The Freedom Factory

Japan’s Home Ec classes are a tad more modern than ours. Instead of egg babies, they have robot babies.

These are especially popular now, as Japan is trying to encourage it’s females to have babies. You see, the once booming Japan is suffering dire economic consequences because their population is at an all time low, with a birthrate at 1.37%. Compare that to 2.12% in the US. Put simply, people are not having babies. This is causing severe economic problems for the country, which doesn’t allow immigrants. Continue Reading

Government detention camps cover up deaths-does America have a human rights problem? Congress passes unprecedented $3.6 trillion budget with $1.2 trillion deficit, official unemployment rates his 8.5%-some economists claiming they are really upwards of 20%, government mortgage giants Fannie and Freddie to pay $159 billion in new bonuses, Obama calls end to ‘Pax Americana’, world leaders pledge $1.1 trillion to IMF, Russia refuses to remove troops from Georgia, NY protesters call for government to ‘Bail out the People’, Hugo Chavez declares that ‘Capitalism must end,’ and Treasuries drop with announcement of next week’s $59 billion note issue and Goldman Sachs estimate that government will need to borrow another $3.25 trillion this year… Continue Reading

Obama more popular that Jesus, follows through on tax cuts, Sen. Schumer chastises Americans for caring about earmarks, White House says it will cut deficit in half, of chimps and racism, decomposing the stimulus bill, Clinton tells Chinese to go Green, Latvia’s government collapses, and Iran blocks opposition on Web…just the latest in your Freedom Under Fire Report! Continue Reading

Does anyone in government follow the laws that they pass? Or is it only the common man, who lacks access to power, that is expected to follow the rules?  Numerous scandals over the past several months have surfaced, in which our elected officials have been tripped up for not obeying the laws that they are supposed to uphold and enforce. The worst part is that these same officials influence policy or create new laws that further impose government’s power over the people. Continue Reading

In a recent article writer and journalist John Stossel states that “Barack Obama wants to use the recession to remake the U.S. economy.” Citing FDR’s mistakes in the 30′s, Stossel says that such “reform will impede recovery.”

Stossel is right in that Obama is certainly using the economic calamity to push  economic redesign legislation whose cost is estimated upwards of $1 trillion over the first two years. Obama wants to redo how our economy works. This includes massive infrastructure projects, various “green” schemes such as “weatherization,” alternative fuel subsidies, “buy American” programs and tariffs to protect domestic industry, and decoupling health care from employment-in other words, transferring health care costs and liabilities from the private sector to the public. What we know about government programs is that estimated costs almost always come in way under actual costs. In the case of this Soviet-style economic redesign, the $1 trillion price tag will likely fall woefully short.

Any money the government spends must be taxed, borrowed or conjured out of thin air by the Federal Reserve, and that will reduce sound private investment. Obama has no real wealth to inject into the economy. He can only move around existing money while inflation robs us of purchasing power. Meanwhile, private investors who might have produced a better engine, battery, computer, cancer treatment or other wealth-creating and life-enhancing innovations hold back for fear that big government will undermine productive efforts.

Americans have been on a path since the Second World War of delegating increasingly more of a our lives to government. We suffer from a disease that will likely prove fatal, in which we place undue confidence in third parties to manage our lives. As Stossel puts it, an “economy really is people engaging in exchanges to achieve their goals. Planning it means planning them.”

This is not American and will not lead to long term prosperity.

With a new plea to the Obama administration, the steel industry has become the latest lobbying group looking to get their hands on taxpayer funds. The CEO of Nucor Corporation (NUE)-one of the largest steel conglomerates-is lobbying the incoming Obama administration to advance a $1 trillion infrastruture package that has “in every provision a ‘buy America’ clause.”

This is nothing new. The steel industry has lobbied for and received special treatment for decades. With trillions in bailout and stimulus money floating to anyone who begs the most convincingly, the industry is stepping to the plate to take some of the spoils. Here’s a great explanation taken from the Cato Institute’s Center for Trade Policy Studies:

Over the past three decades, U.S. steel producers have been shielded from foreign competition by quotas, voluntary export restraints, minimum price undertakings, and hundreds of antidumping, countervailing duty, and safeguards measures. Yet the industry’s problems persist. Why? Because rather than strengthen the industry, protectionism fosters uneconomic capacity and discourages unsuccessful firms from the otherwise rational decision to exit the market. Continued operation of inefficient mills produces excess output, which suppresses prices, and jeopardizes prospects for healthier firms and their employees.

No matter what government does to give special treatment to steel, no matter how much money they give any of these companies, the industry will end up right where they are now, begging for more money in the future. No amount of money or artificial restriction to foreign competition will fix the industry’s problems.

With every new beneficiary stepping up to the federal trough we must remember we are weakening the long run health of our country. The federal government has assumed unprecedented liabilities and its balance sheet is becoming embarrassingly weak; this will have implications for our currency, which affects everyone. Corporate welfare has the same bad effects on business as social welfare does for individuals: we reduce incentives to alter inefficient behavior and keep doing the same bad things.

It started with financials-insurance companies, banks, investment banks-moved to retailers, automotives, commercial real estate developers, municipal governments, and has now moved to steel. Where is this corporate welfare theft going to end? With America’s bankruptcy.

Business people, by and large, are not stupid. In a free economic system, the stupid quickly go out of business and those that understand how to efficiently produce value survive. America is no longer a free society, and as business after business lines up to pillage taxpayers, some good companies are starting to leave for greener pastures.

MarketWatch estimates that 1% of the S&P 500 will leave America for Europe over the next administration to avoid increased tax burdens.

It is no secret that Barack Obama is not a friend of free enterprise or competitive businesses. Sure, he has his list of favorite industries and companies to which he’ll toss large amounts of our money, but fundamentally he stands for increasing taxes and regulatory burdens.

In my book, “Obamanomics: A Guide to Investing Over the Next Administration” I show that Obama’s tax plan to “close loopholes” and “eliminate special tax breaks” to raise an additional $100 billion in corporate taxes represents a 27% increase to the overall corporate tax burden. If simply added to the current 38% burden on capital that already exists in America, this easily makes America the worst place to do business anywhere in the world!

We live in a fiercely competitive world in which capital, people, and ideas can freely flow across borders. Obama, Biden, Paulsen, and an army of other lawyers, lobbyists, and other insane people claim they will make us more competitive with more laws, more regulations, more taxes, and giving our money to them to “invest.” This has never worked and will never work. It is pure insanity, and shocking that America has for so long bought into this nonsense!

The Federal Reserve system is the greatest single threat to personal freedom in America. It is a monolithic, all powerful institution that has supreme capability to play God with our lives. The Federal Reserve governors, and its Chairman, behave like Soviet price control committees, centrally determining the price of America’s most precious commodity, its currency.

Combined with unconstrained federal spending and political promises, America-once the most prosperous nation in the world-is broke. What a disaster!

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Who could have possibly seen the severe credit crunch and subsequent market crash this past year? And, if someone saw the impending crash, why did they not caution against it? Like it or not, there were several modern-day Cassandras that tried to warn us about the impending collapse; unfortunately, just like the citizens of ancient Troy, we failed to listen. Continue Reading

The federal government has spent or committed trillions this year to “fix” the economy. It’s not fixed. Government spending has never definitively demonstrated capability to reverse a recession, yet that doesn’t stop politicians from pledging our money to help us. Barack Obama intends to spend at least another $1 trillion in a renewed stimulus effort.

It’s really easy to spend someone else’s money. America has turned into a Banana Republic, unable and unwilling to balance its budget. This is a problem. President Bush grew the national debt by$5.7 trillion (72%) in 8 years. If Obama truly wants “change” he should refrain from these bad habits and balance a budget.

The total national debt now sits at $10.7 trillion and is rising fast.

Two reasons why we let our public leaders spend so much of our money:

• We don’t feel it’s our money…everyone thinks they will pass the responsibility of paying taxes to someone else.
• Most Americans don’t pay taxes

As such, government prints money with reckless abandon. America will collapse if this is not fixed fast.