I’m always appreciative when a fellow says what he really means. Tim Flannery, the jet-setting doomsaying global warm-monger from down under, was in Ottawa the other day promoting his latest eco-tract, and offered a few thoughts on “Copenhagen”—which is transnational-speak for December’s UN Convention on Climate Change. “We all too often mistake the nature of those negotiations in Copenhagen,” remarked professor Flannery. “We think of them as being concerned with some sort of environmental treaty. That is far from the case. The negotiations now ongoing toward the Copenhagen agreement are in effect diplomacy at the most profound global level. They deal with every aspect of our life and they will in?uence every aspect of our life, our economy, our society.”

Hold that thought: “They deal with every aspect of our life.” Did you know every aspect of your life was being negotiated at Copenhagen? But in a good way! So no need to worry. After all, we all care about the environment, don’t we? So we ought to do something about it, right? And, since “the environment” isn’t just in your town or county but spreads across the entire planet, we can only really do something at the planetary level. But what to do? According to paragraph 38 on page 18 of the latest negotiating text, the convention will set up a “government” to manage the “new funds” and the “related facilitative processes.”

Tim Flannery’s disarmingly honest characterization passed almost without notice, reported as far as I can tell only by Brian Lilley of CFRB Toronto and CJAD Montreal. But professor Flannery has it right. Government transport policy is about transport, and government education policy is about education, but environmental policy is about everything, because everything’s part of “the environment”: your town, your county, your planet—and you. “We are the environment. There is no distinction,” declared another renowned expert, David Suzuki, last year. And just as the government now monitors air and water quality so it’s increasingly happy to regulate your quality.

In the name of “the environment,” the state gets to regulate everything you do. The cap-and-trade bill recently passed by the U.S. House of Representatives, for example, is a bold assault on property rights: in order to sell your home—whether built in 2006 or 1772—you would have to bring it into compliance with whimsical, eternally evolving national “energy ef?ciency” standards, starting with a 50 per cent reduction in energy use by 2018. Fail to do so and it would be illegal for you to enter into a private contract with a willing buyer.

Hey, but who would ever ?nd out?

Don’t be so sure. In 2006, to comply with the “European Land?ll Directive,” various municipal councils in England, Scotland and Northern Ireland introduced “smart” trash cans—“wheelie bins” with a penny-sized electronic chip embedded within that helpfully monitors and records your garbage as it’s tossed into the truck. Once upon a time, you had to be a double-0 agent with Her Majesty’s Secret Service to be able to install that level of high-tech spy gadgetry. But now any old low-level apparatchik from the municipal council can do it, all in the cause of a sustainable planet. So where’s the harm?

And once Big Brother’s in your trash can, why stop there? Our wheelie-bin sensors are detecting an awful lot of junk-food packaging in your garbage. Maybe you should be eating healthier. In Tokyo, Matsushita engineers have created a “smart toilet”: you sit down, and the seat sends a mild electric charge through your bottom that calculates your body/fat ratio, and then transmits the information to your doctors. Japan has a fast-aging population imposing unsustainable costs on its health system, so the state has an interest in tracking your looming health problems, and nipping them in the butt. In England, meanwhile, Twyford’s, whose founder invented the modern ceramic toilet in the 19th century, has developed an advanced model—the VIP (Versatile Interactive Pan)—that examines your urine and stools for medical problems and dietary content: if you’re not getting enough roughage, it automatically sends a signal to the nearest supermarket requesting a delivery of beans. All you have to do is sit there as your VIP toilet orders à la carte and prescribes your medication.

But think of the environmental bene?ts: readers may recall Sheryl Crow’s brief campaign to get people to use only one sheet of toilet paper (I recommended an all-star consciousness-raising single—“All we are saying is give one piece a chance”). Last month, the Washington Post reported a new front in this war. Two-ply bathroom tissue, according to Allen Hershkowitz of the Natural Resources Defense Council, “is the Hummer of the paper industry.” Oh, and blame Canada, as that’s where most American two-ply comes from: this decadent Dominion is apparently the House of Saud of toilet paper. In Britain, where closed-circuit cameras monitor you to check you’re not eating a sandwich while driving, is it such a stretch to foresee those toilet sensors that wire your stool analysis to the government health centre also snitching on your two-ply Cottonelle? Or perhaps, if it’s a Matsushita toilet, a few extra volts from the buttock-zapper will be enough of a warning.

“The environment” is the most ingenious cover story for Big Government ever devised. You ?oat a rumour that George W. Bush is checking up on what library books you’re reading, and everyone goes bananas. But announce that a government monitoring device has been placed in every citizen’s trash can in the cause of “saving the planet,” and the world loves you.

In 1785, the British philosopher Jeremy Bentham began working on his famous “Pan-opticon”—a radial prison in which a central “inspector” could see all the prisoners, but they could never see him. In the computer age, we now have not merely panopticon buildings, but panopticon societies, like modern London—and soon perhaps, excepting a few redoubts such as Waziristan and the livelier precincts of the Horn of Africa, a panopticon planet.

As cultural calamities go, there are worse fates than that of Iceland, which is losing all three of its McDonald's franchises, effective next weekend. But the Big Mac's departure from Iceland, a victim of the financial crisis that sent the currency into a tailspin, is nonetheless a suggestive economic indicator.

McDonald's Icelandic franchisee noted, in explaining his decision to throw in the patty, that unlike his local competitors, McDonald's imports most of its raw ingredients, from beef to special sauce, lettuce, cheese, pickles, onions and, we assume, sesame seed buns. This reliance on imports has undercut McDonald's margins in the island nation, which saw the krona plummet by more than 80% after the financial panic took down the country's major banks.

But the lesson here is not about the dangers of globalization or the virtues of buying local. Since Iceland's banks collapsed last fall, and its currency with them, the cost in local currency of all imports, and not just fast food, has soared. This has done nothing to "cushion" the blow to Iceland's economy from what amounted to an international run on its banks. What it has done is added a currency panic to a financial panic, and made Iceland's prospects bleaker than they otherwise might have been.

In countries such as Ireland, some critics of the euro have claimed that membership in the currency bloc has made its economic woes that much more painful, and that Ireland would have been better off if it could have depreciated its way out of trouble. In the U.S., too, there's a chorus arguing that we can devalue our way toward prosperity. But debasing one's currency makes a country poorer, not richer. Just ask the residents of Reykjavik, who now must travel 900 miles to get their Big Mac—in Dublin.

"Thank you. Thank you very much. Thank you and good evening. The sponsor has been identified, but unlike most television programs, the performer hasn't been provided with a script. As a matter of fact, I have been permitted to choose my own words and discuss my own ideas regarding the choice that we face in the next few weeks.

I have spent most of my life as a Democrat. I recently have seen fit to follow another course. I believe that the issues confronting us cross party lines. Now, one side in this campaign has been telling us that the issues of this election are the maintenance of peace and prosperity. The line has been used, "We've never had it so good."

But I have an uncomfortable feeling that this prosperity isn't something on which we can base our hopes for the future. No nation in history has ever survived a tax burden that reached a third of its national income. Today, 37 cents out of every dollar earned in this country is the tax collector's share, and yet our government continues to spend 17 million dollars a day more than the government takes in. We haven't balanced our budget 28 out of the last 34 years. We've raised our debt limit three times in the last twelve months, and now our national debt is one and a half times bigger than all the combined debts of all the nations of the world. We have 15 billion dollars in gold in our treasury; we don't own an ounce. Foreign dollar claims are 27.3 billion dollars. And we've just had announced that the dollar of 1939 will now purchase 45 cents in its total value.

As for the peace that we would preserve, I wonder who among us would like to approach the wife or mother whose husband or son has died in South Vietnam and ask them if they think this is a peace that should be maintained indefinitely. Do they mean peace, or do they mean we just want to be left in peace? There can be no real peace while one American is dying some place in the world for the rest of us. We're at war with the most dangerous enemy that has ever faced mankind in his long climb from the swamp to the stars, and it's been said if we lose that war, and in so doing lose this way of freedom of ours, history will record with the greatest astonishment that those who had the most to lose did the least to prevent its happening. Well I think it's time we ask ourselves if we still know the freedoms that were intended for us by the Founding Fathers.

Not too long ago, two friends of mine were talking to a Cuban refugee, a businessman who had escaped from Castro, and in the midst of his story one of my friends turned to the other and said, "We don't know how lucky we are." And the Cuban stopped and said, "How lucky you are? I had someplace to escape to." And in that sentence he told us the entire story. If we lose freedom here, there's no place to escape to. This is the last stand on earth.

And this idea that government is beholden to the people, that it has no other source of power except the sovereign people, is still the newest and the most unique idea in all the long history of man's relation to man.

This is the issue of this election: Whether we believe in our capacity for self-government or whether we abandon the American revolution and confess that a little intellectual elite in a far-distant capitol can plan our lives for us better than we can plan them ourselves.

You and I are told increasingly we have to choose between a left or right. Well I'd like to suggest there is no such thing as a left or right. There's only an up or down—[up] man's old—old-aged dream, the ultimate in individual freedom consistent with law and order, or down to the ant heap of totalitarianism. And regardless of their sincerity, their humanitarian motives, those who would trade our freedom for security have embarked on this downward course.

In this vote-harvesting time, they use terms like the "Great Society," or as we were told a few days ago by the President, we must accept a greater government activity in the affairs of the people. But they've been a little more explicit in the past and among themselves; and all of the things I now will quote have appeared in print. These are not Republican accusations. For example, they have voices that say, "The cold war will end through our acceptance of a not undemocratic socialism." Another voice says, "The profit motive has become outmoded. It must be replaced by the incentives of the welfare state." Or, "Our traditional system of individual freedom is incapable of solving the complex problems of the 20th century." Senator Fullbright has said at Stanford University that the Constitution is outmoded. He referred to the President as "our moral teacher and our leader," and he says he is "hobbled in his task by the restrictions of power imposed on him by this antiquated document." He must "be freed," so that he "can do for us" what he knows "is best." And Senator Clark of Pennsylvania, another articulate spokesman, defines liberalism as "meeting the material needs of the masses through the full power of centralized government."

Well, I, for one, resent it when a representative of the people refers to you and me, the free men and women of this country, as "the masses." This is a term we haven't applied to ourselves in America. But beyond that, "the full power of centralized government"—this was the very thing the Founding Fathers sought to minimize. They knew that governments don't control things. A government can't control the economy without controlling people. And they know when a government sets out to do that, it must use force and coercion to achieve its purpose. They also knew, those Founding Fathers, that outside of its legitimate functions, government does nothing as well or as economically as the private sector of the economy.

Now, we have no better example of this than government's involvement in the farm economy over the last 30 years. Since 1955, the cost of this program has nearly doubled. One-fourth of farming in America is responsible for 85 percent of the farm surplus. Three-fourths of farming is out on the free market and has known a 21 percent increase in the per capita consumption of all its produce. You see, that one-fourth of farming—that's regulated and controlled by the federal government. In the last three years we've spent 43 dollars in the feed grain program for every dollar bushel of corn we don't grow.

Senator Humphrey last week charged that Barry Goldwater, as President, would seek to eliminate farmers. He should do his homework a little better, because he'll find out that we've had a decline of 5 million in the farm population under these government programs. He'll also find that the Democratic administration has sought to get from Congress [an] extension of the farm program to include that three-fourths that is now free. He'll find that they've also asked for the right to imprison farmers who wouldn't keep books as prescribed by the federal government. The Secretary of Agriculture asked for the right to seize farms through condemnation and resell them to other individuals. And contained in that same program was a provision that would have allowed the federal government to remove 2 million farmers from the soil.

At the same time, there's been an increase in the Department of Agriculture employees. There's now one for every 30 farms in the United States, and still they can't tell us how 66 shiploads of grain headed for Austria disappeared without a trace and Billie Sol Estes never left shore.

Every responsible farmer and farm organization has repeatedly asked the government to free the farm economy, but how—who are farmers to know what's best for them? The wheat farmers voted against a wheat program. The government passed it anyway. Now the price of bread goes up; the price of wheat to the farmer goes down.

Meanwhile, back in the city, under urban renewal the assault on freedom carries on. Private property rights [are] so diluted that public interest is almost anything a few government planners decide it should be. In a program that takes from the needy and gives to the greedy, we see such spectacles as in Cleveland, Ohio, a million-and-a-half-dollar building completed only three years ago must be destroyed to make way for what government officials call a "more compatible use of the land." The President tells us he's now going to start building public housing units in the thousands, where heretofore we've only built them in the hundreds. But FHA [Federal Housing Authority] and the Veterans Administration tell us they have 120,000 housing units they've taken back through mortgage foreclosure. For three decades, we've sought to solve the problems of unemployment through government planning, and the more the plans fail, the more the planners plan. The latest is the Area Redevelopment Agency.

They've just declared Rice County, Kansas, a depressed area. Rice County, Kansas, has two hundred oil wells, and the 14,000 people there have over 30 million dollars on deposit in personal savings in their banks. And when the government tells you you're depressed, lie down and be depressed.

We have so many people who can't see a fat man standing beside a thin one without coming to the conclusion the fat man got that way by taking advantage of the thin one. So they're going to solve all the problems of human misery through government and government planning. Well, now, if government planning and welfare had the answer—and they've had almost 30 years of it—shouldn't we expect government to read the score to us once in a while? Shouldn't they be telling us about the decline each year in the number of people needing help? The reduction in the need for public housing?

But the reverse is true. Each year the need grows greater; the program grows greater. We were told four years ago that 17 million people went to bed hungry each night. Well that was probably true. They were all on a diet. But now we're told that 9.3 million families in this country are poverty-stricken on the basis of earning less than 3,000 dollars a year. Welfare spending [is] 10 times greater than in the dark depths of the Depression. We're spending 45 billion dollars on welfare. Now do a little arithmetic, and you'll find that if we divided the 45 billion dollars up equally among those 9 million poor families, we'd be able to give each family 4,600 dollars a year. And this added to their present income should eliminate poverty. Direct aid to the poor, however, is only running only about 600 dollars per family. It would seem that someplace there must be some overhead.

Now—so now we declare "war on poverty," or "You, too, can be a Bobby Baker." Now do they honestly expect us to believe that if we add 1 billion dollars to the 45 billion we're spending, one more program to the 30-odd we have—and remember, this new program doesn't replace any, it just duplicates existing programs—do they believe that poverty is suddenly going to disappear by magic? Well, in all fairness I should explain there is one part of the new program that isn't duplicated. This is the youth feature. We're now going to solve the dropout problem, juvenile delinquency, by reinstituting something like the old CCC camps [Civilian Conservation Corps], and we're going to put our young people in these camps. But again we do some arithmetic, and we find that we're going to spend each year just on room and board for each young person we help 4,700 dollars a year. We can send them to Harvard for 2,700! Course, don't get me wrong. I'm not suggesting Harvard is the answer to juvenile delinquency.

But seriously, what are we doing to those we seek to help? Not too long ago, a judge called me here in Los Angeles. He told me of a young woman who'd come before him for a divorce. She had six children, was pregnant with her seventh. Under his questioning, she revealed her husband was a laborer earning 250 dollars a month. She wanted a divorce to get an 80 dollar raise. She's eligible for 330 dollars a month in the Aid to Dependent Children Program. She got the idea from two women in her neighborhood who'd already done that very thing.

Yet anytime you and I question the schemes of the do-gooders, we're denounced as being against their humanitarian goals. They say we're always "against" things—we're never "for" anything.

Well, the trouble with our liberal friends is not that they're ignorant; it's just that they know so much that isn't so.

Now—we're for a provision that destitution should not follow unemployment by reason of old age, and to that end we've accepted Social Security as a step toward meeting the problem.

But we're against those entrusted with this program when they practice deception regarding its fiscal shortcomings, when they charge that any criticism of the program means that we want to end payments to those people who depend on them for a livelihood. They've called it "insurance" to us in a hundred million pieces of literature. But then they appeared before the Supreme Court and they testified it was a welfare program. They only use the term "insurance" to sell it to the people. And they said Social Security dues are a tax for the general use of the government, and the government has used that tax. There is no fund, because Robert Byers, the actuarial head, appeared before a congressional committee and admitted that Social Security as of this moment is 298 billion dollars in the hole. But he said there should be no cause for worry because as long as they have the power to tax, they could always take away from the people whatever they needed to bail them out of trouble. And they're doing just that.

A young man, 21 years of age, working at an average salary—his Social Security contribution would, in the open market, buy him an insurance policy that would guarantee 220 dollars a month at age 65. The government promises 127. He could live it up until he's 31 and then take out a policy that would pay more than Social Security. Now are we so lacking in business sense that we can't put this program on a sound basis, so that people who do require those payments will find they can get them when they're due—that the cupboard isn't bare?

Barry Goldwater thinks we can.

At the same time, can't we introduce voluntary features that would permit a citizen who can do better on his own to be excused upon presentation of evidence that he had made provision for the non-earning years? Should we not allow a widow with children to work, and not lose the benefits supposedly paid for by her deceased husband? Shouldn't you and I be allowed to declare who our beneficiaries will be under this program, which we cannot do? I think we're for telling our senior citizens that no one in this country should be denied medical care because of a lack of funds. But I think we're against forcing all citizens, regardless of need, into a compulsory government program, especially when we have such examples, as was announced last week, when France admitted that their Medicare program is now bankrupt. They've come to the end of the road.

In addition, was Barry Goldwater so irresponsible when he suggested that our government give up its program of deliberate, planned inflation, so that when you do get your Social Security pension, a dollar will buy a dollar's worth, and not 45 cents worth?

I think we're for an international organization, where the nations of the world can seek peace. But I think we're against subordinating American interests to an organization that has become so structurally unsound that today you can muster a two-thirds vote on the floor of the General Assembly among nations that represent less than 10 percent of the world's population. I think we're against the hypocrisy of assailing our allies because here and there they cling to a colony, while we engage in a conspiracy of silence and never open our mouths about the millions of people enslaved in the Soviet colonies in the satellite nations.

I think we're for aiding our allies by sharing of our material blessings with those nations which share in our fundamental beliefs, but we're against doling out money government to government, creating bureaucracy, if not socialism, all over the world. We set out to help 19 countries. We're helping 107. We've spent 146 billion dollars. With that money, we bought a 2 million dollar yacht for Haile Selassie. We bought dress suits for Greek undertakers, extra wives for Kenya[n] government officials. We bought a thousand TV sets for a place where they have no electricity. In the last six years, 52 nations have bought 7 billion dollars worth of our gold, and all 52 are receiving foreign aid from this country.

No government ever voluntarily reduces itself in size. So governments' programs, once launched, never disappear.

Actually, a government bureau is the nearest thing to eternal life we'll ever see on this earth.

Federal employees—federal employees number two and a half million; and federal, state, and local, one out of six of the nation's work force employed by government. These proliferating bureaus with their thousands of regulations have cost us many of our constitutional safeguards. How many of us realize that today federal agents can invade a man's property without a warrant? They can impose a fine without a formal hearing, let alone a trial by jury? And they can seize and sell his property at auction to enforce the payment of that fine. In Chico County, Arkansas, James Wier over-planted his rice allotment. The government obtained a 17,000 dollar judgment. And a U.S. marshal sold his 960-acre farm at auction. The government said it was necessary as a warning to others to make the system work.

Last February 19th at the University of Minnesota, Norman Thomas, six-times candidate for President on the Socialist Party ticket, said, "If Barry Goldwater became President, he would stop the advance of socialism in the United States." I think that's exactly what he will do.

But as a former Democrat, I can tell you Norman Thomas isn't the only man who has drawn this parallel to socialism with the present administration, because back in 1936, Mr. Democrat himself, Al Smith, the great American, came before the American people and charged that the leadership of his Party was taking the Party of Jefferson, Jackson, and Cleveland down the road under the banners of Marx, Lenin, and Stalin. And he walked away from his Party, and he never returned til the day he died—because to this day, the leadership of that Party has been taking that Party, that honorable Party, down the road in the image of the labor Socialist Party of England.

Now it doesn't require expropriation or confiscation of private property or business to impose socialism on a people. What does it mean whether you hold the deed to the—or the title to your business or property if the government holds the power of life and death over that business or property? And such machinery already exists. The government can find some charge to bring against any concern it chooses to prosecute. Every businessman has his own tale of harassment. Somewhere a perversion has taken place. Our natural, unalienable rights are now considered to be a dispensation of government, and freedom has never been so fragile, so close to slipping from our grasp as it is at this moment.

Our Democratic opponents seem unwilling to debate these issues. They want to make you and I believe that this is a contest between two men—that we're to choose just between two personalities.

Well what of this man that they would destroy—and in destroying, they would destroy that which he represents, the ideas that you and I hold dear? Is he the brash and shallow and trigger-happy man they say he is? Well I've been privileged to know him "when." I knew him long before he ever dreamed of trying for high office, and I can tell you personally I've never known a man in my life I believed so incapable of doing a dishonest or dishonorable thing.

This is a man who, in his own business before he entered politics, instituted a profit-sharing plan before unions had ever thought of it. He put in health and medical insurance for all his employees. He took 50 percent of the profits before taxes and set up a retirement program, a pension plan for all his employees. He sent monthly checks for life to an employee who was ill and couldn't work. He provides nursing care for the children of mothers who work in the stores. When Mexico was ravaged by the floods in the Rio Grande, he climbed in his airplane and flew medicine and supplies down there.

An ex-GI told me how he met him. It was the week before Christmas during the Korean War, and he was at the Los Angeles airport trying to get a ride home to Arizona for Christmas. And he said that [there were] a lot of servicemen there and no seats available on the planes. And then a voice came over the loudspeaker and said, "Any men in uniform wanting a ride to Arizona, go to runway such-and-such," and they went down there, and there was a fellow named Barry Goldwater sitting in his plane. Every day in those weeks before Christmas, all day long, he'd load up the plane, fly it to Arizona, fly them to their homes, fly back over to get another load.

During the hectic split-second timing of a campaign, this is a man who took time out to sit beside an old friend who was dying of cancer. His campaign managers were understandably impatient, but he said, "There aren't many left who care what happens to her. I'd like her to know I care." This is a man who said to his 19-year-old son, "There is no foundation like the rock of honesty and fairness, and when you begin to build your life on that rock, with the cement of the faith in God that you have, then you have a real start." This is not a man who could carelessly send other people's sons to war. And that is the issue of this campaign that makes all the other problems I've discussed academic, unless we realize we're in a war that must be won.

Those who would trade our freedom for the soup kitchen of the welfare state have told us they have a utopian solution of peace without victory. They call their policy "accommodation." And they say if we'll only avoid any direct confrontation with the enemy, he'll forget his evil ways and learn to love us. All who oppose them are indicted as warmongers. They say we offer simple answers to complex problems. Well, perhaps there is a simple answer—not an easy answer—but simple: If you and I have the courage to tell our elected officials that we want our national policy based on what we know in our hearts is morally right.

We cannot buy our security, our freedom from the threat of the bomb by committing an immorality so great as saying to a billion human beings now enslaved behind the Iron Curtain, "Give up your dreams of freedom because to save our own skins, we're willing to make a deal with your slave masters." Alexander Hamilton said, "A nation which can prefer disgrace to danger is prepared for a master, and deserves one." Now let's set the record straight. There's no argument over the choice between peace and war, but there's only one guaranteed way you can have peace—and you can have it in the next second—surrender.

Admittedly, there's a risk in any course we follow other than this, but every lesson of history tells us that the greater risk lies in appeasement, and this is the specter our well-meaning liberal friends refuse to face—that their policy of accommodation is appeasement, and it gives no choice between peace and war, only between fight or surrender. If we continue to accommodate, continue to back and retreat, eventually we have to face the final demand—the ultimatum. And what then—when Nikita Khrushchev has told his people he knows what our answer will be? He has told them that we're retreating under the pressure of the Cold War, and someday when the time comes to deliver the final ultimatum, our surrender will be voluntary, because by that time we will have been weakened from within spiritually, morally, and economically. He believes this because from our side he's heard voices pleading for "peace at any price" or "better Red than dead," or as one commentator put it, he'd rather "live on his knees than die on his feet." And therein lies the road to war, because those voices don't speak for the rest of us.

You and I know and do not believe that life is so dear and peace so sweet as to be purchased at the price of chains and slavery. If nothing in life is worth dying for, when did this begin—just in the face of this enemy? Or should Moses have told the children of Israel to live in slavery under the pharaohs? Should Christ have refused the cross? Should the patriots at Concord Bridge have thrown down their guns and refused to fire the shot heard 'round the world? The martyrs of history were not fools, and our honored dead who gave their lives to stop the advance of the Nazis didn't die in vain. Where, then, is the road to peace? Well it's a simple answer after all.

You and I have the courage to say to our enemies, "There is a price we will not pay." "There is a point beyond which they must not advance." And this—this is the meaning in the phrase of Barry Goldwater's "peace through strength." Winston Churchill said, "The destiny of man is not measured by material computations. When great forces are on the move in the world, we learn we're spirits—not animals." And he said, "There's something going on in time and space, and beyond time and space, which, whether we like it or not, spells duty."

You and I have a rendezvous with destiny.

We'll preserve for our children this, the last best hope of man on earth, or we'll sentence them to take the last step into a thousand years of darkness.

We will keep in mind and remember that Barry Goldwater has faith in us. He has faith that you and I have the ability and the dignity and the right to make our own decisions and determine our own destiny.

Thank you very much."

- Ronald Reagan (1964)

Run don't walk to the nearest library or bookstore. Get everything that you can on the Weimar Republic between 1917 and 1933 and Mugabe's Zimbabwe. You cannot just print money and expect everything to be okay. After hyperinflation, Weimar collapsed. In July, the inflation rate in Zimbabwe was 231mn%. A loaf of bread cost $300bn ZD. The first $100tn ZD has just been released.

We are already broke. You don't borrow trillions if you are solvent. 

The US GDP in a good year is $14tn.

In 2019, the national debt will be $22tn.

Your current share of the national debt is $344,000.

We are projected to have $1tn+ deficits every year for the next decade and this is without ObamaCare.

Due to bailouts under both Bush and Obama, we have given financial institutions and others $23.7tn. Our exposure for the credit default swaps that originated during the Clinton administration is 30 - 40 times GDP.

At the end of 2008, the Treasury had $800bn cash on hand. It is now $1.7tn in the red.

The Treasury has sold $7tn in paper this year.

For the second time during Obama's short presidency, Congress is set to increase the debt ceiling to $13tn.

The dollar is collapsing.  For example, the USD today (10.28.09) is worth $0.63 of one 1995 USD.

Gold, the traditional hedge against inflation, is at an all-time high.

In the Spring, Moody's downgraded "munis" (municipal bonds) to junk status.  Six months ago, Moody's predicted that the US would lose its AAA credit rating in 10 years.  Now, it predicts that we will lose it in 3-5 years.

For the second time in the Obama Administration, Congress in preparing to vote for another increase in the debt ceiling.  The new debt ceiling will be $13tn.

Now, I bet that you are thinking (well, some of you) that the "evil" rich should have their wealth confiscated because that would solve the problem.  If real life were only that simple...  The fact is that you could confiscate EVERYTHING from the wealthy and you still wouldn't be able to change the course so that the USS United States could avoid hitting the iceberg.

One year ago, 100% of the wealth in the US was controlled by the private sector.  William Boyes, an economics professor at the W.P. Carey School of Business at Arizona State University, estimates that the government now owns or controls businesses that generate about one-third of U.S. economic activity.  ONE-THIRD.

Want some more? OK.

Unfunded mandates for Social Security, Medicare, etc., are currently in excess of $113tn+.

And, then add:

China holds $1tn of our debt.
Japan holds $1tn of our debt.
The ME holds $1tn+ of our debt.
The EU holds $1tn of our debt.
Private and institutional investors around the world hold TRILLIONS of our debt.

And, then add:

Among the trillions that the Federal Reserve printed this year, $600bn was given to financial institutions to purchase Treasuries, which the Federal Reserve then purchased from them. This is debt monetization. Weimar is a perfect example of what happens when you have to eat your body to quiet your hunger pains.

Want even more?  Are you sure?  Alright, then...

Now, that it has been established that financial institutions have received TRILLIONS of dollars, the Federal Reserve must find a way and identify the time to "pop the clutch", i.e., begin withdrawal of the excess currency.  It does this by raising interest rates.  The more interest that you pay, the more currency is removed from the system.   In the 1970s, the Federal Reserve increased the money supply by 13%, which prompted inflation to rise to 21.5%.  In the last 13 months, the Federal Reserve has increased the money supply by 120%.  When it comes, will inflation be 15%?  20%?  25?  30?  Higher?  Who knows, but once begun, hyperinflation is nearly impossible to stop.  One thing is for certain.  The USD, which is not backed by gold or other hard assets, is becoming as worthless as the paper that it is written on and this renders our country impotent and broken. 

If the dollar were to completely collapse, the US would have to apply to the IMF, the World Bank and the United Nations for a "bailout".  As we have seen with TARP, money always comes with strings.  The financial institutions had to cede some of their autonomy to the Federal government.  The World will demand some of our sovereignty.  We have a recent example of this in the UK.  The UK, whose treasury was nearly empty and debt monetization had been ongoing, lost its AAA credit rating and had to appeal to the IMF for help.  Apart from shocking British politicians by telling them that the UK would now have to charge patients for their "free" healthcare, the IMF began to lay the framework for the UK to abandon the £ (Pound Sterling) and submit to the EU's economic requirements and adopt the € (euro).   The UK lost a great deal of its sovereignty.

We cannot print, borrow and tax our way out of this, especially if our government continues to spend like proverbial "drunken sailor."

Say, "Hello", to the Weimar for me.

Recently, an environmental adviser to PM Gordon Brown said that the population of the UK must be cut in half.  It seems that there are a lot of Hitler wannabees.  Consider this except"

Time for another selection of Classic Sentences from the Guardian's sister paper, the Observer.

"Fewer British babies would mean a fairer planet."

So barks the headline of Alex Renton’s latest exercise in ecological hair-tearing. Yes, I know what you’re thinking. It’s just another overexcited sub-editor and not representative of an otherwise measured and sober article. However, the first line reads,

"The worst thing that you or I can do for the planet is to have children."

And besides,

"One less British child would permit some 30 women in sub-Saharan Africa to have a baby and still leave the planet a cleaner place."

It continues,

"Why not start cutting population everywhere? Are condoms not the greenest technology of all?"

Inevitably, we veer tantalisingly close to China’s state reproduction policy:

"It was certainly the most successful governmental attempt to preserve the world’s resources so far."

And there’s this little gem.

"A cull of Australians or Americans would be at least 60 times as productive as one of Bangladeshis."

So several candidates there – from, lest we forget, a progressive and liberal newspaper.

I suspect Alex Renton measures his moral and intellectual sophistication by the extent to which he loathes his own culture, and by extension himself. Happily, he’s found a cause well suited to the cultivation of such feelings. Less happily, he presumes to share his leanings with others, coercively if necessary:

"Could children perhaps become part of an adult’s personal carbon allowance? Could you offer rewards: have one child only and you may fly to Florida once a year?"


Why do we need ObamaCare?  It would seem that it contradicts their stated goal of population decrease.

Libs:  Save the planet.  Kill yourselves.

Weakness in the economy and financial markets -- and the government's response to them -- have contributed to near-term increases in federal deficits, which reached record level in fiscal year 2009.  While a lot of attention has been given to the recent fiscal deterioration, the federal government faces even larger fiscal challenges that will persist long after the return of financial stability and economic growth.

...the federal government is on an unsustainable fiscal path.

The recent publicly announced Federal Budget Deficit for 2009 is widely reported to be $1.4 trillion.

This figure is inaccurate. Why? Because the Government made an "accounting change".

http://newsbusters.org/blogs/tom-blumer/2009/10/23/year-end -deficit-report-part-2-aps-crutsinger-misses-year-going-gal t

The real deficit is easily determined.

Thanks to a convenient web page maintained by the Treasury Department, you can access the National Debt data for any day, or range of days.

http://www.treasurydirect.gov/NP/BPDLogin?application=np

I chose the range Oct. 1, 2008 to Sept. 30, 2009. The government's fiscal year starts on Oct. 1 each year and ends on Sept. 30.

On Oct. 1, 2008, the National Debt was $10,124,225,067,127.69. On Sept. 30, 2009 the debt was $11,909,829,003,511.75. Subtract the two and voila! Do you get the $1.4 trillion dollar figure? Nope.

Our National Debt has increased not by "only" $1 trillion under President Obama, but has actually increased by over $1.3 trillion.

The media should report the actual figure, not the "adjusted" figure and report that the $1.4 trillion is an adjusted figure every time they use that number.

Of course, these figures don't reflect the unfunded liabilities of over $100 trillion for Medicaid, Medicare and Social Security. That's a story for another happy day.

The eco-pawprint of a pet dog is twice that of a 4.6-litre Land Cruiser driven 10,000 kilometres a year, researchers have found.

Victoria University professors Brenda and Robert Vale, architects who specialise in sustainable living, say pet owners should swap cats and dogs for creatures they can eat, such as chickens or rabbits, in their provocative new book Time to Eat the Dog: The real guide to sustainable living.

The couple have assessed the carbon emissions created by popular pets, taking into account the ingredients of pet food and the land needed to create them.

“If you have a German shepherd or similar-sized dog, for example, its impact every year is exactly the same as driving a large car around,” Brenda Vale said.

“A lot of people worry about having SUVs but they don’t worry about having Alsatians and what we are saying is, well, maybe you should be because the environmental impact … is comparable.”

In a study published in New Scientist, they calculated a medium dog eats 164 kilograms of meat and 95kg of cereals every year. It takes 43.3 square metres of land to produce 1kg of chicken a year. This means it takes 0.84 hectares to feed Fido.

They compared this with the footprint of a Toyota Land Cruiser, driven 10,000km a year, which uses 55.1 gigajoules (the energy used to build and fuel it). One hectare of land can produce 135 gigajoules a year, which means the vehicle’s eco-footprint is 0.41ha – less than half of the dog’s.

They found cats have an eco-footprint of 0.15ha – slightly less than a Volkswagen Golf. Hamsters have a footprint of 0.014ha – keeping two of them is equivalent to owning a plasma TV.

Tastes like chicken.

Among the natural rights of the colonists are these: First a right to life, secondly to liberty, and thirdly to property; together with the right to defend them in the best manner they can.

He who is void of virtuous attachments in private life is, or very soon will be, void of all regard for his country. There is seldom an instance of a man guilty of betraying his country, who had not before lost the feeling of moral obligations in his private connections.

How strangely will the Tools of a Tyrant pervert the plain Meaning of Words!

It does not require a majority to prevail, but rather an irate, tireless minority keen to set brush fires in people's minds.

It does not take a majority to prevail... but rather an irate, tireless minority, keen on setting brushfires of freedom in the minds of men.

Mankind are governed more by their feelings than by reason.

Our contest is not only whether we ourselves shall be free, but whether there shall be left to mankind an asylum on earth for civil and religious liberty.

The Constitution shall never be construed... to prevent the people of the United States who are peaceable citizens from keeping their own arms.

The liberties of our country, the freedom of our civil constitution, are worth defending against all hazards: And it is our duty to defend them against all attacks.

The natural liberty of man is to be free from any superior power on Earth, and not to be under the will or legislative authority of man, but only to have the law of nature for his rule.

We cannot make events. Our business is wisely to improve them.

“The alternate domination of one faction over another, sharpened by the spirit of revenge, natural to party dissension, which in different ages and countries has perpetrated the most horrid enormities, is itself a frightful despotism. But this leads at length to a more formal and permanent despotism. The disorders and miseries which result gradually incline the minds of men to seek security and repose in the absolute power of an individual; and sooner or later the chief of some prevailing faction, more able or more fortunate than his competitors, turns this disposition to the purposes of his own elevation, on the ruins of public liberty.” - George Washington’s Farewell Address

"To take from one, because it is thought that his own industry and that of his fathers has acquired too much, in order to spare others, who, or whose fathers have not exercised equal industry and skill, is to violate arbitrarily the first principle of association, 'the guarantee to every one of a free exercise of his industry, and the fruits acquired by it.'" - Thomas Jefferson

“Perhaps the fact that we have seen millions voting themselves into complete dependence on a tyrant has made our generation understand that to choose one's government is not necessarily to secure freedom.” - Friedrich August Von Hayek

"One of the consequences of such notions as entitlements is that people who have contributed nothing to society feel that society owes them something, apparently just for being nice enough to grace us with their presence." - Thomas Sowell

"A government policy to rob Peter to pay Paul can be assured of the support of Paul." - George Bernard Shaw

"It is a socialist ideal that making profits is a vice. I consider the real vice is making losses." - Winston Churchill

"Democracy and socialism have nothing in common but one word, equality. But notice the difference: while democracy seeks equality in liberty, socialism seeks equality in restraint and servitude." - Alexis de Tocqueville

"Men must be governed by God or they will be ruled by tyrants." - William Penn

You don’t have to hate America to want to give it universal health care coverage, but it sure helps.

If you want to attack America, why bother wasting value munitions when it’s so much easier to destroy its economy with cap-and-trade legislation and devastate its citizen’s health with socialized medicine?

Self-interest is what motivates people in the American health care industry to produce better goods and services. But without the potential for profit because of Obama’s socialist medical system, the quality of American health care is sure to deteriorate.

Currently America’s private health care is superior to Europe’s socialized medicine. For example, Americans have better survival rates for 13 of the 16 most common forms of cancer. For American men, 91.9 percent live through having prostate cancer. In France the prostate cancer survivor rate is only 73.7 percent, and in England it’s a mere 51.1 percent.

Today there are a million Britons waiting to be admitted to a hospital, and every year the British NHS cancels 100,000 of their operations. If European socialized medicine is so great, why did the prime minister of Italy come to the Cleveland Clinic to have his open-heart surgery?

Canada is even worse. Of its 33 million citizens, 800,000 are on hospital waiting lists for 18 weeks. John Stossel reports on ABC’s “20/20” that health care is so scarce in Canada that one town has a monthly lottery to see which lucky family can get a family doctor.

There is, though, one area in Canada where private health care does offer innovation and fast treatment. It provides easy access to cutting edge technology, available 24/7. A CT scan can be done the next day. Operations are scheduled within a week. The only problem is that you have to be someone’s pet to get this level of care. It’s available only from Canadian veterinarians.

In Italy, the average wait time for breast cancer surgery is 6+ months. If you have money, you can have surgery in 5 or 6 DAYS.

If our elected officials were genuinely concerned about you, they’d pass legislation to allow you to buy your own health care insurance. Instead they’re getting ready to impose socialized medicine on you. Basic economics tells you the cost will go up, the quality will go down, and the only ones to benefit will be the greedy politicians.

That economic truth was reconfirmed by the Congressional Budget Office on Friday (July 17) when it reported the destructive cost of Obama’s socialist health care plan. And, 87% of the costs for BaucusCare will be borne by those earning between $40,000 and $200,000. Just another "Read my lips" broken promise by Obama.

During the 1960s the evening news daily carried the body count of the Vietnam War. I wonder who’ll now report on the daily body count caused by Obama’s socialized medicine.

Leftists want big government and huge entitlement programs, but they also want population control so as to "save" the planet. You cannot have both. In order to pay for the government, you must have enough young people paying taxes so that the older people can be taken care of in any society. For a population to sustain itself, the birth rate must be 2.1, i.e., the number of children born to each woman. In the US, we are at 2.1, but most developed countries are much lower than that. For example, Spain and Italy have a birth rate number around 1.2. This means that the population will half itself in every successive generation. Canada, the UK, France, and other European countries are slightly better, but still well below the US.  In Japan, which has the lowest birth rate in the world, the population is actually not being replenished.  2005 marked the first time that more died than were born.  On Obi Island, for example, which has a population of ~20,000, there is not a single obstetrician.  One flies in for a few hours on a single day per week.  Additionally, more medical students are opting to practice geriatrics than obstetrics.  The only way these countries can survive is through immigration from countries like Yemen, Afghanistan and other predominantly Muslim countries where their most abundant resource is their population. Even Iran, the Gaza Strip and West Bank are better positioned than Europe and the US. 60% of the population is under the age of 30 in Iran and the median age of Palestinians is 15.8 years. Muslim countries will export their most "important" resource, but this will complicate matters in Western countries. As is quite evident in France, the Netherlands, the UK, and Scandinavia, the Muslim community fails to integrate and is also much more dependent on social welfare programs.

Let's look at birth rates in the Western world and compare with Muslim countries:

According to the UN's most recent population report has revised the global fertility rate down from 2.1, i.e., the replacement rate, to 1.85, i.e., eventual population decline.

Those who dismiss the US' comparatively robust demographics say they reflect nothing more than the fecundity of Hispanic immigration--it's the legions of the  undocumented who are filling the maternity wards.  In fact, white women in America still breed at a greater rate, i.e., 1.85 or so, than white women in Canada or Europe.

In Afghanistan in 2005, the rate of births per 1,000 people in the country was 47.02.  In Albania in 2005, the rate of births per 1,000 people in the country was 15.08.

Global fertility rates show that Niger is the leader with 7.46.  Mali is 7.42.  Somalia is 6.76.  Yemen 6.58.  On the other hand, the US is 2.11.  New Zealand is just below the US.  Ireland is 1.9.  Australia is 1.7.  Canada is 1.5, which is well below the replacement rate.  Germany and Austria are at 1.3, which is the brink of the death cycle.  Russia and Italy are at 1.2.  (In Russia, 70% of all pregnancies end in abortion),  Spain is 1.1 (half the replacement rate).  Clearly, Muslims are multiplying much faster than the Western world.

Now, let's look at birth rates and economic liberty:

Taking the fourteen core pre-expansion EU economies, four of the five countries that also scored highest for economic freedom:  Ireland, Denmark, Finland, and the Netherlands.  The fifth highest fertility rate (1.89) belongs to France, which has one of the lowest rankings on economic freedom.  But France is also the country with the highest Islamic population, and the evidence suggests that a third of all births there are already Muslim.  If one were to adjust accordingly, you could make a case for close correlation in Europe between economic freedom and fertility rates.  The three lowest birth rates belong to the countries at the bottom of the economic-liberty indicators:  Greece, Italy and Spain.  On the other hand, in the rest of the world, territories with high  economic liberty--Hong Kong, Singapore--are nose-diving into the demographic asphalt.  So how about the marriage rate?

Key:  MR (marriage rate), FR (total fertility rate)

US:  MR 11.7 and FR 2.11
Denmark: MR 10.4 and FR 1.77
Netherlands:  MR 7.7 and FR 1.72
UK:  MR 7.3 and FR 1.6
France:  MR 7.2 and FR 1.89
Germany:  MR 7.1 and FR 1.35
Italy:  MR 6.9 and FR 1.23

That's close enough to suggest that, when your tax and social policies encourage non-traditional family models, one consequence is fewer children.  Yet again, though, that doesn't apply to Japan, which still has a higher marriage rate than most European countries.

Or maybe it's speaking in English.  In the core "Western World," compare the Anglo-Celtic-settled Anglophone democracies with the rest of the G-8:

US:  2.11
New Zealand:  2.01
Ireland:  1.9
Australia:  1.7
UK:  1.6
Canada:  1.48
France:  1.89
EU Avg.:  1.38
Germany:  1.35
Japan:  1.32
Italy:  1.23
Russia:  1.14

Or maybe it's already the Muslim populations that are keeping European maternity wards going.  Insofar as one can penetrate the multiculti obfuscation on the issue, the five Continental nations (excerpting war-ravaged Bosnia) with highest proportion of Muslim citizens are also the five Continental nations with the highest fertility rates--Albania, Macedonia, France, the Netherlands, and Denmark.

Now, while the US and Canada, pour le plus part, have much in common, the fertility rates are vastly different:  America's marriage rate per 1,000 is 11.7 and Canada's is 6.8.  In the Queen's chilly Dominion, straights live in common-law partnerships and the gays get married.  And, the upshot is that American's fertility rate is 2.11 while Canada's is only 1.48.

And, where does that lead?  Canucks are aging faster that the Yanks.  In 2000, oldsters formed 16.3% of American's population and 17% of Canada's--close enough.  In 2040, they will form 26% of America's population and 33.3% of Canada's.  And, there will be a lot fewer young Canadians to stick with the bill for increased geriatric care.

Across the developed world, we're at the beginning of the end of the social-democratic state.  The surest way to be in the demographic death spiral is to be a former Communist country in Europe:  the five lowest birth rates in the world are Latvia, Bulgaria, Slovenia, Russia and Ukraine.  But, the next surest way is just to be in Europe:  19 of the lowest 20 birth rates in the world are on the Continent (the 20th is Japan).  Conversely, the only advanced nation with sizeable population reproducing at replacement is the US, with Red States doing the "labor."

But the fact remains:  Europe is dying and the US is not, at least not yet.

In the US, we are seeing the result of our decline in population growth in the Social Security crisis.  Next year, SS will take in less money than it will pay out to retirees.  Further, the number of retirees will double in 10 years without a corresponding increase in the number of persons employed.  Most economists acknowledge, that even if job creation rose to the level seen in the 1990s, it would be 2017 before the unemployment level fell below 5%.  Too many are living on the labors of too few.

Europe's welfare and entitlement programs are lavishly and outrageously expensive.  The tax rates of countries in the EU are the highest in the world, but as the workers become older, there will be far fewer producers to pay the taxes which pay for the programs on which the aged depend.  While Europe may find itself beyond the point of return in 25 years, the US has more time; yet, we will quickly be faced with the crisis that the EU is experiencing now so that by 2050 our producers will not contribute enough to sustain the non-producers.  If the top 5% of American earners pay 70% of the Federal taxes and the middle class only pays 3%, how long can the country continue as a world power?  There are not enough “evil” rich to pay for our expanding government now.  Just imagine how untenable the situation will be in even 20 years.

The strain on the USD will grow ever more dire as our safety net and entitlement programs expand.  As it is, 60% of the Federal budget is used to pay Social Security, Medicare, and Medicaid.  Literally, we are borrowing money to pay, not for infrastructure, which would be a good investment, but for the entitlements of those who have outlived (and, I don't say that in a negative sense) their productivity as far as their contributions to the tax base are concerned.

Consider the irony, the very ecochondriacs that are worried about the end of the world due to "climate change" are the ones that insist on the largest entitlement programs. Additionally, the population that will step in to fill the void caused by dwindling populations in the West are uninterested in the environment and persecute women and homosexuals.

This is the real “population bomb”, not the one about which Erlich wrote in the 1960s.

The dollar's sharp drop over the past few weeks has led to considerable anxiety about the status of the United States as the dominant force in the global economy. Closely related to this fear is constant worry about the rise of China and the evermore complicated relationship between Beijing and Washington.

Most people are now aware that China is the largest creditor to a heavily indebted U.S. government. It holds close to a trillion dollars of U.S. Treasurys and has invested hundreds of billions more in private enterprises in America. Even though these facts are plainly acknowledged, policy makers and experts continue to underestimate the full ramifications of this relationship.

Consider what happened in 1946, when a cash-strapped Great Britain turned to the U.S. for a loan. For 30 years or more, the British had been consumed by the threat of a rising Germany. Two wars had been fought, millions of lives had been lost, and the British treasury was dramatically depleted in the process. Britain survived, but the costs were substantial.

In spite of its global empire, a powerful military, and an enviable position at the center of world-wide commerce, in early 1946 the British government faced a serious risk of defaulting on its financial obligations. So it did what it had done at various points over the previous decade and turned to its closest ally for assistance. It asked the U.S. for a loan of $5 billion at zero-interest repayable over 50 years. As generous as those terms seem today, such financing had been almost routine in years prior. To the surprise and shock of the British, Washington refused.

Unable to take no for answer, Britain explained that unless it received funds the government would be insolvent. The Americans came back with a series of conditions. They would lend Britain $3.7 billion at 2% interest, and the British government would have to abide by the 1944 Bretton Woods plan, which made the dollar rather than the pound sterling the reference point for global exchange rates and required Britain to make the pound freely convertible. Even more significantly, Britain had to end its system of imperial preferences, which meant no more tariffs and duties on goods to and from colonies such as India. These were not mere financial penalties: Taken together, they meant the end of the British Empire.

Within two years, Britain had left India and was on its way to decolonizing throughout Asia and Africa. Unable to compete with the United States economically and no longer able to reap the benefits of colonial trade, Britain's military shrank and its commerce contracted. It quickly receded from its dominant global position and entered several decades of economic malaise. In the 1980s, Britain finally emerged as a prosperous country, but it was a shadow of what it had been in its heyday.

The U.S. replaced Britain as the guardian of the West. As one British official, Evelyn Shuckburgh, remarked in the late 1940s, "it was impossible not to be conscious that we were playing second fiddle." And that was precisely what the U.S. desired. Having supported the British for decades and become its banker and manufacturer during two wars, at the end of World War II the U.S. fully intended to supplant the British Empire. The loan request provided the pretext, but by then the balance had already shifted and Britain could have done little to reverse the tide.

By 2030—if not sooner—China is likely to surpass the U.S. in the size of its economy, though it will remain on a per capita basis a much poorer society for many years after that. Trajectories can change, but the recent implosion of the American financial system has only accelerated China's rise.

Given the lesson of the British Empire's demise, it would be foolish to base current policy on the assumption that China will hit a fatal speed-bump before it is able to supplant the U.S. And while the level of current indebtedness is manageable for the U.S.—and in fact tethers the Chinese closely to the U.S. economy in ways that are arguably beneficial for both countries—the fact that these economies are currently bound together does not mean that their interests will always be in sync.

Here, too, the British analogy is sobering. For decades, the relationship between Britain and the U.S. was mutually beneficial, though the Americans resented being treated as junior partners. As tension festered, the British were consumed with the more immediate threat of Germany. But in the end it was the U.S. that delivered the knockout blow.

The Americans have not had to deal with a true economic rival since the British more than half a century ago. America today is as unaccustomed to global economic competition as the British were at their apex. The U.S. often seems lumbering and ill-suited to the demands of economic rivalry.

The only way to avoid Britain's fate and meet the challenge of China is to reinvigorate economic life. This is a multiyear endeavor that must be done primarily through innovation, not legislation. America needs to retool its domestic economy to build on the global success of many U.S. companies. It must focus on inventing new products and generating new ideas, rather than defending the rusty industries of yesterday. Fights over health care and climate change are the cultural equivalent of fiddling while Rome burns.

China thrives because it is hungry, dynamic, scared of failure and convinced that it should be a leading force in the world. That is why America thrived a century ago. Today, such hunger and dynamism seem less evident in American life than petulance that the world is not cooperating.

The U.S. is in danger of assuming that because it has been a dominant nation on the world stage, it must continue to be so. That is a recipe for becoming Britain.

Mr. Karabell is the author of "Superfusion: How China and America Became One Economy and Why the World's Prosperity Depends on It," just published by Simon & Schuster.

Economists have long predicted the dollar’s demise as the global currency of choice.  Some, such as Paul Krugman, hailed it as a means of correcting the American trade imbalance.  Love it or hate it, the weakening of the American dollar has begun as central banks have started to buy euros and yen while dumping the dollar (via Instapundit):

Central banks flush with record reserves are increasingly snubbing dollars in favor of euros and yen, further pressuring the greenback after its biggest two- quarter rout in almost two decades.

Policy makers boosted foreign currency holdings by $413 billion last quarter, the most since at least 2003, to $7.3 trillion, according to data compiled by Bloomberg. Nations reporting currency breakdowns put 63 percent of the new cash into euros and yen in April, May and June, the latest Barclays Capital data show. That’s the highest percentage in any quarter with more than an $80 billion increase.

World leaders are acting on threats to dump the dollar while the Obama administration shows a willingness to tolerate a weaker currency in an effort to boost exports and the economy as long as it doesn’t drive away the nation’s creditors. The diversification signals that the currency won’t rebound anytime soon after losing 10.3 percent on a trade-weighted basis the past six months, the biggest drop since 1991.

This could not come at a worse time, as the current American administration busies itself with massive new spending — and massive new debt.  The weaker dollar will make the sale of Treasuries that much more expensive, which should warn the US government away from further deficit spending.  The biggest problem afflicting the dollar, Bloomberg reports, is that there is just too much of it on the market, thanks to the increased need to cover deficit spending and the monetary policy that accompanies that need.

Does a weak dollar matter?  Should Americans care whether our currency dominates world markets?  James Pethokoukis says that whether we should or not, the decline of the dollar will almost certainly become a large political problem for Barack Obama:

A recent Rasmussen poll, for instance, found that 88 percent of Americans say the dollar should remain the dominant global currency. Now, the average voter may not fully understand the subtleties of international finance nor appreciate exactly how a dominant dollar has benefited the U.S economy. But they sure think a weaker dollar is a sign of a weaker America.

And that’s the political problem for the Obama administration. Its benign neglect of the dollar is another example of an economic policy — along with TARP and the $787 billion stimulus — that the White House thinks is helping the economy, but many Americans find wrongheaded.

In his New York Times column today, Paul Krugman makes the usual case for a weaker dollar: It helps U.S. exporters and is a necessary part of a global economic rebalancing. And there is some truth in that, particularly the idea that Rising Asia will result in a less-dominant dollar. Then again, a devalued currency hasn’t exactly been a proven path to prosperity. (Ask Jimmy Carter.)

But Krugman too easily dismisses the idea that the dollar’s decline could tumble out of control. Former Clinton economic officials such as Robert Rubin and Roger Altman have been making the case that investor concern about budget deficits could lead them to abandon the dollar. As Altman argued in a Financial Times op-ed piece today: “The dismal deficit outlook poses a huge longer-term threat. Indeed, it is just a matter of time before global financial markets reject this fiscal trajectory. That could lead to a punishing dollar crisis.”

Pethokoukis imagines a campaign slogan for 2010 and 2012 being, “Who lost the dollar?”  It might make for a good slogan at that, but blaming it all on Obama would be a little too easy.  The crisis has its roots in policies that go back at least a decade, and in deficit spending that began to get out of hand with a Republican Congress and Republican President and went insanely wrong when Democrats took control.

However, Obama’s fiscal policies are the worst we’ve seen in a generation.  In a crisis which demands a return to fiscal sanity, the White House has instead become the asylum, as these deficit projections show — even without ObamaCare and cap-and-trade:

Instead of finding new ways for the federal government to spend money, Congress and the President should be finding new ways to curtail it and demonstrate that we intend to end our irresponsible spending and massive government overreach into the private sector.  In that sense, we can blame Obama for losing the opportunity to stop the dollar crisis before it reaches a tipping point.