EU’s president on the EUSSR

I never thought that I would write favorably of a speech made by the President of the European Union, but Vaclav Klaus’s speech, for all that it falls well short of the much-needed call for an end to the experiment in Continental Communism by stealth, is remarkably intelligent:

We must say openly that the present economic system of the EU is a system of a suppressed market, a system of a permanently strengthening centrally controlled economy. Although history has more than clearly proven that this is a dead end, we find ourselves walking the same path once again. This results in a constant rise in both the extent of government masterminding and constraining of spontaneity of the market processes. In recent months, this trend has been further reinforced by incorrect interpretation of the causes of the present economic and financial crisis, as if it was caused by free market, while in reality it is just the contrary – caused by political manipulation of the market. It is again necessary to point out to the historical experience of our part of Europe and to the lessons we learned from it.

Many of you certainly know the name of the French economist Frederic Bastiat and his famous Petition of the Candlemakers, which has become a well-known and canonical reading, illustrating the absurdity of political interventions in the economy. On 14 November 2008 the European Commission approved a real, not a fictitious Bastiat’s Petition of the Candlemakers, and imposed a 66% tariff on candles imported from China. I would have never believed that a 160-year-old essay could become a reality, but it has happened. An inevitable effect of the extensive implementation of such measures in Europe is economic slowdown, if not a complete halt of economic growth. The only solution is liberalisation and deregulation of the European economy.

And I would never have believed I’d hear a European head of state citing Bastiat with approval. Long live the Czech Republic, sovereign and free! Unfortunately, I think Klaus is far too optimistic in thinking the EU experiment may somehow be salvageable or that secession is not thinkable. It was a trojan horse from the very beginning, a fascist bureaucracy clothed in democratic capitalist slogans.

Temporary measures

Color me dubious in the extreme:

Senate Banking Committee Chairman Christopher Dodd said banks may have to be nationalized for “a short time” to help lenders such as Citigroup Inc. and Bank of America Corp. survive the worst economic slump in 75 years.

While I understand that the Swedes nationalized their banks for a short time, I haven’t seen any sign that the U.S. government is capable of doing something similar. It seems to me that we are still saddled by a number of “temporary” and “emergency” measures, some of them dating back almost one hundred years. Citi and Bank of America are failed concerns and should be liquidated. $90 billion has already been wasted in attempting to prop up their derivative-ridden corpses; what is the point of wasting even more resources to preserve what are clearly a pair of unviable organizations. And if an institution is supposedly too big to be permitted to fail, isn’t that an indicator that it should be proactively broken up in order to prevent failure in one part taking down the entire institution?

Nationalization won’t work. Throwing more money at the banks won’t work. Given that most people are perfectly capable of understanding when a cancer-ridden patient is inoperable and nothing further can be done, it seems strange that so many them find it hard to grasp that the logic not only applies to medical situations, but economic ones as well.

And if you still don’t believe me about the gravity and scope of the situation, perhaps you’ll believe George Soros and Paul Volcker.

Ron Paul on Bill Maher (Feb 20)


Summary: The 1921 depression ended in a year. The 1929 depression didn’t because the government and monetary authorities chose to intervene. The present depression will last 15 years and the Federal Reserve is responsible for it. End the Empire. Bring the troops home. End the Drug War. Don’t listen to Keynesian economists; they are wrong. Republicans have no credibility because they didn’t practice what they preached. Democrats have made a bad beginning and they will lose their credibility too.

And to think that this is the man that elite, media, and grass-roots Republicans alike rejected in favor of John McCain even as they were plunging into credit-inflated chaos. All I can say is that Republicans richly deserve the contempt in which I and so many other individuals on both the Left and Right hold them.