Enlightened

August 08, 2009

George Washington in his farewell address (1796) advised: “In proportion as the structure of a government gives force to public opinion, it is essential that public opinion should be enlightened.”  The force of government on public opinion is being demonstrated to be more deceiving than ever. No wonder the Fairness Doctrine, which will silence opposition to the force of government on public opinion, is next on this administration’s and Congress’ agenda.  Too arrogantly to be done in opposition to the Constitution which states: “Congress shall make no law...abridging the freedom of speech or of the press…” (Amendment I).  There’s much to review in this regard.  But this letter will try to summarize key points on the government’s force on public opinion with regards to the treasury.

The feds started 2009 with approximately a $500 billion deficit.  The politicians used the force of government to establish the prevailing public opinion that this was so bad that only “change” could help. Something was done.  The belief we could borrow and spend our way out of debt. We are now exceeding $11 trillion in debt.  Then a proposed budget of $1.7 billion came along. In perspective, a spending spree of $53,906.64 per second. Thomas Jefferson gave a warning here: “The principle of spending money to be paid by prosperity under the name of funding, is but swindling futurity on a large scale.”  Why is the sense of being swindled not public opinion?

In 2008 and 2009 the federal government, responsible for the over-site of the various financial markets, discovered that their mismanagement resulted in a melt down of the markets.  So the Troubled Asset Relief Program (TARP) outlaid 7 percent of the nation’s gross domestic product or $1 trillion dollars.  To put that in perspective, our borrowing from foreign governments (like Communist China) has handed these bond holders $7 dollars for every $100 we generate…not counting interest.  This borrowed money was suppose to go to buying up nonperforming loans from financial institutions.  But instead the Federal Reserve injected this money into Bear Stearns, AIG, Fannie Mae and Freddie Mac, Citigroup and many more. Certainly there were jobs saved and or created in this process.  The Federal Reserve continues to infuse dollars into these financial institutions to a goal of $7 trillion. To compare: the American economy in 2007 was about $14 trillion. Additionally, $350 billion of the TARP funds cannot be accounted for, (ABC: January 9, 2009). Article 1; Section 8: United States Constitution: “…a regular Statement and Account of the Receipts and Expenditures of all public Money shall be published…”  

 The Wall Street Journal reported when adding the stimulus and bailout …”the federal spending share of GDP will climb to 27.5%.”  About $1 for every $4 generated by the economy will be controlled by the Federal Government.  Sixty percent (60%) of all mortgages and property are now owned by the Federal Government via Freddie Mae, Freddie Mac and the approximately 6,000 banks the Feds own.  

Based on government announcements, the public is of the opinion that unemployment is getting better.  Recently, a Wall Street Journal analysis shows that the unemployed are staying unemployed beyond their state benefits.  At which time they go on the federal unemployment benefits.  The politicians site the state enrollments for their assessment which, obviously shows unemployment going down.  The fact that people may still be unemployed without benefits, or on federal benefits is omitted. President Washington’s message was simple.  Always challenge the government.