The Illustrated Road to Serfdom

I've linked this before, but since it's becoming every more pertinent as the days pass by, I'm linking it again. Do you want to see where we are headed? Right down the Road to Serfdom.

Federal Government Turns into California

Leave it to Jennifer Rubin to speak the truth (must read). We've got two ways (actually three) to pay for the idiotic bill that just passed the inept, cringing, cowardly Congress. We can raise taxes ($8500 per year to cover a one trillion deficit), or we can cut spending (yeah, like that is going to happen). The only other way out is to print money to pay for it. Who knew any political entity could be as equally fiscally irresponsible as California?

But the options are clear: radically cut benefits or radically raise taxes. There is no mysterious solution to “assuring” social security’s future or to narrowing the budget gap. The problem was daunting before and we have now made it much worse, because we have widened the chasm between receipts and spending and because the large stimulus bill and increased debt, as CBO predicted, will likely slow economic growth.

Watch for politicians to be shocked, shocked! when their policies further slow/depress the economy, and then watch as they turn to a hodge-podge of regulations (price controls) to attempt to change things (all the while making them worse). The rest of my working life (if not the rest of my life) is going to be VERY interesting as we march down The Road to Serfdom.

Charging Down the Road to Serfdom

While we would hope that some politician besides Ron Paul would read The Road to Serfdom by Frederik Hayek we are not holding our breath. The New York Sun has the best analysis of the expropriation of Fannie Mae and Freddie Mac of anyone. The Sun makes a fascinating—and to my mind accurate—point when they say:

What the federal regulators acknowledge they are objecting to in actuality was not the companies' recklessness with capital but their care with it. "Freddie Mac and Fannie Mae, in order to try to build capital, have continued to raise prices and tighten credit standards," Mr. Lockhart said. And what exactly is wrong with that? Had that been done a few years ago, there might be fewer foreclosures now. Mr. Paulson, the nation's newly crowned chief mortgage lender, even announced plans to expand the companies' portfolios of mortgage-backed securities through the end of 2009 — taking on even more risk.

Essentially what the government is doing is taking over Fannie and Freddie so they can offer more loans at cheaper prices and thereby entice more unqualified people to take on housing loans which they cannot afford and make taxpayers take the risk for all of this. Meanwhile, they've set the gold standard of government expropriation of firms that it deems appropriate. Hugo Chavez would be proud.

Slouching Towards Serfdom

Marketwatch has an article listing 11 reasons why America is the top socialist economy. Unfortunately, they are correct. We are marching down Hayek's Road to Serfdom quite rapidly.