Rum, Wool Research, and Wooden Arrows

October 3, 2008 at 6:16 pm (Banking Crisis)

As if the American people needed further evidence of what a complete sham our system of representation has become, the bailout bill passed.  In addition to the 700 billion authorization to spend tax dollars on worthless bank derivatives, the emergency bill that is so necessary to the health of the entire global financial system, that has all officials talking about the horrific doom which will occur in its absence — the magical wonder bill that is so key we’re willing to abandon free-market principles to pass — contains the following provisions (among hundreds of others):

– Manufacturers of kids’ wooden arrows – $6 million
– Puerto Rican and Virgin Islands rum producers – $192 million
– Wool research- $148 million
– Nation wide improvement in Auto-racing tracks – $128 million
– Corporations operating in American Samoa – $33 million
– Small-to medium-budget film and television productions – $10 million
– Transportation fringe benefit to bicycle riders – $10 million
– Transfer to abandoned mine reclamation fund – $9 million

Yep.  I’m not kidding.  That, folks, is how our system works.  They throw in a bunch of completely unrelated crap to buy off votes from congresspeople who support those certain issues.  Completely ridiculous.  McCain, who promised to “veto any and all bills that cross my desk with pork-barrel projects” when he is President fully supports the bailout, earmarks and all.  So, either we’re to believe he would veto the bill as President that he supports as a Senator, or… he’s a liar.  Obama is basically a marxist, so I would expect a yes vote from him.In other news, Europe is collapsing too.  The end of the Euro may be as close as the end of the dollar.  Due to the runs on banks in Greece, and a similar scenario in Ireland, these two countries have guaranteed all their peoples’ deposits.  This will either force the hand of all other EU countries to do the same, or possibly even cause a split from the euro.  Iceland is on its knees.

Here are some quotes from a century and a half ago, which ring so true today:

“These capitalists generally act harmoniously and in concert to fleece the people, and now that they have got into a quarrel with themselves, we are called upon to appropriate the people’s money to settle the quarrel.”
– Abraham Lincoln, speech to Illinois legislature, January 1837

“Every now and then the world is visited by one of these delusive seasons when “the credit system”, as it is called, expands to full luxuriance; everybody trusts everybody; a bad debt is a thing unheard of; the broad way to certain and sudden wealth lies plain and open; men are tempted to dash forward boldly from the facility of borrowing. 

Promissory notes, interchanged between scheming individuals, are liberally discounted at the banks, which become so many mints to coin words into cash; as the supply of words is inexhaustible, it may readily be supposed what a vast amount of promissory capital is soon in circulation. Everyone now talks in thousands; nothing is heard but gigantic operation in trade, great purchases and sales of real property, and immense sums made at every transfer. All, to be sure, as yet exists in promise, but the believer in promises calculates the aggregate as solid capital and falls back in amazement at the amount of public wealth, the ‘unexampled state of  public prosperity!’

Now is the time for speculative and dreaming or designing men. They relate their dreams and projects to the ignorant and credulous, dazzle them with golden visions, and set them maddening after shadows. The example of one stimulates another; speculation rises on speculation; bubble rises on bubble; everyone helps with his breath to swell the windy superstructure and admires and wonders at the magnitude of the inflation he has contributed to produce.

Speculation is the romance of trade and casts contempt upon all its sober realities. It renders the stock jobber a magician and the exchange a region of enchantment. It elevates the merchant into a kind of knight-errant, or rather a commercial Quixote. The slow but sure gains of snug percentage becomes despicable in his eyes: no ‘operation’ is thought worthy of attention that does not double or treble the investment. No business is worth following that does not promise an immediate fortune. As he sits musing over his ledger with pen behind his ear, he is like La Mancha’s hero in his study dreaming over his books of chivalry. His dusty counting-house fades before his eyes, or changes into a Spanish mine: he gropes after diamonds or dives after pearls. The subterranean garden of Aladdin is nothing to the realms of wealth that break upon his imagination.

Could this delusion always last, the life of a merchant would indeed be a golden dream; but it is as short as it is brilliant. Let but a doubt enter, and the ‘season of unexampled prosperity’ is at an end. The coinage of words is suddenly curtailed; the promissory capital begins to vanish into smoke; a panic succeeds, and the whole superstructure, built upon credit and reared by speculation, crumbles to the ground, leaving a scarce wreck behind.”
– Washington Irving during the Panic of 1837

Today’s article of doom: Senator says they were threatened privately with Martial Law in America if the bill didn’t pass today.

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