We Salute You, Rand Paul

Deadwood in Charge

The question on the table is whether your editor is a “dolt” for wishing for a short, sharp depression…

Writes Diary reader Steve S.:

“Bill, you’re a dolt. For some inexplicable reason you believe a system crash will “fix” everything. Why on earth would a crash do anything but make us all poor and have to start over?

Surely, you aren’t suggesting something/anything will be “learned” by the credit-happy idiots in charge that could result in a bona fide recovery.

Image credit: Warner Bros

Reading the email, we find opinions mixed. Even we can’t make up our mind. Some readers are sure that wanting a depression is just about the dumbest thing they have ever heard.

Others are more open-minded: Maybe a depression would be a good, quick, and clean way to clear out the deadwood. But we don’t really have to worry about it. The deadwood is in charge – in Washington and at central banks all around the world.

And it is not about to permit an episode of what economist Joseph Schumpeter called “creative destruction” – not when it is what needs to be destroyed. Instead, it will rage, rage, rage against the dying of the light … and cause even worse mischief.

On this subject, when we venture onto subjects other than the markets, readers will often complain. “You should stick with something you know something about,” they write. Today, we reassure dear readers that we don’t know anything about the markets either.

So, with an equal measure of ignorance, we take up a three-part series on something only distantly related to the markets: The Good, the Bad, and the Ugly. It’s a lesson in how to spot the real criminals in a world where everyone is a law-breaker.

Why vegans must be terrorists – the logic of the “national security” police state.

Cartoon by Peyyer

Fools and Knaves

What prompted this was Senator Rand Paul’s performance in the Capitol last weekend. Single-handedly, he blocked an extension of the NSA’s snooping program. You can divide Congress into two groups: the fools, who are just not clever enough to understand what is going on, and the knaves, who are too clever by half.

Between them, the cronies have a field day… duping the former and conniving with the latter. Rand Paul’s father, Ron, never fit into either group. Maybe Rand doesn’t fit either…

Rand Paul: the only major politician who actually tried to do something about keeping the burgeoning surveillance state in check

Photo credit: AP

Ron Paul couldn’t be bought. And he was smart enough to see that the do-gooders weren’t doing any good – except for themselves. If we had a beef with Ron, it was that he lacked cynicism. We often wanted to ask: What’s a nice guy like you doing in a place like this?

It was as though he didn’t see the sordid scenes going on around him… and wouldn’t stoop to notice the sleazy motives of his fellow representatives. He was always for liberty and the Constitution … and that was it. It was as though he thought he had been elected to defend the liberty of his constituent voters.

What they really wanted was something else – power, status, and other people’s money. But Ron ignored it… like one ignores the character flaws of an old friend… and continued on his lonely mission.

Surely, Rand must have learned from watching his father. But what? He grew up in a political world – full of stuffed shirts and empty heads. Did he learn how to work with this crumbly, second-rate clay and shape it into the world he and his father wanted? Or did he learn how to get along by going along… and maybe become more successful, at least in Washington’s terms, than his father?

Rand’s father Ron Paul: lone warrior in Washington and the only politician of whom it is apodictically certain that he couldn’t be bought.

Photo credit: Sean Gardner / Reuters

A Bogus Threat

We had our doubts. It seemed as though the apple had fallen… and then rolled far from the tree. But then, this past weekend, despite howls of protest, Rand did his father’s work. The Patriot Act was an embarrassment from the get-go. How could a people who valued their liberty give it up so readily?

The terrorist threat was gaudy and spectacular, but never serious. Statistically, we Americans are more likely to be killed by our own children than by terrorists. We are more likely to starve to death. Or die after tripping over furniture.

A list of probabilities (info-graphic by Meg McLain). As we have often pointed out, American furniture, electrical wiring and fair weather are far more effective in killing people than terrorists. And yet, neither are being discussed at the current G7 summit – click to enlarge.

And for every American killed by a terrorist, there are about 100 who are gunned down, run over, or tasered to death by their own police. Still, eavesdropping was sold to the public as a way to head off terrorist attacks. How many attacks did it thwart?

Zero.

The Washington Times reports:

“FBI agents can’t point to any major terrorism cases they’ve cracked thanks to the key snooping powers in the Patriot Act, the Justice Department’s inspector general said in a report Thursday that could complicate efforts to keep key parts of the law operating.

Inspector General Michael E. Horowitz said that between 2004 and 2009, the FBI tripled its use of bulk collection under Section 215 of the Patriot Act, which allows government agents to compel businesses to turn over records and documents, and increasingly scooped up records of Americans who had no ties to official terrorism investigations.”

So we salute Rand Paul. Good on you. In the long march to a police state, the feds were forced to take a small step back. This example made us think about other people doing good work. (Who says we are always negative!)

There are millions and millions of people who do good work every day. Few of them get their names in the paper. They clean their homes. They drive trucks and analyze stocks. They weld steel and teach children. The saints are all around us … unnoticed.

Identifying terrorists in the land of paranoia.

Having fun in the Hindu Kush

Cartoon by Mike Keefe

The above article originally appeared at the Diary of a Rogue Economist, written for Bonner & Partners. Bill Bonner founded Agora, Inc in 1978. It has since grown into one of the largest independent newsletter publishing companies in the world. He has also written three New York Times bestselling books, Financial Reckoning Day, Empire of Debt and Mobs, Messiahs and Markets.