The serious nutjobs at the World Economic Forum just overplayed their hand with this insane tweet:
Not surprisingly, after universal Twitter outrage, the WEF has deleted the tweet.
But don't for a minute think this isn't what the globalists really think.
Sky News host Cory Bernardi put it perfectly. The World Economic Forum, he said in a recent broadcast, is the granddaddy of all global organizations.
The WEF is the architect of the great reset and the fourth industrial revolution.
They coined the #buildbackbetter hashtag that is actually proving so popular with big government elites right across the globe and they even predict that by 2030 you'll own nothing and you'll be happy. They call this servitization which is a term and an agenda that looks a lot like servitude to me...
Severtization begs the question if you don't actually own anything who will own what you're renting? Wel,l the answer lies within the WTF premier forum that's at Davos.
Davos is the gathering of global elites including big business CEOs, industry chiefs, government leaders, bureaucrats and multi-billionaires with political agendas. Under the WEF vision the Davos attendees will own what you'll be renting and trust me on this. It's not going to be a philanthropic enterprise.
They'll all be looking to make more money than they currently do and actually to take more control of your life under the guise of equality by reducing you to a mere user rather than an owner. The world does actually become more equal because it will concentrate power authority and money in the hands of a tiny few. All the rest of us become mere economic vassals for these oligarchs.
So make no mistake severtization is just a new name for economic slavery. It's socialism on a global scale.
So now you see how the WEF can view the lockdowns that have destroyed many small businesses, put millions on the dole, caused suicides and mental depression, as "quietly improving cities."
Lockdowns are improving cities for the elitist monsters as they learn what levers to push to gain more power over the populous--and shrink the global population.
I am not kidding.
Here is the video that accompanied the tweet that was taken down.
They see the lockdowns as a positive:
The bill now moves to the Senate, where another vote will take place.
The package is, of course, highly price inflationary as the federal government does not have the funds to pay for the programs in the bill, thus, resulting in the Federal Reserve Bank creating money out of thin air to support the spending.
The two Democrats who voted against it are Rep. Kurt Schrader, D-Ore., and Jared Golden, D-Maine.
“It's a great day for us to take a vote to reduce the spread of this virus...put vaccinations in the arms of the American people, money into the pockets, children into the schools, workers back into their jobs, so that we can go forward," House Speaker Nancy Pelosi said before the vote. "I salute President Biden for his American Rescue Plan."
No Senate Republicans are expected to support the bill, so the president will have to count on every one of the 50 Democratic senators--and a tie-breaking 51st vote from Vice President Kamala Harris-- for the bill to pass.
The Senate is expected to vote on the bill sometime in the next two weeks.
-RW |
| Dr. Walter Block |
Here is a list of recent articles published by Dr. Walter Block in referred journals. The number before each article represents the number that lists the order in which the article appeared relative to all the refereed articles he has published:
-RW590. Barrau, Anael Louisa, David Chávez Salazar and Walter E. Block. 2019. “Is Free Trade the Answer to Ending Poverty Worldwide? Haiti, a Case Study.” Review of Social and Economic Issues (RSEI), Vol. 2, No. 1, pp. 19-33; http://rsei.rau.ro/index.php/
last.html; http://rsei.rau.ro/images/ V2N1/2-Anael%20Louisa% 20Barrau.pdf
589. Seaman, Matthew and Walter E. Block. 2019. “Fahrenheit 451 and the Education System.” Political Dialogues: Journal of Political Theory; Vol. 27, pp. 55-62; https://apcz.umk.pl/
czasopisma/index.php/DP/issue/ view/1815; https://apcz.umk.pl/
czasopisma/index.php/DP/ article/view/DP.2019.010
588. Cooper, Aidan and Walter E. Block. 2019. “Why Malthus Will Always Be Wrong” Romanian Economic and Business Review. Winter, Vol. 14, No. 4, pp. 32-41; http://www.rebe.rau.ro/REBE-
WI19.pdf
587. Bateman, III, Thomas L. and Walter E. Block. 2019. “Libertarianism and hard determinism.” Molinari Review; Vol. 1, No. 2; https://aaeblog.com/2020/01/
02/molinari-review-i-2-what- lies-within/; http://praxeology.net/ molinari-review-order.htm#1.2
586. Futerman, Alan and Walter E. Block. 2019. “On Taleb on Ricardo: A Critique” Revista Procesos de Mercados; Vol. 16, No. 2, pp. 81-102; https://docs.google.com/
viewerng/viewer?url=http:// www.procesosdemercado.com/wp- content/uploads/2020/01/02_ ART%C3%8DCULO.pdf&hl=es
585. Iglesias, David and Walter E. Block. 2019. “Universal Basic Income: A Critique.” Romanian Economic and Business Review; Fall, Vol. 14, No. 3, pp. 7-18; http://www.rebe.rau.ro/REBE-
FA19.pdf
584. Torsell, Christian and Walter E. Block. 2019. “Effective Self-Ownership and Property Schemes; Comment on G.A. Cohen” Revista Estudios Libertarios; Vol. 2, pp. 14- 27; https://www.
estudioslibertarios.com/en_US/ vol-2-2019/; 583. Hernandez, Alex and Walter E. Block. 2019. “Affirmative Action: Oppressive in Nature?” Acta Economica et Turistica; Vol. 5 No. 2, pp. 85-101; https://hrcak.srce.hr/index.
php?show=toc&id_broj=18502; https://hrcak.srce.hr/index. php?show=clanak&id_clanak_ jezik=337339
582. Block, Walter E. 2019. “Rejoinder to Wysocki on Indifference and the Block-Hoppe Debate Thereon.” Dialogue; Vol. 4; pp. 1-7; https://www2.uni-svishtov.bg/
dialog/issue.asp?issue=345; https://www2.uni-svishtov.bg/ dialog/title.asp?title=1461
581. Jankovic, Ivan and Walter E. Block. 2019. “Private Property Rights, Government Interventionism and Welfare Economics.” Review of Economic Perspectives - Národohospodářský obzor; Vol. 19, No. 4, pp. 365-397; DOI: 10.2478/revecp-2019-0019; https://content.sciendo.com/
view/journals/revecp/revecp- overview.xml?language=en&tab_ body=latestIssueToc-68822; https://content.sciendo.com/ view/journals/revecp/19/4/ article-p365.xml; https://www.degruyter.com/
view/j/revecp.2019.19.issue-4/ revecp-2019-0019/revecp-2019- 0019.xml; 10.2478/revecp-2019-0019; https://www.econstor.eu/
bitstream/10419/227536/1/ revecp-2019-0019.pdf; http://dx.doi.org/10.2478/
revecp-2019-0019
580. Futerman, Alan and Walter E. Block. 2019. “The Fallacy of A Priori Statism.” Stetson Law Review. Fall, Volume 49, pp. 73-91
579. Mamounis, Kyle J. and Walter E. Block. 2019. “The Molecular Basis of Private Property.” Acta Oeconomica Vol. 69, Issue 3, July, pp. 321–332;
https://akademiai.com/toc/032/
69/3; https://akademiai.com/doi/abs/ 10.1556/032.2019.69.3.1; https://akademiai.com/doi/10.
1556/032.2019.69.3.1; https://www.growkudos.com/
publications/10.1556%252F032. 2019.69.3.1/reader
578. Wysocki, Igor, Walter E. Block and Lukasz Dominiak. 2019. “Rothbard’s Welfare Theory: Some Support.” New Perspectives on Political Economy, Vol. 15, No. 1–2, pp. 18-35; https://www.cevroinstitut.cz/
data/nppe-15.pdf
577. Cooper, Aidan and Walter E. Block. 2019. “Symbiosis and Capitalism.” New Perspectives on Political Economy, Vol. 15, No. 1–2, pp. 58-71; https://www.cevroinstitut.cz/
data/nppe-15.pdf
576. Smith, Katy and Walter E. Block. 2019. “Legalize Prostitution.” Journal of Accounting, Ethics & Public Policy; Vol. 20, No. 3, pp. 351-368;
http://ssrn.com/abstract=
3432179
575. Block, Walter E. 2019. “Contra Tanner on Wall Street, financiers, inheritance and egalitarianism.” The Journal Jurisprudence, March, Vol. 38, pp. 27-38; http://www.jurisprudence.com.
au/juris38/Block.pdf;
574. Levendis, John, Walter E. Block and Robert B. Eckhardt. 2019. “Evolutionary psychology, economic freedom, trade and benevolence.” Review of Economic Perspectives - Národohospodářský obzor; Vol. 19, No. 2, pp. 73-92; https://content.sciendo.com/
view/journals/revecp/19/2/ article-p73.xml; 10.2478/revecp-2019-0005; DOI: https://doi.org/10.2478/ revecp-2019-0005; https://www.lewrockwell.com/ lrc-blog/here-is-one-of-my- best-scholarly-papers-ever/; https://pennstate.pure. elsevier.com/en/publications/ evolutionary-psychology- economic-freedom-trade-and- benevolence; https://www.growkudos.com/ publications/10.2478% 252Frevecp-2019-0005/reade
573. Block, Walter E. 2019. “Human shields, missiles, negative homesteading and libertarianism” Ekonomia Wroclaw Economic Review. Vol. 25, No. 1, pp. 9- 22; http://wuwr.pl/ekon/issue/
view/515; http://ekon.wuwr.pl/catalog/- 38; http://wuwr.pl/ekon/article/ view/8520/8138
572. Brown, Clare and Walter E. Block. 2019. “Free market for the environment.” Economic Policy: Russian Presidential Academy of National Economy and Public Administration; Экономическая политика. Т. 14, № 1, С, pp. 116–125; DOI: 10.18288/1994-5124-2019-1-116-
125; https://ideas.repec.org/a/rnp/
ecopol/ep1906.html
571. Chamberlin, Anton and Walter E. Block. 2019. “Wall.E.” Cosmos and Taxis; Vol, 6, Issue 6 + 7, pp. 68-72; https://cosmosandtaxis.org/ct-
667/; https://cosmosandtaxis.files. wordpress.com/2019/05/ chamberlin_block_ct_vol6_iss_ 6_7.pdf
570. Block, Walter E. 2019. “Response to J.C. Lester on David Friedman on Libertarian Theory.” Management Education Science Technology Journal. Vol. 7 Issue 1, pp. 127-155; http://mest.meste.org/MEST_1_
2019/13_17.pdf
569. Block, Walter E. 2019. "Crony Capitalism versus Pure Capitalism." Independent Review. Vol. 23. No. 3, Winter, pp.
http://www.independent.org/
publications/tir/article.asp? id=1347; (Munger)
Joe Biden has appointed 36-year-old Janelle Jones as the Department of Labor’s chief economist.
Bloomberg reports:
For more than a decade in government and research organizations, Jones has focused on finding out why Black people were falling behind in the labor market. She coined the phrase “Black Women Best” to drive home the idea that if policies are crafted to help this historically disadvantaged group, they would help all workers.
“When I see that it’ll take four to five years for the economy to return to full employment, what I’m thinking is that it’ll take Black workers 10 or 12 years,” Jones said. “My role here will be to think about those sorts of things, to give a lens to union workers, low-wage workers, different types of workers who aren’t usually centered.”
But her writing appears to chiefly focused on reporting on new data studies on the differences between black unemployment and white unemployment.
There are these, for example:
At the beginning of 2018, 18 states will increase their minimum wage, providing about $5 billion in additional wages to 4.5 million workers across the country. In a majority of these states, minimum wage increases (ranging from $0.35 in Michigan to $1.00 in Maine) are the result of legislation or ballot measures approved by voters in recent years. Eight of these states (Alaska, Florida, Minnesota, Missouri, Montana, New Jersey, Ohio, and South Dakota) will have smaller automatic increases that adjust the minimum wage to keep pace with price growth. This automatic inflation adjustment preserves the buying power of the minimum wage, which has steadily eroded over time.
And there you have it, Biden's pick for chief Labor economist, confused about the basics of how minimum wage laws cause damage.
As Thomas Sowell put it:
The minimum wage law is very cleverly misnamed. The real minimum wage is zero – and that is what many inexperienced and low-skilled people receive as a result of legislation that makes it illegal to pay them what they are currently worth to an employer.
Most economists have long recognized that minimum wage laws increase unemployment among the least skilled, least experienced, and minority workers. With a little experience, these workers are likely to be worth more. But they cannot move up the ladder if they can’t get on the ladder.
For a full discussion of how the minimum wage hurts everyone, including those who receive the nominal pay wage, see: Understanding the Numerous Problems With Minimum Wage Laws.
Here's a small step toward respect for private property.
A federal U.S. District Judge in Texas ruled Thursday that the moratorium on evictions due to the pandemic is unconstitutional.
Trump-appointee John Barker ruled that the Centers for Disease Control and Prevention’s (CDC) halt on evictions exceeded the authority of the federal government. Barker, however, did not issue a preliminary injunction but noted he expects the CDC to abide by his ruling and withdraw the moratorium, notes the Daily Caller.
“Such broad authority over state remedies begins to resemble, in operation, a prohibited federal police power,” Barker wrote.
Now if we could just find a judge willing to rule the lockdowns unconstitutional so that people could actually get to work and be able to pay their rent.
But, of course, the Biden administration is instead focusing on methods to workaround the judge's order.
White House officials told the Daily Caller that the president is disappointed with the decision from Barker and that the Department of Justice is evaluating options to proceed with the moratorium.
-RW |
| Senate Parliamentarian Elizabeth MacDonough |
Well, a small short-term victory, on a technicality, for free exchange.
Late Thursday night the Senate parliamentarian ruled that the provision to increase the minimum wage to $15/hour cannot be included in the broader $1.9 trillion COVID relief package.
Specifically, the “reconciliation,” the method by which Democrats plan to pass the $1.9 trillion package, allows any bill in which each provision affects the federal government’s finances to be voted on by a 51-vote majority, as opposed to the regular 60 votes needed to overcome a filibuster. The Democrats don't have the 60 votes to overcome a filibuster of the bill.
The parliamentarian, Elizabeth MacDonough, determined that the provision was "merely incidental" to the government's finances, according to a statute known as the Byrd rule.
The socialist, Senator Bernie Sanders has issued this statement:
I strongly disagree with tonight's decision by the Senate Parliamentarian. The CBO made it absolutely clear that raising the minimum wage to $15 an hour had a substantial budgetary impact and should be allowed under reconciliation. It is hard for me to understand how drilling for oil in the Arctic National Wildlife Refuge was considered to be consistent with the Byrd Rule, while increasing the minimum wage is not.
60 percent of the American people want to raise the minimum wage to $15 an hour. The House of Representatives has voted to raise the minimum wage to $15 an hour. The President of the United States wants to raise the minimum wage to $15 an hour. I'm confident that we have a majority in the United States Senate including the Vice President that would vote to increase the minimum wage to $15 an hour as part of President Biden's American Rescue Plan. Yet because of the archaic and undemocratic rules of the Senate we are unable to move forward to end starvation wages in this country and raise the income of 32 million struggling Americans. That fight continues.
In the coming days, I will be working with my colleagues in the Senate to move forward with an amendment to take tax deductions away from large, profitable corporations that don't pay workers at least $15 an hour and to provide small businesses with the incentives they need to raise wages. That amendment must be included in this reconciliation bill.
For a full discussion of how the minimum wage hurts everyone, including those who receive the nominal pay wage, see: Understanding the Numerous Problems With Minimum Wage Laws.
Bill Dudley, former president of the New York Federal Reserve Bank, writes in a column at Bloomberg:
[I]nflation is a slow-moving process. The economy would have to run hot for a long time to push inflation significantly higher. Consider what it took to generate the double-digit inflation of the late 1970s: First the guns-and-butter spending of the Vietnam War and Lyndon Johnson’s Great Society program, then the Nixon administration’s wage and price controls, then two big oil-price shocks.
This is what the members of the Federal Reserve are thinking.
But this is extremely shallow one-dimensional thinking.
Between 1960 and 1982, M2 money supply growth never climbed at an annual rate of more than 13.5% (see chart below).
M2 Money Supply Annualized Growth 1960 to 1982
What is going on now is a far greater extreme than what occurred in the 1970s. To simply overlay the 1970s over the current period and to think the same slow-developing price-inflation story will play out is remarkable blindness to what is really occurring at the present time.
The 1970s faced a flood of money supply growth, we are experiencing a tsunami.
-RW
So where does Goldman Sachs stand on the work from home theme?
David Solomon, CEO of Goldman Sachs, said at a Credit Suisse Group AG conference on Wednesday, that our employees working from home "is not ideal for us and it’s not a new normal. It’s an aberration that we are going to correct as quickly as possible.”
“I am very focused on the fact that I don’t want another class of young people arriving at Goldman Sachs in the summer remotely,” Solomon said.
-RW
By Thomas Spain
During the 1990s there was a legal and philosophical idea, championed by Milton Friedman among others, that a corporation exists to serve the interests of the shareholders, being that they are the rightful owners of the corporation. Progressive thought leaders responded with the countertheory of stakeholder capitalism. Under stakeholder theory the shareholders have a stake in the success of the firm, but the firm also has a competing obligation to other entities deemed “stakeholders.” Stakeholders are employees, customers, suppliers, and the community. While this theory is presented as a commonsense truism, it has one specific foundational flaw: it dilutes and undermines the principle of private property.
To own a thing in principle is to have control over its use. An owner of a company, in a market system, has ultimate discretion over and responsibility for how the assets of the company are used. In a joint-stock company, the decision-making is shared by the various owners of shares. But in stakeholder capitalism, all of the stakeholders have influence in company decisions. Therefore, stakeholders are de facto joint owners of the corporation, and advocates of stakeholder capitalism would seek to make this ownership a legal reality.
When stakeholder capitalism is expounded by its advocates, it’s easy to believe that it is not as much a social theory as simply good advice. Businesses seek to develop mutually beneficial relationships that will last into the long term. As a means to that end, it is good business practice to maximize the contentedness of your employees, deal honestly with your suppliers, survey the needs of your customers, and keep a good image in the community. However, stakeholder capitalism goes beyond good practice by putting government power on the side of the stakeholders.
We can see what the joint ownership of stakeholders looks like in practice. For employee stakeholders, control would mean union representation on the corporate board. For supplier stakeholders, industry oversight associations would oversee contracts, making them impossibly difficult to terminate while outlawing any market choice. Customers would be represented by consumer protection bureaus. And community stakeholders would mean democratic approval of business actions by government committees.
While in the free market stakeholders vote directly with their dollars, in stakeholder capitalism the nominal stakeholders never exercise their ownership stake directly. Rather they are represented indirectly or bureaucrats are imbued with the authority to interpret their desires. The driving force behind the stakeholder capitalism philosophy is precisely that it creates opportunities for political actors to assert disproportionate control over the economy’s resources. Rather than create real wealth for society, politicians and bureaucrats use their social ownership of companies to extort economic resources for their purposes.
In such an environment, entrepreneurial decisions are reduced to a political process. The entrepreneur is made impotent to improve the status quo, because any intrepid decision will be vetoed by political stakeholders who fear to lose. Prices can never rise. Wage rates must always rise. Risk must be averted. Nothing must be allowed that would inconvenience the community or make anyone uncomfortable.
Recently, the most dangerous aspect of stakeholder capitalism has been its amalgamation with the climate change agenda. Any minute decision a business makes will infinitesimally affect the climate for people all over the globe. Therefore, the concept of a community stakeholder is expanded to the entire world, eliminating individual and local sovereignty. Under a climate change regime, decisions as small as remodeling an office building will be as politically charged as the ongoing Keystone Pipeline fiasco.
Clearly, many of the principles of stakeholder capitalism have been implemented in different ways for a long time, including politicized unions, regulatory schemes, and extortion of campaign contributions. But the threat to private property has also worsened in the US in recent years. In particular, politicians openly extort corporations with the threat of targeted regulation, like the Big Tech companies are facing over fake news and censorship. Socialist bureaucracies have unaccountable authority to investigate and persecute businesses, like suing petroleum companies for vague climate change damages. Large investment firms use their customers’ accounts as leverage to push politically driven reforms that are not in the financial interest of the account holders, like divesting from fossil fuels. Not to mention corporate leaders are swarming to affirm every social justice fad.
We cannot take for granted that the heart of a peaceful and prosperous economic system is respect for private ownership of property by individuals. Private property rights need to be strictly delineated in an objective and absolute way. When ownership of property is shared with “society,” as in stakeholder capitalism, there will be inexorable conflict. Because stakeholder capitalism is built on a collectivist version of property rights, free market advocates should fully denounce it.
The above originally appeared at Mises.org.
The United States Federal Reserve wire systems went down completely at around around 11:15 a.m ET, making it impossible for banks and other financial institutions to transfer money.
The interruption impacted multiple Fed services, including its pivotal automated clearinghouse system, which connects depository and related institutions send electronic credit and debt transfers.
Along with the Fed ACH service, other systems impacted included the Check 21, FedCash, Fedwire and the national settlement service.
“The Federal Reserve Bank staff is currently investigating a disruption to multiple services. We will continue to provide updates as soon as they are available,” the Fed said in a statement.
Here is the list of services impacted:
A Federal Reserve operational error resulted in disruption of service in several business lines. We are restoring services & are communicating with all Federal Reserve Financial Services customers about the status of operations.
UPDATE 2
In a notice sent to banking regulators, a Treasury Department official said the disruption “required a reboot of servers impacting all payment channels,” adding that service would be restored Wednesday afternoon.“While root cause is currently being evaluated, there is no indication that the issue is the result of a cyberattack,” the official noted.
UPDATE 4
From a Fed Alert:
The issue impacting Central Bank applications has been resolved and users may resume normal acce. The cause is a Federal Reserve operational error. We will provide updates via service status as more information becomes available. We acknowledge that payment deadlines are impacted and will communicate remediation efforts to our customers when available.
-RW
 |
| Jay Powell |
John Greenwood, chief economist at Invesco in London, and Steve H. Hanke, a professor of applied economics at Johns Hopkins University, are too polite to put on paper what they must really think of Federal Reserve Chairman Jay Powell's money printing madness, you really need to read between the lines of what they just wrote in The Wall Street Journal:
[Since February 2020,] the quantity of money in the U.S. economy, measured by M2, has increased by an astonishing $4 trillion. That’s a one-year increase of 26%—the largest annual percentage increase since 1943.
The looming danger for the economy isn’t only that the monetary printing presses have been in overdrive since the pandemic began, but also that they are already set for the same in 2021. A monetary surge for this year is locked in...
The U.S. money explosion isn’t over. Bank reserves, currently $3.2 trillion, will increase by about $1.4 trillion this year simply from Fed purchases of Treasurys and mortgage-backed securities at a promised $120 billion a month. In addition, the Treasury indicated in its February Refunding Statement that it will run down its Treasury General Account at the Fed by about $820 billion this year. This money will be spent through federal fiscal programs. These expenditures will further boost deposits counted in M2.
So we already know that the money supply will likely increase by at least another $2.3 trillion over the current year. In other words, even without any new lending or further purchases of securities by banks, the M2 money supply will grow by nearly 12% this year. That’s twice as fast as its average growth rate from 2000-19. It’s a rate that spells trouble—inflation trouble.
You don't generally find sound money advocates running the Federal Reserve Bank but Powell will likely go down in history as the most irresponsible leader of the Fed ever.
Also, it should be noted that the Fed pumpeteers, that is other Fed governors and Fed presidents of district banks, have raised no objections to the money printing.
The Fed is not going to be able to get away with what Greenwood and Hanke conservatively call "inflation trouble."
In the first phase, the money is hitting assets: the stock market, cryptocurrencies and housing.
As David Stockman recently put it:
[T]he Fed has transformed Wall Street into a giant, destructive gambling den, which is now sucking a growing share of the populace into the pursuit of instant get-rich speculations that have no chance of panning out.
Stated differently, the relevant pump and dump scheme is the one being foisted on
America by the lunatics at the Fed. You just can’t have stock market capitalizations
growing by orders of magnitude faster than national income—especially when you
measure from a starting point that was already pushing into the nosebleed section of
history.
That has clearly been the case, however, since the pre-crisis peak in Q4 2007. The
broadest measure of stock market capitalization available is the Wilshire 5000 Total
Market Full Cap index, and its up 250% since October 2007.
The consumer sector is next.
Powell and his pumpeteers claim to see no serious price inflation coming.
On Monday before the Senate Committee on Banking, Housing, and Urban Affairs, Powell said:
The economy is a long way from our employment and inflation goals, and it is likely to take some time for substantial further progress to be achieved.
The inflation "goal" Powell references is based on the bizarre idea that the Federal Reserve should have a target price inflation rate and that it should be 2.0%.
Consumer price inflation has been under 2.0%, as measured by government indexes, and so Powell and his pumpeteers believe they can average inflation up by allowing it to climb a little above 2.0%. The possibility that inflation may rapidly spike far above 2.0% given the amount of money they have already pumped into the system seems to not cross their minds.
It is as if they have been sniffing so much green ink that their logic has broken down to this:
Everything looks ok, man, and anyway, Janet Yellen's signature is about to start appearing on the currency instead of that of Steve Mnuchin. And there never has been strong price inflation when a woman has signed the currency.
So there.
-RW
Bill Gates is out with a new book, How to Avoid a Climate Disaster: The Solutions We Have and the Breakthroughs We Need.
He is hitting the talk show circuit promoting the book and the idea that the planet is headed for a major climatological disaster that will end the human species.
Setting aside as to whether or not there is some climatological disaster developing, Gates' book should really be named "How I Plan to Make Even More Billions By Getting Governments to Fund Every Mad Scheme I Have Invested In".
Gates would like for you to think of him as the sweater-wearing billionaire next door.
The only association he lists on his LinkedIn page is the Bill & Melinda Gates Foundation.
In reality, he is running vast enterprises in many sectors of the economy.
He has even invested in a company that is trying to produce lab-made "breast" milk.
He is now the owner of more farmland than anyone else in the United States:
No doubt the plan is to turn the land into producing crops that will be the ingredients of the fake hamburgers that he says rich countries must adopt.
Since he runs his operations privately, it is difficult to know everything he is invested in but it appears that everything he is promoting that is visible (along with his demands for government action) is usually tied up with massive personal investments made by him.
One sector where he has vast investments, that may be too difficult to hide since he has brought on too many billionaire buddies as partners, is the energy sector. With so many partners, something might leak so he is being a bit transparent about these investments.
He even mentions offhandedly his energy enterprise, Breakthrough Energy, in his new book and reports how he roped in his billionaire pals to join him, curiously, just before the Paris Agreement was signed:
In September, two months before the Paris conference started, I emailed two dozen wealthy acquaintances, hoping to persuade them to commit venture funding to complement the government's new money for research. Their investments would need to be long-term - energy breakthroughs that can take decades to develop – and they would have to tolerate a lot of risk. To avoid the potholes that the venture capitalists had run into, I committed to help build a focus team of experts who would vet the companies and help them navigate the complexities of the energy industry.
I was delighted by the response. The first investor said yes in less than 4 hours. By the time the Paris conference kicked off two months later, 26 more had joined, and we had named it the Breakthrough Energy Coalition. Today, the organization now known as Breakthrough Energy includes philanthropic programs, advocacy efforts, and private funds that have invested in more than 40 companies with promising ideas.
Note he is clearly talking about investments here and not non-profit donations.
So just who might be in this group that Gates summoned via email to send checks?
Breakthrough Energy lists as among its investors:
 |
| AOC with Mariana Mazzucato |
Think again.
An establishment-connected lefty professor says that in “the near future, the world may need to resort to lockdowns again — this time to tackle a climate emergency.”
“Under a ‘climate lockdown,’ governments would limit private-vehicle use, ban consumption of red meat, and impose extreme energy-saving measures, while fossil-fuel companies would have to stop drilling,” writes Mariana Mazzucato, a professor at the Economics of Innovation and Public Value Center at University College London, in a paper titled “Avoiding a Climate Lockdown.”
The title of her paper is very misleading. She believes climate lockdowns will be necessary unless we "overhaul our economic structures and do capitalism differently."
Three obstacles to overhaul must be removed, she says, "business that is shareholder-driven instead of stakeholder-driven, finance that is used in inadequate and inappropriate ways, and government that is based on outdated economic thinking and faulty assumptions." She is really talking about fascist economics, where governments set the policies of "private" sector firms:
[G]overnment assistance to business must be less about subsidies, guarantees, and bailouts, and more about building partnerships. This means attaching strict conditions to any corporate bailouts to ensure that taxpayer money is put to productive use and generates long-term public value, not short-term private profits...Because markets will not lead a green revolution on their own, government policy must steer them in that direction. This will require an entrepreneurial state that innovates, takes risks, and invests alongside the private sector.
From The New York Times:
Her message has appealed to an array of American politicians. Senator Elizabeth Warren, Democrat of Massachusetts...has incorporated Dr. Mazzucato’s thinking into several policy rollouts, including one that would use “federal R & D to create domestic jobs and sustainable investments in the future” and another that would authorize the government to receive a return on its investments in the pharmaceutical industry. Dr. Mazzucato has also consulted with Representative Alexandria Ocasio-Cortez, Democrat of New York, and her team on the ways a more active industrial policy might catalyze a Green New Deal...
Even Republicans have found something to like. In May[2019], Senator Marco Rubio of Florida credited Dr. Mazzucato’s work several times in “American Investment in the 21st Century,” his proposal to jump-start economic growth. “We need to build an economy that can see past the pressure to understand value-creation in narrow and short-run financial terms,” he wrote in the introduction, “and instead envision a future worth investing in for the long-term.”..
[A] charismatic figure in a contentious field that does not generate many stars — she was recently profiled in Wired magazine’s United Kingdom edition...Her ideas...are finding a receptive audience around the world. In the United Kingdom, Dr. Mazzucato’s work has influenced Jeremy Corbyn, leader of the Labour Party, and Theresa May, a former Prime Minister, and she has counseled the Scottish leader Nicola Sturgeon on designing and putting in place a national investment bank. She also advises government entities in Germany, South Africa and elsewhere. “In getting my hands dirty,” she said, “I learn and I bring it back to the theory...
[S]he pointed at an announcement on her laptop. She had been nominated for the first Not the Nobel Prize, a commendation intended to promote “fresh economic thinking.” “Governments have woken up to the fact the mainstream way of thinking isn’t helping them,” she said, explaining her appeal to politicians and policymakers. A few days later, she won.
The world is full of economists with very bad ideas but Mazzucato's central planning ideas are among the worst. She is filled with ideas that would result in the harassment of individuals and independent businesses. Combine this with the following she is garnering and it makes her extremely dangerous.
Enjoy your hamburgers while you can.
-RW
On "This Week in Economics with Robert Wenzel," Robert Wenzel, editor and publisher of EconomicPolicyJournal.com, takes a look at Joe Biden's stimulus package and explains how it could wreck the economy. |
| Nicola Maduro |
By Jon Miltimore
Early in 2007, after winning a second six-year term as president, Hugo Chávez announced his plan to nationalize Venezuela’s largest telecommunications company, CANTV, hinting at wider nationalization plans to come.
“All that was privatized, let it be nationalized,” announced Chávez, who had run under the banner of democratic socialism.
Nearly a decade and a half later, on the brink of mass famine and a growing energy crisis, Venezuela is now moving in the opposite direction.
According to Bloomberg News, Venezuelan president Nicolás Maduro has quietly begun transferring state assets back into the hands of private owners in an effort to reverse the country's economic collapse.
“Saddled with hundreds of failed state companies in an economy barreling over a cliff, the Venezuelan government is abandoning socialist doctrine by offloading key enterprises to private investors, offering profit in exchange for a share of revenue or products,” write Caracas-based journalists Fabiola Zerpa and Nicolle Yapur.
The transfer, which was not announced publicly but was confirmed by “nine people with knowledge of the matter,” reportedly includes dozens of coffee processors, grain silos, and hotels that were confiscated as part of Venezuela's widespread nationalization that began under Chavez.
In some ways, Venezuela's plight is the most unlikely of stories.
In 1950, Venezuela was one of the most prosperous nations in the world. It ranked among the top 10 in GDP per capita and had a labor force with higher productivity than the United States.
Venezuela’s economic growth began to stall in the mid 1970s, however, after it nationalized the petroleum sector, which resulted in a surge of government revenue and public spending. It’s estimated that Venezuela brought in $7.6 billion in 1975 alone from nationalization ($37 billion in 2021 dollars). This led to an unprecedented surge of public spending. John Polga-Hecimovich, a professor of political science at the US Naval Academy, said the Venezuelan government spent more from 1974 to 1979 than in its entire previous history.
Despite the growth in government spending, the political situation remained relatively steady. In the late 70s, University of Michigan political science professor Daniel H. Levine asserted that “Venezuelans have achieved one of the few stable competitive political orders in Latin America.”
However, Venezuela’s flirtation with socialism would eventually turn into a love affair.
In 1998, Venezuelans voted in Chavez, a populist and self-described Marxist. He was re-elected in 2000 (59.8% of the vote) and in 2006 (62.8%), at which point he began to nationalize various sectors of the economy—including agriculture, the steel industry, transportation, and mining—and confiscating more than a thousand companies, farms, and properties.
At the time of Chavez’s death, his socialist policies were heralded by Salon as an “economic miracle”—but in reality the Venezuelan economy was already in a free fall.
By 2014, with the price of oil collapsing, Maduro’s government admitted it was in severe recession and Venezuela was suffering from the highest inflation in the Americas. By January 2016, the country was on the verge of “complete economic collapse.” Not long after, the Venezuelan government abandoned any pretense of being a “democratic” regime.
A 2019 United Nations report concluded that there were “reasonable grounds to believe that” Maduro’s government had used special forces to kill thousands of political opponents in “extrajudicial executions.”
To date, it is believed that more than 5 million Venezuelans have fled the country to escape economic ruin and political oppression.
The collapse of Venezuela, once the most prosperous country in Latin America, is hardly a secret. But Maduro’s pivot toward private enterprise in an attempt to stabilize the collapsing country is a new revelation.
It’s not unprecedented, however.
“This process is similar to the privatization process in Russia in that assets are transferred to private local companies and to investors from countries allied to the government,” Asdrubal Oliveros, head of economic consultancy Ecoanalitica, told Bloomberg.
Rodrigo Agudo, head of the Venezuela Food Network, told the news agency that the regime instituted “a wild capitalism” by ceasing the collection of taxes on certain companies, liberalizing licensing on imports, and convincing military and other connected officials to invest in certain businesses.
Ramon Lobo, a lawmaker with the ruling socialist party and a former finance minister, said the arrangements tend to have time limits (usually less than 10 years) and work much like a concession. Companies are allowed to invest and manage the asset, with the government then taking a percentage.
“We believe this is positive because it is the synchronization of the public sector with the private sector,” said Lobo. “The state acts as a supervisor and receives compensation.”
In one sense, the revelation of Venezuela’s privatization push is a clear positive development.
Maduro’s effort to quietly form private-public partnerships, a strategy that began in 2017, reveals the total failure of Venezuela’s command economy. Bloomberg points out, for example, that once-successful food processing plants have been “mostly idle” since being seized by the government, plants that could have been feeding a starving population.
This revelation is both tragic and infuriating, but it’s not surprising. By their very nature, command economies are doomed to fail because they lack the basic incentive and price structures that are present in a market economy.
“It is more than a metaphor to describe the price system as a kind of machinery for registering change, or a system of telecommunications which enables individual producers to watch merely the movements of a few pointers, as an engineer might watch the hands of a few dials, in order to adjust their activities to changes of which they may never know more than is reflected in the price movement,” the Nobel Laureate economist F.A. Hayek wrote.
Many might be tempted to think that Maduro was just a bad or stupid person. But Ludwig von Mises reminds us that the quest to find the right person to run a command economy is a futile one for this very reason.
“It has not been realized that even exceptionally gifted men of high character cannot solve the problems created by socialist control of industry,” Mises observed.
It seems that after much pain and suffering, even socialist leaders in Venezuela have conceded that they cannot run an economy with enough efficiency to avoid economic ruin. But while returning enterprises to private owners is a step in the right direction, it’s hardly accurate to call Maduro's strategy “capitalism.”
The Maduro government is still using everything from price controls on food to minimum wage hikes to currency manipulation to manage its economy, not to mention selecting which businesses get to participate in its privatization efforts (and who gets to invest). In terms of overall economic freedom, Venezuela ranked 179 out of 180 countries in 2020—one place ahead of North Korea and one behind Cuba.
At best, Venezuela’s current economic system is a form of fascism, which Sheldon Richman once described as “socialism with a capitalist veneer.”
So while applauding Venezuela’s small but important step, we should not lose sight of an observation from Nobel Laureate economist Vernon Smith, who in 2018 noted that prosperity would return almost at once to Venezuela if politicians repealed their harmful policies and unleashed the power of markets.
The above originally appeared at FEE.org.
