Speechless.

I have a 401(k) plan. 401(k) is the section of the tax code that lets me contribute money into an account tax free (i.e., the money I put in each month is off the top, and not taxed), is allowed to grow tax free (i.e., no capital gains tax) which will eventually be taxed when I decide to take it out. My 401(k) money is invested in several mutual funds that generally invest in the stock market. I’m relatively young, and historically the stock market has produced higher returns than any other investments, so the bulk of my money is there for now. When I get older I’ll start moving my 401(k) money into safer investments, with lower returns. When you are young, you can endure short-term swings in volatile, yet higher producing, investments. When you are older, your timeframes are shorter and you are less able to endure volatility.

This is all common sense. This should be taught in 8th grade. Diversifying your investments is safer than putting all your eggs into one basket. It is not always the best choice in hindsight – I would love to have put all my money in Google at the IPO price, then sold it for gold at the high end just before Google’s latest earning report – but it is definitely the safest.

So why is the AP reporting that the growth in 401(k) funds, now with more aggregate money than “traditional” pension funds, is “a dramatic change that will force younger workers to plan more carefully for retirement”? A “traditional” pension fund is one where an employee puts all his eggs in one basket – the basket of your employer, ala Enron. This is, and has always been, foolhardy non-diversification.

United Airlines recently emerged from bankruptcy. As part of its Chapter 11 reorganization, “drastic cuts were made to the pension plans.” If every employee had invested their money in a 401(k) instead of United’s traditional pension plan, they would still have all their money because, surprise surprise, it would be their money, not some future promise of a pension. Worse, United’s employees’ union almost surely bargained for this form of compensation. It doesn’t matter one whit to your employer how he compensates you – all cash, a mix of cash and health benefits, a mix of cash, health benefits, pension plan, etc. It’s all the same to the employer. Anyone who can take all of their compensation in cash, but doesn’t, is an idiot. (When I say “cash” I include anything that one has a present property interest in, which is not subject to some future promise.)

This is essentially why we need to privatize Social Security. It is a simple legal principal – title to my retirement money should be mine. Social Security is a mere unenforceable promise by today’s politicians that tomorrow’s politicians will pay you back something resembling what you are being taxed today – or in other words, a Ponzi scheme. Since the age demographics in this country will not support such a Ponzi scheme in the very near future, you (and me) can all kiss our “promised” Social Security goodby – just as United employees kissed their “pensions” goodby.

Both Social Security and United pensions suffer from the same basic problem – lack of diversification. Both plans are utterly dependent upon one, and only one, enterprise succeeding indefinitely. Social Security’s Ponzi scheme cannot survive indefinitely. Though ignorant leftists once thought big corprations like United could never fail, this is obviously not true (TWA, Pan Am, Enron). The only way to keep your money is to keep your money – i.e., get it all under your legal control. This will not guarantee that you’ll keep all of your money, as certainly your mutual funds will occasionaly invest in stinkers like Enron. But it is far better than Social Security or a “traditional” pension.

To sum up: The AP article leads with scaremongering that 401(k)s are somehow more difficult to manage or riskier than “traditional” pensions, which is not true. From this I discern that the AP reporter is either reflexively liberal (most likely) or an ignoramus (what’s the difference? you say). 401(k)s are obviously better than “traditional” pensions, as any diversified investment plan is better than a concentrated plan. This is simple stuff, and shows why Social Security should be wholly privatized.

UPDATE: Even though no one reads this blog, I thought I should clarify one point made above. As the United bankruptcy demonstrates, employers actually do care about how they structure their compensation of their employees. Pension plans have been favorites because they allow the employer to keep the money (essentially by requiring the employees to “invest” their pension-allocated money in the employer rather than elsewhere) and are dischargeable if the employer ever files for bankruptcy. If an employer can give you a (potentially unenforceable) promise of payment later instead of cash now, well, it doesn’t take a brain surgeon to figure out that it’ll do the former. Social Security works on the same principal, except Social Security is 100% unenforceable.

This is an old blog article found on Ben’s Law.

That’s right. All proposals the Democrats are considering lead to the same dead end – socialized medicine and then health care rationing. All of this is in the name of providing health insurance for a conveniently misleading number of 50 million uninsured.

Although the Republicans are offering alternatives, once again they are being ignored by the Democratic leadership and the mainstream media. Democrats are also ignoring the pitfalls of government-run health care experienced in other countries.

When the intelligent thinkers sift through the health care hot air they find five traps that are being used to entice the American sheeple onto the road to rationing. Many of us are aware of these traps, because we remember the last time the Democrats tried to take control of the entire health care system 15 years ago.

Mandate health insurance coverage. This is how the Social Security system got started in 1935. The deductions from people’s paychecks and from their employers were mandated, because everyone deserved some assistance in their golden years, and everyone had to participate in order for it to work.

There were a few small problems along the way. Congress changed the rules, increased the amount of the deductions and started using the money for other purposes. And by the way, if your future Social Security benefits are your only means of “retiring”, your lifestyle will suffer dramatically.

A government mandate is also how Medicare got started in 1965. Look how well it’s not working. Like Social Security, the problems are being ignored.

Government health insurance will be an option. Representative Tom Price of Georgia described this trap the best. It’s like competing against a team that made the rules, and they can change the rules whenever they want to in order to give themselves a better advantage. Eventually, there will only be one option, and even the sheeple can figure that out.

Private health benefits will be taxed. This is the class warfare trap. People who have health insurance benefits being partially paid by their employer should be punished for being so lucky. We must all share in the same mediocre benefits controlled by Big Brother.

It’s free! This is the biggest and easiest trap for people who love more government programs and higher taxes, because they will most likely be on the receiving end after Uncle Sam takes more money from those greedy rich people. When the Democrats spend more time talking about how to pay for “it” – when we do not even know what “it” is – we are screwed.

It’s now or never! The fast-track timetable that the president wants will have the same consequences as the hurry-up-and-pass-it-now $787 billion “stimulus” spending bill. Namely, no one will have time to read it and know what’s in it, so the administration can make the rules up as they go.

An alternative title for this article could have been “Five ways to make health care in America worse,” because each one of these traps will create another problem that will lead to another bad solution by Congress and the president, only to be ignored into the distant future.

For Social Security and Medicare, the distant future is already here.

(Source: Herman Cain)

http://hermancain.com/news/press-opinion-061509.asp

So now, here we find ourselves out of $30,000,000,000 (I couldn’t find an exact number, this could be for both GM and Chrysler) and we’ll be paying another $30,000,000,000+ to get GM through the bankruptcy/restructuring process.  This is what happens when the government decides to stick their nose where it doesn’t belong and prop up bad business.

The only good news is that a lot of people saw it coming and made a considerable amount of money off the deal.  I’m currently playing a stock game with a thinkorswim paperMoney account I have a very short position (Gary Coleman short) on GM.  My sources tell me that a judge will decide what the common shareholders will get and the stock will be haulted.  I’m hearing that it will probably be worth ~$.10 a share.  Too bad that wasn’t real money that I had in the markets…

Oops (click for Full Size)

Someone uploaded an image today. I thought it was pretty funny so I figured I’d post it.

The small print was kind of blurry, while “change” was spelled in huge, pleasing letters on the signs they held at the rallies. The fierce urgency of now was in the air. Everybody was in such a hurry to bring about change; there was no time to ask “why” or “what kind of change.” As objectivity faded into the sunset, their individual brains melted into a euphoric collective mush, swirling around the only remaining absolute — change. In the absence of other standards, the truth became a mere matter of taste, subject to change without notice. If it didn’t change, it wasn’t the truth.

So they won the election; now what? Three months later and almost a month into Obama’s presidency, as the nation is beginning to rub its sore, swollen eyelids and finally trying to focus on reality, it looks in the mirror and, with a shock, notices a gigantic hammer and sickle tattooed on its forehead, which clearly wasn’t there before. The bubbling euphoric pulp has solidified into a depressing pile of unpaid bills and warrants. The computer has turned into a shovel and the big-screen TV into a 1930s-style radio, with the disciplined voice of Dear Leader calling for unity and sacrifice in the face of mounting economic hardships. The only thing left unchanged is the Obama t-shirt with the magic word “change” on the chest.

Being an immigrant from the former USSR — the land of equally redistributed misery — I used to cringe when Americans complained to me about the perceived misery and lack of opportunity under capitalism. I laughed at American homegrown agitators who were carping on behalf of “communities” about the lack of “economic justice.” They sounded like ignorant, spoiled brats who hated their rich parents for giving them the car of the wrong color. The whiners either didn’t realize how good they had it or they were being deliberately misleading. Either way their message was a fraud.

I had witnessed the stagnation and the collapse of a centralized command economy that, in the absence of the markets, was fueled by the carrot and stick of coercion and stale motivational slogans. I had lived through the hyperinflation, when I had to pay a million rubles to a guy who fixed the rusty refrigerator in my kitchen. I had seen the old country plunge into the chaos of mass unemployment and crime, while it was being robbed to the bone by crooked unelected officials who profited from the corrupt scheme to merge socialism and capitalism — a half-baked brainchild of Clinton’s economists who are now advising Obama.

In other words, I had been at the end of this road and I didn’t want to take it again.

Like most other immigrants in America, I had discovered a treasure trove of opportunities and was able to provide a comfortable living for my family. I wasn’t rich — but every time I would get into my GM car, turn on my HP computer, or watch a DVD from Netflix, I would give thanks for the perks that only an affluent capitalist society could provide. I didn’t want any change — except, perhaps, towards fewer government regulations.

But Obama managed to convince millions of Americans that they were so destitute and helpless that only a system of government rationing could save them from imminent starvation and homelessness. All of a sudden, previously self-reliant Americans found themselves in the position of neutered house pets, meowing and howling at the prospect of not getting their guaranteed three meals a day.

Opponents of capitalism will tell you that market demand is created, not by necessity, but by sneaky marketing campaigns that generate a false perception of necessity. The same experts have now implemented this perverted theory by running a multimillion-dollar, Madison-Avenue-style marketing campaign, whose goal was to sell to the generally well-off Americans the notion that they were living in misery, poverty, and hopelessness — thus creating a false perception of a need for change.

And change is materializing fast. Every time the new president opens his mouth, the market plunges. The banking crisis, which Obama used to get in power, was nothing compared to the post-election economic meltdown. On February 10 alone, after Treasury Secretary Geithner proposed a new economic rescue plan, the Dow lost 5% of its value. The unemployment is soaring while consumer confidence is sinking. Obama’s aggressive marketing of perceived mass poverty became a self-fulfilling prophecy. As the shadow of the New Deal is darkening the horizon and the heavy steps of the approaching depression are sending tremors throughout the world, the appeal of Obama’s plan is no longer in the eyes of the beholder.

This is where the goat comes in (in case you’re still wondering about the title). Consider this old Jewish joke I heard back in Ukraine:

A man comes to the rabbi and complains about his life:
“I have almost no money, my wife is a shrew, and we live in a small apartment with seven unruly kids. It’s messy, it’s noisy, it’s smelly, and I don’t want to live.”
The rabbi says, “Buy a goat.”
“What? I just told you there’s hardly room for nine people, and it’s messy as it is!”
“Look, you came for advice, so I’m giving you advice. Buy a goat and come back in a month.”
In a month the man comes back and he is even more depressed:
“It’s gotten worse! The filthy goat breaks everything, and it stinks and makes more noise than my wife and seven kids! What should I do?”
The rabbi says, “Sell the goat.”
A few days later the man returns to the rabbi, beaming with happiness:
“Life is wonderful! We enjoy every minute of it now that there’s no goat — only the nine of us. The kids are well-behaved, the wife is agreeable — and we even have some money!”

Obama’s “change” is precisely the goat that Americans bought when they lost the appreciation of how good they had it. But the perception of misery is not set in stone; this self-inflicted disaster may as well serve as a remedy — an unpleasant but necessary shock therapy helping the misguided voters come to their senses and begin to appreciate what they had lost. And once they get rid of the socialist goat, they will hopefully regain confidence in their own system and continue to enjoy liberty and prosperity as they always did — with the head held high and without the silliness of feeling guilty about it.

The trick is not to let the goat grow on you. Don’t settle for socialism. Capitalism may be a self-regulating system, but it won’t be able to heal itself if the socialization goes too far. Then it would be a whole different goat story.

By Ogel Atbashian

It’s bad enough for the liberal media to deify Obama, but it’s almost unbearable for right-wing commentators and politicians to jump on this bandwagon, as well, as if Obama’s personal attributes have blinded them to the policy dangers he represents.

During the Bush years, the left blamed Bush for the absence of bipartisanship, when, by any rational measure, they were the ones whose relentless vitriol made bipartisanship impossible.

Forgive the analogy, but their reversal of blame is reminiscent of a memorable scene in the movie “Animal House,” when fraternity hotshot “Otter” pressured the hapless legacy pledge, “Flounder,” into lending him his brother’s car. When Otter returned the car after having demolished it, Otter chastised Flounder for entrusting the car to him. “You (screwed) up. You trusted me.”

Now, after eight years of this poison, the same specious theme from the Bush bashers has found a new application: “Republicans must work with Barack Obama and restore a spirit of collegiality to Washington,” as if they have any moral authority to be lecturing, but even more importantly, as if a spirit of collegiality will solve America’s problems.

To be clear, I am not advocating that Republicans return the same mean-spirited partisanship with which the left pummeled Bush. But conservatives must not abandon their principles in pursuit of the seductive, illusory goal of bipartisanship.

You’d think this principle too sophomoric to articulate, and so do I — almost. But have you been listening to Republican politicians and “conservative” commentators lately behaving as if their eternal salvation depends on jumping aboard a train headed in the opposite direction from everything in which they profess to believe?

Of course the right should support Obama on things they agree with him on and never oppose him gratuitously for purely partisan reasons. Indeed, they should rejoice if Obama were to morph into a free market enthusiast, national security stalwart, champion of the unborn, and protector of our borders.

But such talk is academic, as the chances of Obama being substantively Reaganesque are less than his becoming obese, which means that during the next few years, the articulation of principled conservatism could never be more important. They must resist pressures for bipartisanship from those who will continue to use it as a weapon to intimidate principled opposition.

Perhaps a secret desire for approval from the elites and intelligentsia of the Northeast Corridor explains the squishiness of so many on the right today. Or maybe they are paranoid about appearing ever so slightly racist if they fail to extol the virtues of the first black president — no disrespect intended to Bill Clinton — even if his policies are anathema to them.

But can’t we acknowledge the positive aspects of America’s historic strides in certain aspects of race relations without surrendering to the advancement of liberalism just because the first black president is behind it?

What our government does during the next four years — maybe the next 100 days — could have a lasting impact on the future of America’s liberty, prosperity and even solvency.

Republicans are already on seriously thin ice, having presided over an era of unprecedented spending and consistently failing to articulate conservative principles on a wide variety of issues. But what Obama has in store will make President Bush appear, in retrospect, like a libertarian.

If, for the sake of appearing to work with Obama, Republicans reduce themselves to offering merely liberal lite the next four years, we’re going to have trouble recovering from the inevitable damage to which they will have contributed.

They’ve already ceded ground on the need for a “stimulus package,” though conservative realists understand that doing nothing would be far less destructive to our long-term financial health than throwing good money after bad under the illusion that the government mint is a panacea.

Will they have the courage to stand tough against the further socialization of our health care system and offering market reforms instead, even against the demagogic claims that they are without compassion for the “uninsured”? If not, they will be contributing not only to the permanent demise of America’s health care system but also to possibly the end of America’s free market tradition.

It’s one thing for Obama’s leftist cult followers to be oblivious as to the source of their giddiness, but it’s completely unacceptable for the right to be rudderless in the face of this potential juggernaut. Lord help us and this great nation if they don’t regain their moorings very soon.

(Source: David Limbaugh)

There have been some rumblings around the office about the future of this company, and more specifically, your job. As you know, the economy has changed for the worse and presents many challenges. However, the good news is this: The economy doesn’t pose a threat to your job.

What does threaten your job however, is the changing political landscape in this country. Of course, as your employer, I am forbidden to tell you whom to vote for — it is against the law to discriminate based on political affiliation, Race, creed, religion, etc.

Please vote who you think will serve your Interests the best. However, let me tell you some little tidbits of fact which might help you decide what is in your best interest. First, while it is easy to spew rhetoric that casts employers against employees, you have to understand that for every business owner there is a back story.

This back story is often neglected and overshadowed by what you see and hear. Sure, you see me park my Mercedes outside. You’ve seen my big home at last years Christmas party. I’m sure all these flashy icons of luxury conjure up some idealized thoughts about my life. However, what you don’t see is the back story.

I started this company 12 years ago. At that time, I lived in a 300 square foot studio apartment for 3 years. My entire living space was converted into an office so I could put forth 100% effort into building a company, which by the way, would eventually employ you.

My diet consisted of Ramen Pride noodles because every dollar I spent went back into this company. I drove a rusty Toyota Corolla with a defective transmission. I didn’t have time to date. Often times, I stayed home on weekends, while my friends went out drinking and partying. In fact, I was married to my business — hard work, discipline, and sacrifice.

Meanwhile, my friends got jobs. They worked 40 hours a week and made a modest $50K a year and spent every dime they earned. They drove flashy cars and lived in expensive homes and wore fancy designer clothes. Instead of hitting the Nordstrom’s for the latest hot fashion item, I was trolling through the Goodwill store extracting any clothing item that didn’t look like it was birthed in the 70′s.

My friends refinanced their mortgages and lived a life of luxury. I, however, did not. I put my time, my money, and my life into a business with a vision that eventually, some day, I too, will be able to afford these luxuries my friends supposedly had.

So, while you physically arrive at the office at 9am, mentally check in at about noon, and then leave at 5pm, I don’t. There is no “off” button For me. When you leave the office, you are done and you have a weekend all to yourself. I unfortunately do not have the freedom. I eat, ****, and breathe this company every minute of the day. There is no rest. There is no weekend. There is no happy hour. Every day this business is attached to me like a 1 day old baby.

You, of course, only see the fruits of that garden — the nice house, the Mercedes, the vacations… You never realize the back story and the sacrifices I’ve made. Now, the economy is falling apart and I, the guy that made all the right decisions and saved his money, have to bail-out all the people who didn’t.

The people that overspent their paychecks suddenly feel entitled to the same luxuries that I earned and sacrificed a decade of my life for. Yes, business ownership has is benefits but the price I’ve paid is steep and not without wounds. Unfortunately, the cost of running this business, and employing you, is starting to eclipse the threshold of marginal benefit and let me tell you why:

I am being taxed to death and the government thinks I don’t pay enough. I have state taxes. Federal taxes. Property taxes. Sales and use taxes. Payroll taxes. Workers compensation taxes. Unemployment taxes. Taxes on taxes. I have to hire a tax man to manage all these taxes and then guess what? I have to pay taxes for employing him. Government mandates and regulations and all the accounting that goes with it, now occupy most of my time. On Oct 15th, I wrote a check to the US Treasury for $288,000 for quarterly taxes. You know what my “stimulus” check was? Zero. Nada. Zilch.

The question I have is this: Who is stimulating the economy? Me, the guy who has provided 14 people good paying jobs and serves over 2,200,000 people per year with a flourishing business? Or, the single mother sitting at home pregnant with her fourth child waiting for her next welfare check?

Obviously, government feels the latter is the economic stimulus of this country. The fact is, if I deducted (Read: Stole) 50% of your paycheck you’d quit and you wouldn’t work here. I mean, why should you? That’s nuts. Who wants to get rewarded only 50% of their hard work? Well, I agree which is why your job is in jeopardy. Here is what many of you don’t understand; to stimulate the economy you need to stimulate what runs the economy. Had suddenly government mandated to me that I didn’t need to pay taxes, guess what? Instead of depositing that $288,000 into the Washington black-hole, I would have spent it, hired more employees, and generated substantial economic growth. My employees would have enjoyed the wealth of that tax cut in the form of promotions and better salaries. But you can forget it now.

When you have a comatose man on the verge of death, you don’t defibrillate and shock his thumb thinking that will bring him back to life, do you? Or, do you defibrillate his heart? Business is at the heart of America and always has been. To restart it, you must stimulate it, not kill it. Suddenly, the power brokers in Washington believe the mud of America are the essential drivers of the American economic engine.

Nothing could be further from the truth and this is the type of change you can keep. So where am I going with all this? It’s quite simple. If any new taxes are levied on me, or my company, my reaction will be swift and simple. I fire you. I fire your co-workers. You can then plead with the government to pay for your mortgage, your SUV, and your child’s future. Frankly, it isn’t my problem any more. Then, I will close this company down, move to another country, and retire.

You see, I’m done. I’m done with a country that penalizes the productive and gives to the unproductive. My motivation to work and to provide jobs will be destroyed, and with it, will be my citizenship.

While tax cuts to 95% of America sounds great on paper, don’t forget the backstory: If there is no job, there is no income to tax. A tax cut on zero dollars is zero. So, when you make decision to vote, ask yourself, who understands the economics of business ownership and who doesn’t? Whose policies will endanger your job? Answer those questions and you should know who might be the one capable of saving your job. While the media wants to tell you “It’s the economy Stupid” I’m telling you it isn’t.

If you lose your job, it won’t be at the hands of the economy; it will be at the hands of a political hurricane that swept through this country, steamrolled the Constitution, and will have changed its landscape forever. If that happens, you can find me in South Caribbean sitting on a beach, retired, and with no employees to worry about.

Signed, Your boss,

Michael A. Crowley,
PE Crowley, Crisp & Associates, Inc.
Professional Engineers 1
906 South Main Street, Suite 122
Wake Forest, NC 27587

919.562.8860 x22
919.562.8872 Fax

Behind him, the boy shuffled along, trying to imitate his grandfather, but unable to mimic the silent motion that the old man had learned during countless winter days upon this wooded mountain in pursuit of game. He’s fifteen years old, the old man thought. Plenty old enough to be learning. But that was another time, another America. His mind drifted, and he saw himself, a fifteen-year-old boy following in the footsteps of his own grandfather, clutching a twelve gauge in his trembling hands as they tracked a wounded whitetail.
The leg was hurting worse now, and he slowed his pace a bit. Plenty of time. It should have been my own son here with me now, the old man thought sadly. But Jason had no interest, no understanding. He cared for nothing but pounding on the keys of that darned computer terminal. He knew nothing about the woods, or where food came from…or freedom. And that’s my fault, isn’t it?

The old man stopped and held up his hand, motioning for the boy to look. In the small clearing ahead, the deer stood motionless, watching them. It was a scraggly buck, underfed and sickly, but the boy’s eyes lit up with excitement. It had been many years since they had seen even a single whitetail here on the mountain. After the hunting had stopped, the population had exploded. The deer had eaten the mountain almost bare until erosion had become a serious problem in some places. That following winter, three starving does had wandered into the old man’s yard, trying to eat the bark off of h is pecan trees, and he had wished the “animal rights” fanatics could have been there then. It was against the law, but old man knew a higher law, and he took an axe into the yard and killed the starving beasts. They did not have the strength to run.

The buck finally turned and loped away, and they continued down the trail to the river. When they came to the “Big Oak,” the old man turned and pushed through the heavy brush beside the trail and the boy followed, wordlessly. The old man knew that Thomas was curious about their leaving the trail, but the boy had learned to move silently (well, almost) and that meant no talking. When they came to “Coffin Rock,” the old man sat down upon it and motioned for the boy to join him.

“You see this rock, shaped like a casket?” the old man asked. “Yes sir.” The old man smiled. The boy was respectful and polite. He loved the outdoors, too. Everything a man could ask in a grandson ….or a son.

“I want you to remember this place, and what I’m about to tell you. A lot of it isn’t going to make any sense to you, but it’s important and one day you’ll understand it well enough. The old man paused. Now that he was here, he didn’t really know where to start.

“Before you were born,” he began at last, “this country was different. I’ve told you about hunting, about how everybody who obeyed the law could own guns. A man could speak out, anywhere, without worrying about whether he’d get back home or not. School was different, too. A man could send his kids to a church school, or a private school, or even teach them at home. But even in the public schools, they didn’t spend all their time trying to brainwash you like they do at yours now.” The old man paused, and was silent for many minutes. The boy was still, watching a chipmunk scavenging beside a fallen tree below them.

“Things don’t ever happen all at once, boy. They just sort of sneak up on you. Sure, we knew guns were important; we just didn’t think it would ever happen in America. But we had to do something about crime, they said. It was a crisis. Everything was a crisis! It was a drug crisis, or a terrorism crisis, or street crime, or gang crime. Even a ‘health care’ crisis was an excuse to take away a little more of our rights.” The old man turned to look at his grandson.

“They ever let you read a thing called the Constitution down there at your school?” The boy solemnly shook his head. “Well, the Fourth Amendment’s still in there. It says there won’t be any unreasonable searches and seizures. It says you’re safe in your own home.” The old man shrugged. “That had to go. It was a crisis! They could kick your door open any time, day or night, and come in with guns blazing if they thought you had drugs …or later, guns. Oh, at first it was just registration — to keep the guns out of the hands of criminals! B ut that didn’t work, of course, and then later when they wanted to take ‘em they knew where to look. They banned ‘assault rifles’, and then ‘sniper rifles’, and ‘Saturday night specials.’ Everything you saw on the TV or in the movies was against us. God knows the news people were! And the schools were teaching our kids that nobody needed guns anymore. We tried to take a stand, but we felt like the whole face of our country had changed and we were left outside.”

“Me and a friend of mine, when we saw what was happening, we came and built a secret place up here on the mountain. A place where we could put our guns until we needed them. We figured some day Americans would remember what it was like to be free, and what kind of price we had to pay for that freedom. So we hid our guns instead of losing them.”

“One fellow I knew disagreed. He said we ought to use our guns now and stand up to the government. Said that the colonists had fought for their freedom when the British tried to disarm them at Lexington and Concord. Well, he and a lot of others died in what your history books call the ‘Tax Revolt of 2008,’ but son, it wasn’t the revolt that caused the repeal of the Second Amendment like your history book says. The Second Amendment was already gone long before they ever repealed it. The rest of us thought we were doing the right thing by waiting. I hope to God we were right.”

“You see, Thomas. It isn’t government that makes a man free. In the end, governments always do just the opposite. They gobble up freedom like hungry pigs. You have to have laws to keep the worst in men under control, but at the same time the people have to have guns, too, in order to keep the government itself under control. In our country, the people were supposed to be the final authority of the law, but that was a long time ago. Once the guns were gone, there was no reason for those who run the government to give a darn about laws and constitutional rights and such. They just did what they pleased and anyone who spoke out…well, I’m getting ahead of myself.”

“It took a long time to collect up all the millions of firearms that were in private hands. The government created a whole new agency to see to it. There were rewards for turning your friends in, too. Drug dealers and murderers were set free after two or three years in prison, but possession of a gun would get you mandatory life behind bars with no parole.

“I don’t know how they found out about me, probably knew I’d been a hunter all those years, or maybe somebody turned me in. They picked me up on suspicion and took me down to the federal building.”

“Son, those guys did everything they could think of to me. Kept me locked up in this little room for hours, no food, no water. They kept coming in, asking me where the guns were. ‘What guns?’ I said. Whenever I’d doze off, they’d come crashing in, yelling and hollering. I got to where I didn’t know wh ich end was up. I’d say I wanted my lawyer and they’d laugh. ‘Lawyers are for criminals’, they said. ‘You’ll get a lawyer after we get the guns.’ What’s so funny is, I know they thought they were doing the right thing. They were fighting crime!”

“When I got home I found Ruth sitting in the middle of the living room floor, crying her eyes out. The house was a shambles. While I was down there, they’d come out and took our house apart. Didn’t need a search warrant, they said. National emergency! Gun crisis! Your grandma tried to call our preacher and they ripped the phone off the wall. Told her that they’d go easy on me if she just told them where I kept my guns.” The old man laughed. “She told them to go to heck.” He stared into the distance for a moment as his laughter faded.

“They wouldn’t tell her about me, where I was or anything, that whole time. She said that she’d thought I was dead. She never got over that day, and she died the next December.”

“They’ve been watching me ever since, off and on. I guess there’s not much for them to do anymore, now that all the guns are gone. Plenty of time to watch one foolish old man.” He paused. Beside him, the boy stared at the stone beneath his feet.

“Anyway, I figure that, one day, America will come to her senses. Our men will need those guns and they’ll be ready. We cleaned them and sealed them up good; they’ll last for years. Maybe it won’t be in your lifetime, Thomas. Maybe one day you’ll be sitting here with your son or grandson. Tell him about me, boy. Tell him about the way I said America used to be.” The old man stood, his bad leg shaking unsteadily beneath him.

“You see the way this stone points? You follow that line one hundred feet down the hill and you’ll find a big round rock. It looks like it’s buried solid, but one man with a good pry bar can lift it, and there’s a concrete tunnel right under there that goes back into the hill. ”

The old man stood, watching as the sun eased toward the ridge, coloring the sky and the world red. Below them, the river still splashed among the stones, as it had for a million years. It’s still going, the old man thought. There’ll be someone left to carry on for me when I’m gone. It was harder to walk back. He felt old and purposeless now, and it would be easier, he knew, to give in to that aching heaviness in his left lung that had begun to trouble him more and more. Darn cigarettes, he thought. His leg hurt, and the boy silently came up beside him and supported him as they started down the last mile toward the house. How quiet he walks, the old man thought. He’s learned well.

It was almost dark when the boy walked in. His father looked up from his paper. “Did you and your granddad have a nice walk?”

“Yes,” the boy answered, opening the refrigerator. “You can call Agent Goodwin tomorrow. Gramps finally showed me where it is.”

Years Later…
Thomas sat alone upon the cold stone, shivering slightly in the chilly pre-dawn air of this April morning. The flashlight was turned off, resting beside him on the bare granite of Coffin Rock, and involuntarily he strained his eyes in the gray non-light of the false dawn, trying to make out the shapes of the trees, and the mountains across the river. Below, he could hear the chuckling of the water as it crossed the polished stones. How many times had he fished there, his grandfather beside him.

He tried to shrug away the memories, but why else had he come here except to remember.1 Perhaps to escape the inevitable confrontation with his mother. She would have to be told sooner or later, but Thomas infinitely preferred later.

“Mom, I’ve been expelled from the university, he said aloud in a conversational tone. Some small night animal, startled by the sudden sound, scurried away to the right. “I know this means you won’t get that upgrade to C-3, and they’ll probably turn you down for that surgery now. Gee, Mom, I’m sorry.” It sounded so stupid. “Why?” she would ask. “How?”

How could he explain that? The endless arguments. The whispered warnings. The subtle threats. Dennis had told him to expect this. Dennis had lost his parents back in the First Purge back in 2004, and his bitter hatred of the State’s iron rule had failed to ruin him only because of his unique and accomplished abilities as an actor. Only with Thomas did he open up. Only with Thomas did he relate the things he had earned while in the Youth Reeducation Camp near Charleston. Thomas shuddered.

It was his own fault, he knew. He should have kept his mouth shut like Dennis told him. All of his friends had come and shook his hand and pounded him on the back. “That’s telling them, Adams!” they said. But their voices were hushed and they glanced over their shoulders as they congratulated him. And later, when the “volunteers” of the Green Ribbon Squad kicked his ass all over the shower room, they had stood by in nervous silence, their faces turned away, their eyes averted, and their tremulous voices silent.

He sighed. Could he blame them. He’d been afraid too, when the squad walked up and surrounded him, and if he could have taken back those proud words he would have. Anyone is afraid when they can’t fight back, he’d discovered. So they taught him a lesson, and he had expected it to end there. But then yesterday had come the call to Dr. Morton’s office, and the brief hearing that had ended his career at the university. “Thomas,” Morton had intoned, “You owe everything to the State.”

Thomas snorted.

The light was growing now. He could see the pale, rain-washed granite in the grayness as if it glowed. Coffin Rock was now a knob, a raised promontory that jutted up from a wide, unbroken arm of the mountain’s stony roots, its cover of soil pushed away. There were deep gouges scraped across the surface of the rock where the backhoe had tried, vainly, to force the mountain to reveal its secrets. He was too old to cry now, but Thomas Adams closed his eyes tightly as he relived those moments that had forever changed his life.

The shouts and angry accusations as the agents found no secret arms cache still seemed to ring in his ears. They had threatened him with arrest, and once he had thought the government agent named Goodwin would actually strike him. At last, though, they had accepted defeat and turned down the mountain, following the gashed trail of the back-hoe as it rumbled ahead through the woods.

At home, he had found his mother and father standing, ashen faced, in the doorway.

“They took your grandpa,” hi s father said in disbelief. “Just after you left, they put him in a van and took him. ”

“But they said they wouldn’t!” Thomas had shouted. He ran across the yard to the old man’s cottage. The door was standing open and he wandered from room to room calling for the grandfather he would never see alive again.

It was his heart, they said. Two days after they had taken him, someone called and tersely announced that the old man had died at the indigent clinic a few hours after his arrest “Sorry,” the faceless voice had muttered. Thomas had wept at the funeral, but it was only in later years that he had come to understand the greatest tragedy of that day-that the old man had died alone, knowing that his own grandson had betrayed him.

That grandson was Thomas Adams, and he was now too old to cry but in the growing light of the cold mountain dawn, he did anyway.

Thomas was certain that his father’s de-certification six months later was due to the debacle in the forest. As much as anyone did these days, they had “owned” their home, but the Certification Board would still have evicted them except for the intervention of Cousin Lou, who worked for the State Supervisor. As it was, they lost all privileges and, when his father came down with pneumonia the next autumn, medical treatment was denied. He had died three days after the first anniversary of Grandpa’s death.

Thomas had been sure that he would be turned down at the University, but once again his cousin had intervened and a slot had “opened” for him. But now that’s finished he reflected He would be unable to obtain any certification other than manual laborer. “Why didn’t I keep my mouth shut” he asked the morning stillness. In a tree behind him, a mockingbird began to sing its ageless song, and as if in answer, the forest below began to twitter and chirp with the voices of other birds, greeting the new day.

No, what he had said had been the truth and nothing could change that. The State was wrong. It was evil. It was unnatural for men to be slaves of their government, always skulking, always holding their tongues lest they anger The State. But there is no “State,” Thomas considered. There are only evil men, holding power over other men. And anyone who speaks out, who dares to challenge that power, is crushed.

If only there was a way to fight back!

Thomas shifted on the stone, hanging his feet off the downhill side. His feet had almost touched the grass that day, but now, although his legs were certainly longer, it was at least ten inches to the scarred rock surface below. As he kicked his heels back and forth, he could almost hear h is grandfather speaking to him from long ago…

“One day, America will come to her senses. Our men will need those guns and they’ll be ready. We cleaned them and sealed them up good’ they’ll last for years. Maybe it won’t be in your lifetime, Thomas. Maybe one day you’ll be sitting here with your son or grandson. Tell him about me, boy. Tell him about the way I said America used to be.

“You see the way this stone points.” the old man was saying. “You follow that line one hundred feet…” Thomas’ heels were suddenly still. For many minutes he did not move, playing those words over and over in his mind. “…Follow that line…”

What hidden place in his brain had concealed those words all of these years. How could the threats have failed to dislodge it. He stood upon shaky legs and climbed down from Coffin Rock. In his mind’s eye, he could see the old man pointing and he walked down the hill and through a clinging brier patch, counting off the paces. The round stone did seem sol idly buried, but he scratched around near the base and found that the rock ended just an inch or so beneath the surface. “One man with a good bar ca n lift it,” Grandfather had said. Thomas forced his fingers beneath the stone and, with all the strength in his 21-year-old body, he lifted. The stone came up, and he slid it off to one side. Cool air drifted up from the dark opening in the mountain. Thomas looked to the right where the scars of the State’s frustration ended, only 15 or 20 feet away. They had been that close.

He squatted and stared into the darkness and then remembered his flashlight. In a moment, he was back with it, probing into the darkness with the yellow beam. There was a small patch of moisture just inside, but then the tunnel climbed upwards toward the ridge. On hands and knees, he entered.

It was uncomfortably close for the first 20 feet or so, then the cavern opened up around him. The men who had built this place, he saw, had taken a natural crevice in the granite rock, sealed it with masses of poured concrete, and then covered it with earth. The main chamber was bigger than the living room of a house, and they had left an opening up near the peak of the vaulted roof where fresh air and a faint, filtered light entered.

Wooden boxes and crates were stacked everywhere on concrete blocks, up off of the floor, stenciled with legends like, RIFLE, CAL. 30 M1, 9MM PARA, M193 BALL, 7.62 x 39MM, and 5.56MM. He pushed between them and crawled to the wall where he found cardboard boxes wrapped with plastic sheeting. They were imprinted with strange names like CCI, OLIN, WW748, BULLSEYE, and RL 550B.

He did not know what the crates and boxes contained, and was afraid to break the seals, but near the center of the room he found a plastic-wrapped carton labeled, “OPEN THIS FIRST”. With his penknife, he slit the heavy plastic wrapping.

It contained books, he saw with some disappointment. But he studied the titles and found that they were manuals on weapons and how to repair them, how to clean them, how to fire them, and am munition…how to store it, and how to reload it. And here was something unusual’ A History of the United States. He lifted it from the carton and crawled back to the open air. Leaning against a stone, he tore open the heavy vinyl bag that enclosed the book and began to read at random, flipping the pages every few moments. On each page, something new met his eye, contradicting everything he had ever been taught.

Freedom is not won, he learned, by proud words and declarations.

He remembered a quotation taught at the University’ “Blood alone moves the wheels of history.” An Italian dictator named Mussolini had said that, but now he read of a man named Patrick C Henry who said, “The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants.” Mao was required reading at the University, too, and he now recalled that this man called a “hero” by The State – had once said, “Political power comes out of the barrel of a gun.”

Freed om is never granted, it is won. Won by men who are willing to die, willing to lose everything so that others may have the greatest possession of all: liberty.

Mentally, he began to list those he could trust. Men who had been arrested for speaking out. Women whose husbands had been arrested and never returned. Friends who had been denied certification because of their fathers’ military records. The countryside seethed with anger and frustration. These were people who longed to be free, but who had no means to resist…until now.

Thomas laid the book aside and then worked the stone back into position, carefully placing leaves and moss around the base to hide any evidence that it had been disturbed. He tucked the book under his arm and started for home with the rays of the rising sun warming his back. He imagined his grandfather’s touch in the heat. A forgiving touch.

A long, hard struggle was coming, and he knew with a certainty that defied explanation that he would not live to see the day America would once again be free. His blood and that of many patriots and tyrants would be spilled, but perhaps America’s tree of Liberty would live and flourish again.

There is a long line stretching through the history of this world a line of those who valued freedom more than their lives. Thomas Adams now took his place at the end of that column as he determined that he would have liberty, or death. He would be in good company.

Sunrise at Coffin Rock is a work of fiction by Raymond K. Paden.

This story originally appeared in “The Blue Press” (a catalog/magazine put out by Dillon Precision Products, Inc., 7442 Butherus Drive, Scottsdale, AZ 85260, phone 602- 948-8009.) The editor, Mark Pixler, was kind enough to allow distribution on the Internet.

This story may be reprinted as long as due credit is given to the author and publisher.

I sometimes wonder if The New York Times is secretly in league with the country’s dentists. All the teeth grinding our former paper of record occasions must be good for those in the business of capping and crowning teeth. Consider, to take only the most recent example that comes to hand, the long piece in yesterday’s business section about who or what caused the current economic crisis.

I’ll tell you in a moment who really caused it, but let’s play a game. Your mission, should you choose to accept it, is to guess whom the Times would nominate as the prime mover and scapegoat-in-chief in the global financial dégringolade we’ve been living through. Ready? You have 10 seconds to come up with the answer. . . .

OK. Time’s up. Those of you who said “Ronald Reagan” or “Margaret Thatcher” get honorable mention, but you’re still playing last week’s game. No, it should be obvious to all comers that the only possible answer to any question involving political or economic failure is George W. Bush.

That’s right, folks. It was all George’s fault. Well, if you are Times reader (which is not the same thing as someone who happens to read the Times), you already knew that. Everything is Bush’s fault.

In the great contest to determine the worst Times story ever, many, so many, are called, but few are chosen. To make it to the zenith of awfulness, a Times story must not only be factually distressed, it must also achieve that tone of absolute smugness that perfectly reflects and soothingly reinforces the self-righteous sensitivities of its readership. I wrote about one example last January when the Times, in its best more-in-sorrow-than-in-anger pulpit strains ran a story about the high homicide rates of veterans returning from Iraq. Oh dear. The brutality of war. The awfulness of Iraq. George Bush. It all added up to a psychic catastrophe. Across the US, towns and cities would need to brace themselves for homicidal rampages as returning Vets went berserk.

Alas for the story, it turned out the the homicide rate among Vets was far lower than that of the general population, a titdbit that the Times neglected to mention. At the time, I asked “Why does anyone believe The New York Times about anything, ever?“, a question no one has yet answered to my satisfaction.

But one of the things that made that story about the Killer Vets so perfect a Times story was its tone. Pseudo concern underwritten by smug knowingness. That’s the recipe. Yesterday’s story about how the global economic crisis is all Bush’s fault comes from the same kitchen. It’s an exercise in histrionics, partly. The Times presents the story as it it were staging a Stephen King movie: Title: “The Reckoning.” Episode one: “White House Philosophy Stoked Mortgage Bonfire.” Starring George W. Bush as the incarnation of evil. The story opens with a large picture of the President smiling in front of sign reading in huge letters “A Home of Your Own.” For those slow on the uptake, there is also this epigraph:

“We can put light where there’s darkness, and hope where there’s despondency in this country. And part of it is working together as a nation to encourage folks to own their own home.”

– President Bush, Oct. 15, 2002

The Times allows that “there are plenty of culprits” and mentions “lenders who peddled easy credit, consumers who took on mortgages they could not afford and Wall Street chieftains who loaded up on mortgage-backed securities without regard to the risk.” But–and here comes the gravamen of the piece–”But the story of how we got here is partly one of Mr. Bush’s own making, according to . . .” Well, according to the cheery-picked people the Times assembled in this preposterous, factually-challenged indictment of the the President.

A few months ago in this space, I asked “Who caused ‘the biggest financial crisis since the Great Depression?‘” The answer, in brief, is the utopian policies of left-wing Democrats who required banks to lend money to people who could not–or would not–pay it back.

Let’s go through it again, step by step:

The Root Cause

• According to Senator Chris Dodd (D. CT) the “root cause” of the problem is “the housing foreclosure crisis.”

Not 100% accurate, perhaps–it’s really a credit crisis–but close enough for government work, especially from someone who has just happens to chair the Senate Banking Committee and who, completely coincidentally, has been such a conspicuous beneficiary of preferential mortgages and who, also coincidentally, leads the list of those who have received campaign contributions from Fannie Mae and Freddie Mac. (Guess who comes in 2nd and 3rd?)

• But what caused the housing crisis to which Senator Dodd alludes? The housing “bubble.”
• And what caused the housing bubble? “Sub-prime,” i.e., risky, mortgages; that is, mortgages made to people who, in the normal course of things would have to pay a premium in order to obtain a mortgage (if they could obtain one at all) because

1. they had bad or non-existent credit
2. their income was insufficient or
3. both.

Packaging the American Dream

A home of your own. It’s part of the American dream. Work hard, save up for a down payment, pay your bills on time and, presto, you, too, can buy a home.

For decades the government has done things to help Americans to realize the dream, e.g., graciously allowing citizens to keep some of their own money to help pay for the interest on a mortgage (the official term for this is a “tax deduction,” but I prefer my locution since it emphasizes the fact that it is YOUR MONEY we are talking about).

But what about people who do not work hard (if they work at all)? What about people who have not saved up for a down payment? What about people who do not pay their bills on time (if they pay them at all)? Why shouldn’t they get to live the American dream?

That was the question that led to (drum roll, please)

“The Community Reinvestment Act” (see here for more).

• The original Community Reinvestment Act was signed into law in 1977 by Jimmy Carter. Its purpose, in a nutshell, was to require banks to provide credit to “under-served populations,” i.e., those with poor credit.

The buzz word was “affordable mortgages,” e.g., mortgages with low teaser-rates, which required the borrower to put no money down, which required the borrower to pay only the interest for a set number of years, etc.

• In 1995, Bill Clinton’s administration made various changes to the CRA, increasing “access to mortgage credit for inner city and distressed rural communities,” i.e., it provided for the securitization, i.e. public underwriting, of what everyone now calls “sub-prime mortgages.”

Bottom line? It forced banks to issue something on the order of $1.5 trillion in sub-prime mortgages.

$1.5 trillion, i.e., one and a half thousand billion dollars in sub-prime,i.e., risky, mortgages, in order to push this latest example of social engineering.

But wait: how did it force banks to do this? Easy. Introduce a federal requirement that banks make the loans or face penalties. As Howard Husock, writing in City Journal way back in 2000 observed: “Bank examiners would use federal home-loan data, broken down by neighborhood, income group, and race, to rate banks on performance. There would be no more A’s for effort. Only results—specific loans, specific levels of service—would count.” Way back in 1994, for example, Barack Obama sued Citibank on behalf of a client who charged that the bank “systematically denied mortgages to African-American applicants and others from minority neighborhoods.”

• In 1997, Bear Stearns –- O firm of blessed memory –- was the first to get onto the sub-prime gravy train.
• Fannie Mae & Freddy Mac — were there near the beginning, too.

Anatomy of a bubble

Step 1. The intoxication: “My house is worth millions!” From 1995 – 2005, the number of sub-prime mortgages skyrocket. So did the house prices.

Step 2. The hangover: “Oh my God, my house isn’t selling. What went wrong?”

Why didn’t someone try to stop it?

Someone did: “The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago,” The New York Times, September 11, 2003.

But someone intervened to stymie the Bush administration. Who? The New York Times reports:

Supporters of the companies said efforts to regulate the lenders tightly under those agencies might diminish their ability to finance loans for lower-income families. . . . “These two entities — Fannie Mae and Freddie Mac — are not facing any kind of financial crisis,” said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. “The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.”

Why didn’t someone else ring the alarm?

Someone else did. In 2005, John McCain co-sponsored the “Federal Housing Enterprise Regulatory Reform Act,” which among other things provided for more oversight of Freddie & Fannie. The bill didn’t pass. Guess who blocked it?

The bill was reintroduced in 2007. But again, no luck. Fannie Mae and Freddie Mac had friends in the Senate:

• Chris Dodd, a recipient of “sweetheart” loans from a Freddie and Fannie backed company.
• The junior senator from Illinois, i.e., Barack Obama, who turned to Jim Johnson, former head (1991-1998) of Fannie Mae, to help advise him on whom to pick for the vice-presidential slot on his ticket. From 1985 to 1990, incidentally, Johnson was managing director of Lehman Brothers. Remember them?
• You might also want to check out one of Barack Obama’s other advisors: Franklin Raines, former CEO of Freddie Mac: see here , for example, or here, or here. (And thanks again to this great video for the outline I précis above.)

The dog that didn’t bark.

Perhaps the most amazing thing about the Times’s little drama that casts George Bush as the protagonist of our economic tragedy is not what’s in it but what isn’t. You will search in vain for the name “Barney Frank” or the phrase “Community Reinvestment Act.” But telling the story of our economic crisis with out those elements is like staging Macbeth without Macbeth or the witches.

There is a great refusal in operation here, a refusal to face up to facts. Thomas Sowell touched on this in a typically percipient column a few months ago when he wondered, not without exasperation, whether facts still mattered in our political life. The current economic crisis seems to have benefitted Democrats. But how could that be? Sowell reminds us of some forgotten facts:

Fact Number One: It was liberal Democrats, led by Senator Christopher Dodd and Congressman Barney Frank, who for years –- including the present year -– denied that Fannie Mae and Freddie Mac were taking big risks that could lead to a financial crisis.

It was Senator Dodd, Congressman Frank and other liberal Democrats who for years refused requests from the Bush administration to set up an agency to regulate Fannie Mae and Freddie Mac.

It was liberal Democrats, again led by Dodd and Frank, who for years pushed for Fannie Mae and Freddie Mac to go even further in promoting subprime mortgage loans, which are at the heart of today’s financial crisis.

Alan Greenspan warned them four years ago. So did the Chairman of the Council of Economic Advisers to the President. So did Bush’s Secretary of the Treasury, five years ago.

Yet, today, what are we hearing? That it was the Bush administration “right-wing ideology” of “de-regulation” that set the stage for the financial crisis. Do facts matter?

None of this is new. But Gide was right: although everything has already been said, no one was listening, so it is always necessary to start over again. Go into your local bank. Look around. Somewhere you’ll see posted on the wall a notice advising customers that the bank’s lending practices follow the dictates of the Community Reinvestment Act and that federal bureaucrats regularly stop by to make sure the bank is abiding by its ruinous stipulations. When will it stop?