The American Freedom Network

Who Will Be the Next Scapegoat?

     Protesters are harassing AIG executives at home.  We know that the scapegoating of AIG, as if their mismanagement of a private company, now on welfare, single-handedly destroyed the American Dream, is intentional, as the Alinskyite in the White House and his allies seek to divert attention from their revolutionary socialization of America. 
     The AIG Tax that passed the House, aside from being an un-Constitutional ex post facto law, as well as an un-Constitutional bill of attainder, is clearly an attempt to scapegoat financial capitalism in general, and AIG in particular, for the current crisis.  Granted, AIG was mismanaged.  Also granted, however, is that moral hazard was introduced by our government by means of their offering insurance of varoius kinds to bankers and financiers, and by bailing them out, rather than letting them fail.  Also remember that a free economy depends on the price mechanism to send all who take part in it signals concerning value:  Present value as represented by any price that a buyer and seller agree on, future value as determined by interest rates, et cetera.  Distortions to prices caused by non-market changes to the unit of valuation – money – lead to distortions in calculations based on money.  These distortions lead to asset bubbles forming, and when they burst, then the boom-and-bust cycle works out the misallocation of resources by means of liquidation. 
     That process is short-circuted when a non-market actor – the federal government – steps in to reqard failure by subsidizing it with the wealth of the wiser, more successful or luckier members of society.  Knowing this is likely, as was the case with the S&L crisis of the 1980s, financiers arfe tempted to aim for higher rates of return, accepting the increased risk they otherwise wouldn’t, because someone else will pay for it in they fail.  Even if a specific bailout is not offered, the use of credit expansion to create money out of thin air, as the Fed just did by announcing an additional $1 trillion (!) in Treasury bond purchases, the bursting bubble is replaced by another one.  So, either because of interference with price mechanism by means of currency manipulation, and by means of introducing moral hazard, the government acts to misallocate resources, and to prevent the consequences of said misallocation from working themselves out naturally.
     The result of this de facto currency devaluation will be inflation.  The whipping up of popular frenzy against AIG over executive bonuses authorized by Congress when it bailed them out is a ploy.  (Hypocritical, too, and self-interested, since SEN Dodd, who inserted the bonus language into the bill that no one read, is from Connetticutt, home to much of the insurance indusrty.)  Since they’re travelling down the road of scapegoating anyone who is not their ally (and too weak to defend themselves), one may ask:  Who is next, and how severe will the legislated hate become? 
      Perhaps we should consider saying, “I Am Joe” when the Obama Administration slanders the business class of this country, when it decides to confiscate unlawfully, when it decided to “share the wealth” with more-favored constituencies.  Whether lowly plumber or AIG executive, no one appears to be safe from the ruthless abuses of Obama and his allies in Congress.  It’s AIG today, the rest of us soon enough.  If we don’t hang together, we may well hang separately, to paraphrase Benjamin Franklin.  It’s time to organize, to petition, to tell them, “No!” as loudly, as often (and as politely) as you can, before the situation is lost.  Better the crisis be faced by us, as Thomas paine remarked, if it means that our children can live in peace afterward.