"Wherefore We must interrupt a silence which it would be criminal to prolong, that We may point out...as they really are, men who are badly disguised." Pope St. Pius X, September 8, 1907, Pascendi Dominici Gregis


Saturday, July 13, 2019

Watch and Pray



Watch ye therefore, because ye know not what hour your Lord will come. But know this ye, that if the goodman of the house knew at what hour the thief would come, he would certainly watch, and would not suffer his house to be broken open. Wherefore be you also ready, because at what hour you know not the Son of man will come. Who, thinkest thou, is a faithful and wise servant, whom his lord hath appointed over his family, to give them meat in season. 
Blessed is that servant, whom when his lord shall come he shall find so doing. Amen I say to you, he shall place him over all his goods. But if that evil servant shall say in his heart: My lord is long a coming: And shall begin to strike his fellow servants, and shall eat and drink with drunkards: The lord of that servant shall come in a day that he hopeth not, and at an hour that he knoweth not: 
And shall separate him, and appoint his portion with the hypocrites. There shall be weeping and gnashing of teeth

Thursday, March 28, 2019

Obligatory Public Correction

Needless to say, this at long last official opinion of a Bishop ought to supersede any of our contrariwise speculations, apparent or intentional, expressed here in the past.


Thursday, November 8, 2018

Not A Liturgical Bit of Difference

Tridentine mass in Old Slavonic? Western rite Orthodoxy? Eastern rite Catholicism? Apparently the East and West making use of each other's liturgical forms predates post-conciliar insanity. With this insanity rightly besieged with the evidence of what's long behind it in the West, and the East now lacking a proper "Ecumenical Patriarch," perhaps it's time for that ultimate ecumenical act of the Pope consecrating Russia in union with all of the bishops of the world to the Immaculate Heart of Mary. Or are we not so keen on ecumenism after all?




Monday, October 29, 2018

The Debate of the Century


Everything of import in modern political discourse finds its place in this debate. Americans, who are now undermining the last vestiges of their unique contribution to world history, a balanced fusing of traditional cultures with the larger acultural or supra cultural project of a free-enterprise system, are carrying out the self-destructive phantasies of their pre-1989 Russian enemies, while driving the current leadership of that country into the very moral space they are vacating. To Olavo de Carvalho, in his debate with Aleksandr Dugin, this process is the height of geopolitical irony. What is most intriguing is the extent to which both intellectuals make explicit the spiritual tensions in their otherwise academic discussion. A more nuanced question, to which Carvalho later comes, is whether the intention has always been to one up the errors of Russia in the West. Conversely, as Dugin's reply suggests, we are not yet convinced that a "sobornost" conception of society cannot be accompanied with certain concessions to the imperative of economic calculation. Reading between the lines is the most exciting part. Those who adhere to Misesian insights, while retaining skepticism that post-1960's social transitions mark Fukuyama's end of history, would do well to seek the synthesis of Dugin and Carvalho, a strategic recombination of the remnants of Christianity, Conservative Nationalism and Libertarian Individualism slated for destruction in the West with a Russian centric Eurasian wholism standing against the destruction of archetypal social mores. Interestingly enough, Carvalho mentions the prerequisite to such a geopolitical game changer early on, "the Pope and all Catholic bishops of the world would perform the rite of consecration of Russia." A reunion of East and West would also free the Orthodox Church from the prisoner's dilemma of Caesaropapism in which "choosing to be an imperial religion, [she] condemned herself to either remain imprisoned within national borders, or begin a world war." Let us hope that the remnant of right thinking Catholic prelates can recognize the imperative to coordinate mutual cooperation before the Nash equilibrium between the Globalist-Atlanticists and Moscow sets in.

Saturday, October 27, 2018

The Post-Secular Moment


Those interested in preserving growing standards of living ought to welcome attempts to find traditionalist groundings for market institutions and practices, even as just a contingency. Open hostility to such a project seems to betray motives other than the general welfare.

Saturday, October 20, 2018

When West Meets East

On balance as a primary beneficiary, although wholly inadvertently and until later in my life naively, of the current geopolitical and economic order, I will avail myself of this inside view of the ruptures in cultural fabric that American hegemony has visited on us especially in the West, especially in America.

There ought to be little debate that one essential feature of the constellation of American command and control is her central bank which issues the de facto world reserve currency. From the Trump administration's recent assertions that the American legal regime has jurisdiction to review any dollar denominated transaction in the world including those carried out between two foreign parties, to Western and Eastern European counter-assertions that an alternative to the US swift international monetary transfer system ought to be built to circumvent it, to over half of Japanese exports to the world (not the US) being denominated in dollars, to foreign central banks creating domestic liquidity in direct response to Fed easing in order to avoid dramatic increases in the value of their currency vis-a-via the dollar there is no shortage of grist for the US dollar mill.

It is perhaps the last point that has the most erosive societal consequences. With even countries like Switzerland living in fear of a US liquidity tsunami stripping away any relative export advantage they possess, those whose livelihoods are expressed entirely in dollar transactions always have an edge in obtaining the best export goods first.

The process of globalization of the last fifty years has been a primary expression of spreading this dollar centric order to the whole world. Apologists sugarcoat this phenomenon exclusively in terms of an expanding division of labor. Fair enough. If that were the whole story there would be no reason for this article and I would remain enamored with the American role in history, as I believe, would most.

The cultural capital that catapulted the US dollar to its post-war position is now exhausted. Other forms of capital remain, but the vision of a beneficial or even benign US dominance has given way to naked self-interest, the American work ethic although attempting a resurrection can never regain the luster it had under the present regime of corrosive narcissism and we need not even mention the American tradition of thrift - today a penny saved is a penny wasted.

The erosion of social norms I have witnessed since 1985 and with it America's cool self-confidence has given way to the enculturation of "full spectrum dominance" where the hollow husked buzz words of the American past and present are uttered with such speed, obnoxious force, apparent moral suasion and strategic vagary so as to shock and awe the average concerned citizen back into a passive, if anxious, ride on one of those trains of earlier American lore hastening to spill headfirst off a bridge into the desert canyon below.

Is there any hope? Not that I see for those enthralled to American oligarchs. The liberal end of history has come. But history goes on. True progress, ever dependent on virtue, will have to be taken up by another, until now, less assertive cultural tradition, hopefully one with root-stock closer to the Christian norms to which even American cultural norms were once grafted.

Raised on the lore of "go west, young man" and Cold War notions of the inherent inferiority of the collectivist Eastern mindset, it is more than a transition to realize that much of the hope I have for progress is sprouting from exceedingly alien origins to this native Texan. To hear Russian politicians taking up the use of Christian rhetoric in such stark terms as to render American notions of their city on a hill a verily pallid color indeed is a strangely freeing counter-cultural experience.

Eastern Christiandom, with its year round penchant for what in the West are "Easter colors" along with the constant refrain "Slava Isusu Christu" lends a perennially festive air which, although once was, is completely comatose in the Western Church. Of course, Western Christendom itself is long dead, humanly speaking, strangled finally by the same pederasts responsible for the new aggiornamento springtime and the teenlife liturgy of the post conciliar age.

A redeeming glimmer in the collapse of Catholic faith and power are strangely enough not the physical churches themselves, which Westerners hold alternatively as nice places to attend a concert or the starkest examples of the plague which is modern architecture, but a small grass-covered mound of dirt on which four statuettes are placed outside many Catholic Churches in South Texas and throughout the world.

There upon is silently recounted the greatest prophecy of modern times. That when Western Churches would stand as empty as their counterparts in Communist Russia and the socialization of capital would threaten the stability of the entire world, that when the notion of Schism would be revisited in the East and all looked dire and hopeless in the West, this would be the very hour of Her Victory.

"The Holy Father will consecrate Russia to me, and she will be converted, and a period of peace will be granted to the world."

Now for a more reserved tone. These are the tentative speculations of an overactive imagination. What the Western elite sees in Russia, a vast land of unexploited natural resources, is not altogether different from the American position between the Civil and World Wars. If Russia can in Christian form conceive social institutions wherein a broad, ethically bound middle class emerges from her economic patrimony she will displace the overly commercially reliant and pervasive American mass culture. What is absent today are not the failures of American cultural hegemony, but a morally superior alternative.

If bourgeoise values of capital accumulation, common decency, patriarchy, admiration for others' success can converge with the level of trust and cooperation implicit in the Eastern communitarian mindset, then the capitalist successes of the American golden age can and will be superseded. What will this look like? Is such a synthesis possible?

That is up to Heaven and the Russian people.

Thursday, October 18, 2018

They Told Me

...Christian doctrine no longer has a role to play in the political sphere.



Wednesday, October 17, 2018

Narrative Imperitive


People need a narrative. People need a story. It is too difficult for most people to deal constantly with abstractions. One or two for the day and they disengage. Rationalism does not provide a narrative - or - insofar as it did, that narrative, Fukuyama's end of history, died. Quite quickly. Liberalism triumphed. Who debates it? But history continues, even in the era of post-modernism.

Artificial narrative or mass LARPing can never suffice. No one is willing to sacrifice themselves for these. Robust narratives have two sources. The Church or the State. Whatever one thinks of the tragedies of the Church, at least in the West, they pale in comparison to those under states powerful enough to enforce a narrative. Nassim Taleb's point seems unassailable. It is incumbent on those who would supplant the Church to create a more viable replacement first. This must be more viable on multiple fronts, plausibility, lowering the costs of self-regulation in upholding basic civilizational norms, continuity, etc. The likely reality is that the Church will be as good as it gets in this vale of tears, and any attempt to move beyond it will always end in utter failure or a totalitarian Utopianism.


Saturday, October 13, 2018

East In Crisis, West In Crisis


The margins for negotiation seem to be widening as well as the costs of putting off a settlement. While the Western Church clearly finds herself in what may be the greatest crisis of her existence, the East too, at least in terms of its uniformity since the Great Schism, is facing fundamental disruption.

Western political power threatens to finish off what little influence survives societal trends in the Patriarchate of Constantinople. The Father figure of Orthodoxy is conspiring to recognize schismatic Ukrainians vis-a-vis the Church of Holy Rus (including Ukraine), contrary to both tradition and the desires of the hierarchy of the later.

Little should be repeated, for our purposes, of the gross abuse of authority in the West. Suffice it to add only that with the near-apostasy of Francis and the questions of duress surrounding Benedict's resignation, one is not exactly sure who is fit to carry out the Western side of an ecumenical negotiation between East and West. Perhaps only our Lady's requested consecration, finally consummated, can address this.

But the mutual compatibility ought to be clear. The Catholic Church needs Orthodoxy to preserve its disintegrating universalism, or, catholicity. And Orthodoxy, whose internal structure is now being exploited by her enemies, is in dire need of Catholicism to preserve with unassailable authority an orthodox set of norms against which even the gates of Hell cannot prevail.

The situation is in flux. Surely Western policy makers are not so brazen that they will turn a blind eye to the spiritual implications of certain geopolitical maneuvers.(?) Even if they are, fate is not set. Many religious authorities also need to come to a deep and accurate contemplation of the source of gross and increasing divisions in once-Christendom.

Is it mere coincidence that such momentous decisions are visited upon us on the October 13 anniversary of Fatima?


Wednesday, October 10, 2018

The Orthodox Sacred War Against Freemasonry


While the notion of a Sacred War might seem an exercise of poetic license, the same stumbling block persists for those who would consolidate the statist order of post-Enlightenment Europe. The first two attempts stalled on the fields of the Northern European plain. If today's Ukraine is any indication the geopolitical calculus for European Integrationists is little changed. 



Tuesday, October 9, 2018

Is Efficiency Sufficient?

Whatever one thinks of the effectiveness of Western economic methods, they are not likely sustained over centuries in culture where the Kavanaugh brouhaha becomes representative of social norms. This is the thesis of none other than Francis Fukuyama, whose apostolic zeal for liberal democracy goes so far that he sees its triumph as the "end of history." In his more circumspect work on social trust and common courtesy, he reasons that as these erode the cost of interacting through market institutions begins to rise. In their entire absence arguably it is only a matter of time before capital consumption outstrips formation and time preference accelerates. In this respect decades from now poor Westerners may be looking towards a more traditional, stable East, scratching their heads trying to understand how the less "efficient" system became in time the wealthier one.

It does not seem a stretch to wager that making a cohesive system more productive is generally easier than to turn a system centered primarily on efficiency into a cohesive one. Time will tell if Western society is successfully remaking its social norms out of whole cloth or if the fraying at the ends portend an unraveling.

Friday, October 5, 2018

Schism In Triplicate



The rather obscure internal workings of the Orthodox Church may appear to today's secularized citizenry no place to search for geopolitical inflection points. But this is not the mundane, long dormant fault line it might first appear. Equally obscure perhaps is the current supposed father figure of Orthodoxy, first among equals, the Patriarch of Constantinople (today's Istanbul), who is held in near hostage status in his residence by the vast Muslim, Turkish populace, where the few (Orthodox) Greeks that remain barely retain the status of citizens. It is further doubtful that the Patriarch would have any political standing whatsoever if US foreign policy influence over Turkey were not brought to bear.

Truly, it seems, the Patriarchate in Constantinople is a captured institution on multiple levels and this has just been revealed as, contrary to century long Orthodox practice, the Patriarch has dared to involve himself uninvitedly in an internal affair of the Russian Orthodox Church. Though first in honor, there is no precedence in the East for such action, as the Patriarch is not seen to hold plenary jurisdiction over the Church as the Pope does in the West.

The Orthodox Church in Russia and Ukraine have long remained the same entity, even with the seat of the Church moving between Kiev and Moscow. Now with US inspired political machinations in Ukraine increased in a bid to undo Russian influence it seems even the Church, both in Constantinople and Kiev, is used merely as another tool in the foreign policy toolkit.

In short, the Patriarch of Constantinople is threatening, contrary to all Orthodox practice, to recognize Orthodox believers in Ukraine as an entirely separate entity from the Russian Orthodox mother Church to which she has long belong.

Such a schism, or split, in the governing structure of the Russian Church is momentous on many levels, not least of which has been the response of the Russian Church in no longer commemorating the Patriarch of Constantinople in its liturgy. Thus leaving the Russian Church, the largest branch in Orthodoxy by population by far, without an apostolic figure or father uniting it to the rest of the (non-Protestant) Christian Church.

That dual schisms, Ukrainian from Russia, Russian from Constantinople, would result from US meddling in Ukraine only serves to twice underline the greater fault line in Christianity, that of the East and the West of about 1054. While efforts are underway to smooth out these apparent ruptures in Eastern Orthodoxy, one wonders if in a world where secular political considerations tend to out weigh in the immediate term long held clerical practices Orthodoxy would not fracture further in the very attempt to prevent any unraveling.

Thus it appears a more serious Russian Church will find herself somewhat in isolation, afforded time to contemplate what truly has led to her separation from daughter Kiev, mother Constantinople, and perhaps most portentously, father Rome.

It is fashionable to pretend otherwise, but one hundred years later prophecy still hangs so thick in the air, one ought scarcely need a reminder to repeat

Our Lady of Fatima, pray for us.

Thursday, July 12, 2018

The Market & The Curse of Material Prosperity

We have much to clarify as we delve into the substance of this post. Certainly we are not suggesting that material prosperity is a curse per se. What is missing is a healthy indifference to materialism.

The real curse is socialism. Why won't it go away? No system has been tried so many times and failed so many times. It should be, and is at least intellectually, a forgone conclusion that it does not work. Yet, it remains an answer to a question society repeatedly asks itself: what are we to do with all this wealth the market has created?

This is the question that underlies nearly every discussion made by proponents and detractors of the market. The argument nearly universally advanced is the market creates the most wealth. And this much is true. But it is merely a side-effect of the market, and not the justification for the market per se.

The free market is a set of institutions that first emerged during the Middle Ages which recognized self-ownership, responsibility, private property and the morals of Catholicism as norms. The market is truly a moral order first, and to smear it with crediting to it the material benefits it produces alone is a crime. The free market is a moral good, per se. And it is fitting that it should produce a prosperous society. But the prosperity is not to be desired for its own sake. This will always lead us to socialism, wherein those who have not achieved certain standards of right action are nevertheless materially rewarded as if they had. If we desire the effect of material prosperity absent its moral aspects for everyone, socialism must result.

Thus, the curse of modern man is his lack of indifference to the wealth that surrounds him. The more he focuses on the wealth itself, the habits and institutions that produce it will disappear. The free market and its fruits are first and foremost an institution of right character and not pure materialism.


Tuesday, July 10, 2018

The Political Left Is Ugly; The Political Right Is Ugly Too

It's fun to watch the liberals meltdown. That's when you keep your eyes on the conservatives.

A timeless lesson from Ron Paul.



It's tempting as someone who values some sense of order to jump on the liberal lambasting bandwagon. Just look at those poor pathetic fools, dreaming of their long discredited socialistic paradise, a world where all incentives to act in a civilized manner are destroyed, and no one is sure what gender he even is.

That's when you have to keep your head above the fray. As we've outlined before, popular conservative figures in America have the function of power consolidation, instead of overturning the liberal attacks on society as you might think (or hope). So, you get to make fun of liberals for four (or eight) years, but you still end up in a country where all incentives to act in a civilized manner are [a little more slowly] destroyed, and [an increasing number of people are not] sure what gender they even are.

 "The Radical Center" is the ultimate, more hidden source of the West's oh-so-slick, glossy and eloquent self-decapitation at the hands of what appears expedient for a brief moment in history, while the destruction of all the West ever meant continues unabated. There's nothing conservative about this at all.

It's great to see Ron still at his finest in this most recent YouTube video.

If you are concerned by this dynamic, the posts of Charles Burris at LRC Blog are apropos:

Michael J. Glennon’s book on the dual nature of the American government, National Security and Double Government, is one of the most disturbing and disconcerting I have ever read. He posits that there is the “Madisonian” public government of the legislative, executive, and judicial branches found outlined in the Constitution, operating under the rule of law, with separation of powers, checks and balances, and openness and transparency.  This is contrasted with the “Trumanite” clandestine deep state, established by the National Security Act of 1947 during the Truman regime. On every page he uncovers virtually unknown material in intricate detail and in such depth as I have never encountered before.

The section in the book concerning the federal judiciary absolutely blew me away. In particular how he detailed the “Trumanite” background of Supreme Court appointees and how they were vetted for their deferential views on “national security” while the establishment media presstitutes focused upon diversionary “hot button” issues such as abortion, women’s and gay “rights,” gun control, etc. I believe it to be the most powerful section in the book.

When the formal review process for the next Supreme Court justice is underway, it is imperative that the American people not acquiesce their grave responsibility but forcefully press their elected Senators and the news media to question and hold fully accountable the nominee for their viewpoint on vital national security issues such as the Constitutional power to declare war, Habeas Corpus, warrantless detention, warrantless surveillance, torture, rendition, national security letters, and the constitutionality of Continuity of Government (COG) and covert operations of the intelligence agencies.
Does the judicial nominee hold that the Constitution established a federal decentralized compact or republic of sovereign independent states granting explicit delegated powers to the general government for specific purposes while retaining their reserved powers for themselves? Or does the United States simply pose as a sham elective democracy but is in fact a militarized despotism with actual power residing in the hands of a secret oligarchy that is arbitrary, capricious, and unaccountable, a tyranny lacking transparency, justice, or restraint?

You could always share these sentiments with your Senator, who will vote on whether to confirm the nominee.

Tuesday, June 26, 2018

The Question of Usury Finally Addressed



As Guido Hulsmann explains, the category of usury applies more to a corrupted form of commerce operating outside the norms of the free market [like the one we have today], than the market itself. With private property and other elemental matters of justice upheld, usury becomes a non sequitur. Guido makes this clear within the very Aristotelian-Thomistic framework the Church has long championed.

A little overdue, but, Brian McCall please call your office. - Not that McCall is critically wrong in his analysis itself, but this should alleviate some of his confused antagonism towards Tom Woods and the like.

Monday, June 25, 2018

Social Atomization Is A Process of Statism, Not Capitalism


What social phenomena account for the increasing loneliness and psychological disconnectedness of modern society? This is actually a very simple question, but as is typical of modern ‘teaching birds to fly’ so-called intellectuals, the canned answer propagated is both the inverse of the truth and the one that soothes the status-anxieties of intellectuals who like to blame all social ills on the very system that most readily alerts the rest of humanity to the lack of remunerable talent the typical intellectual has to offer.

Capitalism has very little to gain from increasing societal atomization. In fact, most businesses would benefit from dealing with people in groups. One need not go much further than looking to the discounts provided to larger volume customers – insurance companies for instance provide group pricing discounts that demonstrate their preference for dealing with people in groups rather than as individuals. Groupon has turned this into its specific business model. This type of efficiency can be found throughout all industries. Any business dealer would prefer a larger volume of purchases combined with the reduction in interactions that customer-groups entail. It shouldn’t matter if we are talking about tribes, extended families, nuclear families, clans, church groups or spontaneous flash mobs, assuming they are peaceful customers, business owners will realize time, cost and volume efficiencies in dealing with organized groups rather than individuals.

Here the socialist-minded intellectual will interject, in Freudian slip fashion, that this ignores the labor side of the equation. Businesses would prefer a world of single men and women who compete for jobs ruthlessly against each other, no consideration given to family or relational concerns. But there are ample replies to this contention. For one, if society cohered more of groups as we discussed in the last paragraph, then there would be in general less need for, at a minimum, sales labor in the first place. Second, unlike the cartoonish account of society given by socialists, entrepreneurs and business owners are not a stratified class of “capitalists” “at war” with working people. These capitalists, small time bourgeois among them, are themselves customers, laborers and members of the groups in question in turn, if not concurrently. Few are the capitalists that think of labor as something to be broken down and reconstructed; more common are those who will themselves place their group and social identities as higher than their position as capitalist, unless incentivized from the outside to do otherwise. And this brings us to the most fundamental point: the norms of capitalism do not allow big businesses to forcibly tear down the family, or uneconomically provide the types of functions that have long been and are more effectively provided at the group level. If private property rights are upheld in the broadest and strictest sense, limiting the spheres of state coercion, there is little capitalists can do to change familial and group relationships, and anything they endeavor will, as above, come as a cost to the business rather than tend to increase profits.

We can admit in capitalism there are no clear incentives to the destruction of the family and other social groups. The multiple effects of the destruction of the family will play out in different ways, favoring and disfavoring various parts of various businesses as it goes.  That capitalists themselves will come from and remain parts of various groups from the start will serve as inertial force against any business that would attempt to parlay profits into some kind of social project. And businesses themselves increase their profits in general by dealing with people in groups rather than individually.

The state, on the other hand, as an entity that by its very nature claims a monopoly of some form of minimal allegiance from the people within its geographic area of operation, would have many reasons to oppose in near paranoid fashion the formation of potentially competing groups. The state will often attempt to separate groups to its liking; those that show a willingness to cooperate within the state’s parameters are often granted tax and other legislative benefits, while those groups that demonstrate a willingness to remain aloof, independent or even attempt to displace the state by providing similar “services” are often ruthlessly destroyed. Moreover, the state is the only social entity that claims it can "legitimately" take resources from other social groups without their permission. If there is any truth to the assertion that the largest capitalists benefit in terms of labor cost from increasing social atomization, it would be hard to see how we have arrived at our present predicament without state subsidized education, welfare and child support benefits offered by the state to “single” mothers, social security, Medicare and Medicaid. Functions that any natural society long placed in the hands of groups – usually extended families – have slowly but surely by legislative means been handed over to the state – education of the young, support for the elderly and infirm, even providing for children have all been increasingly monopolized by the state to the disadvantage of groups of all kinds.

The evidence abounds – complete social atomization is and can only be a product of statism. While businesses themselves rely on other functional social entities at some level for their own continued existence – customers, suppliers, investors, etc. – the state is the only institution that can monopolize all of these functions crowding out all other groups and creating a “society” that exists only of itself. Today, the state even compounds this, in that it attempts to alienate from itself, already attempting to monopolizing the entire social sphere, anyone who demonstrates any compunction contrary to its campaign of increased social atomization. It's mantra seems to be: all are acting in concert to be atomized, so we would tell you to get out if we weren't demanding that you stay in. Truly this is institutionalized social pathology.

Sunday, June 24, 2018

America To Finally Trade Ex-Dividend?


At the collapse of the Soviet Union in the early 1990’s there was much expectation that benefits would accrue to the East and the West. And while many of the nations of Eastern Europe received their peace dividend, successive administrations of Bushes, Clintons and Obamas ensured the United States would not withdraw her worldwide military presence nor receive her share of the post-Cold War savings. 



That is until now, if there is any truth in this. According to Max Keiser, Trump is planning to finally deliver the long overdue peace-dividend advocated by staunch conservative voices like then Congressman Ron Paul by “reduc[ing] defense spending to pare the huge US debt.” To make the title clear generally when an investment trades on the market “ex-dividend” pre- existing shareholders become entitled to a payout. If Trump successfully arranges a withdrawal from our unnecessary overseas military presence, his plan includes “allocat[ing] part of the defense-spending-cut dividend to stimulus programs, pushing credit opportunities for small and medium-sized enterprises and infrastructure spending.”


And while we’re sure Congressman Paul would have preferred straight up tax cuts to leverage-inducing “credit opportunities,” we could all rest assured that the world will have taken a step back from things like unnecessary nuclear confrontation.


The RT article indicates “cutting the Pentagon budget in half will cut the stock market in half and cause a short and sharp recession in the US.” This is certainly possible given the amount of excess liquidity in the system today. But an economy is more than stocks and numbers like “GDP” are just that – numbers, subject to all sorts of gimmicks and distortions.


Keynesians too would predict a massive recession with the end of government spending on World War II in the late 40’s and early 50’s, but while this happened on paper, the average American experienced nothing but boom times. This Mercatus article explains:


In 1944, government spending at all levels accounted for 55 percent of gross domestic product (GDP). By 1947, government spending had dropped 75 percent in real terms, or from 55 percent of GDP to just over 16 percent of GDP. Over roughly the same period, federal tax revenues fell by only around 11 percent. Yet this “destimulation” did not result in a collapse of consumption spending or private investment. Real consumption rose by 22 percent between 1944 and 1947, and spending on durable goods more than doubled in real terms. Gross private investment rose by 223 percent in real terms, with a whopping six-fold real increase in residential- housing expenditures.

The private economy boomed as the government sector stopped buying munitions and hiring soldiers. Factories that had once made bombs now made toasters, and toaster sales were rising. On paper, measured GDP did drop after the war: It was 13 percent lower in 1947 than in 1944. But this was a GDP accounting quirk, not an indication of a stalled private economy or of economic hardship. A prewar appliance factory converted to munitions production, when sold to the government for $10 million in 1944, added $10 million to measured GDP. The same factory converted back to civilian production might make a million toasters in 1947 that sold for $8 million—adding only $8 million to GDP. Americans surely saw the necessity for making bombs in 1944, but just as surely are better off when those resources are used to make toasters. More to the point, growth in private spending continued unabated despite a bean-counting decline in GDP.


While vested interests always attempt to scare Americans into thinking any government spending cut will spell economic shrinkage, the truth is just the opposite. A decrease in government spending can free up resources to entrepreneurs and consumers, who if they act prudentially can begin to grow the economy in ways that benefit everyone not just arms-dealers and politicians.