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Show The Paper That Dares To Take A Stand Page 6 The Utah Independent April 10, 1975 The Wolf is PROJECTED (In billions of dollars) billions. With the Debt increase for Fiscal 1976 likely to run from three to five times that of 1974, the Treasurys task of selling government securities is going to get much tougher. With unemployment high and business profits falling, few private funds will be available for government securities or business expansion. This means that Debts will be monetized; that is, dollars will terrifying as these figures are, they tell only half, the story. For some years now, our Presidents have tried to hide a large part of the deficit from the American public. Certain expenditures have been placed outside the Budgets. The Social Security and other trust funds they spend are not included. If such funds are added, as they should be, the deficit for the two years would come to $120.4 billions. This is the actual contemplated increase in the Public Debt. Few papers carried that vital figure. Not even the august New York Times considered it fit to print. However, it is the bottom-lin- e figure in the fine print of the massive government documents which few people see and fewer read. The above table not only gives these figures, but it also shows the effects of the expected Congressional refusal to support the Presidents proposed petty spending cuts as well as a part of what Congress is likely to add to the tax cuts. Congress has already refused to allow a small cut in the Food Stamp Program. Even most of the Conservatives voted to g support this subsidy. These figures do not include any new spending programs. Not one cent is included for any of the new socialized medicine programs that so many in high places consider urgent. Apparently, not even the current nursing home scandals can dampen their ardor for more of the same. so-call- ed price-raisin- Some dangers of continuing inflation are apparent to all. Yet, few have any idea of the root cause. Our politicians, who are solely responsible for inflation, pose as inflation fighters, while asking business and organized labor to help stop our ever rising prices. Traditionally and by dictionary definition, inflation has always been an increase in the quantity of money. When inflation is so defined, it becomes obvious who is responsible for inflation. Neither corporations nor labor unions can create money. Only th politicians can and do. Business would like tp raise its prices every day. Workers would also like to raise their wages every pay day. But business cannot raise its prices or its workers wages unless its customers ,can and will pay the higher prices. In the final analysis, it is the customers who make the decisions to pay higher prices or not to pay them. When the government creates and allocates more dollars to its favorites, the recipients can and do bid prices up. Inflation is tnat simple. By defining inflation .as higher prices, our politicians have diverted public attention away from their responsibility in creating the more money that leads to higher prices. They have also turned attention away from the fact that these new dollars disarrange both consumption and investment and thus the guidelines and structure of business and industry. -- Increases in the quantity of money never increase available consumable wealth. They ' merely rearrange purchasing power and production in a manner which cannot be continued indefinitely. Wealth is confiscated from the wealth producers and distributed by pure chance or political pull. Such policies inspire envy, jealousy, group hatreds, and often violence. While our inflation to date has been painful, we must prepare for worse if this highly inflationary Budget, or anything like it, should become a reality. The more dollars that government spreads around will only buy fewer and fewer goods as the costs of doing business soar. In 1968, Mr. Nixon was elected as a Conservative. At first, he sought to dampen down his predecessors inflation by cutting back the rate at which he increased the quantity, of dollars. Those dependent on the continued pumping out of these dollars cried for help. So Mr. Nixon announced that he was now a' Keynesian and started to add larger doses of dollars to those already in the market place. In 1971, he injected 54.4 billion new dollars into the economy. It sent prices soaring. Foreign governments and their central banks became alarmed. It looked as though they might claim gold for their dollars at the then legal rate of one ounce of gold for every $35 presented to our Treasury. On August 15, 1971, a worried Mr. Nixon slapped on price controls to divert attention from the fact that he had to break the dollars last tie to the tie that had supported the gold - dollars purchasing power in international markets. Two legal devaluations followed in short order. Since that fateful day, there has been no limit on the number of dollars the Administration can create, except' for the Debt limit which Congress is constantly under pressure to raise, whenever the Treasury finds itself unable to pay the bills for what Congress ordered. In 1972, the Nixon Administration pumped 52.8 billion more new dollars into the economy, raising prices still higher. In an attempt to slow down the inflation, official action reduced the dollar increase to $46.6 billions in 1973 and $41.7 billions in 1974. These reductions in the quantity of new dollars poured into the economy hurt people and businesses whose prosperity depended on the flow of new dollars in ever increasing amounts. The result had to be lower production and increasing unemployment. In Calendar 1974, the federal governments Public Debt rose by $22.8 billions. Placing that Debt was difficult. Insurance companies and commercial and savings banks sold off their government securities as d businesses offered them higher interest rates. Private individuals took S7.3 billions, only about d of . hard-presse- one-thir- be artificially created to buy government securities as well as to be given or lent to individuals and businesses. How many,, we cannot know. But it could easily exceed 100 billion dollars. The effects this will have on prices ' stagger the imagination. With these prospects highly possible, how long will foreigners hold on to their d billions of Eurodollars? If these dollars come running home, they will send prices up still further. All of which might raise a hue and a cry for price controls. This could drive us into a Hitlerian form of national socialism and the end of the freedom that has been the source and strength of our high living standards. The Presidents program is pro- posed as a solution for three crucial problems; the energy crisis, inflation, and recession. In each case he asks for more government cong, trols, and the political distribution of more dollars. The proposed combination can only create more shortages and lead to a controlled society with all the miseries that socialism has always brought to the masses. Take the energy crisis. On January 16th, the President told Congress: During the 1960s, this country had a surplus capacity of crude oil By 1970 our capacity, our surplus capacity had vanished, and as a consequence the latent power of the oil cartel could emerge in full force. What turned the situation around? In the 1960s there was considerable agitation to close the depletion allowance loophole. It was aimed at those terrible Texas oil millionaires whose successful investments had helped keep oil prices low. At the same time, the environmentalists, with no understanding of economics, were agitating against the creation of power plants and later the oil pipeline to the Alaskan oil. As a result of these agitations, taxes on the oil industry were raised and the difficulties of increasing energy production were magnified. Those who still wanted to invest in oil explorations expanded their activities abroad. Given the whipped up feelings against oil companies and public utilities, few savers would invest their hard earned funds in such industries. Consequently, these industries could only expand as far as their retained earnings permitted. As a result, less oil was produced in this country in 1974 than so-call- ed post-192- so-call- ed anti-soci- deficits. al in 1973. Many who invested in oil exploration abroad have had their in- vestments nationalized without the slightest protest from our government which was founded to protect the lives and property of its citizens. Our energy shortage was created by our politicians. It can be ended in a reasonably short time if our politicians will reduce discriminatory taxes and permit free market forces to operate. If oil profits should temporarily soar, the competition of new investments will soon bring them in line. The President and his Democratic opponents propose new taxes and con trols on oil and other energy sources. Such proposals can only lower our living standards. They say they do not want foreign countries to strangle us. It would seem they want to reserve that right for themselves. Higher taxes and prices on the lifeblood of warm homes, transportation, and industry would certainly do that. It was a relatively free market that provided an abundance of cheap energy in the past and it is the only source that can provide it again. The problems of inflation and recession are intertwined. Here too, the answer is the free market. Recessions and depressions are the inevitable results of prior inflations. Our dominant economic problems are all related to political interferences with the free market processes. Americas first great economist, Pelatiah Webster (1726-1795stated in an essay in opposition to the Continental currency inflation: An error in finances, like a leak in a ship, may be obvious in the fact, alarming in its effects, but difficult to find. Few Americans can locate the leaks in our ships of modern finance. The seepages are hidden and difficult to spot. But as Webster also said: The first thing necessary to correcting an error is to discover it. The next is to confess it, and the last to avoid it. We cannot solve our inflation and recession problems until we discover the basic errors that have led us astray. Many of our current fallacies spring from the unfounded premise that free enterprise failed in 1929 and that its weaknesses were responsible for the depression that started in that year. Unbiased analysis has proven, beyond contradiction, that it was not free enterprise but political manipulation of the quantity of money that failed in 1929. Once this error is more generally recognized and confessed, we can then avoid any further increases in the politically created dollars our political system has been pouring into the economy; The seeds of our present problems were planted when Franklin D. Roosevelt confiscated our citizens monetary gold. This loosened the brakes on the political creation of dollars. It also 9 started the inflation parade with two, three, and four billion dollar ), 90-od- belt-tightenin- A Stand April 10, 1975 The Utah ow At The Door Continued from page 1 the new Debt. The governments own trust funds took $11.6 billions, more than half the total. The Federal Reserve Banks had to take another $2.0 FEDERAL DEBT INCREASES The Paper That Dares To Take . Unfortunately, Mr. Roosevelt and his advisors thought that the best depression remedy was a larger quantity of dollars. So his Administration started inflating both the currency and bank deposits. By 1938, he had the quantity of dollars back up to its 1928 figure. He had thought this would bring back the 1928' prosperity. It didnt. Unemployment in 1938 was as high as when Roosevelt first took office. His New Deal did not solve the depression. World War II diverted attention from our domestic economic problems. The war also provided an excuse for our politicians to more than double the number of dollars circulating in our economy. After World War II, our political leaders of both parties adopted Keynesian inflationary policies as a panacea for all the economic problems that political intervention had created. The late Professor Keynes was an apologist for policies Great Britain first adopted in 1931. For many years Great Britain had operated largely like a factory, importing raw materials and exporting finished goods and coal for world shipping. In 1925, when Great Britain went back on the gold standard, she unfortunately raised the value of the Independent Page 7 British pound so high that British goods were priced out of world' markets. With organized labor insisting on the same pay in the higher valued pounds, the result was mass unemployment. When workers ask for higher wages than customers will pay for their products, the result is always unemployment. The British politicians felt the best way to lower wage rates was to lower the value of the pound. So Britain went off gold in September 1931. The British workers kept their high pound wages, but their pounds bought less. Four years later, John Maynard Keynes wroie his General Theory Of Employment, Interest And Money. Its key sentence reads: A movement of employers to revise money wage bargains downward will be more strongly resisted than a gradual and automatic lowering of real wages as a result of rising prices. Professor Keynes understood the political difficulty of reducing the pound wage rates of British workers. So he wrote in confusing language an academic justification for the political reduction of wage rates by reducing the gold value of the monetary unit and quantity of increasing the such units competing for available goods and services. American Administrations have practiced these policies ever since World War II. They fooled our labor union members for many years. Our labor laws helped unions get higher dollar wages for their members. Then our politicians lowered the value of their wages by increasing the number of dollars competing for' available goods and services. After a while, union statisticians .noted the rising living costs produced y more dollars in the market. Unions then demanded and got compensating higher dollar wages. However, these increases always lagged. As years passed, some union men realized they were still losing. They had to share their cost of living raises with the tax collectors. Now, when the cost of living rises 10 percent, the unions ask for a 10 percent increase in their take-hom- e pay. This adds roughly 15 percent to labor costs. Employers who cannot raise their prices 15 percent are sooner or later forced to reduce production. As this process continues, consumers no longer have funds to keep everyone employed at the wage rates labor unions demand. So unemployment mounts. The Keynesian solution no longer works. Budget proposals based on it will only produce still higher prices and rising unemployment, along with demands for more subsidies for the unemployed. In the few years since Mr. Nixon gave up his efforts to hold the dollars international value at 35th of an ounce of gold, the dollar has lost more than 80 percent of its value in world gold markets. The glamour has gone. More dollars no longer create the illusion of prosperity. Budget programs based on deficit spending and dollar creation have readied the end of the line. The sooner the American public and their representatives understand this, the sooner we can stop our inflation and the readjustment recessions such inflation makes necessary. America must go into reverse but there is fast; It will beIf painful our people can be no other way. shown the value ot free market prices, free market wages, and free market interest rates, the pain need not be long. Such guidelines direct business quickly to the employment of all 1 mmm When treason prospers, traitors become heroes." Sovietizing of Children Planned by New Congress Comprehensive child development, the system of communal child rearing which almost became law in this country in 1971, is once again being pushed through Congress. The radicals who rammed it through both the House and Senate during the 92nd Congress only to have former President Nixon veto it shortly before Christmas, are hoping that the public uproar it raised then has died down. If American parents are properly informed, I doubt that they are ready to forsake their tradi- vides funding for a wide spectrum of day care programs, prenatal care, early medical screening and indoctrination of parents. The price tag for giving up our children to the care of HEW-traine- d change agents is high, $1.85 billion for the first three years. About 65 percent of the available funds would go to families, many of whom dont have the education or financial means to fight this by government. The Senate has already held two days of hearings before Mondales Subcommittee on Children and Youth, and the House Select Subcommittee on Education, chaired by Brademas held three days of hearings. More of the slanted hearings are planned for this month or perhaps Soviet-styl- e d tional approach to bringtheir children and ing up replace it with one similar to that of the Soviet Union. The current bills, H.R. 2966 and S. 626, are virtually identical to the original act passed in 1971. The name of the new program has been changed, but certainly not to protect the innocent. Now it is known as the Child and Family Services Act of 1975 and any changes are merely low-inco- child-takeov- er family-centere- cosmetic. In vetoing the original scheme which would have removed children from their parents instruction shortly after birth, Nixon said that it would weaken the American family by committing the vast moral authority of the national government to the side of communal approaches to child rearing over against the family-oriente- d approach. This was possibly the most notable accomplishment of the Nixon Administra- tion. But we have a new Administration, a new Congress and a new comprehensive child development bill. Whether the children of America will be saved from this time remains to be "Sovietizing seen. ), who inRep. John Brademas troduced the original monster and has reintroduced the current one along with 87 cosponsors, expects it to sail through the House. I think it should pass the House more last than easily time, Brademas says, with our 92 new members. Sen. Walter Mondale who introduced the Senate version, claims that the bill is voluntary and merely pro- (D-Ind- (D-Min- n), WRAPUP For performing his official duties of presiding over the Senate and telling the President what to do next, Vice President Nelson Rockefeller is paid $62,500 by the American taxpayers. Thats like giving a quart of Quaker State to King FaisaL Rockey writes more money than that off his income tax each year as charitable contributions to Mr. and Mrs. Henry Kissinger. The freshmen Democrats in Congress have unveiled their own "alternative solution to the energy situation. They plan to heat Capitol Hill offices with a lot of hot air. available workers in producing those things for which customers can and will pay the highest prices. If workers and investors will settle for the highest free competitive bids for their services, we can soon know prosperity as we have never known it before. The wolf is at the door. Attempts to trade off inflation and unemployment have reached the end of the road. We must promptly reject Budget policies that call for the creation of more dollars, higher prices, and more controls over the necessities of modern life. Let us rally to the cry of freedom - the economic freedom for all to compete in the market place in the greater service of our fellow men. April President Ford has not yet issued a . position on comprehensive child development. But his threat to veto any new spending programs leaves room for hope. But hope is not enough for parents who are not ready to give up rearing their children in an atmosphere of personal attention, love and respect, and turn this responsibility over to total strangers. Unless concerned parents bombard their Congressmen and Senators with pror tests, this frightening program will glide through Congress. Even if President Ford vetoes it, there are enough leftest votes to override a veto, thanks to big labors veto-proCongress. There is little doubt how the labor-bosse- d Congressmen will vote, since comprehensive child development is one of of COPEs favorite projects. Concerned, informed parents will want to contact their union leaders, as well as their Congressmen on this one. Anti-Gu- n Lobby Renews Efforts The lobby more accurately, Amendment freedom crowd have launched a two pronged attack aimed at stripping the American people of their constitutional right to keep and bear arms. Their latest ploy is to attempt to ban the manufacture and sale of all handgun ammunition. While one group of forces continue pushing laws banning handguns through Congress, another attack is being maneuvered through bureaucratic channels. The Consumer Product Safety Commission on Feb. 14, published a call for written public comment on. a petition demanding the banning the sale of bullets for handguns. The petition was filed last summer by the Chicago-base- d Committee for Hand Gun Control (111 the anti-gu- n anti-Seco- nd East Wacker Drive), but a hearing was denied by the Commission. The CPSC admitted then that its authority does not extend into this area. The U.S. District Court for the District of Columbia ruled in that the CPSC must consider the anti-bullproposal. The gun controllers claim that under the Consumer Product Safety Act of 1972, which was passed to protect the public against such things as flammable clothing, bullets are hazardous substances. . .that present unreasonable risks of injury. This incidious method of passing regulations, without direct congressional approval, has been used by other agencies to increase their power over the public. Once a proposal is published in the Federal Register, it can become de facto law within 90 days, if there are no public challenges. It there is wide public opposition, the agencies are supposed to take comments into consideration before establishing rules. mid-Decemb- er et JOHN R. RARICK Comments opposing the banning of handgun ammunition must be received by the CPSC before April 5. The address of the Consumer Product Safety Commis1 sion is P.O. Box 81 37, Washington, D.C. 20024. Unless concerned citizens let the bureaucrats know that they demand their right to keep and bear arms, this power grab could slide past. On the other anti-gu- n front, various laws banning the sale and possession of handguns are moving rapidly through Congress. chairRep. John Conyers man of the House Judiciary Subcommittee on Crime, which began handgun 19, sees a fairly good chance of enactment of strong gun control legislation this year. - There are more than 40 anti-gubills introduced in the House so far this session. During the first day of hearings, the subcommittee heard testimony from ), Abner Mikva Resp. Gilbert Gude (D-llla left-win- g former Congressman who returned to try again, Ronald Del-luBlack Panther party member from Berkley, and the District of Columbias black Delegate, Walter Faunt-ro(D-Mic- h), hear-ingsFe- b. n (R-Md- ), ms (D-Calif- ), y. Fauntroy laid the blame for the excessively high rate of murders in D.C. on the availability of handguns. In the District of Columbia, he told the subcommittee, the leading cause of death for males under the age of 40 is firearms. Homicides in the nations capital reached a record 295 last year, 158 were by handguns. As a former resident of the Washington, D.C. area, I must agree with Del. Fauntroy that it is unsafe to walk the streets at night. The danger does not come from the fact that there are too many handguns. The problem is that there are too many criminals with guns in D.C. Liberal judges have for years turned outlaws lose to prey on the law abiding public. A recent case in the District was shocking proof of hew far this permissiveness has gone. An off-dut-y D.G policeman murdered his mother-in-laand seriously wounded his wife in a premeditated shooting spree. While his wife was still bleeding in the emergency room, the cop was released by a local judge. He did not even have to post bail. It has been said many times, but it bears repeating: guns and bullets dont kill people, people do. Unless the courts clamp down on gunslingers, the homicide figures will continue to climb. And no amount of gun control will prevent it. The activites of the anti-gu- n lobby is continuing full speed ahead. Youve A Right To Know will continue to report on the activities of these w Court Gives IRS Vost New Powers Washington, D.C- .- In a sharp detour from protecting the right of individual privacy from the prying eyes of big government, the Supreme Court has empowered Internal Revenue Service agents to seize and search your bank records without first obtaining a search warrant. The decision to allow IRS agents to make a shot in the dark summons of bank records without identifying their target, came on a vote, with Justices Douglas and Stewart dissenting. Justice Stewart declared, Any private economic transaction is now fair game for forced disclosure if any IRS agent happens in good faith to want it disclosed. If Watergate has taught us nothing else, we should have learned that excessive power in the hands of any government agency can lead to abuses. Apparently, the High Court wasnt paying attention. If Congress really wants to investigate gross violation of Constitutional rights, it should turn its attention from the CIA and look into the activities of the IRS. -2 |