Saturday, July 19, 2008

The Economic Show Trials Begin

The inverted pyramid of corporate socialism: The wealthiest are subsidized, through inflation, by those who can least afford it.

Could it be that our ruling elite has effectively transcended hypocrisy? As the aphorism informs us, hypocrisy is the tribute that vice pays to virtue; it is the product of a person's capacity for decent shame, the fig-leaf garment concealing one's naked corruption.

Shame being a vital precursor to hypocrisy, those who rule us -- not only the politicians, but the banksters and image-molders as well -- can't be accused of hypocrisy. This would be a bit like criticizing the fashion sense of somebody who's color-blind. This doesn't mean, however, that they should be allowed an indulgence for the evil that they do.

Last week, during a brief digression in the ongoing efforts to socialize the losses suffered by the super-rich kleptocrats at Fannie Mae and Freddie Mac, Congress conducted an authentic Orwellian hate-fest directed at "super-rich" people who had earned their money through legitimate enterprise.

The Fannie/Freddie nomenklatura built huge profits through the government-subsidized generation and "securitization" of bad mortgages and criminally corrupt bookkeeping. Last week's hearings by the Senate Subcommittee on Investigations focused on people who had made large sums of money through honest, productive commercial activity -- and then tried to preserve their honest earnings for their posterity by protecting it in bank accounts in Liechtenstein.

Congress and the ruling elite it serves are eagerly stealing everything in sight, through taxes, subsidies, and inflation. But as last week's Senate hearings-cum-show trial illustrate, they are tuning up the machinery of mass hatred in anticipation of scapegoating authentic capitalists for the ongoing economic collapse.

The fault, we will be told, lies not with our corrupt and incurably profligate government, or the incorrigible official counterfeiters at the Federal Reserve, or the government-subsidized corporatist interests who are their clients -- but rather those who greedily insist on keeping what they earn instead of paying their "fair share" in the name of the "common good."

The calculation here is that a hate campaign of that sort can keep the public from noticing how the phrase "common good" always seems to refer to policies that confer benefits on one particular elite. And it's quite likely that members of that elite have their own numbered accounts in places like Switzerland and Liechtenstein. Which is probably another reason they're so eager to go after well-heeled people who aren't part of their club.

As I have noted before, Liechtenstein, unlike the United States, is a relatively free country. It is presided over with a gentle hand by Prince Hans-Adam II, rather than being ruled by a degenerate fascist oligarchy like the one entrenched in Washington. Hans-Adam II is on record saying that a top tax rate higher than 6% is "tyrannical." This puts him well ahead of any other political leader I can think of in pursuing the truth, which is that taxation is always and everywhere nothing but officially sanctioned theft.

As would be the case in any civilized country, Liechtenstein's banking secrecy laws were designed to protect the assets of depositors from the scrutiny of predators serving the ruling class. Many foreign depositors have, in accordance with the sound and commendable laws of that estimable alpine country, set up foundations to protect their earnings from rapacious tax-gatherers in their own afflicted nations.

Weasel at large: Heinrich Kieber, convicted of fraud in Liechtenstein, esteemed informant for the tax gestapo of various governments. He is what I call an "SOS" -- someone who should be Slapped On Sight (I only use a closed fist on a real man).

Unfortunately, a squalid little creature named Heinrich Kieber who had been a clerk at Liechtenstein's LGT Group, pilfered several CDs worth of data regarding foreign depositors from the United States and Europe. Driven by a variant of the invidious impulses that sixty years ago would have led him to rat out those who protected Jews from the Gestapo, Kieber -- as viscous as he is vicious -- oozed into the offices of Germany's BND intelligence service and sold his stolen information for $7.3 million stolen at gunpoint from German taxpayers.

Kieber conducted similar transactions with ruling criminals in London, Paris, Rome, and Washington. His information This led to last week's hearings, chaired by the loathsome Senator Carl Levin (D-Michigan), who -- in the interests of "bipartisanship" -- gave a prominent co-starring role to the even more repulsive Senator Norm Coleman (R-Minnesota). Kieber himself, who has been taken into the "witness protection program," testified by way of a videotaped statement from a secret location.

The target of Comrade Levin's show trial was the reported $1.5 trillion cached by wealthy Americans in offshore accounts, including those in Liechtenstein, Switzerland's UBS, and elsewhere. Those banks, Levin complained, had employed "tricks" that made it "impossible for the Internal Revenue Service to follow the money, bring tax cheats to justice, and bring back into the US treasury the tens of billions of dollars owed to Uncle Sam."

Well, sure: The banks that sought to protect the assets of Jews during WWII employed the same methods to protect the assets of honorable people from the contemporary tax gestapo, who are the true moral heirs of the Nazi officials who sought to seize the assets of persecuted Jews. Impeding the efforts of criminals to steal wealth is not a "crime," and it's interesting that Levin didn't use that word to describe the "tricks" he protested.

And, if I can be permitted a brief digression, Levin's statement that the money should be brought "back to the US treasury" in order to pay "the tens of billions of dollars owed to Uncle Sam" is a Marxist lie sandwiched between two crusty slices of chutzpah.

For the purposes of this discussion, we'll refer to the fraudulent fiat currency issued by the Fed as "money."

Any quantity of "money" honestly earned
does not belong to the Treasury; it belongs to the individual or enterprise that earned it, until he or they decide to spend it for some purpose. Accordingly, that money cannot go "back" to the Treasury, although it can be diverted there to be wasted on corrupt government undertakings of various kinds.

Furthermore, taxes are not "owed" to the federal government; they are seized by the federal government. One "owes" money to another party from whom he has received goods or services pursuant to a legitimate contract. "Contracts" imposed through duress (such as extortion pay-offs) are illegitimate. Those of us who pay taxes do so not because a legitimate contract exists between us and the Regime that extracts our wealth; we do so because of a desire to stay out of prison, or to avoid violent death at the hands of the State's hired killers.

Levin is a nearly ideal representative of the parasite class. His mind, or what passes for it, is entirely hostage to collectivist assumptions. Just as a dog cannot discern colors, Levin can't see anything amiss in extending official protection to a foreign criminal (Kieber was convicted of fraud in Liechtenstein) so he can testify against those who have done no injury to persons or property, or in treating foreign bank officers as if they were under Washington's jurisdiction by demanding that they testify before his committee.

All of this is being done, Levin insists, to bring "tax cheats to justice." Leaving aside, for the nonce, the fact that the word "justice" when uttered by the likes of Levin is like the word "love" in the mouth of a whore, the cruel fact is that tax avoidance is impossible for anyone who conducts business using the Federal Reserve's fraudulent scrip.

This brings us to one history-making admission offered last week by Fed Commissar Ben Bernanke beneath the avuncular but relentless cross-examination of Rep. Ron Paul (R-Texas) during Bernanke's recent congressional testimony.

Actually, this illustration is deceptive regarding the innate value of the Federal Reserve Note: The paper grade used in creating that bogus currency is ill-suited to such use.

“Inflation is a tax," Rep. Paul observed during his colloquy with Bernanke. "And if the Federal Reserve, and you as chairman, have this authority to increase the money supply arbitrarily, you’re probably the biggest taxer in the country."

"I couldn't agree with you more that inflation is a tax," admitted Bernanke, quickly seeking to evade responsibility by saying that "inflation currently is too high." The criminal syndicate over which Bernanke presides imposes taxation without representation or accountability.

Furthermore, it
exports that inflation world-wide, thanks to the fact that the instrument of debt the Fed calls the "dollar" is the world's reserve currency. This means that nearly everyone who uses the dollar to conduct business is paying the tax called inflation. This is a unique form of withholding, in that the Fed steals an increment of value from each dollar before it ends up in the hands or accounts of private actors in the economy.

Pity poor Emmett Neverend: Once a rational and respected academic, he lost his wits when he finally came to understand the moral implications of the Regime's financial system.

Where a government exercises the power to tax through inflation, no other taxes are "necessary," including the income tax. Furthermore, where governments tax through inflation, no tax evasion is possible, as long as people conduct business in that adulterated currency.

The redoubtable G. Edward Griffin points out that former Fed Chairman Beardsley Ruml admitted that, because of the Fed's ability to tax via inflation, "Taxes for Revenue are Obsolete" -- the title of an essay Ruml published in the January 1946 issue of American Affairs. As Ruml wrote,"given control of a central banking system and an incontrovertible currency [that is, a fiat currency not backed by gold], a sovereign national government is finally free of money worries and need no longer levy taxes for the purpose of providing itself with revenue. All taxation, therefore, should be regarded from the point of view of social and economic consequences."(Emphasis added.)

Thus, where Washington is concerned, taxation exists purely for the purpose of social manipulation through vulgar redistribution of wealth, not to pay the operating costs of government. And as carried out by the IRS, taxation is an instrument of intimidation and terror used to compel social conformity.

By keeping their money in dollars, or any currency "pegged" to the dollar, so-called "tax cheats" aren't evading taxes. They, like the rest of us, are being taxed through the Fed's relentless inflation. Their only hope to evade being taxed by the Fed would be to take the advice offered by Jim Rogers last fall: Get out of dollar-denominated assets entirely.

There are only two ways to acquire wealth: It can be earned through mutually beneficial voluntary action, or it can be stolen through force and fraud. Any effort to acquire wealth that involves any degree of force or fraud is theft.

Senator Levin and his comrades, who are preparing to bail out the politically favored thieves running Fannie and Freddie, spent many taxpayer-funded hours last week dilating upon the supposed iniquity of those "super-rich" Americans who seek to protect what they earn from people whose professional lives are nothing but one prolonged exercise in theft.

It would avail nothing to point out such hypocrisy to Levin and his ilk; they can no more feel honest shame than a chimpanzee can compose a cantata.

On sale now!

Dum spiro, pugno!


Anonymous said...

"Render unto Caesar that which is
Caesar's." -Jesus Christ

This was not a command to pay
taxes to the government, it was a
command to honor private property.

The fiat Dollar DOES belong to the
FED, and it follows that they can
call the shots as they wish.

It is the job of Congress to
(by breaking legs if necessary.)

The Constitution provides for
Gold and silver coins.

"The gold and silver are mine
saith the Lord." -Jehova

Now who's in charge?

Anonymous said...

It needs to be emphasized that the U.S. is an outlier in the world, in taxing its citizens on their worldwide income. In most countries, citizens who deposit or invest outside their own borders are not taxed by their home country -- only by the foreign country. But the U.S. lays claim to its citizens' worldwide income.

This has had profound consequences; leading this year to the complete destruction of Swiss banking secrecy. Now the U.S. seeks to impose on worldwide banks a rule that they either withhold 30% of interest belonging to Americans and send it to Washington, or else directly report the earnings to the IRS on a Form 1099. As a result, many tax havens accept deposits from any nationality but Americans. Usgov has turned U.S. citizens into shunned "ugly Americans" when it comes to overseas banking services.

The natural result is that beleagered U.S. citizens will seek other shelters. Precious metals are one; the last bearer asset. Unfortunately, they offer no yield. Another is overseas property investment, such as rental real estate. So far, the IRS is not wired to capture Americans' overseas rental income, though it doubtless is working on the problem. Europe, as U.S.-occupied territory, will succumb first to the demands of the US taxman.

Ironically, the less-computerized Third World probably will prove to be the last bastion of financial freedom for those seeking to flee the intolerable cost of the White Man's Burden of imperialism and empire. (Or if Obama is elected, the Black's Man's Burden of empire.)

If the Beast cannot be defeated militarily, the next best option is to starve it financially. Think outside the box and prosper, or at least survive ...

Anonymous said...


You wrote:

"Precious metals are one; the last bearer asset. Unfortunately, they offer no yield."

I beg to differ.
I have been buying and selling
American gold Eagles and American
sliver Libertys for the last 6
years and have tripled my money.
That's a better return than any
other investment I could have made.

The DOW is linked to the fiat
Dollar, gold and silver are not.

"The gold and silver are mine,
saith the Lord," -Jehova

Who better to trust with your money?

God doesn't charge interest,
He PAYS interst.

Anonymous said...


"Slapped On Sight"...that's funny!!

"I'm sendin out an SOS! I'm sendin out an SOS!"
--The Police


Anonymous said...

The posted link to the video appears to be deprecated. This looks the the one that fits:

I hope Americans don't think like the commenter to this video -- who doesn't seem to understand the role of speculators, or what is different about index speculators.

Another great article, Mr. Grigg.

Anonymous said...

To will blalock,

will is right. you have not made any money on your gold or silver. you merely converted worthless dollars into something of value and have preserved that purchasing power. the current price of gold and silver is only a reflection of the loss in purchasing power of the dollar.

the same goes for oil. the price of oil looks as if it's climbing, but it's not. compare it to the value of gold and silver at any time and you will see that one ounce of silver continues to buy you about 4.0 to 4.5 gallons of gas, even if you go back 60 years.

as public enemy used to say...

"don't! don't believe..don't believe the hype!!"


Anonymous said...


You're right about that, in large
part. The metal has kept up with
inflation but at the same time it
is still appreciating(and depreicating)
with the precious metal market.

Even so, I don't know of any other
instrument that I can access as a
non-insider trader that will
protect my investment, with yield,
at that level of security.
None I can think of.

Gold is simple and available to
any investor large or small.
We are not entirely out in the
cold. God provides a way to protect
our savings. DOW provides a way
for it to be stolen.

Anonymous said...

This is an excellent blog spot!

To bad only the minority read it.

Anonymous said...

will blalock,

correction to my last post. will did not make that comment, it was "anonymous @ 4:53"


Anonymous said...

that taxes only serve to enrich bankers and to intimidate the population is the most important point to drive home for people not familiar with the system under which we live. the government funds itself through printing, not taxation.

Anonymous said...

Will, how dare you attempt to reduce my respect for street smart gangsters by implying that modern day bankers act like gangsters. (Your use of the term "bankster")

What a hoot!

Anonymous said...

Perhaps taxation serves to boost confidence (or gives a much needed incentive) for a fiat currency. Without taxation people may be more likely to ditch a bad money for a good one, like something backed with actual value. In my view two things keep the fiat currency ruse alive; 1. Taxes payable in fiat currency (the above arguement) and 2. Legal tender laws. Without the first people might just ignore the second. Then you would be free of inflationary taxes.

States issuing fiat currencies always enact the first principle.

Anonymous said...

Nothing is Caesar's - he obtains everything at gladius/pilum point, so he is owed nothing. No taxes = no State.

Anonymous said...

If one could at least deduct income confiscated through inflation(lets say somewhere between ten to fifteen percent of annual earnings) from the "Amount Owed" on his or her income tax bill it might make government think twice about its reckless spending/counterfeiting. Washington has been getting away with having its cake and eating it too for far too long. Yes, I know that both the income tax and fiat money are entirely incompatible with a free society but it would be a step in the right direction. Dr. Paul, are you listening?

Anonymous said...

Thank you for this great article, Mr. Grigg.

I would really like to read some equally as clearly written articles on what role true capitalism played in the early days of our republic. What is really capitalism, not monopoly capitalism that we have had for so long that I don't know what the real thing is and if the real thing is a good thing and what our founders intended.

I also would like to read about the correct "general welfare" clause of the Costitution truly means. It too has been adulterated to the "common good" and redistribution of wealth idea.

I have read Batiat's The Law and know that production is real and only wealth and that a person must be allowed to keep and benefit from the fruits of his own labor.

Keep the enlightment flowing, Mr. Grigg.

Anonymous said...

"I have been buying and selling
American gold Eagles and American
sliver Libertys for the last 6
years and have tripled my money." -- will blalock

will, I'm glad that you have been successful in your trading. And it helps that this decade has featured a strong rise in metals (or more fundamentally, a headlong depreciation of the dollar).

However, my comment about yield pertained to holding an aaset. Coins held without trading do not produce current income, whereas rental real estate does. However, coins are a true bearer asset, whereas real estate is always registered.

I mentioned overseas real estate, especially in the Third World, because their land registries haven't been databased yet for the IRS's convenience. Whereas, almost the entire base of global bank deposits is now open to Uncle Sam's prying eyes.

Twenty or thirty years down the road, that could all change. But by then we may have the ultimate bearer asset, digital gold ... and even the ability to lend it for interest paid in gold. I know this has been tried already, but some problems occurred.

Anon 4:53 PM

Anonymous said...

"Perhaps taxation serves to boost confidence"
The only confidence gained
is certainty that your government
will destroy you if you don't
pony up the vig.

"Nothing is Caesar's"
Correct, nothing unless we cede it
to him...such as FED fiat dollars
and subsequent income tax vig

"If one could at least deduct
income confiscated through
Are you suggesting we reform the
income tax code to make it fair?
How do you make extortion "fair?"
Ron Paul wants to ABOLISH the IRS,
not reform it.

Anonymous said...

Jesus' said "Render unto Caesar THAT WHICH IS CAESAR'S" -- caps mine -- not render unto Caesar everything Caesar demands and then sit down and shut up.

Mark said...

Caesar owns nothing, and nor do you Will Blalock, it all belongs to God!

Anonymous said...


Every hair is numbered, and bought
with a price.

Unknown said...

You should apologize to whores everywhere for the ultra harsh comparison...also a whore has a better chance at redemption...

William N. Grigg said...

Adam, you're entirely correct. A whore -- in the conventional sense -- is only peddling him/herself. Levin trades in the flesh and freedom of others. So I herewith apologize to the practitioners of the World's Oldest Profession for comparing them, in any way, to the unspeakable Sen. Levin.

Anonymous said...

On an unrelated issue: the police started using a drug to subdue "unruly" victims.

The notable side effect of the drug is amnesia.

What's next? Declaring people protesting againt the regime mentally ill - Soviet-style?

Anonymous said...

Dear Dixie Dog

It's anon here, I've replied to your reply to me in the previous entry, Women and Chidren Last. Also, people might be interested to see Thomas Paine's entry below mine.

Talking of rendering, Caesar n all that - time for a truly extraordinary rendition..

Best wishes

James David Beebe, Jr. said...

If you know someone who needs an introduction to the way the monetary system works, google "money as debt".

JJ Honeycutt said...

Fellow Idahoan here. Thanks for the post. Still learning the basics of economics but I am coming along. I'll definately add you to my feed. Blesssing,

JJ Honeycutt

Anonymous said...

JJ - Greetings from another Idahoan admirer of Will's.

My self-education in economics started with and Give them a try. Be forewarned that it also led me to buy quite a number of books from authors like Murray Rothbard, Thomas DiLorenzo, Hans Hermann Hoppe, Robert Higgs, Paul Craig Roberts and others (sorry Will, yours is still on my soon to be purchased list). It is how I found my way to Will's blog . . .

Anonymous said...


Actually, I prefer Jesus' solution to paying tribute found in Matthew 17:24-27.

Peter was easily embarrassed by his sense of inferiority to the ruling class.

24 ¶ And when they were come to Capernaum, they that received tribute money came to Peter, and said, Doth not your master pay atribute? 25 He saith, Yes.

And when he was come into the house, Jesus prevented (spoke to him first) him, saying, What thinkest thou, Simon? of whom do the kings of the earth take custom or tribute? of their own children, or of strangers?

26 Peter saith unto him, Of strangers.

Jesus saith unto him, Then are the children free. 27 Notwithstanding, lest we should offend them, go thou to the sea, and cast an hook, and take up the fish that first cometh up; and when thou hast opened his mouth, thou shalt find a piece of money: that take, and give unto them for me and thee.

dixiedog said...

Very informative, Will. Peter Schiff seems to also be a man speaking a lot of truth about the economic picture we're facing; battling the government/media "mainstream" mavens on the economic/finance programs.

Just out of curiosity, Will, have you ever considered making YouTube video recordings on your own of the various subject matter you so poignantly write about, sort of in the vein of your audio recordings?

Yes, there are videos by others of some of your public presentations and whatnot, but your own recordings on your own channel would be great, IMO.

Anonymous said...

Dear Buffalo Girl

Thankyou for reminding me about Matt 17:24

So a future people's money system needs to be based on, linked to actual wealth, the earth itself? Not confidence, not gold which you cannot eat but the very ecology we rely on?

Is this possible what Jesus is suggesting?

Best wishes
Anon 111

Anonymous said...

Anonymous 111,

My take on that story is that if we are doing the Lord's work He will provide.

Being too poor to be able to pay tribute was an embarrassment to Peter.

The Lord knows his worth. He wasn't troubled by a petty bureaucrat's insinuation that Peter's Master had no coin with which to curry favor.

I think the Lord has a great sense of humor. He knew of Peter's embarrassment. I think He was less concerned about the bureaucrat's demands. He solved the problem by sending Peter to catch the fish that had swallowed a gold coin at some point in its life.

The Lord, having power over the elements was able to direct Peter aright. The problem was solved to everyone's satisfaction.

Jesus reveals a fundamental indifference to the way things are done 'in the world'. His focus is on His Father's work.

When these little annoyances arise in our lives, we can look to God to provide the means so long as our commitment and focus are on the Lord's work.

Of course, we do need to work and provide for our own needs and those of our families. Gold coins don't appear in fish every day. But, my experience has been that the unexpected financial challenge can be met in some unanticipated manner when I seek guidance from the Lord.

Anonymous said...

Thanks for yr interpretation. 111