Daily Digest

Daily Digest 3/22 - Italy Takes On Generation-Dividing Laws, Mike Maloney & Jim Rogers, Obama Prepares For War Footing

Thursday, March 22, 2012, 10:27 AM
  • Sweden Moving Toward Cashless Economy
  • They Made Main Street Their Own: How Four Women Revived a Derelict Mississippi Town
  • Stuck in Recession, Italy Takes on Labor Laws That Divide the Generations
  • Muppets 1, Gollums 0
  • Analysis: The AIJ Scandal And Japan's Pension Time Bomb
  • London Trader - Sovereign Gold Buyers to Raise Their Bids
  • How One Man Escaped From A North Korean Prison Camp
  • Mike Maloney & Jim Rogers
  • Antal Fekete Responds To Ben Bernanke On The Gold Standard
  • Barack Obama Prepares for War Footing
  • Startup Converts Plastic To Oil, And Finds A Niche
  • Things That Make You Go Hmmm - Such As $4.00 Gas (Again)

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Economy

Sweden Moving Toward Cashless Economy (June C.)

Bills and coins represent only 3 percent of Sweden's economy, compared to an average of 9 percent in the eurozone and 7 percent in the U.S., according to the Bank for International Settlements, an umbrella organization for the world's central banks.

Three percent is still too much if you ask Ulvaeus. A cashless society may seem like an odd cause for someone who made a fortune on "Money, Money, Money" and other ABBA hits, but for Ulvaeus it's a matter of security.

They Made Main Street Their Own: How Four Women Revived a Derelict Mississippi Town (Dagny)

Coulter Fussell, 34, an artist and an owner of Yalo Studio, a gallery a couple of doors down the block on the town’s Main Street, favors a crowbar. Megan Patton, also 34, an artist, waitress and Ms. Fussell’s gallery partner, likes to use a hammer and a screwdriver. Erin Austen Abbott, 36, a photographer, gift shop owner, pop-up gallery impresario and travel nanny, doesn’t care what tool she uses, as long as she has company.

Stuck in Recession, Italy Takes on Labor Laws That Divide the Generations (John M.)

The Linza family is emblematic of a yawning generational divide that experts say is crippling the Italian labor market. While older workers came of age with guaranteed jobs and ironclad contracts granting generous pensions and full benefits, younger Italians — the best-educated in the country’s history — are now paying the price. They are lucky to find temporary work, which offers few benefits or stability.

Muppets 1, Gollums 0 (June C.)

I have no problem with the staff of Goldman Sachs earning millions. I have no problem with their 16-hour work days (or the fact that they seem to turn many of their number into Gollum-like bald freaks well before their time). I have no problem with their clannish, hubristic, insular culture, having never wanted to work for the Moonies. My main problem with Goldman Sachs is that if it operated like any other business in the world, when it and its business model effectively failed in 2008 it should have been allowed to fail properly, and closed down. But that is not what happened.

Analysis: The AIJ Scandal And Japan's Pension Time Bomb (June C.)

"We've been in the red every year since 2007. The additional funds needed for this pension installment is killing our business. I've sold everything from stocks to golf memberships to keep us afloat," said Nagata, sitting on a torn sofa on the second floor of the old wooden building that has served as company headquarters for half a century.

"I'm talking with banks now in preparation to make the repayment by the end of August. But if I can't then we'll be in serious trouble."

London Trader - Sovereign Gold Buyers to Raise Their Bids (June C.)

The Iranians are claiming the West saying Iran’s nuclear program is a threat is all nonsense. It’s merely an excuse because the US will threaten and attempt to take down any country which threatens the reserve currency status of the dollar -- the same way the US took down Saddam Hussein and Moammar Gadhafi.

How One Man Escaped From A North Korean Prison Camp (Chris M.)

If Shin's mother met her daily work quota, she could bring home food. At 4am, she would prepare breakfast and lunch for her son and for herself. Every meal was the same: corn porridge, pickled cabbage and cabbage soup. Shin was always hungry and he would eat his lunch as soon as his mother left for work. He also ate her lunch. When she came back from the fields at midday and found nothing to eat, she would beat him with a shovel.

Mike Maloney & Jim Rogers (adam)

Today all Gold and Silver Weekly subscribers will be receiving the latest insights of Mike Maloney as he chats with Jim Rogers about markets, Bernanke, the East/West Cycle and more.

Antal Fekete Responds To Ben Bernanke On The Gold Standard (June C.)

Mises fails to answer his own question why gold is the best choice to serve as money. Indeed, why not another commodity, or a basket of commodities? The reason is that the marginal utility of gold is unique in that it declines at a rate slower than that of any other substance on Earth. Various assets have various marginal utilities which determine their value. All of them decline, albeit at various rates. In other words, economic actors accumulate assets increasingly reluctantly, up to their satiation point that will be reached sooner or later. For gold, this point is removed farther, so far indeed that for all practical purposes it is beyond reach.

Barack Obama Prepares for War Footing(Sandy S.)

If Iran was struck by Israel or the West, or if Iran thought it might be struck, the Tehran regime has promised it would block the Strait of Hormuz, which would obstruct some 40 percent of the world's seaborne oil, some twenty percent of the global supply, and about 20 percent of America's daily needs. Moreover, Tehran has promised military retaliation against any nation it feels has harmed it. The United States is at the top of the list.

Energy

Startup Converts Plastic To Oil, And Finds A Niche (dave)

It all starts with a machine known as the Plastic-Eating Monster. Thousands of pounds of shredded milk jugs, water bottles and grocery bags tumble into a large tank, where they're melted together and vaporized. This waste comes from landfills and dumps from all over the United States.

"Basically, they've been mining their piles for us and sending them here," says John Bordynuik, who heads his namesake company, JBI Inc. He invented a process that converts plastic into oil by rearranging its hydrocarbon chains.

Things That Make You Go Hmmm - Such As $4.00 Gas (Again) (Chris M.)

comparison of the oil price forecasts from various oil producers reveals that, in the period of 1999 to 2010 Mexico, Saudi Arabia, and Russia made the most accurate forecasts. All three of them also came closest to the actual price last year, which is why it makes sense to listen to their expectations. For 2012 they predict substantially higher oil prices. Saudi Arabia expects an average WTI price of USD 97, Mexico forecasts USD 116, and Russia USD 120/barrel. Iran has given the highest forecast at USD 137/barrel.

Article suggestions for the Daily Digest can be sent to dd@PeakProsperity.com. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."

25 Comments

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Public Opinion Poll on Energy Shows The Public Is Clueless

http://billhicksisdead.blogspot.com/2012/03/public-opinion-poll-on-energy-issues.html

Excerpt from the article:

Support for development of fuel sources such as wind and solar power has diminished in the United States during the past year, a survey found.
 
The March 7-11 poll, conducted by the Pew Research Center for People & the Press, found 52 percent of those responding indicated support for alternative fuel was more important than increasing oil, coal and natural gas production, while 39 percent indicated expanding exploration of coal, oil and gas was the more important of the two choices.
 
Although a majority went for alternative fuels, support for solar, wind and hydrogen power was not as popular as it had been in March 2011, when 63 percent indicated that was their favorite choice, while 29 percent chose coal, oil and gas exploration.
 
Respondents who identified themselves as Republicans were more apt to have changed their preferences -- with 33 percent indicated support for alternative energy sources, down from 47 percent in 2011.

And my reaction:

Do I really need to waste the pixels pointing out that asking people whether they “support” development of alternative energy versus whether they “support” increased oil, coal and natural gas production is laughably meaningless? The question makes it sound as if all forms of energy are interchangeable and unlimited, and how we power our lives is merely a matter of the choices we collectively make. 


Doug's picture
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Bill Hicks

Bill Hicks wrote:

http://billhicksisdead.blogspot.com/2012/03/public-opinion-poll-on-energy-issues.html

Excerpt from the article:

Support for development of fuel sources such as wind and solar power has diminished in the United States during the past year, a survey found.
 
The March 7-11 poll, conducted by the Pew Research Center for People & the Press, found 52 percent of those responding indicated support for alternative fuel was more important than increasing oil, coal and natural gas production, while 39 percent indicated expanding exploration of coal, oil and gas was the more important of the two choices.
 
Although a majority went for alternative fuels, support for solar, wind and hydrogen power was not as popular as it had been in March 2011, when 63 percent indicated that was their favorite choice, while 29 percent chose coal, oil and gas exploration.
 
Respondents who identified themselves as Republicans were more apt to have changed their preferences -- with 33 percent indicated support for alternative energy sources, down from 47 percent in 2011.

And my reaction:

Do I really need to waste the pixels pointing out that asking people whether they “support” development of alternative energy versus whether they “support” increased oil, coal and natural gas production is laughably meaningless? The question makes it sound as if all forms of energy are interchangeable and unlimited, and how we power our lives is merely a matter of the choices we collectively make. 


+++++++1

A Hobson's choice like many being used to gull us into the belief that there is a way out of our many predicaments.  The only real choices are whether to be aware and take the road less travelled.

Doug

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Barack Obama Prepares for War Footing

I would like to add something to this conversation.

Marine charged for criticizing Obama

http://rt.com/usa/news/marine-stein-page-president-219/

This is an interesting article and it brings up this question.

The Oath of Enlistment in the United States Military

“I, ________________, do solemnly swear (or affirm) that I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; and that I will obey the orders of the President of the United States and the orders of the officers appointed over me, according to regulations and the Uniform Code of Military Justice. So help me God.”

This is the oath taken by anyone entering the armed services. For a while I have wondered about why this erosion in are civil liberties are taking place at this particular time. There are many answers but the above article got me thinking about this.

"...I will obey the orders of the President of the United States and the orders of the officers appointed over me, according to regulations and the Uniform Code of Military Justice. So help me God."

This hinges on the fact that no service person has to obey an "unlawful" order. However, if it is "lawful" to detain US citizens indefinitley, or lawfully remove your right to Habeus Corpus or the 4th amendment then military personel must obey.

Is this simply another chess piece being moved into place?

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The Secret Millionaires Club

Well, apparently Uncle Warren is hosting a children's online TV program that teaches them how to grow up to be [fill in the blank]. Yep, folks, it's the "Secret Millionaires Club." (For whatever reason, this progam just hit a nerve and was the final straw for me. I give up and I no longer care what this country is or will become.)   http://www.smckids.com/

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Johnny Oxygen wrote: I would

Johnny Oxygen wrote:

I would like to add something to this conversation.

Marine charged for criticizing Obama

http://rt.com/usa/news/marine-stein-page-president-219/

This is an interesting article and it brings up this question.

The Oath of Enlistment in the United States Military

“I, ________________, do solemnly swear (or affirm) that I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; and that I will obey the orders of the President of the United States and the orders of the officers appointed over me, according to regulations and the Uniform Code of Military Justice. So help me God.”

This is the oath taken by anyone entering the armed services. For a while I have wondered about why this erosion in are civil liberties are taking place at this particular time. There are many answers but the above article got me thinking about this.

"...I will obey the orders of the President of the United States and the orders of the officers appointed over me, according to regulations and the Uniform Code of Military Justice. So help me God."

This hinges on the fact that no service person has to obey an "unlawful" order. However, if it is "lawful" to detain US citizens indefinitley, or lawfully remove your right to Habeus Corpus or the 4th amendment then military personel must obey.

Is this simply another chess piece being moved into place?

JOx -

You have correctly cited the Oath Enlisted men and women take.  The Officer's Oath is slightly different in wording, significantly different in context and potential address of your concerns.

“I, [name], do solemnly swear (or affirm) that I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; that I take this obligation freely, without any mental reservation or purpose of evasion; and that I will well and faithfully discharge the duties of the office on which I am about to enter. So help me God."

The difference is enormous and whenever I swore in a newly commissioned officer or an officer being promoted, I would always discuss the difference in the Officer's and the Enlisted oaths.  Specifically, that officer's are charged with understanding that their obligation lies to supprort and defense of the Constitution and the country who's course it directs.  More importantly, it doesn't stop short of clearly delineating the obligation that commissioned officers in the service of the United States are bound by this oath to DISOBEY ANY order that violates the Constitution of the United States.

As a side note, I still maintain that the NDAA was just an extraordinarily poorly written document.  (Does a double split infinitive cancel itself out??? )

Not surprising given the jackwagons that wrote it. 

You can take some comfort in knowing that nearly all of my peers and colleagues that I have spoken with on this subject who are either still serving on active duty or are retired clearly understand what NDAA DOES NOT allow...........

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Plastic 2 Oil

This is a tough one. On the one hand, there's a LOT of plastic in landfills, floating in the oceans, stored here and there. Very little is recyclable. And industry just keeps cranking out more. So, why not try to put some of this stuff to use?

For starters, converting it to fuel sounds good on the surface. But, if we follow the carbon we realize that all that sequestered carbon now leaves the land fills, etc., and ends up in the atmosphere for a couple of centuries. It works out to be just a delay in burning oil. As oil production peaks and rolls over, what we're looking at is an extension in using some fraction of production a second time as fuel. Fundamentally, this technology is as limited as oil itself.

But understanding fundamentals is not what our economy is about. It's about extracting value from labor and resources. In our schizophrenic desire to burn more oil and yet curb greenhouse gasses the only thing that rings true is the desire for profit. In that respect, Plastic 2 Oil makes sense. Ten or twenty dollars of processing of waste gets you $100 worth of fuel and the atmosphere gets a new source of carbon.

There’s probably a several decades worth of plastic waste available to be turned into fuel. My guess is if this process gets off the ground there will be a significant lag between the depletion of the stock of plastic before the conversion process starts to feel the pinch from diminishing oil production. One might expect that as the price of oil ratchets upward, the uses of oil will have a longer useful life thus slowing the transition from artifact to waste. Even vultures suffer if the drought persists long enough.

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Oathkeepers

There is an organisation.
Their website. http://oathkeepers.org/oath/

Oath Keepers is a non-partisan association of currently serving military, veterans, peace officers, and firefighters who will fulfill the oath we swore to support and defend the Constitution against all enemies, foreign and domestic, so help us God.

Our oath is to the Constitution, not to the politicians, and we will not obey unconstitutional (and thus illegal) and immoral orders, such as orders to disarm the American people or to place them under martial law and deprive them of their ancient right to jury trial.

We Oath Keepers have drawn a line in the sand. We will not “just follow orders.”

Our motto is “Not on our watch!”

If you, the American people, are forced to once again fight for your liberty in another American Revolution, you will not be alone. We will stand with you.

There is at this time a debate within the ranks of the military regarding their oath. Some mistakenly believe they must follow any order the President issues. But you can rest assured that many others in the military do understand that their loyalty is to the Constitution, and understand what that means.

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Constitution

As I recall, correct me if I'm wrong on the specifics, the notion of disobeying a direct order came about in the wake of the MyLai massacre.  In that context, there is a bright line.  There should have always been one.  You don't line up and slaughter innocents.  If you're in that situation and you're in the military, you know your duty.

OTOH, at some point short of that, I don't think its appropriate for officers or enlisted to suddenly take on the role of Constitutional scholars and parse the language of various laws, even the UCMJ, and decide what's appropriate or not in that light.  If there's a doubt, I would advise following orders until such time as the scholars figure it out, or risk the consequences.  And, you as a service member should never be in a position where it comes up.  If you have a problem with that, then don't take the oath or, if you already have, get out after your enlistment expires or resign if you're an officer.  

To suddenly have a military where people decide which orders they're going to follow invites chaos.  Perhaps you should consult a lawyer before you sign on the dotted line to find out where the line is, and if you object, do something else with your life.  We don't have a draft.  And, if they reinstitute a draft, become a CO.

The bottom line is, in all but the most egregious of circumstances, you follow orders.

Doug

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Doug wrote:  As I recall,

Doug wrote:

As I recall, correct me if I'm wrong on the specifics, the notion of disobeying a direct order came about in the wake of the MyLai massacre.  In that context, there is a bright line.  There should have always been one.  You don't line up and slaughter innocents.  If you're in that situation and you're in the military, you know your duty.

OTOH, at some point short of that, I don't think its appropriate for officers or enlisted to suddenly take on the role of Constitutional scholars and parse the language of various laws, even the UCMJ, and decide what's appropriate or not in that light.  If there's a doubt, I would advise following orders until such time as the scholars figure it out, or risk the consequences.  And, you as a service member should never be in a position where it comes up.  If you have a problem with that, then don't take the oath or, if you already have, get out after your enlistment expires or resign if you're an officer.  

To suddenly have a military where people decide which orders they're going to follow invites chaos.  Perhaps you should consult a lawyer before you sign on the dotted line to find out where the line is, and if you object, do something else with your life.  We don't have a draft.  And, if they reinstitute a draft, become a CO.

The bottom line is, in all but the most egregious of circumstances, you follow orders.

Doug

Doug -

I'm not sure if you have ever served but you are 100% incorrect.  Not only is it appropriate, it is specifically required by our Oath to question "questionable" orders.  Fortunately, on a day to day basis, in the vast majority - 99.5% - of situations, issuing and following orders is mudane and routine and simply gets the job done - whether the job is a 6 hour watch as Officer of the Deck driving a submarine through the ocean, or piloting a KC-135 during an aerial refueling, shooting Hornets off the deck of a carrier or any number of every day duties.  Nobody is going to sit and ponder the Consitutionality of an order to shut the main steam valves when there is a steam line rupture in the engine room of a submarine.

It is however, imperative upon every commissioned officer, NCO and service member to recognize and question things when they are getting into that .5%.

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Thanks Dogs

Thanks for the info.

I appreciate the response.

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Amen to Dogs

Dogs_In_A_Pile wrote:

Doug wrote:

As I recall, correct me if I'm wrong on the specifics, the notion of disobeying a direct order came about in the wake of the MyLai massacre.  In that context, there is a bright line.  There should have always been one.  You don't line up and slaughter innocents.  If you're in that situation and you're in the military, you know your duty.

OTOH, at some point short of that, I don't think its appropriate for officers or enlisted to suddenly take on the role of Constitutional scholars and parse the language of various laws, even the UCMJ, and decide what's appropriate or not in that light.  If there's a doubt, I would advise following orders until such time as the scholars figure it out, or risk the consequences.  And, you as a service member should never be in a position where it comes up.  If you have a problem with that, then don't take the oath or, if you already have, get out after your enlistment expires or resign if you're an officer.  

To suddenly have a military where people decide which orders they're going to follow invites chaos.  Perhaps you should consult a lawyer before you sign on the dotted line to find out where the line is, and if you object, do something else with your life.  We don't have a draft.  And, if they reinstitute a draft, become a CO.

The bottom line is, in all but the most egregious of circumstances, you follow orders.

Doug

Doug -

I'm not sure if you have ever served but you are 100% incorrect.  Not only is it appropriate, it is specifically required by our Oath to question "questionable" orders.  Fortunately, on a day to day basis, in the vast majority - 99.5% - of situations, issuing and following orders is mudane and routine and simply gets the job done - whether the job is a 6 hour watch as Officer of the Deck driving a submarine through the ocean, or piloting a KC-135 during an aerial refueling, shooting Hornets off the deck of a carrier or any number of every day duties.  Nobody is going to sit and ponder the Consitutionality of an order to shut the main steam valves when there is a steam line rupture in the engine room of a submarine.

It is however, imperative upon every commissioned officer, NCO and service member to recognize and question things when they are getting into that .5%.

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Gold standard is a gimmick

“the gold standard did not fail: governments deliberately sabotaged it, and still go on sabotaging it” ... Ludwig v. Mises, quoted by Antal Fekete, linked by June C. (who, BTW,  is wonderful at providing CM with great sources).

About governments sabotaging the gold standard, let's note also that no fiat money has ever failed except that governments deliberately sabotage fiat currencies, and go on sabotaging them. No fiat currency would ever have failed except that governments deliberately sabotaged it.

The gold standard is a gimmick, promising everything with just one simple little reform. Marx, too, presented one simple reform, essentially a gimmick .... and the end result was the most disastrous concentration of power in the history of the world.

Fekete's argument confuses the two opposing roles of "money" -- namely, store of value and medium of exchange. These two must meet somewhere in the middle, and that's called "measure of worth." But the truth is that money in the sense of currency or medium of exchange need not be an eternal store of value -- and if we try to make money into such a thing, we destroy the economy. On the other hand, currency must be able to function as a measure of worth. If that function fails, that too destroys the economy.

The either/or approach to the question of the gold standard is ridiculous. Fekete provides us with a great summary of the history and analysis of many faulty theories and failed policies, but none of Fekete's criticism leads to the conclusion that the gold standard is a solution or the solution to anything ... unless we can accept the premise that there are only two choices: a rigid gold standard or absolute fiat. That premise is equivalent to that we must either accept Bernanke or von Mises, as though our abiilty to think terminated with those two voices.

The problem is that the gold standard requires the same probity that must underlie any monetary system. Just because someone says there is gold behind whatever the currency may be ... what does that prove?  Economies have been there and done that, many times over, collapsing with some regularity. The same forces that conspire to destroy a fiat currency can (and surely would) conspire to destroy what would still be an essentially fiat currency, even if supposedly based on a gold standard.

Furthermore, Fekete's points on the Constitution are incomplete and misleading. You may or may not like the realities of the Constitution, but it is what it is.

Like it or not, the country began with fiat money as well as with Spanish coin. The limitation not to make "any Thing but gold and silver Coin a Tender in Payment of Debts" is part of Section 10, titled "Powers prohibited of States" -- and has never been applied to the Federal government as a Constitutional limitation on the powers of Congress. There is no limitation respecting money creation in Section 9, which is titled "Limits on Congress." There''s also Section 8 --

"Congress shall have Power ....
To borrow money on the credit of the United States;  ..... [and]
To coin Money, regulate the Value thereof, and of foreign Coin."

Congress can coin money in any way it sees fit. Congress has the Constitutional authority to coin money in any metal it may choose (e.g., aluminum). And, just as with the Silver Certificates so common just 60 years ago, Congress can authorize Treasury to issue certificates representing coinage. Furthermore, Congress has the Constitutional authority to regulate the value of coin (and, by reference, the value of all certificates and therefore of all electronic credits). Furthermore, Congress has the power to peg the dollar to any foreign currency, as it may deem expedient.

Having said that, I hasten to add that I do not support continuing the Federal Reserve system (at least not in its present form). I do think that the basket of commodities approach is solid ... and probably the wave of the future. Gold is a great store of value, but the "gold standard" is a hoax and a pernicious delusional system.

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ah for $4 gas......

Petrol (gasoline) has now hit $1.59/L, or $5.75/Gallon in Australia....

Mike

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Spoonfed by my superiors.

I like to vet who feeds my brain and Antil E Fekete has my attention. Zerohedge.

Antal E. Fekete, Professor of Mathematics and Statistics,

Wiki

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Constitution

I can attest to military officers understanding their responsibility to the Constitution.  My Commanding Officers have always made it clear to all the Officers that our duty as first and foremost to the Constitution.  In fact, we were all given pocket-sized Constitutions and encouraged to carry them at all times and refer to them regularly.  However, in my 10 years in the Navy, I've never seen a violation of the Constituion.  I have seen some questionable orders (not unconstitutional, but unlawful), and they were questioned in the appropriate manner and retracted.  There was never any chaos associated with the possible unlawfulness of an order.  In fact, disobeying a lawful order in wartime is punishable by death under the Uniform Code of Military Justice, so one would want to make darn sure they are right before questioning orders!  

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Declared War and UCMJ

jamster777 wrote:

I can attest to military officers understanding their responsibility to the Constitution.  My Commanding Officers have always made it clear to all the Officers that our duty as first and foremost to the Constitution.  In fact, we were all given pocket-sized Constitutions and encouraged to carry them at all times and refer to them regularly.  However, in my 10 years in the Navy, I've never seen a violation of the Constituion.  I have seen some questionable orders (not unconstitutional, but unlawful), and they were questioned in the appropriate manner and retracted.  There was never any chaos associated with the possible unlawfulness of an order.  In fact, disobeying a lawful order in wartime is punishable by death under the Uniform Code of Military Justice, so one would want to make darn sure they are right before questioning orders!  

Hmmm - I wonder how this can be intrepreted since no war has really be declared (by congress) since WWII.

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Greee going cashless?

http://www.guardian.co.uk/world/2012/mar/16/greece-on-breadline-cashless-currency
 

In recent weeks, Theodoros Mavridis has bought fresh eggs, tsipourou (the local brandy: beware), fruit, olives, olive oil, jam, and soap. He has also had some legal advice, and enjoyed the services of an accountant to help fill in his tax return.

None of it has cost him a euro, because he had previously done a spot of electrical work – repairing a TV, sorting out a dodgy light – for some of the 800-odd members of a fast-growing exchange network in the port town of Volos, midway between Athens and Thessaloniki.

In return for his expert labour, Mavridis received a number of Local Alternative Units (known as tems in Greek) in his online network account. In return for the eggs, olive oil, tax advice and the rest, he transferred tems into other people's accounts.

"It's an easier, more direct way of exchanging goods and services," said Bernhardt Koppold, a German-born homeopathist and acupuncturist in Volos who is an active member of the network. "It's also a way of showing practical solidarity – of building relationships."

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The Astonishing Causes of Inflation.

From Professor Antil Fekete

A large part of outstanding real bills in circulation represented the wage fund of society. Out of this fund wages for labor producing merchandise that will not be available for sale for up to 91 days could be paid now. Thus real bills represented a real extension of demand for labor. Employers would simply go ahead and hire all the hands needed to produce merchandise in high consumer demand, without worrying who will advance the funds to pay wages before the merchandise could be sold. The wage fund would always be there. The RBD explains why there was no ‘structural unemployment’ in the 19th century, in contrast with the 20th when the wage fund was destroyed never to be rebuilt. 19th century entrepreneurs did not have to assume the burden of financing the payment of wages.

My bold.

Ok. So we have got dumber since the 19th Century. I am not astonished. Someone should teach the 1% ers all about Noblesse Oblige.

The Oxford English Dictionary says that the term "suggests noble ancestry constrains to honorable behavior; privilege entails to responsibility". Being a noble meant that one had responsibilities to lead, manage and so on. One was not to simply spend one's time in idle pursuits.

wiki.

Curiosity about RBD (Real Bills Doctrine) lead me to this excellent summary of the competing models of economics and consequently the causes of inflation.

It is not certain that the Quantity of Money (Printing) is the only source of inflation.

I find this astonishing. Luckily I am aware that Models of reality are only as good as their utility. I hold none dear to my heart.

Doug's picture
Doug
Status: Diamond Member (Online)
Joined: Oct 1 2008
Posts: 2754
Dogs, Jamster

I wonder whether the kind of training you have received isn't a product of post-MyLai consciousness.  I was an NCO in the Navy before and after MyLai and there was never a mention of Constitutional responsibilities in any official communication I was aware of.

But, the bottom line situation is a battlefield where lives are saved or lost based on whether orders are followed immediately and without question.

Doug

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2OLD4OKEYDOKE
Status: Bronze Member (Offline)
Joined: Mar 28 2011
Posts: 72
Thanks to Arthur Robey

Thanks to Arthur Robey for comments on and quotes from Prof. Fekete, indicating Fekete's unique contributions to monetary theory. Nonetheless, I humbly dissent from Prof. Fekete on two points:

"If you substituted another commodity, or basket of commodities for gold, then you would end up with a unit of value the marginal utility of which was inferior  ....   It would be akin to substituting a yardstick made of rubber for one made of metal." (Fekete)

I suggest that Fekete is resorting to hyperbole when he finds that metals other than gold somehow become rubber when used as a monetary standard. I do not buy that gold is somehow magically "unique" respecting marginal utility. His argument at that point turns to mush. Scientifically speaking, every element is unique -- chemically, industrially and economically. And so what? It's pseudo-religious crap, regardless of the initials that follow Fekete's name.

Fekete's great contention is that Real Bills and a gold standard are entirely compatible so that there is no necessary tension between medium of exchange and store of value -- if only governments and economies and peoples would all conform to Fekete's theories. Supposing that such is the case, however, his theories fail to justify his criticiam of the basket of commodities approach -- his insistence on gold as the one and only. That's the Achilles heel of Fekete's position. That's where he slips (as all economists ultimately do) from the sublime of science to the mundane of rhetoric and politics.

What is truly telling of Fekete is when he inaccurately cites to the U.S. Constitution. To summarize, as Fekete does, the monetary provisions of the Constitution as defining money in terms of gold and silver is a distortion of Art. II.

I agree with Fekete that we must at this time in our history preserve and uphold the U.S. Constitution, but Fekete, if he has seriously read the U.S. Constitution, deliberately distorts what Article II plainly states. The definition of money in terms of gold and silver (Sect. 10, "Powers Prohibited of the States") was clearly never applied, or meant to be applied, to Section 8 ("Powers of Congress") -- and cannot be found within Section 9 ("Limits on Congress"). I support Amend. X and look forward to a SCOTUS decision limiting the Commerce Clause, but what Fekete does is, in effect, to stand the Tenth Amendment on its head, just as much as the many decisions enlarging the scope of the Commerce Clause since 1935. Two wrongs do not make a right.

I understand that Fekete was born in Hungary and may be a Canadian citizen, but I do not find that Fekete's views can be found anywhere in the Canadian Constitution. Perhaps he completely misunderstands the U.S. system and misses the distinction between limits on the States and limits on Congress?

Fekete may not like what Art. II plainly says, but distorting it is anything but supporting and upholding the U.S. Constitution, from the point of view of a citizen of the USA.

BTW: There is no doubt that Fekete is a brilliant mathematician and has made many contributions to the study of economics.

 

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