Category: moral hazard

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free trade & free markets moral hazard

Is It Still Capitalism?

capitalism, mixed economy, socialism, corporation, bank

Is it still capitalism if the capital is guaranteed?

“The U.S. government will guarantee all customer funds in Silicon Valley Bank (SVB) after a series of bad decisions and a run on deposits led to the bank’s collapse,” explains Elizabeth Nolan Brown in Reason. 

Technically, the bank isn’t being bailed out. Its customers are. And that’s a lot more popular than bailing out banks directly. There are more bank customers who vote than bankers who vote — though there is probably more political donations from banks directly seeking banking policy “correctives” than bank customers doing the same. That’s almost apodictically true.

The most bizarre element? While the FDIC, the federal agency that insures depositors of this and similar banks, is designed to guarantee depositors’ capital up to a certain limited amount ($250,000, more or less), the regulatory triumvirate of Treasury Secretary Janet Yellen, Federal Reserve Board Chair Jerome Powell, and FDIC Chair Martin Gruenberg declare that “all depositors of this institution will be made whole.” 

All.

Even the super-rich.

The key concept, here, is moral hazard — “The decision creates bad incentives for financial institutions and their customers” is how Ms. Brown puts it. We’ve been through all of this before. Is there really any question? The answers are in.

So, to the opening, Is it still capitalism if the capital is guaranteed? — if even Prince Harry’s fortune will be guaranteed — the answer is No.

Sorta. 

It’s a special kind of capitalism. State-dominated capitalism; Neo-mercantilism; f***-ism. Use whichever term.

As we contemplate a profit-and-loss system without loss, and how the losses will be made up within the financial system, just remember that the federal government playing the role of Savior is not itself costless, and . . . its debt keeps growing. And the Ultimate Result of all this still looms.

Immoral hazard.

This is Common Sense. I’m Paul Jacob.

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crime and punishment general freedom international affairs moral hazard

Thank Omicron? Or Hypocrisy?

Britain’s Prime Minister Boris Johnson, covid, masks, mandates

It was not immediately clear what had changed regarding “the science,” when, midweek, Britain’s Prime Minister Boris Johnson lifted the Queen’s government’s mask mandates and other coronavirus restrictions.

The case for and against mask efficacy has been about the same for a very long time. There’s no obvious statistical evidence for mask mandates working. And pre-2020 studies showed ambiguous results for preventing virus transmission by wearing masks — and certainly not for the cloth masks most people wear.

So what changed?

Well, Johnson cited the omicron variant. “Our scientists believe that the omicron wave has now peaked nationally,” he said, adding that hospital admissions had stabilized and that London admissions were falling. 

So he lifted mask requirements in schools, too.

This takes some pressure off him. The vast majority of Brits are tired of masks, especially on students.

Predictably, however, some school masters appear to be clinging to the cloth. 

Regardless, why the change?

Spokespersons for the beleaguered opposition party, Labour, argue it’s mostly political, since Boris was caught at two bigwig parties where no one was wearing masks. “Can the PM share the evidence,” asked one, “behind his decision and that he’s not just protecting his job?” 

And Johnson says that “the scientific evidence is there for everybody to consult” — but, face it, everything these politicians say is half-assessed and untrustworthy.

Still, at least the people of Britain will receive a little let-up from the oppressive “scientific” tyranny of their government.

Not all states to the west of the Atlantic can say the same.

This is Common Sense. I’m Paul Jacob.

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government transparency moral hazard national politics & policies partisanship

The Secret of the Second Impeachment

Assange, Snowden, Trump, impeachment

The impeachment that followed the events of January Sixth was . . . peculiar. President Trump had just a few weeks to go in his term, thus “removing him” on the way out seemed . . . almost pointless. 

And we quickly learned that the Senate wouldn’t hear the case until after Trump’s replacement was installed in office.

So why?

Had enough Republicans in the upper chamber jumped ship, what House Democrats would have obtained for their troubles was (1) a prohibition on Trump running again and (2) a twist of the knife.

Key word: Payback.

Democrats had never really “accepted” their defeat in 2016. So they played up Trump’s unwillingness to “accept defeat” in 2020. A poetic revenge — “with a twist.”

But this may have been more than merely partisan payback. 

Here’s the proverbial Rest of the Story: The lame duck president had been seriously considering pardoning Edward Snowden and Julian Assange. And that was something the permanent government of the intel agencies and military-industrial complex could not allow. So, as Glenn Greenwald reported on Rumble, the Deep State’s most ardent Republican supporters in the Senate — Lindsay Graham being most prominent — threatened to vote against Trump in the impeachment proceedings if the president pardoned either of those . . . heroes.

By impeaching Trump, Democrats not only humiliated the man, to the extent he could be humiliated, they scored a political win against Snowden and Assange, two men who had humiliated the establishment in general and their party in particular.

The big winner? The Deep State.

And the real loser? Not Trump — the American people.

Because we are left with a Leviathan that spies on us and lies to us.

This is Common Sense. I’m Paul Jacob.

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First Amendment rights general freedom media and media people moral hazard nannyism social media

Tom Paine Sues Facebook

Thomas Paine, truth, offense, censorship

The ghost of Thomas Paine is suing Instagram and Facebook.

Mr. Paine, the eloquent champion of the American Revolution who penned such zeitgeist-capturing volumes as Common Sense, The American Crisis, and The Rights of Man, is going to court to protest the indignity that these social-media forums recently inflicted upon his spirit by censoring his statement that “He who dares not offend cannot be honest.”

The statement comes from an op-ed Paine published in the April 24, 1776 issue of the Pennsylvania Journal: “Cato’s partizans may call me furious; I regard it not. There are men too, who, have not virtue enough to be angry, and that crime perhaps is Cato’s. He who dares not offend cannot be honest.”

Mr. Paine seems to be saying that persons of craven mettle often eschew the challenge of being standard-bearers of truth, especially when controversial matters are involved. Articulating such views forthrightly tends to offend — somebody.

The particular mentalities of censorious Facebook flunkies and algorithms are new to Mr. Paine, of course. But he is ready to fight.

“Tyranny, like hell, is not easily conquered,” he declares when asked to assess his prospects, “yet we have this consolation with us, that the harder the conflict, the more glorious the triumph. What we obtain too cheap, we esteem too lightly. . . . [I]t would be strange indeed if so celestial an article as FREEDOM should not be highly rated.”

If that be hate speech, Mr. Paine seems to suggest, make the most of it.

This is Common Sense. Happy New Year! I’m Paul Jacob.

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general freedom international affairs moral hazard

WHO’s Daddy

WHO, Trump, corona virus, Covid, pandemic,

China and its lapdog, the World Health Organization (WHO), face increasing global anger over having initially hid the person-to-person spread of coronavirus, which has killed a staggering 126,000 people worldwide. So far.

Still unrepentant, Beijing and the WHO have continued to butcher the truth — even in petty ways. 

Late last month, a Hong Kong reporter asked a WHO official to comment on how successfully Taiwan had responded to the pandemic. The official pretended he couldn’t hear the question. Then, when the reporter offered to repeat it, he insisted they move on. 

WHO could provide such a cocktail of cowardice and disingenuousness?

Yes! 

Of course, the last refuge of such scoundrels is to hurl utterly bogus allegations — to play the victim and change the subject. Enter WHO Director-General Tedros Adhanom Ghebreyesus, who last week made the ridiculous and completely unsubstantiated charge that the Taiwanese government was instigating racist attacks against him on social media. 

Discriminated against by the United Nations and WHO for years, upon China’s insistence, the Taiwanese reacted on social media with their usual grace, sense of humor and a smart promotion of their island’s great food and beautiful scenery, using the hashtag: #ThisAttackComesFromTaiwan. 

As explained yesterday, Taiwan is a friend. China and the WHO? Not on your life.

That’s why Americans of all political persuasions (and so many others across the globe) cheered President Trump’s announcement yesterday that the U.S., the largest donor to the World Health Organization, would suspend its financial support.

“So much death has been caused by their mistakes,” Mr. Trump said.

Sadly, I fear Trump is wrong about one small part: “mistakes” seems far too generous a word for what WHO and its dastardly daddy, China, have done.

This is Common Sense. I’m Paul Jacob.

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crime and punishment general freedom moral hazard The Draft

Draft Mom or Not?

draft, registration, selective service, woman, women, female, barbed wire,

“The biggest piece of opposition” to extending draft registration to women, former Nevada Congressman Joe Heck told The New York Times, “was, we are not going to draft our mother and daughters, our sisters and aunts to fight in hand-to-hand combat.”

Yet, that seems precisely what the National Commission on Military, National and Public Service, chaired by Heck, called for in its just released report, urging Congress to make our daughters sign up for the military draft and to be equally conscripted in any call-up.

Or in a new compulsory military will draftees be able to say, “No thanks, I don’t feel like engaging in hand-to-hand combat”?

Today, women comprise nearly 19 percent of 1.2 million active-duty soldiers. They rightly have all combat jobs open to them — the very positions a draft has traditionally been used to fill.

So, in the name of equal rights are we forcing mom into a foxhole or not?

It seems . . . complicated.

“Women bring a whole host of different perspectives, different experiences,” offered Debra Wada, a commission member and former assistant secretary for the Army. 

Since when does the military conscript people for their “perspective”?

“[B]eing drafted does not necessarily mean serving in combat,” The Times paraphrased Wada. “In a time of national crisis, the government could draft people to a variety of positions, from clerical work to cybersecurity.”

This doesn’t seem to be about actual equality of service —or equality of risk — at all, but instead about a bigger pool of possible forced labor.

“If the threat is to our very existence,” Wada rhetorically inquired, “wouldn’t you want women as part of that group?”

Yes! Certainly.

Of course. 

But as volunteers, not as conscripts — and the same for men. 

This is Common Sense. I’m Paul Jacob.

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draft, registration, selective service, woman, women, female, barbed wire,

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folly international affairs moral hazard Popular

For Freedom in Venezuela

Venezuela, quagmire, mud, Maduro, socialism,

Last week’s coup in Venezuela flopped, it’s reported. But “coup” isn’t quite right: a popular rebellion failed to spark defections from key military commanders, who have become the end-all and be-all of Nicolás Maduro’s reign-at-rifle-point and rule by decree. 

Anyone with open eyes can see the illegitimacy of the Maduro regime. When governments shoot their own people and run over them with tanks or armored personnel carriers, there ceases to be any use in debating the fine points of political philosophies.

Facing the current impasse, opposition leader Juan Guaidó told a CBS News reporter he is “open” to U.S. military intervention, adding: “I want a free election now, no dictatorship, for kids in Venezuela not to starve to death.”

That doesn’t mean the U.S. should intervene, which I think would be a mistake for both us and, ultimately, the people of Venezuela — possibly turning a widely supported uprising into a protracted civil war.

“Before the bombers take off, let’s just answer a few quick questions,” Fox News host Tucker Carlson suggests. “When was the last time we successfully meddled in the political life of another country? Has it ever worked? How are those democracies we set up in Iraq and Libya and Syria and Afghanistan?”

I don’t doubt a sweeping military victory should the U.S. invade Venezuela, but it is getting out that always proves so difficult.

This is Common Sense. I’m Paul Jacob.

Note: Last week, a number of Venezuelan soldiers did indeed switch their allegiance from the despot to demonstrators — reminding me of the inspiring pacification of the initial Chinese troops sent to restore “order” in Tiananmen Square some 30 years ago. The head of Maduro’s Bolivarian Intelligence Service (SEBIN) also defected.

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Venezuela, quagmire, mud, Maduro, socialism,

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folly ideological culture media and media people moral hazard Popular

Systemic Refocusing

white privilege, Jussie Smollett, Elizabeth Warren, Rachel Dolezal

Everyone comes into this world with advantages and disadvantages. 

In the last century, public morality focused on the disadvantaged. Government policy changed dramatically, aiming to help those lacking many obvious advantages. But that focus got fuzzier and fuzzier as the ranks of disadvantaged people remained, even grew larger. Progress was made on several fronts, sure, but not on all — especially not on the ones most targeted.

We even “lost ground.”

Maybe because of this, the political focus shifted to “privilege” — which often merely means “advantaged” and sometimes means a special license granted by custom or law, which is said to be “systemic.” 

White males, we are told, have the most of it. 

So they must be attacked.

But does “white [heterosexual male] privilege” really exist?

Sure, in some contexts. But so do other “privileges.” Here is a better question: Are there privileges so built in that people try to horn in on them?

When there really was white privilege, “passing for white” was a thing. Now, we see other directions of racial “passing.” Sen. Elizabeth Warren, 99 and 44/100ths pure white, for example. If white privilege were really systemic, would she have pretended to be a native American? 

If white privilege were significantly at play in the academic world, the issue of Asian students qualifying for (and being accepted into) the country’s most prestigious universities wouldn’t even come up.

And if white people actually enforced their privilege, would the charges against Jussie Smollett for perpetrating a fake racial/ideological hate crime have been dropped? 

Seems unlikely.

If the results of focusing on advantage and privilege have been so dismal and dismaying, maybe it’s time for a refocus: on simple justice.

This is Common Sense. I’m Paul Jacob.

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white priviledge, Jussie Smollett, Elizabeth Warren, Rachel Dolezal

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education and schooling ideological culture moral hazard nannyism national politics & policies Popular

Make Others Pay?

Betsy Devos, education, special olympics, funding, budget, debt, spending,

Special Olympics has found a way to get kids and young adults with disabilities to feel something important: Able.

Three decades ago, as part of a community service requirement, I spent one day each week working with physically and intellectually-challenged adults at Easter Seals in Little Rock, Arkansas. I loved it. 

Most unforgettable were their beaming smiles of pride when they got a chance to show what they could do. I’ve always loved sports, but never as much as there and then. In the decades since, my family has given to the Special Olympics what financial support we could afford. 

So, can you imagine how I must feel hearing Education Secretary Betsy DeVos testify in favor of cutting all $17.6 million in federal funding for the Special Olympics? 

“It’s appalling,” declared Rep. Barbara Lee (D-Calif.).

John Kasich, the former Republican governor of Ohio, called the cut “outrageous” and “ridiculous.”

“Cruel and reckless” were the words Rep. Rosa DeLauro (D-Conn.) used.

“The Special Olympics is . . . a private organization. I love its work, and I have personally supported its mission,” countered Sec. DeVos.* “But given our current budget realities, the federal government cannot fund every worthy program, particularly ones that enjoy robust support from private donations.”

Federal funding provides only 10 percent of Special Olympics revenue, with over $100 million raised annually in private donations.

So, how must I feel about DeVos’s suggested cuts? 

Gratitude . . . for her generous contributions to Special Olympics — and for her fiscal responsibility. Let’s fund this wonderful program without the government forcing (taxing) support from others.

Check, cash or credit card is always preferable to virtue-signaling gum-flapping.

This is Common Sense. I’m Paul Jacob.

* Special Olympics is one of four charities to which DeVos donated her entire 2017 federal salary.

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Betsy Devos, education, special olympics, funding, budget, debt, spending,

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crime and punishment general freedom media and media people moral hazard

Porn, Video Games and British Crime

Great Britain, British, England, knives, violence, freedom, surveillance,

British freedom is eroding. The attack comes from two directions.

First, there is the over-bearing police-state style, surveillance-everywhere government.

Second, there is the increasing violence.

Thing is, the justification for Britain’s mass surveillance, as well as for strict gun controls, was to prevent crime.

Oops.

So of course the Labour Party “shadow home secretary” Diane Abbott points an accusatory finger at porn and video games. These two influences may be “desensitising young people to vicious behaviour.”

Well, porn and video games are changing our cultures, on both sides of the pond. But in America, at least, the crime rate for the past two decades plumetted while video games and Internet porn have become ubiquitous, explicit and . . . admittedly, appalling.

Look elsewhere for the crime uptick.

The Brexit fiasco, with the Tory government messing up implementation of the 2016 referendum results, has surely increased, not decreased, tensions all around, as has immigration policy, the collapsing National Health system, and much more. But worst of all? The nanny state, treating citizens as childish subjects. The police arrest people for nothing more than saying mean or just edgy things online. 

If people cannot be free legally, they will take license — illegally. 

Previously, we heard about a rash of acid attacks: acid thrown in the faces of pedestrians. More recently, the headlines are about stabbings — after years of knife control, of government crackdowns on even kitchen knives.

Ms. Abbott places the primary blame for rising crime not on the above, however, but on poverty and malfunctioning education. Not mentioned? The possibility that taking away British citizens’ rights of self-defense may have the perverse (unintended?) consequence of increasing offensive violence.

This is Common Sense. I’m Paul Jacob.

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Great Britain, British, England, knives, violence, freedom, surveillance,

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