TCS Daily


Tarp the TARP

By Larry Kudlow - November 18, 2008 12:00 AM

Treasury Secretary Henry Paulson has called for a pause in the financing request for the Troubled Assets Relief Program (TARP), halting it at $350 billion. (The original request was for $700 billion.) I think that's an excellent idea. But in a recent hearing of Barney Frank's Financial Services Committee, Democrats went ballistic at the thought of no more TARP money. They want to keep spending. They want to throw money at GM, the other Detroit car makers, plumbers, auto-parts suppliers, homeowners, mortgage problems, and foreclosures. Candy stores all over America now want TARP money.

Meanwhile, Senior Obama advisors are talking about another $600 billion to pull us out of recession. Some reports even suggest the development of a new industrial policy for big-government interference in housing, banking, energy, autos, and more.

But all this brings up a whole new problem in American finance: How are we going to transport and deliver trillions of dollars of new government money? It's not an easy task. We've moved beyond show me the money. This is throw me the money. And shovels alone won't do.

We'll need to convert Caterpillar earth movers into money movers. We'll need new streamlined helicopter fleets to drop money from the sky. We'll need a trucking armada and full use of the railroads. And we'll need an army of smaller trucks and SUVs to reach folks in the off-road areas. And let's not forget FedEx and UPS -- we'll need them to make sure the money arrives on time.

We may even need high-level planners at the Department of Transportation to help coordinate this vexing money-delivery problem. Sending out trillions of dollars may sound great to your average liberal Congress member. But this will not be easy. Perhaps the transitioning Obama administration can designate a Transportation Monetary Tsar. These logistical realities must be dealt with.

Or maybe there's a better idea: Maybe we take Mr. Paulson at his word but go one step further. Let's stop any new TARP money -- period. Enough is enough. The TARP has already done some good. Banks have more capital. Credit spreads in the money markets are narrowing. And there even are signs that business and consumer loans are flowing once again. So let's cap the TARP -- or tarp the TARP.

The new congressional Keynesians believe government can spend us into prosperity. They're wrong. Everything we have learned in the last four decades tells us that governments don't create permanent new jobs or capital investment. In fact, the more we spend, the more we'll have to raise tax rates. And that depresses growth. Europe went down this road and failed. So did Latin America and parts of Asia before they wised up.

And for some reason no one in Washington is talking about cutting tax rates, which would strengthen incentives to work, invest, and take new business risks. We should be making it pay more after tax for entrepreneurial activity of all kinds. How about this: Let's get back on the path of free-market capitalism.

Even at the G-20 meeting in Washington this past weekend, all one heard was "global fiscal stimulus" -- or more spending on a worldwide scale to fight recession. It won't work. It never has. Hundreds of academic studies over the past 25 years show clearly that countries that spend more, grow less; but that nations that tax less, grow more.

Why these lessons have been forgotten is beyond me. We have to restore market discipline and personal accountability. We should reward the economic good, but punish the bad. Instead we have launched a demoralizing government-spending nymphomania.

Incidentally, all this talk of big-government bailouts and a never-ending flow of government spending has disheartened the stock market, which is now down five of the past seven days. Since the November 4 election, the Dow is off 15 percent, or more than 1,400 points.

All this shows why, like the grounds crew at a baseball stadium on a rainy evening, we need to roll out the tarpaulin in order to preserve the field. To safeguard today's economic field, it's time to tarp the TARP. Let's stop right here at $350 billion before everyone in the country demands a piece of the new TARP action. At the same time, let's cut taxes to grow the economy. Slash the corporate tax rate. Reduce personal rates across-the-board. Promote investment with a lower capital-gains tax and a lower estate tax. Let's restore the incentive model of economic growth.

Current political trends in Washington are going to push us off some left-wing economic cliff. Instead, let's have some sanity. It's time for a reality check about what works and what doesn't in fighting recession and promoting long-term economic growth.

I say tarp the TARP.

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57 Comments

Current political trends in Washington are going to push us off some left-wing economic cliff
"The new congressional Keynesians believe government can spend us into prosperity. They're wrong. Everything we have learned in the last four decades tells us that governments don't create permanent new jobs or capital investment."

The Keynesian idiots aren't just in Congress, but also on TCS Daily's forums.

A shot across my bow
I hate to start off with some off-topic remark.. but as you know, I've been away from my desk this past week. And in the interim, you've announced the beginning of some sort of crusade:

"I am not letting you off the hook on this one, Roy. From now on, I will keep bringing it up. Anyone new comes to these forums, I will warn them about you. You are not going to get away with this crap. Not this time."

Very impassioned. And as it announces an intent to commit unspecified future outrages, I didn't think I could let it pass without some attempt to address the irritant responsible for your sulk. Hence, allow me to recommend the following comment:

http://tcsdaily.com/discussionForum.aspx?fldIdTopic=9637&fldIdMsg=96119

I hope these words pour oil on your troubled waters.

For what it's worth, my current view on the bailout is much in line with your own. I've been watching the committee hearings on C-Span, and it has become painfully apparent that what's happening with the infusion of funds is precisely what we didn't want to have happen: the money is being used to reimburse the errant banks for their poor decisions. Meanwhile no attempt is yet being made to address the several million foreclosures either currently in process or yet to come.

This is a state of affairs I'm hoping the new administration will address more productively than did the one that chose Goldman Sachs to direct the bailout.

We're currently falling off the right wing cliff
Sorry to disturb you again.. here's a couple of comments on the workings of your favorite theory, Say's Law:

http://tcsdaily.com/discussionForum.aspx?fldIdTopic=9637&fldIdMsg=95966

Saysian thinking got Detroit where it is today. They thought if they just built those inelegant gas hogs, people would come forever. They were wrong.

But, you still support government intervention.
Even though it has been proven to fail in the past.

Roy...
The main contention you made and vigorously defended earlier this year was the prediction that the Keynesian 'pump priming' stimulus would...(drumroll please) ACTUALLY pump the economy.

It didn't. And that was way before people starting shutting their wallets because of the meltdown later this year.

You are totally ignoring/glossing over that. THAT is what I will keep calling you out on until you ACKNOWLEDGE that. All I am demanding -- passionately or not -- is intellectual honesty on your part.

Now, as for savings. You can actually track it here:

http://www.bloomberg.com/apps/quote?ticker=PIDSDPS%3AIND

I didn't know there was a ticker symbol for it. But Bloomberg has one. There it [PIDSDPS:IND] is.

Now -- AS A SEPARATE ISSUE -- you, Roy have noted issues you have in the methodology of calculating the 'savings rate'. Fair enough. But look at that graph. I don't want you to look at the spike but the corresponding downside. Notice how it neatly syncs with when the stimilus checks started arriving in the mail and when they stopped? And, the activity that the BEA DOES track for this statistic is definitely not consumption spending in nature, even if they don't track everything you, Roy, would like them to track that would be defined as savings (much of what you brought up with I do agree with you, BTW).

Furthermore, the U of Michigan studies involved surveys that had results that sync'd right up with this graph, too.

Obviously, for the most part, people didn't spend that money Roy.

So, they aren't perfect. Fine. But with the huge amounts of money involved, they do track the obvious and UNDENIABLE trend that people socked it away or paid off old consumption (debts). Either way, the economy didn't get PUMPED.

And THAT is why Keynes was wrong. Because, it never does get pumped when you send out the checks of money that people didn't 'earn'. Didn't work in 2001. Didn't work even in the Great Depression -- not sustainably, anyway. And in the GD, we at least got THINGS for the government spending -- like public works. The Chinese are following in those footsteps to build a nice, modern national train system for their stimulus package they just approved. But even the 'stimulus money for public works' takes quite a while to get things going. In this country, the environmentalists will hold up in court for a decade any major public works projects we do.

No Subject
"Saysian thinking got Detroit where it is today. They thought if they just built those inelegant gas hogs, people would come forever. They were wrong."

How so? Says never advocated crappy management as far as I can tell. He certainly didn't advocate that it should be excuses. Had been alive later on, he would no doubt take Schumpeter's take on the subject.

You don't understand Say's Law if you can't make the distinction between microecnomics and macro.

Because the Media covers his butt
Zogby is in trouble because it actually had the gall to survey Obama voters to see what they actually KNOW.

"UTICA, New York -- Just 2% of voters who supported Barack Obama on Election Day obtained perfect or near-perfect scores on a post election test which gauged their knowledge of statements and scandals associated with the presidential tickets during the campaign, a new Zogby International telephone poll shows."

http://www.zogby.com/news/ReadNews.cfm?ID=1642

The failure of the market
You are such an idiot, marjon. You'll never get that the ideological approach doesn't work.

No, I don't support government intervention on principle. Nor do I support nonintervention on principle. I support finding solutions that have the best chance of working.

This bailout has turned out to be a scam job. First Paulson wanted total control over who was to get all the money, and how, but Congress balked. And they spent a week being rushed to complete a package defining the strings to be employed-- without which, no plan would have a chance of working.

Then Paulson disregarded everything, and just gave $150 billio (now $250 billion) to his friends.. sans strings. Despite all the rush, they just put it in their pockets, for use at some later rainy day.

That kind of bailout is a waste. And it rewards bad behavior with benefits. It's the least free market intervention that could have been designed.

While this is a fine example of an intervention that was DESIGNED to fail, it does not at all form a proof that NO intervention can succeed.

And in fact, the fact that we are in this pickle in the first place is the best possible proof that nonintervention in the financial markets is an approach that has totally failed.

A bad idea....
I don't know why the liberal illuminati feel throwing money at these companies will help anything. It will just give them more money to spend, and then they'll be back for more.

Free markets ARE the best solution.
Evidence is everywhere that government intervention guarantees an uworkable solution.

Who knows?
But Robin Hood Economics always appeals to the masses. A free chicken in every pot and all that.

Proposing a better fix
I think I've said this again and again.. the comment I recall making some months back was that people would spend a portion of their stimulus checks and pay down debt with the remainder. Until you find some of my own words to the contrary, I'll go with that.

I was in error thinking much of it would be spent. In fact there was no increase in consumer purchases during that period (second to third quarter, 2008). But I think this can be explained adequately by noting the enormous, and increasing, overhang in personal debt most American families have been accruing in recent years. In fact, if you'll recall, it was in 2005 that we passed the milestone of having a net zero personal savings rate.

It seems the debt-ridden public did the prudent thing, electing to pay down debt first instead of continuing along their treadmill to oblivion.

Two further comments. First, to your thinking that this fact constitutes some sort of proof of your thesis, i.e.:

"..the economy didn't get PUMPED. And THAT is why Keynes was wrong. Because, it never does get pumped when you send out the checks of money that people didn't 'earn'. Didn't work in 2001. Didn't work even in the Great Depression -- not sustainably, anyway."

So there is "never" any instance where someone gets found money-- or is given a loan from the IRS-- and does anything but sock it all away? Why not try this experiment? Find some ordinary individual and give him a thousand bucks. Then ask him a month later whether he spent any of it on new purchases. The notion that he will never in any instance do so, and in fact is prohibited by some inflexible law of economics, is a stupid one. It indicates an obstinate approach to the issue.

Were our personal debt levels any lower, common sense suggests more of the money would have been spent on new purchases. What I did, in fact, was to put it away (add to savings) in order to have more to spend this December on charitable deductions. So the money was both saved and spent. And in doing so I fit neatly onto the chart.

2. In any event, according to your thesis, money spent toward paying down old debt-- and for that matter money put into the money market or a CD-- does no useful work.

But doesn't such a stand fly in the face of your own philosophy, which says money is better placed in the hands of the banking interests and investing class than it is in the hands of mere consumers? This money does the work of providing assets that reinforce the stability of those banks in which it is placed. Or, alternately, it gets re-lent, propelling the economy to greater heights of speculation and generally heating things up.

Isn't that supposed to be a good thing? And doesn't money placed in those ways in fact also stimulate the economy?

However, in closing, it is important to you that I acknowledge error. And I do admit I thought people would be spending more of it than they did. Hence the stimulus did not perform as intended.

What I take from that is that the economy was already beyond easy help by the start of summer. It is certainly much further from containment at the present time. So yet another stimulus would be poorly conceived. That is, unless the funds were targeted as unemployment benefits.

I would suggest this (and again, maybe you could clip this note so we can refer to it later). You mention that we get a much better bang for the buck when we spend money on wages, such as for government public works, than we might for an outright gift. And I would heartily concur.

First, we do have a worn out infrastructure in many respects. Highway maintenance and bridge repair are underfunded and falling further behind. Worse, there is much remediation to be done in the nation's hazmat sites now that the Superfund is moribund. There are any number of topics where money could be constructively spent on wages, and low wages furthermore.

This notion coincides with great need. We're expecting a minimum of two million freshly unemployed (if we haven't reached that mark yet) and we have no idea how many more to come. These people can't contribute in any way to the economy until they get rehired.. in fact they constitute a negative drag on social services. They could return to filling productive roles by manning the shovels.

Federal money spent in this manner would reduce the requirement for emergency assistance at a federal and local level. The wages would also radiate through the economy, creating fresh taxable moments at any point where an additional transaction occurred. Thus a generous portion of the fresh funds moving across the economy would be returning to the US Treasury reliably, several times each year.

All that would be required to keep this infusion money supply neutral would be a pledge to retire the funds once the work was done and we were returning to normal. And the means of doing this would be to return to the fiscal policies of the late 1990s by paying down federal debt.

Would we at least be in agreement on that?

You talk theory...I a cite REALITY
" Find some ordinary individual and give him a thousand bucks. Then ask him a month later whether he spent any of it on new purchases. The notion that he will never in any instance do so, and in fact is prohibited by some inflexible law of economics, is a stupid one. It indicates an obstinate approach to the issue."

Sorry, but theoretical guesses don't matter. What matters is what said person ACTUALLY does and thus determining what he'll likely do in the future. THAT is what the data from the consumer surveys and savings statistics does...it provides actual historical data that gives credibility to those who say, "See...this stimulus nonsense won't work as you intend it to."

Sure...people who get found money who didn't earn it and don't need it can pay for a new flat screen HDTV. But not if they feel financially insecure at that time. In other words, during good times they would consume that way, Roy. But what would be the point in needing to 'stimulate the economy' during good times?

And I never said 'never' with regards to individuals. The data doesn't support that either. But it does support the overwhelming majority of what those individuals do. That is what is important in torpedoing the whole 'pump priming' nonsense.

"your own philosophy, which says money is better placed in the hands of the banking interests and investing class than it is in the hands of mere consumers"

I never said that it is placed in the hands of the 'banking interests'. As for the 'investing class', everyone who invests is an investor. And since investment is what propels future economic growth -- and that includes non-financial investments like 'sweat equity' -- then that is what should be encouraged, not taking money from Taxpayer Peter so Paul the Lucky gets a windfall to pay his bills with.
The ONLY silver lining is the portion that got put in to savings. But that won't 'pump prime' the economy in the immediate time period, either.

"Isn't that supposed to be a good thing? And doesn't money placed in those ways in fact also stimulate the economy?"

That isn't what YOU claimed would happen. YOU claimed that it would get spent on consumption and then businesses will see the increase in sales and say, "Gee! People are buying more of our crap! Let's expand!" when in fact that never occurs because instead they say, "Gee! That one shot in the arm the government gave them MIGHT increase sales for one month or so but no way can we count on that going on into even the next quarter after that so...we'll grant overtime authorization for some of our workers for now...if it even becomes necessary."

Investment/Saving is not consumption. It sure is nice that you finally see the light now, but you sure as hell didn't then according to the way you are talking about it now.

"And the means of doing this would be to return to the fiscal policies of the late 1990s by paying down federal debt."

The federal government's debt can be ZERO, aliens can show up and give us the cure for cancer and global warming and replicators that produce anything for us but that doesn't return things to normal. Obama's coming war against investors (FDR's Business Holocaust II) will ensure that.

And he won't return to those policies anyway. Not unless a Republican Congress is elected to force him to, such as the case when Clinton 'got religion' on balancing the budget. From 1992-1994, Clinton and the Dem Congress didn't give a damn about balancing the budget in actuality. They sure loved raising taxes though and the economy did not boom until after the Republicans forced Clinton to cut the capital gains tax in 1998.

so, I am afraid we can't be much in agreement on this point since your version of history is skewed from reality.

Nonintervention? Say What?
>the fact that we are in this pickle in the first place is the best possible proof that nonintervention in the financial markets is an approach that has totally failed.

Poppycock! Balderdash! Drivel and Swill!

It was government intervention that created this "pickle". If government guarantees on loans are not government intervention, then I don't know what is.

It's very simple. 1) The government guarantees loans (promises to pay them back if the lender defaults) for low income homebuyers. 2) Would-be homeowners jump at the chance to buy a home that they could not afford to buy before. Of course, they cannot afford to buy it now either, but now the bank is willing to lend them the money, because the banks know that if the lender defaults, the government guarantees to pay back the loan. Note: both the lender and the borrower are reacting logically to the changes introduced by the government intervention into the market. The government has intentionally “stimulated” the housing market by increasing the supply of money available for house purchases. 3) The increase in the number of potential home buyers causes a high demand for houses – increased demand. 4) High demand for houses causes high house prices – normal, proper market response. 5) High home prices create a construction boom, as the housing industry adjusts to meet the increased demand – exactly how a free market economy should react. 6) The economy booms, as the housing industry reacts to and increase in demand, in what appears to be (from an economic signals perspective) a rapidly growing population, and a high need for new houses. 7) Reality kicks in. There was no rapidly growing population, and those low-income, high-risk homebuyers turn out to actually be (surprise!) low-income and high risk. They start foreclosing on those homes they could not afford. 8) Banks capitalize on the government guarantees, but are left holding lots of foreclosed houses. 9) A surplus of empty houses (built to meet an artificial, temporary, government stimulated “demand”) creates excess supply. 10) Excess supply drives house prices down....

We all know the rest. Things get ugly. But the interesting thing is that very same people who instigated the government intervention, the stimulation which caused the market to react, now claim that the market has “failed”. Are they stupid, or dishonest?

What is the initial cause in this long chain of cause and effect? Look again back at the first link. First, the government guarantees loans for low income homebuyers. Ask yourself this simple question: Why would the government do such a thing? Good questions. The answer is simple. It happened because the reigns of government were given to social engineers. Those who think that government is a good tool for doing good works were allowed to drive the boat. It was a social engineering project, engineered by liberal ideologues with big hearts and big dreams, but little brains, little respect for free-market economics, and little respect for the fact that reality ALWAYS trumps ideology.

Motivated by liberal ideology, they wanted to create a new world where the American Dream of home ownership was within the grasp of every citizen. It is a noble goal. One which warms the heart of both liberals and conservatives. But it is not a dream that you can realize by ignoring basic economic realities. You cannot create wealth (houses) via legislative fiat. Builders have to build those houses. And the builders have to be paid. Somebody is going to have pay for those houses, and that somebody ought to be the new occupants. If they cannot afford to pay the workers, they should not be living in the houses. This is how it works, how it always has worked, and how it is supposed work. This is how it was working before government loan guarantees. Those who could afford to buy homes did, and those who could not afford to buy houses didn’t.

But then the social engineers got into positions of power, and they tried to use the government to short-circuit this basic truth. They tried to stimulate more home ownership by tipping the scales in favor of borrowers who could not really afford to buy homes. It was THIS government intervention that got us in this pickle.

If these big-hearted idiots had a proper respect for the maximizing effects of a free market, they might have realized that tweaking the system to stimulate temporary artificial growth was a bad idea. But they are very slow learners. And if we allow them to continue to benefit from their mistakes, and to shift the blame to “nonintervention”, so as to cover their errors, they may never learn. And we will continue to suffer.

Thank you. Very well put. But as a saying in my native tongue describes it, it's like
blowing the conch before a deaf man, as far as your target audience is concerned.

Evangelical libertarians needed.
If libertarians want the government to leave them alone, they need to be more vocal at the grass roots level with friends, family, etc. and educated everyone why free markets and limited government is so important.

One great book "Whatever happened to Penny Candy". http://www.mises.org/store/Whatever-Happened-to-Penny-Candy-with-Study-Guide-P303.aspx

Also Bastiat's The Law is easy and free on-line.

Handing out Cato's Constitution may help as well.

Should the government then do nothing at all?
Your arguments are becoming more and more circular in nature. Let's get back to the main issues.

First, money is best employed as a medium of circulation. The more it circulates, it nourishes more hands and increases buying power. Plus, there are more taxable moments.. so more of it returns to the government. This makes it easier for us to (a) balance the budget and (b) purchase more in the way of needed services.

All that equals good. True, money can circulate TOO quickly. But that is not our current concern.

So the notion that we should do what we can to encourage fresh circulation is, I think, valid. The stimulus did not do so as much as we would like.. apparently most of the money went into savings/ investment instead. And with so much money tied up in savings/ investment already, it did no worthwhile work there.

Nor, might I mention, did Paulson's gambit work any better. He just gave $250 billion to the major banks without strings attached. And what they did also was to just sock it away for a rainy day.

So neither plan worked. And to judge from the full spectrum climate of opinion as of this weekend, everyone in the country who has been following the opera-- right, left and center-- is waiting for someone to come up with a better plan.

None that I know of are hoping any billions will just get thrown at the Big Three auto makers, as you seem to believe. There's hardly anyone in the country who reveres these people's judgment.. and demonstrably, when they get to follow their own leads they hemorrhage cash at alarming rates.

A first rate way to keep things from getting worse would be to ext3end unemployment benefits. And the reason there is to keep underconsumption from getting any worse. Once several million families lose their incomes, they lose their homes. And these empty homes sit there depressing the housing market. Equity continues to plummet for the rest of us. And the newly homeless can no longer afford to make even the most modest of consumer purchases, so more stores go out of business and more householders get paid off.

That's what a Depression is. It's no longer a "recession" because none of the fixes for an ordinary recesion are working in this one.

So we do need to do something. We can't just do nothing. And everything that's been tried so far has failed. If you have any bright ideas I'll be very pleased to consider them.

My comment, which you misconstrued, about paying down federal debt, went to the Misian argument.. that the fixes being proposed were all inflationary in their effect. What I said was that any injection of cash borrowed from the future could pay itself off so that a net zero impact on the budget would result, if we just first inject the funds and then, once the normal momentum of circulation had returned, pay down the resulting increase in the federal debt.

That way there would be no net increase in the money supply. Do you not agree with that?

This has nothing to do with the money supply
...and please stay on topic. You're going totally off on some tangent because you don't want to admit to the inconvenient facts of the matter under discussion.

Why not?
It literally means bringer of good news.

And it is come to mean someone who is enthusiastic.

It is a great way for libertarians to learn to 'tolerate' people of faith.

How can faith be imposed?
Libertarians need to learn to respect free speech and to teach social conservatives that using the force of government to impose morality fails. Cal Thomas had a nice piece about this a few days ago.
People of faith have the right to try and persuade you just as you have the right not to listen. Neither have the right to use the force of the state to limit each other's rights.

If libertarians who don't have faith are so secure in that belief why should people of faith be a threat?

A worthwhile works program
Which facts do I not want to admit? Your contention is that an economic stimulus CAN NOT ever work, because of some mysterious law of economics. And I'm saying that's a lot of crap. The one we had this spring did not work as intended. But that is hardly the same thing.

It's obvious that the more narrowly a stimulus is focused, on people who are actually short of cash, the more successful it will be. And the stimulus we had was given out equally to everyone in the country-- most of whom were not then short of cash.

At the moment we have an opportunity to inject some funds into a project that would do double work. We have a confluence of needs, with the advent of two million or so newly unemployed workers who will need funds to avoid another round of foreclosures.. and the decaying plumbing infrastructure in America's cities.

The distribution mains and feeders for our older cities were installed a century ago, and had a design life of about 75 years. Hardly any of these original pipes have been replaced, other than just sections that have already burst. And the cost of such necessary work is far beyond the reach of the municipalities.

We could of course just abandon the cities as their water supplies become totally unusable. But a better approach would be to inject federal funds by creating low-cost loans, and initiating a massive replacement program.

The scale of the problem: $277 billion, according to the EPA. Such a program would create emergency work for the next year or two, or until the general economy got back on its feet and better jobs began to appear.

This money would be targeted very precisely to people who wanted to work but had no work. And it would also renew our cities. Instead, we're just now in the act of giving Citigroup guarantees to cover $306 billion in assets that are very likely near worthless.

I ask you: which approach is better for the people of the United States? Or does the welfare of the people not count?

Staying on topic
This was your original topic:

"The new congressional Keynesians believe government can spend us into prosperity. They're wrong. Everything we have learned in the last four decades tells us that governments don't create permanent new jobs or capital investment."

The most serious aspect of the problem before us is the imminent threat of deflation. And there's just no way to correct for this without doing something to increase consumption. I assume you're okay with the laws of supply and demand?

Tell me some alternate ways of putting money into people's pockets, other than through the invention of new federal funds. And if you choose inventing new federal funds, tell me what we should do once the crisis has passed.. other than to retire our freshly accrued federal debt.

Or is none of this needed? Should we stay pure.. and just let the slump wipe out an additional five million jobs? Or ten million? Is that just nature's way?

This is like a forest fire. If we just let it spread there's no telling where it will take us. We've quickly gone from four point something to 7% unemployment. Should we just sit on our thumbs while it goes to twelve? Or beyond?

Maybe the government shouldn't be creating permanent jobs.. or capital investment. But it should be doing something useful. And it certainly is in a good position to do something useful. It can build a bridge, so we can get across this chasm.

Then doom libertarians to the fringes.
If you who think you are libertarian can't work with people of faith who share many of your libertarian values of limited government, then you deserve to stay on the fringe.

"A Libertarian Defense of Social Conservatism"
"The most obvious point to me is that it is the do-gooding liberals who are telling us all what we can and can't do. The religious right usually just wants to be left alone, either to home school, pray in public or not get their children vaccinated with who-knows-what. Inasmuch as the "religious right" wants some things outlawed, they have failed miserably for at least the last 50 years. Abortion, sodomy, and pornography are now all Constitutional rights. However, praying in public school is outlawed, based on that same Constitution.

Just think for a moment about the things you are actually forced to do or are prevented from doing. Seat belts. Motorcycle helmets. Bicycle helmets. Smoking. Gun purchase and ownership restrictions. Mandatory vaccines for your children. Car emissions inspections. Campaign ad and contribution restrictions. Saying a prayer at a public school graduation or football game. Trash separation and recycling. Keeping the money you earned. Gas tax. Telephone tax. Income tax. FICA withholding. Fill in this form. Provide ID.

For the most part, the list just cited is post-1960. Neither Pat Robertson nor James Dobson ever forced any of that on us."

"When the day comes that the only thing between me and liberty are some Bible-quoting know-it-alls, I'll reconsider. But right now, there are a lot of things between me and liberty, and the "religious right" is not one of them. In fact, I see them voting for more liberty, not less. If the Republican Party ever decides it really wants to be the party of liberty, rather than the slower-road-to-socialism party, I'll gladly join the religious right there."

http://www.americanthinker.com/2008/11/a_libertarian_defense_of_socia.html

Sure they do.
But if you want those believers to vote with you to limit the power of the state it may not be wise to insult them.
As a matter of fact, it may be useful to show them some respect and encourage them to understand that faith cannot be forced. Imposing religion via the state will not build a strong body of faithful.

Randian irrationality
While I agree with much of what Ayn Rand had to say, I think she lost her objectivity when it came to religion. She demonstrates so much intolerance and arrogance in ruthless condemnation of people of faith. Her condemnation of Frank Boreman quoting from the Bible as he orbited the moon in Apollo 8 was over the top. Those who risk their lives like Boreman and survive understand that 'but for the grace of God go I'.
Major organized religions are not much better than the government we all critique, except, now, it is a voluntary organization.
Faith in God does not require one belong to 'a club' like the Catholics or Lutherans. All one needs is faith.
Faith, positive mental attitude, hope, etc. may be irrational and not objective but to disregard and trivialize their power is an arrogant mistake.

Disagree with these?
"- The government's primary responsibility is to promote the common good, that is, to maintain the rule of law, and to preserve basic duties and rights. The government's role is not to usurp free actions, but to minimize those conflicts that may arise when the free actions of persons and social institutions result in competing interests. The state should exercise this responsibility according to the principle of subsidiarity. This principle has two components. First, jurisdictionally broader institutions must refrain from usurping the proper functions that should be performed by the person and institutions more immediate to him. Second, jurisdictionally broader institutions should assist individual persons and institutions more immediate to the person only when the latter cannot fulfill their proper functions."

"- Liberty, in a positive sense, is achieved by fulfilling one's nature as a person by freely choosing to do what one ought. Economic liberty is a species of liberty so-stated. As such, the bearer of economic liberty not only has certain rights, but also duties. An economically free person, for example, must be free to enter the market voluntarily. Hence, those who have the power to interfere with the market are duty-bound to remove any artificial barrier to entry in the market, and also to protect private and shared property rights. But the economically free person will also bear the duty to others to participate in the market as a moral agent and in accordance with moral goods. Therefore, the law must guarantee private property rights and voluntary exchange."

Who has the numbers?
First, who/what is a 'neo' con?

What is the difference between a new conservative and an old conservative?

People throw words about without definition. Many who I have heard called 'neo con' want limited government.

What is a 'neo con' to you?

In any event, there are probably more of them than there are those who call themselves libertarian.

Libertarians have been defeated more often than 'neo cons'.

I stopped listening to Paul...
when he promoted irresponsible acts.

Winning is an exit strategy.
There is only one way to end a conflict, defeat the enemy's will to fight.
That may be accomplished by propaganda as was done by the left in the USA in the 70s or by totally destroying the country as was done with Germany and Japan.
Paul wanted to leave Iraq before it was stable opening the door to more instability.
A responsible position for him to take would have been to use all forces necessary to leave Iraq stable and capable of defending itself and to keep non-state actors from establishing a base of operations as was done in Afghanistan.

Paul is an MD. Would he support walking away from a surgery half way through?

After completing the operation in Iraq and Afghanistan, he could then begin the process of pulling all US Forces out of Europe and Asia and let the ROW defend itself.

Do you support attacking the Somali pirates?
Or should we pay their 'tax'?

What is wrong with winning as a plan?
If you don't plan to succeed then why bother to plan or execute the plan (strategy)?

As a side, the military always has plans for everything, so the military has a plan to bug out when ordered.

You don't mind if your oil costs rise ...
or if the other shipping costs rise?

BTW, do you know why there are few US flagged ships? Government regulations.

Is this 'neo-con' or responsible?
"he United States is not the world's policeman; nor does it want to be. We have no right to force others to believe as we believe. But I hope I am not alone in believing that freedom and democracy are superior to such dark alternatives as oppression and tyranny.

The fact is that, like it or not, for the moment, there isn't any better deal out there--as we say in the States--for promoting global stability based on our transatlantic shared values of democracy and human rights than the United States of America. While many may wish for the demise of American military power, I'll warn you one more time: Be careful what you wish for. I promise you, you'll miss it when it's gone."

http://www.heritage.org/Research/NationalSecurity/hl1102.cfm

What is OCD?
If you and other libertarians persist in your fantasy world, you will never succeed in promoting any of your agenda.

Responsible people who want to govern have to understand that if the good guys are not the toughest SOB in the valley, then you may not like what happens to you.

Libertarians just like to whine and moan and let others be responsible?

4th grade
In 4th grade we boys played kickball. A few girls wanted to play as well. We agreed as long as they didn't cry to the teacher if they got hurt.

Of course one girl was hurt and I was yelled at by the teacher.

If women want equal treatment they shouldn't cry to the teacher or storm off in a huff when they can't respond.

What is OCD?
You didn't tell me.

If you want to persuade more to libertarian ideas then I suggest libertarians need to prioritize the message and encourage those who agree with the top priorities to work together.

If you continue to be intolerant of religious conservatives and those who support a strong national defense, you will keep being 'loosertarians'. But you can 'feel' good about yourself because you made no compromise.

Opportunity: pro-life atheists
"Just as pro-life Christians argue that life is sacred because it's given by God, pro-life atheists insist that human life is intrinsically valuable without God's help. "I think there is nothing beyond this life—but life in and of itself is unique and special," explains Matt Wallace, a UPS package handler in North Carolina who started an online group for pro-life atheists in 1999. "In abortion, a human being ends up getting killed for no other reason than he or she wasn't planned or wanted. One should always err on the side of innocent human life." Wallace is likely one of the very few atheists who voted against Barack Obama, largely because of his abortion views."

http://www.newsweek.com/id/171240

Hope springs eternal.

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