THE FALLACIOUS REASONING OF ABSTRACT THINKERS

Margaret Tuchman's fine book The March of Folly reveals mankind’s propensity to follow disastrous policies to their most adverse ends. Her book, written in 1984, is about some of history's greatest blunders, and apparently has gone unnoticed by today's leaders for folly still permeates the world's capitols and the minds of those in power. The first decade of the new millennium, rather than showing a return to any measure of common sense, has indicated a continuation of folly among our leadership elites on the grandest scale.

In my new book, Wasted Genius, I attribute much of such folly to the rise of a new Ruling Class that is distinguished by their love of abstract concepts and theoretical reasoning which they arrogantly maintain is superior to the practical reasoning and simple common sense employed by the majority of Americans. Angelo Codevilla has written about how this new Ruling Class elite stands in stark contrast to the "Country Class" which includes most of the hard-working, less educated mass of common people. And, yet it is that country class of workers who make America run while the elites merely advise, criticize, commentate, and then initiate the disastrous policies that are bringing America to its knees and bankrupting the future financial well being of our children.

Our major problem comes from a previously unrecognized mental and moral deficiency in our intellectual elite, now exposed for the first time--for details go to http://www.thewastedgenius.com/

This new ruling class has been created by an educational establishment that maintains an almost religious Faith in the supreme importance of test scores and school grades. School policy and college selection has become a slave to the unfounded notion that IQ and SAT tests indicate an individual's worth. In fact, they merely reward abstract thinkers and hold back the practical minds needed to restore America's success story.

The tests are the darlings of academics and school teachers who like the ease of use and their seemingly scientific basis. Not to mention that a theory "proving" the stupidity of their students relieves the teaching establishment of responsibility for results. This long-standing infatuation with tests has been further cultivated by intellectual wanna-be’s who enjoy feelings of superiority, even if such pride is based simply on a good memory, a quickness with words, and well developed test-taking skills. And yet such academic virtuosity represents only a fraction of a person's total competency. We are neglecting the education of many superior students that possess more of several other essential cognitive abilities unmeasured by today's favored tests.

Because Americans have been hood-winked into respecting academic grades and abstract thought, and subordinate their visceral common sense to the apparent expertise of over-educated theorists, we have become dominated by a ruling elite that may appear very “bright” but is, in fact, subject to the worst kinds of folly. If there was a tipping point to this victory of abstractions over sense it may have been during the administration of Woodrow Wilson, the very revered and intellectual Princeton professor who (count these follies!) managed to launch us into “the war to end all wars,” invigorate the Progressive movement of big government, establish the IRS and Federal Reserve System, dream up the impotent League of Nations, and sign off on a Treaty that so crippled Germany that a subsequent World War became inevitable. No wonder the egg-heads loved him--he created a future for all the bright kids that didn't want to get jobs in the real workplaces of America.

Only an intellectual possesses the conceptualizing flexibility to believe in “a war to end all wars.” Similarly, it is primarily a mind crippled by abstractions that finds sense in such lofty phrases as “a war on poverty,” a war “to spread democracy,” a mantra about "hope and change," or foreign aid programs that give billions of dollars to dictators to “help” third world countries.

We currently are hearing an impossibly nuanced explanation about why our planes are bombing people in Libya--the administration claims to be "walking a fine line over the end game of the assault." It is avoiding for now any appearance that it aims to take out Gadhafi or help the rebels oust him, instead limiting its stated goals to protecting civilians, notwithstanding the fact that our bombers are killing many of those they seek to "protect."

We have just recently seen the folly in domestic affairs where our leaders in Washington took on a mission impossible--to boost the commendable goal of home ownership by subsidizing mortgages to individuals with little prospect of ever repaying the loans. Of course, this folly may have been perpetuated more by cupidity than by stupidity because the Ruling Class insiders stood to benefit financially by the conspiracy between bankers and politicians who rode the bubble in real estate to obscene profits and then dumped off the losses with securitized packages of worthless paper to unsuspecting investors, and ended by bailing out any favored insiders who got caught holding the worthless paper they had not yet succeeded in dumping on the public.

Only those with the cognitive agility to take great leaps of conceptual fancy will advance those kinds of incredible ideas as national policy and then forge ahead, convinced of the soundness of their reasoning, confident of the veracity of their theoretical justifications, enthusiastic with a confidence undiminished by any lack of positive results, oblivious or in denial concerning the adverse unintended consequences of their actions, but still managing to line their own pockets through it all.

Such persistence shows that this well-connected elite is empowered by an intellectual arrogance, a conviction that their critics are wrong and mean-spirited, and that the sheer power of their own intellect anoints them with the right to profit and rule over the common people, the Country Party to use Professor Codevilla's words, or what we have historically referred to as grass roots America.

Those are the kinds of minds that have usurped power in America. It is their new way of thinking that has reduced our leadership to community organizers, agitators, Wall Street speculators, and other self aggrandizing groups representing, not the ordinary people of this country, but the insiders concentrated on ripping off for themselves whatever they can get away with.

Unfortunately, many well meaning voters are in thrall to the supposed expertise of these frauds. And many voters are swayed by the promises offered, whether they be public employees, farmers, union members, grant recipients, subsidized businesses, or all the recipients of government hand-outs. Out of this muddled blend of self-interest and self-righteous compassion for others, half the country supports this elite's call for expanded government bureaucracies--even if the consequences bear constant witness to their folly.

Obama's Money Tree and Washington's Ponzi Schemes

February 21, 2011

The latest news out of Washington indicates that our fearless leaders have not let the recent financial meltdown lessen their affection for Ponzi-type schemes. It may be recalled that the 2009 stimulus act saw the federal government lending the most bankrupt state governments billions of dollars to postpone their imminent financial crises. The loans were interest free for two years and "easily" financed by the feds because they can just print money as needed!

However, on this past December 31 the two years were up, 30 states owed $42 billion, with interest now accruing, and their resident businesses faced with increased mandated federal payroll taxes to help repay the loans. It appeared that the Ponzi scheme might unravel. The states are too broke to make any substantial repayment, and the Administration is leery of hiking taxes on the beleaguered business community. So, a tough and courageous decision was called for. Guess what we got?

The apparent "solution" will apparently come in President Obama's 2012 budget where he will propose waiving the tax increase and postponing the interest charges for two more years. Presumably he could also lend them more money and defer repayment till some future undesignated date. Thus the money tree at the Federal Reserve takes on the State deficits as well as the federal deficits. The problem is thus postponed, true to its Ponzian roots, and the escalating debt will only come home to roost at some future time.

We can only hope that some intrepid, brilliant, and unscrupulous Goldman Sachs employee will accumulate these "sub-prime" notes, securitize them, and sell them to the Chinese. Otherwise they will not go away quietly.

Could Compromise and Non-partisanship Make a Better Congress?

Retiring Sen. Evan Bayh recently warned that Congress needs harmony and must drop its rampant partisanship. In a nationally broadcast interview, the Indiana Democrat said, "The extremes of both parties have to be willing to accept compromises" in order to accomplish things for the national good. He added that voters are in a mood to turn out many incumbents "until we change this town, until we reform Congress." Doesn't that sound grand? But haven't we heard such nonsense before, many, many times?

The American political scene has never been harmonious nor has political ambition ever taken a back-seat to civility. Such mere "words" have proven meaningless in the actual conduct of affairs of state. What is needed instead of harmony and fancy words is a rational and non-ideological approach to solving the problems facing the nation. And the biggest problem now and for the forseeable future is the economy. The recent record of government oversight and management of the economy has proven disastrous so a change is both obvious and essential. And the change needed is so drastic that "compromise" cannot be the answer.

Congress and the Presidents have been compromising over spending, taxes and the budget forever, and recently those three vital areas of government have spun out of control. The annual spending deficits and the national debt have escalated so grotesquely that the restoration of fiscal sanity should be the first order of business. Sadly, the goal of even the most prudent observers is to merely "reduce' the deficit within some 5-10 year future period, and THEN to reduce the debt. That is hogwash. It is merely defering the problem off conveniently into the future. That has been the modus operandi for too long. It does not work.

Partisans can argue over the merits of every conceivable government program and policy until the cows come home but the programs themselves are not our major concern. The major concern is that the programs, whatever they may be, must be paid for out of current receipts. A balanced budget provides a self-limiting control over the nation's finances. It doesn't matter whether we believe that all government spending is essential or totally wasted--just as long as it is covered by revenue and nothing is added to our national debt. It would be nice to think that our elected officials could streamline government, simplify and eliminate overlapping inefficient programs, and eliminate corruption, expensive junkets, pork, and bribery. But it is more important right now to just live within our income. We could actually survive with waste and pork if it was paid for without issuing phony paper money! Fighting over the way it is spent is just a diversion and hides the real problem of how do we pay for it.

A balanced budget that included actuarial computation of deferred mandate expenses would force a large reduction in spending and a big tax increase. The difference between what Congress is committing for and actual income is too huge not to require both. Such a policy would provide an important wake up call about how serious the problem is. And voters would be made vividly aware of both the curtailment of expenditures and the added burden of taxes. They would then be in a position to evaluate the issues at stake. But we would have stemmed the bleeding. Think of a gaping wound and the need above all else is for a tourniquet.

At present, the arcane chicanery of the Federal Reserve and its compulsive printing of money and issuing debt hides the perilous situation we face. What we have been doing is allowing foreign nations to own more and more of our national debt which will eventually give them an inordinate control over us. And hardly noticed, the escalating interest on that debt further burdens the annual budget, and grows larger every year.

Sen. Evan Bayh says partisanship and gridlock made it time for him to quit. It would have been better for him to enter legislation to keep all spending within the amount of revenue taken in. Then Congress would be free to fight over whether those expenditures would go to farmers, single moms, the aged, the injured, the homeless, the military, or the schools. Where it went would be secondary compared to the fact that we would be living within our means and the costs would be visible to everyone. To gain this essential situation every voter should look chiefly for a politician's pledge to balance the budget "now, not in the future sometime." The candidate's stated position on gay rights, foreign aid, welfare, and the war on terror, will not be terribly important if America goes bankrupt and is owned by foreign nations that have learned to save rather than just spend.