http://www.lewrockwell.com/blog/lewrw/archives/023809.html

I have just returned from our grocery store where, upon exiting, I was greeted by a young man desirous of telling me of the political virtues of Lyndon LaRouche. I was wearing a button reading “Vote No for President,” in which he took interest. When I suggested to him that politics always diminishes individual liberty, he asked for examples. I responded that wars and depressions have been used by the state to expand its controls over people. I gave, as examples, the “great depression” of the 1930s and World War II. He praised FDR for ending the depression which, I told him, did not end until after World War II came to an end, a war into which Roosevelt had manipulated American involvement. This young man then told me that it was FDR’s policies during the 1930s - of which this man approved - that made it possible for the U.S. to enter that war. “Have you thought of the implications of what you just said?,” I asked. He failed to get my point, so I asked him: “if it was the government’s expanded powers, during the New Deal, that allowed FDR to enter and conduct World War II, do you understand what I meant when I said that crises always lead to an expansion of government authority?” He asked if I thought it was wrong for the U.S. to have participated in World War II. I told him that I thought all wars are wrong. In what he must have thought was a clincher argument, he responded: “but if Roosevelt hadn’t gotten us into World War II, we would be living under a fascist government, run by big corporations.”

You can’t make up this stuff!

::sigh::

“But, but, but… but we have to control things! We can’t let people make free, independent decisions. We can’t let bad investments liquidate. People could loose their overpaid jobs!!”

For fuck sake… could someone read America’s Great Depression to them before mommy government puts them to bed at night? A chapter or two at least.

http://news.yahoo.com/…

House Speaker Nancy Pelosi said Wednesday that a $150 billion economic stimulus plan is needed now because of the faltering economy and she may call the House into session after the election to pass it.

“We may have to go back into session before the next Congress,” Pelosi said.

Pelosi said a stimulus package would create jobs by investing in public works, increasing food stamps benefits and extending unemployment insurance for the long-term jobless. She said lawmakers need to “hunker down” and look closely at the federal budget for possible savings, and reconsider whether the U.S. can afford to fight “a war without end” in Iraq.

“We have some very harsh decisions to make and some of them can’t wait until January,” said Pelosi, D-Calif.

“What we can’t wait for is a stimulus package,” Pelosi added. “We may have to go back into session before the next Congress.”

Invest? No… the government doesn’t invest. It steals or borrows and spends. Public works aren’t jobs but make work projects. Food stamps and unemployment insurance increase unemployment and will help prolong the recession.

Someone needs to tie Pelosi down, A Clockwork Orange style, and make her read America’s Great Depression, The Case Against the Fed and Economics in One Lesson.

Given the recent passage and signing of H.R. 1424, the Emergency Economic Stabilization Act of 2008, I think it’s appropriate to give Murray Rothbard’s take on what they are doing.

From America’s Great Depression, page 19 and 20:

If government wishes to see a depression ended as quickly as possible, and the economy returned to normal prosperity, what course should it adopt? The first and clearest injunction is: don’t interfere with the market’s adjustment process. The more the government intervenes to delay the market’s adjustment, the longer and more grueling the depression will be, and the more difficult will be the road to complete recovery. Government hampering aggravates and perpetuates the depression. Yet, government depression policy has always (and would have even more today) aggravated the very evils it has loudly tried to cure. If, in fact, we list logically the various ways that government could hamper market adjustment, we will find that we have precisely listed the favorite “anti-depression” arsenal of government policy. Thus, here are the ways the adjustment process can be hobbled:

1. Prevent or delay liquidation. Lend money to shaky businesses, call on banks to lend further, etc.
2. Inflate further. Further inflation blocks the necessary fall in prices, thus delaying adjustment and prolonging depression. Furthercredit expansion creates more malinvestments, which, in their turn, will have to be liquidated in some later depression. A government “easy money” policy prevents the market’s return to the necessary higher interest rates.
3. Keep wage rates up. Artificial maintenance of wage rates in a depression insures permanent mass unemployment. Furthermore, in a deflation, when prices are falling, keeping the same rate of money wages means that real wage rates have been pushed higher. In the face of falling business demand, this greatly aggravates the unemployment problem.
4. Keep prices up. Keeping prices above their free-market levels will create unsalable surpluses, and prevent a return to prosperity.
5. Stimulate consumption and discourage saving. We have seen that more saving and less consumption would speed recovery; more consumption and less saving aggravate the shortage of saved capital even further. Government can encourage consumption by “food stamp plans” and relief payments. It can discourage savings and investment by higher taxes, particularly on the wealthy and on corporations and estates. As a matter of fact, any increase of taxes and government spending will discourage saving and investment and stimulate consumption, since government spending is all consumption. Some of the private funds would have been saved and invested; all of the government funds are consumed.¹⁵ Any increase in the relative size of government in the economy, therefore, shifts the societal consumption–investment ratio in favor of consumption, and prolongs the depression.
6. Subsidize unemployment. Any subsidization of unemployment (via unemployment “insurance,” relief, etc.) will prolong unemployment indefinitely, and delay the shift of workers to the fields where jobs are available.

These, then, are the measures which will delay the recovery process and aggravate the depression. Yet, they are the time-honored favorites of government policy, and, as we shall see, they were the policies adopted in the 1929–1933 depression, by a government known to many historians as a “laissez-faire” administration.

Since deflation also speeds recovery, the government should encourage, rather than interfere with, a credit contraction.

¹⁵In recent years, particularly in the literature on the “under-developed countries,” there has been a great deal of discussion of government “investment.” There can be no such investment, however. “Investment” is defined as expenditures made not for the direct satisfaction of those who make it, but for other, ultimate consumers. Machines are produced not to serve the entrepreneur, but to serve the ultimate consumers, who in turn remunerate the entrepreneurs. But government acquires its funds by seizing them from private individuals; the spending of the funds, therefore, gratifies the desires of government officials. Government officials have forcibly shifted production from satisfying private consumers to satisfying themselves; their spending is therefore pure consumption and can by no stretch of the term be called “investment.” (Of course, to the extent that government officials do not realize this, their “consumption” is really wastespending.)

Sound familiar?

As Anthony Gregory posted over at LewRockwell.com/blog yesterday:

Now the pundits and historians are beginning to compare Bush to Hoover, for supposedly not doing enough and thus letting the collapse happen. LRC readers know the truth about Hoover, that it was his big-government response to the market crash that began prolonging and deepening the depression before FDR ever got to office.

If the hyper statist Bush regime is remembered for being too inactive, both in domestic and foreign policy, it portends bad things for the future of America and the way Americans perceive our nation’s history. As I mused on LRC back in 2004, “The worst likely outcome would have Bush going down in history the way Herbert Hoover has: a clueless, “laissez faire conservative” who refused to increase government activity sufficiently in the face of a national crisis.”

Also in one of my first articles, I wondered if any pro-war libertarians would have supported the New Deal. We might just find out.

The far left is truly deluded but truly believe Bush and company are capitalists and what they propose is free market capitalism. That what we have now is free market. That he wasn’t energetic enough. If that belief catches on with the general public we are in for far more hurt than this liquidation alone would inflict.