Sunday, February 28, 2021
Why the Capitol Riot Terrified the Elite | James Ketler
Why the Capitol Riot Terrified the Elite | James Ketler: These days, it sure looks like they have them right where they want them. Using the storming of the Capitol Building as a pretext, the media-government alliance has targeted Trump, his supporters, and their fellow travelers harder than ever before.
Woke Classrooms Show Why US Parents Should Be Free to Choose on Schools | Kerry McDonald
Woke Classrooms Show Why US Parents Should Be Free to Choose on Schools | Kerry McDonald: The new “culturally responsive” teaching standards passed by Illinois legislators are just the latest example of the accelerating trend toward introducing and elevating critical theory ideology throughout US institutions.
The Narrative, the Coup, and the Bourgeoisie Marxism, innately, requires an oppressor to push back against. With Donald Trump out of office, expect the definition of “oppressor” in America to continue to expand. By Milton Abdiel
The purges began shortly after the revolution. For all its haste and ill-preparedness, the success of the Bolshevik Revolution in 1917, led by the perpetually temperamental Vladimir Lenin and fueled by a fierce devotion to Marxism, quickly gave rise to the vast and unimaginably harsh Soviet labor camp system that would come to be known as the “gulag.” As the leader of the newly established Russian Soviet Republic, Lenin wasted no time in ordering the establishment of decrees calling for the severe punishment of anyone deemed a “class enemy” to the new Soviet Republic.
From the perspective of Lenin and the Bolsheviks, class enemies were those who had opposed the Marxist Bolshevik Revolution and often consisted of individuals the Bolsheviks contemptuously regarded as privileged in their social class. These so-called class enemies, a term which eventually became synonymous with the “bourgeoisie,” ostensibly posed a threat to the proletariat-ruled, Marxist utopia Lenin was promising to the masses.
Thus, lists were made, and the unfortunate bourgeoisie who found themselves on these lists were stripped of their rights and their property, sent to the gulag, and executed by the millions during Lenin’s purges and Stalin’s Great Terror. To be clear, Lenin’s goal was not to eradicate the bourgeoisie entirely. Rather, he hoped to deconstruct the existing cadre of class enemies via extreme wealth redistribution and ultimately rebuild as the Bourgeoisie 2.0. The Marxists believed their moral superiority bestowed upon them the responsibility to identify and remove privilege from one class while simultaneously shifting privilege to those in the less fortunate classes.
As author Daniel Orlovsky writes in Russia: A History, “ . . . the ‘exploiters’ were deprived of civil rights and legally classified as the ‘disenfranchised’ (lishentsy). They had no right to work, but could be mobilized for menial labour or public works.” But how, under the bleak rule of Communism, could so many be considered privileged enough to deserve such a fate? The answer of course was that the bourgeoisie nomenclature was inherently vague, by design, and the gulag did not differentiate between its political prisoners of one social class or another. If you were there, you were an enemy of the state.
In her Pulitzer Prize-winning historical account of the Soviet gulag system, author Anne Applebaum writes:
From the very earliest days of the new Soviet state, in other words, people were to be sentenced not for what they had done, but for who they were.
Unfortunately, nobody ever provided a clear description of what, exactly, a “class enemy” was supposed to look like. As a result, arrests of all sorts increased dramatically in the wake of the Bolshevik coup. From November 1917, revolutionary tribunals, composed of random “supporters” of the Revolution, began convicting random “enemies” of the Revolution. Prison sentences, forced-labor terms, and even capital punishment were arbitrarily meted out to bankers, to merchants’ wives, to “speculators”—meaning anyone engaged in independent economic activity—to former Czarist-era prison warders and to anyone else who seemed suspicious.
The Bolsheviks did not launch their revolution and plant the initial seeds of communism without help. In fact, several years before the actual revolution, select members of the bourgeoisie and intelligentsia helped to facilitate a cultural revolution of sorts, in which they sought to atone for their sins of privilege by offering enlightenment to the peasantry. The intelligentsia hoped that with enough encouragement, they might convince the peasantry to rise up and revolt against the oppressive Tsarist autocracy. When that failed, the intelligentsia resorted to committing violent acts of terrorism while audaciously purporting to act on behalf of the oppressed peasantry in the late 19th century. In spite of the intelligentsia’s role in facilitating the eventual Bolshevik revolution, their lives were not spared under Lenin and Stalin, as they too could not escape the epithet of “class enemy.”
So goes the history of the Soviet Union, and perhaps, so too will be the future of the United States.
American Parallels
Even the most elementary understanding of the aforementioned brutal history of Marxism would require a profound level of willful ignorance to avoid taking note of the similarities between the early days of Communism in Russia and the agenda of the now-mainstream Left in Joe Biden’s America. One can say without hyperbole that cancel culture has been the inevitable precursor to whatever gulag and reeducation camps, both metaphorical and physical, the Biden Administration and CNN have reserved for the MAGA crowd. The self-described antifascists, who ironically remain decidedly fascistic, fancy themselves to be the modern incarnation of the Bolsheviks, with their college professors and establishment political class on the Left and Right acting as the apologetic intelligentsia with the grandiose moral imperative to protect the perceived peasantry of oppressed minorities, oblivious to the bigotry contained within their white saviorhood.
While the Spanish flu raged across the world in 1918, coinciding coincidentally with Lenin’s destruction of the Russian Empire, Marxism ultimately would prove to be the far more deadly pandemic around the world, resulting in an eventual death toll of an estimated 100 million people in the 20th century alone. These were deaths directly attributable to executions, starvation, and exhaustion from forced labor in Mao’s China, Castro’s Cuba, and Stalin’s USSR, among several other manifestations.
And yet Black Lives Matter, Antifa, much of academia, and their de facto sponsors within the corporate woke culture of Big Tech all openly endorse Marxism, not to mention the woke political elites on Capitol Hill pushing for Marxist reforms, seemingly as often as possible. If any individuals or groups openly espousing tenets of white supremacy or fascism emerge amongst a crowd of Trump supporters, the crowd is often quick to assume these individuals must be Antifa agitators or FBI plants instituting an entrapment scheme. Why? Because these individuals are outliers. They do not represent the values of mainstream conservative America and Trump supporters. This does not happen on the Left with Marxism. Thanks to an army of liberal arts professors, radical politicians, the Red Army factions of BLM and Antifa, and the messianic overlords of Big Tech, the Overton Window has shifted so dramatically that Marxism has gone mainstream.
As a minor aside, prominent libertarians have been conspicuously absent from the battle against censorship and cancel culture that has naturally accompanied the rise of Marxism in recent years. When the sanctity of our actual civil rights begins to falter, the folks who have long purported to be most in favor of defending them are nowhere to be found. One can only assume the libertarians are too busy imagining Satoshi Nakamoto origin stories and re-reading The Road to Serfdom to notice the ceiling falling on our crumbling democracy. To quote Alfred from Christopher Nolan’s “The Dark Knight,” “Some men just want to watch the world burn.” But perhaps when it comes to the libertarians, some men want to pretend that doing nothing stops the world from burning.
While Big Tech and woke corporate America continue the purge of conservatives from social media, airlines, hotels, book publishers, payment processors, etc., the Left dismisses conservative concerns over censorship while simultaneously gleefully engaging in political one-upmanship for accolades over the loudest calls for free speech eradication. Gaslighting aside, Parler ostensibly was shut down by tech monopolies Amazon, Apple, and Google because the free-speech platform provided an outlet for dangerous Trump-supporting extremists to organize and express violent rhetoric. Whether you agree or disagree with the intentions of that motley crew of selfie seeking orderly grandmothers, attention-seeking Viking cosplayers, undercover Marxist agitators, anarchists, trust-the-plan conspiracists, or the remaining incontrovertibly frustrated Trump supporters who rushed the Capitol, the argument that the alleged Trump-supporting “domestic terrorists” should be denied the opportunity to express opinions in order to keep the nation safe is nonsensical and dangerously naïve.
They Know Silencing Won’t Root Out Extremists
If data exist demonstrating a positive correlation between the silencing of Trump supporters online and the reduction in threats posed by domestic terrorism to national security, then American citizens deserve to see this information. They never will, however, because such information does not exist. The fact is, if the law enforcement and intelligence communities truly believed Trump supporters were legitimate domestic terrorists, they would not support silencing them. The open-source intelligence data they can accrue from social media chatter alone is invaluable.
Two of the most high-profile actual domestic terrorism cases in the United States, Timothy McVeigh of the 1995 Oklahoma City bombing and the Unabomber Ted Kaczynski, illustrate the absurdity behind the lie of the necessity for censorship. Timothy McVeigh murdered 168 people on April 19, 1995 using a truck bomb parked in front of the Alfred P. Murrah Federal Building in Oklahoma City. Liberals familiar with the Oklahoma City bombing are usually quick to point out that McVeigh was inspired by a racist, white nationalist novel he had read. McVeigh on the other hand, consistently maintained following his arrest and until his execution that the bombing was revenge for atrocities committed by the U.S. government at Ruby Ridge and Waco.
McVeigh watched these events unfold via live TV coverage and, in the case of the siege at Waco that left 75 dead, from a hilltop three miles away from the Branch Davidian Compound. Following his arrest, McVeigh explained, “What the U.S. government did at Waco and at Ruby Ridge was dirty. And I gave dirty back to them at Oklahoma City.”
If Twitter had existed in the 1990s, would they have removed any tweets documenting the events at Ruby Ridge and Waco in order to prevent the radicalization of all the Timothy McVeighs out there? Does expanding the definition of domestic terrorism to encompass all Trump supporters or anyone questioning the integrity of our electoral process mean the federal government is more likely to identify actual domestic terrorism threats like McVeigh?
Considering the FBI’s misconduct in abusing FISA for political motives, why should any American citizen expect the FBI to use these same tools effectively to prevent domestic terrorism? If we eliminate the effectiveness of the FBI’s electronic surveillance operations and we reduce their capability to gather open-source intelligence on these alleged domestic terrorists online, then we are left with an over-reliance on human intelligence sources. Confidential Human Sources in the FBI are only as effective as their handlers, and given the mistrust Americans have for the FBI at the moment and the general problems with reliability inherent to human intelligence operations, America is not safer with the Biden Administration’s irresponsibly wide definition of domestic terrorism and Big Tech’s censorship. This is particularly alarming given how useful the widely viewed death of Ashli Babbitt will be in potentially radicalizing actual lone wolf extremists.
Ted Kaczynski, the notorious lone wolf domestic terrorist who would come to be known as the Unabomber, was cursed with an intellect far above those of his peers in childhood. As an elementary school student, a school psychologist had administered the Stanford-Binet Intelligence test to Ted, where his incredibly high score was limited only by the uppermost ceiling of the test. Considering the average IQ score for test takers was 100 and Ted scored over four standard deviations above this mean, the results confirmed that Kaczynski was a genius. This superior intellect meant that Ted skipped grades in school, ultimately leading him to graduate from high school at 15 and attend Harvard on a scholarship at age 16.
Unfortunately for Kaczynski, these remarkable cognitive abilities came at a cost. They overshadowed a significant deficit he maintained in interpersonal abilities. He was an awkward loner as a boy, often bullied by classmates who could not understand his apparent indifference to the usual adolescent interests. His life was a sad tale of loneliness, of a brilliant child whose math skills led to an expedited entrance into adulthood without ever mastering a developmentally appropriate ability to socialize. By the time he was 30 years old, Kaczynski had withdrawn entirely from the world around him, living an isolated life in a remote cabin in Montana. By the age of 36, his bombing campaign began and would last until his arrest at the age of 52.
Notably, his arrest was only made possible because the Washington Post ceded to his demands they publish his manifesto in 1995, ultimately leading to Ted’s own brother recognizing the style of writing and alerting the authorities to the possibility that Ted Kaczynski was the notorious Unabomber.
Kaczynski’s manifesto offered an incredible glimpse into the motivations behind his multi-decades long domestic terrorism campaign. Titled, “Industrial Society and Its Future,” Kaczynski spends over 30 pages opining about the role of modern technology in the destruction of civil liberties, the environment, and our ability to engage in healthy human interaction unrestrained from corrosive ideology. In short, the man who spent his life as an isolated and misunderstood loner seemingly launched a decades-long bombing campaign across the United States because he believed modern technology was driving people apart, and his primary demand in exchange for halting his reign of domestic terrorism was to allow his voice to finally be heard via the printing of his manifesto.
Considering again the Biden Administration and the mainstream media’s attempts to regard Trump supporters as dangerous “domestic terrorists,” thus attempting to align half of the population with actual terrorists such as McVeigh and Kaczynski, would the Washington Post even agree to print a Unabomber-style manifesto in 2021? Discussing the impact of modern technology on personal freedoms in the future, Kaczynski writes in his manifesto:
Human freedom mostly will have vanished, because individuals and small groups will be impotent vis-a-vis large organizations armed with supertechnology and an arsenal of advanced psychological and biological tools for manipulating human beings, besides instruments of surveillance and physical coercion.
Ted Kaczynski wrote his manifesto decades before anyone had ever heard of Amazon, or Facebook, or Parler. Ironically the social media apps purportedly designed to bring others together and allow for a more connected world are rapidly denying conservatives the right to participate in that connectivity. Kaczynski no doubt would find the Big Tech monopoly on free speech a confirmation of the very bleak future he posited in predictions throughout his manifesto.
If the Unabomber’s campaign of domestic terrorism had occurred in 2021, would investigators finally crack the case after discovering a handful of selfies taken by him while he was participating in the storming of the Capitol, along with a trove of Pepe memes on his Parler account? Of course not. The Unabomber was the ultimate lone wolf, the type of terrorist who remains a far greater threat to our nation than roving bands of Trump supporters demanding election audits. The federal government knows this. Big Tech probably knows this as well.
Silencing Dehumanizes, Which Is the Point
The real reason conservatives and libertarians are being censored online, forgetting the drivel of Twitter’s bearded prophet Jack Dorsey, is that removing the voices of conservatives removes their humanity in the process of that censorship. Eliminating free speech for half of the population dehumanizes them to the other half of the population. Social psychologist Stanley Milgram’s famous Obedience to Authority experiments offer some illumination on this point.
In these classic experiments, Milgram’s study involved an authority figure in a laboratory setting instructing volunteer subjects to administer a series of electric shocks to fellow study participants on the supposed basis of the shock recipients’ response to a learning and memory task. Unbeknownst to the volunteer subject administering the electric shocks, the recipient/victim of these shocks was in fact an actor and the shocks were not real. The experiments examined the extent to which a research subject would inflict pain on another if following orders given by a supposed authority figure, particularly in the absence of any external coercive threats or repercussions in the event the subject chose not to obey. The results of the experiment found that all of the subjects obeyed to the point of believing they were delivering some level of shock to the victim, and two-thirds of the subjects delivered a level of shock that would have resulted in extreme pain and possibly death, had the electric shocks been real.
There were several variations to this experiment, including one version in which the recipient/victim of the shocks could not be seen or heard by the volunteer subject. In this instance, the volunteer’s obedience to the instructions given by the authority figure increased dramatically. In other words, increasing psychological distance between the person administering the pain and the person experiencing the pain resulted in a greater willingness from the volunteer subject to inflict pain on the other. The distance meant the volunteer could more readily dehumanize the victim, meaning the most salient traits that denote one’s humanity are removed from the purview of a potential aggressor in order to participate in some atrocity without experiencing a debilitating sense of guilt or remorse in the process.
Further, based on the results of this research, Milgram proposed that the ideology of the authority figure was a crucial factor in the volunteer subjects’ willingness to obey, meaning the authority figure’s insinuation that the pain inflicted upon the victim was necessary for scientific progress and for the good of the victim made the volunteer subject more likely to follow orders. “[I]deological justification,” Milgram writes, “is vital in obtaining willing obedience, for it permits the person to see his behavior as serving a desirable end.”
For a real-world example of where deference to authority and dehumanization of the other can lead, consider author Christopher Browning’s case study of Reserve Battalion 101 of the German Order Police in Poland during the Holocaust. The reserve police battalion profiled by Browning consisted of ordinary, middle-aged men who were not as heavily indoctrinated by Nazi fanaticism as the SS, but who nevertheless committed profound atrocities due to conformity, obedience to authority, and the dehumanization of their Jewish victims. The battalion was ultimately involved in the shooting deaths of at least 38,000 Jews and the deportation of another 45,000 Jews to the Treblinka extermination camp.
The men of Reserve Battalion 101 likely never imagined themselves capable of participating in such unspeakable horrors prior to the Holocaust, but ideology and obedience can corrupt even the most charitable and compassionate among us. The Russian novelist Aleksandr Solzhenitsyn understood better than most how easily the suppression of free speech and thought can quickly lead to the suppression of free movement and ultimately violence committed by those purporting to act on behalf of some common good. Solzhenitsyn was arrested in the Soviet Union in 1945 for criticizing Joseph Stalin in a personal letter he had written to a friend, resulting in a sentence of eight years in the gulag for his crime. Upon his release, in spite of all efforts in the Soviet Union to silence him, Solzhenitsyn wrote the largely untold truth about the gulag and the history of this oppressive system dating back to the Bolshevik Revolution in his famous book, The Gulag Archipelago. Discussing how readily average human beings can turn on one another when an oppressive system requires it, Solzhenitsyn writes:
The line separating good and evil passes not through states, nor between classes, nor between political parties either—but right through every human heart…even within hearts overwhelmed by evil, one small bridgehead of good is retained. And even in the best of all hearts, there remains . . . an uprooted small corner of evil.
To be clear, I am by no means suggesting the removal of Parler from the internet is comparable to the mass extermination of Jews in Nazi-occupied Poland during World War II or the horrors of the gulag in the Marxist Soviet Union. That would require a dangerous level of disgusting hyperbole monopolized for use by the present-day fanatical Left in America.
It is notable, however, that shortly after President Trump was banned from social media by Big Tech, Polish Prime Minister Mateusz Morawiecki condemned this censorship, stating, “Censorship of free speech, which is the domain of totalitarian and authoritarian regimes, is now returning in the form of a new, commercial mechanism to combat those who think differently.” German Chancellor Angela Merkel and poisoned Putin critic Alexi Navalny offered their own condemnations as well.
It would seem that those most familiar with the dangerous creep of communism, fascism, and authoritarianism are most apt to warn us when censorship is beginning to run amok in our own nation. Learning from history has never been a particularly strong suit within our polarized democracy, however.
Ushering In Another Kind of Extremism
In spite of the innumerable examples of Marxism, Communism, and socialism destroying nations and millions of innocent lives, the conglomerate of Big Tech, woke corporate elites, mainstream media, and Marxist foot soldiers have all happily joined together comfortably under the umbrella of the Biden Administration in order engage in what amounts to a replication of the tactics of the Bolshevik Revolution on American soil. For over four years, Trump supporters have faced the wrath of a cancel culture that holds zero regard for due process as long as the army of Bolshevik keyboard warriors can choreograph their mental gymnastics routines well enough to identify and denigrate the alleged privilege held by the suspect in question.
In Biden’s America, the loudest voices lobbing the loudest accusations will be rewarded like never before. The MAGA crowd, and by proxy conservatives and many libertarians, have been deemed racists, Nazis, and now domestic terrorists in order to justify the eradication of diversity in thought and speech.
As politically moderate Twitter users are gradually exposed to fewer and fewer conservative and libertarian voices online, Washington Post columnists, CNN commentators, and Biden Administration appointees will become the only voices shaping the narrative. Theoretical discussions about compiling lists of Trump supporters to ban from flights and employment will move from casual conversation to actual implementation, as will talk of re-education camps and deprogramming. Why would anyone want to grant domestic terrorists the right to live their lives unabated from public shaming and financial ruin? These domestic terrorists might be your neighbors, your friends, your coworkers, or even your own family. If Parler can be no safe haven for extremists, surely your neighborhood HOA will feel similarly?
Under the leadership of President Trump, the millions of MAGA supporters, adorned with their red hats and American flag t-shirts, were fairly easy for woke leftists to identify. But Donald Trump is gone now. And Marxism, innately, requires an oppressor to push back against. Just as Lenin and Stalin continued expanding the definition of “bourgeoisie” in order to justify the elimination of detractors, political foes, and anyone privileged enough to disagree with the official Communist Party narrative, so too will the definition of “oppressor” in America continue to expand. The gulag awaits, but there is no solace in the knowledge that a nation under Marxism will reduce us all to the same fate.
Boys Are Girls: America’s Great Struggle Session
Boys Are Girls: America’s Great Struggle Session: We have written earlier about the stolen election and the Great Struggle Session to which the American people are being subjected by the political left. The stolen election is, however, only the latest agenda item in the left’s project of reality subversion. Another whip with which the left has been painfully tormenting the American public for some years now is the so-called “trans” movement. Trans is an umbrella term for a body of assertions, notions and activities that strike most ordinary people as largely absurd. Perhaps the most shocking among them is the concept of transsexuality. This is the idea … Continue reading →
Market Weekly: Bitcoin Un-Tethered by Tom Luongo
Did you happen to notice the big news in Bitcoin the other day? It wasn’t the sound of the top forming at $59,000 or Janet Yellen’s comments about its ‘inefficiency.’
It was settling, once and for all, the argument that central planners and oligarchs aren’t omnipotent.
The State of New York’s pathetic slap on the wrist of Tether marked the moment Bitcoin joined the ranks of the ‘Too Big to Fail.’
Somewhere Peter Schiff is sad.
This lawsuit was supposed to be the nuclear bomb goldbugs thought would finally blow up bitcoin and return the world to their vision.
Too bad that multi-megaton nuke was more like an M-80 going off in my neighbor’s backyard.
“Tether’s claims that its virtual currency was fully backed by U.S. dollars at all times was a lie,” James said in a statement. “Bitfinex and Tether recklessly and unlawfully covered-up massive financial losses to keep their scheme going and protect their bottom lines,” she further said, adding: “These companies obscured the true risk investors faced and were operated by unlicensed and unregulated individuals and entities dealing in the darkest corners of the financial system.”
This is a face-saving statement for the press by NY Attorney General Laetitia James. Because if there really was a Ponzi scheme at the heart of Tether’s business in 2018-19 then she would have gotten them to cough up a helluva lot more than $18.5 million.
If the powers that be could destroy bitcoin at this point they would have pressed further charges against Tether, undermining the structure of the entire bitcoin market which is increasingly becoming a function of Tether liquidity.
But they didn’t.
In fact they gave Tether and Bitfinex the same treatment they gave J.P. Morgan for gold and silver market manipulation and the entire mortgage industry for fraudulently robosigning legal documents.
In other words, ‘We fined some folks.’
Most, if not all of the anti-bitcoin arguments come down to “the government hates it they will ban it.” But what happens when the government admits it can’t?
So while, Murray Rothbard was right, the establishment hates a free market more than anything else, Murray was also right that their is a limit to their power.
Um, someone tell Janet Yellen and Bill Gates running the anti-environment talking point that Bitcoin uses a lot of electricity isn’t working.
It’s the oligarchs’ latest talking point. And it’s pathetic.
Someone tell Laetitia James to get back in there and fight.
Meanwhile Bitfinex and Tether agree to quarterly monitoring of their books as a gesture of “transparency” and add $18.5 million to the failing tax coffers of New York State.
Whatever hinckey stuff they do they will now — like the major primary dealer banks — settle up at the end of the quarter to present the face to meet the regulators that they meet (with apologies to T.S. Eliot).
And, make no mistake, I think Bitfinex and Tether are sketchy as all get out. In fact, I think 95% of the entire crypto market is sketchy.
But, that doesn’t make it unreal or becoming something unstoppable. Because it doesn’t matter what purists want. The market, in the aggregate, is smarter than any one person.
And the market wants what bitcoin and Tether are selling… right now.
It may want something different in the future. The market is nothing if not fickle…. and gods bless it for this.
Which brings me to why this lawsuit is so important. There was a recent uptick in anti-tether noise out there, doomsdaying the latest bitcoin rally.
This article “The Bit Short: Inside Crypto’s Doomsday Machine“ (very long, and reasonably well researched) from January outlines a strong argument as to why Tether could be a scam.
And I want to point out how well-timed it was, published January 14th, coinciding with the first attempt to derail bitcoin’s rise.
He goes into a lot about Tether, staking his entire argument on their responding to this lawsuit as the proximate cause for their cashing out of their scam.
He does a forensic analysis of the Bahamanian banking system, lays out the mechanisms for startup company scam, the whole nine yards. Kudos to the writer, it’s a good tale you should read it.
He also didn’t sign his work, but, you know, details.
That doesn’t mean however:
- He’s right.
- Things can’t evolve or change.
- Tether isn’t performing a valuable service
- Demand for bitcoin liquidity outstrips available supply
In the end, this is just another great piece of writing that misses the bigger picture.
The market decides what it wants not you or me.
In short, it doesn’t mean Tether was intended to be a scam but could simply have been, like bitcoin itself, a service so needed by the market that demand for it far outstripped its ability to perform within its operating parameters, i.e. 100% dollar reserves 100% of the time.
That’s the main reason why Laetitia James settled out of court and Tether admitted no wrongdoing. The market was simply moving faster than the money pouring in and out of the crypto-space could clear and they shuffled some money around to, in the end, protect their clients and their business.
Here’s an aphorism which bears on this story, “It’s easier to beg for forgiveness than permission.”
$18.5 million and a negative headline is cheap to protect what is now a $35 billion business.
But, the premise of this article has been a standard refrain in the crypto-skeptic land for four years.
It boils down to, “You all know Tether’s a scam, right!?”
It’s a glaring bit of editorial bias. Because many of the arguments that people make about bitcoin and cryptocurrencies in general are built on the premise that everyone holding them wants to at some point “cash out and get back to dollars.”
But what does the market look like when a critical mass of people make a psychological shift valuing their portfolios not in dollars but bitcoin?
One could argue we’re in the process of finding out the answer to that right now.
I’ve talked about the potential for this shift previously here, here and here for anyone who still isn’t listening.
And that scares the living daylights out of everyone who makes their money outside of the dollar, bull or bear, but especially the bears.
Because for a generation now those bears were sold by people like Peter Schiff and the writer of this article which was disseminated far and wide in gold circles that gold was the only alternative to the dollar.
But it’s not and they are bitter about it.
They created what I now call “Gold-Only Bugs.”
For four years I’ve listened patiently to every argument against bitcoin and tether. They aren’t completely wrong. But they do, I think, overstate the risks.
I continue to hedge my bets against monetary insanity. I’m one of the few people in this space that advocates de-risking across all cash-equivalent asset classes.
With this lawsuit and the whole Tether Time Bomb removed from the market bitcoin is now part of the big time. It’s a multi-trillion industry. Those don’t just dry up and blow away without damaging the very people trying to defend against it.
When you owe the bank a thousand dollars it’s your problem. When you owe the bank a trillion dollars it’s their problem Bitcoin is a variation on that idea.
Blackrock’s buying bitcoin, folks.
Blackrock.
Coinbase is filing for an IPO. It’ll be at a valuation higher than Facebook’s.
In fact, it’ll be the biggest IPO in U.S. market history.
The bookrunning fees alone will make Goldman’s or Morgan’s next quarter a blowout.
They said the internet was a fad, too.
But yet you still think a troika of Participatory Medal Winners like Janet Yellen, Christine Lagarde and Jerome Powell are going to stop this train?
You think they can just wave their magic wands and make it all go poofta?
Why would Tether and Bitfinex run away with all the money now when they just won? Bigly.
They can pull massive yield in DeFi on their USDT and bitcoin. But they’re going to give up their first-mover advantage in the immensely important stablecoin space for a couple of billion which can be seized by any government?
The only central banker with a brain is Powell, as he properly identified the threat to their rule… and it’s not bitcoin.
It’s stablecoins like tether.
Because what is the dollar except a stablecoin backed by the confidence of the debtholders of Nancy Pelosi’s ability to extract wealth from Americans to pay the coupons?
If someone builds a better one than the dollar eventually it’s game over for the debt-based system.
Why would Tether run away with a few billion in depreciating dollars when they can literally bring down the entire monetary system and replace it with their product?
The reality is that the day the dollar becomes irrelevant is the day Tether folds up shop and completes their scam because no one will want dollars and a dollar-pegged stablecoin with dollar reserves will be redundant.
I’m not saying that day is here. No. We’re a long way off from that day.
But this lawsuit settling with such a whimper is a primal scream marking the next phase of the war between central banks and the people.
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Even the OECD Finds that Class-Warfare Taxes Lead to Lower Incomes by Dan Mitchell
I’m not a big fan of the Organization for Economic Cooperation and Development. Simply stated, the Paris-based international bureaucracy represents the interests of governments, and that means the OECD often pushes policies that serve the interests of politicians at the expense of taxpayers and consumers.
I’m particularly irked that OECD bureaucrats spend so much time and effort persecuting low-tax jurisdictions. And some of their work on issues such as poverty and inequality is grotesquely dishonest and sloppy.
But there are some good economists at the OECD. They’re apparently not allowed to have any role in policy, much to my dismay, but they occasionally produce very good research studies.
Such as the 2016 study that showed how many European welfare states would enjoy big increases in prosperity if they reduced the burden of government spending.
And the pair of studies that concluded spending caps were the most effective rule for sensible fiscal policy.
Or the study admitting that competition between governments leads to better tax policy.
Today, let’s look at another example of sensible analysis by OECD economists.
In a study published in late 2017, Oguzhan Akgun, Boris Cournède and Jean-Marc Fournier examined how different types of taxes impacted economic performance.
Lo and behold, they found that it’s good to have lower tax rates on businesses and it’s good to have lower tax rates on workers.
The present paper looks at the long-term effects of tax shifts on inequality and output for an unchanged size of government. …This study uses econometric analysis to provide estimates of distributional and output effects that can be expected based on the track record in OECD countries.
…The main findings emerging from the analysis are: …Higher marginal effective rates of corporate income taxation are linked with significantly lower long-term output levels. …Greater progressivity in the upper half of the income distribution, in the form of higher tax wedges on above average income earners, is linked with lower long-term output. …taxes on net wealth are found to be associated with lower output levels, in line with the literature on their distortive effects.
These finding are not a surprise, particularly for people who read the Tax Foundation’s research back in 2016.
Here’s the key visual from the OECD study. The top half shows how many nations could enjoy significant gains in disposable income if tax rates were lowered on workers with above-average incomes. The lower half shows how many nations also could enjoy gains in disposable income
The obvious takeaway is that the study shows that Biden’s class-warfare tax agenda will be bad for American competitiveness and American prosperity.
There are many other findings in the study, not all of which I like, and not all of which make sense.
For instance, the authors want us to believe that death taxes may actually have a positive impact on the economy.
Greater reliance on inheritance and gift taxes…appears to be output-enhancing by comparison with other revenue sources.
I realize the study is only claiming that such taxes are less damaging than other taxes, but it still doesn’t make sense since death taxes directly drain capital out of the economy’s productive sector.
The study also look at the impact of various tax changes on “inequality,” leading the authors to give a negative assessment to some tax cuts even if those reforms would increase the well-being of those with lower incomes (thus confirming Margaret Thatcher’s warning that some folks on the left are willing to hurt the poor if the rich are hurt by a greater amount).
I’ll close with two other findings from the study, both of which are more to my liking.
First, we find that consumption taxes (such as the value-added tax) hurt the economy, but not as much as income taxes.
Consumption taxes entail some disincentive effects, which are generally found to be weaker than those of income taxes.
Second, green taxes hurt the poor more than they hurt the rich.
…environmental taxes can increase inequality.
Given all the rich hypocrites on this issue, this doesn’t surprise me. They know they won’t be the main victims.
For what it’s worth, the OECD nonetheless wants a big energy tax on American families (thus confirming once again that there’s a disconnect between the left-leaning political types who are in charge and the professional economists who do real research).
P.S. Even if some OECD economists do good work, American taxpayers should not be subsidizing the group.
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