Change In Politics

Br Dr. Thomas Sowell

One of the few political cliches that makes sense is that “In politics, overnight is a lifetime.”

Less than a year ago, the big question was whether Rudolph Giuliani could beat Hillary Clinton in this year’s presidential election. Less than two months ago, Barack Obama had a huge lead over John McCain in the polls. Less than a week ago, the smart money was saying that Mitt Romney would be McCain’s choice for vice president.

We don’t need Barack Obama to create “change.” Things change in politics, in the economy, and elsewhere in American society, without waiting for a political messiah to lead us into the promised land.

Who would have thought that Obama’s big speech at the Democratic convention would disappoint expectations, while McCain’s speech electrified his audience when he announced his choice of Governor Sarah Palin for his running mate?

Some people were surprised that his choice was a woman. What is more surprising is that she is an articulate Republican. How many of those have you seen?

Despite the incessantly repeated mantra of “change,” Barack Obama’s politics is as old as the New Deal and he is behind the curve when it comes to today’s economy.

Senator Obama’s statement that “our economy is in turmoil” is standard stuff on the left and in the mainstream media, which has been dying to use the word “recession.”

Not only has the economic slowdown failed to reach the definition of a recession, the most recent data show the U.S. economy growing at a rate exceeding 3 percent– a rate that many European economies would die for, despite our being constantly urged to imitate those countries whose end results are not as good as ours.

Barack Obama’s “change” is a recycling of the kinds of policies and rhetoric of the New Deal that prolonged the Great Depression of the 1930s far beyond the duration of any depression before or since.

These are the same kinds of liberal policies that led to double-digit inflation, double-digit interest rates and rising unemployment during the Carter administration. These are “back to the future” changes to economic disasters that need repeating.

Make no mistake, the political rhetoric of FDR was great. For those who admire political rhetoric, as so many of Barack Obama’s supporters seem to, FDR was tops. For those who go by actual results, FDR’s track record was abysmal.

Although the Great Depression of the 1930s began under Herbert Hoover, unemployment during Hoover’s last year in office was not as high as it became during each of the first five years under FDR.

During the eight years of FDR’s first two terms as president, there were only two years in which unemployment was lower than it had been under Herbert Hoover– and not by much.

World War II has been credited by some with getting the United States out of the Great Depression. What the war did was put an end to the New Deal, as national survival became the top priority and replaced FDR’s anti-business and class warfare rhetoric.

Senator Obama’s rhetoric today is the anti-business and class warfare rhetoric that worked so brilliantly in a political sense for FDR in the 1930s. But Obama is following an opposite course from FDR when it comes to recognizing threats to American national security.

Senator Obama has repeatedly tried to deal with national security threats with rhetoric. He tried to dismiss the threat of a nuclear Iran with because Iran is “a small nation”– even though it is larger than Japan, which launched a devastating attack against the United States at Pearl Harbor.

FDR had the good sense to begin urging greater military preparedness in 1940, more than a year before the United States was attacked. He said, “If you wait until you see the whites of their eyes, you will never know what hit you.”

Cutting the military budget and taking foreign policy problems to the United Nations are Obama’s version of “change.”

That is change that we dare not believe in. It is the audacity of hype.

Jim Wallis and Barack Obama: On Common Ground

by Joel McDurmon This article is an abridged version of my 30-page REPORT: “Obama’s Agenda Inside Evangelical Churches For the full 30-page FREE report, click here. Religious thinkers and activists like our good friend Jim Wallis and Tony Campolo are lifting up the Biblical injunction to help the poor as a means of mobilizing Christians against budget cuts to social programs and growing inequality. — Barack Obama On August 16, 2008, Pastor Rick Warren hosted sequential cross examinations of Barack Obama and John McCain. He asked hardball questions that are of major interest to members of Protestant evangelical churches. He forced them to talk straight about the evangelicals’ agenda. This is as it should be: bi-partisan cross examination. They came to his party; he did not come to theirs. This is completely different from ideological allies of either Obama or McCain coming into local congregations and promoting their candidate’s agenda in the name of the Bible, when in fact the Bible teaches the opposite of what their candidate says he stands for. Yet this is happening today. To perceive what is going on, evangelicals had better be aware of three things: (1) what the Bible says regarding some crucial issues; (2) what the candidates are saying on these issues; (3) who these candidates’ allies are inside the churches, and how they are misusing the Bible to promote their candidates’ positions. I begin with Barack Obama. His allies are more forthright, and they have maintained their positions for years. It is not so much that they are outright promoters of Barack Obama. It is that they have long been promoters of ideas that he espouses, and he just happened to win the nomination this year. Whether he wins or loses, his allies will continue to promote these ideas in the churches. That is why evangelicals need to understand who the allies are, and what they are promoting in the name of the Bible. When liberal commentator “Rev.” Barry Lynn heard that Obama accepted Warren’s interview, he lamented it as a “big mistake” and said, “Barack Obama should not have agreed to do this.”1 Why? What do religious leftists like Lynn fear that Obama might say? We can’t be sure, but from what he already has said we get a pretty dark picture. What follows is a report of how liberal religious leaders have promoted and continue to promote their agenda in the name of the Bible. The Audacity of Deceit Baptizing the leftist political agenda in Christian language is nothing new. For theological liberals it has been the norm for a century, ever since the liberal philanthropist John D. Rockefeller began financing the “Social Gospel” movement in the 1890s. Rockefeller was enamored by the liberal preacher Harry Emerson Fosdick; he made him a Trustee of the Rockefeller Foundation and also hired his brother Raymond who subsequently ran the Foundation for forty years. In return for Fosdick’s services Rockefeller funded the construction of the famous Riverside Church in New York which has since been described as “a stronghold of activism and political debate throughout its 75-year history.”2 Continuing the wedding of liberal politics with a Christian façade, the latest minister of Riverside Church, Rev. Dr. James A. Forbes, was invited to address the 2004 Democratic National Convention. Hardly a Forbes talk goes by in which radically liberal politics is not wrapped up in the swaddling clothes of twisted Bible passages. While speaking at an Awards ceremony for the National Gay and Lesbian Task Force, Forbes called the Bible “homophobic” and said that “the institution of marriage is in danger of losing heaven’s endorsement” if the United States does not affirm and sanction gay marriage.3 Continuing the tradition of leftist politics, Forbes calls for every measure of government welfare under the guise of “Human Rights” and appeals to the Bible’s concern for poor to support government taxation. When U. S. political policies do not line up with his agenda, he accuses us of national hypocrisy. Reading the well-known passage from Matthew 7—“Judge not . . .”—Forbes adds, “Sounds like that is addressed to the United States of America.”4 Everyone has heard about Obama’s mentor and pastor of 20 years, Jeremiah Wright, who ended his pro-black-power racist preaching career with the cry “God damn America.” The media furor that followed has since waned, but in the midst of Obama’s scrambling for damage control his admiring church leaders did not flinch. Forbes himself defended, “Some of us wish we had the nerve that Jeremiah had. . . . We praise God that he’s saying it, so the rest of us don’t have to.”5 To nearly everyone who is not defending a radical agenda, Wright crossed a line so far as to warrant some kind of church and perhaps even civil discipline, but again the leftist church leaders spin: “I think if a person is a prophet and he’s not seen as ever crossing a line, then he has not told the truth as it ought to be told.”6 In this precarious logic, does the end justify the means? If a man is a prophet then a line must be crossed somewhere. Granted, Biblical prophets often did buck popular trends, but this does not mean that everyone who causes public unrest represents the voice of God. If Forbes’ line-crossing logic applies to Jeremiah Wright, then Osama bin Laden is the greatest prophet of our time. So here is exactly the deceit of the social Gospel: the end is always to advance the liberal political and social agenda no matter what package it comes in. In whatever ways Scripture, tradition, and reason must be mangled and wrested to fit this agenda, the liberal leaders, theologians, seminaries and preachers stand ready with whatever color wrapping paper and bow the season calls for. For them, it is not God’s Word that matters, but the leftist agenda. To them, however, God’s Word is useful for giving the appearance of God’s approval for the leftist agenda. The Hope of Evangelical Audacity It is old news, however, that leftist politics is the core message of the liberal churches. A somewhat more recent and more frightful development was the wedding by some evangelicals of liberal politics with Biblical language. Beginning in 1977 with the publication of Ron Sider’s Rich Christians in an Age of Hunger, the liberal politics of guilt-manipulation began sweeping through evangelical churches, seminaries and especially colleges. While Sider’s rhetoric, originally verging on marxism, has changed considerably over the years (after reams of criticism), his core belief that government must redistribute wealth and provide welfare remains central to his continued publications.7 Worse yet, he has several popular and quasi-evangelical clones including Bill Clinton’s former spiritual counselor Tony Campolo, and the editor of the liberal magazine Sojourners, Jim Wallis. The subtitle of Wallis’ New York Times Bestseller God’s Politics,8 provides some insight into Wallis’ agenda: Why the Right Gets It Wrong and the Left Doesn’t Get It. Do you catch the subtle innuendo? Reading the book will make it clear. While Wallis makes the point of saying that God is neither a Republican nor a Democrat—appealing language to the non-denominationally minded—his conclusions always end up sounding decidedly leftist, especially on economic issues. Wallis’ prejudice is clear: the Right is wrong when it speaks of religion, but Leftists (so far) have only been asleep to the possibility of leveraging religion. In other words, the Left needs only to wake up to the opportunity of hijacking religious language for the furthering of its goals. Wallis is not at all shy in fusing his leftist politics with religion: “Democrats must get religion on the budget,” he writes.9 This is Obama’s agenda, too. He says, “[I]f we don’t reach out to evangelical Christians and other religious Americans and tell them what we stand for, then the Jerry Falwells and Pat Robertsons and Alan Keyeses will continue to hold sway.”10 It is clear that there exists a growing trend of liberal activism in the guise of evangelical language. Obama is afraid that the left will “forfeit the imagery and terminology through which millions of Americans understand both their personal morality and social justice.”11 He doesn’t want religious language to speak for itself; it needs a liberal “progressive” interpreter. Wallis is on the job, and your church is his target. Once again, this is the deceit of the social Gospel, only it is the Social Gospel II, or the New Social Gospel. It is being repackaged as an evangelical hope, and it is just as audacious as its predecessor. . . . The “Common Good” Wallis and his leftist idols including Obama continually talk about the “common good.” Closely related to the hijacking of religious terminology, “the common good” is a way of looking religious and deceiving religious people into signing up, yet denying the Bible itself any mention that is not already censored and sanctioned by the socialist agenda. So when Wallis seems to speak boldly for the faith when he refers to “prophetic politics,” he immediately smothers the idea under a leftist pillow: “We must find a new moral and political language that transcends old divisions and seeks the common good. . . . Prophetic politics would not be an endless argument between personal and social responsibility, but a weaving of the two together in search of the common good.”12 Question: how does individualism survive any “weaving together” with mandated social programs? Exactly. To the extent that government grows individual liberty shrinks. This is the clever trick of “common good.” Who can argue against the “common good”? Are you saying you prefer the “common evil” or the “uncommon good”? That’s unchristian! Then whenever a program is put forth as “for the common good,” you must either vote for it or declare yourself public enemy number one. Wallis defines it in softer language: “new civic partnerships in which everyone does their share and everybody does what they do best.”13 The attentive student will hear Karl Marx ringing in the background, “From each according to his ability, to each according to his needs!” Yes, it was the great father of modern communism’s visionary banner unfurled over a society where “In a higher phase of communism society . . . all the springs of co-operative wealth flow more abundantly.”14 That Wallis is pushing the left’s agenda and code language is again obvious. Obama says, “Politics depends on our ability to persuade each other of common aims based on a common reality.”15 This really means evangelicals must leave the foundation of their religion outside the doors of city hall, and Obama is honest about this: “Now this is going to be difficult for some who believe in the inerrancy of the Bible, as many evangelicals do. But in a pluralistic democracy, we have no choice.” That is the leftists’ answer: “We have no choice.” The vaunted side of pro-choice is anti-choice when it comes to Biblical faith being explicit. They want the name “Biblical faith,” and they want the voting appeal of “Biblical faith,” but when it comes to actual policy-making the Bible must be removed from the table. It must be replaced by “the common good.” What you will never hear them ask let alone affirm is this: “Are less spending, lower taxes, and minimal government involvement in the common good?” This question is never asked because it is antithetical to the left’s platform which Wallis pushes. One reviewer notes, “I have never read an issue of Sojourners without finding at least one (and usually many more than one) demand to increase the power and scope of the state.” The author continues in an open letter to Wallis, “[T]here is no one in the world of organized Christianity who has championed Leviathan more than you. I have come to believe that you oppose U.S. conflicts not so much because they are immoral, but rather because they take resources away from the government’s being able to wage war on productive people at home.”16 In fact, Wallis (ironically and ignorantly) even calls cuts in the size of government “draconian.”17 (“Draconian” comes from “Draco” who was the first legislator of Athens. His laws were famous for prescribing harsh penalties, often death, for minor offenses. “Draconian” refers to too much government, not reductions in government power.) What about explicit Biblical commands, are those for the common good? How about, “You shall not steal”? That’s obvious; but could we say, “You shall not steal through legislation”? Is that stretching it, or does that fall under “enacting evil statutes” (Is. 10:1)? Wallis cannot remain Biblical and continue to argue for unequal tax burdens and government confiscation of wealth. The Bible demands no theft, which means no financial favoritism of any kind (it fully means no income tax or social security tax at all, but that’s for a different report). What? Is the Bible against the poor as Wallis blames conservative Christians? Solomon doesn’t think so. Even when a poor man steals out of hunger, though men might be tempted to sympathize, God, Solomon says, yet considers that a punishable crime: “Men do not despise a thief if he steals to satisfy himself when he is hungry; But when he is found, he must repay sevenfold; He must give all the substance of his house” (Prov. 6:30–31). This is because laws should not be written to favor either the rich or the poor. This is why Wallis and his colleagues always talk about “common good” and undefined “biblical principles.” This has been the strategy since Ron Sider first began dousing evangelicals with guilt in 1977. Even though affirming God as sovereign over every area of life, we are continually told that the Bible provides no “blueprints” for society. Sider wrote, “We do not find a comprehensive blueprint for a new economic order in Scripture . . .”18 Wallis echoes, “The Bible doesn’t propose any blueprint for an economic system. . . .”19 The matchless critic David Chilton had the proper response: This, of course, means that Sider is free to devise his own blue-print, while using vague “biblical principles” to justify his thesis to the Christian community. Sider’s blueprint calls for socialistic redistribution of wealth and government intervention—a blueprint not countenanced in Scripture, but which Sider claims to find in the fact that “biblical revelation tells us that God and his faithful people are always at work liberating the oppressed, and also provides some principles for apropos justice in society.”20 Wallis concurs: the Bible has no blueprint, “but rather insists that all human economic arrangements be subject to the demands of God’s justice, that great gaps be avoided or rectified, and that the poor are not left behind.”21 Neither Sider nor Wallis say where the Bible allows government to extract private money for these causes (it doesn’t), nor do they even compare their “biblical principles” to the blueprint provided in Old Testament law (yes there is a blueprint there). Sider has since replaced his appeal to “Biblical principles” with the more sophisticated sounding “holistic Biblical vision” and “normative framework,” and yet continues his slogan, “[T]he bible does not offer a detailed blueprint for political life today.”22 Nevertheless, we are left with Chilton’s conclusion (a good one) that these men are merely using the Bible to advance leftist social agendas. There is no other explanation. This transparency does not stop these men from fighting for their cause. Anyone who opposes their view and cites particular Scripture verses as “normative” or proposes a different “framework” they simply label as “theocracy”23 or “theocrats.”24 Wallis warns that these theocrats are found among “the Religious Right’s leaders” and they “would impose their versions of morality on the nation if they ever had the chance.”25 The laugher holds great irony. It is the Biblical view which seeks to minimize the size of government intervention in our lives and hopes to maximize prosperity through honesty and freedom. Meanwhile, Wallis wants to “impose” a government that extracts vast quantities of private wealth and manage a behemoth network of welfare agencies. “Theocracy” by any Biblical definition makes Wallis’ leviathan look like a Soviet Corrective Labor Camp. Meanwhile, the preachers at the church Obama spends so much time in have a little different view of whose ground is common. The liberal Catholic priest, Michael Pfleger, who has at times filled the pulpit in Jeremiah White’s absence, has a strong racist beef. To whites who say, “Don’t hold me responsible for what my ancestors did,” he prescribes this: But you have enjoyed the benefits of what you ancestors did! And unless you are ready to give up the benefits—throw away your 401 fund, throw away your trust fund, throw away all the money they put away and company you walked into . . . unless you’re willing to give up the benefits, then you must be responsible for what was done in your generation. . . !26 What Pfleger proposes fits very squarely into Wallis’ “Biblical principles.” Turn over rich white money and give it to poor black folk. This would certainly eliminate a gap and alleviate some poverty for a while. Is this a just proposal? How can we judge if it presents “common ground” or not? If the Bible provides no blueprint, then who does? And why should we respect their blueprint? If Pfleger is sitting across that table from you, you’d better hope that Biblical law arbitrates that discussion, else the compromise might get painful to listen to. So when these new social gospellers say “common ground” they really mean that they want your ground to be held in common. You give ground and they’ll tell you how you can use it. You write the check and they’ll spend it. “Common ground” is a liberal’s dreamscape where Biblical monuments are leveled (Deut. 19:14, 27:17) and wealth flows into the coffers of the State where liberals can spend it (minus 20% for administrative fees). When you hear common ground think of a drawbridge inviting an invading army into your castle. Wallis wants to cross the moat of Biblical boundaries. He calls, he promises, he cries, “Peace, peace.” The bridge is yours to lower. Or not. Eric Rauch is the Director of Communications for American Vision. Are you interested in leaving a comment on the American Vision blog related to this article? Click here to type in your comment directly into the blog.

1 http://blog.beliefnet.com/lynnvsekulow/2008/08/saddleback-biased-questions-an.html, accessed August 18, 2008. 2 http://www.nytimes.com/2008/08/04/nyregion/04riverside.html?_r=2&scp&oref=slogin, accessed August 19, 2008. 3 http://www.youtube.com/watch?v=Jj2tnZEtJO4, accessed August 19, 2008. 4 http://www.youtube.com/watch?v=K4_La_nL1oQ, accessed August 19, 2008. 5 http://newsweek.washingtonpost.com/onfaith/lisa_miller/2008/03/obamas_church_of_contradiction.html, accessed August 19, 2008. 6 http://newsweek.washingtonpost.com/onfaith/lisa_miller/2008/03/obamas_church_of_contradiction.html, accessed August 19, 2008. 7 Just Generosity: A New Vision for Overcoming Poverty in American, 2nd Ed. (Grand rapids, MI: Baker Books, 2007 [1999]); The Scandal of Evangelical Politics: Why Are Christians Missing the Chance to Really Change the World? (Grand Rapids, MI: Baker Books, 2008). 8 (San Francisco, CA: HarperSanFrancisco, 2005) 9 http://www.sojo.net/index.cfm?action=sojomail.display&issue=060308, accessed August 19, 2008. 10 Barack Obama, keynote address at Call to Renewal’s “Pentecost 2006: Building a Covenant for a New America,” June 28, 2006; available at http://obama.senate.gov/speech/060628-call_to_renewal/, accessed August 20, 2008. 11 Barack Obama, keynote address at Call to Renewal’s “Pentecost 2006: Building a Covenant for a New America,” June 28, 2006; available at http://obama.senate.gov/speech/060628-call_to_renewal/, accessed August 20, 2008. 12 Wallis, God’s Politics, 75–76. 13 Wallis, God’s Politics, 76. 14 Karl Marx, “Critique of the Gotha program,” Basic Writings on Politics and Philosophy: Karl Marx and Friedrich Engels, ed. Lewis S. Feuer (Garden City, NY: Anchor Books, 1959), 119. 15 Barack Obama, keynote address at Call to Renewal’s “Pentecost 2006: Building a Covenant for a New America,” June 28, 2006; available at http://obama.senate.gov/speech/060628-call_to_renewal/, accessed August 20, 2008. 16 William Anderson, “An Open Letter to Jim Wallis and the Sojourners Movement,” LewRockwell.com, November 17, 2004; available at http://www.lewrockwell.com/anderson/anderson107.html, accessed August 20, 2008. 17 Wallis, God’s Politics, 242. 18 Quoted in David Chilton, Productive Christians in an Age of Guilt Manipulators: A Biblical Response to Ronald J. Sider, 3rd Ed. (Tyler, TX: Institute for Christian Economics, 1985), 19. 19 Wallis, God’s Politics, 273. 20 Chilton, Productive Christians in an Age of Guilt Manipulators, 20. 21 Wallis, God’s Politics, 273. 22 Ron Sider, The Scandal of Evangelical Politics, 42. 23 Jim Wallis, “Dobson and Obama: Who’s deliberately Distorting?” The Huffington Post, June 25, 2008; available at http://www.huffingtonpost.com/jim-wallis/dobson-and-obama-who-is-d_b_109193.html, accessed August 20, 2008. 24 Wallis, God’s Politics, 82. 25 Wallis, God’s Politics, 82. 26 Quoted in Freddoso, The Case Against Barack Obama, 162.

Street thugs and Obama’s Nomination

 

 

 

By Rev. Dr. Tommy Davis

 

When street thugs rob at gunpoint or even kill just to pilfer possessions from another person it is another example of misguided hoodlums who feel that they cannot compete legally in our economy. They believe that they must deprive others of their material goods in order to gain an economic advantage. Armed robbers must continue to commit crimes because their income will only resume through swindle. Lacking the intellectual capital and patience to participate in the free market, they cheat and steal from those who possess wealth.

Time after time the media reports this kind of action and it is justified by shifting the blame to a legacy of slavery and racism.

Obama’s speech about taxing the rich and redistributing their wealth is no different than a robbery that hasn’t yet turned bad. When liberal socialists go after companies who make an honest living and attempt to redistribute their wealth (communism) they are stealing.

Businesses manufacture a product that consumers purchase. Therefore, a fair exchange takes place. When those consumers turn around and accuse business owners of making too much money, this is nothing short of envy; and when such folks elect government officials who will penalize companies for being successful by taxing them severely, this is nothing short of criminal —- professional stick-ups.

It doesn’t matter if Obama’s becomes president. The community (especially the black community) will still suffer because the problems are self inflicted. Those black folks who vote for Obama just because he’s black are racists. He will not “change” the 50 percent school drop-out rate among African-Americans, or the 70 percent illegitimacy rate regarding two parent households in black communities; and he will not transform the high murder rate (over 50 percent) committed by black males in this country.

The same candidates who says that they will create jobs are promoting the very policies that cause businesses to lay off and slow production. Government do not create jobs. Citizens generate employment through innovation by starting businesses constructing products that benefit society.

Time will tell how many government robberies will bring about fatal wounds to American business.

 

Send Dr. Davis an email

On the Trail of the Bush-McCain Monster

“Ashbrook Centre”
Editorial
August 2008

by: Andrew E. Busch

News reports published in the last week have stated that the Obama campaign will make a primary theme of the Democratic National Convention the argument that a victory for John McCain will merely represent an extension of the unpopular George W. Bush presidency.

On one hand, this possibility accentuates the drag that Bush represents on the Republican ticket. Media commentators have focused their attention on the question of why McCain is so close to Obama in the polls despite all of the generic signs of a bad Republican year; another way to look at the same question is to ask where Obama, with thinner credentials than any major party nominee since Wendell Willkie, would be if Bush’s approval rating was 55 percent instead of 35 percent. The probable answer tells us how central Bush’s difficulties are to Obama’s hopes.

On the other hand, a decision to turn the Democratic convention into an unrelenting hunt for the Bush-McCain monster may prove to be a poor use of the convention.

For one thing, Obama has been trying with great regularity for the last several months to make the Bush-McCain connection stick, but with only limited success. Politically aware Americans know that McCain and Bush have been at odds on a number of important issues since their titanic nomination battle in 2000. McCain is not Bush’s vice president, and it will be much harder to pin real and perceived presidential shortcomings on him the way that Richard Nixon pinned them on Hubert Humphrey, Ronald Reagan on Walter Mondale, or George W. Bush on Al Gore.

McCain himself has a number of good defenses against the charge, which he will undoubtedly deploy (though perhaps delicately) throughout his own convention. And because the Republican convention follows hard on the heels of the Democratic convention, McCain will get the last word on the subject, perhaps before the Democratic argument has even had a chance to sink in. Obama will have given his best shot, but in the end it is very possible that not much will have changed in the race.

The danger is that the opportunity cost for Obama if he takes this course could be high. Though McCain has run a much improved campaign in recent weeks and showed himself to be a formidable opponent at the Saddleback Civic Forum, Obama’s biggest obstacle isn’t McCain, it is himself. His thin record of accomplishment and short time in public life mean that he must use his convention, above all, to help American voters reach a level of comfort that they have not yet attained with him as a person and as a political figure.

Obama remains, in the minds of many Americans, a big question mark. His policy pronouncements are vague, his associations are questionable, his record in the U.S. Senate and the Illinois legislature is minimal, his enthusiastic embrace by foreign crowds not normally disposed to wish the United States well is troubling. His frequent shifting around since early June has only served to raise more questions.

The Democratic convention may be Obama’s last big chance to try to answer those questions on his own terms. On some counts, the task may be beyond him (how does one explain away Bill Ayers?), but on others, the convention offers him a venue well-designed for the exposition of biography and policy.

Using it instead primarily as a bludgeon to establish a largely spurious connection between Bush and McCain could work, but just as likely will not. There are many more holes in the public’s knowledge of Obama’s story than in its knowledge of McCain’s. If Obama doesn’t use his convention effectively to fill them in first, the Republican convention a week later surely will. Then the Bush-McCain monster will sink out of sight, replaced by the ubiquitous McGovern-Obama creature, which may prove more enduring because it is more plausible.

Andrew E. Busch is a Professor of Government at Claremont McKenna College and an Adjunct Fellow of the Ashbrook Center.

What About Theocracy?

by Dr. Richard A. Jones The August 16, 2008, Obama-McCain “Forum on the Presidency” at Rick Warren’s Saddleback Church unexpectedly released two major political genies. First, the responses to Warren’s questions about a “Christian” worldview and the two candidates’ views on marriage and abortion led to shocks which, overnight, made Obama significantly less attractive while McCain gained ground. And, whether deserved or not, the nation’s reaction seemed to grant McCain more of a “Christian” mantle than he might have anticipated. The traditional-values voting bloc which, until that evening, looked as if it would be staying home this November suddenly became revitalized.   The second consequence came with the release of the first of what’s likely to be a host of outbursts by disingenuous “theocracy threat” sentinels from left-leaning media and allied groups. This cabal of usual suspects is forever feigning concern about an underground, ever-lurking “Kristian Klan.” Their endless promoting of this myth makes it all but certain they’ll soon be re-alerting the gullible in both secular and religious camps that a President McCain is likely to be the new, intolerant “Attila, the values czar.” Especially if he’s endorsed by James Dobson; a development that looks increasingly possible.    By and large, these sham Paul Reveres with their shrill, “the theocrats are coming,” are less-than-honest agitators whose purpose quite frankly appears to be establishment of nationwide socialism. The menace that these theocracy-threat impostors say they must protect us from is exactly what they privately, would impose (socialist tyranny) on all citizens with Christians first in line to be minimized. Using strawman tactics, they pretend (particularly at election time) that the hated Religious Right is ever poised to “Take over the country and enforce a Church-run theocratic dictatorship; a modern Inquisition. This radical, Falwell-Dobson-Kennedy-inspired Christian Taliban,” they declare, “would scrap First Amendment protections and persecute enlightened humanists and atheists…those tireless visionaries ever striving to achieve a ‘secular, pluralistic, diverse, multicultural, mega-tolerant, globalist country just as our founders intended from the beginning,’ etc.” You get the picture. Here’s why the strident church-run government story is actually a breathtaking lie. One-world socialism is the real goal, and if it’s to succeed the cabal knows that God must be severely scorned, weakened if not outright killed off. Using non-stop media blasts and public school programming of youth, the plan is to relegate potentially activist Christians damaged by humanism to the culture-engagement sidelines. Young Christians during this conditioning process are also set up to accept “theocracy” scare tactics as they relate to the sacred secular concepts of mindless tolerance, love and acceptance. In an age of “tolerance above all,” to admit that your values are biblical is not cool. Thus, any who would dare to stand up for pure biblical values are automatically placed into the false “theocrat” category, and compromised youth are fast learning not to go there.    A second fact dramatizing the cynical falsity of fake “theocracy” warnings is that there is no Army of the Religious Right ready to march to crush the humanistic heirs of Plato, Descartes, Locke, Robespierre, Paine, Emerson, Marx, Darwin, Dewey, et al. In every respect the United States Church is as close to being dead in the water as Screwtape and Satan could have ever wished. (Not that a truly Christian Church has ever been or ever would be desirous of forcing “church rule” on anyone.)  No, the chief wish of today’s church leaders and congregants is to be left alone, quietly blending in while enjoying their careers and material acquisitions and waiting for Jesus to return to take care of the bad guys. “Sure, the government must stick up for Israel,” but beyond that, politics for most is a dirty business. It’s “of the world and the devil” making it a snare that Christians are better off avoiding. In truth, with each passing year of Christian political and general do-nothingism in an imploding culture, the socialist impulse grows ever stronger “without anyone even knowing how it happened,” just as Norman Thomas predicted.  So, how did all this furor get started anyway, and what exactly is a theocracy? A full answer extends to next time, but for now please consider such words as democracy (Greek: demos=the people + kratos=rule), plutocracy (rule by the rich), autocracy (by a despot) or bureaucracy (by bureaucrats). “Theocracy,” coined by Josephus, then simply means rule by God, not by priests or ministers. That’s why the kind of imaginary government that sham “freedom preservers” pretend to fear would technically have to be called an “ecclesiocracy” or rule by a group of “called-out” men (from the Greek) from within a church, mosque, or synagogue. But since the Trinitarian God is the true target of the socialism-obsessed, they’ve shrewdly created a bogus accusation (theocracy) against Christian men which is impossible just by straight definition. But, humanly speaking, once the true God is mocked and sneered out of existence as is hoped, then installing socialism becomes infinitely easier. Socialism is theocratic, given the modern definition, since it makes the State to be God. Dr. Richard A. Jones – contact: dickjones1517@sbcglobal.net. Are you interested in leaving a comment on the American Vision blog related to this article? Click here to type in your comment directly into the blog.

Pelosi in Denver: Sing It Nancy, Sing It

By Jessica Peck Corry 08/26/2008

DENVER–

 

On the heels of a Saturday interview where she proclaimed that she is not a “Washington insider,” House Speaker Nancy Pelosi took to the Democratic National Convention’s main stage Monday to preach change. After delivering a lengthy series of platitudes, however, the only change most viewers were thinking about was changing the channel.

“America stands at a crossroads, with an historic choice between two paths,” proclaimed Pelosi. “One is a path of renewing opportunity and promoting innovation here at home, and of greater security and respect around the world…but there is another path — it leads us to the same broken promises and failed policies that have diminished the American dream and weakened the security of our nation.”

While Pelosi’s remarks were clearly designed to establish a viable contrast between GOP presumed presidential nominee John McCain and Democratic selection Barack Obama, it wasn’t always clear which path she was advocating.

After all, with 11 terms in Congress under her belt, and with the last two years spent as the House’s highest ranking official, Pelosi found herself railing against the Washington machine that we’re supposed to identify not with her, but with McCain.

“We call this convention to order tonight to put America on the path begun by our founders — a path that renews America’s promise for a new century,” she said.

But with Pelosi at the helm, we’ve seen government spending continue to escalate, the war in Iraq persist, and gas hitting $4 a gallon. She can only blame so much of this turmoil on President George W. Bush. Congressional Democrats — now in leadership — also remain culpable.

Pelosi’s attempt to highlight the successes of her party also fell flat. In her remarks, Pelosi claimed to be “very proud of the Democrats in Congress.” But proud of what, exactly? Since breaking through what she calls “the marble ceiling” in January 2007 to take over as Speaker, Pelosi has very little to show for her own efforts.

“After years of inaction by Republicans, in our very first act, we passed the 9/11 Commission recommendations to protect the American people. That was just the beginning.”

How many Americans even know what the 9/11 Commission actually recommended? Take a quick survey around your office and you’ll quickly get your answer. Not many.

While Pelosi started with national security, she quickly moved on to recording how Democrats in leadership have promoted the socialist policies of yesterday, including raising the minimum wage, expanding college aid, and passing “legislation to keep hard-working American families in their homes.”

Other highlights, as selected by Pelosi: “We helped rebuild the Gulf Coast for the survivors of Hurricanes Katrina and Rita. We put recovery rebates into the hands of more than 130 million families.”

There was not a single reference to the Democrats’ comprehensive economic plan — presumably because it doesn’t exist. She says “America needs a president who knows our democracy depends on a strong middle class, and who will create millions of good-paying jobs right here at home.” But Pelosi’s decades in Washington have led her to believe the incredibly powerful lie that it’s government — not people — creates sustainable and lasting jobs.

Pelosi closed her remarks by claiming “Democrats know we can’t afford any more of the same failed Republican path.” But Pelosi, like all Democrats seeking to win over former Bush supporters, faces an incredibly difficult predicament. She must successfully call for change in Washington without indicting her own party’s lack of success.

When Pelosi was asked at a Saturday briefing sponsored by the Christian Science Monitor whether she classified herself as a “Washington insider,” the Hill newspaper reports that she responded with, “Oh, absolutely not. No.”

According to Pelosi, it’s all about “state of mind” and not length in years. “Inside, outside — you have to know the territory so you can work it, but you never become a part of it,” she said. But Pelosi is part of it — in fact, she’s running the show. And at the DNC microphone, she becomes a Republican fantasy.

If now is the time for change, Nancy’s got to go too.

Jessica Peck Corry (Jessica@i2i.org) is a policy analyst with the Independence Institute in Golden, Colo., where she specializes in land use, higher education, and civil rights policy.”

 

 

The Magog Invasion

by Gary DeMar I predicted it! When Russia invaded Georgia, a former satellite state of the former Soviet Union, I knew there would be prophecy writers who would claim that it’s all part of God’s end-time plan. Contemporary prophecy writers, following a long tradition of interpreting the Bible through the lens of current events, use Bible passages that can be easily shaped to fit any geo-political change. Why they didn’t see these changes long ago is a mystery to me since they keep telling us that they believe in a literal interpretation of the Bible. For example, Hal Lindsey believes the prophecy Ezekiel was given by God 2500 years ago predicted today’s political events based on a literal interpretation of Ezekiel 38 and 39. “‘Gog’ refers to modern Russia,” Lindsey argues, “from Moscow (Meshech) to Siberia (Tubal). ‘Magog’ refers to the states along the Black Sea, and in particular, the Republic of Georgia.”1 He is following a script codified in the notes of the 1917 Scofield Reference Bible where we read the following: “That the primary reference is to the northern (European) powers, headed up by Russia, all agree” (Ezek. 38:2). Of course, not all have agreed or do agree. The 1969 revised New Scofield Reference Bible reconfirms that “the reference to the power of the north of Europe” will be “headed by Russia.” The only divergence from Scofield’s original position is that Europe is now out of the prophetic picture and the Islamic nations are in. Here’s a question: Why didn’t Scofield see the Islamic nations in Ezekiel 38 and 39 like Lindsey, Ron Rhodes, Mark Hithcock, Thomas Ice, and every other prophecy writer now does? What Lindsey writes next is very important: “Two thousand, five hundred years ago, a Hebrew captive living in Babylon outlined in detail the scenario that has continued to unfold and take shape in precise detail for most of the past generation.” I want you to notice the phrase “in precise detail.” I challenge anyone who says he interprets Ezekiel 38 and 39 literally, as most prophecy writers say they do, to read these two chapters and find any mention of Russia,2 Moscow, Siberia or the Republic of Georgia. Read the chapters through a second time and see if you can find tanks, “missile receptor batteries,” nuclear weapons, and jet planes. So then, do these prophecy “experts” really interpret the Bible literally? When it comes to Ezekiel 38 and 39, the simple answer is no. There’s an old proverb that goes something like this: “The proof of the pudding is in the eating,”3 which means, you don’t know if the pudding is good to eat until you actually eat some of it. This works out to mean don’t assume that something is true until you put the claim to the test (see Acts 17:11 and 1 John 4:1). The proof that someone is actually interpreting the Bible literally is to see how he actually interprets a passage. Keep in mind that even those who say they always interpret the Bible literally admit that they often don’t. Lindsey himself admits, “Premillennialists interpret literally and allegorically. The issue is to let the text dictate when to interpret allegorically instead of our theological presuppositions.”4 Some people might object to a literal reading of Ezekiel 38 and 39 by claiming that Ezekiel used language that would have been understood by his first readers. They wouldn’t have understood what God was saying, it is claimed, if He had described missiles and nuclear weapons to Ezekiel. If this interpretation is followed, then this would not be interpreting the Bible literally. And yet, this is exactly the approach used by popular prophecy writers who claim that Ezekiel 38 and 39 is a 2500 year-old prophecy about Russia and the Islamic nations based on a literal interpretation. Ron Rhodes claims to interpret Ezekiel 38 and 39 literally. “Here is a basic rule of thumb for interpreting the Bible: When the plain sense of Scripture makes good sense, seek no other sense.”5 Rhodes, in a book he co-authors with Norman Geisler, expands on the “plain sense” interpretive approach. They say that literal “refers to the understanding of a text that any person of normal intelligence would understand without the help of any special keys or codes.” The literal meaning of Scripture “embraces the normal, everyday, common understanding of the terms of the Bible. Words are given the meaning they normally have in common communication.” The interpreter should be mindful of the “historical setting.” Sentences of Scripture “should not be taken out of the space-time, cultural context in which they were uttered.” This next point is important: “It is the means by which the interpreter mentally transfers himself into the context in which the author uttered the words. This guards against the interpretive error of making the reader’s historical or cultural context the norm for understanding the text.”6 Keep these definitions in mind if you ever decide to read a popular exposition of Ezekiel 38–39 that mentions nuclear weapons, jet planes, and mechanized war implements. Tim LaHaye insists that the interpreter is to “take every word at its primary, literal meaning unless the facts of the immediate context clearly indicate otherwise.” We learn from LaHaye that the prophecies found in Ezekiel 38 and 39 “are among the most specific and easy to understand in the prophetic word.”7 If this is true, then why do LaHaye and those who follow his interpretive methodology force a less than literal interpretation on Ezekiel’s two-chapter prophecy?  If they say they are interpreting the Bible literally, then how do they explain horses, bows and arrows, shields, swords, and chariots? Why would Ezekiel do this if the prophecy was meant to be understood by people 2500 years in the future? Remember what Lindsey wrote: “Two thousand, five hundred years ago, a Hebrew captive living in Babylon outlined in detail the scenario that has continued to unfold and take shape in precise detail for most of the past generation.” Ezekiel’s details are hardly precise for our day and age, but they were precise for Ezekiel’s day and age. Lindsey, LaHaye, and Rhodes aren’t alone in perpetuating this interpretive dodge by following what Greg L. Bahnsen described as “newspaper exegesis,”8 a form of retroactive prophetic evaluation where current events are read back into the Bible. For example, in The Coming Islamic Invasion of Israel, Mark Hitchcock exemplifies a “newspaper exegesis” methodology when he claims that “Ezekiel is God’s war correspondent for today’s newspapers. We have gone through his inspired prophecy in Ezekiel 38–39 with our Bibles in one hand and today’s newspaper in the other.”9 I’ll ask the same question of Mr. Hitchcock: Where are the jet planes and nuclear weapons? Where does this leave us? If Ezekiel is not describing a war fought 2500 years removed from his own day, then what’s it all about. It’s obvious that Ezekiel is describing an ancient battle fought with ancient weapons against an ancient foe. The prophecy has been fulfilled. The only event in history that can be its fulfillment is the events of Esther where God’s people are rescued from Haman who “sought to destroy all the Jews, the people of Mordecai, who were throughout the whole kingdom of Ahasuerus . . . to destroy, to kill, and to annihilate all the Jews, both young and old, women and children, in one day, the thirteenth day of the twelfth month, which is the month Adar, and to seize their possessions as plunder” (Esther 3:6, 13; cp. Ps. 83:4) and failed (9:1).10 Gary DeMar is the President of American Vision. Are you interested in leaving a comment on the American Vision blog related to this article? Click here to type in your comment directly into the blog.

1 Hal Lindsey, “Oh, My Gog!” (August 22, 2008): http://www.worldnetdaily.com/index.php?pageId=73063 2 I am well aware of how the Hebrew word rosh in Ezekiel 38:2–3 and 39:1, best translated as “chief,”  is made to mean modern-day Russia. I deal with this claim in my forthcoming book The Magog Invasion: Why Modern-Day Prophecy Writers are Wrong and Dangerous. 3 The proverb has been corrupted and is often stated as “The proof is in the pudding.” 4 Hal Lindsey, The Road to Holocaust (New York: Bantam Books, 1989), 65. Emphasis in original. Just for fun, the address for Bantam books is 666 Fifth Avenue, New York, New York. 5 Ron Rhodes, Northern Storm Rising: Russia, Iran, and the Emerging End-Times Military Coalition against Israel (Eugene, OR: Harvest House, 2008), 20. 6 Norman Geisler and Ron Rhodes, Conviction without Compromise: Standing Strong in the Core Beliefs of the Christian Faith (Eugene, OR: Harvest House, 2008), 196. 7 Tim LaHaye and Jerry Jenkins, Are We Living in the End Times?: Current Events Foretold in Scripture . . . And What They Mean (Wheaton, IL: Tyndale House Publishers, 1999), 84. 8 Greg L. Bahnsen, “The Prima Facie Acceptability of Postmillennialism,” Journal of Christian Reconstruction: Symposium on the Millennium, ed. Gary North (Winter 1976–1977), 53–54. This article can also be found in Greg L. Bahnsen, Victory in Jesus: The Bright Hope of Postmillennialism (Texarkana, AR: Covenant Media Press, 1999). 9 Mark Hitchcock, The Coming Islamic Invasion of Israel (Sisters, OR: Multnomah Publishers, 2002), 93. 10 I make a case for this interpretation in my forthcoming book The Magog Invasion: Why Modern-Day Prophecy Writers are Wrong and Dangerous.

The Most Fearful Speech I Have Ever Read

 

By Dr. Gary North 
for Gary North’s Q&A forums: www.GaryNorth.com

I have just read the most fearful speech I have ever read that was delivered by a high-level American official who is in a position to know what he is talking about. No other speech comes close. I have been reading speeches for a living for over 40 years.

I am going to do what I have never done before in a newsletter. I will offer no summary and no comments. I will supply a link. Click this link. Print out the speech. Read it.

It will scare you. It scares me. Things are worse than I had imagined, and my scenario has been bad. This dwarfs my scenario. Coming from the person who delivered it, you had better take it seriously.

I have no further comments. Click. Print. Read.

http://www.GaryNorth.com/snip/625.htm

The Looming Federal Default: Sooner or Later?

 

By Dr. Gary North 
for Gary North’s Q&A forums: www.GaryNorth.com

The overwhelming majority of Americans are relying exclusively on Social Security and Medicare to provide a comfortable retirement in their old age.

When interviewed, they say they think the systems are going to go bust, but they do not change their behavior and save more.

They save less. Today, household saving as a percentage of household discretionary income is negative. Americans are borrowing to maintain their lifestyles.

Most Americans now live 15 years or more after their Medicare payments begin and 14 years after their Social Security payments begin. As longevity increases, and as Medicare payments keep people alive in the final six months of their lives, which are the most expensive phase of their lives, medically speaking, these two systems will go into red ink status. The generally accepted estimate for this is 2017 for Medicare. Social Security may take a decade longer.

The United States government is now something in the range of $75 trillion in the red for these two programs. Most of this is Medicare. I report on these figures in a free department on my Website, www.GaryNorth.com. You can verify there what I am saying here.

This means that over the life of the two programs, the Federal government will have to find $75 trillion to make the payments that it has committed to make to all Americans in their retirement years. This assumes, of course, that this liability does not increase as a result of even greater life expectancy.

Whether or not Americans live longer, this gigantic figure is guaranteed to increase. Why is this? Because the programs are not being funded today. For every year that the expected liabilities are not being covered by money set aside that will produce a guaranteed return (guaranteed by whom?), the principal that is not paid is tacked onto the total debt owed. If, this year, as is certain, $2 trillion are not set aside in income- producing assets, this $2 trillion will be tacked onto the $75 trillion obligation.

None of the investments are funded by investments in income- producing assets. The trust funds of both organizations are exclusively invested in nonmarketable, long-term United States government debt. There are only three ways to pay off his debt.

First, the government can increase workers’ taxes. Second, the government can reduce the payments. Third, the government can borrow from the capital markets. Fourth, the government can borrow from the Federal Reserve System which will create the money out of nothing to purchase additional debt.

Because the government already refuses to lay aside sufficient tax money to pay off these debts, we know what the government will do. It will either cut back on payments, or it will borrow additional money, either from the private capital markets for from the Federal Reserve System.

A WAY TO UNDERSTAND WHAT IS HAPPENING

The government borrowing money today with a promise to pay off the loan later. This “later” can best be understood by watching Judy Garland sing “Someday, over the rainbow (way up high).”

For movie buffs, the best still image in W. C. Fields, with his top hat, dealing cards in “My Little Chickadee.” His motto: “Never give a sucker an even break.”

For moving images, any scene by Groucho Marx will work fine.
But I recommend the scene in “The Coconuts,” where he is selling Florida real estate. Chico asks what the houses are made of.

Groucho answers, “You can get them in wood. You can get them in stucco. Boy, can you get stucco!”

Economically, speaking, our best example of what we are facing is to think of ourselves as bankers who have lent trillions of dollars to borrowers. The borrowers are officially retirees, but legally speaking, there is one borrower: the U.S. government.

Think of Social Security and Medicare as long-term
mortgages. The big question is this: Which type of mortgages?

We have all heard of subprime mortgages. Very few people had ever heard of them a year ago, when the international capital markets began to break down as a result of these mortgages. The banking industry trusted them. The financial industry sold tens of billions of dollars of these toxic waste investments to their investors. No one knows how to recover the losses that these stupid loans have inflicted onto tremendously naive investors, which include hedge funds and European banks. These loans are still inflicting losses on investors.

In addition to subprime loans there are also Alt-A loans.
These loans, a year ago, were considered to be medium-risk loans.

They are the next loans up on the risk level from subprime loans.

Now, they are regarded as what would have been regarded as a subprime loan one year ago. They, too, are likely to go into default to the tune of hundreds of billions of dollars.

Then there are the ARM mortgages. These are adjustable rate mortgages. I have warned against these loans continually.

These loans adjust the overall interest rate structure for relatively short-term loans. This means that the borrower does not know what he is going to be paying a year or more from now.

If rates rise, his monthly payment will rise. If they fall, his mortgage payment will fall.

Then there are the least-known mortgages. They are called pay option mortgages. These are the mortgages most like Medicare and Social Security. Twenty years ago, they were called backward-walking mortgages.

BACKWARD-WALKING MORTGAGES

The pay option ARM mortgage allows a borrower to pay a minimum monthly payment. This minimum monthly payment is not a complete payment in order to amortize the mortgage over a specific period of time. Whatever portion of the monthly obligation that does not cover the full amortization of the mortgage is added to the principal owed by the borrower. So, if you would normally have to pay $1500 a month, but he decides to pay only $500 a month, $1000 is added to the principal owed.

The person who elects to do this is never going to catch up.
He has such poor understanding of debt that he signed the papers.

He put no money down. He thought he was securing his future. He was securing his eviction.

Here is a summary of these loans, written 2007, by someone who maintained an air of neutrality about these loans. The author writes as if the kind of people signing these loans were careful evaluators or risks and rewards. In fact, they were mostly first-time buyers. This sort of article was common until a year ago. They are all over the Web: “Pay option mortgages.”

http://www.garynorth.com/snip/618.htm

There are an estimated $500 billion of these loans, 60% in California. They are now about to come due. The mandatory trigger points for increasing monthly payments will start the default process rolling in the second half of this year, as the graph on the page makes clear. The first re-sets are just now beginning. They will escalate, month by month, until August, 2011. Then they trail off for a year.

http://www.garynorth.com/snip/619.htm

This wave of unstoppable foreclosures will hit the housing market for three more years, accelerating wave month by month.

The borrowers who took on these loans are generally ignorant people who know nothing about finances. These people are guaranteed defaulters. There is nothing Congress can do about this.

These loans were supposedly justified as being only for sophisticated borrowers. This was utter nonsense from 2002 onward, when they first appeared. Only misguided people borrowed by using a pay-option mortgage.

These mortgages were touted as a rational option for lenders. By November, 2009, no institution was making them.
This was reported in the “New York Times.”

http://GaryNorth.com/snip/620.htm

If they were wise loans, why aren’t lenders offering them any longer? Because they were always bonehead loans. Brokers who were being paid large commissions made these loans to people who they knew would default. Then they sold these loans to pools of investors assembled like lambs to the slaughter by Wall Street firms and major banks.

There were a few warnings in 2005. No one took them seriously. The experts made excuses for them. The experts were dead wrong. Experts will baptize any screwball investment offered by idiots in the final stages of a boom fostered by central bank monetary inflation.

One of the large banks that promoted these loans is the fast-sinking Wachovia. One site that has summarized these loans — after no one was making them — quotes a page from Wachovia’s Website. (This page has been dropped from Wachovia’s site.)

At Wachovia, we understand the importance of flexibility and choice when it comes to choosing a mortgage. That’s why we’ve teamed up with our affiliate, World Savings Bank, to provide you with a mortgage solution that lets you choose the monthly payment you’re most comfortable with.

Offers you payment choices that allow you to take
control of your finances. You have up to four different
payment options each month — Minimum Payment, Interest
Only, Full Principal and Interest, or 15-Year Payment
Option.

With the Adjustable Rate Pick-a-Payment, you could:

Make a lower monthly payment and temporarily increase your cash flow so you can free up cash for:

Retirement savings

Paying down high-interest debt

Funding college tuition

Make higher payments and pay off

your home loan sooner

Keep mortgage payments low during the initial years of your loan

Control your budget based on your individual
financial needs

http://GaryNorth.com/snip/621.htm

It sounded so good. That was then. This is now.

The experts never see economic disaster coming. They go with the flow. If something worked yesterday, it will work tomorrow . . . and ten years from now. Here is a classic example. Alan Greenspan offered this sage advice on ARMs in
2004:

Calculations by market analysts of the “option adjusted
spread” on mortgages suggest that the cost of these
benefits conferred by fixed-rate mortgages can range
from 0.5 percent to 1.2 percent, raising homeowners’
annual after-tax mortgage payments by several thousand
dollars. Indeed, recent research within the Federal
Reserve suggests that many homeowners might have saved
tens of thousands of dollars had they held
adjustable-rate mortgages rather than fixed-rate
mortgages during the past decade, though this would not
have been the case, of course, had interest rates
trended sharply upward.

http://GaryNorth.com/snip.622.htm

Thanks, Alan!

Bill Fleckenstein immediately said this advice was a
mistake, but who was he, compared to Greenspan? A nobody. He
was right, but it did not matter.

http://GaryNorth.com/snip/623.htm

With respect to pay option ARMs, there is a site on-line that sells these mortgages — or says it does. Here, we read:

“With an understanding that pay option arms are as important and respected as any mortgage product in the market place today. Take the time to see if pay option arms is the right path for your primary home, a vacation get a way or, an investment property.”

Respected? In 2008? I don’t think so.

http://payoptionarms.com

For a video analysis of the coming pay-option ARM implosion, see this by “Mr. Mortgage,” whose used to sell them.

http://GaryNorth.com/snip/624.htm

[Note: the mortgage loan implosion site mentioned by
"Mr. Mortgage" disappeared on the weekend of August 4.
So did his other implosion sites. These were great
sites that monitored the implosions in housing and
banking. I hope they return.]

DEFAULT IS COMING

Mortgage debtors who cannot make their payments have two
choices: (1) stop paying and walk away; (2) stop paying and sit tight. By far, the second choice is best for them. It is also beast for lenders. Empty house are targets.

There are hundreds of thousands of owners in this second class. They are no longer paying on at all. They are sitting in their houses, rent free, waiting for the lending agency to foreclose. Recently, Freddie Mac extended the foreclosure date to 300 days from the last payment, up from 150.

http://www.garynorth.com/snip/617.htm

So, someone with a $1000 month mortgage can get another $10,000 of free rent. Maybe he can gum up the system by making one payment on day 299, and get another 300 days.

In any case, lenders have been hit with hundreds of billions of dollars in losses. They can pretend that these losses do not exist, but they do exist. The lenders are sitting on top of hundreds of billion dollars of uncollectible mortgage debt. They are doing their best to avoid admitting to the auditorium’s that these are nonperforming loans. They are doing their best to keep these loans from being written down to zero. They are therefore not for closing on homes rapidly.

On the homes that they have foreclosed on, they are not holding auctions in which buyers can submit any bid they want, with the low bid winning. Instead, lenders are establishing a lowest-bid minimum, and this minimum is above any bid that a rational investor or buyer is willing to submit. So, the lenders buy back 95% of these properties each time they list these properties for sale. These shadow sales constitute as much as 40% of the homes sold in California. This makes it look as though the housing market is not in a state of collapse in California. It looks good, but it is a gigantic delusion.

FEDERAL DEFAULT IS COMING

As surely as holders of pay option mortgages will default, so will the U.S. government default. But there is a huge difference. Mortgage lenders can evict mortgage holders in default and gain ownership of their houses. There is no way that “lenders” to the U.S. government can evict the government for non-payment.

This relieves today’s politicians from having to make payments above the minimal required payment to be re-elected.

Year by year, month by month, day by day, the government is adding to principal owed to future retirees by not setting aside funds to pay the beneficiaries of the two old-age programs. The funds are immediately spent by the government. Any funds not paid out to today’s growing army of elderly recipients is borrowed by the Treasury and spent. The Treasury issues IOUs to the two trust funds, but these IOUs are not counted as part of the official on-budget debt.

This is deception. The voters don’t understand. Congress likes the results: deferred day of judgment.

You may think: “Why don’t people in charge blow the whistle?” Only one senior official every did. He is David Walker, the Comptroller General of the United States until early this year. He resigned to head Peter G. Peterson’s newly created foundation, which is devoted to warning the voters about the looming bankruptcy of the government.

http://pgpf.org

[Note, as is true of so many Websites, the outfit
allowed the Website designer free reign. Like all
programmers, he is young, has a huge screen, and has
chosen as his default rate 1024x758 pixels, which
produces small print. So, anyone who is older -- I am
one -- who uses maximum resolution of 800x600 cannot
easily view the Website.]

Almost no one in authority warned bankers and Wall Street firms against subprime mortgages, Alt-A mortgages, and pay option mortgages. The experts assume that the deal-makers know what they are doing. The deal-doers don’t know. As Warren Buffett has said, there are three phases of the cycle. Each is dominated by one group: (1) innovators; (2) imitators; (3) idiots. We are in phase three.

CONCLUSION

A year ago, the capital markets were hit by a crisis.
Losses are now estimated at $400 billion. That crisis continues.

It is likely to get much worse, as leveraged investments — borrowed short, lent long — produce more losses.

Almost nobody warned the public. The experts would not have listened. They never do.

Yet, without warning, the capital markets seized up. This is what happens to capital markets. Things go well for years.
Then there is a crisis. Everyone in power says, “We had no warning.”

The Federal government today can still sell its debt. There is a rush for liquidity in a recession period. But there will come a time when, just like the capital markets in August 2007, there will be an unforeseen lock-up of the market for Treasury debt. The Federal Reserve will then have to inflate by buying this debt.

The bankruptcy that is guaranteed by the two pay option mortgages known as Social Security and Medicare will be paid off in a wave of inflation. This inflation will begin long before the trust fund of Medicare goes into the red in 2017.

There will be a default. That default will be mass inflation. The on-budget debt of the United States government will force the FED’s hand before the off-budget debt does. But if it doesn’t, the backward-walking mortgage of Medicare will force the default.

We will have to take out medicine earlier or later. I predict earlier.

 

---

Gary North’s Economic Edge™

The Quest for Clarity

by Eric Rauch After last week’s article was posted, several responders questioned the need for “interpretation” at all. The argument is old and goes something like this: “The Bible is quite clear and communicates its message easily enough so that a child can ‘get it.’ People who want to ask questions about what this or what that ‘means’ are simply trying to make the Bible say more than it actually intends.” Although there is some truth behind this concern, the purists who try to make such an argument are often tragically misinformed in just how much hermeneutics—the study of interpretation—is used on a daily basis. We don’t just interpret what we read in the Bible, we interpret facial gestures, road signs, tones of voice, emails, news stories, jokes, behaviors, and any other number of things on a daily basis. Proper interpretation is the key to living in God’s world. For those who truly believe that the Bible does not need to be interpreted, I would ask the question: “Do you read the Bible in its original languages?” If not, then the very Bible that you are reading is an interpretation. In fact, a translation is an interpretation by its very definition.1 How can you be sure that the translators were correct in their judgments and decisions? How do you know that they did not introduce their personal biases and beliefs into their translation? And for those of you who do read the original languages, which one do you read? We don’t have the original manuscripts of Paul, Isaiah, or Moses, so how do you know that your “copy” is an accurate one? Do you ever get something new out of a familiar passage? If so, then which interpretation is correct, the “new” one or the “old” one? These are difficult questions that everyone must wrestle with, believer and unbeliever, Protestant and Catholic, Jew and Gentile. I see a clever billboard each day on my commute home. It is an advertisement for McDonald’s and specifically for their breakfast items. It has a picture of an Egg McMuffin and the text beside it says: “First we break ‘em, then we fix ‘em.” In order for this sign to communicate what is intended, the reader must do a double-interpretation of the word “fix.” At first glance, the sign seems to be communicating “fix” as the opposite of “break,” as in: “Dad fixed the broken lamp.” But what the sign is really doing is equivocating on this formal meaning of “fix” and substituting the less formal meaning of “prepare” or “cook.”2 But, without the picture of the Egg McMuffin, this second meaning would never come out. If the McDonald’s marketing team had attached this text to a picture of french fries or a milkshake, the equivocation of breaking and fixing eggs would have been lost; the sign would have been meaningless. McDonald’s is counting on viewers to be able to interpret their sign—to “get” the equivocation and catch the humor—based on the amount of information given. In this instance, context is paramount to proper interpretation. Another example comes from Richard Pratt’s book, He Gave Us Stories. Pratt tells a short story of an individual named John who finds a piece of paper containing the cryptic message: GET HELP! John was a competent reader of English; he had a basic understanding of what “get” and “help” mean. At first, John thought he knew what the note meant. But two strangers suddenly came up to him. The first one pointed at a passing car and said, “I saw where that note came from. A little boy dropped it as he was pulled into that car. You’d better call the police.” But the second person interrupted. “Don’t listen to him,” she insisted. “I wrote the note for a friend and dropped it by accident. My friend is sick, and I want him to get some help.”3 Just as John came to learn, words are open to many interpretations, depending on context. Was this note a plea for help from a scared child, or was it good advice from a concerned friend? John had no way of knowing which stranger was giving the right context so he went away frustrated, realizing that the note could mean many things. Even two-word sentences are not free from interpretive arbitrariness. So then, what’s to be done? If even a simple sentence can be misinterpreted, how can we possibly hope to understand the comprehensive story of the Bible? One emailer asked me about the “analogy of faith,” which I broadly defined as using the “clear” passages of Scripture to help interpret the “unclear.” His question was: “Who gets to decide what’s clear and what’s unclear?” This is a very perceptive question. The analogy of faith can be subjective, just like every other interpretive tool. This emailer further made the point that some see James 2 as being the “clear passage” while others understand Romans 4 to be “clear” on the issue of faith and works. Quite true. Is there a resolution to this? Can we ever get away from the subjectivity? We’ll look into this more in the weeks to come… Eric Rauch is the Director of Communications of American Vision.