The Bush Administration Has Been the Most Liberal Administration Since Franklin Roosevelt

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“Is the United States no longer the global beacon of unfettered, free-market capitalism?” asks the International Herald Tribune.

“We have the irony of a free-market administration doing things that the most liberal Democratic administration would never have imagined itself doing in its wildest dreams,” says Ron Chernow, a leading American financial historian.

Where has he been? Where have they all been? They might as well be a spider watching a couple make love; he sees the action but has no idea what is going on.

The Bush Administration has been the most liberal administration since Franklin Roosevelt. It has added more debt, more restrictions, more jackass programs, wars, spending, humbugs and bamboozles than any U.S. government in half a century. The one thing it hasn’t done is raise taxes to increase federal revenues; thank God. But it spent the money anyway!

Not that we’re complaining. Far from it. We’ve enjoyed the show.

Besides, our role here at The Daily Reckoning headquarters is not to gripe and moan…but merely to try to understand. How is it possible for a “conservative” government to nationalize the insurance business? What comes into the heads of “conservative” leaders that makes them want to spend a half trillion they don’t have bailing out investors? Why would any U.S. official with his wits about him want to raise the possibility of war with Russia…over Georgia? Maybe Atlanta would be worth defending…and even there we have our doubts. But Tbilisi?

How does it work? How do people come to think such things? We don’t know, but we have a theory:

People come to think what they must think when they must think it.

In other words, history follows certain patterns. Not predictable. Not exact. But broadly reflecting the inherent blockheadedness of the race…and generally in line with historical precedents.

America is in a period of imperial decline. Its economy is slipping. It citizens are getting poorer, both absolutely…and relative to the rest of the world. The “smart” thing to do would be to hunker down, cut costs, bring troops home, reduce Medicare and Medicaid, raise interest rates, encourage saving and give the country time to get back on its feet economically…so it could enjoy its relative decline with good grace.

But that’s not the way history works. Did Alexander stop at the Hellespont? Did Napoleon stop at the Rhine? Did Hitler stop at the Oder? George Bush I stopped at the border of Iraq. But George W. Bush, under the sway of the neocons, kept going. His mission: to destroy the U.S. empire.

No, of course…he doesn’t know that’s his mission. He’s an agent of change…a useful idiot, as Lenin would have said…a stooge…willing to do what isn’t so smart, but what helps the course of history along to its end.

And now, we have a financial crisis. Does the government respond like Andrew Mellon in the ’20s? “Liquidate labor…liquidate the banks…liquidate the farmer…” said Mellon, willing to let the chips fall where they may. No. That would be smart. Get it over with. Move on. But because the U.S. economy is in a long-term decline, moving on is the last thing people want. In the ’20s, the United States could let chips fall…because it had a growing, dynamic economy. Other chips would rise up quickly. But now it must try to keep the chips from falling…because it is mature…aging…decaying. It wants to hold on…to keep things together…to avoid change.

That’s why socialism is so attractive to Americans…it offers the illusion of safety and stability.

Bill Bonner
for The Daily Reckoning Australia

Bill Bonner

Bill Bonner

Best-selling investment author Bill Bonner is the founder and president of Agora Publishing, one of the world's most successful consumer newsletter companies. Owner of both Fleet Street Publications and MoneyWeek magazine in the UK, he is also author of the free daily e-mail The Daily Reckoning.
Bill Bonner

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Comments

  1. So they have continued the long Republican tradition of knucklehead policy by the uneducated. Now lets just look at the chart; last president to run a budget surplus; oh look it was Clinton.

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  2. Oh charles! apparently you dont read the fine print .clinton’s surplus was a sleight of accounting trickery. by moving more items off balance sheet,he was able to show a surplus. there is naivete all around. sigh.

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  3. The total irony of the epitome of capitalism running to socialism when the going gets tough is utterly hilarious! Marx is spinning in his grave.

    What’s next, China embracing democratic capitalism? Europe embracing Fundamentalism once again? The world’s gone mad!

    Reply
  4. For the last eight years (even further back but to diminished degree) the DTCC has allowed the hedge funds and market makers to short (and naked short) stocks which has resulted in the exploitation of individual investors which are mostly of middle class. The amount approximates $30 trillion from the hedge funds itself. (Perhaps $5 trillion to the hedge fund managers and $25 trillion to their wealthy clients, who mostly must put up one million, or more, to partake in the embezzlement.)

    Do you understand how the “uptick rule” worked and what happened when it was rescinded?

    BTW- Think of $30 trillion as 64 trains of 100 boxcars (with 44 boxcars left over) (standard 40 ft. long) each filled 10 feet deep by 8 feet wide with $100 bills denomination.

    You might write an article about the composition of the Federal Reserve with new new ownership of banking interests making it a global entity and its links to the stock exchanges.

    Who owns the Federal Reserve now?

    Carl

    Reply
  5. Oh dsylexic

    You don’t want to face the facts so you pretend the numbers are sus, that’s ok.

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  6. Carl, times have changed and you might want to stick to the ISO containers sitting in stacks on a wharf if you want to use 40×8′. US domestic containers are larger and they go on bigger flatcars. The the lesser used non intermodal boxcars are now 50′ and 60′.

    Reply
  7. So who exactly are we trying to protect ?
    The Dow went up 4000+ points in 12 months – all those who bought on Buy & Hold can sit & collect Dividends until the price returns in 10 years time – (Hold means Hold).
    Those who bought on Margin will have been Stopped out ages ago.
    Those who bought between 7500 & 10000 should have seen the writing on the wall & sold already – who’s left ?
    Big Business …. ? Whatever.
    Bring back Naked Short Selling – the sooner we get to 6500 > 7500 on the Dow, the sooner we start the recovery – Ma & Pa Kettle are out of the market now – so let the Shorts roll.
    Make the profit on the way down & buy back in for the next ride to the top picking up your Buy & Hold shares on the way through in 2011.
    If a company fails, but the business plan is good, then someone else will launch an IPO & re-start the plan – a chance to get in on the ground floor.
    If the business plan was flawed then “Sayonara buddy” we’re safer without you.
    If bad mortgages through excess credit are the main problem, then rather than us buy them – let the banks file them off-balance sheet – No interest rate increases for 3-5 yrs (a small penalty for them) / amortise the losses as they occur over the next decade back onto the Balance Sheet & transfer the loans back onto their books once the deposit /mortgage reaches 20%/80%.
    Revert to that 10% Reserve Fund they use to have – inspire confidence in the system – not terror.
    I would imagine better than 70% of homeowners can still afford their existing mortgage payments and would probably like to stay in the house – and the way the Fed is cutting rates they may even get a rate reduction.
    The house price will increase again too – it doubles roughly every 7 years – so even after a crash the house will be worth twice what it is now in the next decade.
    By not injecting a gazillion dollars into the US Market the Dollar doesn’t crash (as badly).
    I’m only a Storeman – so maybe a Master of the Universe could expand on this / shoot it down in flames.

    Reply

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