Thursday, December 31, 2009


"There's a sucker born every minute" is a phrase often credited to P.T. Barnum (1810 – 1891), an American showman. It is generally taken to mean that there are (and always will be) a lot of gullible people in the world.

Today's biggest threat to liberty is from the global warming hysteria, because that is the only major political movement that provides a basis for totalitarian control: by seeking to control all of our cheapest, most abundant sources of energy—for which there are no viable alternatives—this movement seeks to control every aspect of our economy and of our lives. Item #1 below gives you just the smallest taste of what the global warming creed demands from us.

This movement is already well on its way to seizing power, bypassing the legislative process. As I have warned, the EPA is poised to impose a carbon dictatorship by executive decree.

That's why the second most important story this year is Climategate, the exposure of incriminating e-mails and data files from the top level of the global warming clerisy. By revealing how the supposed scientific "consensus" on global warming has been rigged, and by calling into doubt all of the basic data and calculations used by the warmists, this scandal has helped to deliver a crushing blow to the scientific underpinnings of the whole warming hysteria. Climategate has invigorated the global warming "skeptics" and given them new credibility, while putting the perpetrators of the hysteria on the defensive.

Since this is all relatively recent—the story broke just before Thanksgiving—I won't recap my commentary on Climategate itself. I'll just direct you to one of my recent articles at RealClearPolitics.

Instead, below I recap the pre-history of Climategate. The scandal had such an electrifying effect precisely because the cooling winds of an intellectual climate change were already blowing.

And they haven't stopped blowing, either. I expect that the new year will bring much more news on this front, including new revelations of fraud and corruption at the center of the global warming establishment. Stay tuned.—RWT


Top Stories of the Year

The First Church of the Warming Globe

"Global Warming Ate My Data"


Intellectual Climate Change

Feature Article

Environmentalism's Berlin Wall, by Robert Tracinski

Top News Stories

Commentary by Robert Tracinski

1. The First Church of the Warming Globe, January 15

The environmentalist quasi-religion continues to place ever greater demands for sacrifice on its devotees. The latest? An article in last Sunday's London Times made some alarming claims about the "carbon footprint" of Google searches. Apparently, someone has figured out that the electronic economy runs on electrons, which have to put in motion by old-fashioned power plants.

The facts behind the Times report have since been disputed, but an overview of the controversy in the Telegraph makes it clear that there is a wider movement toward "green IT," which seeks to place environmental restrictions on the industrial infrastructure of the Internet.

An even more disturbing example of this "green IT" trend is the item below. The link is to an annoying "interactive feature" on the New York Times, so you will have to do some navigation to find this item, but its upshot is the creation of a kind of self-flagellation device—explicitly inspired by devices worn by ascetic monks in the Middle Ages—that allows users to mortify the flesh to atone for the guilt of using industrial power.

But the most twisted aspect of this story is the fact that the inventor of this infernal device works for a "Computing Culture" program at the Massachusetts Institute of Technology. It is one of the centers of high technology that is helping to move us back toward the mentality of the Middle Ages.

Thanks to TIA Daily reader Steve Hathway for recommending this link.

"Carbon Penance," Jascha Hoffman, New York Times Magazine, "The Year in Ideas 2008"

We all contribute to climate change, but none of us can individually be blamed for it. So we walk around with a free-floating sense of guilt that's unlikely to be lifted by the purchase of wind-power credits or halogen [sic: the author means "fluorescent"] bulbs. Annina Rüst, a Swiss-born artist-inventor, wanted to help relieve these anxieties by giving people a tangible reminder of their own energy use, as well as an outlet for the feelings of complicity, shame and powerlessness that surround the question of global warming.

So she built a translucent leg band that keeps track of your electricity consumption. When it detects, via a special power monitor, that electric current levels have exceeded a certain threshold, the wireless device slowly drives six stainless-steel thorns into the flesh of your leg. "It's therapy for environmental guilt," says Rüst, who modeled her "personal techno-garter" on the spiked bands worn as a means of self-mortification by a monk in Dan Brown's novel "The Da Vinci Code." (Brown derived the idea from the bands worn by some celibate members of the conservative Catholic group Opus Dei.)

Rüst built her prototype while working at the Computing Culture group of the Media Lab at the Massachusetts Institute of Technology.

2. "Global Warming Ate My Data," August 18

The main link below discusses the beginning of a potential scandal over the integrity of the data used to calculate global temperatures. It seems a British scientific institution charged with maintaining global temperature data has been besieged with requests by other scientists for access to the raw data that they use as the basis of their global temperature reports. Having refused those requests repeatedly in the past, they were on the verge of being forced to release it—so now they are claiming that the data has been lost.

But that's not all. Jack Wakeland brought my attention to a report on ICECAP—a website for global warming rejectionists—which analyzes the systematic neglect and exclusion of temperature measurement stations, thereby contaminating the raw data global warming "scientists" are using for their claims about climate trends.

Jack adds this comment:

"It is rare that one can see physical evidence of evasion. Normally it is a dishonest psychological phenomenon that leaves no external physical mark on the perpetrator.

"However, the new 'science' of global warming has set new standards for evasion. In the past 20 years, global warming 'scientists' have abandoned the vast majority of the scientific surface temperature measuring stations on earth. They have ignored a vast network of temperature stations installed on ocean buoys for their benefit and have ignored satellite data collected for the purpose of climate research.

"Over the past 20 or 30 years global warming 'scientists' have discounted, ignored and/or physically abandoned 5000 of the world's 6000 surface weather stations.

"Over the past 20-year period, private and public funding for climate research has increased 20-fold. In 1989, the US government spent approximately $150 million on climate science research. In 1995, that figure ballooned to $1.5 billion per year. In 2008, the federal government spent $2.4 billion on climate research. This growth in government subsidies occurred under the center-left and center-right leadership of Bill Clinton and George W. Bush. 2009 figures are not yet compiled, so we haven't yet seen what the figures will look like under Obama's leadership. Over the 20-year period, 1989—2008, the US government spent a total of $32 billion on climate research.

"With $32 billion in US government expenditures, one would think that global warming science could afford a few more surface temperature measuring stations. One would think that the global warming science could afford a network of thousands of brand-new, carefully sited, state-of-the art surface temperature measuring stations. How much could 10,000 new temperature stations cost, anyway? Maybe 3% of the 2009 research budget? Maybe 10%?

"But global warming 'scientists' can't afford it. They can't afford anything that might divert our eyes from the fantastic projections of their global circulation models. That could cost this neo-religious/neo-Marxist pseudo-science everything.

"Real data on the world's climate is something that can't be ordered to conform to the anti-civilization ideology that global warming 'scientists' are promoting. Data that doesn't follow orders might undermine their research budgets, their prestige, their political pull, and their capacity to destroy industrial civilization.

"It's either facts or power. Global warming 'science' can't afford any facts."

When will the pseudo-science of global warming collapse? Jack points to one potential trigger: a new revolt by members of the American Physical Society.

"Global Warming Ate My Data," Andrew Orlowski, The Register, August 13

The world's source for global temperature record admits it's lost or destroyed all the original data that would allow a third party to construct a global temperature record. The destruction (or loss) of the data comes at a convenient time for the Climatic Research Unit (CRU) in East Anglia—permitting it to snub [Freedom of Information Act] requests to see the data.

The CRU has refused to release the raw weather station data and its processing methods for inspection—except to hand-picked academics—for several years. Instead, it releases a processed version, in gridded form. NASA maintains its own (GISSTEMP), but the CRU Global Climate Dataset, is the most cited surface temperature record by the UN IPCC. So any errors in CRU cascade around the world, and become part of "the science".

Professor Phil Jones, the activist-scientist who maintains the data set, has cited various reasons for refusing to release the raw data. Most famously, Jones told an Australian climate scientist in 2004. "Even if WMO agrees, I will still not pass on the data. We have 25 or so years invested in the work. Why should I make the data available to you, when your aim is to try and find something wrong with it."

3. Swindle, September 29

A few years ago, a British television station put out a terrific documentary on the global warming hysteria. The best part about it was its title, "The Great Global Warming Swindle," which perfectly captured the atmosphere of dishonest hucksterism that has corrupted the science of climatology.

The word "swindle" may prove to be the most precise word to describe the bogus science of global warming. A recent development is making the claim of global warming look less and less like a real scientific controversy—a disagreement over the interpretation of the data—and more like a case of plain scientific fraud, a deliberate corruption of the data itself. And you can bet it's going to be a long time before you read about any of this in the New York Times. They'll treat this the way they treat every scandal in the Obama administration: they'll report it in three paragraphs on page A17, two days after the whole story is over.

The important work in this case has been done by Steve McIntyre of the Climate Audit blog. McIntyre has been tireless in seeking out access to the raw data and mathematical methods used by the global warming alarmists to back up their claim of an unprecedented 20th century warming trend. And now he has found a real "smoking gun."

First, some context. I'm going to try to lay out all of this science in fairly simple terms in just a few paragraphs, then I'll refer you to longer and more detailed articles.

The widest context is this: a keystone of the claim that human activity is leading to a disastrous increase in global temperatures is the denial of previous, pre-industrial warming trends, particularly the Medieval Little Optimum. After all, if global temperatures were warmer a thousand years ago than they are today, then a minor warming trend in the past few decades is well within the range of natural variation. More important, such previous warming trends imply that something other than carbon dioxide actually drives the climate, since CO2 levels were significantly lower during previous warm periods, and there were certainly no industrial smokestacks or automobiles.

(This, by the way, is the real significance of Ian Plimer's arguments, which have turned the climate debate in Australia upside down. The strength of his book Heaven and Earth is that it extensively cites the geological and historical record to demonstrate that global temperatures have varied in the past with no connection to carbon dioxide. Plimer is telling us that we can be confident that carbon dioxide won't cause global warming, because it has never done so in the past. As he put it in his interview with TIA, "The past is the key to the present…. Over the history of time, climate changes have been driven by galactic, solar, orbital, tidal, and tectonic processes, and there has been no climate change in the past driven by CO2.")

So how do you make the evidence of a Medieval warming disappear? In 1999, a scientist named Michael Mann produced the infamous "Hockey Stick" graph of global temperatures over the past 1000 years. The name refers to the fact that the graph shows fairly flat temperatures for most of that period—then a sharp upward turn in the past few decades.

Some years ago, Steve McIntyre and Ross McKitrick thoroughly debunked the methodology behind the Hockey Stick, showing that it was heavily based on questionable data and a statistical method that would produce a similar hockey stick shape out of random noise. Last year, undeterred, Mann produced a new version of the Hockey Stick—quickly dubbed "Son of Hockey Stick"—claiming that it was based on a wider set of data.

Since reliable direct measurements of global temperature only date back about 150 years, how do scientists go about estimating global temperatures over the past 1000 years? They have to rely on proxies. They have to find some other data that varies with temperature and which can be measured directly. Both versions of the hockey stick rely heavily on tree rings. Since the annual growth rate of trees is partly dependent on temperature, the size of tree rings can serve as a proxy for temperature. By analyzing petrified remains of trees, or the growth rings of very old, slow growing trees, scientists can use this data as a proxy for global temperatures going back many centuries.

But here's where McIntyre's latest analysis comes in. He discovered that Son of Hockey Stick relies heavily on data from tree rings in northern Russia, but that Mann and his collaborators have used that data selectively, citing only a small subset of tree ring data which confirms the upward sloping "hockey stick"—while ignoring a much larger pool of data from the same region which contradicts the hockey stick. If that data is included, it shows that current global temperatures are unexceptional and lower than temperatures during the Medieval Little Optimum.

As Jack Wakeland pointed out to me, this isn't just a scientific scandal. It is a crime, since it involves the fraudulent misappropriation of public funds by government-sponsored climate scientists.

Read McIntyre's main blog entry on this issue here, as well as a good summary by Anthony Watts at Watt's Up With That? and another by Australian science reporter Joanne Nova. Also see McIntyre on the disproportionate influence of one "outlier" in the data, which McIntyre calls "The Most Influential Tree in the World" and which the commenters on his blog are calling the "Enchanted Larch of Yamal."

The wider scandal here is the long fight McIntyre had to go through to get access to the data used to create Son of Hockey Stick. It is a basic principle of science that you don't just get to present your results; you also have to present the data and methods used to obtain the result, so that others can verify and reproduce it. Yet it seems to be standard for climate scientists to refuse to divulge the sources of their data on global temperature, for fear that troublesome interlopers like McIntyre will pick the data apart. Last week, I linked to an article by Patrick Michaels describing how another major source of global temperature records has refused to release its raw data, using a lame "the dog at my homework" excuse.

As Michaels notes, "If there are no data, there's no science." A scandal involving the corruption of the data by global warming researchers invalidates every claim they have made. So you can see how this story could get very interesting, very quickly. Stay tuned.

4. Intellectual Climate Change, November 16

The push for "emergency" powers to enforce energy rationing is reaching a hysterical frenzy precisely because the greens realize they are living on borrowed time. Every month and every year, more scientists defect from the global warming "consensus"—and they unearth more evidence and arguments to show that the "science" of global warming is bunk.

Below is an article that just recently came to my attention, but which kills the whole global warming hysteria dead at its root.

First, let me provide a little scientific context. Carbon dioxide is a relatively weak greenhouse gas, so an increase in atmospheric carbon dioxide would, by itself, lead to a very small increase in temperatures. To manufacture an allegedly dangerous level of global warming, the warmists have to invent feedback mechanisms that magnify every temperature change. They have to claim that the small warming caused by carbon dioxide triggers other factors that cause further warming, and so on and on in a runaway feedback loop.

Put differently, they have to claim that the climate has a built-in accelerator that causes it to run out of control. But what if it has built-in brakes, instead?

That is essentially the conclusion offered by MIT atmospheric scientist Richard Lindzen in the summary below. He analyzes real data about the amount of heat escaping from the upper atmosphere and compares it to the assumptions used in the computer climate models. The models assume that the hotter it gets, the more heat is trapped in the atmosphere. What Lindzen discovers is that the hotter it gets, the more heat escapes from the atmosphere. The earth tends to cool itself off, dampening any effect from carbon dioxide.

In short, the "greenhouse effect" that is supposed to drive global warming doesn't exist, and the computer models that claim to predict warming are based on an assumption that has just been disproved.

"Lindzen on Negative Climate Feedback," Richard Lindzen, Watts Up With That?, March 30

The basic idea is that the atmosphere is roughly transparent to visible light, but, due to the presence of greenhouse substances like water vapor, clouds, and (to a much lesser extent) CO2 (which all absorb heat radiation, and hence inhibit the cooling emission), the earth is warmer than it would be in the absence of such gases….

If, however, water vapor and clouds respond to the increase in temperature in such a manner as to further enhance the 'blanketing,' then we have what is called a positive feedback, and the temperature needed to reestablish equilibrium will be increased….

When temperature fluctuations lead to warmer temperatures, emitted heat radiation should increase, but positive feedbacks should inhibit these emissions by virtue of the enhanced "blanketing." Given the model climate sensitivities, this "blanketing" should typically reduce the emissions by a factor of about 2 or 3 from what one would see in the absence of feedbacks. If the satellite data confirms the calculated emissions, then this would constitute solid evidence that the model feedbacks are correct….

From 1985 until 1989 the models and observations are more or less the same—they have, in fact, been tuned to be so. However, with the warming after 1989, the observations characteristically exceed 7 times the model values. Recall that if the observations were only 2-3 times what the models produce, it would correspond to no feedback. What we see is much more than this—implying strong negative feedback….

The earth's climate (in contrast to the climate in current climate GCMs) is dominated by a strong net negative feedback. Climate sensitivity is on the order of 0.3°C , and such warming as may arise from increasing greenhouse gases will be indistinguishable from the fluctuations in climate that occur naturally from processes internal to the climate system itself….

Alarming climate predictions depend critically on the fact that models have large positive feedbacks. The crucial question is whether nature actually behaves this way. The answer, as we have just seen, is unambiguously no.


TIA Daily Feature Article

5. Environmentalism's Berlin Wall, April 30

by Robert Tracinski

Now that the American people have foolishly allowed Democrats to control the presidency and a large majority in Congress, the left is proceeding with massive new controls designed to choke off our ability to generate power on the scale required to maintain an industrial civilization.

What about the other side of the race—the race to debunk the global warming hysteria before it destroys our prosperity?

Suprisingly, there are some early indications that scientists skeptical of man-made global warming are beginning to have an impact, and there are some signs that the global warming juggernaut is losing momentum.

For example, Al Gore's attempt to trains thousands of volunteer proselytizers to spread the global warming message has produced underwhelming results. A blogger calculates that Gore's initiative was originally intended to generate as many as 26,000 revival meetings for the First Church of the Warming Globe every year. For the next month, however, only 23 such presentations are scheduled. A few small churches would beat that. So much for Gore's attempt to create a secularized religious revival.

Meanwhile, rational opposition to the global warming theory is becoming better organized. I linked yesterday (and again below) to a new website called Climate Depot. A New York Times article describes how the site was recently founded by a former staffer for Republican Senator James Inhofe, who has been the leading political opponent of global warming, responsible for blocking cap-and-trade regulations for much of the past decade.

But the most interesting developments have been happening in Australia. Climate Depot recently published a letter from an Australian scientist debunking claims made by Andrew Revkin, the global warming shill who works as a science reporter for the New York Times. But what is really interesting is the last section of the letter:

[T]here has been a MAJOR change in the way that the Australian media are reporting the AGW [anthropogenic (human-caused) global warming] issue, led nobly by newspaper The Australian. The change has been stimulated by a Canberra Senate select committee that is discussing the tabled ETS legislation, and also by the release of geologist Ian Plimer's new book, Heaven and Earth. Global Warming: The Missing Science….
The trend of balanced media comment has continued this week, culminating with a splendid article…by Jan Veizer in today's Australian.

That article sums up the state of genuine science on the real causes of global temperature fluctuations. The basic picture is that dihydrogen monoxide gas—water vapor—is a far more powerful greenhouse gas than carbon dioxide, and that the natural interaction of solar radiation and water vapor (including the mechanism of cloud-formation discovered by Henrik Svensmark) is what really determines global temperatures.

Atmospheric CO2 is thus the product and not the cause of the climate, as demonstrated by past records where temperature changes precede changes in atmospheric CO2 concentrations and fluxes.

Another article in The Australian describes the general turning of the tide on global warming:

With public perceptions changing so dramatically and quickly it is little wonder Ian Plimer's latest book, Heaven and Earth, Global Warming: The Missing Science, has been received with such enthusiasm and is into its third print run in as many weeks.
The public is receptive to an expose of the many mythologies and false claims associated with anthropogenic global warming and are welcoming an authoritative description of planet Earth and its ever-changing climate in readable language.

I checked in on all of this with my antipodean correspondent Tom Minchin, who confirms that this is all true.

The journalist leading the charge is Andrew Bolt of the Melbourne Herald Sun. But The Australian is growing in confidence and the rejectionism is spreading. One of the most remarkable changes occurred two weeks ago [April 13] when leading AGW hysteric Paul Sheehan (who writes for the main Sydney newspaper the Sydney Morning Herald, which has done as much to project the myth of AGW as any newspaper here) reviewed Ian Plimer's new book and admitted he was taken aback.

Here is how Sheehan's review begins:

What I am about to write questions much of what I have written in this space, in numerous columns, over the past five years. Perhaps what I have written can withstand this questioning. Perhaps not. The greater question is, am I—and you—capable of questioning our own orthodoxies and intellectual habits? Let's see.
The subject of this column is not small. It is a book entitled Heaven and Earth, which will be published tomorrow. It has been written by one of Australia's foremost Earth scientists, Professor Ian Plimer. He is a confronting sort of individual, polite but gruff, courteous but combative. He can write extremely well, and Heaven and Earth is a brilliantly argued book by someone not intimidated by hostile majorities or intellectual fashions.

The book's 500 pages and 230,000 words and 2311 footnotes are the product of 40 years' research and a depth and breadth of scholarship.

With this awed endorsement of Plimer's scientific credibility, Sheehan then summarizes Plimer's argument:

Much of what we have read about climate change, he argues, is rubbish, especially the computer modeling on which much current scientific opinion is based, which he describes as "primitive."…

The Earth's climate is driven by the receipt and redistribution of solar energy. Despite this crucial relationship, the sun tends to be brushed aside as the most important driver of climate. Calculations on supercomputers are primitive compared with the complex dynamism of the Earth's climate and ignore the crucial relationship between climate and solar energy.

"To reduce modern climate change to one variable, CO2, or a small proportion of one variable—human-induced CO2—is not science. To try to predict the future based on just one variable (CO2) in extraordinarily complex natural systems is folly."

In response, this is Sheehan's conclusion:

Heaven and Earth is an evidence-based attack on conformity and orthodoxy, including my own, and a reminder to respect informed dissent and beware of ideology subverting evidence.

The title of Sheehan's article? "Beware the Climate of Conformity." He never actually comes out and says that Plimer's argument against man-made global warming is correct or that he agrees with it. But I don't think this review can be interpreted as anything other than a capitulation. It cedes to the skeptics the high ground of being "evidence-based" and accepts the characterization of the global warming promoters as dogmatic conformists.

Australia is not that different from America. If a shift in opinion against the global warming dogma can happen there, it can happen here, particularly when Plimer's book finds an American publisher.

I have been arguing for years that the global warming scare could prove to be to environmentalism what the Berlin Wall was to socialism. When the Berlin Wall fell and the Soviet empire collapsed, it provided a factual refutation of the ideological claims of socialism, discrediting the theory of a state-controlled economy for two full decades. (And while socialism is making a comeback at the moment, I hold out significant hope that it will rapidly discredit itself again in the next few years.) Similarly, the environmentalists have staked so much of their credibility on bogus factual claims about global warming that the collapse of the scientific rationalization for that hysteria would deal a shattering, demoralizing blow to the whole movement.

The task of discrediting the global warming propaganda campaign—and fending off or rolling back global-warming regulations—will certainly be long and difficult. But Australia has just provided us with evidence that it is possible.

Robert Tracinski writes daily commentary at He is the editor of The Intellectual Activist (TIA) and contributor to The Freedom Fighter's Journal

2009 Year In Review: The Second Iranian Revolution

It is in vain, sir, to extenuate the matter. Gentlemen may cry, Peace, Peace-- but there is no peace. The war is actually begun! The next gale that sweeps from the north will bring to our ears the clash of resounding arms! Our brethren are already in the field! Why stand we here idle? What is it that gentlemen wish? What would they have? Is life so dear, or peace so sweet, as to be purchased at the price of chains and slavery? Forbid it, Almighty God! I know not what course others may take; but as for me, give me liberty or give me death.

--Patrick Henry

The #3 top story of the year is the new Iranian revolution—proof that you should never count out the strength of the human spirit or the appeal of the cause of liberty.

TIA Daily was on top of this story early, reporting on the unexpectedly radical campaign of Mir Hossein Mousavi shortly before the Iranian election, then providing extensive coverage of the protests after the election was rigged. Most important, we have followed the way in which the uprising changed from a protest over a stolen election into a broad rejection of the whole theocratic system. The main title above is taken from a recent report on this growing support for a secular republic as the goal of the "green" protest movement.

TIA Daily's running coverage of the Iranian revolution has been a bit too detailed to excerpt easily, so below I have reprinting the one feature article, originally published on July 24, that provides my deepest answer on the cause and meaning of the events in Iran. This article also has the virtue of integrating the uprising in Iran with the underappreciated story that I wanted to highlight: the shift in public opinion against the Taliban in Pakistan. Taken together, these two stories could bring America a substantial victory in the War on Terrorism—even despite the current president's failure (or in the case of Iran, refusal) to do anything to encourage these trends.

And the story of the Iranian revolution is not over. Just in the past week, the protesters may have begun to gain the advantage over the regime. The London Times has a very good report on last weekend's clashes between protesters and police, while Michael Totten discusses how killing Muslims on Ashura—"like crucifying Christians on Christmas," as one protester puts it—further undermines the moral legitimacy of the regime.

See also a good slide show of images from the clashes, which make it clear that in many cases the protester are putting the police on the defensive.

The Iranian revolution may take a while to succeed, but it is looking increasingly likely that the regime will fall—and that it will do so in the next year. That's a top story I'm really looking forward to recapping a year from now. Stay tuned.—RWT



Morality Ends Where a Gun Begins

by Robert Tracinski

If the Iranian regime falls and we are able to make progress against al-Qaeda in Afghanistan and Pakistan, it may turn out that President Bush did just enough for victory in the War on Terrorism. It still seems so little compared to what he might have done. I will not rehearse here the many lost opportunities in Israel and Lebanon and elsewhere, or Bush's failure to act to destroy Iran's nuclear program. Yet what he did do is nevertheless working.

So it is important to start asking: why? What are the strengths that make victory possible to us—and what are the weaknesses that have put our enemies on the defensive, facing the very real possibility of defeat?

Over the years, I have offered a few answers on this topic, in bits and pieces as events made them relevant. Now is a good time to bring all of those pieces together.

Let us start with the weakness of the enemy, because this is a very substantial cause of the events we have witnessed in the past few months, particularly in Iran.

It is fascinating to note how, in a contest between opposing ways of life, Islamic theocracy keeps losing, every time people get the slightest choice in the matter. There must be something about radical Islam that makes it lose, something that makes it uniquely repulsive and unappealing and causes it to lose the loyalty of the people who live under it, even as free societies tend to gain the loyalty of those who live in them.

I drew some initial conclusions on this issue in the March 3, 2005, edition of TIA Daily. This was at another point when events were beginning to break our way—Syria was retreating before the Cedar Revolution in Lebanon, for example, and there was speculation (four years premature, as it turned out) about a "Pink Revolution" in Iran as young women began to openly rebel against religious restrictions—and I asked the same question: "now that we can sense that the enemy's collapse is possible, we need to ask: why?"

"That our enemy in the current war is materially weak has been clear from the beginning: terrorism is by its nature a weapon employed by the weak, by those who are unable to fight with tanks, warships, and missiles. But this enemy has also put up a wall of strident-sounding propaganda that obscures his profound spiritual weakness….

"What I think we are learning from recent events…is that no ideology can seal itself off from comparison to reality. Even religious dogmas make statements about the nature of this world—statements whose falsity can be definitively demonstrated by the course of history….

"[The Islamists] claim that theocratic rule will guarantee the rule of virtue on this earth. The religious police in these countries always have comical names like the 'Ministry for the Prevention of Vice and the Promotion of Virtue.' Yet in one country after another, and most especially in Afghanistan and Iran, Muslims have been able to observe that theocracy actually leads to rule by the most evil, vicious, and corrupt men. The Taliban are global synonyms for sadistic brutality, and the mullahs in Iran are notorious for running a literal mafia devoted to the looting of the country's wealth. And in Iraq, as the insurgency has increasingly targeted Iraqi civilians, Muslims can observe that the 'holy warriors' they are supposed to admire have degraded into plain, brutal, senseless mass murderers."

Note that I wrote this in early 2005, about a year and a half before the beginning of the Anbar Awakening, which happened when al-Qaeda's local allies in Iraq finally became so enraged by its atrocities that they rebelled against it.

I expanded a bit on the same theme more recently, in April, in discussing the impact of a video showing the Taliban beating a young woman in a town where they had taken over in Pakistan.

"[T]he new Taliban video…demonstrates the central failure of Islamism, revealed clearly even to those in the Muslim world. The Islamic theocrats offer their supporters one central promise: to establish the rule of virtue on earth. But they always provide the exact opposite: the rule of brute force and the doctrine of 'might makes right.' Their code actually banishes morality from public life, subordinating it to force. The routine brutalization of women and girls under the rule of Islam is a constant and vivid reminder of this fact."

More recently, I ran across some additional evidence that will allow us to take this conclusion a bit further.

The first story is the unexpected confession of the sole surviving gunman from last year's terrorist attacks in Mumbai. Ajmal Kasab stunned a New Delhi courtroom by standing up and talking for hours about how he was recruited by militants in Pakistan and how he helped carry out the attacks. After days of listening to witnesses describe his crimes, he was clearly feeling a profound sense of guilt. "'I don't think I am innocent,' he said, speaking in subdued Hindi. 'My request is that we end the trial and [I] be sentenced.'" He must know that the most likely sentence is death by hanging.

What was most revealing about Kasab's confession was his description of how and why he came to be a terrorist:

He told Judge M.L. Tahilyani that he was broke and tired of his job working for decorator in Jhelum, a small town in Pakistan, and making a pittance. He and a friend had hatched a plan. They would earn cash by robbing people. And to improve their banditry skills they would seek out military training from the easiest source available to a young Pakistani man: Islamic militants.

Mr. Kasab and his friend went to Rawalpindi, he said, and asked in the market where they might find mujahedeen. They were directed to the office of [the Kashmiri terrorist group] Lashkar-e-Taiba.

So there you have it, the ideal recruit for Islamic fundamentalists: an aspiring armed robber.

Even more revealing is the Jerusalem Post's shocking interview with a member of the Basij militia, the supposed guardians of religious morality in Iran.

He said he had been a highly regarded member of the force, and had so "impressed my superiors" that, at 18, "I was given the 'honor' to temporarily marry young girls before they were sentenced to death."

In the Islamic Republic it is illegal to execute a young woman, regardless of her crime, if she is a virgin, he explained. Therefore a "wedding" ceremony is conducted the night before the execution: The young girl is forced to have sexual intercourse with a prison guard—essentially raped by her "husband."…

"I could tell that the girls were more afraid of their 'wedding' night than of the execution that awaited them in the morning. And they would always fight back, so we would have to put sleeping pills in their food. By morning the girls would have an empty expression; it seemed like they were ready or wanted to die.

"I remember hearing them cry and scream after [the rape] was over," he said. "I will never forget how this one girl clawed at her own face and neck with her finger nails afterwards. She had deep scratches all over her."

The rule of virtue on earth? No, this is sadism under the cover of morality. And it is standard operating procedure for the Basij. The interview describes the Basij member's view of who has been committing many of the beatings and killings of protesters.

He pinned the blame for much of the most ruthless violence employed by the Iranian security apparatus against opposition protesters on what he called "imported security forces"—recruits, as young as 14 and 15, he said, who have been brought from small villages into the bigger cities where the protests have been centered.
"Fourteen and 15-year old boys are given so much power, which I am sorry to say they have abused," he said. "These kids do anything they please—forcing people to empty out their wallets, taking whatever they want from stores without paying, and touching young women inappropriately. The girls are so frightened that they remain quiet and let them do what they want."

These youngsters, and other "plainclothes vigilantes," were committing most of the crimes in the names of the regime, he said.

This doesn't even rise to the level of a theocracy. It's Lord of the Flies. And that's the sick tragedy of this story.

Explaining how he had come to join the volunteer Basiji forces, he said his mother had taken him to them. When he was 16, "my mother took me to a Basiji station and begged them to take me under their wing because I had no one and nothing foreseeable in my future. My father was martyred during the war in Iraq and she did not want me to get hooked on drugs and become a street thug."

A desperate widow, raising her son alone and afraid he will become a criminal, brings him to the religious militia in the hope that they will keep him on the straight and narrow—and instead, they turned him into an even worse criminal. There is the enemy's fatal contradiction laid bare.

It seems that many members of the Basij and the other security forces sense this—that under the cover of moral idealism they have become accomplices to evil.

The Basiji member, who is married with children, spoke soon after his release by the Iranian authorities from detention. He had been held for the "crime" of having set free two Iranian teenagers—a 13-year-old boy and a 15-year-old girl—who had been arrested during the disturbances that have followed the disputed June presidential elections. "There have been many other police and members of the security forces arrested because they have shown leniency toward the protesters out on the streets, or released them from custody without consulting our superiors."

This guilt and uncertainty on the part of the regime's own security personnel is the sort of thing that rots an evil regime away from the inside and brings it down. It falls because even the men who are supposed to defend it know that it is evil.

This story gives us a fuller idea of the exact issue that has caused the rejection of Islamic theocracy in Iraq, in Iran, and hopefully also in Pakistan—even among people who are not educated liberals and who are unlikely advocates of secularism or the separation of mosque and state. And it is why many of the leading opponents of the regime in Iran are themselves members of the clergy.

The issue at stake here is more basic and elemental than dictatorship versus representative government, or separation of church and state. The issue is the role of morality in human life.

What is at stake is whether morality is to have any such role—and the defenders of theocracy are the ones who have come out against morality.

The specific form this takes is an internal theological dispute within Islam, so it is easy to dismiss it as nothing more than a power struggle between different religious factions. But religion here is a stand-in for morality as such, and the theological dispute is whether religion and morality take precedence over force and terror.

This is the literal theological issue behind both al-Qaeda as established by Osama bin Laden and the Iranian theocracy as established by the Ayatollah Khomeini.

Last summer, I linked to an important article on the defection of al-Qaeda's chief religious theorist, Sayyid Imam al-Sharif, also known as Dr. Fadl, who had been convinced, while in an Egyptian jail, to denounce al-Qaeda and bin Laden. One of the central issues of his defection was a dispute over who ought to be in charge of the jihad: religious scholars like Fadl, or practical leaders like Ayman al-Zawahiri and Osama bin Laden.

The Middle East Media Research Institute provides several eye-opening reports (a short version here and a long version here) describing this conflict between "the party of jurisprudence" and "the party of action." At the time ("The Fundamentalist Apostates," June 5, 2008), I noted that this report explains "the reason why the jihadists have historically been so dependent on the support of established Islamic scholars: most of them are laymen—malignant malcontents who want to claim the ideological support of Islam but who have no specialized religious training that allows them to claim such support on their own authority."

Hence one of the issues behind Dr. Fadl's defection. As I described it: "It turns out that the current Sunni jihadist movement, while billing itself as a fundamentalist movement that wants to go back to traditional Islam, is actually a religious rebellion against the currently recognized Sunni religious authorities….

"[T]he jihadist movement has devolved into an attempt to establish the 'charismatic' jihadist leader as an infallible religious authority, enjoying a status similar to that of the prophet Mohamed himself—arguably a blasphemous notion. The goal is to free the jihadist leader from the necessity of religious scholarship, qualifying him to overrule the entire religious establishment."

According to MEMRI:

In the past, religious authority within this movement stemmed primarily from the scholarly credentials and reputation of the individual. This changed with the advent of a new group, namely the jihadi Salafi camp…. Though the members of this movement could not compete with the traditional Salafi scholars in erudition or devoutness, they nevertheless wished to gain religious authority. Consequently, they sought a new basis for religious authority that would include them within its scope.
To this end, the jihadists began promoting the idea that charisma—a personal trait that endows one with extraordinary and even supernatural qualities—was also a basis for authority on religious and social matters…. By describing the mujahideen as infallible, the jihadi Salafis removed them from the earthly realm of learning and erudition—a sphere monopolized by the traditional Salafi scholars—and elevated them to the level of individuals blessed with supernatural spiritual powers.

I then observed: "This is the deal with the devil every religion makes when it justifies the use of force to spread or enforce its influence. In the end, using force as a means to enforce the faith ends up subordinating the faith to the rule of force…. [T]hat is why, on the Sunni side, bin Laden and his henchman are trying to establish the precedent that their acts of ruthlessness automatically grant them the status of prophets."

I also observed: "That's why Iran is ruled by the Ayatollah Khamenei, who has the religious equivalent of a mail-order diploma; he was pushed through to ayatollah status, not because he was an eminent religious scholar, but because he had the political power and ruthlessness to defend Iran's Islamist dictatorship."

I did not realize until recently how literally true this is. In the middle of a very useful guide to the theological conflicts among Iran's Shiites—and particularly the history of the liberal and "reformist" factions—Abbas Milani provides a revealing summary of the doctrines of the Ayatollah Khomeini.

Before coming to power, Khomeini argued that the most important duty, indeed the raison d'etre of an Islamic government, was to implement fully the tenets of sharia [Islamic law]. But once in power and faced with the complexities of modern Iranian society, he subtly changed the very foundation of his theory. He introduced the concept of maslaha—interests of the regime—and declared, much to the consternation of nearly every other ayatollah, that these interests, as determined by him or his successor, would supersede even the fundamentals of Islam. In other words, the state was everything—and sharia was nothing but its legitimizing narrative, a narrative that could be suspended at the will of the leader.

Both al-Qaeda's theory and Khomeini's are literally doctrines of might makes right. It is not the case that Osama bin Laden claims the right to kill because of his established moral and religious authority; rather, he claims moral and religious authority because he kills. He has made brutality into the source of religious authority.

Similarly, Khomeini did not cite religious law as the foundation of his right to stay in power. Rather, he made staying in power the foundation of religious law.

So when I observed that the code of the Islamists "actually banishes morality from public life, subordinating it to force," it turns out that this is the essence of their theological doctrines. And it has to be the essence of their doctrines, because there is no other way to maintain a dictatorship. The dictator or terrorist leader cannot admit the authority of any permanent rules or the influence of any moral authority independent of his power, because this would impose checks and balances that limit his action. So he seeks to make his ideology bend to his whims and to assert the supremacy of those whims over any kind of ideological or religious establishment. He establishes a doctrine of might makes right.

This explains the brutal equation now obvious to any Iranian: theocracy equals thugocracy. And that explains why both al-Qaeda and the Iranian regime have suffered such a spectacular loss of moral legitimacy among the populations they depend on to support them. They cannot claim moral legitimacy, because they are in favor of the subordination of morality to brute force.

Islam is particularly susceptible to such doctrines, because it was founded by a criminal and a dictator: Mohammed established himself first as a prophet, then as a brigand plundering Arabian trade routes, and finally as the tyrant of Medinah. So Khomeini and Bin Laden could plausibly claim they were following in his footsteps.

But this same contradiction is inherent in any form of theocracy. In attempting to impose the rule of religious authority, a theocracy necessarily launches a heretical assault on religious authority. This applies to any theocracy in any religious tradition—and even, for that matter, to any secular doctrine. The moment any doctrine imposes itself by force, it commits suicide. Intellectually, it ceases to be a living idea and turns into an empty formula. Morally, it ceases to be a code of values and becomes a rationalization for sadism.

What this makes fully clear to me, for the first time, is the centrality of force as a moral issue. What I have always found compelling about politics is that it is the arena for the most important moral questions of the age. But it is specifically the arena for what is, in a social context, the central moral question, the one with the power to render every other moral issue moot. That question is: will force be subordinated to the mind? Because this is the only thing that makes morality possible.

In Atlas Shrugged, Ayn Rand writes that "Force and mind are opposites; morality ends where a gun begins." Morality is a phenomenon of the free mind: it is a matter of choice, of values, of principles and arguments. When a doctrine is imposed by force, it is imposed without regard for any of these things—and thus without regard for morality. When a gun replaces an argument, it also replaces morality. Then the sadists and killers sense that they are in control and take over. That is how you get moral and religious movements composed of such "idealists" as armed robbers and rapists.

This is the fatal contradiction of the Islamists. It is what repels and disillusions their followers wherever the Islamists try to take over—from the atrocities of al-Qaeda in Iraq, to the public beatings and murders and juice-bar bombings committed by the Taliban in Pakistan, to the beatings and assassinations carried out in the streets of Tehran. The substitution of brutality for morality leads to a catastrophic loss of moral legitimacy and a subsequent rejection of the Islamists by the people they seek to rule.

Why are our enemies in the War on Terrorism losing? Why are they always doomed to lose, in the long run? Because morality ends where a gun begins.

Robert Tracinski writes daily commentary at He is the editor of The Intellectual Activist (TIA) and contributor to The Freedom Fighter's Journal

Wednesday, December 30, 2009


Napolitano quickly retracted her statement when faced with mounting evidence that our government ignored repeated warnings. For crying out loud, the bomber's own father fingered him to US officials in Nigeria as a potential terrorist.

But doesn't it give you a very uneasy feeling to realize that the Secretary of Homeland Security actually thought, for a few moments, that this was an example of "the system" working? If that's the case, then what the heck is "the system"?

When she said that the system worked, Napolitano expanded on what she meant: "The passengers and crew of the flight took appropriate action."

Well I guess now we know what the system is. Here is how it works. You, Mr. and Mrs. Air Traveler, will be frisked and strip-searched, have all of your baggage rummaged through so that you are disarmed of anything so dangerous as nail clippers, knitting needles, or shampoo—and then when the wild-eyed Islamic fanatic in seat 11A tries to blow himself up, you will be expected to tackle him to the floor, bop him on the head with the butt end of a fire extinguisher, and keep him tied up until the plane lands. And in gratitude for your courageous service as Involuntary Temporary Air Marshals, you will have even more restrictions placed on what you can bring on board when you fly.

So remind me why we are spending all of this money on a Department of Homeland Security, if the basic message to air travelers is: You're on your own. Good luck!

It is important to realize that this is not just a failure of the bureaucratic implementation of homeland security—though that is certainly the case. This is a failure of the entire idea of "homeland security." It is the failure of assuming that some kind of purely defensive strategy can protect us—that we can set up some perfect system to block incoming jihadis, rather than taking the war to the enemy and stopping the terrorists where they start.

The best "homeland defense" is a good offense. The best defense is a War on Terrorism, which the previous administration fought in a sometimes confused and inadequate way—and which the current administration refuses to acknowledge at all. It was Napolitano, you may remember, who famously redefined terrorist attacks as "man-caused disasters," and she is part of an administration that has banished the phrase "War on Terrorism." And this administration has gone off of a war footing, appeasing the leading state sponsors of terrorism, such as the Iranian regime, while replacing military tribunals for captured enemy combatants with civilian trials, granting the terrorists constitutional rights (which they don't have, because they are foreign combatants) and Geneva Convention rights (which they don't have, because they are unlawful combatants). In doing so this administration has weakened our offense against Islamic terrorists.

Toppling state sponsors of terrorism and destroying the bases from which terrorists operate is part of the war we have to fight. The other part is capturing enemy terrorist leaders, detaining them indefinitely, and subjecting them to harsh interrogations intended to uncover plots like this one. When George W. Bush advocated these policies, he used to talk about the need to "fight them over there so we don't have to fight them over here."

The newest bombing attack, and the administration's initial reaction to it, is a good example of what it means to fight them over here—a conflict in which you are the first and only line of defense.

Robert Tracinski writes daily commentary at He is the editor of The Intellectual Activist (TIA) and contributor to The Freedom Fighter's Journal

The Hopeless Youth of America

A dear friend of mine has a son turning 18 soon, a senior in High School planning to attend college before long. He drops by the house regularly and wants to talk about the current state of our country and his future. He’s a very bright articulate young man of great promise, and he is increasingly desperate for any form of good news and hope.

But like most Americans, he is frightened about his future, more so than any 18 year old should ever be in the land of the free and home of the brave. He is watching as his future is stripped from his hands, and placed in the hands of Washington DC elitists who are fully convinced that they can provide a better future for this young man, than he will ever be able to provide for himself.

He looks ahead and sees nothing but tyrannical government intrusions into his life and no hope of providing for himself or a family as his father was able to provide for him. No stability, no rights to dream, earn or own – no method by which to address his government in a peaceful way and receive the respect that every productive American taxpayer deserves.

He looks ahead and sees no means to control his own destiny, and no leaders willing to protect his unalienable right to live free and prosper under his own steam. He has no hope…

From Hope

For more than 233 years, his country was the beacon of hope and freedom all over the globe. But today, his generation will be the first to live in an America where individual freedom, individual rights and individual achievement are out-dated and unwelcome concepts of the past.

Like most kids of the new generation, this young man saw hope in the election of the “first black President” a little over a year ago. He had been told that this would be the end of racism in America, that this modern “Messiah” of moderate campaign rhetoric was something to celebrate around the world.

He was one of the 65% of Americans who had great hope for the new President on Inauguration Day 2009. He didn’t understand the 30% of Americans who had great doubts about the new American Messiah, and couldn’t begin to comprehend the 5% of Americans who had no strong opinion either way.

But today he is one of the 55% of Americans who oppose everything the new Messiah has done to his country and his future, in just ten short months. And as he watches the international left drive his country further and further into economic depression, and divide the American people like never before in history, he knows that this cannot end well for his generation…

To Hopeless

From 65% hopeful to 55% opposed and hopeless in ten short months is a lot for an 18 year old to take in. At a time in life when one is supposed to be excited about his future, even anxious to charge out from under parental wings and make his mark in the world, it is heart-breaking to see the look in this kid’s eyes…

When every form of political dissent is played off as nothing more than an act of racism, the racial divide is more alive and well than at any point in American history, because it is now nothing more the a tool of the trade for people engaged in a full frontal assault on all things American.

The term “racism” is now limited to the definition of a political hammer, used to advance an agenda and nothing more.

The term “capitalism” (aka economic freedom) is now a dirty word, while most four letter words are common every day dialogue even on TV programs and games designed for children.

He will not be able to control his own health choices, his own standard of living, his role in self-governance, the safety or security of his home, the right to protect his children from evils in the world, or any other part of his future, and he can see all of it with his own eyes.

That look of disappointment and despair in his eyes, kept me awake for hours last night. I woke up this morning still thinking about the hollow dark glaze that was once the bright and lively face of a ten year old that couldn’t wait to drop by and tell me about his day, or his big plans.

Today, he comes searching for any reason to feel good about his future.

In Ten Short Months

Less than a year ago, 44% of Americans had high hopes for Obama. That number is now only 26% and dropping daily.

In the good ole days, it would have been easy to tell this young man what he needed to know about his future, how bright it was, how his hard work and sacrifice would pay off for his family, and how it was his civic duty to directly engage in his government, by the methods taught to me in civics class more than 35 years ago.

But today, I find myself working to come up with anything hopeful to tell this young man. I dare not lie to him, and dare not tell him the truth either. The truth about America’s future should frighten any 40 year old. For an 18 year old, I fear the consequences of such realizations.

Less than a year ago, he was with 65% of Americans who were hopeful about what kinds of “change” Obama & Co. had in mind. Today, he is with the 55% of Americans who now see those “changes” and fear for their future.

He has been through history class. He knows that the federal government was formed at the pleasure of the states and the people, and that ultimately, the people are supposed to be in charge in the United States.

But he also watches as that government engages in immoral, unethical, illegal and unconstitutional acts in its efforts to pass unconstitutional laws that most Americans openly oppose, and he sees not a single American willing to stand up against all odds and speak for him.

After listening to him describe in great detail, his assessment of what he is watching and how that directly impacts his future, afraid to respond at all, as I have two children of my own that will soon reach his age, and I have no idea what to tell them either…

I could think of only one thing to say…

Merry Christmas and a Happy New Year!

And then I told him to join Freedom Force… Because the future of this nation does not rest in the hands of corrupt politicians. It rests in the will of the people! So long as the people have the will to be free, they will find a way!


2009 Year In Review: The Banana Republic of President Zero

These are the times that try men’s souls. The summer soldier and the sunshine patriot will, in this crisis, shrink from the service of his country … Tyranny, like hell, is not easily conquered; yet we have this consolation with us that the harder the conflict, the more glorious the triumph.

--Thomas Paine

The #4 top news story of the year is President Obama's sustained onslaught against a free economy. Below is just a small sampling of TIA Daily's coverage of this story, but the pieces all sum up to one idea: Obama is attempting to turn America into a banana republic, both in our economic system and in our legal system. He spent the first half of this year trying to put all of the elements into place: arbitrary exercise of government control over nominally private companies, leaving every businessman in fear that if he doesn't cooperate with the ruling clique, they will be crushed; a campaign to "cut down the tall poppies" by subjecting anyone who succeeds independently of the state—including the prosperous middle class—to ruinous taxes and fees; a vast welfare patronage system intended to feed a permanent bloc of supporters who are dependent on the party in power; a crushing and unsustainable level of debt to finance it all; and a vast explosion of printed money intended to inflate away the debt.

The only good news: note that most of the stories below are from the first half of the year. Up through July, it was one shocking attack against the free economy after another, with the predictable result: a "stimulus depression" in which panicked attempts at government "stimulus" just drove the economy deeper into a hole. But then it stopped. Why? You stopped it. In reviewing TIA Daily's coverage of this story, I was struck by how stark the cut-off is. After the July 4 tea parties and the beginning of "Town Hall Hell," the onslaught mostly stopped. President Obama thought he would shove through his health-care bill in a few weeks and then move on to his next attack on our liberties. Instead, we stopped him in his tracks and forced him to spend the entire second half of the year trying to push through that one measure. (For TIA Daily's extensive commentary on the health-care bill, see our Health Care Guide.) In the process, I think we have robbed the administration of some of the confidence required to keep setting up its banana republic.

That's why the Obama Banana Republic is only the #4 story this year, while the tea party movement—to no one's surprise, I hope—is story #1.

In keeping with my tradition of highlighting an underappreciated story from last year, the last item below discusses the factor that is actually causing a slow economic recovery: the thrift and industry of private individuals, who are making their own rational plans to bail themselves out of their own financial crises, one at a time, without benefit of press agents.

Finally, I was amused to notice a new pattern, something I hadn't consciously intended but which emerged out of our coverage of the financial crisis and the first year of the Obama administration: the formation of Tracinski's Laws—a body of principles and maxims I have formulated from my observations of this crisis. First there is the Law of Intended Consequences (referred to in item #2 below), then Tracinski's Law of Bailouts (see item #3) with its corollaries, "bailouts are for losers" (not included here, alas, but I think you get the idea) and "planning is chaos" (follow the last link in my commentary on item #3). But the most relevant, going into the election year of 2010, is Tracinski's Rule of American Politics: "The left must be suppressed, hounded, mocked, vilified, and made to feel ashamed of itself." In 2009, we made a good start on enforcing this rule. Let's keep it up through the next two big election days.—RWT


Top Stories of the Year

What Will the Stimulus Stimulate?

The Law of Intended Consequences

Reality Sets In on Wall Street

The War on Prosperity

Economic Dictatorship

The Obama Banana Republic

Cutting Off the "Private Option"

The Savings Stimulus

Top News Stories

Commentary by Robert Tracinski

1. What Will the Stimulus Stimulate? January 29

A lot of us have been angry with the Republicans for the past decade because they have done too little to oppose inexorable increases in federal spending—and in fact, many Republicans have participated in the federal spending binge. But we are about to discover, in the form of an $825 billion "stimulus" bill, that Republican spending was mild compared to the orgy planned by the Democrats now that they are fully back in power.

The Democrats haven't been able to tax and spend as they would like for most of the past 30 years—so they are making up for lost time.

A Wall Street Journal editorial details the pork-barrel spending larded into this bill—particularly for such totally unproductive programs as the National Endowment for the Arts—and concludes that the stimulus was "written based on the wish list of every living—or dead—Democratic interest group." And the Journal also points out that this is not likely to be a one-time increase in spending, since it will be difficult for Democrats to cut back any of these programs from their new, increased levels.

There was at least a veneer of plausibility to last fall's bailout bill—it was not absurd to believe the pouring capital into the banks would stabilize the economy, just absurd to believe that the government could accomplish that task. By contrast, the new stimulus bill barely even pretends to stimulate. The majority of the spending is for welfare programs or congressmen's pet projects, not anything that has an important productive role in the economy.

So what will the stimulus stimulate? It is actually designed, not to stimulate the private economy, but to stimulate the growth of government. In that regard, the best analysis I've seen is the one below, which skips past the distraction of the pork-barrel projects and goes straight to the big picture: the bailout bill was fashioned in the image of the kind of government the Democrats want to create.

It is a major down payment—and given its size, I would say that it is more than a down payment—on transforming America into a Western European socialist welfare state.

"The European Social Welfare State Bill," Jim Manzi, National Review Online, January 27

[I]f this is a "normal" length recession, the spending bill will have the classic problem that fiscal stimulus does—namely, it comes too late to do much good, but right on time to help stoke inflation and mis-allocation of resources that are suddenly in high demand as the economy enters a recovery. And if this is a very long-lasting recession, more like a US 1930s Depression or Japan 1990s "lost decade," then the problem is so long-lasting that we're not really debating a stimulus bill, we're debating a near-permanent shift of control of resources to the government, which doesn't exactly have a sterling track record of success….

It's easy to go through a huge proposal and find what seem like fairly ridiculous line items, so I'll focus on as comprehensive a view as I can of the spending. The CBO reviews each Title (basically, spending area) of the bill, and calls out major items within each Title. Here are all the items that I saw them identify as individual programs with more than $10 billion of projected outlays….

I tried to go quickly through the spending for all categories and crudely map them to the OECD classification system that allows for the comparison of spending across governments in the developed world. The huge categories of spending under this bill that I could map to categories other than "General Spending" are in Social Protection (~$90 billion), Education (~$90 billion) and Environment (~$55 billion). Interestingly, Defense represents only about 3% of the spending in the bill (as opposed to 12% of US government spending overall, or about 3% of French overall government spending as a point of comparison) and Public Safety represents only about 1% of spending in the bill (as opposed to about 6% of US government spending overall, or about 2% of French government spending overall). In other words, the net effect of this bill is to shift the distribution of US government spending as a whole away from defense and public safety and toward social programs: for good or ill, to make the US into more of a European-style social welfare state. Because the amount of spending is so huge, this will be a material, not notional, shift.

2. The Law of Intended Consequences, February 3

Every bank CEO who was foolish enough to accept TARP money did a grave disservice to his shareholders, and he and they are going to regret it. While the Bush Treasury Department swore that the money would not lead to government micro-management of the banks, the new Obama Treasury Department (which contains many of the same people) is quickly reneging on that promise.

Specifically, President Obama has announced that he will begin requiring banks who have Uncle Sam as their new business partner to increase lending, to the Treasury Department's satisfaction. The central economic activity of the banks is about to be taken over by federal bureaucrats.

How does Obama expect the banks to make a profit under these conditions? Here is the shocking answer: he doesn't. TIA Daily reader Mark Kalinowski brought my attention to the article below, and added these comments of his own:

"This past Thursday, Obama proclaimed to financial firms that 'there will be a time for them to make profits' and that 'now is not that time.' This should bewilder any individual with the slightest understanding of economics.

"Profits—and profit margins—measure the fundamental health of a company. The healthier a company is, the more profit/higher profit margin it generates. As such, what Obama is essentially—and openly—saying is that he wants banks to be unhealthy right now.

"This is a prescription for economic disaster. Whether this is a disaster Obama overtly desires (for example, to help him create more dependency on government), or whether he is simply an economic illiterate, I don't know."

I have criticized the conservatives' idea that government management of the economy fails because of its "unintended consequences." Instead, I argued, what we really need to worry about are the intended consequences of government coercion.

This is yet another example of that principle, the Law of Intended Consequences. Obama's "stimulus" will depress the economy, not by accident, but because he intends to stamp out business profits.

"Obama: Big Wall Street Bonuses 'Shameful'," Frank Ahrens, Washington Post, January 29

"Part of what we're going to need is for the folks on Wall Street who are asking for help to show some restraint, some discipline and some sense of responsibility," Obama said. "The American people understand we've got a big hole we've got to dig ourselves out of. They don't like people digging a bigger hole even as they're being asked to fill it up," he said, working both ends of the metaphor.

"There will be a time for them to make profits and a time for them to get bonuses," Obama said. "This is not that time."

Even as Obama spoke, financial institutions trading on Wall Street lost share price.

He added a stern warning: "That is the message I intend to send directly to them and expect Secretary [Tim] Geithner to send to them. He already had to pull back one institution that had gone forward with a multi-million dollar jet plane purchase while receiving [bailout] funds," confirming earlier reports that Geithner had told CItigroup—which has received government bailout money—to pull the plug on a $50 million jet purchase….

This is far-reaching ground Obama and Geithner are treading on—telling private companies where they may set their bonuses and other compensation.

3. Reality Sets In on Wall Street, February 11

From an economic perspective, the place where reality is really setting in is on Wall Street, where traders pushed the Dow down by more than 300 points (and the S&P 500 by about 5%) as they listened to a speech by Obama's new Treasury Secretary.

The immediate reason for this reaction is summed up in Larry Kudlow's commentary on the speech:

According to Merriam-Webster, a "plan" is "a detailed formulation of a program of action; a method for achieving an end." But Mr. Geithner had none of this. As a result, stocks plunged about 250 points. Prominent investment strategist Ed Yardeni described Geithner as an empty suit with an empty plan.

The article below does an even better job of naming the exact reason for the new downturn: continued uncertainty. From the beginning, the biggest problem with the bailouts has been their ever-shifting, arbitrary character, as Treasury bureaucrats like Tim Geithner have decided ad hoc which firms get bailed out and which firms fail, and as Hank Paulson proposed bailout plans only to abandon them, seemingly starting again with some new brainwave every week.

Investors were no doubt hoping that the Obama administration would finally pick one plan and stick to it. Even if it was a bad proposal, it would be something that investors could plan around. There would be a stimulus bill and a new version of TARP, and then maybe the geniuses in Washington would stop coming up with new ideas for a little while, making it possible for investors to make rational calculations about where to put their money.

That is why Geithner's speech yesterday hit the market so hard. It was a clear message that everything will still be in flux for months to come. So Tracinski's Law of Bailouts still applies: government money drives out private money, because government decision-making thwarts private decision-making.

"Five Reasons the Markets Don't Like the Bank Bailout," Jeff Cox,, February 10

Wall Street's message to the Obama administration was clear Tuesday, even if the plan to save the banking industry wasn't.

Unhappy with a lack of clarity in Treasury Secretary Timothy Geithner's new financial rescue plan, investors launched a massive stock selloff, raising further questions about when confidence would be restored to the market….

For someone who ran last year as an agent of change, President Obama's plan for banks seemed to represent more of the same. While investors were looking for some concrete moves on how distressed assets would be taken off banks' books, they instead walked away from Geithner's speech with no indication of how the assets would be priced or who would be buying them.

And as one of Wall Street's oldest maxims goes, the market hates uncertainty….

With so many details left unsolved, much more work will have to be done, again creating uncertainty for investors.

"It's going to be fine-tuned many times over," predicts Quincy Krosby, chief market strategist at The Hartford….

The market is clamoring to know how the government will be able to help banks with their toxic assets while also protecting investors and taxpayers from getting blindsided if the fixes don't work….

With the government unable to stem the tide of uncertainty bedeviling stocks, convincing people to buy will prove all the more difficult.

4. The War on Prosperity, March 23

It was Dick Morris, of all people, who identified the essence of Barack Obama's economic policies. If Lyndon Johnson had the War on Poverty, Obama has launched a War on Prosperity—a constellation of policies that target anyone who succeeds, prospers, and makes money.

The number that sums up Obama's outlook is $250,000. In his tax policy and in his attempt to impose caps on salaries and bonuses for people who work at bailed-out banks, that is the number that keeps popping up.

The message coming out of the White House and Congress right now is: make more than $250,000 and you're fair game. You have no right to any income over and above that amount, so we have a right to tax it away or regulate it out of existence as we see fit.

So far, however, the president and Congress have been able to directly control executive pay only at financial institutions that were foolish and unprincipled enough to accept federal bailout money. Now the inevitable next step has come: the Obama administration has put forward a proposal to regulate executive pay at all financial institutions—and, by implication, all publicly held companies.

This is a moratorium on ambition and success.

"Administration Seeks Increase in Oversight of Executive Pay," Stephen Labaton, New York Times, March 22

The Obama administration will call for increased oversight of executive pay at all banks, Wall Street firms and possibly other companies as part of a sweeping plan to overhaul financial regulation, government officials said….

Officials said the proposal would seek a broad new role for the Federal Reserve to oversee large companies, including major hedge funds, whose problems could pose risks to the entire financial system. It will propose that many kinds of derivatives and other exotic financial instruments that contributed to the crisis be traded on exchanges or through clearinghouses so they are more transparent and can be more tightly regulated. And to protect consumers, it will call for federal standards for mortgage lenders beyond what the Federal Reserve adopted last year, as well as more aggressive enforcement of the mortgage rules….

One proposal could impose greater requirements on company boards to tie executive compensation more closely to corporate performance and to take other steps to ensure that compensation was aligned with the financial interest of the company.

The new rules will cover all financial institutions, including those not now covered by any pay rules because they are not receiving federal bailout money. Officials say the rules could also be applied more broadly to publicly traded companies, which already report about some executive pay practices to the Securities and Exchange Commission.

During the presidential campaign, Mr. Obama repeatedly urged regulators to adopt new rules to give shareholders a greater voice in setting executive pay for all public companies. And last month, as part of the stimulus package, Congress barred top executives at large banks getting rescue money from receiving bonuses that exceeded one-third of their annual pay.

5. Economic Dictatorship, April 2

The big news of this week is another major stage in the arrival of economic dictatorship in the United States: President Obama using federal loans to GM and Chrysler as a pretext to seize de facto control over the automobile industry, replacing GM's CEO and rearranging its board of directors, and dictating that Chrysler negotiate a merger with Fiat.

He even announced US government policy toward the warranties on GM vehicles. As an incredulous blogger at puts it:

Today, the President of the United States is expected to make significant announcements about GM's warranty policy. No, that's not a typo, and yes, it's remarkable. I didn't say the President of General Motors, I said of the United States.

Car and Driver's report that Obama had ordered GM and Chrysler to withdraw from participation in NASCAR turned out to be an April Fool's Day joke. But as Investor's Business Daily points out, who can tell any more what is real and what is a parody?

This story has been out there for a few days, so I found that by the time I got to it, a lot of very good things had already been said by the bloggers and a few newspaper columnists.

The main article linked to and excerpted below, from the Detroit News, names the overall pattern: Obama has set himself up as "CEO-in-chief" of America's corporations, with the ability to override and overthrow the CEOs selected by the corporations' actual shareholders. And as the article also points out, this control will be exercise for political rather than economic ends—particularly the promotion of environmentalism.

In the Detroit-based auto industry, a crisis crystallized by $4-a-gallon gas, the credit crunch, and plunging consumer confidence offers a Democratic White House with close ties to the environmental wing of its party a golden opportunity to turn the General "green"—even if doing so means beggaring the retiree health care promises of hourly workers.

As for the workers, though, Larry Kudlow points out who wasn't fired by the Obama team.

And why isn't Obama's special auto task force ordering a replacement for Ron Gettelfinger, the UAW's president? Weren't their oversized pay and benefit packages a big part of the problem? Well, that's never gonna happen. The election power of the union is too strong. But this does reveal the political nature of these government bailout operations.

The main feature of this takeover of the US auto industry is that it has no legal basis whatsoever. As Terence Jeffrey sums it up, "Because Congress did not authorize the president to spend money bailing out automakers, the president is not authorized to spend money bailing out automakers. Or as the Constitution puts it, 'No money shall be drawn from the treasury, but in consequence of appropriations made by law.'"

The most devastating—and wholly correct—conclusion is offered by economist David Henderson:

Sean Hannity and other critics keep criticizing Obama for his socialist leanings. But the more accurate term for many of his measures, especially in the financial markets and the auto market, is fascism.

He then quotes an accurate definition of the fascist approach to economics.

Where socialism sought totalitarian control of a society's economic processes through direct state operation of the means of production, fascism sought that control indirectly, through domination of nominally private owners. Where socialism nationalized property explicitly, fascism did so implicitly, by requiring owners to use their property in the "national interest"—that is, as the autocratic authority conceived it.

That is the economic system we are now headed toward—and we're heading there very rapidly.

"Obama Effectively Becomes CEO-in-Chief," Daniel Howes, Detroit News, March 31

President Obama says he wants to save America's auto industry. He says General Motors Corp., under a new CEO, has 60 days to sharpen its restructuring or submit to bankruptcy. He's giving Chrysler LLC 30 days to complete an alliance with Fiat SpA of Italy lest Detroit's No. 3 carmaker find itself in a federal court.

But what the president didn't say Monday, as he detailed his administration's prescription for Detroit's two sickest automakers, is what he actually did—oust a sitting CEO, GM's Rick Wagoner, and begin the process of remaking a board of directors deemed to have done too little, too late to prevent GM's slide into the arms of the federal government….

In one swift act, the president effectively overruled the oversight and fiduciary responsibilities of GM's directors, duly elected by the automaker's shareholders, because he could—and the federal government, officially a lender of $13.4 billion to GM, doesn't own a single share of the automaker.

A chilling message? It should be if you run a bank recapitalized with Treasury money, lead an auto supplier likely to tap into a new $5 billion federal fund, are considering a pitch for a government bailout or are Fritz Henderson, the GM president-turned-CEO who has two months to accelerate the automaker's restructuring.

"Firing a CEO is usually what a board does," says Peter Henning, a law professor at Wayne State University who worked in the enforcement division of the Securities and Exchange Commission. "We now have a CEO-in-chief...overseeing large sectors of the economy. We are certainly in a brave new world."

And it looks like this: the federal government, in a bid to "save" companies determined crucial to the economy, is prepared to use whatever thin financial connections it has to them to broom management, void employment contracts, reload boards of directors and, if necessary, force bankruptcies….

The issue is principle and the lengthening arm of government into commerce. How can corporate governance and the fiduciary responsibility of directors to shareholders be so easily usurped to satisfy the political exigencies of the day? Stunning is too mild a word to describe the precedent set here.

6. The Obama Banana Republic, May 7

In yesterday's TIA Daily, I mentioned a lawyer's accusation that the Obama administration had threatened to abuse its power to ruin one of the firms that initially refused to accept the administration's terms in the Chrysler restructuring. That firm, Perella Weinberg, has issue an odd non-denial denial of this claim.

Suggestions have been made that the Perella Weinberg Partners Xerion Fund changed its stance on the Chrysler restructuring due to pressure from White House officials. This is incorrect. The decision to accept and support the proposed deal was made by the Xerion Fund after reflecting carefully on the statement of the President when announcing Chrysler's bankruptcy filing. In considering the President's words and exercising our best investment judgment, we concluded that the risks of potentially severe capital loss that could arise from fighting this in bankruptcy court far outweighed any realistic potential upside.

We have a very specific mandate from our investors, and that is to carefully weigh investment risks and rewards. It is not our investment mandate to pursue political or risky legal campaigns with our investors' money.

Remember that the "statement of the president" that swayed their decision was his condemnation of evil "speculators." No pressure from the White House there!

This is, of course, precisely the kind of denial a firm would issue if it really were threatened and was too frightened to testify against its tormentor. Translated into more familiar terms, this non-denial denial might read something like this:

Suggestions have been made that we chose to sell a majority interest in our casino due to pressure from Corleone family officials. This is incorrect. The decision was made after reflecting carefully on the statement of Don Corleone that those who refused to sell to him were "dirty rats." In considering the Godfather's words and exercising our best investment judgment, we concluded that the risks of potentially severe capital and personnel loss that could arise from fighting this outweighed any realistic potential upside.

Call it an offer they couldn't refuse.

The only good news is that everyone is now wise to the Obama administration's racket, and many people are naming it openly.

Michael Barone best captures the flavor of the thing when he summarizes the reason the TARP lenders caved in: "Nice little bank ya got there, wouldn't want anything to happen to it…. We have just seen an episode of Gangster Government."

In Forbes, Thomas F. Cooley puts it more dryly: "Many investors are sitting on the sidelines, as is much money. Why? Because it is impossible to know what the rules of the game are. And that's because the administration and the Congress keep changing the rules in capricious ways in pursuit of larger political objectives."

George Will simply describes the Obama administration as a "capricious government," while Megan McArdle invokes the same banana republic analogy I used:

[I]t's now clear that the worry many of us had at the time of the bank bailouts has come true: the government is using its intervention in the banking system to pressure banks to give special deals to the government's special friends….

We are hardly Zimbabwe, or even Venezuela. But if we keep using TARP to create a sort of "Most Favored Borrower" status, we'll erode the safeguards that keep election to office in America from being the kind of giant spoils system that's common in much of the world.

But the best overview of the Obama administration's economic policies is the one below. Dick Morris is far from being a staunch pro-free-marketer. His political ideal is also his most famous client: Bill Clinton in 1992—a non-ideological pragmatist who offers a "third way" between capitalism and socialism. Yet Morris is proving to be a very sharp-eyed critic of Obama's socialism, which is apparently too ideological for him.

But he stops short in one respect. He correctly describes Obama's policy as a "balance of government control and private nominal ownership." There is a name for this combination, for a system in which the government does not officially nationalize companies but gives them orders telling them what to do. This is the economics of fascism.

"How Obama's Socialism Works," Dick Morris and Eileen McGann, Jewish World Review, May 6

President Obama's vision of the future is, apparently, an economy guided, steered and—when the occasion demands—commanded by the federal government. Some of the companies will remain private. Washington will take others over. But all will look to the White House, as to an orchestra conductor, for signals as to how and when and where to proceed.

This summary is the vision that emerges from the Chrysler bailout….

[T]his little vignette shows exactly what the new rules of the game will be under this administration. It won't be Soviet style socialism or Reaganesque capitalism. The system will more resemble the Japanese arrangement where MITI, the Ministry of Trade and Industry, informally guided companies and told them what to do. In Japan, a nod usually suffices to command. In the United States, one has to use a hammer. But the result will be the same: compliant capitalism.

Companies will not look out for their shareholders or their employees or even their customers so much as watch the smoke signals from Washington to decide what to do. The markets won't control decisions. Washington will….

The strong-arming that obviously led up to the Chrysler deal will also be typical of the Obama industrial policy…. While terrorists need not fear any violation of their constitutional rights, CEOs of Fortune 500 companies will not be so fortunate.

7. Cutting Off the "Private Option," May 12

The great danger of Obama's first year in office is that the left is moving forward on so many fronts that we will be hard pressed to fight and win every battle—and losing even one of them means losing an enormous amount of our liberty.

Thus, while we are trying to fight off total control of the economy in the name of environmentalism, the Democrats are also attempting to make us dependent on the state in another crucial area of human life: medical care.

The Wall Street Journal editorial below describes the means by which government-controlled medicine is about to be forced upon us. Democrats have proposed a "public option," which allows individuals who meet certain criteria to "choose" government-provided, government-subsidized health insurance.

But as the Journal points out, once this "option" is established, it will expand until it crowds out private insurance, cutting off any "private option"—and making us all dependent on the state.

So here is the future proposed by President Obama: when you get a job, you will be pressured to join a labor union backed by the government; if you want to take a mortgage to buy a house, you will borrow from a bank backed and controlled by the government; you will send your kids to a public school and finance their college education with student loans provided by the government; and when you get sick, you will rely on government funding and be treated at government-funded, government controlled facilities.

Comprehensively, in one aspect of life after another, government is taking over and the "private option" is being eliminated.

"Republicans and the 'Public Option'," Wall Street Journal, May 11

This new entitlement—like Medicare but open to all ages and all incomes—would quickly crowd out private insurance as people gravitated to heavily subsidized policies, eventually leading to a single-payer system. So Democrats are trying to seduce diffident Republicans with a Potemkin compromise. A "soft" public option would limit enrollment only to the uninsured or those employed by small businesses, or include promises that the plan will pay market rates….

The truth is Democrats know that any policy guardrails built this year can be dismantled once the basic public option architecture is in place. The White House strategy is to dilute it just enough to win over credulous Republicans. That is what has always happened with government health programs.

When Medicare was created in 1965, benefits were relatively limited and retirees paid a substantial percentage of the costs of their own care. But the clout of retirees has always led to expanding benefits for seniors while raising taxes on younger workers….

Any new federal health plan will inevitably follow the same trajectory, no matter how much Republican Senators might claim they've guaranteed otherwise. The Lewin Group consultants estimate that 119 million people who now have private insurance could potentially be captured by the government under the Obama public option. This is on top of the 90 million already in Medicare or Medicaid. This would guarantee a spending explosion that would over time lift federal outlays as a share of GDP into the upper 20% range or higher. Republicans would spend the rest of their days deciding whether to vote for tax increases to finance this, or stand accused of denying health care to the middle class….

This health-care debate isn't like the "stimulus" bill, which was largely about short-term spending and deficits. This one is about whether to turn 17% of the U.S. economy entirely and permanently into the arms of the government. For Republicans, this is about whether they still stand for anything at all.

8. The Savings Stimulus, June 23

Meanwhile, the American people are, as usual, setting a good example for their leaders. As the article below describes it, the American people have spontaneously adopted a radical new strategy for solving their own financial crises: "To generate the savings, consumers ratcheted down their spending faster than their incomes were falling." What will they think of next?

This is the real "stimulus" that will eventually make an economic recovery possible: the increased savings of the American people as they make rational plans for their own individual economic well-being.

"Tapped Out Consumers Rediscover Savings," David M. Dickson, Washington Times, June 22

The personal savings rate has been rising steeply this year as formerly profligate consumers frantically try to recoup part of the $14 trillion in losses they suffered since mid-2007 from the bear market and the bursting of the housing bubble….

What a difference a year makes. In April 2008, four months after the recession began, Americans were saving none of their after-tax incomes. A year later, after an additional 5 million jobs were lost, after home prices continued to plummet and after the stock market recently hit a 12-year low, the savings rate jumped to 5.7 percent in April—its highest level in 14 years.

To generate the savings, consumers ratcheted down their spending faster than their incomes were falling….

"Americans have learned a cruel, cold, hard lesson. People are scared. And that's led them to replenish their savings because they now realize that their retirement nest eggs will no longer increase on automatic pilot," Mr. Baumohl said….

Some economists emphasize the "paradox of thrift," a concept first developed during the Great Depression by John Maynard Keynes. If everybody consumes less to save more, then nobody will be better off because falling consumption will lead to declining output, which will lead to decreasing wages and rising unemployment. In the end, savings will not have increased—thus the paradox.

Over the long run, however, economists agree that a rising American savings rate produces huge benefits.

More savings could be channeled into greater business investment, which raises productivity, the basic building block for a rising standard of living.

Robert Tracinski writes daily commentary at He is the editor of The Intellectual Activist (TIA) and contributor to The Freedom Fighter's Journal