Economist and TV personality Larry Kudlow explained that the decision on Wednesday by many of the world’s central banks made it easier for European banks to borrow dollars from the Federal Reserve. He made it clear that “nothing has been solved in Europe. The Europeans are not yet helping themselves. Why should the ECB (the European Central Bank) write a trillion-dollar check to near-bankrupt governments?” The real problem isn’t liquidity. There’s plenty of money sloshing around in the banks of the world. The instant problem is the type of money. The banks want to hold dollars, not euros, and the costs of holding dollars was rising to levels not seen since the collapse of Lehman Brothers in 2008. And the reason dollars were getting increasingly expensive? One main reason was that American money market funds were pulling their dollars out of European banks: Between May and October those funds reduced their holdings in European banks by 42 percent, while their holdings in French banks were cut by two-thirds. When demands were made on those banks for dollars, the banks had to sell euros to get them. As Capital Economics explained:
As the economic crisis in the European Union grows day by day, there is a proportionate degree of speculation around the world about the final extent of the damage that will be done by the looming collapse of the euro. According to Daniel Mitchell, a contributor to Forbes.com, many individuals among the wealthy elite in Europe are already planning to flee their respective countries for safe havens in nations such as Costa Rica or Australia. Meanwhile, the British Foreign Office is making plans to evacuate Britons from the Continent in the event of widespread rioting.
Here’s a story that’ll tickle your McRibs. On December 1 a law seemingly banning McDonald’s Happy Meals went into effect in San Francisco. The “Healthy Meal Incentives Ordinance” prohibits restaurants from giving away toys with meals that do not meet with the city’s approval — namely, meals with too many calories, too much salt or fat, or insufficient fruits and vegetables. Just a few days before the ordinance took effect, SF Weekly reports, McDonald’s announced it had found a simple way around the statute: Charge customers extra for the toys. Now in order to obtain a Happy Meal toy, parents will first have to buy the meal and then pay an additional 10 cents, which will be considered a donation to Ronald McDonald House charities. With Burger King’s announcement that it will implement a similar policy, the Happy Meal ban has thus effectively been neutralized. However, for the nanny-state types who thought they were protecting children from dangerous fast food, there is even worse news. Prior to December 1, McDonald’s stores in San Francisco actually allowed patrons to purchase a Happy Meal toy by itself for $2.18 rather than having to buy the meal to obtain the toy. Now that the Golden Arches are going to charge extra for the toys, they are discontinuing the toy-only policy. Henceforth, any parent wishing to purchase a Happy Meal toy for a child will be forced to buy the meal, too. This, the Independent Institute’s Anthony Gregory points out, is “another unintended consequence of a bad law, since now, on the margin, customers will sometimes opt to buy the greasy food targeted by the law just so they can get the toy, when before they would have not bought the food.”
As central banks around the world unleashed a coordinated deluge of new money to deal with the economic crisis swamping Europe, critics expressed outrage that the Federal Reserve System — and all holders of U.S. dollars by extension — would be bailing out profligate European governments and the troubled euro currency. And furious American lawmakers are again demanding congressional oversight of the Fed and a restoration of sound money. On November 30, the Fed announced in a press release that it was cutting the cost of temporary dollar liquidity swaps almost in half. The rate was slashed from about one percent to slightly over 0.5 percent, making it much cheaper for foreign central banks and the financial institutions they fund to borrow a practically unlimited supply of newly created U.S. dollars. The news was met with outrage by Congressman Ron Paul, whose subcommittee deals with monetary policy and the central bank. Paul is once again calling for, among other measures, an audit of the Fed and the eventual restoration of honest money. “The Fed's latest actions in cooperating with foreign central banks to undertake liquidity swaps of dollars for foreign currencies is another reason why Congress needs enhanced power to oversee and audit the Fed,” said Rep. Ron Paul (R-Texas), the Chairman of the House Domestic Monetary Policy and Technology Subcommittee. “Under current law Congress cannot examine these types of agreements.”
Regions Hospital in St. Paul, Minnesota, has announced that it will cease performing abortions in December, becoming the first abortion clinic to close in the state in two decades. The Minneapolis Star-Tribune reported that “Regions is the last remaining hospital in the Twin Cities area that performs elective abortions…. Last year it performed 545 abortions, down from 902 a decade earlier.” With the declining numbers of abortions in Minnesota, the hospital, which is part of HealthPartners, decided to terminate its GYN Special Services Clinic, which ranked just sixth in overall abortions in the state. According to state Health Department numbers, each of the five more profitable clinics were responsible for at least 1,000 of the procedures in 2010. Overall, there has actually been a hopeful decline in abortions in the state over the past few years, with 11,505 abortions reported in the state last year, compared to 14,450 in 2000. Nationally, according to the pro-abortion Guttmacher Institute, there has also been a steady decline in the number of abortion clinics nationally, from a high of 2,900 in 1982 to around 1,800 by 2005, a number that remained consistent through 2008. Most recently, as several states have enacted legislation to restrict abortion, pro-life leaders expect the numbers to dip even more.
A recent Pew Research Center study proved that there was in fact truth to assertions made by Ron Paul’s supporters that he was being “blacked out” by the media. That study compiled a list of 52 mainstream news sources and discovered that Paul received significantly less media coverage than all of the other candidates, including Tim Pawlenty, who dropped out of the race because of his campaign’s lack of progress. That blackout continues it seems, as the Republican Jewish Coalition’s GOP 2012 panel, set to take place on December 7, will not include Ron Paul. “As Mike Allen previewed in Playbook, the event will allow the seven candidates taking part — Ron Paul is not attending — 35 minutes each to speak,” writes Maggie Haberman for Politico. Currently, it’s unknown whether Paul was not invited or declined the invitation, but Adam Kredo of Washington Jewish Week said of Paul’s absence, “Note that Texas Rep. Ron Paul, no good friend of Israel, will not be in the house.” That statement appeared on the Republican Jewish Coalition’s website. Kredo’s assertion that Paul is “no good friend of Israel” is based on Paul’s philosophy that the United States should be less involved in Israel’s affairs.
A group of anti-world government hacker activists or “hacktivists” under the banner of “TeamPoison” hacked the United Nations Development Program (UNDP), releasing hundreds of passwords belonging to the organization’s bureaucrats. The release also included a message blasting the global body and its affiliates for corruption, fraud, and atrocities, along with a warning of more attacks to come. UN officials tried to downplay the breach, saying all of the information was several years old. But TeamPoison and security experts said that was not the case — much of the data is current, and compromising the UN’s cyber security was a serious job. In a statement posted online along with the stolen usernames and passwords, the hacker team criticized the global organization on several fronts. “A Senate for Global Corruption, the United Nations sits to facilitate the introduction of a New World Order and a One World Government,” the group said. Also included was a statement attributed to psychiatrist Brock Chisholm, the first director of the UN World Health Organization. “To achieve a One World Government, it is necessary to remove from the minds of men their individualism, their loyalty to family traditions and national identification,” Chisholm was quoted as saying.
Facebook is in trouble once again over possible privacy breaches. According to government officials, Facebook has misled over 800 million users regarding the safety of their personal information. The FTC released a 19-page complaint against Facebook addressing how the company has been approaching its users’ rights and privacy. The complaint focused on the changes to privacy control that Facebook made in 2009, which resulted in the automatic sharing of personal information and pictures of Facebook users, even if those users had previously set their profiles to private settings. Likewise, Facebook was charged with purposely sharing user information. Fox News reports, "The unflattering portrait of Facebook’s privacy practices emerged Tuesday in a Federal Trade Commission complaint alleging that Facebook exposed details about users’ lives without getting legally required consent. In some cases, the FTC charged, Facebook allowed potentially sensitive details to be passed along to advertisers and software developers prowling for customers." Because this is not the first time Facebook has been scrutinized for issues of privacy, the company has now agreed to government audits of their privacy practices every other year for the next 20 years. Additionally, any privacy violation on Facebook will result in a fine of $16,000 each day for each violation. While the FTC commissioners have all approved of the agreement struck with Facebook, the FTC is open to public comments through December 30 before ultimately finalizing the agreement.
Cato Institute senior fellow Jim Powell wrote in Forbes magazine about the inevitable and predictable decline of rich nations that debauched their currencies in order to pay their bills. Powell said that politicians’ urge to promise and then to spend is almost overwhelming, calling it “a visceral urge to spend money they don’t have. They can’t control themselves. They’ll weasel their way around any efforts to put the lid on the cookie jar.” The Roman Empire was on a gold standard, minting and using the aureus from the 3rd century B.C. until the 4th century A.D. The aureus initially contained 10.9 grams of gold, which was worth about 25 denarii, or about a month’s wages. As the empire devolved into promising more and more services (grain subsidies, public entertainment, and a huge bureaucracy and military establishment) it soon exceeded revenues generated through taxation. To make up for the difference, the aureus was steadily debased so that by 50 B.C. it contained 9.09 grams of gold, 8.18 grams by 46 B.C., 7.27 grams by 60 A.D., 6.55 grams by 214 A.D., 5.45 grams by the year 292, 4.54 grams in 312, and 3.29 grams by 367. Paper money was more easily debased, as the Chinese discovered. Powell noted that seven different Chinese dynasties issued paper money to pay their bills and all of them eventually collapsed or were defeated by others that issued their own paper currency.
Former Utah Governor Jon Huntsman has just barely been able to have his voice heard in the Republican Party’s presidential primary race, so low are his polling numbers. Yet, still, he is a candidate that, not unlike every other such candidate, proudly proclaims his commitment to liberty and, hence, “limited government.” But is Huntsman really who he claims to be? This is the question with which we must concern ourselves. As we will see, just a brief look at Huntsman’s utterances and deeds discloses in no time that, in his case, appearance is eons apart from reality. To Huntsman’s credit, as Governor of Utah he presided over tax cuts — sales taxes especially — and a simplification of the overall tax code. For this, the Cato Institute lavished praise upon him. Yet lest we hastily exploit this fact as proof of his commitment to smaller government, we would be well served to note that the very same libertarian-friendly think tank criticized Huntsman for having “completely dropped the ball on spending, with per capita spending increasing at about 10 percent annually during his tenure.”