He announced that “While today’s report is elevated, forecasters continue to project inflation easing substantially by the end of 2022.” 

A better way to put is that those forecasters continue to be flat out wrong, and for the same reason they have been wrong all along. They are relying on a 70 year old model based on the Phillips Curve that is a relic of a different era. That model posits the idea that there is a predictable trade-off between the unemployment and inflation rates. As inflation goes up, unemployment goes down and vice-versa. Policy makers merely have to pick the optimal trade-off point as they set interest rates.  

That idea was wrong when it first surfaced in the late 1950s and it is still wrong today. But bad ideas never die; they just lie in wait for the next opportunity. So progressive policymakers who should have but didn’t learn from the experience of the 1970s  when President Jimmy Carter (and Presidents Nixon and Ford) made the same mistakes, have seized the opportunity to mess things up royally. 

And so here we are with 7.5% inflation and shortages on grocery store shelves. The shame of it is that this was an avoidable disaster. And it shows no signs of getting better anytime soon, pace Mr. Biden. 

The reason why prices are soaring is because of the policies championed and implemented by Mr. Biden and his Progressive buddies. They have been spending money like drunken sailors (with apologies extended to drunken sailors) and show no sign of remorse. Instead they continue to tout themselves as modern Messiahs who will right all wrongs in the pursuit of justice. 

Back on planet earth it is (or ought to be) crystal clear that soaring prices are the result of constrained supply brought about by lock-downs, transfer payments from savers to spenders, and the re-imposition of a regulatory regime focused on social justice goals rather than economic efficiency. At the same time the Progs have thrown scads of money hot off the Fed’s printing press at every conceivable social justice cause thus pumping up aggregate demand. 

We have constrained supply and increased demand. And we did it on purpose. It was integral to a disastrously failed anti-Covid strategy. Of course prices soared. What in the world did they think was going to happen? And they will continue to do so until the policy regime is reversed. But that would amount to a repudiation of the policy regime brought to us, or I should say, imposed on us by Bernie Sanders, Joe Biden, Chuck Schumer, Alexandria Ocasio-Cortez, Elizabeth Warren and the whole crowd of collectivists who currently own the Democratic Party. 

And since they are not about to admit the obvious, namely that they are simply flat out wrong, they will have to be asked to give up the reins come November. And then we will have a brand new bunch of economic illiterates to deal with. 

JFB

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According to the Washington Post,  

“…the current Fed chair, Jerome H. Powell, has dismissed claims that the Fed’s money-printing is fueling today’s price spiral, emphasizing instead the disruptions associated with reopening the economy. Like his most recent predecessors, dating to Alan Greenspan, Powell says that financial innovations mean there no longer is a link between the amount of money circulating in the economy and rising prices.”

Really? The Fed now maintains there is no longer a link between the amount of money in circulation and rising prices. Then why are they poised to raise the target rate for federal funds and reduce the size of the Fed’s balance sheet in March? Both of those policy shifts will reduce the amount of money in circulation, thereby lowering effective demand ceteris paribus. That, after all, is the point. 

The Fed is up to its old tricks, trying to change the subject so as not to be held accountable for the explosion in inflation that it sponsored. The Fed insists that it has the tools to deal with inflation should it become a problem. Well inflation has become a problem. The question is not whether the Fed has the tools to address the problem. The question is whether the Fed has the will to use the tools at its disposal. 

Consider the history. For years, a decade actually, the Fed’s stated policy goal was to increase the inflation rate to 2%. This it failed to do. Between the years 2010 and 2020 the inflation rate averaged 1.73%, staying between a low of 0.7% and a high of 3%. 

Then, during the first quarter of 2020,  in response to the Covid-19 pandemic the Fed drove short term rates to zero, created credit facilities for entire swaths of the economy and expanded the assets on its balance sheet from about $4 trillion in January of 2020 to  $8.8 trillion by the end of 2021. The broadly defined money supply rose 35% from March 2020 through December 2021. Unsurprisingly the inflation rate, which had been humming along at 1.4% in 2020, soared to 7% in 2021. 

It is important to understand the implications of the Fed increasing its balance sheet. The Fed began buying Treasury and Mortgage Securities, thereby increasing the assets it holds. On the liability side the Fed increased its “liabilities” by creating the dollars it needed to buy the assets it added to its balance sheet. In effect it just printed the money, thereby increasing aggregate demand. 

Another thing happened on the way to this explosion of money creation. The Fed took Congress at least partially off the hook. The Fed enabled the Congress to spend trillions of extra dollars without worrying about financing. By purchasing gargantuan quantities of Treasury securities, the Fed provided the necessary financing.  In so doing it blurred the distinction between fiscal policy (taxes and spending) and monetary policy (interest rates and the money supply). 

It is also notable that inflation rates are soaring around the major industrialized economies of the West, largely because they have adopted the same foolish policies. The ECB drove interest rates into negative territory, and UK rates were tamped down by the Bank of England. The inflation rate in the UK recently clocked in at 5.4% in December, the highest reading since March 1992. This Thursday’s Consumer Price Index (CPI) is expected to be somewhere between 7% and 7.3%. 

The political backlash is building as a result. Real (inflation-adjusted) wages are falling in the U.S and the U.K. because although nominal wages are rising, they not keeping up with inflation. Energy bills are set to rise in the UK by 50%. They are also set to rise substantially on the continent. Gas prices in the U.S. have risen 40% since December 2020. Chalk rising energy costs up to a combination of bad monetary policy and green energy initiatives. 

We should be absolutely clear why the inflation rate is soaring across the Western economies. Policy makers have systematically driven interest rates down to zero and expanded Central Bank balance sheets, thus increasing effective demand. At the same time they constrained supply with lock-downs, green energy policies, more income transfers, and expanded regulation. Constraining supply and pumping up demand produces higher prices. There isn’t any mystery about it.

Policy makers are already trying to pin the blame elsewhere. Such economic luminaries as Elizabeth Warren (D-MA) are already complaining about “corporate greed” as if human nature abruptly changed when progressives came to power. Andrew Bailey, Governor of the Bank of England, foolishly asked Britains not to ask for wage increases to offset inflation. As if workers, not policy makers, were the problem here. Meanwhile over in Brussels, at its last meeting the ECB declined to raise its policy rate despite exploding inflation on the continent. And of course, progressives in the U.S., always searching for bad ideas to implement are hinting wage and price controls. 

The fact is that policy makers in the leading Western economies created the financial mess we are in by spending too freely,  suppressing interest rates, and piling on more and more regulations. We have seen this movie before, and it doesn’t end well. To put the economy on track for long term sustainable growth it is going to take significantly higher interest rates, reduced government spending and scaling back the regulatory burden of the nanny state. Which is to say, a complete and utter rejection of the progressive politics of Command-and-Control.  

JFB

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Bari Weiss, is the former New York Times journalist who resigned in in July of 2020 in protest over the stifling conformity and illiberalism of the paper of record. Now she runs a phenomenally successful substack newsletter named Common Sense. It is always a good read. 

Today’s edition has a column by Suzy Weiss titled “Revenge of the Covid Moms”. In it she writes about the anger and disgust of those she calls “Covid Moms” who are angry and disgusted with the mask mandates that have been imposed on school kids. 

For the most part these are highly educated liberal women who make their homes in deep blue urban enclaves. Most importantly, they have school age kids and have been able to observe first hand the effects of masking requirements on their own.  The scales are falling from their eyes. 

Maud Maron who lives in Soho with her husband and kids got so disgusted with the situation that she decided to challenge Carolyn Maloney, a mask aficionado and 30 year veteran Congresswoman, in the upcoming Democratic primary. Weiss quotes her as saying “When you shut down my kids’ schools and impose devastating mental health effects on them—I don’t forgive anyone who did that.” Likewise she quotes Natalya Murakhver, who voiced her disgust with political establishment. “I was a very liberal Democrat… Now, my vote is up for grabs to whoever puts kids first.” 

At first blush for those who would like to see the schools reformed, this would seem to be a positive development. But it’s way too soon to start popping the champaign corks.  For one thing, we have to see if any of these insurgent candidates are actually elected. And that assumes they will have the power to do what they claim to want to do.  More importantly, while these candidates are fighting against a particular policy regime, namely masking mandates, the structural underpinning that has allowed the schools to be captured by the teachers unions and other interest groups remains in place.  Third, public schools in large urban areas have been an unmitigated disaster for decades. It is only now that disastrous school policies have started to have a deleterious impact on the kids of affluent parents in the best neighborhoods that they have sat up and begun to take notice.

In her article Weiss maintains that these women really don’t care about political theory; they just care about what works. And therein lies the problem. Their focus is on what they consider to be a series of policy errors and how to correct them without asking why the errors happened to begin with. Those errors were baked in the cake a half century ago when the public schools, under the influence of John Dewey, began to democratize learning. 

No longer was the point of education to teach upcoming generations by instructing them in the Western Canon; what Harold Bloom called the School of Resentment began its long ascent in educational institutions across the country. Eventually, multiculturalism, post-colonialism, ethnic and gender studies and racial essentialism began to dominate curricular development, as it does today. And so today we have the absurdity of specifying pronouns. 

Today’s educational institutions are busy attacking the institutions of liberal society; not sustaining them. But that has been underway for along time. It is only now that affluent parents have begun to take notice, for two reasons. First they can see on their kids’ iPads what they are being taught in Zoom classes. Second, they can see first hand the damage being done to their youngsters by being forced to mask up. 

But the harms visited upon kids in public schools  in poor neighborhoods are an order of magnitude greater. They have been a fiefdom run for the benefit of teachers, not kids, for decades. Look at the results. NAEP statistics show that for 8th graders in America, only 33% are at or above proficiency in mathematics. In reading it is only 35%. The black / white gap in mathematics is stunning. Some 43% of white 8th graders are at or above proficiency, but only 13% of black students are. The only group that scores well is that of Asian and Pacific Islanders. In math and reading, they score at or above proficiency at 59% and 52% respectively.

And that was before the pandemic, with its associated years of learning loss due to closed schools and mask mandates. But there is an alternative: Charter Schools. 

A look at standardized tests tells the story. Recently in New York City 47% of public school students passed standardized reading tests; 43% passed the math tests. But at Success Academy, the Charter Schools run by Eva Moskowitz, the numbers were 91% and 98%. The students at Success Academy are virtually all low income (median income $32,000), selected at random, and 95% are members of minority groups. The political establishment still continues to fight expanding the number of charter schools, even though they produce manifestly better results. 

The upshot of all this is that even if the “Covid Moms” get elected and can effect some policy changes, overall, urban schools are not going to improve. They may improve in some affluent neighborhoods where the parents are well organized. But poor neighborhoods are still going to be left to the tender mercies of the teachers unions. They will not change unless and until public funding for the schools is channeled through parents and not politicians beholden to public sector labor unions. Those are the politicians who owe their elections to the machine politics that are the backbone of the modern Democratic Party.

JFB

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The Republican National Committee has provided the perfect example of why I am no longer a Republican, and haven’t been since summer of 2016. And why it is hard to imagine I ever again will be. 

The New York Times reports that the Republican National Committee (RNC) voted to censure Representatives Liz Cheney and Adam Kinzinger for participating in the Congressional investigation into the January 6 attack on the Capitol. Even worse, the RNC went further and characterized the assault as legitimate political discourse. 

Ronna McDaniel, the RNC chairwoman said this. “They [Cheney and Kinzinger] crossed a line…They chose to join Nancy Pelosi in a Democrat-led persecution of ordinary citizens who engaged in legitimate political discourse that had nothing to do with violence at the Capitol.” 

The resolutions passed by voice vote (typical of cowards) without any noticeable dissent. 

Perhaps Ronna McDaniel and the RNC are insane. Or maybe they really are as dumb as they sound; it is hard to tell, and really not worth the effort. Most likely they are simply lying cowards, cut from the same cloth as their hero, Donald J Trump.  

Ms. Cheney who is running for re-election responded by saying “I do not recognize those in my party who have abandoned the Constitution to embrace Donald Trump. History will be their judge. I will never stop fighting for our constitutional republic. No matter what.”

Good for her. 

Precious few elected Republicans beside the usual suspects like Mitt Romney, Mitch McConnell and Ben Sasse have been willing to stand up and tell the truth. The election wasn’t stolen; Trump inflamed the crowd on January 6 in a desperate attempt to keep himself in power. 

It was a failure. Just like him. 

JFB

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The Washington Football Team, previously known as the Washington Redskins, is changing its name to the Washington Commanders. This earth shaking event follows years of agonizing over what to rename the team so as not to give offense to the delicate sensibilities of professional football fans. 

In keeping with the spirit of finding appropriate names for things, I would like to propose renaming Washington, DC. Instead of being named after our first President, General George Washington, the capital could be renamed Absurdistan, USA  since that moniker would better describe the daily activities that go on here. 

Consider for instance, Georgetown Law School (oops, there’s that George thing again). Some students (I use the word loosely) of the Law school, armed with Twitter, have gone into full social justice warrior mode. They have taken to demanding that the Dean fire Ilya Shapiro, the newly appointed Executive Director and senior lecturer at the Law School’s Center for the Constitution. Shapiro had previously served as vice president and director of the CATO Institute’s Robert A. Levy Center for Constitutional Studies. 

Shapiro’s nominal offense was to fire off an admittedly inartfully composed Tweet to the effect that President Biden should not restrict his search for a new Supreme Court nominee only to black women. But Shapiro’s real offense is that he is a libertarian legal scholar who believes (gasp) that the Constitution means what it says. 

Our progressive friends simply cannot permit that, and so have launched a cancellation effort in order to get Shapiro fired. But we should have pity on the poor little put upon revolutionaries of Georgetown Law. They have been traumatized. So in addition to the summary firing of Shapiro some have demanded a safe space where they can go and have a good cry; another demand is for a personal reparations package for black students to compensate them for missing class so they might go to the protest. 

The Dean, who reportedly agreed to set aside space for the more lachrymose students, ought to consider handing out crayons, chocolate chip cookies and milk cartons to the social justice warriors who have had such a rough couple of days on the battlefront. 

In the meantime in different section of Absurdistan, Senate majority leader Chuck Schumer continues specializing in political malpractice. Knowing full well that he was going to lose, he called a vote on (1) Biden’s badly named Build Back Better Bill and another to (2) effectively end the filibuster. In so doing he forced Senate Democrats in competitive seats to take difficult votes while giving Republicans a freebie. 

That vote could come back to haunt Democrats in the 2022 midterms. Among vulnerable Senate Democrats likely harmed by this bit of theatre are Rev. Ralph Warnock (GA), Maggie Hassan (NH), Catherine Cortez Masto (NV), Mark Kelly (AZ), and Michael Bennet (CO). But it might prevent a New York Democratic Senate primary challenge to Schumer by Alexandria Ocasio-Cortez. Which is the likely reason why Schumer chose the path he did. 

Meanwhile at the other end of Pennsylvania Avenue, Joe Biden, Grand Chief of Absurdistan reminded us that he is busy trying to lower inflation by spending lots more money that the Fed will obligingly print up. In addition he has taken other steps to get prices to fall. For instance oil prices fell to $78 a barrel in late November when the President announced his plan to release 50 million barrels of oil from the U.S. strategic petroleum reserve. 

As of this writing the price of oil is $92 a barrel, about 18% higher than it was when Biden began working on lowering the price. 

For sheer stupidity though, it’s hard to surpass Karen Attiah, the Global Opinions Editor for the Washington Post. Here is a sample Tweet from her:

So white people, you guys need to figure this out how to erase the emotional rewards of sadistic pleasure white people have long enjoyed in dominating and destroying black bodies.

— Karen Attiah (@KarenAttiah) June 17, 2020

But wait—there’s more. In today’s Washington Post, Attiah writes the following on the Whoopi Goldberg affair:

“ABC could have provided a space to educate Goldberg and the rest of its audience about the centuries-old history of global white supremacy, and to push back on current efforts to marginalize the voices of the oppressed.

Instead, it chose one of America’s favorite pastimes — silencing Black women.”

Not even worth commenting on. 

JFB

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