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Columbus and the War on Western Civilization

George Noga

“A nation trafficking its own children is more to be condemned than the buyers.” (Voltaire)

Columbus and the War on Western Civilization

By: George Noga – October 9, 2022

This is a special Columbus Day posting; read our 2019, 2020 and 2021 Columbus Day posts on our website: www.mllg.us. Christopher Columbus is the lightning rod for the progressive war on western civilization; hence, it is appropriate to address criticisms leveled at him. We also intrepidly tackle the issue of slavery, which is central to the war on western civilization as well as to Critical Race Theory and to the 1619 project. Note: For those interested in this subject, I highly recommend “The War on the West” a new book by Douglas Murray, from which some of the material herein is sourced.

What if the Chinese or Arabs had Discovered America?

Progressive Svengalis use Columbus to brainwash our children to despise western civilization. They condemn Columbus for subjugating the native population and for genocide in introducing infectious diseases. What was the West supposed to do, leave America alone and keep it a secret? When the Chinese and/or Arabs would surely have come, things would have been far worse. What if an advanced Native American society had discovered paleolithic Europe? What would happen today if we discovered a resource rich planet inhabited by primitive people? No technologically advanced society has ever encountered an aboriginal population and behaved any better. It is disingenuous to condemn the West for innate, unchanging human behavior.

In the 15th century no one understood infectious diseases; contagion from outsiders to the native population was inevitable no matter who discovered America. Europeans had acquired immunity from many diseases because of their diversity and also travel being more commonplace compared to the mostly isolated indigenous population of the Americas – who were thus highly vulnerable to disease. Further, many of the infectious diseases brought from Europe originated in Asia. There is not one record extant that shows any American or European government had a policy of genocide.

Slavery and Western Civilization

Slavery is evil and is to be condemned always and everywhere. It is right and proper for schools to teach our children about the history and evils of slavery in America; that is not an issue. The problem is lack of context. Progressives, who run government schools, teach only about slavery in America and they fail to inform students about mitigating factors. Consequently, children in the USA believe slavery occurred only in America and are ignorant of the often-heroic efforts to abolish it. In the following paragraphs, I provide much needed context, including much that may surprise you.

Progressives condemn slavery only in the West and divorce it from all contexts. Slavery has been a constant throughout history. From the 15th century to the 19th century, 10 million slaves were shipped from Africa to the West; during that same time, a far greater number (15 million) was shipped east to the Ottoman Empire. Instead of being forcibly captured by European slavers, most slaves were sold by other Africans, even by their own families, making them complicit in the slave trade. The slave trade could not have succeeded without the active support of African elites.

There are no descendants of the slaves sent east, because they were all castrated and then killed when their usefulness ended. Thus, eastern nations that imported 15 million slaves do not have the same legacy as the USA with tens of millions descended from slaves. Again, this is because the Ottomans castrated and killed their slaves. As late as the 19th century, Barbary pirates captured and enslaved over one million Europeans. Slavery exists today in Mauritania, Ghana, South Sudan and many other places. There are more slaves today (50 million) than there were in the 19th century.

As Voltaire stated, selling one’s neighbors, and even one’s own

children, into slavery is more condemnable than buying them.

There were many heroic actions taken by the West to end slavery. England abolished slavery in 1807 and then used its navy to wipe out the slave trade throughout much of the world. England established a naval squadron in west Africa that grew to include 20% of its fleet. From 1808 to 1860, the West Africa squadron captured 1,600 slave ships and freed 150,000 slaves. The Royal Navy lost over 1,500 men in that operation.

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We rightly celebrate the achievements of western civilization – including those of Christopher Columbus. Happy Columbus Day 2022 from MLLG to all our readers!

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The 1619 Project is the subject of our next post on October 16th.
More Liberty Less Government – mllg@cfl.rr.com – www.mllg.us
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Annus Horribilis Third Quarter Update Interest on the National Debt Set to Explode

George Noga

Within a year, interest on the national debt will consume 20% of tax revenue.

Annus Horribilis Third Quarter Update

Interest on the National Debt Set to Explode

By: George Noga – October 2, 2022

This post updates our forecast for this year, which we have dubbed an annus horribilis. Please read our prior posts of 1/1/22, 4/3/22, 5/15/22 and 7/10/22 in this series; they are easily available on our website: www.mllg.us. We also provide a truly horrifying update in our continuing coverage of America’s spending crisis.

On New Year’s Day we wrote this would be a year of geopolitical, economic, political and investment horrors; unfortunately, we were right. Looking ahead, we see stagflation, i.e. inflation combined with stagnation. Inflation cannot be brought under control until the federal funds rate exceeds the inflation rate. Today, inflation is 8.3% while the federal funds rate is 3.00% to 3.25%. You can do the math. Markets may not bottom out until well into 2023. However, if we are in the opening stage of the spending crisis, markets may not hit bottom for years. The worst is yet to come.

To the extent our present inflation is caused by excess spending (fiscal policy), it can be ended only via fiscal policy, i.e. revenue and spending brought into long-term balance. Simply jacking up interest rates to create a recession will not be enough.

Spending Crisis: High Interest Rates Devastate the Federal Budget

A long dormant, but intractable and devastating peril has reared its ugly head; interest on the national debt is poised to skyrocket. Interest on the debt for the 12 months ended May 31, 2022, was $670 billion. There are $3.7 trillion of Treasury bills and $2.4 trillion of Treasury notes maturing within one year. Interest rates on the new debt will be 3% higher, equal to $200 billion more in interest as these bills and notes are replaced. Our interest cost will be $870 billion (20% of revenue) within a year; this is more than we spend on defense ($746 billion) or Medicare ($700 billion).

In 2024 interest on the debt will hit $1 trillion – on its way to the moon.

Credit card companies frequently offer low, or even zero, “teaser” interest rates, after which the rates skyrocket. America has benefited from teaser rates for many years. But now the teaser rates have ended, and rates are surging higher and higher. This is akin to taking out a negative amortization adjustable-rate mortgage on the US economy.

We are experiencing a perfect fiscal storm. The stock market decline will reduce capital gains tax collections by $400 billion. As additional debt matures in coming years, higher interest rates will cost about $200 billion per year more – each year. The recession will further reduce tax revenue and create a huge deficit that balloons the debt. In 2024 interest on the debt will reach $1 trillion – on its way to the moon.

Who will be the last person in America to buy a US Treasury bond?

America is trapped in a vicious circle. Higher interest rates increase the cost of borrowing. Interest expense skyrockets, leading to more borrowing, leading to more interest – until the music stops. The US has been on an unsustainable fiscal path for a long time; we have sowed the wind and now we are about to reap the whirlwind.

The US is on a clear path for interest to consume 25% to 30% of all federal revenue within a few years. What will it take for people to quit buying US Treasury debt? Who will be the last person in America to buy a US Treasury bond?

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Watch for our uber-special Colombus Day posting next Sunday.

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Common Sense About Preventing School Shootings – Sacrificing Children on the Altar of Gun Control

George Noga

It’s time to put gun control aside and to do what is possible to save lives now.

Common Sense About Preventing School Shootings

Sacrificing Children on the Altar of Gun Control

By: George Noga – September 25, 2022

In the wake of the Uvalde tragedy, we present a fresh look at what can be done to prevent school shootings. Sadly, the political reaction following school shootings has become a kabuki: progressives, captive to their gun control dogma, clamor for anti-gun legislation. That always is a non-starter. No meaningful changes are enacted, and schools are just as vulnerable as prior to the latest tragedy. That must change.

We begin with some perspective. Most gun deaths (55%) are suicides. Mass shootings constitute less than 1% of gun deaths. There have been 13 mass school shootings in the in the past 56 years, 1 every 4-5 years. Even though school shootings are rare, they generate great horror due to the nature of the victims. That, along with saturation media coverage, gives the impression they are more frequent than they actually are.

Solutions That Will Not Work

Gun control is a liberal shibboleth not shared by a sizable majority of Americans. That makes it impossible to pass stricter gun laws. Even if meaningful laws could be passed, they likely would be unconstitutional. Moreover, if they became law, they would be largely ineffective. By demanding gun control, liberals make the perfect the enemy of the good. They must put gun issues aside and do what is possible to save lives now.

Red flag laws won’t work. There were warnings aplenty prior to many school shootings, particularly Parkland and Uvalde. Red flags included summonses for police, foreboding social media postings, school suspensions, anti-social behavior, cruelty to animals and firearm purchases. Simply put, government can’t be trusted to enforce red flag laws; they would muck it up as they do everything else. Also, red flag laws take away a constitutional right from someone who has not been charged with any crime.

Solutions That Will Work

Universal school choice gives families control of where to school their children; they can choose schools with strong safety protocols, including the presence of firearms in the hands of trained school personnel. Competition will soon force other schools to follow suit. Perhaps some schools will advertise themselves as gun-free zones to accommodate children from progressive families. That would present an interesting dilemma for liberals. Would they risk their own children for their anti-gun religion?

Cultural pathologies and personal pathologies are inextricably linked

Harden schools to strictly control entry. A perimeter fence combined with only one point of ingress (with double doors such that a person could enter only one door at a time) could be effective both as a deterrent and for stopping shooters. The cost would be minimal, and it could be completed in weeks. It could be funded with leftover dollars from all the largess doled out to states for pandemic assistance.

Abolish gun-free zones as part of a well-considered plan. Guns in the hands of trained school personnel create serious complications for wannabee shooters. They complicate the calculus of a shooter looking for a soft target. Guns would be a powerful deterrent and a gigantic speed bump. They also provide an immediate response as opposed to waiting 10-15 minutes for police. Finally, it would minimize any casualties.

Other remedies include: (1) improve the culture; when the spectrum of acceptable behavior degrades, those at the margins go off the rails. Our highly toxic political culture of personal destruction, mainly as practiced by progressives, has removed the guardrails from our civilization. There is an inextricable link between cultural pathologies and personal pathologies. (2) reduce the copycat effect by dialing down saturation media coverage; and (3) institutionalize the violently mentally ill.

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Whenever there is a school shooting, America undergoes a national catharsis, but in the end nothing ever changes. Inevitably, we get derailed by progressive anti-gun paranoia. Regardless of one’s position on guns, let’s agree to separate the gun debate from school shootings. Liberals are making their idea of perfect the enemy of an immediate good. They literally are sacrificing America’s school children on the altar of gun control.

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Next week’s post about the spending crisis is one for the ages.

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Constitution Day 2022 Special Posting . . . What Would the Founders Think of America Today?

George Noga

Our founders would feel right at home with the politics of the twenty-first century.

Constitution Day 2022 Special Posting . . .

What Would the Founders Think of America Today?

By: George Noga – September 18, 2022

Happy Constitution Day! Our Constitution was 235 years old yesterday. I recently conducted a thought experiment to see what the signatories of the Constitution would think if they could see America today. Their first reaction would be one of surprise that it has endured this long and has been amended only 16 times – when counting the first ten amendments as one and cancelling out the two prohibition amendments – or about once each generation. The next oldest charter of government is that of Norway, which is 38 years younger. Over 50% of all constitutions fail within twenty years.

Scientific – Technical – Economic Progress

The founders would be blown away by the scientific and technical progress of the past 235 years. They would look on in amazement at the advances in medicine, dentistry, drugs, air travel, satellites, space exploration, consumer electronics and computers. They would marvel at the decoding of the human genome and that we supply some of our energy by splitting the atom. They would gape when informed that heart and organ transplants are performed routinely and that computers beat humans at chess.

The founding fathers would scarcely believe the economic gains; ordinary Americans now live better than the nobility of their era. They would be awed that extreme poverty no longer exists and that even poor Americans live better than the average European. Our poorest state (Mississippi) has per capita income (adjusted for cost of living) higher than Sweden which, if it were part of the USA, would be our poorest state.

Governmental Progress (Oxymoron Alert)

When the founders turned their gaze on government, they would be flabbergasted that the size of the federal government is now 35% of GDP and, when including state and local government, is over 40%. This ratio was less than 5% at the time the Constitution was signed, and as recently as the 1930s it was only 11%.

The framers’ greatest shock would be the toxic social climate of the nation. In colonial times (250 years ago) it was considered safe for a woman to travel alone on horseback at night, even in unpopulated areas. Today, in many of our major cities, no one is safe even in daytime. The literacy rate in New England in 1787 (when the Constitution was written) was 90%. In 2022 the US adult literacy rate is 79% and 54% of adults are below sixth grade level. Americans are much less safe and literate than 235 years ago.

The founders would be bewildered if they were asked which pronouns they used and told Supreme Court nominees could not define a woman. They would be flummoxed about the meaning of a birthing person, men menstruating and becoming pregnant, women competing in men’s sports and the existence of 60 genders – and counting. They couldn’t comprehend a debt to GDP ratio of 110% and the certainty of a future debt default. I could go on ad infinitum in this vein if not for space limitations.

What if Government Progress Mirrored Science and Technology?

Imagine if government had advanced as much as science during the past 235 years. There would be no strife in the world; everyone would be healthy and wealthy; crime would be a rarity, cities would be safe, literacy would approach 100%. There would be universal school choice and governments would spend within their means. Every American would be free to pursue his/her dreams without government interference.

Why has government not advanced since our founding – and likely even regressed? The answer lies in unchanging human nature, which is the same today as during the times of Pericles and Cicero and also at the time of our founding in 1787. The drafters of the Constitution would feel right at home with the politics of the twenty-first century. As in 1787, human nature forces our politics to descend to the lowest common denominator. That explains the race to the bottom, our politics of personal destruction, personality over policy and targeting voters based on race, income, gender and age.

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America’s Constitution has survived 235 years because our founding fathers had a fundamentally correct understanding of human nature, which is unchanged from 1787 to 2022. They wrote a constitution that incorporates effective checks and balances and separation of powers. Even today, 235 years later, it remains the best document ever crafted by the hand of man to define the relationship between man and the state.

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Next on September 25th, we take on the issue of guns and schools.

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The Borg and Progressives: Collective Mentality

George Noga

The Borg, like progressives, demonstrate the pathos of a collective mind.

The Borg and Progressives: Collective Mentality

By: George Noga – September 11, 2022

Today is the twenty-first anniversary of the terrorist attack on America; it succeeded only in waking a sleeping tiger. However, there is an unrelenting and ongoing attack on our constitutional republic by collectivist forces, and it is succeeding. It already has corrupted and assimilated most of our institutions: entertainment, media, education, science, sports, immigration, criminal justice, academia, corporations, fact-checkers, election systems, politics, economics, religion, military and social media.

What would America look like if the progressive collective succeeded in assimilating everything? We don’t have to imagine; science fiction provides the answer. Star Trek presents an optimistic vision of the future. Earth eliminates poverty and strife, becomes an ecological paradise and a civilizing force throughout the galaxy. However, Earth faces a deadly foe that assimilates everything in its path into its collective hive.

The Borg present the most disturbing example of full-fledged collectivism extant, surpassing Huxley’s Brave New World and Orwell’s 1984. The Borg are a race of cyborgs that hardwires its hive mentality into the brain and central nervous system of every Borg. A network connects all Borg brains with each other, and they share a collective mentality. Borg are assigned numbers rather than names. No Borg thinks for itself and has no identity outside of the hive. It is impossible to reason with them.

The Borg provide a chilling insight into a collective mentality; they offer individuals a stark choice between submission and the force of the collective. Once assimilated, all individuality is absorbed and subsumed, and they become drones. They are essentially parasitic as they grow by assimilating other people, cultures and technology. The Borg are like communism, fascism, socialism, multiculturalism, extreme environmentalism, climate madness, wokism and every other form of collectivism. It must enslave its people, force everyone to think alike and pillage and plunder others to survive.

Twenty-first Century Progressives Mimic twenty-fourth Century Borg

Go back to the two prior paragraphs and substitute “progressive” for “Borg“. The similarities are stunning. Collectivism demands unflinching obeisance to its narratives. Progressives have a collective mentality and use the same talking points each day, just as though connected to the hive. They seek to control every aspect of life through coercion and repression. They do not think for themselves, and it is impossible to reason with them; they can only recite talking points and call you hateful names.

Progressives believe absurd contradictions, disdain facts, harbor utopian fantasies and have obsessive desires to control others and to take from them. They have antipathy for all who differ. Choice, by which they mean only abortion, is their mantra. However, progressives do not believe a woman should be free to choose to own or to carry a gun, where to school her children or whether or not to join a labor union. Liberals exist inside a hive – conjoined mentally with all other assimilated drones. Life inside the progressive hive is easy. There is no identity except that derived from the hive. There are no values but hive values; there are no thoughts but hive thoughts.

Resistance is not futile

In Star Trek, the Borg mantra is “Prepare to be assimilated; resistance is futile.” Today, progressivism is very close to assimilating every institution in America as listed in the lead paragraph. In Star Trek, humans eventually triumph over the Borg by exploiting their weaknesses, i.e. their lack of individuality and obeisance to groupthink.

We at More Liberty Less Government will continue to fight against progressivism and against all other misanthropic forms of hive collectivism. Resistance is not futile!

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Next up September 18th is our Constitution Day posting.

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Labor Day 2022 – MLLG Special Posting . . . Economic Liberty – Not Government – Creates Wealth

George Noga

Who do you trust to look out for children: the government or their parents?

Labor Day 2022 – MLLG Special Posting . . .

Economic Liberty – Not Government – Creates Wealth

By: George Noga – September 4, 2022

I hope you enjoyed summer. We begin with a preview of coming attractions. This fall we take on some radioactive issues such as homelessness, guns and schools, the 1619 project and slavery. There will be provocative posts for Columbus Day, Thanksgiving and Christmas. We will present our fearless forecast for the November election. We also revisit our three signature issues of climate change, spending crisis and school choice – each with new insights and analysis. My favorite post compares progressives to the collective hive of the Borg – you will find the similarities downright scary.

Economic Liberty and Cheap Third World Labor

On Labor Day we rightfully celebrate the dignity of work. We also should celebrate capital, which makes labor more productive and raises wages. Labor alone has wrought only poverty; but when capital alloys with labor, it puts labor on steroids and ends poverty. Labor Day also brings predictable condemnations of cheap third world labor from labor leaders, the media and progressives, who believe all of the following.

  1. Capitalists choose to pay subsistence wages amidst deplorable conditions.
  2. Profits could be used for higher wages and better working conditions.
  3. Child labor always is exploitative and condemnable.
  4. Globalization and free trade harm the poor in the third world and the US.
  5. Boycotts of companies using third world labor help foreign and US workers.

All the above beliefs are economically illiterate. Third world workers already are at subsistence; anything that increases the cost of employing them is at their expense. The higher the price of anything, the less will be bought; this applies to labor in developing countries. Improving the condition of workers requires economic liberty and minimal interference from government. Third world workers voluntarily (even eagerly) take low paying jobs because they are preferable to the devastating rural poverty they fled.

Time and time again, in Hong Kong, South Korea, India and China, workers are much better off after only one generation. Even Japan once was a third world country; I can remember when “made in Japan” was an eponym for shoddy and cheap. Dickensian England was indeed grim, but after one generation wages exploded, life expectancy and literacy soared, child nutrition and mortality improved, child labor receded, school enrollment surged and great prosperity, continuing to this day, was unleashed.

Third world workers (yes – including children) are better off working than the life they left behind. It was no different in the United States. My uncle began working in the coal mines at age six because small children with lithe bodies could crawl into small spaces. Child labor was not uncommon in early twentieth century America, but parents always remove children from the labor force just as soon as humanly possible and long before child labor laws are enacted, which was not until 1938 in the USA. Who do you trust to have the best interests of children at heart – government or their parents?

Globalization and free trade benefit the poor in third world countries and in the USA. Boycotts are the province of economically ignorant, virtue signaling progressives. Great harm would befall displaced third world workers trying to lift their families out of poverty. Low-income Americans likewise would be harmed by being forced to pay more for many products. Walmart and similar stores, which sell goods manufactured in developing countries, save the typical American family about $200 per month.

Economic liberty, combined with capitalism, has lifted billions of people out of poverty just in our lifetime. Extreme poverty has plunged from 45% in 1980 to under 10% today; during that same time, world GDP more than tripled. Workers in developing countries are on the first rung of the economic ladder to success. They need economic liberty without government interference to continue climbing the ladder.

It wasn’t that long ago when America was a developing country utilizing child labor, particularly in mining and agriculture. By the way, my uncle, who worked in the coal mines beginning at age 6, later became an electrical engineer and lived to be 101.

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Next – Shocking links between the Borg (from Star Trek) and progressives

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Travels with George: 1968 to 1972 (Part II)

George Noga

Playing golf in Portugal was much cheaper and easier than in New York.

Travels with George: 1968 to 1972 (Part II)

By: George Noga – July 31, 2022

During these dog days of summer, I am taking a break from defending liberty and skewering government. I worked at a major airline in New York City from 1968 to 1972 and had a pass good for free first-class travel on any airline anywhere in the world. This is the second part of my misadventures; if you missed the first part last week (Israel, Athens, Marrakesh, Hong Kong, Macau, Djakarta), it is on our website.

East Africa: I went on a photo safari in Kenya, Uganda and Tanzania. Seeing my first lion in the wild was exciting; seeing the 100th lion, less so. Unfortunately, my visit coincided with Idi Amin expelling the Indians from Uganda. I planned to go from Nairobi to Bombay, but the airport was jammed with thousands of Indians trying to get on flights to India; more thousands were camped around the airport. Just getting inside the airport was daunting. I was lucky it took me only two days to get on a flight.

India: My bad luck continued; I arrived in Bombay just as war broke out between India and Pakistan. The Pakistanis were bombing Bombay and there was a blackout in effect the entire time I was in India. I had a pre-dawn flight from Bombay to Bangkok and my taxi ride from the hotel to the airport (a considerable distance) in total darkness was harrowing, as no vehicles could use headlights nor was there any street lighting.

Portugal: Beside me, there were a few other unmarried TWA management personnel who liked to play golf, which was next to impossible living in Manhattan. It actually was easier and cheaper to golf in Portugal. Periodically, we flew (first class) Friday after work, arriving in Lisbon early Saturday. We checked into the 5-star Hotel Palacio in Estoril just outside Lisbon. We then played 36 holes with caddies at a nearby championship golf course. We napped briefly before dinner at the best restaurant in Portugal, followed by a succession of fado bars. We played another 18 holes Sunday before our afternoon flight to JFK. The total cost for everything – $60 per person!

Note: A few words are in order concerning prices: The USA was on the gold standard until 1971 and Europe was still recovering from WWII. Consequently, the dollar was absurdly strong; in many places the local currency seemed like monopoly money.

Hungary: I took my parents to Hungary as my mother was of Hungarian descent and spoke fluent Hungarian. This was my first time behind the iron curtain and crossing from Austria into Hungary was unforgettable. Our train was descended upon by a phalanx of armed police before crossing no-man’s land of dogs, razor wire, minefields and towers with searchlights. Welcome to the people’s paradise of Hungary.

Even after converting our dollars into forints at the official exchange rate, everything was ridiculously cheap. One night we had dinner for six (we invited a family we had met on the train) at a fine restaurant with ample Hungarian wine; the tab was $20. We stayed at a guest house in Budapest; the cost for all three of us including lodging and breakfast was $1.20. We traveled to the village where my grandmother was born and met relatives who never knew we existed. It was draining emotionally for everyone.

Austria: Just as with golf in Portugal, it was cheaper and better to ski the Alps. Over the Christmas – New Year’s holidays we would ski in Lech, Austria, one of this world’s top resorts. We stayed in a 5-star hotel that cost $16 per person per night including lodging, three meals and afternoon tea with live music. I skied Lech 6 times; one memorable trip there was with my wife in 1976. We spent an entire month in Europe during which we skied for three weeks in Lech. We stayed at a nice hotel (including breakfast) with a balcony overlooking the slopes, skied every day but one, and ate dinner at the finest restaurants. The total cost for the month including air was $2,000. Note: I took my family of four to Lech in 1999; the cost was well over $1,000 per day.

Switzerland: During all my travels I never missed a day of work. Once I flew from Australia arriving at JFK at 7:00 Monday morning. I changed at the airport and arrived at work on time. The only time I missed work was on a late flight from Switzerland (I was skiing in Zermatt) that got cancelled for mechanical reasons and there were no other flights to the US. It was on the flight the next day that I met my future wife.

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Ruminations: I visited over 30 countries while still in my 20s. I visited most of them again 40 to 50 years later after I had retired. A half century ago each country was distinctive; today, they all blend together. It was interesting to observe the incredible changes that took place throughout the world during the 50 years between my visits.

Although not well-off by any stretch, I was able to travel the world in high style at a young age. Thanks to my airline pass, huge airline discounts at hotels and an incredibly strong dollar, I was privileged to sample the very best this planet of ours has to offer.

WE ARE TAKING A SUMMER BREAK. THE NEXT SCHEUDLED POST IS SEPTEMBER 4; HOWEVER, WATCH FOR POSIBLE UNPLANNED POSTS.

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Next on September 4th: Labor Day and MLLG preview for remainder of 2022

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Travels with George: 1968 to 1972

George Noga

I was privileged to travel the world at a young age and when the dollar was king.

Travels with George: 1968 to 1972

By: George Noga – July 24, 2022

As suggested by some long-time readers, I am lightening up with personal anecdotes during the dog days of summer. Everyone my age has some gripping experiences and I certainly have my share. The headline above is a knockoff of Travels with Charley, about Steinbeck’s travels across America in the 1960s – a good read. Enjoy!

Upon completion of my MBA and military duty, I was hired by Trans World Airlines in 1968 as a financial analyst at its headquarters in midtown Manhattan; I remained at TWA until 1972. As management, I had a pass enabling me to fly anywhere on TWA. In 1969 I was promoted to middle management and received a pass permitting me to fly free first class on any airline anywhere in the world. Following are highlights.

Israel: I walked alone throughout the old city of Jerusalem, along the Via Dolorosa and to the Wailing Wall – all in territory recently liberated by Israel and long before tourists arrived; it was too dangerous. I then went to Bethlehem where I was the only non-Muslim in the town and the only person in Manger Square. I visited a kibbutz and went, along with a heavily armed patrol, to a nearby swimming hole. Everyone took turns swimming while the others stood guard with automatic weapons at the ready.

I rode the Marrakesh Express – literally and figuratively.

Athens: I arrived discombobulated after a long flight and awoke well before dawn. I took a cab to the Acropolis just as the sun crept over the horizon. I had the Acropolis entirely to myself for an hour; I was free to roam anywhere. The last time I was at the Acropolis, there were at least 5,000 tourists and much of it was closed off to visitors.

Marrakesh: After flying into Casablanca, I rode the Marrakesh Express to Marrakesh, both literally and figuratively – if you follow my drift. I stayed in the ultra-luxe La Mamounia Hotel, where Winston Churchill was a habitue. I paid $16 per night; today it would cost $1,000. My father was stationed in Marrakesh during WWII and his letters from there (which we still have) are very descriptive, adding cogency to my visit.

Hong Kong: I arrived in Hong Kong just as Chinese New Year was in full swing. The scene was pulsating, like nothing I had seen or even imagined. I intrepidly ventured into the street and mingled with the frenetic crowd as it paraded through the streets.

My bathroom consisted of a hole in the ground and a shovel.

Macau: I took the hydrofoil to Macau to test my luck; there were only two casinos back then. As I was boarding the last hydrofoil back to Hong Kong, a Chinese gentleman recognized me from the casino and, using sign language, beckoned me to follow. He led me to the penthouse suite where there was to be a private blackjack game with 10 people, not one of whom spoke English. I panicked when my turn came to deal because I knew if I lost the first few hands, I would be out of money. Fortunately, they were bad players, and I thankfully won the first several hands.

Djakarta: I was enroute to Singapore from Australia and foolishly stopped in Djakarta without hotel reservations. There was but one first-world hotel back then and it was full – people were even sleeping in hallways. I ended up at a hotel where the bathroom consisted of a hole in the ground and a shovel. It required several fingers of duty-free scotch to get to sleep. I awoke with lice and cajoled my way into the Intercontinental Hotel swimming pool where the chlorine was strong enough to kill the lice.

To cap it off, I was detained at the airport when leaving Indonesia and questioned in an intimidating soundproof room. The gendarmes thought I was a foreign intelligence agent and couldn’t understand why anyone my age would visit Djakarta without family or business. At length, I was able to convince them I was an airline employee. I barely made my thrice weekly flight to Singapore, which was heaven compared to Djakarta.

Next week, Travels with George continues with more misadventures in Africa (Uganda, Tanzania and Kenya), Austria, Switzerland, Portugal, Hungary and India.

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Soaking the Rich and Big Corporations

George Noga

As blue states hemorrhage tax base, they raise taxes and cut services.

Soaking the Rich and Big Corporations

By: George Noga – July 17, 2022

I begin with new IRS data that show the fiscal effects of the ongoing blue state to red state migration. This is followed by the paradox of the massive Trump tax cuts that actually produced (just as we predicted) a veritable gusher of new tax revenue.

Starting next week, I lighten up my posts for the remainder of July with blogs of a personal nature. Some long-time readers have suggested I try this; please stay tuned.

Tax Base Migration from Blue to Red States is Accelerating

The massive human and financial migration from blue to red states is surging, fueled in part by working from home. Just released IRS adjusted gross income (AGI) for 2020 shows NY lost $20B, CA $18B and IL $9B; other big losers were MA, NJ, and MD, all deep blue. The big winners were FL $24B, TX $6B, AZ $5B, SC $4B, NC $4B, NV $3B and TN $3B. Other winners were CO, ID, UT, WY and MT – mostly deep red.

Blue states are trapped in a vicious circle; they lose tax base, then to make up the lost revenue they raise taxes, cut services and neglect infrastructure. They lose even more tax base, and the cycle repeats. When will they learn?

The annual loss of tax revenue is $1.6B for NY, $1.4B for CA and $700M for IL. The loss of AGI has a compounding effect, as the lost income from the current year is added to prior losses. For red states, AGI gains also are compounded. As blue states hemorrhage tax base, liberals respond by raising taxes, cutting services and neglecting infrastructure, which causes even more people to flee, which further erodes the tax base and culminates in a vicious circle. Meanwhile, red states are in virtuous circle and use the tax revenue gained from blue states to further cut taxes, improve services and rebuild infrastructure. Will the last person leaving New York please turn off the lights?

Trump Tax Cuts are Soaking the Rich and Large Corporations

I have blogged repeatedly that the only way to soak the rich is by cutting – that’s right cutting – taxes. The 2003 Bush tax cuts resulted in the biggest tax increase on the rich in US history as their share of taxes doubled. The same thing is happening with the 2017 Trump tax cuts. Moreover, it also is occurring with respect to corporate taxes.

Hauser’s Law: Tax revenue is a constant share (around 18%) of GDP whether the tax rate is 90% or 28% – for reasons explained below.

Individual income tax revenue is up 68% while corporate tax revenue is up 21%. Overall revenue is up an astounding 39%. Just as we predicted, lower rates resulted in more revenue; yet, progressives want to jack up rates for class warfare purposes. Progressives really don’t want to soak the rich; they want only to appear to be soaking the rich. If they really wanted to soak the rich, they would cut taxes.

Lower tax rates work due to Hauser’s Law, i.e. when tax rates are low, the rich are disincentivized to take measures to reduce their taxes. When rates are high, the wealthy work, save and invest less; they barter, retire earlier, hide, defer and underreport income, convert income to capital gains and defer gains without offsetting losses.

With high rates, high-income taxpayers use tax shelters; seek tax-free income; change the amount, location and composition of taxable income; exploit ambiguities and loopholes; shift income to corporations and/or to lower-bracket family members. They lobby aggressively for tax breaks, move to low tax venues, transition into the occult economy, employ top tax lawyers and accountants and much, much more.

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Next week we lighten things up with: Travels with George 1968 to 1972.

More Liberty Less Government – mllg@cfl.rr.com – www.mllg.us
MLLG

Annus Horribilis at the Midway Mark

George Noga

The gates are down and the lights are flashing but there is no train coming.

Annus Horribilis at the Midway Mark

By: George Noga – July 10, 2022

I published a special posting on January 1, 2022, (read it at www.mllg.us) warning that this year would bring unprecedented geopolitical, economic, political and financial horrors. Never before in 15 years and 600 posts did I make any such forecasts. Rarely in human affairs have predictions come true so quickly, accurately and completely.

Geopolitical Horrors

I predicted that if Putin intended to invade Ukraine, it would be in 2022; Putin invaded in February. I wrote Putin and Xi would form an entente; they issued a statement stating, “their friendship has no limits“. I said Iran would race toward a nuclear weapon and threaten its neighbors; they have enriched uranium to weapons grade and threaten Saudi Arabia. I predicted North Korea would act up; they have resumed test firing ICBMs, threatening Japan and even the USA, and testing nuclear weapons. I wrote if Xi intended to invade Taiwan, it would be this year. I now assess this as less likely due to the unexpectedly robust global opposition to Putin’s Ukraine invasion.

Economic Horrors

I forecasted inflation would exceed 10%. The Producer Price Index is up 11% and other indices are up 8.6%. The real rate of inflation is 15% if computed on the same basis as the last time the US had high inflation. I predicted the Fed would surge interest rates leading to a recession. The Fed is now increasing rates three-quarters of a point at a time just as I predicted. They are doing too little too late. The economy shrank by 1.5% in the first quarter. Throughout US history when this has occurred, there is a 94% chance of a recession. The United States likely is already mired in a recession.

Per Barack Obama “elections have consequences“. Indeed they do!

On the economic front, the worst is yet to come. I expect inflation to remain stubbornly high and intractable. The Fed will be forced to raise rates much more than they now contemplate. There will be a prolonged period of stagflation, i.e. inflation combined with stagnation. Ultimately, getting control over inflation will result in a severe recession. The recession, in turn, will lead to out-of-control spending and deficits in a futile attempt by Biden and the Democrats to salvage their tattered political prospects.

Political Horrors

In January I predicted a Biden horror show. The ineptitude of his Administration has exceeded my worst fears. They have hit rock bottom (and are still digging) on every issue: inflation, immigration, energy, supply chain, pandemic, crime and foreign affairs. Identity politics has resulted in widespread incompetence. The following were selected based solely on identity: Harris, Austin, Yellen, Buttigieg, Raimondo, Becerra, Granholm, Cardona, Mayorkas and a slew of lesser lights. Sadly, the gates are down; the lights are flashing; the whistle is blowing, but there is no train coming.

Financial and Investment Horrors

I wrote that in December 2021 I moved my investments into a highly defensive posture with over 70% in cash, cash equivalents and ultra-short duration bonds. I also doubled my holdings of gold, commodities and TIPs. Thus far, the NASDAQ is down over 30% and the S&P 500 over 20%. Commodities are up 30%, but gold is up only slightly due to the strength of the dollar and higher interest rates. The markets are not likely to hit bottom until 2023 or even 2024, but the worst is yet to come. In the immortal words of Barack Hussein Obama “elections have consequences“. Indeed they do!

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Next on July 10th: Soaking the rich and fat cat corporations.
More Liberty Less Government – mllg@cfl.rr.com – www.mllg.us