rachelmills: Beginning to see the light...

RachelMills (

rachelmills) wrote,
@ 2006-04-02 19:41:00

Beginning to see the light...
I've always been on the fence about Iraq because I KNEW there was more to the story, and it usually has to do with money. This is from Feb '05 in my LJ

"I admit I don't know the whole story of Iraq and I don't know to what extent we were provoked by the treaty violations, WMD possibilities, oil prices yada yada yada. So I'm lukewarm on Iraq, lukewarm on our soldiers... "

I have received new information and theories that make oh so much sense and they have EVERYTHING to do with money, specifically the US dollar - VS. the Euro, AND oil. I knew Saddam was bad, but there are a lot of bad guys in the world. Why was he targetted? One reason, one action, one violation of terms that if left unanswered would have a devastating chain reaction ending with you standing in line to pay $100+ for a gallon of milk.

What action was this? Saddam took Euros instead of Dollars for oil.

Let's back up. Used to be our currency was backed by gold. Maybe some people don't know this, but that has not been the case since Nixon took us off the gold standard in the 70's. Our money is now worth what it is worth by decree, or by fiat. If you go to Fort Knox and ask for your dollar's worth in gold, you'll get laughed at. When Nixon did that, inflation began to ensue and to stave that off we had to somehow increase worldwide demand for the dollar. So Nixon brokered a deal with OPEC and the middle east, who have never been able to stabilize their political situations. Nixon says here's the deal - we'll use our military to keep things stable around there, police things if you will. In exchange, you will only sell your oil to people with dollars. Not yen. Not marks. Not francs. Dollars only. Got it? Now the rest of the world scurries to provide products to America, so they can get paid in dollars. They need those dollars to go to OPEC and get oil.

Thus when Saddam goes and invades Kuwait, the deal kicks in and we are obligated to go put him back in his place. That wasn't a favor. That was an obligation. The rest of OPEC sees that and is mollified.

Then in November of 2000, Saddam deliberately breaks the deal and accepts Euros for oil. The rest of the middle east looks on to see what happens to him for doing this. The next thing they know, he's dragged out of a rat hole and paraded in front of the world on TV looking completely mad and humiliated. This is our little warning to the rest of OPEC. OPEC sees this and is (hopefully) terrified.

And what if OPEC doesn't keep playing the dollar game? Economic meltdown. The demand for the dollar plummets and suddenly everything you have in your bank account is worthless.

I'm reading this
http://www.tacomapjh.org/petrodollartheories.htm for more information and the innerworkings.

But I KNEW there was more to the story. Its not so much that we need the middle east's oil. We get less than 20% of our oil from the middle east. It is that our dollar is backed by their oil, and secured by our military might.

So now how do I feel about the war? How do I feel picturing myself hungry and unable to buy things anymore? My benjamins not quite as valuable as toilet paper? It's a mess that's been brewing since the 70's and is coming to a head. It seems to matter little who gets elected to office next because this will haunt them.

No wonder Condie doesn't want to run.

(Post a new comment)

	darkknightradic 2006-04-02 06:56 pm UTC (link)
	Would you IM me? All the details are in my profile. (Reply to this)(Thread)

	rachelmills 2006-04-03 06:15 pm UTC (link)
	I would but i don't have access to IM right this minute... but I'm LadyJadeR on AIM and LadyJade_rem on yahoo messenger. (Reply to this)(Parent)(Thread)

	darkknightradic 2006-04-03 09:12 pm UTC (link)
	Alright, thanks. (Reply to this)(Parent)

	robert_johnson 2006-04-03 01:43 pm UTC (link)
	Ok. Didnt know about the Euro part. Pretty Deep. I'm going to check it out. I'm impressed. (Reply to this)

	bashow 2006-04-04 01:54 pm UTC (link)
	Iraq was never responsible for us getting off the gold standard. It's all people's right to not use the dollar if they don't want. The U.S. had no more right to attack Iraq for not using the dollar as they would to attack me for not using it. If and when the dollar falls, it will be the fed's fault, and they are the ones that should be delt with harshly. (Reply to this)(Thread)

	rachelmills 2006-04-04 03:40 pm UTC (link)
	Sure, they can and did stop using the dollar, but this isn't about "rights" this is about consequences and previous agreements made. It's like... the shop owner who stops paying his protection money to the mob. Does he have a "right" to? Does he care as his knees are being shattered? (Reply to this)(Parent)(Thread)

	bashow 2006-04-04 10:02 pm UTC (link)
	The shop owner should not have to pay protection money against his will just like people shouldn't be forced to use the dollar against their will. If they are forced to, we shouldn't support that. If they made an agreement to in the past, then the violent attack on them certainly is not a justified penalty. (Reply to this)(Parent)(Thread)

	rachelmills 2006-04-04 10:06 pm UTC (link)
	You're confusing the way things should be with the way things are. Good luck putting the smack down on the mob. Or the government. (Reply to this)(Parent)(Thread)

	bashow 2006-04-04 10:09 pm UTC (link)
	I know how things are, and I don't support how things are. I thought that's what we were talking about. (Reply to this)(Parent)

	bashow 2006-04-04 10:09 pm UTC (link)
	Also, I think "we" should get out of Iraq now. This country is wasting billions a month on this stupid war. Talk about economic suicide. (Reply to this)

bashow
2006-04-04 10:25 pm UTC (link)

What about if the Asian countries start dumping their huge holdings of dollars and stop buying our debt? Should we start bombing China and Japan? Hey I've got it. Instead of invading Iraq, lets invade the European countries that make Euros. Might as well go to the source right. Trying to force people to use dollars will work about as well as forcing people to not do illegal drugs. AS a libertarian, you should know that force only works when defending against force.

(Reply to this)(Thread)

darkknightradic
2006-04-05 08:13 am UTC (link)

If I may interject,

bashow, neither her nor I are advocating force. We are advocating not having to pay $100/gallon for milk. We are advocating not having our bank accounts drained dry or made worthless because of depreciation.

We both know what has to change. It's not about what we're doing now. It's not about making Iraq a free country (something they apparently don't want, or at least some violent extremists don't want). It's about getting rid of a worthless currency for one that isn't and doing so in such a manner that we don't bring this country to its knees because when our economy fails, and as it is going right now it will, we will become a third-world nation. We will be open to foreign influence including that from the socialist U.N. We will be a free nation no more. We will be an armed nation no more. That is what is at stake.

(Reply to this)(Parent)(Thread)

bashow
2006-04-05 02:27 pm UTC (link)

I understand your point. I don't want an economic collapse either. But going to war cannot prevent the collapse of our economy or of the dollar. War leads to economic destruction. It cannot help our economy, only hurt it. You talk about us losing our freedom. The biggest threat to freedom has always and always will be war. As the saying goes, "war is the health of the state". Our economy will most certainly be hurt by the end of dollar hegemony. But spending trillions in a non-defensive war will cause dollar depreciation as well. Has the war caused the price of oil to go up or down? Can we safely assume the new Iraq government if it is ever formed will use the dollar? All we know is this war is leading to further economic perile and an erosion of our liberties here at home. The war is the problem, not the solution.

(Reply to this)(Parent)(Thread)

	darkknightradic 2006-04-06 04:21 am UTC (link)
	I'm not saying its the solution, its just why we did. (Reply to this)(Parent)(Thread)

bashow
2006-04-06 11:10 am UTC (link)

It may very well be why we did. If all we are interested in is why we did it, than fine. But if we want to go further and see if what we are doing will actually accomplish why we've done it, then, from a praxeological perspective, the answer would have to be that it can only be counterproductive and ultimately fail. Government force to solve poverty, drug abuse, gun crimes, and the depreciation of currency can and will only result in more poverty, more drug abuse, more gun crimes, and an accelerated and further depreciation of currency. A sure way to UN control of the US, socialism, and the de-arming of America is through war. To prevent all of that from happening any further, we must oppose all non-defensive wars relentlessly. That is what is at stake.

(Reply to this)(Parent)(Thread)

	darkknightradic 2006-04-06 11:22 am UTC (link)
	Yes we need to oppose them, but the more important issue is to move us slowly away from fiat currency. (Reply to this)(Parent)(Thread)

bashow
2006-04-06 05:54 pm UTC (link)

I agree completely that we need to get off fiat currency. It's fiat currency that makes such aggressive war possible in the first place. I am of the view that such a thing can only happen though through the de-legitimization of democracy and majoritarian rule. This is why I'm a radical secessionist. The smaller each individual state is, the more difficult it would be to maintain fiat currencies and the better the chance of real money being used, like gold or silver. A highly centralized democratic state will always tend away from hard money. What are your ideas for us getting off fiat money?

(Reply to this)(Parent)(Thread)

	rachelmills 2006-04-06 06:00 pm UTC (link)
	No one in the first world uses non-fiat money anymore. (Reply to this)(Parent)(Thread)

	bashow 2006-04-06 06:35 pm UTC (link)
	Yeah. Do you have a point, or was that just a statement you felt like making? (Reply to this)(Parent)

	darkknightradic 2006-04-07 06:57 am UTC (link)
	advocating use of the liberty dollar, participation and advocation of the Free State Project, writing congress continiously on the issue. (Reply to this)(Parent)

	rachelmills 2006-04-05 08:21 am UTC (link)
	I'm not advocating the way things are, I'm just trying to understand the way things are. Stating that the way things are is bad is not especially useful. Yes, they are bad. Coming up with simplistic pie-in-the-sky solutions is not helpful either. We're not dealing with simple problems here. (Reply to this)(Parent)(Thread)

bashow
2006-04-05 02:35 pm UTC (link)

You think going to war in Iraq will save the U.S. economy, and you call my ideas pie in the sky? By you thinking war will keep away an economic collapse, you are rejecting all sense of reason and history. War means economic destruction, even for the winner. Thinking war will save the economy is like thinking drinking poison will cure a sickness. Getting off gold was a mistake, but so is war in Iraq. Two wrongs don't make a right. The way to end a mistake is to stop doing it. That's not pie in the sky thinking. That's common sense.

(Reply to this)(Parent)

	bashow 2006-04-05 02:45 pm UTC (link)
	If the goverenment puts a price contol on the price of milk, that will cause a shortage of milk. I guess ending the price contol, to you, would be pie in the sky thinking and too simplistic. To you, we have to "understand" the situation and maybe go to war with the suppliers of milk. (Reply to this)(Parent)(Thread)

	rachelmills 2006-04-05 02:47 pm UTC (link)
	Why did Nixon take us off the gold standard? (Reply to this)(Parent)(Thread)

bashow
2006-04-05 05:36 pm UTC (link)

From what I understand about it, foreign central banks were trying to redeem their dollars for gold. Since the fed had printed so many dollars, it would have been a considerable amount of gold to pay out. I'm not sure if it was more than we had, but it was more than the U.S. was willing to pay out, so they closed the gold window. Since then, with no restraint at all on how many dollars they print, inflation and debt have gone through the roof. You probably know more about it than me. We may have made a deal at the time for them to continue using the dollar, and if they break that deal, then we are free to go away from our end of the deal as well. But you cannot force someone to value a currency or anything else. The value for anything can only come from the subjective valuations of each acting individual. This is elementary economics, and no war or use of force can change that.

(Reply to this)(Parent)(Thread)

dominar
2006-06-30 08:34 pm UTC (link)

With all due honesty, the majority of the inflation that has occurred since the initial removal of the gold standard back around the turn of the previous century (The absolute fiat occured under Nixon), can be placed squarely in the hands of the recomendations of the Carter administration. This was done specifically to appease the farmer's unions that were his largest/most vocal constituency. Since then, the inflation rate has remained relatively steady and at a lower rate than the overall expansion of the spending power of the nation, which is a greater sign of the strength of the economy than the absolute purchasing power than an individual fiat unit.

Now, that being said, switching to any one individual commodity -- almost all of which are kept with rather massive reserves (think deBoers and diamonds) -- would really rather not solve any of the problems of fiscal fluctuation. I recall the massive fluctuations over the last three decades of the valuations of gold. You would be hard pressed to name a well-standing experienced economist whom speaks of gold as an asset still.

The majority of the problem for the united states that is occuring through the use of fiat currency but not explicitly connected *TO* fiat currency is the simple fact that *OUR* fiat currency is in fact not owned by the federal government, but instead rather by a specific agency; the FDIC.

Every cent of federal spending is done under the auspices of loaned monies which are granted by the FDIC -- for return of interest.

If this were ended, the rate of inflation -- and taxation -- would reduce dramatically.

I'm through. :)

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bashow
2006-07-01 07:41 am UTC (link)

Well, if the spending power of the nation has expanded, just imagine how strong the economy would be with no inflation at all. I'm not sure what you mean by fiscal fluctuations. What I can say about the fluctuating price of gold is that it's due to the value of the fiat dollar. When people lose confidence in the fiat dollar, they start buying a secure asset like gold. If gold were the actual money used, its value would be represented in the prices of goods and services. Since the supply of gold remains relatively steady and production continues to expand at a faster rate, that would mean lower and lower prices, but the real value of gold would go up. Everyone would become wealthier, and it would be real wealth and not illusory wealth as in the case of credit indused bubbles created by the fiat dollar.
That may be true that no "well-standing" economist speaks of gold as an asset still. However, just because someone is "well-standing" doesn't mean they know what they're talking about. I can name maney economists that think gold is still an asset: Ludwig von Mises, Murray Rothbard, Hans Hoppe, the whole of the Austrian school of economics, as well as commentators like Lew Rockwell, Gary North, Bill Bonner, and many others.
I don't know much about FDIC. However, if fiat money were owned by the federal government, that surly would not lower inflation. Politicians love inflation because it enables them to spend more without having to directly tax. It's the same as when a criminal gang counterfiets. The only way to do away with inflation is by doing away with all fiat currency and going back to hard money like gold, as well as 100% reserve banking. That is the only moral and economically sound monetary system.

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dominar
2006-07-01 09:31 pm UTC (link)

The valuation of gold was fluctuating -- badly -- on a daily basis. That has absolutely *NOTHING* to do with the fiat dollar, and everything to do with the market-valuation of gold.

It is precisely because of the low value of gold and the fluctuation of its values in relation *TO* the dollar, that it is no longer seen as an asset.

Assets must be consistent in value and perhaps even increase in value over time. Gold, silver, diamonds, and the like no longer do this.

And quoting Mises, Rothbard, and their ilk hardly qualifies as able economists. Sorry. They advocate anarchy, without regard to the actual impact of their ideologies or recognition of the limitations upon freedoms that exist in a viable anarchy, simply because "it's not the state."

As to the matter of the federal government owning the federal reserve notes... and "politicians loving inflation." -- those are inordinately false tautological statements. Jimmy Carter loved inflation. Reagan certainly didn't. Your words here sound like the words of a man so enraptured with the ideology of "freedom" that he can no longer think freely.

I've been having debates like this for a short while now in my local community. I bring this up to let you know that any rebuttals you may make to this, I have probably encountered more than once. They aren't very effective -- but I do have to give you this; at least you directly answer the points made. :)

One final aside; the concept that as gold becomes more abundant, the prices of things would go *down* is just plain silly. What you described was inflation of the monetary unit -- and somehow according to your logic, simply because it's inflation of a physical material/good rather than a conceptual material/good, this would *reduce* prices.

That's so obviously false I don't even feel the need to explain why it is so.

Take care of yourself, man -- I'm out.

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bashow
2006-07-02 10:54 am UTC (link)

You say the fluctuation in the price of gold has nothing to do with the fiat dollar. What about all those investors and speculators buying gold to hedge against inflation of the dollar? Also, if gold were the actual money used for currency, it's value would be based on its value relative to goods and services to be exchanged for it. It's not used as money now, and is more like an assest like land. I'm saying it should be used as money and the paper money done away with. I also wouldn't consider the 25 year high of the price of an ounce of gold low in value. People have made a lot of money off of it the past few years.
I never said that prices would go down as gold becomes more abundant. I said prices would go down as production of goods and services expand and the supply of gold remains steady. There would be the same amount of gold chasing more goods and services. Prices would go down.
Mises and Rothbard, I would say, were the most able economists of the last century. They showed that the basis of economics is the self evident fact that humans purposefully act by using scarce means to achieve desired ends. Any use of force against a person's right to act as they see fit can only lower the standard of living of all person's involved. The state, being the biggest violater by far of people's right to freely act, is and should be seen as the culprit of many social and economic ills. It is a criminal gang that has managed to gain legitimacy from enough people to exist on such a large scale. Try if you like, but there is no way you can refute that.
Yes, it is true that politicians love inflation. They love taxes, regulations, inflation, and anything else that enriches and enpowers them at the expense of the rest of society. You say Reagan didn't love inflation, yet it was Reagan that appointed Greenspan to head the federal reserve. The very Greenspan that presided over the inflationary boom of the stock market of the 90s, as well as getting the inflation induced real estate boom going. I guess you're going to tell me Reagan was against big government spending too even though the deficit tripled during his reign. Your words here sound like a man so enraptured by the ideology of the state that he can no longer think clearly. You know that my ideas can be summed up in two words: private property. From that, you will know my position on every issue.

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dominar
2006-07-02 08:34 pm UTC (link)

You, sir, are a self-admitted "praxeologist" whom cannot be dissuaded from his previous biases by any amount of evidence.

Your ideas are foolish, unsupportable by evidence, and based on preconceived cultish ideals which have absolutely nothing to do with the supporting of or inducement of actual freedom, and rather have everything to do with the "cult of freedom."

The "militant Islamists" amongst other things cry out for freedom. Bush, today, still calls out for freedom, and believes -- truly believes -- that he is fighting for the freedoms of America.

The soviets believed they had freed the People, and the common populace believed that the state had provided it to them.

Your ideology is blind, and that is fundamentalism -- the enemy of freedom.

Once you move beyond it and can come to realities, then we can discuss things that might actually make people free to do as they see fit in society. I will sum up things you need to consider in a few short statements:

1) Fiscal economics is not sound social theory.
2) Private property is important, but not the solution to everything.
3) The valuation of gold fluctuates on a *DAILY* basis. The dollar does not.
4) Mises and Rothbard are heeded by only a segment of the "libertarian movement." Not even the entirety of libertarians heed them. There is a reason for this.
5) Calling something free doesn't *make* it free.
6) The existance of authority does NOT imply the cult of authoritarianism.
7) The only way a supply of a material could remain steady would be if no more of said material were to become available. Gold continues to be mined.
8) Gold is no longer an asset in the minds of the common man. This is significant because this means its tradeability is no longer sufficient to back an economy.
9) Coin currency is no longer a viable method to engage in fiscal exchange. It has been obviated by the electronic age.
10) Anyone who advocates recidivism in any real fundamental format has two problems:
A) Their ideology will not and cannot succeed -- recidivism never does
B) Their ideology flies in the face of all evidence.

(Reply to this)(Parent)(Thread)

bashow
2006-07-02 10:21 pm UTC (link)

I am a praxeologist but only because I find it to be correct. It merely shows, through reason, the implications of individual action. What is freedom to you? From my perspective freedom means that no one may use force or fraud against another person's person or property. Exactly how is being opposed to murder, rape, theft, assualt, slavery, destruction of another's property, and fraud cultish? What do you mean by actual freedom?
From my perspective then, militant islamists, the soviets, and Bush are not promoting freedom at all, but the opposite of it. My ideas are not blind but based on the use of reason. I do not take it blindly at all. I take it based on it making sense and being consistent, as well as it conforming to my Christian beliefs. Do you call me a fundalmentalist because I have principles? It's interesting how many names you can call me without making a single coherent point. Where am I going wrong? How am I not in reality? The only thing I know about you is that you are against what I think. Where exactly do you stand philisophically or politically? People can be free to do as they want in a society if people leave them and their justly aquired property alone. That's what freedom is.
1. Economics is a crucial part of social theory. Society does not exist outside economic relations.
2. Where ever private property is not recognized, there will be conflict.
3. The dollar does fluctuate on a daily basis. Follow the daily exchange rates.
4. Not all libertarians are Austrians, but many are.
5. That's true.
6. That's true as well. But the authority must be just.
7. Gold does continue to be mined, but at a far lesser pace than dollars are printed. The mining of gold would not be enough to keep prices from falling in a highly productive economy.
8. If the dollar is backed by gold and it's illegal to counterfiet it, than it will be perfectly sufficient, unlike paper money.
9. one can make electronic transactions in gold as easily as one can in paper.

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dominar
2006-07-02 10:36 pm UTC (link)

My list of items was made for you to think upon, and find the necessary answers to realize what precisely the point I Was making, in fact, was, and how it applied to you.

I say this again; you are a victim of the ideology/cult of "freedom" and as such are no true proponent OF "real freedom." Every single argument that applied to the communists, Bush, and their ilk, applies directly *TO YOU* as well.

You need to spend some real time investigating this. I'm not going to bottle-feed it to you.

Don't bother responding to this -- the point is that you need to think these things through. Even if you *do* respond; you still need to find these truths, and do it for yourself.

(Reply to this)(Parent)(Thread)

	bashow 2006-07-02 11:34 pm UTC (link)
	I don't care. I don't want bull shit bottle fed to me anyways. (Reply to this)(Parent)

	rachelmills 2006-07-02 11:00 pm UTC (link)
	Bashow is always right. What we have here is a good little public school student. Let's waste more energy on him! Oh, I just remembered. I have something better to do. (Reply to this)(Parent)(Thread)

	bashow 2006-07-02 11:26 pm UTC (link)
	Since when do public schools teach anything near what I say? You're a libertarian, so what problem do you have with what I said? What do you have against me anyways? (Reply to this)(Parent)(Thread)

	rachelmills 2006-07-03 12:35 am UTC (link)
	I was talking about the other guy. You, my dear Bashow, really are always right. The other guy is a moron. (Reply to this)(Parent)(Thread)

	bashow 2006-07-03 12:46 am UTC (link)
	Sorry I misunderstood. I wish I were always right, but I'm certainly not. (Reply to this)(Parent)

	campaignstaffer 2006-04-20 03:54 pm UTC (link)
	Pardon my intrusion, but I'd like to invite you to join the new badnarik_in_dc group that I've created, the official Badnarik for Congress LJ community. It's my way to advertise campaign events here on the journal, and recruit new supporters no matter where they live. I won't bug you again, but I just wanted to let you know that we're here. Come hang out if you so desire. (Reply to this)

(Reply from suspended user)

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