In this video, Penn and Teller explain the seven basic principles of magic: (1) palm, (2) ditch, (3) steal, (4) load, (5) simulate, (6) misdirect, and (7) switch.
I found this video to be not only amusing, but quite helpful as a guide to explaining the bewildering activities of our noble leaders these days. Up to now, I’ve been regarding the government’s activities, as well as the commentary of esteemed media experts such as Paul Krugman, to be the result of serious economic thinking. However, if one views all this as mere theatre, a sort of grotesque and fascinating vaudeville act, it renders it comprehensible.
Now, ladies and gentlemen - if I may have a drum roll, please - let us sit back and watch agape as The Amazing Federal Government makes our livelihoods, liberties, life savings, futures, and our children’s futures disappear...
“I look forward to working with Secretary Geithner and his team on the details of the Financial Stability Plan to produce for the American people a program that is more open, works better, produces more lending and reduces foreclosures,” writes House Financial Services Committee Chairman Barney Frank, as he deftly closes his fingers about the tens of billions of dollars of pocket change he has just liberated from taxpapers, with the caveat that “we need some assurance that, assuming this works as we hope it will, there will be more money available.”[Note 1.]
"‘My goodness, I can't stand here as a member of Congress and vote to release the second half of this money [i.e. $700 billion TARP bailout] without knowing what happened to the first half of it,’ said House Minority Leader John Boehner, R-Ohio.”[Note 2.]
“President George W. Bush signed into law an unprecedented $700 billion plan to rescue the U.S. financial system...”[Note 3.]
“President Obama has not ruled out a second stimulus package, his press secretary, Robert Gibbs, said on Tuesday, just before Mr. Obama signed his $787 billion recovery package into law...”[Note 4.]
"Our nation has come to expect the Federal Reserve to step in to avert events that pose unacceptable systemic risk," said former Treasury Secretary Henry Paulson. “We should quickly consider how to appropriately give the Fed the authority to access necessary information from highly complex financial institutions and the responsibility to intervene in order to protect the system.”[Note 5.]
"I do not think the Fed could fully meet these objectives [to promote ‘financial stability’] without the authority to directly examine banks and other financial institutions that are subject to prudential regulation," said Federal Reserve Chairman Ben Bernanke.[Note 6.]
“[T]he American Recovery and Reinvestment Act will start having an impact as soon as a few weeks from now, in the form of the quickest and broadest tax cut in history,” reports the White House blog.[Note 7.] (For the government to put $65 per month, on average, into the pockets of people who did not pay taxes in the first place is not a “tax cut,” even if the President knits his brow in great earnestness and uses convincing hand gestures while calling it a tax cut.)
“For years, too many Wall Street executives made imprudent and dangerous decisions, seeking profits with too little regard for risk, too little regulatory scrutiny, and too little accountability. Banks made loans without concern for whether borrowers could repay them...,” writes Mr. Obama, (without mentioning the explicit and implicit pressure exerted by the government to drive them to do so - from the FDIC, the Community Reinvestment Act, the actions of the Federal Reserve, compulsory accounting practices, etc., etc. To claim that there is too little regulatory scrutiny of business in America is a falsehood that at one time I would have believed to be too brazen and apparent to be uttered seriously by anyone other than a fictional villain in a novel.)[Note 8.]
“Aside from creating $787 billion in extra welfare costs, both versions of the ‘stimulus’ bill would abolish the historic welfare reform of the mid-1990’s that led to a dramatic reduction in welfare dependency and child poverty.”[Note 9.] (Under the cover of alleged “stimulus” spending, Democrats are now unrestrained in their expansion of the welfare state.)
“[Secretary Paulson’s proposed lending program], still in the planning stages, would for the first time use bailout funds specifically to help consumers instead of banks, savings and loans and Wall Street firms.”[Note 10.]
“President Bush and the Treasury Department signaled on Friday morning that they would consider dipping into the $700 billion bailout program for financial institutions to aid the Big Three car companies.”[Note 11.]
1. “Statement of Chairman Barney Frank in Reaction to Remarks Made by Treasury Secretary Geithner,” 11 Feb 2009, http://www.house.gov/frank/geithner021109.html.
2. Money News, “House Rejects Obama’s Request for More TARP Funds,” 23 Jan 2009, http://moneynews.newsmax.com/economy/tarp/2009/01/23/174498.html.
3. The Wall Street Journal, “Historic Bailout Passes as Economy Slips Further,” 4 Oct 2008, http://online.wsj.com/article/SB122304922742602533.html.
4. The New York Times, “Signing Stimulus, Obama Doesn’t Rule Out More,” 17 Feb 2009, http://www.nytimes.com/2009/02/18/us/politics/18web-stim.html?scp=2&sq=Obama%20signed%20stimulus&st=cse.
5. The Washington Post, “Paulson To Urge New Fed Powers,” 19 Jun 2008, http://www.washingtonpost.com/wp-dyn/content/article/2008/06/18/AR2008061803225.html?hpid=topnews.
6. MarketWatch, “Bernanke Seeks New Powers,” 8 Jul 2008, http://www.marketwatch.com/news/story/bernanke-seeks-new-regulatory-powers/story.aspx?guid=%7B7DFB82A4-1E02-4F50-B445-B8E68B8E0EFD%7D&dist=msr_1.
7. The White House Blog, “The quickest and broadest tax cut ever,” 21 Feb 2009, http://www.whitehouse.gov/blog/09/02/20/The-quickest-and-broadest-tax-cut-ever/.
8. The White House, “The President’s American Recovery and Reinvestment Plan,” 8 Jan 2009, http://www.whitehouse.gov/agenda/economy/.
9. The Heritage Foundation, “It Ain’t Over ‘Til It’s Over: Two Wrongs Don’t Make a Recovery,” http://www.heritage.org/research/economy/upload/Heritage_stimulus_spending_2_11.pdf.
10. The New York Times, “U.S. Shifts Focus in Credit Bailout to the Consumer,” 12 Nov 2008, http://www.nytimes.com/2008/11/13/business/economy/13bailout.html?scp=5&sq=Congress%20TARP&st=cse.
11. The New York Times, “White House Considers Using TARP for Auto Aid,” 12 Dec 2008, http://dealbook.blogs.nytimes.com/2008/12/12/white-house-considers-using-tarp-for-auto-aid/?scp=6&sq=Congress%20TARP&st=cse.