The paranoid left believes the recent protests are orchestrated, when they clearly are mostly not orchestrated.  They profess to wonder why we cannot have a rational debate.  The president bemoans the fact that there is so much misleading information and gosh-darned erroneous rhetoric out there;  please just report it to us when you see it.

What you do not see in the press is any acknowledgment of WHY reasoned debate is pretty much impossible, on either side.  Talking to a member of Congress or the Administration is like talking to a brick wall.  They show up with canned and irrelevant politic-speak.  They are not really going to listen to you or take account of your views or even think, much less actually READ the history changing legislation on which they are casting votes.  They, almost without exception, speak from a talking point sheet composed by their leadership.  In other words, it is all bullshit.  And then Claire McCaskill (D-MO) asks, apparently in all seriousness, “Don’t you trust me?”  Bwah ha ha ha ha ha ha (tears rolling down cheek and falling heavily to the floor).  You have got to be kidding.

It is no wonder then that the only reasonable approach to changing the outcome is just to shout the loudest.  Just say No, No, No or some other slogan that can be chanted over, and over, and over….  Pelosi and her ilk have only themselves to blame.

The tired policies of the past are precisely the kind of ideas with which Obama is going to try to saddle us;  statist ideas whose implementation will still be impeding the growth of our economy when my children’s children’s children start to vote or the great American experiment has finally come to an end, crushed by the burden’s of promises blithely made and obligations flippantly incurred in the distant past, our near future.

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I have been meaning to write about this for about 5 years, but the installment of the Obama administration with what should be a compliant Congress is as good a time as any.  In the sweep of history as viewed from the scale of years to a few decades, we are about 8 to 10 years into a swing away from increasing levels of freedom globally and toward greater statism, or state control of economies and of people’s personal lives.

While there are a few notable exceptions like China which maintained momentum toward greater market orientation, most instances from Asia to Latin America have been swinging the other way.  Like markets, these things do not go in a straight line, but oscillate, sometimes waxing, sometimes waning.

At close scales the change from waxing to waning (if plotted as a curve this would be when the slope of the curve went from positive to negative, not the inflection point from more positive to less positive, ie the change in convexity) is chaotic, messy and jagged, but if you zoom out sufficiently far, it becomes smoother.  I place the changeover in late 1998 with the election of Hugo Chavez in Venezuela.

Prior to 1999, it was clear that there was something magical happening in the world.  The first sign was perestroika in the late 1980s, then the fall of the Berlin Wall in 1989 and the coup in Moscow in 1991.  In 1994 the Uruguay Round of GATT talks concluded, setting the stage for expanded world trade.  In 1995, the Internet became available to a large part of the public.  Large numbers of countries in Eastern Europe, Asia and Latin America were adopting western democratic institutions and opening their economies along market lines.  By 1998 the Internet was a phenomenon, energy was cheap and productivity was galloping forward.  You could find music in any genre from classical to hard core by  any artist on services like Napster and Audiogalaxy.  Open source software blossomed; multitasking operating systems allowed computing to become mainstream.  Prices of things seemed to fall as labor was globalized and living standards around the world brought more people out of poverty than ever before.  It seemed anything was possible as the world headed into the millenium.

Some warning signs had already started to appear.  Late in 1998 Hugo Chavez was elected in Venezuela and started down the path of his self-styled Bolivarian socialist revolution.  At the end of 1999, Putin became President of Russia.  Early in 2000 the asset bubble in technology and other stocks burst.  The major labels put an end to open access to music when Napster was forced to shut down.   The RIAA started suing people for sharing music.  9/11 happened.

After a brief recession, it seemed as if things were going to get back on track.  Home ownership and home prices rose to incredible levels as the stock mania was transmuted by the Fed and a world awash in wealth into the housing bubble.  Commodities began an incredible 6 year bull run in late 2002.  Saddam fell in 2003.  Prices continued falling as manufacturing and service labor was rationalized.  However the forces of statism were resurging and eclipsing the brief flowering of freedom.

Russia jailed Mikhail Khodorkovsky in late 2003.   It was this that really set Crude Oil prices on fire.  Russia also reinstated the practice of sponsoring the murder of political critics.  Russia has returned to a state in which elections are held but they are pretty meaningless as the outcome is known in advance and largely controlled by the party in power, methods that Hugo Chavez and others in Latin America are now also seeking to employ.  More states in Latin America have also turned left;  Bolivia, Argentina, even Brazil.  Other states have also become less free in the last 8 years such as Zimbabwe and Burma (Myanmar).

Now with the bursting of the housing and commodities bubbles and the implosion of the world financial system, even America has elected a congress and a president who are more sympathetic to statism than it has had since Reagan beat Jimmy Carter in 1980.  On the Sunday talk shows this weekend, I heard some idiot (probably Stiglitz) say with relief how the nightmare of the last 25 years has finally come to an end.  Yes.  The ‘nightmare’ that was the greatest period of global wealth creation ever known has finally come to an end.  The question is, is this really the end?  Will the curve of freedom (change) continue below the abscissa?  Or is this a downstroke that will soon reverse?  In other words, will we discard the lessons of history and embrace increasing state control over every aspect of political and economic life?  Or will we remember, pull ourselves together, and return to the path of progress we were on?

“Last week, Rush Limbaugh actually said that he ‘hopes’ President Obama fails to meet America’s challenges.”

That would be mean spirited if it were true.  The problem of course is that that is not what Rush Limbaugh said.  He did say “I Hope he fails”.  He did not say “to meet America’s challenges”.  This is a major difference.  He really said he hopes Obama fails IF success would mean setting America on the path of increased state participation in the economy, one form of which is socialism.

This is why it is so hard to have an honest discussion of issues.  Here is the DCCC, which according to their own web site “is the official campaign arm of the Democrats in the House”, and they are willfully misrepresenting the speech of one of their opponents.

And they frame this page on their site as a petition.  A petition?  A petition for what?   What is the action for which they are petitioning?  This is somewhat dangerous because they are a subgroup of the House of Representatives.  They have the power to create Law.  They do not actually say what action the petition is intended to achieve.  But if the action is to silence a voice of criticism, it is a very dangerous thing, the more so as it is coming from an official organ of our government.

To be clear, I am no fan of Rush Limbaugh.  I do not listen to his radio show.  I find him to be a bit of a blowhard.  But it is curcially important that voices of criticism be heard.  This is what seprates us from states that silence the critics of government such as Viet Nam, China, Russia and Islamic states in the Middle East among others.  If Al Franken could have made a success of Air America, I would have applauded that too.  When you talk of freedom and how our soldiers have died for freedom, the most important of those freedoms by far is the freedom to criticise the government.   The DCCC should take this page down from their site immediately.

They had some clown on to comment on this – he wasn’t actually dressed as a clown obviously but he must secretly yearn to be a clown given the quality of his thought processes – and this clown said “Obviously the reason this is happening is that the [government] programs in place are having no effect [on supporting the housing market]“.  Come again?

First let’s get one thing straight.  The reason that foreclosures are so high is that many many people have signed up for mortgage loans that they can in no way afford to pay.  This inability to pay on the part of large numbers of mortgagees was estimable a priori.  Anyone who did not see it coming should join the CNBC commentator in the circus.

This perversion of thinking is a dramatic illustration of why it is a bad idea to have people come to believe that the government should or must be involved in matters of the economy that were previously left to private actors.  They then also come to believe that when things do not go well it is because the government is not doing enough and that of course the solution is for the government to do more.  They do not then understand that markets have to clear before they can work cleanly again.  Anything that prevents markets from clearing only delays the fact and prolongs the pain, almost certainly increasing the aggregate pain.  There may be slight things that can be done with a light touch that will not perturb this process too much.  But the more the mindset takes hold that government is an acceptable and even necessary economic actor, the more likely it is that the hand will be far too heavy, and therefore ultimately damaging.

Did we not learn this lesson in the 70’s?  There is a reason that the popularity of clowns has waned over the years.  Clowns represent a mask on reality.  They are creepy -  viz. the etrade commercial where the baby underestimates the creepiness of the clown he hires with his trading winnings.  My kids have no time for clowns.  Clowns try to appear to be something they are not.  Like the government trying to be an economic actor.  Something it is not.   Apparently we have already forgotten this lesson which we had apparently learned only 30 years ago and now we have elected people who are ideologically inclined to have the government do more and more.  We will pay the price.   Beware of scary government-is-the-answer clowns.

Microsoft is a hard-nosed, money-grubbing company that had the good sense to create a structural monopoly and the audacity to keep it.  They are not an inside part of the internet community.  And they do not give anything away for free.

Yahoo! is very much West Coast, the promise of America’s frontier.  Microsoft and Mr. Icahn are very much East Coast, America’s past.  I hope Mr.  Icahn fails in his proxy fight to unseat Yahoo!’s board of directors.  I do not want to change my home page from My Yahoo! in the event Microsoft causes Yahoo! to cease to exist.  But if they do, I will change my home page address the next day.

Pack a lunch and walk or bike over to the nearest park with the kids.  Clean the house.  Just do not do anything that requires the use of fuel.  Do not drive anywhere.  Do not drive to work or use public transportation.  Stay home and enjoy the day.

This is the only way to really say “Hey W, STOP buying oil on the open market to fill up the SPR, which is already 97% full.”  Or, “Hey W, ethanol madates!?  Hmm. Looks like that is a bad idea.”  Or, “Hey Saudi Arabian mysoginists, you will have to wait another day to sell us those 8 million barrels of oil.”  Or, “Hey idiots in Congress, maybe we ought to start looking to see what energy resources we have off the coasts or in Alaska.”

So make the decision to stay home, and pass the idea along to your friends.  People CAN make a difference.

It really makes me very angry to see those who promote this kind of statist and oppressive government accumulating ever more wealth at our expense and recycling that wealth into ownership of key assets in our economy (i know I should be happy that they do because it keeps our current account deficit from creating problems and keeps our capital markets healthy, but that doesn’t mean I have to like it). The Middle East is a major locus of dollar reserves abroad because we and others keep sending them so much money for oil purchases. How much? This page at the US Government agency that tracks such things, the Energy Information Association or EIA (oil traders are of course familiar with the EIA, which releases the much watched inventory information on Wednesdays), lists how much we import from various countries. We import roughly 2/3 of the oil we use every day. Note that as I am writing, for the first 9 months of 2007, Saudi Arabia ranks third on this list of oil exporters to the US with around 1.4 Million barrels of oil a day.

So at $90 per barrel that means we alone send the Saudi royal family about $130 Million per day, $50 Billion per year, roughly $5 Million per hour, every hour, 24/7, 365 days a year. Now you can look here, to see that Saudi exports to the US are only about 16% of their exports. Their total exports are about 8.651 Million barrels per day. So the Saudi royal family, at $90 per barrel, rakes in $800 Million per day, nearly $300 Billion per year, or roughly $30 Million per hour, every hour, 24/7, 365 days a year. And that is just the Saudis. That doesn’t include the rest of the despicable people who are raking in this money, and there are plenty of them. So because we depend so heavily on oil to power our economy, a single family is able to run a country of 27 million people as their own private little cult, which happens to be called Wahhabism (Whabbism), and which implements Sharia law, which calls, among other things, for women to be treated as chattel, or is so interpreted by their culture today.

Oil is a fungible commodity, but because we use so much from whatever the source, it supports the market, which supports regimes such as the one in Saudi Arabia, which supports – indeed mandates by law – a fanatical religious cult, which ultimately threatens our way of life, and with whom we do not share similar values. It is a direct link.

If we really want to promote freedom and squelch statists, misogynists and fanatics worldwide, then rather than spending trillions of dollars fighting wars abroad against non-state foes, we could probably put a fraction of these massive public resources into relegating oil to as small a portion of our energy needs as possible. This approach runs counter to deeply ingrained beliefs in our domestic culture. The market has heretofore appropriately dictated how our energy needs are met. Petroleum has been cheap and so has been the most efficient way to power our economy. And this is a good thing.

But I believe we are at a critical point in history that suggests strongly that we need a program similar to putting a man on the moon; that would use public resources to hasten the technological advances that will allow the world to stop sending so much money to people with whom we do not share values and who directly sponsor those who wish to actually kill us. Make no mistake, our dependence on petroleum is itself the biggest threat to our national security. Even if 99% of the money were wasted, if it results in technology allowing us to reduce our reliance on these people, it would be money well spent.

This program should have elements of the X-Prize or the Methuselah Prize. It does not have to be exclusively direct payments to corporations or universities, though we will need plenty of that as well. We can spend $200 Billion a year on this and still have it be money better spent than liberating Afghanistan or Iraq. Better yet, the money will spread to better uses than pure military spending is spread and can kick-start many small companies that will be tomorrow’s giants.

In the meantime, maybe we should pass a law that prohibits male visitors from ridiculous statist Arab theocracies, including Saudi princes, from stepping out in public in the United States unless they are covered from head to toe in a burqa, and accompanied by a female escort, which could be their wife or sister. Make it a condition of their entrance visa. Sounds good to me.