• Obama signed a $1.1 trillion spending bill
• The House approved a $155 billion jobs bill: I guess the stimulus package wasn’t enough to create jobs, so spend yourself further into debt, it’s the American way!
• The House raised the debt ceiling by $290 billion to finance six more weeks of spending: A $12.1 trillion debt limit, really, how quaint! And $290 billion over six weeks? C’mon Big Daddy-O, that’s not an allowance, it’s a pittance!

Well, that’s $1.1 trillion spent, with another $445 billion, in just one day. Does anyone even notice anymore?

• Pelosi hasn’t even done a full year’s work, and she’s already in campaign mode: Has she ever left it in her political life?
• The Senate Banking Committee rubber-stamped Ben Bernanke for another term: What intelligent statesman that committee has! Apparently, 16-to-7 is “an unusual amount of opposition from lawmakers who are disgruntled over the Fed’s bailout of financial firms.”
• Obama, Medvedev may get arms deal “in principle”: Yes, Reuters actually ran the story with exactly that headline. I guess an arms deal “in principle” is supposed to be meaningful, but does a deal “in principle” lower nuclear stockpiles “in reality”? No, I didn’t think so.

Apparently, spending ridiculous amounts of money is the only thing that can be performed with any efficiency or effect there.

The Republican base is now made up of religious and neoconservative ideologues, and the uneducated white underclass with a token person of color or two up front on TV to obscure the all-white, all reactionary all backward — there-is-no-global-warming — rube reality. Actual conservatives, let alone the educated classes, have long since fled.

While I somewhat agree on what he says about the Republican base, I don’t consider myself part of that base – however, I do hold the “rube reality” view about global-warming…that is, I question, among other things, the accuracy of the data provided to the public by politicians and politically-motivated “scientists.” But, like most collectivists (who are usually the true reactionaries, compared to real liberals, in the original Enlightenment-age sense of the word), it’s easier for Mr. Schaeffer to lump everyone he disagrees with into one single group, and then pillory them for their ignorance.

I’ve questioned the science and methods of the so-called “consensus” for years. I won’t get into the details, this article covers most of them fairly well. Suffice to say, that I’ve been told I’m a conspiracy theorist when I discuss their lack of using the scientific method or any peer review outside of governmental bodies being funded to prove a pre-decided agenda.

“In so far as a scientific statement speaks about reality, it must be falsifiable; and in so far as it is not falsifiable, it does not speak about reality.” – Karl Popper

I’ve also been told that as I’m not an “expert,” I’m not allowed to hold my own opinion as it differs from the “consensus.”

Well, that’s changed with the leak of these emails and, more importantly, source code files from the Climate Research Unit. I haven’t really paid much attention until very recently, because a) the main stream media is doing their usual job of propagandizing instead of reporting the news, and b) none of it’s a big surprise to me – not when Al Gore claims science proves this and that, then claims the “debate is over” and that any remaining debate has been purchased by Big Oil. Well, I’m not owned by Big Oil, but Al Gore is heavily invested in ethanol and has pushed it quite hard, even though ethanol has a larger carbon footprint, is far less efficient, and as a result, causes more pollution then oil. In addition, the climate change advocates have increasingly equated skeptics and deniers of their theories to Holocaust deniers. That’s not science, it’s a moral crusade thinly disguising a lust for power.

Yet, this leak has given plenty of evidence that I can claim to review as an expert! I’ve been programming since grade school, and have done it professionally for over 20 years – if that doesn’t make someone an expert, nothing else will – well, except for being funded by governmental agencies, which we all know are always morally superior to big business interests (that’s why they always have the force of States behind their agendas, right?!?). The articles here, here, and here, review the code at the bottom of this article. As the author of the second two articles points out, this doesn’t prove anything about global warming one way or the other. What it does prove is that the data was tampered with in a way that makes the conclusions drawn inaccurate. The conclusions of the IPCC (a political body, not a scientific one) are clearly skewed, and much peer review is needed to determine the true situation with our climate. Are the changes being claimed valid? If they are valid, are they significant enough to cause concern in the highly-dynamic, always changing, never static system our climate is? And if so, are the causes really anthropogenic in nature? As certain as the world’s political elites have become about this, I can’t imagine why they would have any issues with opening this up to public scrutiny and peer review.

However, they are reacting exactly as one would expect them to if they had something to hide. In this BBC article, for example:

In a statement, Professor Thomas Stocker and Professor Qin Dahe, co-chairmen of the IPCC’s working group 1, condemned the act of posting the private e-mails on the internet, but avoided commenting on their content.

Why wouldn’t you comment on the content if you’re so dead-certain of your theories? And why do you condemn an act that provides information to the world’s public that you would prefer hidden? Do you have something against democratic institutions? Furthermore,

Professor Jean-Pascal van Ypersele, vice-chairman of the IPCC, said it was no coincidence the information was released in the run-up to the summit.

He claimed unnamed conspirators could have paid for Russian hackers to break into the university computers to steal the e-mails.

He said the theft was a scandal and was “probably ordered” to disrupt the confidence negotiators have in the science.

Name the conspirators, or hush up, you tinfoil-hat-wearing conspiracy theorist. Besides, I will give very favorable odds that the hack was an inside job – espionage like this almost always is. Have I mentioned that data-, network-, and system- security is one of my specialties?

John Mitchell, head of climate science at the Met Office, said the evidence for man-made global warming was overwhelming – and the data would show that.

“So this is not an issue of whether we are confident or not in the figures for the trend in global warming, it’s more about being open and transparent,” he told the BBC.

Open and transparent means only sharing this data after you’ve been embarrassed by hackers, does it?

In another BBC article:

“Despite the best efforts of the sceptics [sic], there is no instance in these e-mails that anyone has found so far – and there are millions of people looking – that suggests the scientists manipulated their fundamental data,” Professor Watson, from the university’s School of Environmental Sciences, stated.

…Professor Watson added: “The climate sceptics would have us believe the e-mails invalidate the CRU data set, but they don’t.”

I’m not so sure about the e-mails, but the code certainly does suggest the data was manipulated, and therefore does invalidate the conclusions drawn from you nitwits by the CRU data set. And while you’re all playing CYA instead of scientist, the following views gain more prominence daily:

Saudi Arabia’s lead climate negotiator told BBC News that the e-mail row will have a “huge impact” on next week’s UN climate summit in Copenhagen.
Mohammad Al-Sabban said that he expected it to derail the single biggest objective of the summit – to agree limitations on greenhouse gas emissions.
“It appears from the details of the scandal that there is no relationship whatsoever between human activities and climate change,” he suggested.

I don’t understand how a scandal can prove or disprove a scientific theory, but I do understand the danger of mixing politics and science. Here we have a possibly worthy cause that’s in danger of being permanently associated with the quacks who hijacked it for their own selfish political, business, and socio-economic agenda.

The NAZI’s did this with their archaeological research to bolster their claims of racial superiority and to justify, in their minds at least, the Final Solution. If the climate bureaucrats insist on playing politics like usual, instead of making their case with sound science for once, then pollution will continue to become a more pressing issue – regardless of whether it’s causing climate change or not – because climate science will lose all credibility and be lumped in with NAZI archaeology as pseudoscience. As it should be, since many of the same methods are being used! For example, this damning document says, among other things:

If the best science is to lead to the best policy, then science people have to be mixed with policy people.

Were the NAZI and Soviet science programs really so successful that we should follow their example?

In the meantime, it’s business as usual for the world’s elites (who will use seven times the global-warming gases at Copenhagen as the rest of us during the same time period, while enjoying their free hookers there)  and bureaucracies (as the EPA prepares to label carbon dioxide – the gas we all send into the air every time we exhale – dangerous).

But enough of my appeals to authority. There will be no information-hiding here! Here is the code I’ve seen posted, reviewed, and looked at myself. If you’re a programmer, check it out for yourself. If you’re not a programmer, find someone who is and have them look. At the very least, check out the comments (they’re the lines that start with a semicolon) – things like “fudge factor” and “APPLIES A VERY ARTIFICIAL CORRECTION FOR DECLINE” don’t require programming expertise to understand.

;
; PLOTS 'ALL' REGION MXD timeseries from age banded and from hugershoff
; standardised datasets.
; Reads Harry's regional timeseries and outputs the 1600-1992 portion
; with missing values set appropriately.  Uses mxd, and just the
; "all band" timeseries
;****** APPLIES A VERY ARTIFICIAL CORRECTION FOR DECLINE*********
;
yrloc=[1400,findgen(19)*5.+1904]
valadj=[0.,0.,0.,0.,0.,-0.1,-0.25,-0.3,0.,-0.1,0.3,0.8,1.2,1.7,2.5,2.6,2.6,$
  2.6,2.6,2.6]*0.75         ; fudge factor
if n_elements(yrloc) ne n_elements(valadj) then message,'Oooops!'
;
loadct,39
def_1color,20,color='red'
plot,[0,1]
multi_plot,nrow=4,layout='large'
if !d.name eq 'X' then begin
  window, ysize=800
  !p.font=-1
endif else begin
  !p.font=0
  device,/helvetica,/bold,font_size=18
endelse
;
; Get regional tree lists and rbar
;
restore,filename='reglists.idlsave'
harryfn=['nwcan','wnam','cecan','nweur','sweur','nsib','csib','tib',$
  'esib','allsites']
;
rawdat=fltarr(4,2000)
for i = nreg-1 , nreg-1 do begin
  fn='mxd.'+harryfn(i)+'.pa.mean.dat'
  print,fn
  openr,1,fn
  readf,1,rawdat
  close,1
  ;
  densadj=reform(rawdat(2:3,*))
  ml=where(densadj eq -99.999,nmiss)
  densadj(ml)=!values.f_nan
  ;
  x=reform(rawdat(0,*))
  kl=where((x ge 1400) and (x le 1992))
  x=x(kl)
  densall=densadj(1,kl)     ; all bands
  densadj=densadj(0,kl)     ; 2-6 bands
  ;
  ; Now normalise w.r.t. 1881-1960
  ;
  mknormal,densadj,x,refperiod=[1881,1960],refmean=refmean,refsd=refsd
  mknormal,densall,x,refperiod=[1881,1960],refmean=refmean,refsd=refsd
;
; APPLY ARTIFICIAL CORRECTION
;
yearlyadj=interpol(valadj,yrloc,x)
densall=densall+yearlyadj
  ;
  ; Now plot them
  ;
  filter_cru,20,tsin=densall,tslow=tslow,/nan
  cpl_barts,x,densall,title='Age-banded MXD from all sites',$
    xrange=[1399.5,1994.5],xtitle='Year',/xstyle,$
    zeroline=tslow,yrange=[-7,3]
  oplot,x,tslow,thick=3
  oplot,!x.crange,[0.,0.],linestyle=1
  ;
endfor
;
; Restore the Hugershoff NHD1 (see Nature paper 2)
;
xband=x
restore,filename='../tree5/densadj_MEAN.idlsave'
; gets: x,densadj,n,neff
;
; Extract the post 1600 part
;
kl=where(x ge 1400)
x=x(kl)
densadj=densadj(kl)
;
; APPLY ARTIFICIAL CORRECTION
;
yearlyadj=interpol(valadj,yrloc,x)
densadj=densadj+yearlyadj
;
; Now plot it too
;
filter_cru,20,tsin=densadj,tslow=tshug,/nan
cpl_barts,x,densadj,title='Hugershoff-standardised MXD from all sites',$
  xrange=[1399.5,1994.5],xtitle='Year',/xstyle,$
  zeroline=tshug,yrange=[-7,3],bar_color=20
oplot,x,tshug,thick=3,color=20
oplot,!x.crange,[0.,0.],linestyle=1
;
; Now overplot their bidecadal components
;
plot,xband,tslow,$
  xrange=[1399.5,1994.5],xtitle='Year',/xstyle,$
  yrange=[-6,2],thick=3,title='Low-pass (20-yr) filtered comparison'
oplot,x,tshug,thick=3,color=20
oplot,!x.crange,[0.,0.],linestyle=1
;
; Now overplot their 50-yr components
;
filter_cru,50,tsin=densadj,tslow=tshug,/nan
filter_cru,50,tsin=densall,tslow=tslow,/nan
plot,xband,tslow,$
  xrange=[1399.5,1994.5],xtitle='Year',/xstyle,$
  yrange=[-6,2],thick=3,title='Low-pass (50-yr) filtered comparison'
oplot,x,tshug,thick=3,color=20
oplot,!x.crange,[0.,0.],linestyle=1
;
; Now compute the full, high and low pass correlations between the two
; series
;
perst=1400.
peren=1992.
;
openw,1,'corr_age2hug.out'
thalf=[10.,30.,50.,100.]
ntry=n_elements(thalf)
printf,1,'Correlations between timeseries'
printf,1,'Age-banded vs. Hugershoff-standardised'
printf,1,'     Region    Full   <10   >10   >30   >50  >100'
;
kla=where((xband ge perst) and (xband le peren))
klh=where((x ge perst) and (x le peren))
ts1=densadj(klh)
ts2=densall(kla)
;
r1=correlate(ts1,ts2)
rall=fltarr(ntry)
for i = 0 , ntry-1 do begin
  filter_cru,thalf(i),tsin=ts1,tslow=tslow1,tshigh=tshi1,/nan
  filter_cru,thalf(i),tsin=ts2,tslow=tslow2,tshigh=tshi2,/nan
  if i eq 0 then r2=correlate(tshi1,tshi2)
  rall(i)=correlate(tslow1,tslow2)
endfor
;
printf,1,'ALL SITES',r1,r2,rall,$
  format='(A11,2X,6F6.2)'
;
printf,1,' '
printf,1,'Correlations carried out over the period ',perst,peren
;
close,1
;
end

The Obama Administration is considering whether to change policy concerning the use of HTTP cookies on government websites. Currently, government officials require a “compelling need” to use persistent HTTP cookies, and must disclose their use in a privacy policy.

In light of this we arbitrarily chose six government websites to determine whether Flash was being used to assign unique values to visitors. Of the 6 government sites we tested, 3 had Flash cookies. Three were set by whitehouse.gov, one of which was labeled, “userId.” Five of these sites used persistent HTTP cookies.

Whitehouse.gov disclosed the presence of a tracking technology in its privacy policy, but the policy does not specify that Flash cookies are present, nor does it provide any information on how to disable Flash cookies.

The White House “disclosure” still doesn’t mention Flash cookies or how to disable them. It does however state the following:

This persistent cookie is used by some third party providers to help maintain the integrity of video statistics. A waiver has been issued by the White House Counsel’s office to allow for the use of this persistent cookie.

If you would like to view a video without the use of persistent cookies, a link to download the video file is typically provided just below the video.

If the White House videos can be viewed without the use of persistent cookies, than what compelling reason is there for this waiver?

This is so like this administration (and the several previous ones as well): Make a rule, then have the White House Counsel issue waivers for it. Obama’s first executive order was to forbid lobbyists from presidentially appointed positions – a waiver for that was issued before the day was out, and in less than a week, the second most important post in the Pentagon was given to a lobbyist. Not to mention Obama’s claim of “sovereign immunity” when it comes to lawsuits against the government concerning warrant-less wiretapping.

Until we have government officials who respect the Rule of Law – instead of the Rule of Individuals – and honor their oath to the Constitution, they shouldn’t expect anyone to trust them.

And a heartfelt congratulations to Sean Hannity for quickly changing the subject instead of calling her on such a blatant distortion of reality – like the responsible journalist he is.

]]> http://rubereality.com/2009/11/27/dana-perino-political-revisionist-and-liar/feed/ 0 http://rubereality.com/2009/11/17/ceremonial-deism/ http://rubereality.com/2009/11/17/ceremonial-deism/#comments Tue, 17 Nov 2009 07:52:04 +0000 Herkimer http://rubereality.com/?p=158 “In God We Trust” did not appear on any coin until 1864. It wasn’t used on all coins until Roosevelt’s presidency, it wasn’t mandated by legislation on all coins until 1955, nor made the official motto of the United States until 1956. Likewise, the Pledge of Allegiance wasn’t even written until 1892, and the words “Under God” weren’t added until 1954. So enough of this nonsensical revisionism that the Founding Fathers were all devoted Christians and founded this country as a Christian nation – those who utter such nonsense are bearing false witness. Even were that not the case, the difference between their faith and today’s “American Christian” is this: they were unwilling to cheapen God’s name by printing it on something so base as money or by using it in political slogans & statements.

…I would suggest that such practices as the designation of “In God We Trust” as our national motto, or the references to God contained in the Pledge of Allegiance to the flag can best be understood, in Dean Rostow’s apt phrase, as a form a “ceremonial deism,” protected from Establishment Clause scrutiny chiefly because they have lost through rote repetition any significant religious content.

From Justice Brennan’s dissenting opinion in Lynch v. Donnelly, 465 U.S. 668 (1984)

L.  responded ‘Yes’
L. voted in the poll: “Do you beleive abortion should be legalized nationally? ” along with 56712 other people.

And here’s a newsflash for a country suffering from historical Alzheimer’s:

Roe v. Wade Headline 1973

OK, admittedly, it’s not news, since this paper is dated January 23, 1973. Almost 40 years ago! But some things never change: GM is still recalling cars, Kissinger’s still an idiot (though the Vietnam war is long over despite his best efforts), and the NY Times is still getting things wrong like reporting the “Country Mourns Truman” when Lyndon Johnson died. And, of course, we’re still talking about Roe v. Wade!

The stupidity of that survey is breathtaking, starting with the misspelling of believe! But obvious stupidities in the survey creator aside, even the most staunch conservative isn’t claiming abortion is illegal. At the very least, they want that option available in the event their chaste and pure daughters are violated by some undesirable they don’t approve of.

With so many other issues that haven’t been decided, that weren’t even an issue in 1973, and that are for more critical now, why would anyone care about this almost forty years later? I was thinking my friend L., who is an avowed socialist, was just doing this to impress some feminazi with how liberal he is in the hopes of getting laid.

But the comments to his post prove me wrong:

J: Icky L!!! I don’t want to see that picture
L: Then don’t look at it, J. I’m assuming a conservative made up this poll, they used the craziest photo they could find.

The picture referred to is a bloody aborted fetus – it’s tasteless enough to lead me to believe it was used just to be provocative. However, L likes to use pictures of Charles Manson for his profile picture on Facebook. He currently has one with Manson’s eyes whited out to give the impression of being a zombie or demonically possessed. People in glass houses shouldn’t talk about crazy photos!

Apparently though, the real motive is this: because a conservative made up this poll, L apparently felt it was not only necessary to take the poll but to share it on his wall with all his Facebook friends. He’s letting the Republicrat party determine the “issues” for him, instead of being a free agent capable of his own thoughts and deeds who tells his representatives what the issues are. As liberal as he believes he is, he’s just as reactionary as the most puritanical teetotaler screaming for a boycott of a cable network because they showed some nipple at 3am, rather than just changing the channel or going to bed. Just as divisive too, over an issue politicians love pedaling to the masses and do nothing one way or the other to ever change.

L had better watch what he wishes for. I have a feeling that if we had outright socialized health care as he desires, abortions would be even more limited than they were before Roe v. Wade, because they are both expensive and risky and would have to be limited for purely economic reasons. Why do we follow these thugs? They’ll legislate birth laws into health care, they’ll legislate even more on when and how we’re allowed to die than they already have (anyone remember Terry Schiavo?), and of course, they’ll tell us how to live every day of our lives in between birth and death. There is nothing liberal about losing your liberties over a non-issue.

According to this ESPN article, he’s openly admitted to his steroid use. In 1974, he told Barbara Walters:

“I take steroids because they help me an extra 5 percent. Women take the [contraception] pill. They are somewhat similar. I do it under a doctor’s supervision.”

Schwarzenegger claims he didn’t break any laws with the steroids, but he certainly wasn’t being ethical:

Schwarzenegger, in past interviews, has claimed that he broke no laws when taking steroids…Prior to 1990, when the federal government made the drugs a controlled substance, there was nothing illegal about doctors writing steroid prescriptions for athletic purposes. However, taking drugs to enhance sports performance has been considered unethical since the late ’60s. Schwarzenegger, like bodybuilding itself, merely pioneered the path of win-at-all-costs.

Nor were steroids the only drug he did, as he told Oui magazine in 1977:

“I’m a competitive bodybuilder; I’m not training just to be healthy. Ninety-five percent of the people training with weights are into this health thing, and it’s a different mentality entirely. As far as I’m concerned, it’s bullshit; otherwise I wouldn’t drink. I make my protein drink with whiskey. People think I’m crazy, but that’s the way I am. I get stoned, I do my own thing.”

Pot was definitely illegal at the time he said this in 1977 – just one year before Polanski’s crime.

Justice is supposed to be blind, which means – assuming the statutes of limitations haven’t run out yet – both of these “gentlemen” should pay for their crimes.

“I don’t expect to actually read the legislative language because reading the legislative language is among the more confusing things I’ve ever read in my life.”
If legislative language is confusing for a lawmaker, then why is he a legislator? Oh, that’s right, Congress doesn’t actually legislate – that’s the job of Congressional aides who, unlike most Congressmen, can actually express a coherent thought. The lobbyists who have an interest in any given bill are certainly a big help in writing bills too.

“We, we write in this committee and legislate with plain English and I think most of us can understand most of that.”
Most Congressmen can understand most of the plain English? This implies that there’s some plain English they don’t understand, and Carper certainly has a problem speaking plain English!

“Senator Conrad actually read some of it, several pages of it, the other day and I don’t think anybody had a clue–including people who have served on this committee for decades–what he was talking about.”
A Congressman finally admitting that Congress doesn’t have a clue! And the American voters’ response? Silence, with a cricket chirping in the background.

“…legislative language is so arcane, so confusing…and it’s just, it really doesn’t make much sense”
How are the American people supposed to obey the dictates of the laws Congress enacts, if even those writing the law consider it arcane and confusing?

“The idea of reading the legislative language: It’s just anyone who says that they can do that and actually get much out of it is trying to pull the wool over our eyes.”
Ergo, anyone in Congress who votes for this legislation is trying to pull the wool over the eyes of the rest of the country!

“They might say that they’re understanding it. But that would probably be the triumph of man’s hope over experience. It’s hard stuff to understand.”
Hope of change in one hand, Washington bullshit in another – see which one fills up first!

“I use it to like, for example, credit card disclosures. If you actually read the stuff, you say, you read it and say, like dozens of pages: ‘What does this say?’ And this is one of the reasons why we’ve directed, among others, banks to use plain, plain language, plain English to explain what they’re doing, so that the gibberish, you can’t read it and really know what it says.”
This is one major reason I have no credit cards (Congress allowing credit card companies to charge extortionate interest rates is the other). I really doubt that if a credit card company presses it’s claim on your debts in the court system the “plain language” is what will be considered by the court. If Congress makes health insurance mandatory, I won’t have the choice to just say no like I do with the banks’ credit. If Congress can pass a law to require the banks to use plain language, why can’t they do the same themselves? Most importantly, how can anyone compare credit card language to health insurance language? Does this guy truly believe my credit score with the banks is more important than my health? Well, in looking at his bio, Mr. Carper is an economist, so it should come as no shock that his view of reality is just a tad skewed.

“If people who work here on a daily basis and work with the legislation and shape the legislation…maybe it doesn’t make much sense for either the legislators or me to read that kind of arcane language. It’s just hard to decipher what it really means.”
It makes perfect sense to me: The “incomprehensible and arcane” language is what will be made into law. That’s the language that has to be interpreted by the folks who will implement your reforms and the folks who have to enforce the laws. If the people creating the legislation can’t understand the laws they are enacting, how is any body else down the road supposed to? Isn’t this an example of “triumph of man’s hope over experience?”

The Interviewer asks if the legislative language will be available for the American people to read. Response: “Why that is a value and why someone should need to read that, or feel the need–I don’t understand…”
If you don’t understand thr value or the need for people to read the version that will be made into law that has to be followed, then you don’t understand the point of having law – and you certainly don’t understand justice. Is the health reform legislation going to have a plain English version ordered by law? NO! In essence, you’re voting on different legislation than what you’ve read and debated in committee.

In the accompanying article, it was noted that “Sen. John Cornyn (R-Texas), who also serves on the committee, said the descriptive language the committee is working with is not good enough because things can get slipped into the legislation unseen.”
That’s exactly what happened with the bank bailout a year ago. It didn’t pass in the house, the senate took it and added all sorts of pork barrel riders and passed it, then the house took the senate’s version and added even more riders, and they were happy and passed it so Bush could then sign it into law as the largest Christmas tree bill ever.

It really is a crying shame that 99% of Congress is so afraid of rocking the boat by making any kind of principled stand to do the right thing that they can delude themselves so completely as Mr. Carper has.

The primary witness giving testimony was Scott Alverez, who is General Counsel to the Board of Governors of the Federal Reserve. I’ve never heard such Orwellian double-speak in my life. Here’s a man who can look Congress in the eye and say with a straight face – and a well polished passive-agressive routine – that in order for there to be transparency in the financial system and to have transparent, open banks, it’s necessary for the fed to do things in secret and without any oversight from any governmental agency.

Furthermore, Mr. Alavrez stated his belief (in a repetition of other Fed officials, including Ben Bernanke) that a GAO audit would hurt the Fed’s ability to effectively determine monetary policy and set interest rates. Let’s consider how well the Fed has done in their mission, which is to stabilize prices and keep everyone employed. Since 1913, when the Fed Reserve Act was passed and Congress abdicated their Congressional duty, the dollar has lost 96% of it’s purchasing power due to monetary inflation.  We’ve also had a Great Depression and several major recessions – all of which were accompanied by wide-scale unemployment. The boom/bust cycle the Fed was supposed to alleviate has continued over the last century, but as one Congressman pointed out during the hearing, the amplitude of that cycle has increased – i.e., the booms result in bigger bubbles, and correspondingly the busts result in more painful recessions and depressions.  The Fed Reserve has done such a poor job fulfilling their mission, that they had to have the taxpayers fund them to the tune of nearly 10 trillion dollars to fix the mess they created by pushing for deregulation and holding interest rates artificially low for so long – not to mention their role in unleashing derivatives on the world. It’s clear to me they’ve failed their mission – even with all the secrecy they’ve had. How could a GAO audit possibly hurt the Fed’s performance? The only way that comes to my mind is if they carry out their implied threats to Congress about wrecking the economy. Haven’t they already wrecked it?  Andrew Jackson heard the same threats from Nicholas Biddle (though Biddle was more direct), Jackson “killed the bank” anyway, Biddle contracted credit and caused a recession – and in the end, the power, economy and real wealth of the USA still expanded faster without any central bank then it has since the Fed Reserve Act was passed.

Another reason cited by Alverez for maintaining the secrecy is that borrowers who take money from the various Fed programs shouldn’t be stigmatized for borrowing that money. That’s funny, because when I go to a bank for a loan, I have to give the bank permission to run a credit report, which shows who I’ve borrowed money from. I can refuse the credit report, but the bank likely won’t lend me any money then. It’s only fair that a lender should know what kind of a credit risk I am, an argument I would have thought anybody in the Fed Reserve would agree with. Why then, especially if taxpayer money is involved, shouldn’t the largest firms on Wall Street, be subjected to the same scrutiny before that money is given to them? As publicly traded companies, they already have to report their financials.  Taking TARP money shouldn’t exempt them from their legal obligations, so if they’re not breaking the law they would be stigmatized anyway – as they should be in a free and open market economy. So whose privacy is the Federal Reserve really concerned about here?

According to Mr Alvarez, the Fed will loan money to anyone so long as they feel confident (as in “more than 51%” confident) they’ll be paid back – and if they feel confident, they don’t need to have those loans secured by anything. So the worst credit risk in the world – a Wall Street bank that’s been run into the ground because they over-leveraged themselves on their overvalued sub-prime assets – can get tax-payer money from the Fed Reserve, in secret, with no collateral! I wonder how those banks report this on the balance sheet without mentioning where those assets came from?  In short, Mr. Alvarez believes the Fed has the right to increase the country’s debt by $10 trillion in secret and without any oversight – and Ben Bernanke has stated the same belief. Apparently they don’t believe spending that much taxpayer money has any political ramifications, which leads me to question their sanity.

Let’s assume the Fed has actually done a good job over the last 96 years. How would an audit harm their ability to do their job? The claim made by both the Fed Reserve and most of Washington officialdom (including Barney Frank), is that the market could be manipulated by knowledge of the Fed’s Trades, and so they should at least be kept secret for a temporary time – anything from one month to five years depending on which political blowhard is running their mouth. The entire Financial Services committee seems to agree with this, but I don’t. Firstly, how would anyone profit from what would be publicly available knowledge that anyone can get? You can’t do illegal insider trading based on what you saw on the TV news last night. Secondly, any trade I as an individual have executed (and even any movement of money between say, my checking and savings account) is also subject to review under the Patriot Act, and in certain conditions a “Suspicious Activity Report” (SAR) has to be filed with the Treasury Dept. Simply moving to another state and changing the address on your account will trigger an SAR! Why is everyone in this country except the Federal Reserve required to have their trades disclosed to the government? Even when a CEO makes a multi-million dollar trade in his own company, that trade must be reported publicly to the SEC as an “insider trade” within days – and public knowledge of those trades has never hurt the market. Why should the Federal Reserve, especially now that they are involved directly with taxpayer-funded bailouts, not be subject to the same scrutiny as the rest of us?

An interesting surprise for me was a Democrat from Florida named Alan Grayson.  While the questions he’s asking are simple and aren’t new, the matter in which he questions people from the Fed puts a smile on my face and makes me want to cheer. I’m not so sure he isn’t potentially a demagogue witch-hunter, similar to McCarthy – but he’s simply looking for honest answers so far and not putting up with the Fed’s typically dissembling ways, so for now at least, more power to him! Barney Frank, on the other hand, is a proven demagogue who, even on a bi-partison bill with 290 cosponsors, still ran this hearing with an obvious bias to his party and their agendas. He seems to support this bill as part of a larger regulatory reform package – which makes no sense to me. How can Congress say what needs to be reformed with the Fed Reserve until a real audit is performed?

Robert Kuttner testified before Frank’s Financial Services Committee in Oct 2007 “Since repeal of Glass Steagall in 1999, after more than a decade of de facto inroads, super banks have been able to re-enact the same kinds of structural conflicts of interest that were endemic in the 1920s – lending to speculators, packaging and securitizing credits and then selling them off, wholesale or retail, and extracting fees at every step along the way. And, much of this paper is even more opaque to bank examiners than its counterparts were in the 1920s.” Maybe I missed it, but I don’t see that Frank has any interest whatsoever in putting Glass-Steagall back in place, and based on his reactions to events in the governmental housing agencies that are his favorite pet projects, I expect whatever regulatory “reform” he comes up with will prove to be as useful as a band-aid being applied where a tourniquet is needed.

The Fed bailing out it’s chosen few has introduced a far bigger problem with “moral hazard” than the Fed clearly wants to admit. When the government allowed Goldman and Morgan to “change” from “independent investment banks” to “bank holding companies” (a move made possible by the revocation of Glass-Stegall) those firms were then in a position to take bailouts. (Lehman Bros. was not allowed to make this change, and so they weren’t bailed out and failed as a business).  This is from the N.Y. Times report on this story (bolded emphasis mine):

“While accelerated by market sentiment, our decision to be regulated by the Federal Reserve is based on the recognition that such regulation provides its members with…access to permanent liquidity and funding,” Lloyd C. Blankfein, Goldman Sachs’s chairman and chief executive, said in a statement Sunday night. “We believe that Goldman Sachs, under Federal Reserve supervision, will be regarded as an even more secure institution with an exceptionally clean balance sheet and a greater diversity of funding sources.”

John J. Mack, Morgan Stanley’s chairman and chief executive, issued a statement that said: “This new bank holding structure will ensure that Morgan Stanley is in the strongest possible position – with the stability and flexibility to seize opportunities in the rapidly changing financial marketplace. It also offers the marketplace certainty about the strength of our financial position and our access to funding.”

The two men who chair the boards and run these companies view their new companies’ new status as holding companies as a good thing because they can expect to be funded and/or bailed out whenever it’s necessary.  These statements were made before the Congressional bailout, and they go to show that moral hazard is a far larger issue to be dealt with than the Federal Reserve is admitting, for the simple reason that these companies’ beliefs about “permanent funding” became established fact with the bailout – the precedent’s been set. The Fed’s position on moral hazard since March of 2008 has steadily been that it’s an issue of concern, but they’re aware of and will deal with it – in fact, they’re so confident in what they’re doing they have managed to convince Obama they should have more regulatory power.  I’d like to know when they’re going to deal with moral hazard, and I’d like to know how, when they, in their position of leadership in the banking community, aren’t setting a good example to follow by continuing to insist on secrecy?

Alverez was asked by Grayson if the Fed Reserve has ever manipulated the stock market. Alvarez refused to admit the Fed “manipulates” but he did say the Fed “participates” indirectly through dealers. Where’s the line that separates “participating” in a market from “manipulating” the market, especially in light of the Federal Reserve’s responsibility to set the country’s monetary policies and the power they’ve been granted to do so? Greater authority should come with greater accountability, and the Fed’s entire case against a GAO audit seems to rest with arguing the opposite. In Friday’s hearing in fact, the case was made that the Fed Reserve can’t be independent without privacy. I can’t see any reason they must be independent. Regardless, as I have no guaranteed privacy since the Patriot Act was passed, by the Fed’s argument I also have no guaranteed independence. If this is a democracy as I’m continually being told by the political leadership of this country, then the Fed Reserve should have the same amount of privacy and independence as I do. Really, what’s the big deal? If the Fed Reserve has done no wrong, then they should have nothing to hide, right?

In reality, I can think of plenty of things they’d want hidden that are already right in plain sight. For example, Alvarez, during Grayson’s questioning, explained that the Fed will execute trades through Primary Dealers in their attempts to manipulate interest rates in order to fulfill their charter. He mentioned J.P. Morgan as one of those dealers and said the full list is on the Fed’s web site. It sure is, the latest of which is here. On this list, you will find, among others, J. P. Morgan Securities Inc., and Goldman, Sachs & Co. These are the two companies mentioned in the N.Y. Times article – and their status as Federal Reserve Primary Dealers hasn’t changed in the period since they changed their status to “bank holding companies” and took taxpayer-funded bailout money, despite the capital requirements alone for being a Primary Dealer. Just how many conflicts of interest will it take before Congress passes some real reform? Forget this New Economy bullshit that Wall Street loves to spout already – isn’t it apparent by now that it’s all just recycled Ponzi schemes with new technology!

Grayson asked Bernanke in a July hearing about $1/2 trillion in loans to foreign central banks, and was told by Bernanke that it was a coincidence that the dollar had gone up in value by 30% at the same time. A quick history lesson (of the type Barney Frank will never give at the start of a hearing): These central bankers have financed all the major wars – and more importantly the dictatorial leaders that started or led them – of the last 200 years. That includes Napoleon, Lenin, Stalin, Hitler, Mussolini, and Mao – and of course both political parties here in all of their usually misguided endeavors.  Today in 2009, when Ron Paul’s bill will strike a measure from current law that says Fed Reserve “transactions for or with a foreign central bank, government of a foreign country, or nonprivate international financing organization” can’t be audited, the public figures of the Federal Reserve all have the gall to stand up and say they need their privacy and that GAO scrutiny of their policy-making would politicize monetary policy. This is brazen as it gets: these people who clearly have NO national loyalties have taken trillions in taxpayer money (which has been – and is still being – used in a fire-sale redistribution of wealth and will at some point in the near future drive inflation), have held interest rates at artificial lows for nearly two decades to help various political figures and campaigns, have enabled the U.S. government to run budget deficits for over 50 years straight, and are financing foreign banks and governments behind closed doors, and these people have the nerve to say they aren’t politicized already?

An organization that has always been as secretive as the Federal Reserve has been, and who reacts in such a defensive matter over a simple audit (as Ron Paul lectured Alverez at one point, it’s silly to believe GAO audits set policy), will drive conspiracy theories, whether true or not, and this was pointed out to Alverez at one point. Even if all the decision-making at the Federal Reserve is always done with the most pure and noble of intentions, maintaining so much secrecy promotes social unrest, and doing so is therefore a political act in and of itself.  As the various members of the Federal Reserve have themselves said, it would be a bad thing if their institution was politicized. How can the Federal Reserve then, with any reasonable argument, continue to stand against any reform that might come from an audit, much less the audit itself?