Friday, August 12, 2011

Why a nuclear Iran is nothing to fear.


Last night's Republican debates brought a heated exchange between Ron Paul and Rick Santorum. Paul was asked if his policy on Iran is unchanged from 2009, when he said, “Sanctions are not diplomacy. They are a precursor to war and an embarrassment to a country that pays lip service to free trade. […] One can understand why they (Iran) might want to become nuclear capable if only to defend themselves and to be treated more respectfully.” Dr. Paul, of course, stood by his position that the United States has no business meddling in the internal affairs of other countries, and not fight wars that are not directly related to our national security. Senator Santorum accused Dr. Paul of “seeing the world the same way Obama does.” and went on to discuss his mis-named “Iran Freedom Act,” which starves the impoverished masses of Iran in the name of making Iran want to be a free, democratic country like the United States supposedly is. Ironically, Mr. Obama's foreign polciy has more in common with Santorum and the rest of the Neo-Conservitaves that were at the debate than he does with Dr. Paul's. A Neo-Con Obama is the topic of another post, so, I'll get back to the purpose of this post, which is:

A nuclear Iran is not a real threat to our national security (or anybody else's for that matter), for reasons I will explain below. But first:

Why would Iran even want nukes?

To answer this question, we are going to try to see things from the point of view from the Iranian leadership. Yes, I know that Mahmoud Ahmadinejad is a bad guy, but it is naive and dangerous to sit around and think that “they hate us for our freedoms,” when they have real reasons to not like how they are treated by the Western world. It is not difficult for Iran, or any other isolated government to see how they are treated compared with the rest of the world. Nuclear powers, such as Pakistan, Israel, India, and China never have sanctions imposed against them, and are welcome trading partners, even if our relationship with them is not entirely peaceful. Iran, on the other hand, sees that it has two options:

  • Option 1: Give into the international community, and give up their nuclear programs. This option is unattractive because it would effectively make Iran submissive to the whims of the international community. If they give in over nukes, then it is understood that they will give in to any mandate passed down from a body of countries that shows no respect toward them.

  • Option 2: Plow through the sanctions and disapproval of the international community, develop nuclear weapons, and then command the respect of the international community. This is the best of the two options for any country in Iran's circumstances that wishes to be respected.

If the international community, however, would back off of Iran and stay out their internal affairs, Iran might develop a nuclear weapons program, but they might not. If Iran saw that it was respected and treated as a peer in the international community, it would no longer feel obligated to build nuclear weapons in order to command the world's respect. More importantly, talking and trading freely with countries does more to bring about democratic and Western reforms than sanctions and other punishments ever could. This brings me to:

Sanctions don't work, and interfering with Iran's internal affairs is immoral.

The four-decade long failure of sanctions is so painfully obvious that I'm surprised that they are so unilaterally supported on both so-called sides of the political aisle. Basically, they prevent Western countries and their allies from selling or doing business with set countries, depriving of them of food, water, medicine, and other goods. (The international sale of goods and services on the free market are totally voluntary, and exist within they private sector. They should not be confused with foreign aid, wherein, to borrow a phrase from Ron Paul, money is stolen from the poor people in rich countries and given to rich people in poor countries.) Sanctions punish free trade and commerce. Sometimes they are targeted on specific goods, while other times they are more broad. The idea behind sanctions is that they will deprive the people of nutrition, healthcare, and other goods and cause the people to blame their government and enact reforms. Sanctions fail time and again, because repressive regimes who are sanctioned simply use state media to explain to the citizenry that the evil Western countries are the ones starving them, so the anger that sanctions hope to direct at, for example, Machmoud and the Ayatolla, are instead directed toward the United States government.

Apart from being ineffective, they are immoral. It is a natural right to engage in trade with whomever we wish, and sanctions violate that natural right

Iran is no threat, even with nukes

As crazy as Mahmoud is, he presents no threat, even with nukes, to Israel, the United States, or anybody else. Yes it's true that he believes that Israel has no right to exist, and that he denies the holocaust. However, it is absurd to even think that Iran would engage Israel, the United States, or anybody else militarily. They have almost no military, and they understand that any attack would be met with swift military action from the rest of the world. They know that they could not possibly get away with nuking Israel, as it would be an effectual committal of suicide.

Thursday, August 11, 2011

My minute-by-minute reaction to the debate, from 7:30 on

7:33 - Huntsman doesn't answer a question

7:34 - Romney flip-flops again. - We only want immigrants with PhD's

7:36 - Cain has another list of 4 things - this one on immigration - that says lots of words and conveys nothing. High fences and wide open doors built our country? Ha!

7:37 - Newt refuses to answer his question on immigration and answers Cains question instead.

7:38 - Ron Paul touches on ending the War on Drugs, ending overseas militarism, and ending the welfare state as responses to immigration.

7:40 - Romney says nothing at all, attacks Obama on taxes, balancing budget

7:42 - Pawlenty attacks Obama again, says he regrets the cigarette tax now that he finds out it was unpopular

7:43 - Bachmann will vote for something if you stick some phony pro-life language in it.

7:43 - 7:46 - Bachmann and Pawlenty argue about nothing at all and get really really annoying.

7:47 - Santoru talks vaguely about his non-existent plan to grow the economy, willing to compromise for big government.

7:49 - Newt says something almost intelligent about the super-committee, still dead wrong on "gutting the military"

7:50 - Tim Pawlenty talks about ObamneyCare - offers no real solution of his own.

7:52 - Romney supports the Tenth Amendment - only on Healthcare. Apparently not on Drug policy, or any other aspect of human behavior, constitutional or not.

7:53 - Romney will come up with some other federal bureaucracy for healthcare to replace obamacare, allow states to force people to buy health insurance

7:54 - Bachmann makes the true argument that states cannot force people to buy a good, doesn't understand the tenth amendment

7:55 - Ron Paul eloquently defines a federal system - explains that healthcare costs are caused by the lack of the free market, wants to use the free market

7:57 - Santorum makes it apparent that he doesn't understand the tenth amendment.

8:01 - lightning round

8:02 - Ron Paul happy for Rick Perry entering - he further shows Ron Paul as the standout contender

8:04 - Santorum avoids a question.

8:05 - Pawlenty thinks that saying nice things about the military will make people love him

8:06 - Romney flip flops on Afghanistan again. - too spineless to be a commander in chief, and willing to let the generals do whatever they want

8:08 - Newt mad again that he has to answer a question about his rhetoric on Lybia. - accusses Obama of flip flopping and refuses to answer a question

8:09 - John Huntsman is a cyber-Neo-Con. Wants to use the military to attack countries where cyber criminals live.

8:10 - Santorum the interventionist talks vaugely about preventing Iran from getting a nuke, wants to cyber-attack Iran (terrorism), Continues

8:13 - Ron Paul kicks some neo-con ass, realizes why Iran wants a nuke, advocates diplomacy over starving children and war-mongering.

8:16 - Herman Cain reminds my sister of Stanley from The Office and would probably spend his time in the oval office doing crossword puzzles. I agree.

8:18 - Michelle Bachmann reveals that she really doesn't believe that the constitution protects anybody that she deems to be a Terrorist,

8:20 - Santorum believes that our military has brought freedom to the world, doesn't understand why terrorists hate us.

8:22 - Ron Paul kicks Neo-Con ass again!

8:26 - Newt wants Muslims to take loyalty tests.

8:27 - Cain explains Southern views on Mormonism with all of the eloquence of an elephant giving birth at a wedding rehersal dinner.

8:29 - Bachmann says something about marriage and family values that comes from one of those nauseating commmercials.

8:31 - Romney flip-flops on marriage again, beleves that a constitutional amendment on marriage will ensure taht nobody will procreate out of wedlock

8:32 - Huntsman - "I believe in civil unions because it polls well."

8:33 - Paul says that marriage should not be a government issue at all. He is (as usual) right.

8:36 - Bachmann supports constitutional amendment

8:37 - Yeah, we know - everyone is pro-life

8:39 - Mitt Romney blames the president for an economic policy that is equal to his, would extend unemployment benefits. He has no real economic differences from Obama

8:40 - Huntsman: "blah blah blah blah" talking points

8:42 - Bachmann kind of has a clue on economic issues

8:44 - Cain, once again, suggests nothing.

8:46 - Newt is a shill for a central bank, just not as much as most other politicans.

8:47 - Ron Paul on the Fed - get rid of legal tender laws, don't pay the fed.

8:49 - Santorum thinks he's a Tea Party guy! Gimme a break! "Of course we have to raise the debt limit"

8:54 - Huntsman looks like a scary, creepy man, says something kind of smart on education, and then screws it all up for supporting the so-called debt deal.

Closing arguments

Santorum is clueless, bottom dweller

Stanley "Herman Cain"- no substance

Ron Paul kicks more ass

Romney says he believes in capitalism - an obvious lie.

Bachmann - OK

Pawlenty - says he wants to protect freedom, despite running over the tenth amendment

Huntsman - We have a cancer, it is debt" - says the guy who supported the debt limit increase.

Newt - Cheezy thanking everybody because he has nothing better to say.

Monday, August 8, 2011

The credit rating is a farse

Friday evening, we found out that one of the participants in a government-granted cartel of rating agencies has downgraded the safety of long-term US debt from AAA to AA+. This means nothing for a number of reasons:
  • The debt rankings are untrustworthy. Need proof? Mortgage backed securities - those things that collapsed in 2008 and ushered in a global financial meltdown - were ranked AAA by all three ratings agencies.
  • The U.S has been in perpetual default since 1971. I will do a post about this in the near future, but the gist of it is that under the Brenton-Woods agreement in 1953, foreign banks and creditors could redeem their federal reserve notes for gold at the rate of $35/oz. Richard Nixon closed this window in 1971, and the US has refused to fulfill this obligation. Instead it has paid its creditors through inflation. This is default by any reasonable definition of the term.
  • Finally, you would have to be a moron to put your money in US Debt. According to the treasury's own website, treasury yields are a NEGATIVE rate of interest for short term (less than 7 year) debt. This means that you PAY money for the privilege of holding US debt. Long term yields are not much better. The 30 year bonds are yielding 1.14% APY. This means that you can by a 30 year bond from the US Treasury, and if you believe the phony inflation statistics of ~2% per year, lose 1% of your "investment's" purchasing power per year. How can an investment that cannot, even under the rosiest of scenarios, even maintain purchasing power, be ranked AAA by any right-minded agency? At best, they should be ranked at best, CC. (info on bond credit ratings available here:

The phony "cuts" of the debt deal

The President and the corrupt blockheads in congress constantly reaffirm their commitment to “cutting the deficit” and dealing with the debt problem. They assure us that the deal passed to raise the debt ceiling cuts nearly two trillion dollars off of the national debt over ten years, and they call the deal a “significant step in the right direction.” The problem is that these so-called cuts aren't even cuts at all. If the deficit were cut, we would actually spend less money after ten years than we spend now. If we were serious about paying off the debt, we would make cuts deep enough to have a budget surplus in the near future.

But in Washington, they apparently don't calculate cuts in spending the way we do in the rest of the world. In Washington, two trillion dollars in cuts means that, over ten years, we will spend two trillion dollars less than we had previously intended to spend. This means that in ten years, our budget deficit will be 5.3 trillion dollars per year, instead of 5.5 trillion dollars per year.

This chart (from the CATO institute) shows that, what the spineless politicians call cuts, are really not cuts at all. The blue line shows the money that the Congressional Budget Office believed we would have spent over the next ten years. The red line shows the revised spending trajectory, after “saving” two trillion dollars. See how it still goes up? See how the up trajectory is almost the same as it would have with a "clean" debt ceiling increase? That is not a savings at all. That is the rough equivalent of buying a $98,000 Mercedes Benz instead of a $100,000 Mercedes Benz, when you cannot afford to buy any car at all, and calling it a "savings."