Monday, November 30, 2009

The Cost of War

Here is a quick video explaining how the wars in Iraq and Afghanistan are going to cost $3 trillion dollars. One is of course, required to ask the questions, "Was it worth the cost? Could it ever be worth the cost?"

The obvious answer is, "Of course not." Yet we're increasing the bet by increasing our presence in Afghanistan. We should not be surprised that the same government that can't operate the Post Office has difficulty managing two other countries besides its own.



HT: Mish

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Wednesday, November 25, 2009

The Glory of War

I'm nearly finished with We Who Dared Say No To War. I just read Lew Rockwell's essay "The Glories of War." You may read it online here.

Here is a brief excerpt:

"War is the devil's sacrament. It promises to bind us not with God but with the nation state. It grants not life but death. It provides not liberty but slavery. It lives not on truth but on lies, and these lies are themselves said to be worthy of defense. It exalts evil and puts down the good. It is promiscuous in encouraging an orgy of sin, not self-restraint and thought. It is irrational and bloody and vicious and appalling. And it claims to be the highest achievement of man.

It is worse than mass insanity. It is mass wallowing in evil."


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Politics and the Christian

Here's another brilliant piece by Doug Wilson on politics.

Read it.

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Monday, November 23, 2009

Globate Climate Change Fraud

The University of East Anglia's Climatic Research Unit was recently hacked and data has leaked onto the internet demonstrating intentional data manipulation to demonstrate the validity of global climate change. Mish and The Market Ticker have done some good summary work on the topic.

This should come as no surprise, as many were already anticipating this type of fraud, but what is so amazing to me, is the collaborative effort by so many to defraud the world.

Read Mish's take on the hacked data and further musings of his here. Also read Market Ticker on it.

Mish linked to this video interview of Tim Bell, a climate change skeptic, who anticipated this kind of fraud.



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Friday, November 20, 2009

One of My Patented Rants

This was originally an email, and I've revised it slightly to fit the context of a blog entry. I decided this might be a benefit to others beyond the intended recipient. I invite criticism and questions on it.
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I have been a skeptic of the organic food movement for as long as I've been aware of it, and am only now recently beginning to understand the dramatic shift that our food system has undergone in the past fifty years. My thinking on these matters is still not wholly formed, as I have not come to solid conclusions on many things yet.

But, what I am beginning to learn, that what may look crazy by the majority of people, may in fact be completely sane. Not only that, but it may also be likely that the 'sane majority' may actually be the crazy ones. I mean this quite honestly, I'm not just being cute. The older I get, the more I read, and the more I observe reality, the more apparent it becomes that what most people accept as the real world is really a construct of how those in power wish things to be. I'll grant you that this sounds conspiratorial and perhaps a bit looney, but hear me out.

Think about how companies try to get your money--our money. Think about something as simple as a cake mix. Betty Crocker wants you to buy their cake mix rather than buy flour, sugar, and whatever else separately to make a homemade cake. Stouffer's and countless other companies want you to buy prepared frozen meals rather than make your own meals. I'm not even merely picking on just food companies here. Ours is a consumerist culture where value is only derived and the GDP only goes up when money changes hands--particularly when it is recorded for tax purposes. Wall Street and Washington want America and the world to perceive the American economy as strong and robust. To accomplish this, money must be spent and recorded to be included in statistics that in turn will generate confidence in the stock market and thereby the economy as a whole.

I talked to one of my aunt's a while ago about how her family lived prior to the '60s. It is an interesting story to hear. For the longest time family farmer's like my dad's family lived by and large without cash and without municipal trash service. Family's were self-sufficient, and could barter for those things they couldn't provide for themselves. They bought few things with actual money--something that began to change in the '60s. What changed? I'm not entirely sure, but clearly the consumerist culture began to accelerate and make it increasingly difficult for families to live without money.

Society no longer rewards self-sufficiency, it in fact punishes it quite severely. Taxes and regulations continue to push it to the margins of our society because such people bring little value to what society desires--money, wealth, GDP, stock markets, and most importantly taxes. They do not serve the interests of major corporations. They have rejected the industrial and consumerist culture that wants all farms to use huge expensive machinery, that cages animals in inhumane conditions feeding them food that would kill them without antibiotic intervention.

Better health is a byproduct of the world view shift, but it is not the sole reason I've begun to push for change. This is a matter of a spiritual mandate for good stewardship of the earth, its resources, and those resources under my influence.

I believe it is immoral what the industrial farming models are doing to our land, our animals, and our bodies. I believe it is immoral that our government works in collusion with industrial agricultural companies to eliminate small farmers who take stewardship seriously and are working to provide an alternative food system. I believe it is immoral that chickens are kept in cages so crowded that they cannot sit, that their beaks are clipped so it is easier to eat corn mash, that they wallow in their own feces, that they must walk over their dead until they decompose and fall through the caged floor. I believe it is immoral that cows are fed a diet of chicken manure, cow fat, and corn--all which would kill them were vets not kept on staff with antibiotics. I believe it is immoral for pigs to be kept in small cages where they are unable to nurse from their mother and as a result would bite off the tail of the pig in front of them were the tail not cut off at birth to eliminate the issue altogether. I believe it is immoral for farmer's to not rotate their crops and give their field a rest. I believe it is immoral for farmers to so over fertilize their land that it runs off into our streams and rivers polluting them and killing animals and vegetation in its wake. I believe it is immoral for animal feedlots to turn manure into a pollutant rather than compost it and use it as fertilizer. I could probably go on and on given the time and the inclination.

I feel as though blinders have been removed from my eyes and I am only beginning to see the true state of affairs in this world. We let ourselves become blinded to that which we do not want to see. We want comfort, we want ease. We want cheap food, we want to amuse ourselves with things other than the matters of life.

I recently read a book by Wendell Berry called The Unsettling of America which I would suggest reading. It is a remarkable book with insights that few raise and even fewer contemplate. The industrialization of our nation has not been the blessing that most would have you think. Our once agrarian society was marked by community--an interconnectedness that is foreign to most Americans--particularly urban and suburban America. Husbands and wives would work together, in tandem where they lived and with their children. Industrialization fractured this once connected system. Husbands and fathers left the home for most of the day, leaving all domestic matters to the wife and mother. Children became the domain of women alone, surely leading to the feminization of men. Women became justifiably dissatisfied with their seemingly subservient and isolated role. And men became disenchanted with meaningless and unfulfilling drudgery either at the factory or the office.

I'm not yet sure what to do with this argument, as it is difficult for me to refute it. But I definitely sympathize and would like to mend it somehow. I know it wasn't a utopia before, and I don't mean to imply that it was. But life was at least whole. Families were together and wholesome food was the norm, not the exception.

Most people have lost the sense of what real life is. Real life is family working together, preparing food together, eating together, and playing together. There is no shame in any of those things, nor should one be valued over the other. There is a connectedness between all of them. If one is stressed over the other something will be lost.

We moderns want the pleasure without the work. We want the food without the preparation (and cleanup). We should not be surprised that life become dysfunctional when we neglect the work or preparation.

These are the things going through my mind right now, and you're welcome to think about them too. They are important issues that should not be easily dismissed. Don't let your biases dismiss them. Think critically and logically about them. I dismissed them for too long myself and am only beginning to open my mind to these truths. Just because our society tells you something is true, and you want to believe it is true, doesn't mean it is true. Think about how truth was abused and isolated with the Israelites. There was a mere remnant that knew and believed the truth. Think how few are Christians. Truth is not welcome to most. It should not surprise us that truth is hard to find and hard to hold fast to. Think on how the prophets were abused and rejected. Think how Jesus himself was abused and rejected. When you realize these things, you will begin to realize that much of what you believe is false--not merely about food, but about life.

I don't expect, plan, or care to force anyone to believe or do these things I say. The whole problem is that the force of society and government has been brought to bear upon truth to diminish its power. I want to see a fair fight. I want those opposed to these ideas to deal with them with intellectual and spiritual integrity.

I have decided to no longer uncritically accept things as they are. I will no longer compromise principle in favor of expediency. If there is a viable alternative to that opposed to truth and righteousness, I will endeavor to pursue it. I recognize the road will be difficult and will likely result in mocking, but this is the call of the Christian, is it not?

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We Who Dared Say No To War

I just started reading We Who Dared Say No To War, a book of American anti-war writings from 1812 to the present. The book is edited by Tom Woods and Murray Polner. I am enjoying it and have already been very impressed by two particular speeches. The first was by Alexander Campbell, in his "Address on War," given in 1848 in relation to the Mexican-American War, in which the United States gained control of disputed territory in Texas, California, and New Mexico.

The whole speech is excellent, and may be read online. Here is the thrust of his argument:

"(1) The right to take away the life of the murderer does not of itself warrant war, inasmuch as in that case none but the guilty suffer, whereas in war the innocent suffer not only with, but often without, the guilty. The guilty generally make war and the innocent suffer from its consequences.

(2) The right given to the Jews to wage war is not vouchsafed to any other nation, for they were under a theocracy, and were God's sheriff to punish nations; consequently no Christian can argue from the wars of the Jews in justification or in extenuation of the wars of Christendom. The Jews had a Divine precept and authority; no existing nation can produce such a warrant.

(3) The prophecies clearly indicate that the Messiah himself would be "the Prince of Peace," and that under his reign "wars should cease" and "nations study it no more."

(4) The gospel, as first announced by the angels, is a message which results in producing "peace on earth and good will among men."

(5) The precepts of Christianity positively inhibit war - by showing that "wars and fightings come from men's lusts" and evil passions, and by commanding Christians to "follow peace with all men."

(6) The beatitudes of Christ are not pronounced on patriots, heroes, and conquerors but on peacemakers, on whom is conferred the highest rank and title in the universe: "Blessed are the peacemakers, for they shall be called the sons of God."

(7) The folly of war is manifest in the following particulars: First. It can never be the criterion of justice of a proof of right. Second. It can never be a satisfactory end of the controversy. Third. Peace is always the result of negotiation, and treaties are its guaranty and pledge.

(8) The wickedness of war is demonstrated in the following particulars:

First. Those who are engaged in killing their brethren, for the most part, have no personal cause of provocation whatever.

Second. They seldom, or never, comprehend the right or the wrong of the war. They, therefore, act without the approbation of conscience.

Third. In all wars the innocent are punished with the guilty.

Fourth. They constrain the soldier to do for the state that which, were he to do it for himself, would, by the law of the state, involve forfeiture of his life.

Fifth. They are the pioneers of all other evils to society, both moral and physical. In the language of Lord Brougham, "Peace, peace, peace! I abominate war as un-Christian. I hold it the greatest of human curses. I deem it to include all others - violence, blood, rapine, fraud, everything that can deform the character, alter the nature, and debase the name of man." Or with Joseph Bonaparte, "War is but organized barbarism - an inheritance of the savage state," With Franklin I, therefore, conclude, "There never was a good war, or a bad peace."

No wonder, then, that for two or three centuries after Christ all Christians refused to bear arms. So depose Justin Martyr, Tatian, Clement of Alexandria, Tertullian, Origen, and so forth.

In addition to all these considerations, I further say, were I not a Christian, as a political economist even, I would plead this cause. Apart from the mere claims of humanity, I would urge it on the ground of sound national policy."

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The Limits of Power - Review Part II

In Part I of my review of Andrew Bacevich's book The Limits of Power: The End of American Exceptionalism, I wrote, "America has become a profligate, self-serving nation, bent on bringing its power to bear upon those that will not serve its interests or appetites."

Bacevich continues his criticism of American foreign policy by arguing against the myopic morality tales often cited to cast American military power in its best light. He writes:

"From time to time, although not nearly as frequently as we like to imagine, some of the world's unfortunates managed as a consequence to escape from bondage. The Civil War did, for instance, produce emancipation. Yet to explain the conflagration of 1861-1865 as a response to the plight of enslaved African Americans is to engage at best in an immense oversimplification. Near the end of World War II, GIs did liberate the surviving inmates of Nazi death camps. Yet for those who directed the American war effort of 1941-1945, the fate of European Jews never figured as more than an afterthought.

Crediting the United States with a "great liberating tradition" distorts the past and obscures the actual motive force behind American politics and U.S. foreign policy. It transforms history into a morality tale, thereby providing rationale for dodging serious moral analysis. To insist that the liberation of others has never been more than an ancillary motive is not cynicism; it is a prerequisite of self-understanding. (pages 19-20)

He continues to expose the myth of American Exceptionalism by reviewing the methods employed to expand our borders. He writes:

"How was expansion achieved? On this point the historical record leaves no room for debate: by any means necessary. Depending on the circumstances, the United States relied on diplomacy, hard bargaining, bluster, chicanery, intimidation, or naked coercion. We infiltrated land belonging to our neighbors and then brazenly proclaimed it our own. We harassed, filibustered, and, when the situation called for it, launched full-scale invasions. We engaged in ethnic cleansing. At times, we insisted that treaties be considered sacrosanct. On other occasions, we blithely jettisoned solemn agreements that had outlived their usefulness.

As the methods employed varied, so too did the rationales offered to justify action. We touted our status as God's new Chosen People, erecting a "city upon a hill" destined to illuminate the world. We acted at the behest of providential guidance or responded to the urgings of our "manifest destiny." We declared our obligation to spread the gospel of Jesus Christ or to "uplift little brown brother." With Woodrow Wilson as our tutor, we shouldered our responsibility to "show the way to the nations of the world how they shall walk in the paths of liberty." Critics who derided these claims as bunkum--the young Abraham Lincoln during the war with Mexico, Mark Twain after the imperial adventures of 1898, Senator Robert La Follette amid "the war to end all wars:--scored points but lost the argument. Periodically revised and refurbished, American exceptionalism (which implied exceptional American prerogatives) only gained greater currency. (pages 20-21)


He summarizes later, "...the defining characteristic of U.S. foreign policy at its most successful has not been idealism, but pragmatism, frequently laced with pragmatism's first cousin, opportunism." (Page 22)

This in essence is the best of the book. He skewers presidents and their advisers throughout the book--including everyone from Kennedy through George W. Bush. He is most hard on Reagan, Clinton, and both Bushes as they have been the ones most responsible for the state of affairs in Washington.

This book will surely be distasteful to conservatives who live under the illusion of American Exceptionalism, but it will also serve to disillusion those who believe that Barack Obama will bring meaningful change to Washington. In his conclusion, he anticipates Obama's victory and recognizes that no politician will be able to deliver change because:

"The real aim is to ensure continuity, to keep intact the institutions and arrangements that define present-day Washington. The veterans of past administrations who sign on as campaign advisers are not interested in curbing the bloated powers of the presidency. They want to share in exercising those powers. The retired generals and admirals who line up behind their preferred candidate don't want to dismantle the national security state. They want to preserve and, if possible, expand it. The candidates who decry the influence of money in national politics are among those most skilled at courting the well-heeled to amass millions in campaign contributions." (page 171)

So what to make of all this? Bacevich has his own ideas, and they are good, insofar as they go. But real change must occur within the people of the nation. As Bacevich even testifies, the people are as responsible for the state of affairs as the politicians are. Let us repent and change. That is the only way.

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Thursday, November 19, 2009

The Limits of Power - Review Part I

Last week I linked to Peter Leithart's review of Andrew Bacevich's book The Limits of Power: The End of American Exceptionalism. I just competed the book myself, and will add a few words.

Bacevich is highly critical of contemporary America. In his introduction he writes:

"Realism in this sense implies an obligation to see the world as it actually is, not as we might like it to be. The enemy of realism is hubris, which in Niebuhr's day, and in our own, finds expression in an outsized confidence in the efficacy of American power as an instrument to reshape the global order.

Humility imposes an obligation of a different sort. It summons Americans to see themselves without blinders. The enemy of humility is sanctimony, which gives rise to the conviction that American values and beliefs are universal and that the nation itself serves providentially assigned purposes. This conviction finds expression in a determination to remake the world in what we imagine to be America's image.

In our own day, realism and humility have proven to be in short supply... Hubris and sanctimony have become the paramount expressions of American statecraft." (page 7)


Bacevich sees America as a proud, and aloof nation. We in essence are our own idol, and seek to proselytize the rest of the world. But that is not all.

"The collective capacity of our domestic political economy to satisfy those [self indulgent] appetites has not kept pace with demand. As a result, sustaining our pursuit of life, liberty, and happiness at home requires increasingly that Americans look beyond our borders. Whether the issue at hand is oil, credit, or the availability of cheap consumer goods, we expect the world to accommodate the American way of life.

The resulting sense of entitlement has great implications for foreign policy. Simply put, as the American appetite for for freedom has grown, so too has our penchant for empire." (page 8)


He writes more on the profligacy of America in chapter one. He writes:

"If one were to choose a single world to characterize that identity, it would have to be more. For the majority of contemporary Americans, the essence of life, liberty, and the pursuit of happiness centers on a relentless personal quest to acquire, to consume, to indulge, and to shed whatever constraints might interfere with those endeavors." (page 16)

"The ethic of self-gratification threatens the well-being of the United States. It does so not because Americans have lost touch with some mythical Puritan habits of hard work and self-abnegation, but because it saddles us with costly commitments abroad that we are increasingly ill-equipped to sustain while confronting us with dangers to which we have no ready response. As the prerequisites of the American way of life have grown, they have outstripped the means available to satisfy them. Americans of an earlier generation worried about bomber and missile gaps, both of which turned out to be fictitious. The present-day gap between requirements and the means available to satisfy those requirements is neither contrived nor imaginary. It is real and growing. This gap defines the crisis of American profligacy." (page 17)


So at the heart of Bacevich's criticism, America has become a profligate, self-serving nation, bent on bringing its power to bear upon those that will not serve its interests or appetites.

More to come...

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The Meaning of Capital, Part III

We've discussed the importance of capital and its development in the previous two posts--now for a look at our contemporary understanding of capital. Recall that Hernando De Soto wrote the "essential meaning of capital has been lost to history. Capital is now confused with money..." (The Mystery of Capital page 43) De Soto theorizes that this has happened "because modern business expresses the value of capital in terms of money." I agree with this thesis, though I believe that paper money has led to or at least exacerbated this confusion.

Money was once limited by the amount of silver or gold in circulation, and represented capital in a one to one ratio. But through fractional reserve banking, deficit financing, and the central bank's ability to print paper money the true capital represented by money became diluted with money which had no value, and in fact represented debt, not capital.

This co-mingling of money representing capital and money representing debt has led to great confusion over what is capital, and the notion that wealth may be generated by adding money into circulation. But as Herbert Schlossberg has written, this is a wicked impulse, as it attempts "to create value ex nihilo and imitate the creative power of God." (Idols For Destruction page 92)

Recall again De Soto, who writes, "Third World and former communist countries are infamous for inflating their economies with money--while not being able to generate much capital." Let that sink in. We are using Third World tactics to maintain our economy. What does that mean for our future? Again, reflect upon this.

America was once a great manufacturing nation, but over the past twenty years we have moved to a service economy. We have used hedonics and other gimmicks to show GDP growth all the while, our productive capacity is diminishing. The fact that our trade deficit exceeds $30 billion per month is evidence that we are living on capital. Rather than live within our means, we are have chosen to live on credit, delaying the inevitable day of reckoning when all our debts become due.

Again, I must quote Herbert Schlossberg. I've written on this quote before, and will again, as it is imperative that we take to heart this lesson:

"Consuming capital is perhaps the clearest sign that greed has come to dominate our economic life. That is the moral meaning of such phenomena as pollution and the transformation of farming into a mining operation through the depletion of the topsoil and the draining of the underground reservoirs. A decline in wealth ought to mean that consumption diminishes, but a moral failure prevents that from happening. Instead, a way is found to continue consumption at its former levels: living on capital. Thus the capital stock is raided. Roads, bridges, and buildings deteriorate, long-term borrowing finances current consumption, and the individual base falls into obsolescence. Paul McCracken of the University of Michigan calculates that the industrial capital stock is now falling instead of rising at its historic annual rate of 2.5 percent. We have hardly begun to pay for this in unemployment and reduced output. As more capital is destroyed by policies of taxation and inflation, people will remove it from uses that make it vulnerable. Saving will seem increasingly improvident, and more capital will either be consumed or placed into such unproductive forms as precious metals and collectibles. In any case, funds will not be available to build factories, schools, and barns. As the capital stock continues to be consumed, the pauperization process feeds upon itself. People persist in maintaining their standard of living through more capital consumption and currency depreciation. The system eventually collapses." (Idols For Destruction page 281-282)

Wednesday, November 18, 2009

Food For Thought on Energy

I've linked to the Crash Course by Chris Martenson before, so if you've watched it, this video will not be news to you. In this video, Chris looks at energy in a ten minute presentation that ought to at least give you pause.

What would happen if oil became scarce?



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The Realignment of Currencies

Nathan's Economic Edge posted some videos from a Glenn Beck show where he interviewed Damon Vickers, the Managing Director of Nine Points Capital Partners.

The interview begins around minute 7:00 in the first video. The first six minutes are not news to regular readers of this blog, feel free to skip them. The interview is remarkable, in that Vickers anticipates a realignment of global currencies. His argument, in essence is that America is unable to compete in the manufacturing sector. Countries like Bangladesh can pay their employees $0.70 or $1.00 per day--of course America cannot compete with that.

Vickers argues that "the dollar is way too high and other currencies are way too low. What you're likely to see is a realignment of currencies. Beck and Vickers continue their discussion and argue that we're "going to live closer to the standard of Mexico than you are of America.

Here are the numbers: Mexican per capita income was $14,200 compared to America at $47,000. What are the implications of such a drop in the standard of living? I'm not certain, but it is frightening to ponder what must happen for this realignment to occur. But consider if this were to happen and our nation's debts must be paid--hyperinflation becomes a not-so-unlikely scenario as our debts must then be repaid in appreciated dollars, which would devastating to the American economy. The temptation would then, of course, be to inflate away.

The first two videos are definitely worth watching, the third is not directly related to the topic, but also worth watching.







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More Wilson on Education

My admiration and respect for Douglas Wilson is difficult to hide, so why bother. The man is a brilliant cultural critic. He's got another great post on higher education as a follow up to yesterday's.

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The Meaning of Capital, Part II

In my previous post we learned that capital is "a permanent value, that multiplies and does not perish"--meaning that it is of lasting consequence and may not only be preserved, but multiply in value. Fertile farm land is perhaps the best example of capital, as it holds value due to its ability to produce food for human consumption--the most basic of human needs. Paper money on the other hand, is a perfect example of what capital is not, though may represent. Paper money operates on the whims of perceived value. A one trillion dollar note form Zimbabwe has virtually no value beyond being a collector's item--its value has been lost because the government responsible for printing it printed too many of them.

Clearly capital is of the utmost value, and must not only be preserved, but enhanced for the survival of our species. "Machinery, buildings, and lands" are the things that provide sustenance and protection in their most basic functions, but may also add comfort, luxury, and development in their more enhanced functions.

But capital is not all that is required--as human creativity, skill, and labor must be employed to shape, develop, and enhance the capital stock. Land without a skilled farmer is of little value. A hammer without a skilled carpenter is dangerous and unproductive. A building with a leaky roof or drafty window compromise the value of the shelter.

I will again bring Herbert Schlossberg and Idols For Destruction into this discussion. Schlossberg writes:

" If we understand capital, in the broadest sense, to be any asset--material or non-material--that produces continuing benefits of any kind, then its importance becomes clearer. With the biblical norms increasingly spurned by an idolatrous society, the family structure, the intellectual competence, the legal foundations, and the economic base--in other words, the capital--are all decaying. Therefore, the stability, peace, and prosperity they should be producing will increasingly be lacking." Idols For Destruction
page 317

Schlossberg also defines capital as producing "continuing benefits." This is the aim of holding capital--to reap more and more from it. In a way it is like living off of interest--as long as the principal remains intact, this may continue as long as interest rates are maintained. But as soon as the principal is tapped into without replenishment, it is only a matter of time before the principal is expended entirely.

Next, we'll look at our current situation.



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Tuesday, November 17, 2009

Christian Higher Education

Doug Wilson has a great post on Christian higher education. I commend the piece to you.

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A Good Summary of the Looting of America

Here is a great article summarizing the manner in which America is being looted.

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The Meaning of Capital, Part I

I am reading Hernando De Soto's book The Mystery of Capital right now and encountered a helpful definition of capital, as well as how it has been lost and distorted in contemporary use:

"Simonde de Sismondi, the nineteenth-century Swiss economist, wrote that capital was "a permanent value, that multiplies and does not perish... Now this value detaches itself from the product that creates it, it becomes a metaphysical and insubstantial quantity always in the possession of whoever produced it, for whom this value could [be fixed in] different forms." The great French economist Jean Baptiste Say believed that "capital is always immaterial by nature since it is not matter which makes capital but the value of that matter, value has nothing corporeal about it..."

"This essential meaning of capital has been lost to history. Capital is now confused with money, which is only one of the many forms in which it travels. It is always easier to remember a difficult concept in one of its tangible manifestations than in its essence. The mind wraps itself around "money" more easily than "capital." But it is a mistake to assume that money is what finally fixes capital. As Adam Smith pointed out, money is the "great wheel of circulation," but it is not capital because value "cannot consist in those metal pieces." In other words, money facilitates transactions, allowing us to buy and sell things, but it is not itself the progenitor of additional production. As Smith insisted, "the gold and silver money, which circulates in any country, may very properly be compared to a highway, which, while it circulates and carries to market all the grass and corn of the country, produces itself not a single pile of either."

Much of the mystery of capital dissipates as soon as you stop thinking of "capital" as a synonym for "money saved and invested." The misapprehension that it is money that fixes capital comes about, I suspect, because modern business expresses the value of capital in terms of money. In fact, it is hard to estimate the total value of a collection of assets of very different types, such as machinery, buildings, and land, without resorting to money. After all, that is why money was invented; it provides a standard index to measure the value of things so that we can exchange dissimilar assets. But as useful as it is, money cannot fix in any way the abstract potential of a particular asset in order to convert it into capital. Third World and former communist nations are infamous for inflating their economies with money--while not being able to generate much capital." The Mystery of Capital, pages 43-44.


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Friday, November 13, 2009

Raw Milk

I have come across favorable words for raw milk several times over the last few months, most recently in Joel Salatin's writings. Most recently, I encountered an article written by Joseph Mercola on the health benefits of raw milk. I'm curious if any of my readers have any experience with it.

Those that favor raw milk argue that it is full of nutrition unavailable in pasteurized and homogenized milk. Joseph Mercola writes, "It's not uncommon for people who drink raw milk to report improvement or disappearance of troubling health issues--everything from allergies to digestive trouble to skin problems like eczema."

Realmilk.com defines real milk as:

  • Coming from real cows, not a specific Holstein bred for quantity, not quality
  • Coming from cows that eat real food--namely grass during spring and summer, and hay, silage, and root vegetables during winter
  • Unpasteurized
  • Not Homogenized
  • Contains butterfat
  • Contains no additives
I have requested a book from the library entitled, "The Untold Story of Milk that looks to be a good source of information on the topic.

If you want to read up on raw milk online there are many good resources including this one and this one.

I also recommend watching this video:




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Is Nidal Malik Hasan a Patsy?

The official story about the Fort Hood killer, Nidal Malik Hassan, is that he is an Islamic extremist with connections to terrorists, and has been under investigation for months. But this official story rests upon some very tenuous foundations and may simply be a ruse to cover-up an even more unseemly story.

Skeptics raise many doubts about the official story:

  • "There is no way a psychiatrist - basically an intellectual desk jockey - shot off hundreds of rounds with two pistols and hit about 40 people without being subdued by someone. Come on! He wasn't a trained assassin or a special ops commando shooting up a mall. He would have had to reload and that means putting one of the pistols down and reloading the other with seasoned combat vets in that deployment center. It only takes seconds to reload, but it only takes a second to subdue him."
  • "No way! That would be impossible. Even if he had two semi-auto pistols [according to early reports he used a 9mm and a .357 revolver to gun down over 40 people] he would still have had to stop to reload and someone would have jumped his ass. Most people on base aren't carrying [weapons], but MPs are and they would have been there in a heartbeat."
  • "I spent 10 years at Ft Hood. There is no way this 'official' story is legitimate. No way would a room full of combat vets allow this one shooter to get off over 100 rounds! And, it is not normal for the outside security guards to be there. They are at the MP station, and at the main gates. This means the room full of soldiers processing must have been pinned down; multiple shooters is the only plausible scenario. This sounds like Maj. Hasan has been used, and perhaps is a patsy."
It does seem unlikely that one Army Major with limited weapons training could use two handguns to shoot one hundred rounds in five minutes, hitting forty people, some multiple times, before being subdued himself.

But the questions alone are not the only source of concern. The initial reports from Fort Hood raise further doubts as many people were reported to have claimed with certainty that there was more than one shooter.

Signs of the Times lists the early reports that are in direct conflict with the now official Army story:

The initial reports said that 7 people had been killed and 12 wounded in a shoot-out. Reuters relayed that two gunmen had been dressed in "military uniform." One had been taken into custody, but the other was still "on the loose."

Sgt. Major Jamie Posten, speaking on the phone from the base, told CNN that there was definitely more than one shooter involved:



This was also reported by MSNBC, which added breaking news that the shooter still on the loose was now surrounded at the base's postal exchange or commissary, completely separate buildings from the Soldier Readiness Center (where soldiers undergo medical screening prior to deployment), and was armed with a high-powered sniper rifle.



Read the rest and investigate for yourself. We may never know what really happened, but is it not plausible, perhaps even likely, that several men, as first reported, are responsible for the attack at Fort Hood and that Major Hasan was a shooting victim, and now patsy, in an attempt to deflect attention from the true killers and their motives, and placing the blame upon the "Islamic extremist?" I urge you to think for yourselves, and doubt the state line. The state has their own interest in this story, and the truth may have no part in it.

The Sign of the Times editors end their article well:

"Now that Hasan has woken from his coma and begun talking, it will be interesting to see how the propaganda machine reinforces its image of him being the 'Islamic extremist lone gunman terrorist'. How can we verify that any statement he makes through the corporate press has not been made under duress? How soon before we hear him confess, "Yes, it was me, just me, I hate America for it's freedoms! Muslims, stand up and unite against the tyrants!" etc.

What fate awaits Nidal Malik Hasan?

Everybody knows what happened to Lee Harvey Oswald. "

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Thursday, November 12, 2009

Capitalism, God, and Greed Part IV

Herbert Schlossberg argues similarly, "Consuming capital is perhaps the clearest sign that greed has come to dominate our economic life. That is the moral meaning of such phenomena as pollution and the transformation of farming into a mining operation through the depletion of the topsoil and the draining of the underground reservoirs. A decline in wealth ought to mean that consumption diminishes, but a moral failure prevents that from happening. Instead, a way is found to continue consumption at its former levels: living on capital. Thus the capital stock is raided. Roads, bridges, and buildings deteriorate, long-term borrowing finances current consumption, and the individual base falls into obsolescence… We have hardly begun to pay for this in unemployment and reduced output. As more capital is destroyed by policies of taxation and inflation, people will remove it from uses that make it vulnerable. Saving will seem increasingly improvident, and more capital will either be consumed or placed into such unproductive forms as precious metals and collectibles. In any case, funds will not be available to build factories, schools, and barns. As the capital stock continues to be consumed, the pauperization process feeds upon itself. People persist in maintaining their standard of living through more capital consumption and currency depreciation. The system eventually collapses." (Idols pages 281-282)

Coming back to Wendell Berry again, he writes, "To have even the illusion of infinite quantity, we would have to sacrifice both flesh and spirit. It is an old story. Evil is offering us the world: "All these things will I give thee, if thou wilt fall down and worship me." And we have only the old paradox for an answer: If we accept all on that condition, we lose all. What is new is the guise of the evil: a limitless technology, dependent upon a limitless morality, which is to say upon no morality at all. How did such a possibility become thinkable? It seems to me that in the assumption that we can live entirely apart from our way of making a living." (Unsettling of America pages 78-79)

The leading nations, America in the forefront, have abandoned all pretense of living within its means. Rather than recognizing the world has limited resources and limited productive capacity, we have chosen to live off the future of our children. Our money is no longer representative of capital accumulation, but of debt. This paradigm shift has led to a cataclysmic shift in consumption. Consumer goods—food, clothing, gasoline, electricity, etc. have all become far too inexpensive. The world is awash in money and credit leading to gross distortions in the supply and demand of virtually everything. By consuming our children's capital we have not only assumed massive debt, but we've tapped into the resources our children will one day lack.

Many fear that our children will be shackled with debt, as they must, because our debts are insurmountably large. Others believe we will default on the debts. Either option is unfortunate and potentially catastrophic. But perhaps the more frightening prospect is the legacy of capital destruction currently underway.

Wednesday, November 11, 2009

Capitalism, God, and Greed Part III

Murray Rothbard explains the concept behind money in The Mystery of Banking, "Money—as an element in every exchange—permits man to overcome all the immense difficulties of barter. The egg dealer doesn't have to seek a shoemaker who enjoys eggs; and I don't have to find a newsdealer or a grocer who wants to hear some economics lectures. All we need do is exchange our goods or services for money, for the money commodity. We can do so in the confidence that we can take this universally desired commodity and exchange it for any goods that we need." (page 5)

Historically money has always been representative. Money was limited by productive capacity, and therefore limited by resources. There were intrinsic limits to money, and therefore limits to wealth. But man's longing for wealth, ease, and "absolute sovereignty" in the words of Wendell Berry, were unlimited.

Herbert Schlossberg writes in Idols For Destruction, "When gold and silver were the only money, technology could not meet the challenge of imitating it. But when paper was given the power to command economic goods, people could mimic the official press with the unofficial one. This modern form of theft, like all others, comes from envying the possessions of other people and the coveting that impels one to obtain them. " (page 91)

The use of technology in managing money has in no way benefited society long term. It has led to inflation, which Schlossberg denounces, as the Bible itself denounces. "A society that inflates its currency tampers with a moral value. If the economic system lacks the basic honesty that permits economic transactions to reward both seller and buyer, lender and borrower, there can be no sense of justice. It seems right then to seek advantage at the expense of others. Henry Wallich, a member of the Federal Reserve Board, which has proved itself incapable of providing honest money, recently said that prices expressed in dollars no longer mean what they say. "Inflation is like a country where nobody speaks the truth." He compared the use of the inflating dollar with the making of contracts in which the measures of quantity frequently shrink. The Hebrew prophets denounced those changeable weights and measures as a form of oppression that merited judgment. Yet the Federal Reserve Act reads, in part, "to furnish an elastic currency." (page 101)

As Schlossberg says, "Inflation is both a cause and effect of moral decline. The citizens like it because they perceive that it gives them something for nothing. Like many of the policies of the modern social democracies, it transfers wealth from some people to others." The motivation of the inflationist is clear, as is the result: "This modern version of alchemy is what Ludwig von Mises used to call "the philosophy of stones into bread," referring to the temptation of Jesus. That is the alchemist's trick of creating something of value without work. Whether the wizard mutters incantations, mixes formulas, or runs printing presses, he attempts to produce bread without bothering to plow, sow, reap, grind, and bake. He tries to create value ex nihilo and imitate the creative power of God. What he really accomplishes is the taking of someone else's bread." (page 92)

What we are now witnessing, and as both Schlossberg and Berry would argue, is the taking of our children's bread. Berry writes, "When supposed future needs are used to justify misbehavior in the present, as is the tendency with us, then we are both perverting the present and diminishing the future. But the most prolific source of justification for exploitive behavior has been the future. The exploitive mind characteristically puts itself in charge of the future. The future is a time that cannot conceivably be reached except by industrial progress and economic growth. The future, so full of material blessings, is nevertheless threatened with dire shortages of food, energy, and security unless we exploit the earth even more "freely," with greater speed and less caution. The obvious paradoxes involved in this—that we are using up future necessities in order to make a more abundant future; that final loss has been made a calculated strategy of annual gain—have so far been understood to not great effect… It is as if the future is a newly discovered continent which the corporations are colonizing. They have made "redskins" of our descendants, holding them subject to alien values, while their land is plundered of anything that can be shipped home and sold." (Unsettling of Culture page 58)

To be continued...

Tuesday, November 10, 2009

Civil Disobedience and the Christian

When Christians ponder civil disobedience, they must reckon with Romans 13--a text that, as Doug Wilson argues, may easily be misunderstood.

The relevant text is:

"1 Let every person be subject to the governing authorities. For there is no authority except from God, and those that exist have been instituted by God. 2 Therefore whoever resists the authorities resists what God has appointed, and those who resist will incur judgment. 3 For rulers are not a terror to good conduct, but to bad. Would you have no fear of the one who is in authority? Then do what is good, and you will receive his approval, 4 for he is God's servant for your good. But if you do wrong, be afraid, for he does not bear the sword in vain. For he is the servant of God, an avenger who carries out God's wrath on the wrongdoer. 5 Therefore one must be in subjection, not only to avoid God's wrath but also for the sake of conscience. 6 For because of this you also pay taxes, for the authorities are ministers of God, attending to this very thing. 7 Pay to all what is owed to them: taxes to whom taxes are owed, revenue to whom revenue is owed, respect to whom respect is owed, honor to whom honor is owed."

Wilson has a great post concerning this, though far too brief, as I would like to find a good in-depth study of the meaning and interpretation of Romans 13.

Wilson writes, "..."obey the existing authorities," in our setting, does not mean submission to arbitrary and capricious government. The president, the Congress, and the judiciary are all part of our existing authority, true. But so are our state and local governments, and so are our constitutions. So the question is this -- does our existing authority authorize such direct action by the people? Is such behavior constitutional?"

He goes on to list some examples which I found very helpful. Note that Wilson in no way advocates violence, but he does advocate disobedience--a careful distinction that must be made.

Read the whole thing.

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You Reap What You Sow

What could be more emblematic of our societal decay than women soccer players physically assaulting one another on the field? This is utter madness and I scarcely know what to say.



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The Limits of Power

I just read a review of The Limits of Power: The End of American Exceptionalism. The book is written by Andrew Bacevich, the review by Peter Leithart at Credenda Agenda. I suggest you read the review and perhaps read the book. I just requested it through our library, and hope to read it shortly, as it sounds like a good one.

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Capitalism, Greed, and God Part II

Wendell Berry's ideas concerning human sovereignty intersect the ideas of another great book—Idols For Destruction by Herbert Schlossberg. Schlossberg writes, "The culture of Western nations in which humanitarian thinking is dominant is a rentier living off the moral capital accumulated by its predecessors and giving no attention to replenishing it. When it runs out, the horrors begin in earnest… Humanism is a philosophy of death." (pages 81-82)

I suspect it would be helpful to define "rentier." A Rentier is a rent-seeker. Wikipedia defines rent seeking as, "when an individual, organization or firm seeks to earn income by capturing economic rent through manipulation or exploitation of the economic environment, rather than by earning profits through economic transactions and the production of added wealth."

Schlossberg like Berry, recognizes the usurpation of God's sovereignty. He writes, "Humanitarianism is saviorhood, an ethic perfectly suited to the theology that divinizes man. But the theology that divinizes man, it turns out, only divinizes some men." (page 87)

Our system of government was founded upon checks and balances, distributing power broadly, to restrain tyranny. We still give lip service to these ideals, though in practice they were long ago abolished. Those with ambition for power have long sought positions of influence within government. The merger between corporate and government interests has led to oligarchy—where power is vested in few. The oligarchy is not only self-serving, but self-perpetuating. The rich and powerful have gained access to lawmakers through money, who in turn make the rich richer, and the powerful more powerful.

Government controls and regulations are not so much designed for accountability, as they were to enshrine the rich and install barriers for competitors. Large corporations are in large part, responsible for the "new intensity of greed" as Berry puts it, because they have become the model for industry. Who better to imitate than the successful? The successful, at least broadly, have arrived there through stimulating the government to manipulate the market and monetary policy.

This is the point where Schlossberg continues the argument further, at least more broadly, than Berry. Schlossberg recognizes man's longing for God's creative power, and how it has recently manifested itself in civilization. Schlossberg discusses the medieval alchemists who attempted to turn base metals into gold—effectively "creating something of value without work." (page 92) Modern man believes he has found a way to do this—money printing.

To be continued...

Monday, November 09, 2009

Capitalism, Greed, and God

Last evening I was reading Wendell Berry's The Unsettling of America: Culture and Agriculture—specifically chapter five, entitled "Living In The Future." Thus far I have been amazed at Berry's insights and ideas. One idea in particular resonated deeply with me, and with ideas that I've been writing about on this blog for many months—namely greed, capitalism, and agriculture.

Berry muses on how the modern men have usurped God's authority by overturning the created order. We have abandoned the search for Eden, the lost garden, by attempting to re-create it for ourselves. This is surely not a new phenomenon, as many are familiar with the Tower of Babel, the story in Genesis in which, the people said, "Come, let us build ourselves a city and a tower with its top in the heavens, and let us make a name for ourselves, lest we be dispersed over the face of the whole earth." (Genesis 11:4) Upon visiting the city, the Lord said, "Behold, they are one people, and they have all one language, and this is only the beginning of what they will do. And nothing that they propose to do will now be impossible for them. Come, let us go down and there confuse their language, so that they may not understand one another's speech." So the Lord dispersed them from there over the face of all the earth, and they left off building the city." (Genesis 11:6-8) The ESV Study Bible is instructive:

"This episode is significantly more important than its length suggests. It presents a unified humanity using all its resources to establish a city that is the antithesis of what God intended when he created the world. The tower is a symbol of human autonomy, and the city builders see themselves as determining and establishing their own destiny without any reference to the Lord. (The tower story may also be a polemic against Mesopotamian mythology. Eridu Genesis, a fragmentary text found at Ur, Nippur, and Nineveh, describes the goddess Nintur's calling for humanity to build cities and to congregate in one place. Her desire, according to this text, is that humans be sedentary and not nomadic. Yahweh demands just the opposite, so that the earth would become populated."

Berry continues, attempting to explain the phenomenon, recognizing that what is occurring in modern men is new, in that men have been successful in usurping ultimate sovereignty. He writes, "We have indeed learned to act as if our sovereignty were unlimited and as if our intelligence were equal to the universe." Yet, as he writes, we have succeeded in this task, the results have been "catastrophic." So just as at Babel, God has foiled our designs.

Yet we persist in our machinations against our creator. Berry wonders how it is that we have not only succeeded in deluding ourselves into believing ultimate sovereignty belongs to us. He writes, "It is necessary to account for a new intensity of greed—a greed newly empowered, under no constraint to see itself as evil, allied (so it believes) with a manifest destiny and the way of the world. There must have been no just a shift of basic assumptions, not just a motive, but also some kind of vision or dream or psychic lure."

What can account for this "psychic lure?" Berry believes it is "the future." He explains, "What has drawn the Modern World into being is a strange, almost occult yearning for the future. The modern mind longs for the future as the medieval mind longed for Heaven. The great aim of modern life has been to improve the future—or even just to reach the future, assuming that the future will inevitably be 'better.'"

This isn't a wholly satisfying explanation in my mind, but it is a great insight and a very useful one. What is most important to recognize is the idolatry of modern man. "The modern mind longs for the future as the medieval mind longed for Heaven." This is idolatry, though Berry doesn't use the term.

To be continued…

Gulp...


Nathan's Economic Edge collects the week's best political cartoons every week. This is one of my favorite this week:



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The Settlers of Catan

Four and a half years ago, our friends Charles and Debra introduced us to a game called The Settlers of Catan. After playing one game, I was hooked. Naomi gave me the game for my birthday a couple of months later, and we began introducing the games to friends and family. We have introduced it to probably a dozen families or more already. When we play a game--it is almost assuredly either The Settlers of Catan, or more recently Ticket To Ride.

I am writing about this, because Wired has just published a story about the game and its increasing popularity. Those that are already familiar with the game will find much of the article pedantic, but it also introduces the reader to Klaus Teuber the creator of the game, even includign a picture the man himself. Check it out. If you haven't already played the game, I recommend you do so.

There are several ways to play it for free online:

Java Settlers
S3D Connector
Aso Brain Games

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Wednesday, November 04, 2009

The Omnivore’s Dilemma, Part IV

As Pollan points out, there are alternatives to the government subsidized and sanctioned food system. His primary focus is on Joel Salatin's Polyface Farm, one of the world's leading models for a self-contained, sustainable, local food system. In Salatin's model each animal is given the right to act on its own instincts, eat the food God designed it to eat, and work in symbiosis to not only create meat and eggs, but to invest in the land itself.

Cows are moved to new pasture each day, and three or four days later are followed by chickens. The chickens eat the grub larvae in the cow patties, and in doing so spread the cow patties which fertilize the pasture. The chickens fertilize the pasture themselves with their own manure. The managed grazing and animal manure create a rich, healthy topsoil which in turn supplies more healthy, nutritious grass for the cows to come back and feed upon. He also uses pigs to aerate soil and compost. Salatin doesn't have to worry about sick animals because they are getting the diet God intended their bodies to eat, and consequently their immune systems are healthy.

The system is actually humane and healthy for all involved. There is no pollution, and the only feed introduced into the farm is corn for the poultry. The result is meat that exceeds the nutritional quality of its feedlot competitors. Pollan explains,

"…meat of grass-fed livestock not only had substantially less fat than grain-fed meat but that the type of fats found in grass-fed meat were much healthier. (Grass-fed meat has more omega 3 fatty acids and fewer omega 6, which is believed to promote heart disease; it also contains betacarotine and CLA, another ''good'' fat.) A growing body of research suggests that many of the health problems associated with eating beef are really problems with cornfed beef. In the same way ruminants have not evolved to eat grain, humans may not be well adapted to eating grain-fed animals. Yet the U.S.D.A.'s grading system continues to reward marbling -- that is, intermuscular fat -- and thus the feeding of corn to cows."

This alternative food system is typically local, as it not well suited for industrial sized operations. Industrial feedlots are unnatural, full of pollution, they rape the health of the land, and are not focused on health or nutrition, but their purpose is to provide mass quantities of cheap meat.

Pollan points out in the book that the typical American household spends approximately 10% of its discretionary spending on food, half of what it once was. Americans are conditioned to think that all food is equal, there is no such thing as a "better egg" or "better beef." Grocery stores advertise the best price on the same foods as their competitors. Our food system is meant to be cheap, not nutritious. This is a paradigm shift that is difficult to overcome. After all, our food is subsidized by the government, not only directly through farmer subsidies, but by tax breaks, tax incentives, and lack of accountability to produce a healthy product. These are unseen, unconsidered costs that cloak the costliness of our food, not to mention the costs of obesity, heart disease, diabetes, cancer, and so on.

So the fact that the alternative food system which receives little or no subsidy from the government costs more than the conventional system. But again, consider the costs of the unintended consequences of the conventional system.

My family has just joined a CSA (community shared agriculture) for meat. We'll receive eggs, chicken, beef, and pork from a local family farm that follows the ideas of the alternative, clean food system.

Our first experience with the alternative system was with a whole chicken that was raised on a pasture. While we noticed little difference in the taste, the chicken itself was unlike any other I've encountered. The bones, tendons, and ligaments were considerably stronger than any I've ever carved. It was actually difficult to remove the leg from the body! We have also tried eggs, which, as advertised, had a different color yolk. I encourage you to study these issues and learn more for yourself.

Tuesday, November 03, 2009

The Omnivore’s Dilemma, Part III

It is not just humans that began to eat more corn. Corn has replaced grass as the primary food source for cows. Cows, unlike humans have a second stomach, called a rumen. This rumen allows them to eat and digest grass. Were humans to eat grass, the stomach would be unable to digest it and would expunge it without digesting it. People can eat corn with little consequence, but cows may only eat corn with human intervention.

Pollan wrote an article for the New York Times (which he adapted for The Omnivore's Dilemma) in 2002 describing the consequences of cows eating corn. He writes:

"Perhaps the most serious thing that can go wrong with a ruminant on corn is feedlot bloat. The rumen is always producing copious amounts of gas, which is normally expelled by belching during rumination. But when the diet contains too much starch and too little roughage, rumination all but stops, and a layer of foamy slime that can trap gas forms in the rumen. The rumen inflates like a balloon, pressing against the animal's lungs. Unless action is promptly taken to relieve the pressure (usually by forcing a hose down the animal's esophagus), the cow suffocates.

A corn diet can also give a cow acidosis. Unlike that in our own highly acidic stomachs, the normal pH of a rumen is neutral. Corn makes it unnaturally acidic, however, causing a kind of bovine heartburn, which in some cases can kill the animal but usually just makes it sick. Acidotic animals go off their feed, pant and salivate excessively, paw at their bellies and eat dirt. The condition can lead to diarrhea, ulcers, bloat, liver disease and a general weakening of the immune system that leaves the animal vulnerable to everything from pneumonia to feedlot polio."

These illnesses require intervention and medication. There are reasons doctors tell nursing mothers to not use certain drugs--because the drugs are passed to the nursing child. Yet the USDA not only allows, but encourages feedlot managers to give drugs to cows, which will subsequently be eaten, and passed along to the eater. This is an amazing contradiction in thought.

When corn became the primary diet for cows, they no longer required pasture, as they had always done before. The cows were gathered together in Concentrated Animal Feeding Operations, putting hundreds of cows together in close proximity, typically on concrete. Naturally these cows are left to wade and lay down in their own feces for the duration of their stay at a feedlot. Meat processors are unable to ensure that fecal matter residue does not get onto the processed meat, so they then use irradiation to kill the bacteria. The result is that we may be eating fecal matter on our beef. It is no wonder that many are worried about E Coli, nor is it a surprise that E Coli breakouts are more common now.

This industrial system is being used for pork, chicken, and turkey as well. The results are poor quality meat which is often tainted with bacteria because of cramped confined living quarters in which animals are demanded to grow faster than nature alone would allow. These enterprises are an affront to traditional animal husbandry in which the farmer cares for the animal, treats it humanely, and allows it to live in a manner consistent with its created nature. Of course there are consequences to treating animals without respect to the way God created them. This should be no surprise.

But corn is not the only thing that cows eat on feedlots. The cows are given liquid vitamins, antibiotics, beef tallow (a fat byproduct from cattle slaughterhouses), feather meal from chickens, pig and fish proteins, and as Joel Salatin points out, they often eat chicken manure. Sounds like a healthy, well-rounded diet, no?

Monday, November 02, 2009

Government Default

Gary North has written another article on government default of debt. As always, I recommend reading the whole article.

Here is the conclusion:

"There are two forms: mass (up to 50% per annum) and hyper (the sky's the limit).

Mass inflation seems more likely over the next decade. If the world's central banks can coordinate the expansion of money, thereby funding the national welfare states, the public will not be able to escape. They will pay the inflation tax.

The ways around this are limited to investing in real goods: commodities, small farms, used goods stores, small-town real estate. Not many people will see this in time. Of those who do, few will take action. These escape hatches are for people who are hedging against default. The average voter has no financial reserves. Of the 20% who do have reserves, 80% will be stuck in conventional investments. They will believe the Establishment's Keynesian line. "The government can fix it if you just hang on."

Inflation means the erosion of money. It means a hidden default on the political promises. Why hidden? Because the politicians will blame speculators. They will not blame the Federal Reserve for having bankrolled their promises.

Ultimately, it is either the great depression or the Zimbabwe option. Ludwig von Mises called this the crack-up boom. It means the destruction of money and the collapse of the division of labor. It would mean devastation.

I think central banks will at some point refuse to fund governments any longer. They will bail out the largest banks instead. Foreign politicians may force hyperinflation on their central banks, as agents of the government. But as long as the Federal Reserve System maintains its selective independence, it will not adopt hyperinflation as a policy. That would not be in the interest of the largest banks. It would also not be in the interest of central bankers. Their retirement promises would die."

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The Omnivore’s Dilemma, Part II

In my previous post I introduced the notion of government distortion of the agricultural system. Industrialized corn has become the building block of the American diet. For example, high-fructose corn syrup became the sweetener of choice over sugar. Corn became the new peanut. Look up "corn by products" online and you'll find that corn is in things like glue, to aspirin, to paint. These corn by products in our food are believed to be responsible for an increase in obesity and type II diabetes. Unnatural uses for corn in high volumes have led to consequences that few realize, and without most realizing what has happened.

Pollan wrote an article entitled, "We Are What We Eat," which espouses the same ideas as the book. He writes,

"Take a typical fast food meal. Corn is the sweetener in the soda. It's in the corn-fed beef Big Mac patty, and in the high-fructose syrup in the bun, and in the secret sauce. Slim Jims are full of corn syrup, dextrose, cornstarch, and a great many additives. The "four different fuels" in a Lunchables meal, are all essentially corn-based. The chicken nugget—including feed for the chicken, fillers, binders, coating, and dipping sauce—is all corn. The french fries are made from potatoes, but odds are they're fried in corn oil, the source of 50 percent of their calories. Even the salads at McDonald's are full of high-fructose corn syrup and thickeners made from corn."

He continues, discussing the consequences of our industrial food model:

"I believe very strongly that our overproduction of cheap grain in general, and corn in particular, has a lot to do with the fact that three-fifths of Americans are now overweight. The obesity crisis is complicated in some ways, but it's very simple in another way. Basically, Americans are on average eating 200 more calories a day than they were in the 1970s. If you do that and don't get correspondingly more exercise, you're going to get a lot fatter. Many demographers are predicting that this is the first generation of Americans whose life span may be shorter than their parents'. The reason for that is obesity, essentially, and diabetes specifically.

Where do those calories come from? Except for seafood, all our calories come from the farm. Compared with the mid-to-late 1970s, American farms are producing 500 more calories of food a day per American. We're managing to pack away 200 of them, which is pretty heroic on our part. A lot of the rest is being dumped overseas, or wasted, or burned in our cars. (That's really how we're trying to get rid of it now: in ethanol. The problem is that it takes almost as much, or even more, energy to make a gallon of ethanol than you get from that ethanol. People think it's a very green fuel, but the process for making it is not green at all.)

Overproduction sooner or later leads to overconsumption, because we're very good at figuring out how to turn surpluses into inexpensive, portable new products. Our cheap, value-added, portable corn commodity is corn sweetener, specifically high-fructose corn syrup. But we also dispose of overproduction in corn-fed beef, pork, and chicken. And now we're even teaching salmon to eat corn, because there's so much of it to get rid of."

The "Old Me" would dismiss this as alarmism and unprogressive, but these are not arguments, they are mindless dismissals. As Pollan writes in the book, Americans became obsessed with technological progress in the 1970s and we continue to be. We then ceded more control over our food system to large industry which promised to deliver healthier foods through scientific processes. The model, rather than being biological and holistic has become mechanical, technical, and chemical. Though the change has been largely transparent to most, the change has been significant. Rather than eating a diverse diet, we are eating more corn and corn by products than any other nation on earth, including Mexico, who is known to consume a great deal of corn.