Palmer on Protestors

by Don Boudreaux on October 22, 2011

in Uncategorized

Tom Palmer wisely prefers tea-partying to occupying Wall Street.

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EG October 22, 2011 at 1:48 pm

Hmm. Someone should tell this to Ron Paul and Gary Johnson, because they seem to be barking up the wrong tree. It shows a distinct lack of seriousness and awareness to go to a camping ground of human waste, and with a straight face say “yeah these guys are just like the tea party. They are frustrated too!”…as if being “frustrated” is somehow all it takes. It takes a special kind of confusion to go there and say “oh yeah I’m against the war too! So we’re the same!”…or “oh yeah some of these guys are against the government too!”. Yeah Gary…thats cause they’re communists. Communists don’t like “the government”. They like “their government”. You’ve never talked to a communist before, Gary?

The lukewarm reaction of some “libertarians” have given to this absolutely violent communist group…is really off putting, to me. The people who should be out there promoting ECONOMIC freedom through every mean, are there trying to “make friends” with creatures that would eat them at any opportunity. Being “against the war” and “for drugs” are not sufficient qualifications to make these creatures, my “allies”. Gary Johnson and Ron Paul need to go away before they make a bigger mockery of themselves, and “us”

Aedigus October 22, 2011 at 2:40 pm

About a year and a half ago, I made friends with a communist. Over the course of many long discussions, I gradually converted him into a hardcore free market libertarian. As of now he’s actually becoming even more radical than I am, flirting with the idea of anarcho-capitalism.

Now, this would never work with most of these people. It takes a great deal of intellectual honesty and courage to really listen to arguments that contradict your worldview and sincerely weigh them. Some subset of the OWSers, however, are sure to be like my friend: sincere, fundamentally good people who have been terribly miseducated. To the extent that these people exist, it’s worthwhile to try to reach out to them.

Justin P October 22, 2011 at 3:39 pm

You can pick off at the margin, but that isn’t going to change the fact that most of the OWS are never going to have the intellectual honesty needed to listen to an opposing view. You have to pick your battles strategically. Spend a year trying to convert a handful of #OWS or go after the source of their economic ignorance….public education.

EG October 22, 2011 at 4:48 pm

It depends on how young/old your friend was, how serious he was, how he reached his conclusions on communism and capitalism etc. Of course people change. Of course young people change their minds several times…even on fundamentally critical issues like this.

He’s not engaging them in discussions. He’s pandering to them. I don’t necessarily see the benefit of making a fool of oneself by appearing next to this heap of human garbage and and say “yeah we agree on a lot of things, so you guys are just like us!”.

No they are not.

These are the monstrous vile creatures than in 1967 China would have hung Ron Paul from a tree. The same vile human waste than in 1917′s Russia would have shot Ron Paul in some back alley. The same violent mob that in 1789′s France would have cut off his head. The same murderous mob that in 1933′s Germany would have send him off to the death camps.

These are not people to be joked around with.

Justin P October 22, 2011 at 3:37 pm

I think Paul is going for the “End the Fed” OWS types. I think he is mistaken as well. I think most of the Libertarians that are warm to OWS are Leftatarians. They think they can convert a few on the margin.

EG October 22, 2011 at 4:41 pm

Ron Paul is as confused and intellectually bankrupt as any OWS creature out there, whether it be for his Fed stance, his Gold stance, or any number of other craziness that comes out of his mouth. The fact that he tries to court some hardcore communist types…is indicative of the lack of seriousness in Paul.

Just because 2 people may agree on 1 thing, doesn’t mean they reached that same point from the same direction, for the same reasons, or have the same end results in mind.

Nikolai Luzhin, Eastern Promises October 22, 2011 at 11:19 pm

you credit Ron Paul with too much

Invisible Backhand October 22, 2011 at 2:18 pm

“What caused the crisis, the indebtedness, the unemployment, the stagnation? The culprits are state agencies and enterprises, including our Federal Reserve (our government’s bank), Federal Housing Administration (FHA), Federal National Mortgage Association (Fannie Mae), and Federal Home Loan Mortgage Corporation (Freddie Mac), which jointly flooded the country with…”

He forgot the CRA but maybe he didn’t want to go the full Limbaugh. Why are big financial institutions are conspicuously missing from the list? I notice the single politician mentioned is a Democrat while Republicans are also conspicuously missing–He couldn’t find any conservatives with blood on their hands?.

Amateurish propaganda even by Tea Party standards.

Don’t forget to check out the rebuttal by Peter Rothberg:

The Tea Party feigns indignation at Washington while finding itself and its funders well-served by DC’s corruption, while OWS is a genuine protest against the status quo.

Randy October 22, 2011 at 3:10 pm

The OWS folks want handouts. They’re in the wrong town. Manhattan doesn’t give handouts. Washington gives handouts.

Invisible Backhand October 22, 2011 at 3:35 pm

By now you’ve had a chance to read hundreds of their signs, did you see any asking for a handout?

Justin P October 22, 2011 at 3:40 pm

Do you call asking for someone else to pay for his tuition a handout?

Here’s your sign:

Invisible Backhand October 22, 2011 at 4:33 pm

“In picking someone out from a crowd, one runs the risk of being accused of cherry-picking. So be it.”

GhengisKhak October 22, 2011 at 6:39 pm

You asked if anyone was asking for a handout. Within 5 minutes you are shown proof to the positive. Then you move the goalpost.

Methinks1776 October 22, 2011 at 4:33 pm

Yes, along with heaping helpings of anti-Semitism.

Randy October 22, 2011 at 5:36 pm

Seriously, IB? I can’t think of one that isn’t asking for a handout. Can you?

Invisible Backhand October 22, 2011 at 5:46 pm

all the ones asking for jobs?

Randy October 22, 2011 at 6:34 pm

They’re not asking for jobs. They’re demanding jobs.

Invisible Backhand October 22, 2011 at 8:26 pm

so they are not asking for or demanding handouts?

Josh S October 22, 2011 at 11:42 pm

Demanding someone give you a “job,” i.e., someone give you money regardless of whether you are capable of doing anything of value, as long as you show up at some place and at least act busy for eight hours, is demanding for a handout.

Invisible Backhand October 23, 2011 at 9:50 am

How about a “job” as it is normally defined?

Randy October 23, 2011 at 10:41 am

Anyone who has ever held a real job knows that Josh is exactly right.

vikingvista October 22, 2011 at 5:47 pm

“Sixty-five percent say that government has a moral responsibility to guarantee all citizens access to affordable health care, a college education, and a secure retirement”

House of Cards October 22, 2011 at 7:18 pm

Yes. A number of signs say “Bail out the People!”

That’s a demand for a handout.

Those signs might be hard for you to see because they’re obscured by the big red flag someone hoisted up with the image of Che Guevara.

I work in the area so I see all the signs. I also liked the one that said “Down with consumerism! Down with international corporations!”, especially when the holder of it was wearing Timberland boots and sported an Android smartphone.

Methinks1776 October 23, 2011 at 9:41 am

Ha ha ha!!!!

Rob October 22, 2011 at 3:48 pm

Yeah, handouts to Wall Street! Look man, can’t you admit that OWS really have a similar point there? They want to end corporate bailouts in much as same way as to many Libertarians.

Ken October 22, 2011 at 4:23 pm


This is incorrect. The OWS’ers are for bailouts. These people are looking for a bailout for themselves. They care nothing about reduced and responsible spending by government. They simply want the government to give them money too.

The Tea Party is about reduced and responsible government spending, not about asking for a government hand out.


Invisible Backhand October 22, 2011 at 4:35 pm

You found the same video Justin P did.

“In picking someone out from a crowd, one runs the risk of being accused of cherry-picking. So be it.”

Mesa Econoguy October 22, 2011 at 4:44 pm
Ken October 22, 2011 at 4:50 pm

Here are the official demands of OWS. Here’s what they translate to:

1. Government get more involved in a situation the turned to shit all ready.
2. Don’t worry about any of the government officials involved in the situation they personally turned to shit.
3. Enact legislation abridging free speech.
4. Ignore the thousand year tradition of “equal before the law” and treat those who have more than almost all humans (typical American) differently than those who have even more (person who is rich by American standards).
5. Begs the question.
6. Enact even more legislation to abridge free speech.
7. I support this type of legislation.
8. People who cooperate to share knowledge and experience in order to achieve shared goals shouldn’t have the same rights as those who don’t.


House of Cards October 23, 2011 at 5:49 pm

They want to end corporate bailouts in much as same way as to many Libertarians.

Once more:

Tea Party demonstrators want to end all bailouts, irrespective of the recipient. Kapish?

The Great Unwashed of Occupy Wall Street want merely to redirect bailouts to themselves.

Seems like a clear and essential difference between the two agendas.

Mesa Econoguy October 22, 2011 at 3:10 pm

Because the big financial institutions are secondary players. Without government driving lending standards into the ground, and setting loan targets, there are no bad mortgages, no housing bubble, and no securitizations of those bad mortgages.

Thanks for going full retard, idiot.

Invisible Backhand October 22, 2011 at 3:34 pm

De nada. I wish I could live in your and Tom Palmers’ fantasy world, where everything is so simple.

Mesa Econoguy October 22, 2011 at 4:40 pm

We just wish you would shut up.

Invisible Backhand October 22, 2011 at 5:22 pm

Never let the troll know they are getting to you. It’s how we feed off of your life force, clown.

Mesa Econoguy October 22, 2011 at 5:43 pm

Interesting theory, now shut up.

Invisible Backhand October 22, 2011 at 5:47 pm

Go fuck your mother. I did.

Mesa Econoguy October 22, 2011 at 5:49 pm

You speak well for the left.

Shouldn’t you be down at the protest drinking your own piss?

Off you go, pillock.

GiT October 22, 2011 at 4:41 pm

Why was government driving lending standards down? (Funny how on this point you’re arguing for federal regulation).

Oh, right, because of lobbying by the NAR.

Mesa Econoguy October 22, 2011 at 4:56 pm

Wrong, NAR may have been along for the ride, but Jim Johnson (failed Mondale and Kerry campaign manager, ex-Obamalini advisor 2008) at Fannie Mae was relentless in his lobbying and regulatory capture efforts, and his eventual “partnership” with Henry Gonzalez (D-TX). Fannie drove nearly all of the major housing legislation in the 1990s, which coincided nicely with botched lending studies misidentifying a case for lending “affirmative action.”

Henry Cisneros and Andy Cuomo (both Clinton HUD sec’y) both added loan and lending targets in their foolish and naïve quest for lending “equality.” CRA was a product of this stupidity, though it was only a component of the overall failure.

This is all nicely documented in Reckless Endangerment, Gretchen Morgenson with Joshua Rosner, in case you decide to open a book.

Invisible Backhand October 22, 2011 at 5:48 pm

What are you still doing here? I told you to go fuck your mother.

Mesa Econoguy October 22, 2011 at 5:52 pm

LMAO, that seems not to have worked.

How’s the protest going, pig? Anybody shoot you yet?

Invisible Backhand October 22, 2011 at 7:00 pm

Be seeing you, Greg Patterson.

Mesa Econoguy October 22, 2011 at 10:36 pm

LMAO, more.

Wow, your internet detective skills are poor, Visible Bonehead.


Mesa Econoguy October 23, 2011 at 3:57 am

Look, little girl, stay the fuck away from your interwebs, ok?

Invisible Backhand October 23, 2011 at 9:54 am
Mesa Econoguy October 23, 2011 at 9:15 pm


Invisible Backhand October 24, 2011 at 1:26 pm

Your neighbors are going to find out a child molester lives next to them.

Mesa Econoguy October 23, 2011 at 3:49 am
Nikolai Luzhin, Eastern Promises October 22, 2011 at 11:24 pm

hate to bother you with the facts but collectively, all of these loans are less than 20% of the bad papers sold by US investment banks.

second, the problem wasn’t the asset bubble that the fed permitted.

the problem was the fraud the fed permitted. everyone forgets that the first duty of the fed is loan quality, based on soundly applied underwriting standards. During the 1990s the FDIC, OCC, Fed, etc. developed more than adequate regulatory tools to assure that sound loans were being underwritten. When Bush became president and with Greenspan at the Fed all enforcement of safety and soundness stopped. The frauds that took place were what happens in a free, unregulated financial market.

Greg Webb October 23, 2011 at 1:30 am

Nikki, you are prevaricating again. The federal and state bank regulatory authorities still don’t have a way to ensure that sound loans are underwritten.

Mesa Econoguy October 23, 2011 at 3:41 am
muirgeo October 22, 2011 at 3:41 pm

Of course he supports the Tea Party because he is a shill for the Cato Institute which basically is the Koch brothers organizatrion of 1 percenters that funded the Tea Party movement. It’s not truly a grass roots movement. That’s very well documanted. It will be steam rolled by history and the movement that is OWS.

OWS has far better public opinion rating both here and overseas.

When you are siding up with fanatic religious creationist you know you yuourself are in a desperate place.

Invisible Backhand October 22, 2011 at 5:24 pm

ixnay onnay ethay ochkay rothersbay oray ouya illway etgay annedbay.

DB forgot to mention that the Institute for Humane Studies (Palmer) and Mercatus Center (Boudreaux) share the same building.

Mesa Econoguy October 23, 2011 at 1:25 am
Mesa Econoguy October 23, 2011 at 1:30 am

What a fucking joke.

Mesa Econoguy October 23, 2011 at 1:54 am

tenant = a renter

tenet = a principle or belief

See? Basic English is fun!

Mesa Econoguy October 23, 2011 at 2:25 am
Mesa Econoguy October 23, 2011 at 3:08 am

God, that’s funny shit!

Sorry, I accidentally read it again!!!!

You write that yourself?

Mesa Econoguy October 23, 2011 at 3:23 am

LMAO, sorry, Jane….can’t help it…

Mesa Econoguy October 23, 2011 at 3:25 am

Scheit, read this while I gather my wits….

Tom G. Palmer October 25, 2011 at 11:08 pm

Invisible….I did work years ago (1995) at the Institute for Humane Studies. What is your point? Do you have one?
I think that Don Boudreaux’s office is way out in Fairfax, but I’m not sure, as I’ve never visited it. What is your point in bringing that up?
Are you suggesting that my opinions are bought by someone? If so, by whom? Are your opinions for sale? If so, to whom?
When one stoops to questioning the motivations of others, it is a sign that one has no argument. Think about it.

MWG October 22, 2011 at 8:30 pm

Ah Yes, those evil Koch brothers with their anti-war, pro drug legalization, anti-corporate welfare ways.


Josh S October 22, 2011 at 11:44 pm

I actually get paid $50 by the Koch Brothers every time I comment here.

Mesa Econoguy October 23, 2011 at 1:02 am

Oh, look, here’s my e-check from the Koch Brothers!

They doubled my pay!


Show me your OpenSocity/ check, infantile pillock.

Polly October 23, 2011 at 7:45 pm

NOW I hear about it! Muirgeo, if the Koch brothers (or anyone else) are funding the TEA Party, someone owes me a bunch o’ cash.l

Please post the address where I may demand my payment for attending TEA Party events.

Thank you very much.

House of Cards & Economic Freedom October 24, 2011 at 10:27 am

It’s not truly a grass roots movement. That’s very well documanted.

I hear that a lot — but only when it’s documented by the far left. It’s called “re-writing history.” In February 2009 the first NYC Tea Party demonstrated in City Hall Park; about 100 demonstrators showed up. By 15 April 2009 (Tax Day) there were about 10,000 people marching on Chambers Street, by City Hall Park, demonstrating against government spending and government intrusion into every aspect of their lives. Over the 2009 September 11 weekend, almost a million Tea Party demonstrators from around the country marched on Capitol Hill.

It will be steam rolled by history

Only if the left has a monopoly on writing the history textbooks.

and the movement that is OWS.

Zuccotti Park near Liberty Plaza is quite small. At most, there are only a few hundred people there. Most of them stay overnight in old sleeping bags (made by corporations), black plastic garbage bags (made by corporations) or wrap themselves up in big, blue plastic tarps (made by corporations).

Organizers of OWS include Lisa Fithian and Debra Sweet (the latter recently arrested). Fithian is a “community organizer” who has organized and participated in direct action (i.e., violent) demonstrations around the country for many years. Debra Sweet is also a “community organizer” and director of an organization called “World Can’t Wait,” one of many front groups for the Revolutionary Communist Party USA.

It’s all very well documented.

Methinks1776 October 24, 2011 at 10:30 am

For somebody who craps and then sleeps in a park “Filthian” is an unfortunate last name that she is no doubt proud of.

Charlie October 22, 2011 at 3:57 pm

Yeah, that was a coherent piece.

Stop the cronyism, but don’t blame the cronies. Stop the rent seeking, but not the rent seekers. Stop the government policies, but ignore the people that lobbied those policies into existence.

Ken October 22, 2011 at 4:34 pm

That’s correct, Charlie. If the government didn’t give away money, then there would be no cronies. If there were no rents, there would be no rent seekers. If politicians didn’t write legislation catering to lobbyists, there would be no lobbyists. In case you didn’t know, cronies aren’t the ones taking from taxpayers, politicians and bureaucrats are. In case you didn’t know, rent seekers don’t hand out rents, politicians and bureaucrats do. In case you didn’t know lobbyists don’t vote legislation and write regulation into existence, politicians and bureaucrats do.

If only we had some sort of document, some sort of “declaration” or “constitution” detailing the problems of government and devising government to be limited to certain powers to limit cronyism, rent seeking, and special interest legislation. Too bad nothing like that actually exists, right?


Invisible Backhand October 22, 2011 at 5:27 pm

I can hear Ken “Why do you make me hit you?” and the wife fighting in the apartment upstairs again.

Ken October 22, 2011 at 10:27 pm

Ha! The best you can do is to make wild accusations independent of any sort of facts.

You’re a riot, IB.


Mesa Econoguy October 23, 2011 at 1:04 am

And to think, Ken used to be the most abusive.

Aaah, memories…..

Mesa Econoguy October 23, 2011 at 1:15 am

Sorry, Ken, that actually was a compliment.

In a very weird way.


Charlie October 24, 2011 at 8:20 pm

One cost of rent seeking is the public shame involved in being a rent seeker. If the public shame is high and rent seeking is a low status occupation, then the returns to rent seeking will be less under any gov’t institutional structure.

The author’s view is incoherent. Clearly, he is against Occupy Wall Street and looking for reasons to support that view. The examples the author gives are ways in which the OWS view actually compliments the tea party movement, rather than contradict it.

That isn’t to say one can’t be for the tea part and against OWS for coherent reasons (Russ gives an example today). It’s just that this author gives incoherent reasons.

Methinks1776 October 22, 2011 at 4:39 pm

In other words, “stop doing things that don’t yield the results that you want”. Seems pretty coherent to me.

You see, if you get rid of one set of cronies, another will pop up. Stop one set of Rent Seekers, another will pop up. The OWSers don’t have a thing against cronies or rent seekers any more than the Russian peasants had a thing against abuse and exploitations. Like the Russian peasants, the OWSers just want to be the ones doing the abusing and exploiting. The OWSers want to be the rent seeking cronies.

Charlie October 24, 2011 at 8:35 pm

“stop doing things that don’t yield the results that you want”

Haha, who do you think you are talking to?

The tea party movement is relying on recapturing gov’t. An attempt every Virginia School model would argue is sure to fail. The incentives don’t align well enough, the tea party movement will be captured by the powerful interests that lobby washington and won’t ever actually change anything, except possibly a small move of the marginal voter in the short term.

The OWS movement is direct shaming from the consumer. It doesn’t rely on getting elected and being a high minded bureaucrat willing to uphold the constitution, avoiding the great temptations of gov’t excess and always admitting when they chopped down the cherry tree. It’s much more plausible to change the relative status of financial institutions making every status dependent cost – lobbying, hiring, marketing higher.

BTW, I don’t think either movement will be particularly successful.

kyle8 October 22, 2011 at 9:27 pm

Hey dumbass, I blame them both OK?

But the fact remains that government has too much power to begin with and since people are always subject to temptation, best to take away the temptation in the first place.

Nikolai Luzhin, Eastern Promises October 22, 2011 at 11:28 pm

we live in a world that requires that gov’t have enormous powers

right now, as Observer first warned, and as we have repeated, the balance of Modernity now lies in the hands of a very fragile Europe.

Events may develop to where all of the powers of our Federal Government may be required to stop the contagion, even though, for example, we had very little to do with what has happened in Greece, Italy or Spain or France.

There as 7 billion people on the planet with lots of nasty toys. Peace will always challenge us

Mesa Econoguy October 22, 2011 at 11:38 pm

“we live in a world that requires that gov’t have enormous powers”

Look, puddle, The Kremlin this ain’t, capiche?

Like it or not, this government has 9.1% unemployment, and has failed in every measurable economic metric to improve that.

Frankly, you’re not qualified to be Der Kaiser any more than Joe the Plumber. He’s more qualified than you, actually.

Josh S October 22, 2011 at 11:45 pm

What we need is a dictatorship of the proletariat to stamp out the limiters and the wreckers.

Mesa Econoguy October 23, 2011 at 12:10 am

I get paid $5000 by the Koch brothers to post after you.

kyle8 October 23, 2011 at 1:54 pm

utter bullshit, we live in a world in which it is increasingly harmful for governments to have enormous power.

House of Cards & Economic Freedom October 24, 2011 at 10:33 am

the balance of Modernity

Ah, glad you clarified your position.

Whenever leftists start prattling about “the balance of Modernity” (with a capital “M”), you know you’re in the presence of one of Eric Hoffer’s True Believers — a fanatic, and very likely one who will turn to violence to get what he wants. After all, from his point of view, “Modernity” itself is at stake.

Stephan October 22, 2011 at 4:12 pm

Very nice. Some reactionary from the CATO institute weighs in. The reactionaries from Cafe Hayek applaud. I’m sure The People from OccupyEverything will be very impressed. Why the right-wing egghats at Cafe Hayek being on the pay-list of the Koch brothers think anybody of OccupyEverything pays attention to their propaganda is beyond me. Your audience is some disturbed middle-aged white male! By the way: these guys normally hate free trade. They probably need some education?

vidyohs October 22, 2011 at 5:41 pm

Spend a lot of time trying to demean a meaningless blog, don’t you?

You loonies actually and mistakenly think you’re intelligent.

kyle8 October 22, 2011 at 9:28 pm

Lets see, I think you actually got every single thing wrong in your little screed, but thanks for playing.

vidyohs October 22, 2011 at 4:14 pm

You (rhetorical you) got a problem with a bank, it can only be because you went into a bank and asked for service(s), and then signed some sort of agreement that obligated you. So, do the rest of us listen to you bitch and blame the bank, no, why should we? We blame you, you should have stayed the hell out of the bank.

The banks did not cause your (rhetorical you) problem. The government did not cause your problem. Neither forced you to ask for debt. You (rhetorical you) caused your own problem because you were stupid enough to be sucked in by their advertising and promises.

Personally I have no problem with any bank. I don’t deal with any bank. The convenience of a debit card or a credit card is off set by my security at knowing that no bank can manipulate me. Nor can the government (IRS) reach my funds through a bank.

This is just a simple fact of life:
A loan not requested is a loan not made.
A loan not made is a loan that can not create obligations.
A loan not made is a loan that can not be manipulated.
A loan not made is a loan that can not be foreclosed.
A loan not made is a loan that is no trouble to anyone.

If you (rhetorical you) have a problem with debt, it is because you were stupid enough to ask for the debt.

Personally I practice delayed gratification and buy nothing until I can pay cash; and have no sympathy or concern for those who do not do likewise.

GiT October 22, 2011 at 4:45 pm


No one forces a bank to issue a risky loan. If banks don’t do their due diligence and make loans they shouldn’t have that’s their fault.

Both the borrower and the lender take on the risk of loan. Who bears the brunt of the risk when the loan goes bad is a political choice.

vidyohs October 22, 2011 at 5:40 pm

Even the obvious is too much for a dense looney like you.

Darren October 22, 2011 at 6:25 pm

I took GiT’s comment to mean lenders should have to suffer the consequences of their bad decisions, too. I may have misunderstood, but I don’t have a problem with that.

vidyohs October 22, 2011 at 7:55 pm

If you read my comment and GiT’s stupid reply, and were confused; then God help you, you too are a danger to yourself.

Methinks1776 October 22, 2011 at 9:19 pm

I agree, Darren. Except that firms regulated to death like banks often don’t have choices. If they didn’t lend to a politically protected group, they were threatened with regulatory investigations.

As long as we have regulation instead of, say, private certification, we’re going to get more of these distortions.

Dan Phillips October 22, 2011 at 9:41 pm

Correct me if I’m wrong, Methinks1776, but I think the relationship between the regulators and the regulated is a little more cozy than you imply. Almost certainly when the regulatory agencies meet to set rules the regulated banks have “their man” on the committee, looking out for their interests, making sure the regulations protect them. Wasn’t that part and parcel of the bailouts? From my point of view the “poor, downtrodden corporations” are just as guilty as the g-men. That’s why it’s called crony capitalism, and that’s why libertarians should be as harshly critical of the so-called regulated as the regulators.

GiT October 22, 2011 at 11:07 pm

Oh please, the poor little banks were not bullied into originating loans. If quotas are a problem you can simply decrease lending volume until you can tolerate the required ratio.

Whether or not there should be a ratio is a separate matter from whether, given a percentage quota, you are somehow ‘forced’ to make bad loans.

You make bad loans if you think you can profit off them. You can profit off them if you can socialize or otherwise pass off the risk. And boy was that risk socialized or passed off to others.

Regulatory investigations of the banks for fair lending aren’t ‘threatened.’ You can’t ‘threaten’ someone with a routinized enforcement regime that investigates every Federally regulated bank’s practices at the very least on a biannual basis.

The routine character of fair lending investigations is, in fact, relatively unique as far as regulatory investigations into discrimination goes. For most other types of discrimination, federal investigations are not routinized, and accordingly are capable of being threatened.

Methinks1776 October 23, 2011 at 9:20 am

Dan Phillips,

It’s not exactly as you describe.

The larger and more politically connected the entity, the more chance it has of reg capture. The regs usually hurt the smaller competitors – they’re meant to. So, not all regulated entities are treated the same and not all are cronies. Most aren’t.

The large and politically connected entities help write the regs. The smaller firms don’t get a seat at the table – which means that most of the industry does not help write the regs. For instance, in financial regulation, reg NMS was written almost entirely by NYSE. None of the regional exchanges got a say. The regulation is advertised as better for market participants, but all it did was decimate the smaller exchanges that compete with NYSE (who are no forced to send orders away – mostly to NYSE) and gave rise to more dark pool trading, increasing the adverse selection problem for anyone smart enough to hedge their execution risk with limit orders.

The backscratching goes both ways. The regulators have to carry water for the politicians. The large firms will only do it if they get something in return – barriers too high for competitors to clear in certain businesses or a bailout if things go bad, as just two examples. One way to get ensure one is to become to big to fail. That means that more regulation is always better for the big guys with economies of scale. For their competitors, the rising regulatory wall becomes impossible to breech.

non-cronies were also forced to lend to the less credit worthy- whether to stay competitive or because they were literally forced by the regulator’s threats. It’s usually a mixture.

As for treating cronies and regulators as equals, it’s a losing game. As long as government creates rents, they will be sought. As long as government threatens to interfere with markets, inducements to follow the program will have to be created. The core issue is government interference, which piles regulatory risk and additional costs on top of market risk and normal business expenses. Somebody has to pay for all the regulation. Inevitably, it is the customers and the taxpayers. And inevitably, they never get what they pay for, but pay they must because choices are denied them by the very same regulators.

Methinks1776 October 23, 2011 at 9:29 am

Oh please, the poor little banks were not bullied into originating loans. If quotas are a problem you can simply decrease lending volume until you can tolerate the required ratio.

No you can’t. Not if you plan to remain competitive and retain market share. Otherwise, you might as well go out of business. If you get too small, you can no longer afford the the fixed cost of regulation.

You make bad loans if you think you can profit off them. You can profit off them if you can socialize or otherwise pass off the risk. And boy was that risk socialized or passed off to others.

Uh-huh. You can thank politicians for that. No bank has the power to rob taxpayers. Only government has that power. And you can thank government for the now YEARLY bailouts Fan and Fred are getting. Anyone check into their CEO’s compensation, btw? Tens of millions for getting over $100 Billion in taxpayer bailouts annually?

Regulatory investigations of the banks for fair lending aren’t ‘threatened.’ You can’t ‘threaten’ someone with a routinized enforcement regime that investigates every Federally regulated bank’s practices at the very least on a biannual basis.

Regulatory investigations are not routine. Regulatory exams are routine. Investigations only happen if the entity is believed to be doing some shady. Investigations make the news and are very bad for business. It doesn’t matter if they don’t find anything or if the investigators merely find that the bank is not willing to lend to the unworthy. Most of their customers are not savvy enough to understand and will boycott them.

GiT October 22, 2011 at 6:58 pm

I would have thought it was obvious that a debt requires both an issuer and a borrower, and as such the borrower is not solely responsible for the transaction.

But such arcane facts seem to be quite beyond you.

I leave it to others to judge who is insane – he who thinks only borrowers are responsible for loans, or he who thinks both borrowers and lenders share culpability.

vidyohs October 22, 2011 at 7:51 pm

“No one forces a bank to issue a risky loan. If banks don’t do their due diligence and make loans they shouldn’t have that’s their fault.”

Christ you are thick. Let me make it real simple for you:
“This is just a simple fact of life:
A loan not requested is a loan not made.”

Even an idiot like should be able to understand that. Do you now begin to see what a f..king idiot reply you made?

No bank can make a risky loan to a non-existent borrower. If no one comes in and asks for a loan, no bank can issue a loan, risky, good, terrible, nothing…… it dipshit?

The one who asks to borrow is the one who sets the whole thing in motion…….got it dipshit?

Don’t ask to borrow and you don’t have any problem, no bank can screw you over on a loan that you never made……got it dipshit?

1 plus 1 = 2………got it dipshit? How much mo simple do it gotta be for a looney to understand?

Does your mother or your husband know you play with computers? Aren’t they smart enough to keep you away from things that might get you in trouble? I hope they keep flammables, explosives, matches, sharp objects, and intoxicants out of your reach, you are a danger to yourself.

Anotherphil October 22, 2011 at 7:56 pm

How about people who blame lenders alone?

There’s another party to be “blamed”-the government which insisted that loans were issued to meet social standards that not only had nothing to do with creditworthiness, solvency or profitability, but actively undermined those considerations.

GiT October 22, 2011 at 8:21 pm

That’s quite the tantrum, child.

Mesa Econoguy October 22, 2011 at 10:45 pm

Dirty little rat-faced, just because you were too stupid to sign the mortgage which cost you a shitload doesn’t mean you get to blame everyone else for your stupidity, k?

You are to blame. For a great many things.

Anotherphil October 22, 2011 at 7:46 pm

“Who bears the brunt of the risk when the loan goes bad is a political choice.”

Actually, that’s not true. Both parties face risks. They are created by the terms of the contract.

GiT October 22, 2011 at 8:28 pm

And when people declare bankruptcy or demand liens on people’s income or reposses their property for violating a promise, look where you find yourself – at politics and the state and public, constitutional law.

Pacta sunt servanda doesn’t enforce itself. And, in fact, sometimes pacts aren’t served, because they can’t be. And when they aren’t, the limits to what you can do about that are… political.

Mesa Econoguy October 22, 2011 at 11:00 pm

But dictum meum pactum does.

That is what matters. This is what you have destroyed in your bullshit leftist equality-of-poverty crusade, ignorant fuck.

All of your bullshit regulation – including and especially Doddering Frankenstein – are Rube Goldberg props for your dystopic utopia are layers of crap constructed to destroy society.

You think this shit will save you next time, Darth Nader? News Flash: It’s about to get a whole lot worse, mostly because you fucking lefturds can’t keep your dick in your spending pants with the bitch of “free” social spending with other people’s money.

Ignorant fucking prick.

Economic Freedom October 22, 2011 at 11:33 pm


You’ve gotten to be extremely nasty and abusive. You need to fall into a spider’s web and be cocooned and digested. A spider can at least spin a web, while you can only spin a veil of tragic tears and spite. You need to take your caustic unpleasantries elsewhere.

GiT October 22, 2011 at 11:42 pm

More tantrums from the cry babies, I see.

I don’t have any crusades, or any regulations, or any government spending. (I’m not sure I’ve even suggested any anywhere on this site.)

For nearly as long as people have pledged their words, people have been unable to fulfill their pledges. Dictum meum pactum falters against reality, not willpower. Risk is proper to anything which banks on the future.

As Justinian put it, Omni quoque corporali cruciatu semoto, Inhumanum erat spoliatum fortunis suis in solidum damnari.

Though I’m sure you’d rather return to the more ancient law of the Twelve Tables: Tertiis nundinis partis secanto. Si plus minusve secuerunt, se fraude esto.

Yes, I have no doubt you’d rather take your pound of flesh.

Mesa Econoguy October 22, 2011 at 11:43 pm

EF you are correct.

Stand back, and down.

Mesa Econoguy October 23, 2011 at 12:30 am

Sniveling Git, I’m sure you’re not a proponent of regulations, except when they fail, and I’m more than sure you attribute market failure to regulators, given the expansive regulations which already exist.

But we just need more failed regulations, with failed regulatory enforcement bodies now, don’t we?

Nikolai Luzhin, Eastern Promises October 22, 2011 at 11:39 pm


law determines what contract terms are or are not enforceable.

without law there are no contracts

there are sound studies that show that non-recourse lending leads to better loans and a healthier economy. (lenders have to provide more services for borrowers to assure that loans are repaid; look at efforts, for example, that VC funds make for companies in which they invest

Mesa Econoguy October 22, 2011 at 11:50 pm

Shouldn’t you start pounding your shoe now?


Mesa Econoguy October 23, 2011 at 2:11 am

Are you referring to these loans, asshole?

I have a follow-up question, ignorant shitbag:

Who the fuck do you think you are to pledge additional taxpayer money to your failed cause, asshole?

Mesa Econoguy October 23, 2011 at 2:39 am

Another follow up question:

How dumb are you to think that 9.1 % unemployment is an endorsement for US Government venture capitalism?

Mesa Econoguy October 23, 2011 at 2:44 am

Another another follow up question:

How dumb are you leftist morons?

9.1% fucking unemployment, and you make fun of libertarians? And “Conservatives”?

House of Cards & Economic Freedom October 24, 2011 at 10:42 am

No one forces a bank to issue a risky loan.

Wrong. Banks were told that if they did not issue more loans to high-risk borrowers, regulators would prevent them from creating and marketing new financial products, and prevent them from opening up new branches. It started under Carter and continued on steroids under Clinton. The stated propaganda on their part was to stop the banks from “red-lining” and to broaden the “American Dream of home ownership” to more people (irrespective of whether they could actually afford a home).

Thus, the “American Dream” was switched from “freedom” and “leave me alone and let me live my own life” to “home ownership” and “let me borrow lots of money on easy terms.”

Nikolai Luzhin, Eastern Promises October 22, 2011 at 11:32 pm

your attitude about debt shows a real lack of intellectual maturity and a failure to understand the paradoxes of life.

Debt, which is just one from of capital, is essential to modern life. If you want to defeat Modernity the first thing you do to defeat entrepreneurs is to outlaw lending money at interest. The best thing that happens when money is not lent at interest is Loan sharking and its gets a lot worse from there.

Mesa Econoguy October 22, 2011 at 11:50 pm

Hilarious Nikki.

And there you have it, ladies and gentlemen, The Fraud.

Mesa Econoguy October 22, 2011 at 11:53 pm

Oh, so I see, Nikki Puddle, shall we “minimize” our usury in government-driven mortgage lending, or should we just loan shark it to everyone, f.o.b.


Mesa Econoguy October 23, 2011 at 2:17 am

No, debt is not money, plant.


Mesa Econoguy October 22, 2011 at 6:35 pm
Jim October 22, 2011 at 7:40 pm

Just read a comment on another website that explains the OWS, and which I hope Don and Russ will not mind me sharing.

“I thought the purpose of OWS was so disgruntled people could shit in the park.”

Enough said.

Dan Phillips October 22, 2011 at 9:45 pm

Ha! That’s a good one. Somewhere I saw a headline about the OWS crowd that read “Anarchists For Big Government.”

vikingvista October 23, 2011 at 11:56 am

Most self-described anarchists essentially are.

muirgeo October 22, 2011 at 8:29 pm

Tea Party = Crony capitalism with leaders being Crony Capitalist funding the very “movement” and the followers are uneducated creationist right wing religious extremist tools. They have little public support in mainstream America and are a laughing stock outside of this country.

OWS = a heterogeneous diverse group with a far better understanding of the real problems and real solutions. They enjoy broad based support here and overseas.

MWG October 22, 2011 at 8:34 pm

It feels so good to know that the governments of North Korea, Iran and ither despotic regimes stand in solidarity with those camping out in New York.

Mesa Econoguy October 22, 2011 at 11:26 pm

They enjoy broad based support here…”

From whom, precisely?

brotio October 23, 2011 at 1:21 am

In case you didn’t know it, TARP was passed by a Democrat-controlled congress. Among those who voted for it were noted socialist stalwarts Nancy Pelosi, Diana DeGette, Bawney Fwank, Sheila Jackson-Lee, Charles Rangel, and Debbie Wasserman-Schultz. All of these people are at least as regressive as you (although none are as profoundly stupid).

House Democrats voted 172 – 63 in favor of TARP; House Republicans voted 108 – 91 against TARP.

It is amusing that you waddled around Boston Common with a bunch of regressive stooges, protesting those who accepted a government handout, while remaining silent about the Democrats guilty of handing-out.

Greg Webb October 23, 2011 at 1:51 am

Georgie! I see that you continue to pretend at knowledge. The Tea Party is a peaceful political movement espousing smaller government. Its people did trash parks or crap on cop cars.

The OWS group are smelly, environmentally-disastrous, emotionally-needy, people who are demanding that government steal from the productive in order to give to the OWS group.

MWG October 22, 2011 at 8:32 pm

I prefere neither, but will admit that the TP movement is the lesser of the two evils.

Mesa Econoguy October 22, 2011 at 11:29 pm

Only 1 is evil, either indirectly, or directly so.

That’s unfortunate.

Mesa Econoguy October 23, 2011 at 3:43 am
Mesa Econoguy October 23, 2011 at 4:05 am

Eurosocialism is fine…..nothing to see here……
European Finance Ministers Driven To Despair As Reality Returns

The release of the Troika report (stating the what-we-all-know that is much larger haircuts will be needed for any type of debt sustainability) seemed to bring events this weekend in Europe to an early halt, according to SudDeutsche. As the sheer mathematical certainty of the event horizon that is Europe these days is slammed at light speed into the foreheads of the European cognoscenti, we finally see some actual frustration, foot-stomping, and ‘throw-your-teddy-bear-out-of-the-pram’-ness. The Telegraph reports on some choice turns-of-phrase among the leading players, our favorite being:
“It was grim. The worst mood I have ever seen, a complete mess,” said one eurozone finance minister.
But it only got better from there, with several of the major movers feeling the need to express their frustration (and what is German for Schadenfreude?) at the lunacy of what SudDeutsche reports was in the Troika debt sustainability report (via Google Translate).

The numbers that the Troika on Friday evening on the debt situation in Greece is presented, have altered the agenda of the Euro-Finance completely. Really wanted the department heads to advise [if] they need to convince the country’s private creditors to agree on a bigger discount on the bonds held by them, than the previously planned 21 percent.

But the “if” was suddenly a “how high?”. Because the inspectors of the Greek lender describe in their “debt sustainability report,” a scenario that far surpasses any fears. The country needs even under “normal” conditions, so if everything goes as planned with the reforming and saving, at least 252 billion euros , by 2020 to get back on its feet.

If the economy collapses further, state enterprises can not be privatized as hoped, nor do the reforms [produce the] € 444 billion needed to [please] the inspectors. So it is suddenly clear: the euro rescue fund EFSF is hardly sufficient for more countries to save, and his successor, the latest from 2013 operational ESM also not good.

“It is clear that a substantial debt cut is necessary,” however, said Swedish Finance Minister Anders Borg….
The Exchequer George Osborne sharply criticized the actions of the euro partners: “The crisis in the euro-zone causes major damage in many European economies, including Britain,” he shouted in Brussels, adding: “We have had enough of short-term measures, it enough, paving draufzukleben that bring us through the next few weeks. ” Europe must tackle the causes of the crisis. Used to be a comprehensive and lasting solution to the crisis, so that growth in Europe could begin rising again.

… The Luxembourg Foreign Minister Jean Asselborn announced immediately to resist. “What we need now is rest and no whip,” he said.
A stronger economic cooperation is also possible on the basis of existing treaties. “It is important that we do not open another front,” said Asselborn. “It can not be that domestic political considerations of even the greatest country outweigh everything.”

It was clear that the reality of the size of loan required to ‘solve’ Greece alone will likely leave the cupboard bare:
Jan Kees de Jager, the Dutch finance minister, told colleagues: “We’ve got to get real. People are talking about new defences but with one gulp the whole €440 billion could be gone, leaving the eurozone with no protection at all.”

According to insiders, Wolfgang Schaeuble, Germany’s finance minister, could not resist taking an “I told you so” approach – he had been, after all, the first to call for an “orderly” default for Greece 18 months ago, at a time when the cost of such a move was less than one third of the price today.

“Schaeuble is a man who does not mince his words, whose reputation for harshness and arrogance is well earned. He was, frankly, unbearable,” said one diplomat.

And Baroin (France) to IMF swiftly followed by Lagarde (France/IMF)’s slapdown:

Francois Baroin, the young and inexperienced French finance minister,
attempted to hit back, complaining that the IMF’s default medicine would hit
France the hardest; the country’s banks are highly exposed and could
threaten its “untouchable” AAA rating.

But Mrs Lagarde, who had held his post until taking up the IMF job this
summer, “shut him up” by brandishing the report and pointing to it
its detailed figures. “She really slapped him down – and in perfect
English too, a language he cannot speak,” said a diplomat.
We suspect many of the attendees (finance ministers) have not actually spoken to one another, read any serious research, or even attempted to comprehend the whole-versus-the-single sub-optimal decisions they face (until very recently) as their voluminous outbursts were incredible:
“Their shouting could be heard down the corridor in the concert hall where an orchestra was about to play the EU’s anthem, Ode to Joy,” said an incredulous EU official.
It did not stop there as the pointlessness of the meeting was highlighted as it became increasingly clear that the good old Franco-German comradeship may be fraying at the core and at the edges and without them.
Finance ministers – including George Osborne, the Chancellor – expressed frustration on Saturday that their emergency meeting could take no decisions of substance until Mrs Merkel and Mr Sarkozy had buried the hatchet.
“This Ecofin meeting has been reduced to an academic seminar, an exercise with absolutely no purpose,” complained one finance minister. complained one finance minister.

For those expecting any solution that is more than a simple kick-the-can hold-your-breath for the final solution, we suggest hedges asap on Sunday night as it is crystal clear that nothing of substance will be created soon and furthermore, we wonder whether this is some elaborate global game to force the Fed to rescue everyone by flooding it with greenbacks.

Methinks1776 October 23, 2011 at 9:59 am

There’s only one question to be answered in Europe.

To save a Euro unworthy of saving, will the German politicians be able to compel the German taxpayers to pay for the profligacy of the other members of the Euro or will the ECB debase the currency and take it out of everyone’s hide?

The ECB is understandably reluctant – particularly since inflation is already higher in the Eurozone than it is here. The politicians would like to force the ECB’s hand in the hope that they will be absolved of responsibility for the hell that follows.

Central planning is not only fun to watch, but also always has and always will lead to prosperity, right? This is what we’re told.

Mesa Econoguy October 23, 2011 at 4:13 am

Still think Eurosocialism is a good idea, Barack?

Babinich October 23, 2011 at 6:49 am

Sure he does…

Do you really think a leopard changes its spots? He’s all in. If anyone bothered to pay attention to this guy’s body of work you could have predicted his, and his administration’s actions right down to their stationary.

Martin Brock October 23, 2011 at 8:20 am

Choosing sides in a contest between TPers and OWSers is silly. It’s a false choice. “The Tea Party has a coherent message” is nonsense. The “Tea Party” began with Paulis, but it’s now a hodgepodge of factions with diverse agendas. Michele Bachmann is the anointed “Tea Party” representative according to talking heads in the most central media, and she’s a warmongering Left Behinder defending the military-industrial complex to the last man. Good thing she’s not a man.

Both groups are a hodgepodge of malcontents, and elements of both groups can make common cause against centralized authority. If you buy a contest between the two, you’ve only bought into the divide and conquer strategy of powers that be. As soon as you limit your options to one of two teams corresponding roughly to Republicans and Democrats, you’re playing a well established game of the central authorities.

muirgeo October 23, 2011 at 8:43 am

Good point for the most part but there really is a difference in the grassroots nature of the two movements wih the TP movement definitely having a lot of support and money from those powers that be.

James Hanley October 23, 2011 at 9:04 am

I think someone wise can only prefer either group by not paying very close attention to either of them.

Scott Murphy October 23, 2011 at 10:12 am

I just don’t buy that Fannie Mae and Freddie Mac caused the housing crisis. I think it was more that Wall Street creditors knew they would be bailed out if they made bad loans. I just don’t know which party is more likely to end this practice.

Methinks1776 October 23, 2011 at 10:19 pm

Freddie and Fannie alone were not enough to cause a crisis of this size. Exactly, precisely what caused this crisis and in what proportion will never be truly known. People will do studies and have opinions, but it will never be known.

There’s only one thing we can be sure of – government legislation, incentives and regulations distorted the market beyond hope. Market mechanisms stopped working and the whole thing started sliding off a cliff. It’s not as if this consequence of central planning is unknown. Which distortion was the one distortion too many?

Observer October 23, 2011 at 10:37 pm

True that, Methinks1776. But, Fannie Mae, under James Johnson, created the funding source that permitted the economic distortions to get way out of hand.

visitor1947 October 24, 2011 at 1:37 pm

Let’s call Occupy Wall Street the Green Tea Party.

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