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  • 1. Don’t Spend Money: Save It • Defending Gun Ownership • Cuba Under Fidel and Raul April 28, 2008 www.thenewamerican.com ThaT Freedom Shall NoT PeriSh $2.95 A Bad Investment
  • 2. Featured ProdUctS For the Love of Country Listen to history come alive with this five-CD series. A collection of Revolutionary War stories with over five hours of rich listening entertainment. Includes “Tales of American Heroism,” “The Fringe War,” “Patriots & Countrymen,” “Struggle for the South,” “The Revolutionary Women.” (2007, 303min, $39.95 per set, $9.95 per individual CD) CdSFLC The Real Face of the EU This documentary produced by Phillip Day includes commentary from a member of the European Union (EU) Parliament and other EU analysts. It covers the history and goals of the EU, as well as the disturbing, irrevocable implications the EU continental government holds for every British citizen. With a similar process unfolding in America under the North American Free Trade Agreement (NAFTA), Americans are starting to ask themselves if their elected officials should be allowed to go down the same path and create a North American Union. (2008, 36min) (DVD/sleeved: 1-3/$1.50 ea, 4-6/$1.25 ea, 7-9/$1.00 ea, 10-20/$.90 ea, 21-50/$.80 ea, 51+/$.75 ea) dvdRFeU (DVD/cased: 1-3/$4.00 ea, 4-6/$3.00 ea, 7-9/$2.50 ea, 10-20/$2.00 ea, 21-50/$1.75 ea, 50+/$1.50 ea) dvdRFeUC Duo DVD Mental Health, Education and Social Control Overview of america and a Case for In a follow-up volume to National Mental Blocking the North american union Health Program and Mental Health Screening, Overview of America dynamically illustrates what author Dennis L. Cuddy, Ph.D. explains makes America unique. A Case for Blocking how our government is using sweep- the North American Union offers an updat- ing legislation on mental health, joined ed, no-nonsense report on the dangers with education, as a means of social con- of the proposed North American Union. trol. (2007, 128pp, pb, $10.95) BKmHeSC (2007, 40min total; 1-3, $4.00 ea; 4-6, (Mental Health Screening, 2005, 112pp, pb, $7.95) BKmHS $3.00 ea; 7-9, $2.50 ea; 10-20, $2.00 ea; (National Mental Health Program, 2004, 41pp, pb, $3.95) BKnmHP 21-50, $1.75 ea; 51+, $1.50 ea) dvdBdUO Buy all three books for ONLY $18.95 BKSmH ✁ QuAnTITy TITlE PrICE ToTAl PrICE Name ______________________________________________________________ Address ____________________________________________________________ City _____________________________ State __________ Zip ________________ Phone ____________________________ E-mail ______________________________ ❑ Check ❑ ViSA ❑ Discover 000 0000 000 000 0000 0000 0000 0000 0000 ❑ Money Order ❑ MasterCard ❑ American Express VISA/MC/Discover Three Digit V-Code American Express Four Digit V-Code SUBTOTAL WI ReSIdenTS Add 5% SALeS TAx SHIPPIng/HAndLIng (See CHART BeLOW) TOTAL Make checks payable to: AmeRICAn OPInIOn BOOK SeRvICeS ___ ___ ___ ___ ___ ___ ___ # _________________________________________ Exp. Date ________________ For shipments outside the U.S., please call for rates. Signature ___________________________________________________________ Order Subtotal Standard Shipping Rush Shipping $0-10.99 $3.95 $8.95 Standard: 4-14 $11.00-19.99 $6.75 $11.75 business days. mail completed form to: $20.00-49.99 $8.95 $13.95 Rush: 3-7 business American Opinion Book Services AOBS • P.O. BOX 8040 APPLETON, WI 54912 $50.00-99.99 $11.75 $16.75 days, no P.O. Boxes, Order Online: w w w . a o b s - s t o r e . c o m $100.00-149.99 $13.95 $18.95 HI/AK add $10.00 $150.00+ call call Credit-card orders call toll-free now! 1-800-342-6491 080428
  • 3. Connect with something big. Be one of the many dedicated Americans working together to build a better world. Visit the JBS.org Freedom Campaign Meetup Alliance. www.meetupalliance.com/jbs JBS.org
  • 4. 12 Vol. 24, No. 9 April 28, 2008 Cover Story TERRORISM 12 A Bad Investment Design by Joseph W. Kelly by William F. Jasper — U.S. support for so-called “moderate” terrorists, as we have given in Palestine, is a recipe for disaster. 18 Global Blowback by William F. Jasper — Backing terrorists and terror regimes has come back to haunt us. 18 20 FeatureS CONGRESS 20 House Holds Rare Secret Session AP Images AP Images by Alex Newman ECONOMY 21 The Money Trust’s Next Move 21 by Charles Scaliger — The looming financial crisis has set the stage for giving the Fed broad powers over the entire financial sector. 24 Don’t Spend Money; Save It by Llewellyn H. Rockwell, Jr. — The Bush administration wants us to spend our way out of recession, but that won’t work. INTERVIEW 27 Defending Gun Ownership AP Images Interview of Larry Pratt by John F. McManus BOOK REVIEW 30 Creating Corruption 24 27 by Gregory A. Hession, J.D. — Once the cradle of liberty, Massachusetts now has become a cesspool of political corruption. The New American HISTORY — PAST AND PERSPECTIVE 35 Cuba Under Fidel and Raul AP Images by John F. McManus — The island nation has suffered greatly under the Castros. 30 35 DepartmentS 5 Letters to the Editor 41 Exercising the Right AP Images 7 Inside Track 42 Correction, Please! 11 QuickQuotes 44 The Last Word 33 The Goodness of America COVER Design by Joseph W. Kelly
  • 5. Mix or Match for Sp ecial Quant it Discou y nts A Bad Investment Both before and during the “war on terror,” the U.S. government has given money, arms, and military training to groups which could ostensibly help accomplish its objectives. But events have shown that the groups we are aiding — like the Palestinian Authority — are often as destructive as the enemy we are fighting. (April 28, 2008, 48pp) TNA080428 Freedom’s Call 2008 Climate Debate T he N ew A mericAN champions a Despite bold assertions that human-caused global return to constitutional principles warming is an established fact — such as the Denver to safeguard our rights and our Post’s claim that “you could have a convention of way of life, but this is only part all the scientists who dispute climate change in of the solution. A recommitment a relatively small phone booth” — a convention to traditional morality, family- in New York brought together over 100 of the centered ideals, and sound money world’s top scientists who dispute conventional are also needed to preserve liberty global-warming dogma. (March 31, 2008, 48pp) and prosperity. This issue tells why. TNA080331 (April 14, 2008, 48 pp) TNA080414 Special Report: Merger in the Making Who’s Listening In on You? The importance of this special edition on the North Is the Federal Intelligence Surveillance American Union cannot be overstated. It tells how Act’s new revision called the Protect U.S. political and business elites are working below America Act too intrusive on Americans’ the radar to merge the United States, Mexico, and privacy? Get the answers here. (March Canada into an entity similar to the European 17, 2008, 48pp)TNA080317 Union — and how it will affect you if they succeed. (October 15, 2007, 48pp) TNA071015 ✁ Quantity title/Description total price A Bad Investment Name ______________________________________________________________ Freedom’s Call Mix or Match Address ____________________________________________________________ ❏ 1 copy $2.95 2008 Climate Debate ❏ 10 copies $12.50 City _____________________________ State __________ Zip ________________ ❏ 25 copies $22.50 Who’s Listening In on You? 100+ copies* Merger in the Making Phone ____________________________ E-mail ______________________________ EntER MIx oR MAtCh QuAntItIES AnD SuBtotAL ❑ Check ❑ ViSA ❑ Discover 000 0000 000 000 0000 0000 0000 0000 0000 ❑ Money Order ❑ MasterCard ❑ American Express Visa/Mc/Discover three Digit V-code american express Four Digit V-code SUBTOTAL WI RESIDEntS ADD 5% SALES tAx ShIppIng (SEE ChARt BELoW) totAL Make checks payable to: AMERICAn opInIon Book SERvICES ___ ___ ___ ___ ___ ___ ___ # _________________________________________ Exp. Date ________________ For shipments outside the U.S., please call for rates. Signature ___________________________________________________________ Standard: 4-14 order Subtotal Standard Shipping Rush Shipping business days. MAIL CoMpLEtED FoRM to: $0-10.99 $3.95 $8.95 Rush: 3-7 business AOBS • P.O. BOX 8040 $11.00-19.99 $6.75 $11.75 days, no p.o. Boxes, American Opinion Book Services APPLETON, WI 54912 $20.00-49.99 $8.95 $13.95 hI/Ak add $10.00 order online: w w w . a o b s - s t o r e . c o m 1-800-342-6491 *Buy case lots of 100 at a special rate of $75.00. See case-lot shipping rates on card tab between pages 38 and 39. Credit-card orders call toll-free now! 080428
  • 6. LETTERS TO THE EDITOR Publisher John F. McManus Editor Treading on Amerityre thane to make auto tires, only retreads for Gary Benoit I just read, with great excitement, James enormous tires used on mining vehicles. Perloff’s article on Amerityre (February 18 Mr. Rose calls this a “life-draining part- Senior Editor issue) and immediately went to the compa- nership with China,” implying it will con- William F. Jasper ny’s website to see how we could purchase sume American jobs. Why aren’t the retreads Associate Editor these American-made polyurethane tires U.S.-made? First, tiny Amerityre lacks the Kurt Williamsen and invest in such a fantastic new American capacity to retread these huge mining tires. enterprise. Much to my shock and dismay, Efforts by U.S. companies to make such re- Contributors Dennis J. Behreandt I found their 2007 Shareholder Meeting treads from rubber have proven unsuccess- Christopher S. Bentley Presentation to be loaded with references to ful, because heat from prolonged vulcani- Steven J. DuBord global markets and global manufacturing. zation makes the tires unstable. Amerityre Jodie Gilmore Then to make matters worse, their major had hoped a U.S. company would try it with Gregory A. Hession, J.D. investor in Composite Tires refers immedi- their polyurethane, but to date no American Ed Hiserodt ately to signing agreements with Communist company has been willing. Therefore the William P. Hoar R. Cort Kirkwood China, as if this is a natural formula for suc- Qingdao Qizhou arrangement threatens no Warren Mass cess with any new American enterprise. It is U.S. jobs. Amerityre hopes it will motivate Llewellyn H. Rockwell, Jr. also assumed then that both manufacturing U.S. companies to come on board, manufac- Ann Shibler and distributing for Amerityre composite turing retreads here at home. Michael E. Telzrow products will be done in China, not in the Also, what about Amerityre’s American Joe Wolverton II, J.D. U.S.A. Amerityre says in a slide presentation deals? On February 8, Michigan-based Editorial Assistant that they have a “signed agreement with [a] Amigo Mobility, which makes shopping Denise L. Behreandt Chinese partner” and that they shipped the vehicles for the disabled, announced it is “largest pour machine in the world” to their switching to Amerityre’s polyurethane tires. Art Director Joseph W. Kelly “launch partner” China, a machine that pro- “Amerityre shares our business ideals,” said cesses 3,000 lbs. per minute. Could James Amigo president Al Thieme, “and believe[s] Desktop Publishing Specialist Perloff have missed this life-draining part- in producing high quality goods that are Steven J. DuBord nership with China and Amerityre when he made in America.” Amerityre will initially Research researched this “entrepreneurship” article? supply Amigo with 25,000 tires per year — Brian T. Farmer Amerityre founder Richard Steinke is completely American-made. Bonnie M. Gillis quoted in The New AmericAN as saying, “In Last year, Amerityre signed an agreement Wayne Olson other countries, they’re afraid to innovate.... with Arizona-based DRT, which manufac- The great thing about America is, you can tures tires for sand-racing cars. DRT will use Marketing Larry Greenley fail, and keep on trying.” Could the reason Amerityre’s technology to build its products why other countries do not innovate be be- — again, entirely American-made. Public Relations cause Americans love to innovate and spend While I commend Mr. Rose’s patriotic Bill Hahn the time and money here to create an incred- economics, I think it unfair to focus solely Advertising/Circulation ible product, only to sell it to non-innovat- on Amerityre’s one Chinese contract and Julie DuFrane ing (socialist/communist) countries who are call the company “Chinatyre,” as if it were a more than willing to capitalize on it? multinational corporation seeking to under- After my short visit to Amerityre’s web- mine the home job market. There are plenty site, I am not at all interested in purchasing of those, but Amerityre isn’t one. or investing in “Chinatyre.” Is there anyone loyal to America anymore? Do the Chinese Regarding your story about Amerityre, as a Printed in the U.S.A. • ISSN 0885-6540 P.O. Box 8040 • Appleton, WI 54912 spell tire as “tyre”? Is that how the name longtime General Motors employee, I would 920-749-3784 • 920-749-3785 (fax) “Amerityre” came about? like to point out the mistake that Mr. Perloff www.thenewamerican.com STeve roSe and many others ignorant of automotive his- Rates are $39 per year (Hawaii and Canada, Steamboat Springs, Colorado tory make. It was Ransom Olds, not Henry add $9; foreign, add $27) or $22 for six months (Hawaii and Canada, add $4.50; foreign, add Ford, who had the first automotive assembly $13.50). Copyright ©2008 by American Opin- James Perloff responds: I fully agree with line in 1901. He produced the curve dash ion Publishing, Inc. Periodicals postage paid at keeping manufacturing in America; unlike Oldsmobile on an assembly line from 1901 Appleton, WI and additional mailing offices. Post- master: Send any address changes to The New many conservatives, I even support tariffs on to 1904. Checking back on our automotive AmericAN, P.O. Box 8040, Appleton, WI 54912. imports. Amerityre’s only plant is in America; history you will find that Ford Motor Co. is all its products are made here. To say Ameri- often credited with innovations that it stole The New AmericAN is pub- lished biweekly by Ameri- tyre is “signing agreements with Communist from others. The automotive assembly line can Opinion Publishing China” is distorting — it has one contract was not a Ford innovation! Inc., a wholly owned subsidiary of The John with one Chinese company, Qingdao Qizhou. michAel Powell Birch Society. The latter is not using Amerityre’s polyure- Clarkston, Michigan THE NEW AMERICAN • APRIL 28, 2008 5
  • 7. Inside Track 2003 Justice Department Memo Authorized Military Torture A March 14, 2003, memorandum written by Deputy Assistant an enemy combatant during an interrogation in a manner that Attorney General John C. Yoo of the U.S. Department of Jus- might arguably violate a criminal prohibition, he would be doing tice’s Office of Legal Counsel granted military interrogators so in order to prevent further attacks on the United States by the broad authority to use harsh methods in questioning suspects al Qaeda terrorist network. In that case, we believe that he could deemed “unlawful combatants.” Yoo’s memo, the subject of argue that the executive branch’s constitutional authority to pro- which was “Military Interrogation of Alien Unlawful Combat- tect the nation from attack justified his actions.” ants Held Outside the United States,” was addressed to William In response to the release of the memo, Senator Patrick J. J. Haynes II, general counsel of the Department of Defense. Leahy (D-Vt.), chairman of the Judiciary Committee, said it re- Haynes had requested that the Justice Department examine the vealed policies that threatened “our country’s status as a beacon legal standards governing military interrogations of such unlaw- of human rights.” ful combatants. The memo, made public on April 1 following declassification in response to a request by the American Civil Liberties Union under the Freedom of Information Act, rambles on in often de- tached, clinical language for 81 pages. For example, a section sub-headed “Severe Pain or Suffering” states: “The key statu- tory phrase in the definition of torture is the statement that acts amount to torture if they cause ‘severe physical or mental pain or suffering.’ [Legal case citation] makes plain that the infliction of William J. pain or suffering per se, whether it is physical or mental, is insuf- haynes II ficient to amount to torture. Instead, the pain or suffering must be ‘severe.’... Thus, the adjective ‘severe’ conveys that the pain or suffering must be of such a high level of intensity that the pain is difficult for the subject to endure.” Yoo applied an end-justifies-the-means constitutional stan- dard when he wrote: “If a government defendant were to harm AP Images Supreme Court Ruling Rebukes President Bush Mexican national Jose Medellin was arrested, tried, and convicted Bush “had exceeded his constitutional authority by intruding into for raping and murdering two Texas teenagers in 1993. He was the independent powers” of his state’s judicial system. So the awarded the death penalty. But because he was not advised of a lawyers for the convicted criminal appealed further to the Su- right to receive legal assistance from the Mexican consul, Mexico preme Court of the United States. sued the United States on his behalf in the World Court, a United On March 25 of this year, the Supreme Court rejected this lat- Nations body. In 2004, the World Court ruled that the United est appeal in a 6-3 ruling and effectively told the president that his States must reopen powers are not unlimited. Chief Justice John Roberts stated that the case. President Article 94 of the UN Charter provides only that “each member John Roberts Bush promptly an- of the United Nations undertakes to comply” with World Court nounced his sup- decisions, and that further action by Congress would be needed port for the World if the United States were to be subject to World Court decisions. Court’s ruling and In his dissent, Justice Steven Breyer pointed to the Constitu- told Texas to com- tion’s Article VI and claimed that treaties — such as the ques- ply with it. tionable characterization of U.S. entry into the UN in 1945 as a Medellin’s law- treaty — supersede the Constitution. Breyer’s contention is not yers went back to supported by history. His attitude was roundly rejected by Hamil- court in the United ton, Madison, and Jefferson, the men who wrote and commented States, but the Texas on the very point raised by Breyer. Court of Criminal Yes, Medellin’s conviction has been upheld. Yes, Bush’s latest Appeals rejected grab for imperial power has been stifled. But the Supreme Court their appeal in 2006. has indicated that should Congress enact legislation to comply Texas Judge Mi- with World Court decisions, the Constitution could find itself chael Kaesler even relegated to an inferior position vis-à-vis the United Nations and AP Images stated that President its subsidiary bodies. THE NEW AMERICAN ••APRIL 28, 2008 THE NEW AMERICAN APRIL 28, 2008 7
  • 8. Inside Track Promised EU Referendum Won’t Be Allowed in Britain When the 2004 EU Constitution was making its way toward Former French President Giscard D’Estaing served as chair- ratification by all EU nations, French and Dutch voters issued a man of the group that created the rejected constitution. He has resounding No in referenda in their nations. Because acceptance stated that “the difference between the original treaty and the by all nations is required, that killed the constitution. So the Eu- present Lisbon Treaty is one of approach, not of content.” Italy’s ropean world planners went back to the former Prime Minister Giuliano Amato, drawing board. In 2007 at a gathering D’Estaing’s vice chairman in creating in Lisbon, the leaders of the 27 EU na- the rejected constitution, says of the of- tions produced a new document called ficials who created the new treaty, “They the “EU Treaty.” decided that the document should be Treaty ratification has begun, and the unreadable” so it could be foisted on an British people were gearing up for the unknowing public. Former Irish leader promised referendum in their country. Garrett Fitzgerald approvingly referred But it won’t happen. The British parlia- to the new treaty as “virtual incompre- ment, heavily influenced by new Prime hensibility.” And Germany’s Chancellor Minister Gordon Brown, told angry Angela Merkel supports the treaty be- Britons, “If this was a constitutional cause “the substance of the constitution treaty, we would hold the referendum. is preserved.” So, the angry Brits have a But the constitutional concept was right to demand that the promised refer- abandoned.” endum will occur. But it won’t. AP Images Free Speech in Broadcasting Threatened by Fairness Doctrine If Democrat leaders get their way, the Fairness Doctrine, a policy into self-censorship, thus abridging their constitutionally guaran- abolished by the Federal Communications Commission in 1987, teed right to free speech. Making matters worse, foxes were in will be reinstated to regulate the opinions aired by broadcasters. charge of the chicken coop. Both Democrat and Republican ad- Talk-radio and religious broadcasters would be significantly im- ministrations in the ’60s and ’70s manipulated the FCC, using the pacted. Democrat leadership has called for it, including House Fairness Doctrine litigation threat to silence opposition, under the Speaker Nancy Pelosi. pretext of enforcing the fair use of scarce frequencies. In 1987, Half a century ago when stations were few, the FCC required the FCC revoked the Fairness Doctrine. broadcasters to provide air time (paid or unpaid) for opposing To prevent reinstatement of the Fairness Doctrine “The Broad- viewpoints about controversial issues of public importance (as caster Freedom Act of 2007” was introduced in the House as H.R. determined by bureaucrats). Offending the FCC resulted in fines 2905 and in the Senate as S. 1748. For more information, go to or a loss of broadcasting privileges. That intimidated broadcasters www.thenewamerican.com/node/7658. Ron Paul Congratulates the John Birch Society on 50th Anniversary Congressman Ron Paul foster ‘less government, more responsibility, and — with God’s has endorsed the John help — a better world.’” Birch Society in a state- John McManus, president of JBS, responded, “We graciously ment recently received accept Dr. Paul’s endorsement. He continues to demonstrate what from his office. Dr. Paul an elected official should be doing … obeying the Constitution. stated, “The John Birch We thank him for his continuous commitment to protect the free- Society is a great patriotic doms of all Americans. There’s a reason why he consistently rates organization featuring an toward the top of the Freedom Index, our congressional score- educational program solid- card rating legislators’ votes published twice a year in The New ly based on constitutional AmericAN magazine.” principles. I congratulate Dr. Paul’s endorsement comes after confirmation that he has Ron the Society in this, its 50th agreed to be the keynote speaker at the Society’s 50th anniversary paul year. I wish them contin- celebration, October 2-5, in Appleton, Wisconsin. ued success and endorse The New AmericAN is an affiliate of JBS and John McManus AP Images their untiring efforts to is the publisher of TNA. 8 THE NEW AMERICAN • APRIL 28, 2008
  • 9. States Keep Up the Pressure Against North American Integration Last year the Arizona Senate passed a resolution asking Congress Congress of the United States, and particularly the congressional to withdraw the United States from the Security and Prosperity delegation representing the State of Idaho, to use all their efforts Partnership of North America and block any activity that seeks to to ensure certain conditions for continued NAFTA participation create a North American Union. In contrast, this year the Arizona are met, and in the event of default of such conditions then with- House has taken the lead by passing a similar resolution on March draw to stop additional harm to the American economy and work- 18 by a vote of 37 to 22. In another piece of good news, the Kansas force, loss of sovereignty and border security.” House passed an excellent anti-NAU, anti-NAFTA Superhighway, During the 2007-2008 time period, the number of states anti-NAFTA resolution by a vote of 93 to 28 on April 4. that have passed anti-NAU resolutions in both houses stands Idaho became the first state to ask Congress to withdraw U.S. at five (Idaho, Montana, Oklahoma, South Dakota, and Utah). membership in NAFTA when its Senate passed an anti-NAFTA Twenty-one states have introduced anti-NAU resolutions during bill by voice vote on March 20. Six days later the Idaho House this period. See www.jbs.org/node/3430 for more information passed the same bill by voice vote. The legislation urges “the and updates. Memphis and Illegal Immigration and Enforcement U.S. Immigration and Customs Enforcement (ICE) arrested 34 migrants from Mexico and central America..., an unseen force at workers, identified as Mexican nationals, at Memphis Interna- the bottom rungs of the Memphis area’s most important industry, tional Airport working on the new Tennessee Air National Guard distribution.” The paper added that the major companies in the base. The various contractors who hired them will likely not be area, except FedEx, use the illegals and that there are hard feel- penalized because they’ll say that they didn’t “knowingly” hire the ings between the Hispanics and blue-collar blacks in the Mem- illegal immigrants. If the illegals showed even crudely fraudulent phis area, who would be the main beneficiaries if the Hispanic IDs to get hired, the employers are immune from prosecution. illegal immigrants weren’t there. In fiscal year 2007, ICE arrested 4,077 people on immigration The companies that hire the Hispanics, such as Williams- charges nationwide. Considering there are approximately 14,300 Sonoma, Technicolor Home Entertainment Services (which dis- ICE employees, that’s one arrest for every 31⁄2 employees. Must tributes CDs and DVDs for Disney, Paramount, and Universal), be a tough job! and Microsoft, prefer hiring illegal immigrants because they can Federal officials said that they are focusing immigration en- take on as many workers as they want each day and send the rest forcement efforts on projects where national security is a con- home; they don’t have to give any benefits; and they can hire cern. In other words, they have simply decided to ignore what the workers for $7 to $7.50 per hour. Of course, none of the afore- Commercial Appeal of Memphis describes as “battalions of im- mentioned companies “knowingly” hires illegal immigrants. Charlton Heston Passes Away at 84 Screen legend Charlton Heston, famed for his epic film roles muscular frame of an action star with a sonorous voice, charisma, in the 1950s and ’60s and his activism on behalf of conserva- and the dramatic skills of a classical stage actor. He was also tive political causes in the 1980s and ’90s, passed away at his a leader, serving as president of the Screen Actors Guild for a home in Beverly Hills on April 5. He was 84. His signature per- record six terms, and as president and chairman of the American formances in The Ten Commandments (as Moses), Ben-Hur (as Film Institute. On political and philosophical issues, Charlton Judah Ben-Hur, for which he won a Heston parted ways with many of his best-actor Oscar), and The Agony and celebrity cohorts, most notably on the the Ecstasy (as Michelangelo) estab- Charlton right to keep and bear arms. A princi- heston lished him as Hollywood’s top lead- pled supporter of the Second Amend- ing man for historical, larger-than- ment, he served as president of the life figures. However, he also proved National Rifle Association from 1998 himself equally capable at playing to 2003, and is famously remembered modern characters in a 20th-century for holding an antique musket above setting — or even in the future, as in his head at an NRA convention and his sci-fi classics Planet of the Apes, defiantly pledging that gun-control Soylent Green, and The Omega Man. advocates would not take his gun un- AP Images Heston combined the athleticism, less they could pry it “from my cold, rugged good looks, and tall (6' 3") dead hands.” n THE NEW AMERICAN • APRIL 28, 2008 9
  • 10. K America eep your free... and your family safe. The John Birch Society Standing for Family and Freedom JBS.org/Freedom I S A I A H 4 0 : 3 1 © Retire Safe, Early and Happy... © W. Neil Gallagher, PHD. 1996 All Rights Reserved The Gallagher Financial Group is your personal partner. Every strategy, every portfolio is tailor-made for you, the individual client. For more information on The Gallagher Group, visit www.docgallagher.com or call (800) 434-4362. You can also write us at 1845 Precinct Line Road, Suite 215, Hurst, Texas 76054.
  • 11. QuickQuotes Call It Hubris or, if You Prefer, Unadulterated Arrogance Dick “So?” Cheney When told that two-thirds of Americans do not support the way the war in AP Images Iraq is being conducted, Vice President Dick Cheney gave his disdainful re- sponse to a reporter and then discounted the polling process as unreliable. Bill Richardson’s Endorsement of Obama Draws Fiery Response “His endorsement came right around the anniversary of the day when Judas sold out for thirty pieces of silver, so I think the timing is appropriate.” A supporter of Hillary Clinton for president, James Carville was very unhappy when New Mexico Governor Bill Richardson announced his support for her rival. Ted Has Become a Scientist “Most of the people will have died and the rest of us will be cannibals.” According to Ted Turner, the world will not be a very nice place in 40 years if action isn’t taken to reverse the problem of global warming. Former British Prime Minister Frustrated tony Over Global-warming Indecision Blair “We have an agreement that there should be an agreement. But there’s no agreement on what that agreement should be.” While vacationing at billionaire Richard Branson’s privately owned is- land in the British Virgin Islands, Tony Blair — now a senior adviser to JP Morgan Chase — participated in a conference with several other high rollers who were seeking a solution for a problem many scientists AP Images say isn’t anything but a naturally caused phenomenon. Automakers Look to China for Engines and Other Parts “Today, it’s South Korea and Japan, and tomorrow it’s going to be China. It’s only a matter of time before G.M., Ford and Chrysler are going to deal with the crisis they face by going to these countries.... Very few consumers ask: Where is the engine built or where is the transmission made?” At Chevrolet’s Equinox plant in Ottawa, Canada, engines labeled Ecotec, Vortec, and Northstar are installed in the vehicles, prompting union official Basil Hargrove to acknowledge the effect of trade policies he deplores. Texas Congressman Claims “Surge” Is No Success Ron “Under the ‘surge’ policy, the United States military has trained Paul and equipped with deadly weapons those Iraqi militia members against whom they were fighting just months ago. I fear by arming and equipping opposing militias we are just setting the stage for a more tragic and dangerous explosion of violence, possibly aimed at U.S. troops in Iraq.” In his weekly “Texas Straight Talk” column of March 23, Con- AP Images gressman Ron Paul pointed to several aspects of U.S. policy that few others will discuss. Homeland Security Boss Puts Blame for Real ID on Congress Michael Chertoff “Showing up at the airport with only a driver’s license from such a state will be no better than showing up without iden- tification. No doubt this will impel many to choose the in- convenience of traveling with a passport.” Pointing to the holdout states of Maine, Montana, and South Carolina, Michael Chertoff said it was not he but Congress that established the rules that states are now being forced AP Images to adopt. n — comPiled by JohN F. mcmANuS THE NEW AMERICAN • APRIL 28, 2008 11
  • 12. TERRORISM A Bad Investment U.S. support for so-called “moderate” terrorists as the alternative to worse terrorists, as we have given in Palestine, is a recipe for disaster. by William F. Jasper day in April 2006 and dozens more were suicide bombings that have become all too wounded, including the Wultzes, Ameri- familiar in Israel, Iraq, Pakistan, and many Blowback: Unintended negative cans from Florida who were visiting Israel other parts of the world. consequences from some action or on vacation. Daniel, who was the more se- Few Americans are aware, however, policy. verely injured of the two, lost his spleen, a that the deadly attack that took the life kidney, and a leg in the blast. Despite the of Daniel Wultz was planned and car- T uly Wultz and his 16-year-old son heroic efforts of doctors, he died a month ried out by U.S.-trained terrorists of the Daniel were enjoying a Passover later in an Israeli hospital. Because Daniel PLO’s (Palestine Liberation Organization) holiday dinner at a Tel Aviv restau- Wultz was an American, the terror attack notorious al-Aqsa Martyrs Brigades. The rant when the suicide bomber struck. Nine that claimed his life received more atten- Brigades, which are formally listed as a diners were killed in the grisly attack that tion in the U.S. media than the “typical” terrorist organization by the U.S. State De- 12 THE NEW AMERICAN • APRIL 28, 2008
  • 13. partment, have carried out numerous sui- deputy commander of the cide bombings, car bombings, shootings, Brigades in Nablus and the and rocket attacks. Nevertheless, they are West Bank, called Wultz’s Mahmoud Abbas’ pLo/Fatah is the same a major military arm of Palestinian Au- passing a “gift from Allah.” organization that Yassir Arafat founded thority President Mahmoud Abbas’ PLO/ Abu Aziz’s cell directed nearly half a century ago. that the Fatah organization. As such, they share in the bombing that killed the hundreds of millions of U.S. taxpayer Wultz.... u.S. government not only provides it dollars that annually are showered on the Abu Aziz went on to with financial, military, and diplomatic Abbas-led Palestinian regime. pledge more suicide bomb- But cash is not the only thing the U.S. ings inside Israel. “We will support, but also overlooks and covers government lavishes on the Palestinian hit whenever we think it is up its terrorist activities, is indefensible. Authority. Incredibly, it also sends Abbas suitable and do not expect and his colleagues tons of arms as well that I give details but we can — along with training in military tactics, hit everywhere,” he said. Palestinian Authority to the White House intelligence gathering, and explosives. All on November 26, 2007. “Thank you for of this is done for the ostensible purpose of “Our money helped pay for the death of coming,” he continued, “and thank you for supporting the “moderate” Palestinian ter- Wultz and so many others,” Klein charges. working hard to implement a vision for a rorists under Abbas against the supposedly And he provides details and hard proof to Palestinian state. We want to help you. We more radical Hamas terrorists. back up the charge, showing case after want there to be peace. We want the people The al-Aqsa Martyrs Brigades claimed case of the U.S.-backed Abbas “moder- in the Palestinian Territories to have hope. responsibility for the bombing in which ates” carrying out deadly terrorist attacks, And we thank you for your willingness Daniel Wultz was murdered. American including attacks on Americans. It should to sit down with Israel to negotiate the journalist Aaron Klein, who has met and be clear to all but the willfully blind that settlement.” interviewed many of the Palestinian terror- Mahmoud Abbas’ PLO/Fatah is the same It was the eve of the Annapolis Confer- ist leaders, reports in his book, Schmooz- vicious terrorist organization that Yassir ence, which would initiate a flurry of dip- ing With Terrorists: Arafat founded nearly half a century ago. lomatic activity culminating in the Decem- That the U.S. government not only provides ber “donors conference” in Paris. And the The cell of the Brigades that directed the Abbas terror apparatus with financial, Paris confab would result in total pledges the attack … happens to be one of military, and diplomatic support, but also of $7.5 billion to the Palestinian Authority. the groups I am closest to. Accord- systematically overlooks and covers up its In January 2008, President Bush journeyed ing to Brigade sources, the entire terrorist activities, is indefensible. to the West Bank city of Ramallah, where bombing operation — from the plan- he met Abbas at the Muqata, the infamous ning to the recruitment of the suicide The Granddaddy of Terror PLO headquarters where Yassir Arafat and bomber — was carried out by Fatah’s “It’s good to have you back here in the Abbas had harbored many of the world’s Brigades.... Oval Office,” said President Bush, wel- most-wanted fugitive terrorists. In March, The very crew who sent the bomb- coming President Mahmoud Abbas of the Vice President Dick Cheney duplicated er into Israel to gravely injure Daniel Wultz consisted of none other than the U.S.-trained Brigades leaders who walk around with American- provided assault rifles. Klein, the intrepid Jerusalem bureau chief for World Net Daily, talked to the terrorists responsible for the attack. They were un- apologetic and pledged more of the same. Klein reported: American-trained Nasser Abu Aziz, Blowback victim: Relatives and friends of U.S. teenager Daniel Wultz touch his coffin during a memorial service. Wultz died of wounds sustained in a suicide bombing by a member of the al-Aqsa Martyrs Brigades, many of AP Images whose members are trained and funded by the United States. THE NEW AMERICAN • APRIL 28, 2008 13
  • 14. TERRORISM fat had been transformed, in feigned renunciation of “the use of terror- much of world opinion, from ism and other acts of violence.” through successive u.S. administrations, a brutal terrorist thug run Much of the PLO’s most violent dirty as Arafat and the pLo were elevated by the Soviet KGB into the work (under both Arafat and Abbas) has “moderate” elder statesman been carried out by the al-Aqsa Martyrs to new heights of respectability, the of the Palestinian people. He Brigades, which compete with Hamas in secrecy surrounding Arafat’s guilt in the presided over a global empire the suicide bombing category. For public khartoum murders was maintained. It that included an estimated relations with the West, Arafat tried to $10 billion-$50 billion in distance himself from the Brigades’ grisly was not until 33 years later that the truth cash, commercial assets, and attacks. But documents surfaced showing was finally admitted. investments and an annual that Fatah was funneling large sums to the revenue of $1.5-$2 billion Brigades, and it was difficult to hide the from donations, extortion, fact that many of al-Aqsa’s top command- the trek to the Muqata, to coincide with drug trafficking, arms dealing, and other ers were also high-ranking officers in Ara- the delivery of a no-strings-attached $150 activities. fat’s inner circle. million payment from the U.S. taxpayers Mahmoud Abbas, Arafat’s longtime From their Soviet advisers, Arafat and to the Abbas government. lieutenant, has further advanced the PLO’s Abbas learned the art of creating “deniable In the world of terrorism, no organiza- march toward international respectability, assets” to shield the PLO from the reper- tion has enjoyed a more charmed existence thanks partly to his personal style: in con- cussions of its most reprehensible acts. In than Yassir Arafat’s PLO/Fatah. No matter trast to Arafat’s perennial stubble, grubby the early 1970s, Arafat created a special how much murder and mayhem he dished fatigues, trademark Keffiyeh scarf, and terror squad, the Black September Organi- out over the decades, Arafat could always generally crude, slovenly persona, Abbas zation, to carry out the PLO’s most notori- depend on support not only from the So- always appears as the soft-spoken, well- ous deeds — but without any apparent ties viet and Third World blocs, but also from groomed, grandfatherly diplomat in a to the PLO. Arafat would disavow them the United Nations and much of the Is- business suit. More important, however, as renegades, even though they operated lamic world. And increasingly in his later than the stylistic change from Arafat to under his direction. years, his stature inflated by White House Abbas has been the rise of Hamas, which, In 1973, Arafat’s Black September ter- visits, international conferences, a Nobel at times, can make the PLO/Fatah look rorists stormed the Saudi Arabian embas- Peace Prize, and sympathetic media cov- reasonable by comparison. But by far sy in Khartoum, taking U.S. Ambassador erage, Arafat and the PLO assumed an air the biggest factor in transforming first Cleo Noel, U.S. Charges d’Affaires George of legitimacy. Arafat, and now Abbas, into “moderates” Moore, and Belgian diplomat Guy Eid By the time of his death in 2004, Ara- has been the willingness of Western gov- hostage. The following day they brutally ernments and the Western press to turn tortured and executed all three men. Arafat a blind eye toward, or even actively to feigned innocence — and the U.S. govern- Zakaria Zubeidi, the al-Aqsa Martyrs cover up, the fact that the PLO contin- ment feigned belief in his innocence. Brigades leader in the West Bank, is carried by ues to be one of the most violent terror- Deception of this sort is to be expected supporters during a 2004 rally in support of PLO’s Mahmoud Abbas. ist organizations in the world, despite its of a terrorist. However, far more repre- Zakaria Zubeidi and fellow al- Aqsa terrorists carry “moderate” Mahmoud Abbas on their shoulders in a 2004 West Bank rally. AP Images AP Images
  • 15. hensible and shocking is the fact that the U.S. government and other Western gov- ernments gave credence to this charade for decades, even though they had proof it was a lie. In the case of the Khartoum operation, for example, we had ironclad proof that Arafat had ordered the murder of our officials. For years, James J. Welsh, a National Security Agency analyst, had been trying AP Images to force this fact into the open. Welsh had been the NSA’s Palestinian analyst who intercepted Arafat’s voice transmission specifically ordering the execution after the hostage takeover. However, apparently False peace: Israeli prime Minister Yitzhazk Rabin, president Clinton, and pLo Chairman under the orders of Henry Kissinger, then Yassir Arafat at the signing of the 1993 peace accord between Israel and the pLo. President Nixon’s National Security Ad- viser (and soon to be secretary of state), the existence of the tapes and transcripts approval of Yasir Arafat, Chairman of the shortwave radio transmission from Beirut of Arafat’s order were kept secret. Palestine Liberation Organization (PLO), to Khartoum. After the murders had been Through successive U.S. administra- and the head of Fatah.” The report also completed, Arafat instructed his men: tions, as Arafat and the PLO were elevat- notes that “Fatah representatives based in ed to new heights of respectability, the Khartoum participated in the attack, using Your mission is ended. Release Saudi secrecy surrounding Arafat’s guilt in the a Fatah vehicle to transport the terrorists to and Jordanian diplomats. Submit in Khartoum murders was maintained. It was the Saudi Arabian embassy.” It goes on to courage to Sudanese authorities to not until 33 years later that the truth was state that after the terrorists “had received explain your just cause to [the] great finally admitted. orders from Fatah headquarters in Beirut, Sudanese Arab masses and interna- they killed the two United States officials tional opinion. We are with you on Truth About PLO/Fatah Revealed and the Belgian Charge.” the same road. In May 2006 — two years after Arafat’s According to a 1975 U.S. government- death — a declassified document concern- commissioned Rand Corporation report Mahmoud Abbas almost certainly was also ing the kidnapping/murder was posted, on the attack, Arafat personally gave personally involved in the attack. Abbas, unannounced, on the State Department the order to execute the Americans via a according to a number of credible sources, website. The document, a summary of the terrorist event, acknowledges that the Khar- toum operation “was planned and carried out with the full knowledge and personal Allies, Not Enemies W hile Hamas and the Arafat/Abbas-led PLO often have engaged in bitter rivalry, they also have been allies in joint terror operations. On December 14, 2004, for instance, the Abbas/PLO-controlled Voice of Palestine (VOP) radio proclaimed that the bombing and shooting attack the previous day, which had killed several Israelis at a border crossing checkpoint, had been a joint Hamas-Fatah operation. VOP regularly praises Hamas suicide bombers as “heroic martyrs.” Many PLO/Fatah terrorists, includ- ing members of Abbas’ elite Force 17, are also members of Hamas units. In 2005, Palestine Authority President Mahmoud Abbas journeyed to Damascus, Syria, where he met with Hamas chief Khaled Meshaal. He has been in negotiations with Meshaal ever since, trying to arrange a Fatah/Hamas “unity” government for Palestine. In 2007, Hamas spokesman Abu Abdullah confidently stated that U.S. weapons given to Fatah will eventually end up in the hands of Hamas fighters, telling Aaron Klein: “These American weapons will be one day the property of all the Palestinian people and its resistance, including Hamas.” “The US gives weapons to Fatah during internal Palestinian clashes, but one day when we go back to carrying out operations together, these (weapons) will be shared.” n — williAm F. JASPer 15
  • 16. TERRORISM military assistance and training to Ara- fat’s various “police” and “security” units. CIA, FBI, and U.S. military personnel were given the task of providing Arafat’s forces with advanced training in weapons, tactics, intelligence, counterintelligence, communications, and other skills. Clin- ton’s CIA director George Tenet began bringing squads of PLO snipers to Vir- ginia to receive instruction in advanced marksmanship. Over the past few years, the Bush administration has dramatically escalated the provision of U.S. armaments AP Images and military training, with thousands of automatic rifles and sniper rifles and mil- lions of rounds of ammunition going to the PLO. On May 23, 2007, Lieutenant General President Bush walks with palestinian Authority Chairman Mahmoud Abbas at the Muqata, Keith Dayton, the Bush administration’s the pLo’s infamous headquarters in the West Bank city of Ramallah on January 10, 2008. Security Coordinator for Palestine, testi- fied before a House subcommittee on the was in charge of financing the much more Oh warrior brothers, this is a na- supposed need to fund President Abbas’ well-known terror operation of the previ- tion that will never be broken, it is “security forces,” a euphemism for the ous year, the Black September attack on a revolution that will never be de- collection of terrorist thugs from the al- the 1972 Munich Olympics, in which 11 feated. This is a nation that gives an Aqsa Martyrs Brigades, Islamic Jihad, Israeli athletes were murdered before a example every day that is imitated Force 17, and various other PLO/Fatah worldwide audience. Arafat feigned in- across the world. We gave the world militias. “I am committed personally and nocence in this action as well. However, the children of the RPG [Rocket Pro- professionally,” said Gen. Dayton, “to according to Abu Daoud, the Black Sep- pelled Grenades], we gave the world putting the $59 million authorized to me tember commander who led the Munich the children stone [-throwers], and by the Congress to the uses you intended operation, the entire attack was planned we gave the world the male and fe- with the Presidential Guard … and the and blessed by Arafat. And Abbas, in ad- male Martyrdom-seekers [suicide Office of National Security under Presi- dition to arranging the finances for the bombers]. dent Abbas. We must remain mindful of operation, joined Arafat in kissing Abu the dangerous challenges facing Abbas’s Daoud and wishing him luck on the ter- Zecharias Zubeidi, commander of the security forces, and continue to encour- rorist attack. Martyrs Brigades in Yaabid and Mahmoud Abbas continues the same Jenin, is especially proud of the deception today, with the active conniv- newly paved main street in Yaa- ance of our government officials. Sec- bid, paid for with $402,000 from retary of State Condoleezza Rice in her the U.S. foreign-aid program. testimony before the House Committee That street has been renamed in on Foreign Affairs on October 24, 2007, honor of former Iraqi dictator stated: “We will be seeking funds to sup- Saddam Hussein to show, says port the government of … Mahmoud Zubeidi, that “Saddam Hussein Abbas because we believe, as I said, that is still alive.” Mahmoud Abbas is the best chance for a moderate Palestin- has made a point of publicly ian government.” embracing Zubeidi and cam- Moderate? In 2004, Abbas openly ad- paigning with him on the streets mitted that the al-Aqsa Martyrs Brigades of Jenin. And he has made sure are part of PLO/Fatah, and his Brigades that Zebeidi and other Brigades commanders are some of the most notori- commanders — such as Abu ous terrorist leaders and recruiters of sui- Yousuf, Ala Senakreh, Nasser cide bombers. Abu Aziz — are provided with On November 14, 2006, Ahmed Hales the best weapons and training Abu Maher, the secretary of PLO/Fatah in the U.S. can provide. Gaza, declared on the Abbas-controlled In the late 1990s, the Clinton Palestinian Authority TV: administration began providing AP Images 16
  • 17. age our European and Arab partners to complement our efforts with their own assistance.” The arming and training of the Abbas- led forces has been sold to the American public as necessary to prevent a takeover by the supposedly more radical Hamas forces. However, as terrorism expert Ra- chel Ehrenfeld emphatically notes, there’s virtually “no difference” between Hamas and our Arafat/Abbas PLO “peace part- ners.” Dr. Ehrenfeld, the author of Nar- co-Terrorism and Funding Evil, told The New AmericAN: “Both [Hamas and Fatah] carry out suicide bombings, murder, kid- AP Images napping, assassination, rocket attacks on civilian neighborhoods, extortion, drug trafficking — you name it. They both hate Israel and the United States and are com- Unity in terror: Mahmoud Abbas shakes hands with Palestinian Prime Minister ismail Haniyeh mitted to our destruction. Show me the dif- as Hamas chief Khaled Meshaal (center) looks on. The rival Palestinian leaders met in Mecca in ference [between them].” February 2007 to discuss a Hamas-PLO coalition government. In Schmoozing With Terrorists, Aaron Klein has al-Aqsa Brigades commander of soldiers and settlers. We collected identities of the bombers and would bring Abu Yousuf explain in his own words how information about the best timing to them to justice, but it never has done so. he and his men have put their U.S. training infiltrate our bombers inside Israel. In fact, the man appointed by the PA to to use. “All the methods and techniques We used weapons and we produced investigate the crime, Rashid Abu Shabak, that we studied in these trainings, we ap- explosives, and of course the train- is himself a longtime terrorist. Dr. Nitsana plied them against the Israelis,” Yousuf ings we received from the Americans Darshan-Leitner, director of the Shurat boasted to Klein in an interview. Yousuf and the Europeans were a great help HaDin-Israel Law Center Director, has continued: to the resistance. charged that it is Abu Shabak himself who should be considered the top suspect for We sniped at Israeli settlers and sol- “I do not think,” said Yousuf, “that the mastermind of the bombing. Of course, diers. We broke into settlements and operations of the Palestinian resistance based on Khartoum embassy experience, Israeli army bases and posts. We col- would have been so successful and would and the dissembling and cover-up we have lected information on the movements have killed more than 1,000 Israelis since seen so far in this case, we can expect our 2000 and defeated the Israelis in Gaza government to cover up any evidence that without these [American] trainings.” might implicate our “essential ally” Mah- Very likely, Yousuf or some of his U.S.- moud Abbas in this vicious crime. trained Fatah colleagues were responsible Tragically, as the next article (page 18) for the 2003 murder of U.S. embassy em- shows, the PLO is not the only terrorist ployees John Branchizio, Mark Parson, organization our tax dollars are support- and John Linde, Jr. Their vehicle was de- ing. From the West Bank and Gaza to stroyed by a road bomb as they journeyed Iraq, Afghanistan, Bosnia, Kosovo, Alba- to Gaza to interview Palestinian students nia, and Pakistan, the story is the same. for Fullbright scholarships in the United How many American lives will we allow States. The Palestinian Authority (PA) to be sacrificed to blowback from these stated soon after the blast that it knew the treacherous policies of aiding and abet- ting our enemies? n U.S.-armed terrorists of the al-Aqsa Martyrs Brigades sporting American M16s EXTRA COPIES AVAILABLE (including newer ➧ Additional copies of this issue of versions than supplied to our soldiers in iraq) The New AmericAN are available at in the West Bank city quantity-discount prices. To order, visit of Nablus, November www.thenewamerican.com/marketplace/ 30, 2007. or see the card between pages 38-39. 17
  • 18. TERRORISM AP Images Dechristianization: Hundreds of churches like the one pictured to the left in the town of Djakovica have been destroyed and the Christian population driven out of Kosovo by the U.S.-supported KLA. AP Images “Tolerant” ally? President Bush is shown above promoting dictatorial Prime Minister Sali Berisha during a June 2007 visit to Tirana, Albania. GLOBAL BLOWBACK Backing terrorists and terror regimes has come back to haunt us. by William F. Jasper are certain to bring a torrent of deadly • Albania: The Bush administration is blowback to America for years, if not de- intensifying the love affair begun by Presi- L ong before 9/11, Osama bin Laden’s cades, to come. dent Clinton and Secretary Albright with terrorist activities around the world • Kosovo: In Kosovo, President Bush has the Albanian regime of Sali Berisha. Dur- were being cited as a classic case continued the Clinton policy of supporting ing his historic trip to Albania in 2007 (the of “blowback.” Quite obviously, the CIA’s Hashim Thaci, the Islamo-Leninist leader first by a U.S. president), President Bush support for bin Laden, Ayman al-Zawahiri, of the Kosovo Liberation Army (KLA) ter- praised Albania as “a model of religious and other radical Islamists in Afghanistan rorists. Thaci came to power in this prov- tolerance” and congratulated Berisha for in the 1980s, ostensibly to counter the So- ince of Serbia as a result of our military in- his desire “to fight corruption.” Religious viets, had indeed helped spawn a virulently tervention on behalf of the KLA. For years tolerance? Virtually all non-Muslims have anti-American global terror network that now, the KLA has been carrying out a bru- been driven out of Albania under Berisha, was returning to haunt us. tal campaign of ethnic cleansing against the who is broadly recognized as one of the Unfortunately, aiding al-Qaeda is far Orthodox Christians who still live in Ko- most corrupt rulers in Europe. As presi- from the only “mistake” of this sort to be sovo. Thaci is also the head of the Drenica dent of Albania from 1992-1997, Berisha made by our government. In fact, the top Group of the fearsome Albanian mafia. welcomed Osama bin Laden and his al- policymakers at the State Department and Under his leadership, hundreds of Christian Qaeda cadres into Albania. Now the coun- National Security Council — in both Re- churches and monasteries, many dating to try’s prime minister, Berisha is the benefi- publican and Democratic administrations Medieval times, have been desecrated and ciary of U.S. and NATO assistance, even — seem to have a perverse proclivity for destroyed. Christians have been murdered, as he continues to back Islamic terrorists backing some of the most brutal terrorist robbed, persecuted, and driven out. Kosovo, in neighboring Bosnia and Kosovo. organizations and terror-sponsoring re- the cradle of Serbia’s Orthodox Christian- • Iraq: The U.S. government has sacri- gimes, time after time after time. ity, has been transformed into a Marxist-Is- ficed the lives of thousands of American Here are a few disturbing examples of lamic thugocracy. President Bush’s recog- troops, along with hundreds of billions of the absurd and indefensible “war on ter- nition of Kosovo’s claim of independence dollars, to back the government of Nouri ror” policies that are aiding our enemies in February of this year will accelerate the al-Maliki. But the Maliki government is and undermining our security — and that radical Islamification of Europe. closely allied with Iran — which, the ad- 18 THE NEW AMERICAN • APRIL 28, 2008
  • 19. ministration tells us, is our deadly enemy. It was precisely these same In Iraq’s violent inter-sectarian and intra- kinds of interventionist policies sectarian violence, the administration is (by the usual coterie of policy the top policymakers in both Republican backing “good” Sunni and Shia factions, elites at the State Department, and Democratic administrations seem which have terrorist pedigrees equally as the National Security Council, vulgar as those of the “bad” Sunni and and the CIA) during the 1980s to have a perverse proclivity for backing Shia factions we are opposing. Hence we that produced the Saddam Hus- some of the most brutal terrorist find the U.S. military arming and train- sein threat. Saddam, we were ing the Iranian-backed Badr Brigades and told way back then — against organizations and terror-sponsoring other forces of the Supreme Council for all evidence to the contrary — regimes, time after time after time. the Islamic Revolution in Iraq (SCIRI). was going to be our great ally In fact, our underpaid soldiers are now against revolutionary Iran’s tasked with literally handing out truck- Ayatollah Khomeini. Billions of dollars threat. With the ostensible object of check- loads of cash in stacks of hundred dol- in military, technical, and financial aid ing the Soviet takeover of Afghanistan, our lar bills to Iraqi militia members, many were showered on “ally” Saddam by the CIA-State Department went shopping for of whom are members of (or allies of) “Bush 41” foreign-policy team during the Mujahedeen allies. But instead of support- al-Qaeda and other groups that are kill- Reagan-Bush years. ing the proven pro-American, anti-com- ing our troops. In a February 19, 2008 We know, of course, what that toxic al- munist forces under Younas Khalis, Abdul article entitled “Money Day in Baghdad,” liance with Saddam ultimately begat: not Haq, and Abdul Qadir, they lavished aid U.S. News & World Report correspon- one, but two major wars in Iraq — to make instead on the most virulently anti-Ameri- dent Alex Kingsbury describes the U.S. the world safe from Saddam. can Muslims, such as Gulbadin Hekmatyar “microgrants” program, in which a U.S. It was during that same period that the (a cutthroat warlord who killed more of his Army captain with a backpack jammed same omniscient brain trust devised the fellow Afghans than he did Soviets), and full with $110,000 in hundred dollar bills grand strategy that produced the al-Qaeda the al-Qaeda Arabs under the command hands out packets of $2,500 to of the fanatical Osama bin Laden (supposedly) worthy recipients. and Ayman al-Zawahiri. That, of course, represents but However, even during the late a molecule compared to the bil- 1990s, after the Clinton State De- lions of dollars that were flown partment had declared al-Qaeda into Baghdad on C-130s in the to be a terrorist organization, our first couple years of the war; liter- CIA continued knowingly to arm, ally hundreds of tons of hundred train, and finance al-Qaeda’s most dollar bills stacked and shrink- violent subcontractors in Bosnia, wrapped on pallets — that disap- Albania, Kosovo, and Macedo- peared without any accounting. nia, even as those open bin Laden According to an investigation allies carried out terrible atroci- last year by the House Commit- ties and built their global terror tee on Government Reform and networks. Incredibly, the Bush Oversight, the total of “lost” cash administration has continued may be more than $12 billion. arming and supporting the same But that’s just part of the price sadistic thugs to this day. of placing “moderates” in Iraq’s Countless victims in these government, right? Moderates lands have already experienced like terrorist Member of Parlia- the awful reality of blowback re- ment Jamal Jaafar Mohammed, sulting from the fateful decisions who was convicted of helping of our government to side with plan the 1983 suicide bombing the terrorists. On September 11, of the U.S. embassy in Kuwait. 2001, America received a bitter Or Abdul Aziz al-Halim, a leader lesson in how terrible blowback of both the radical SCIRI mul- can be, as terrorists who had lahs and the United Iraqi Alli- once been hailed as our allies ance, which dominates the Ma- brought death and destruction AP Images liki government. Jamal Jaafar to our shores. How many more Mohammed and Abdul Azziz deadly attacks will be unleashed al-Hakim are two of Iran’s most upon us in the future by terror- ardent supporters in the Maliki ists whom our government today regime. Troubling ties: Iranian president Mahmoud supports as allies? n Ahmadinejad (left) shakes hands with u.S.-backed Iraqi prime Minister nouri al-Maliki in Baghdad on TNA • APRIL 28, 2008 March 2, 2008. 19
  • 20. CONGRESS House Holds rare Secret Session cans without a warrant. Experts say a veto is likely if the legislation makes it to the president’s desk because he insists on pro- President Bush makes tecting the telecom companies, which he a statement on FiSA, March 13, 2008. claims is vital for national security. “Mem- bers of the House should not be deceived into thinking that voting for this unaccept- able legislation would somehow move the process along,” Bush warned in a press conference. He also claims the delay in approving his FISA demands is hampering anti- terrorist efforts, but the NSA already has broad surveillance powers: it can monitor any source for 72 hours by claiming it is trying to obtain a warrant, and it doesn’t need permission to monitor foreigners. AP Images Many analysts believe Bush is simply hoping to protect companies that may have violated the law, so they will be willing to violate it in the future. Here’s what the best information leads us to believe was The companies in question complained discussed in the House’s secret session. about not being able to defend themselves because of the administration’s “state se- crets” proclamations. So, the supposed by Alex Newman caution in going into this direction.” “compromise legislation” agreed to by Kucinich also told the House that some the House replaced immunity with anoth- T he House of Representatives held members felt the country had drifted to- er provision: evidence can be made secret a secret session on March 13 for wards a “national security state” and that while a judge conducts proceedings with- only the sixth time since 1812. in his experience with secret committee out allowing the plaintiff to be present. After being sworn to silence at the request meetings, the information was of “at best The judge could then relate unclassified of Republican leadership, members sup- dubious value” and sometimes untrue or material to the plaintiff if necessary. posedly discussed information relating to misleading. Bush opposes other parts of the House revisions to the controversial Foreign In- He said the secret session of Congress bill as well. For example, before surveil- telligence Surveillance Act (FISA) for an probably had more to do with the ad- lance begins approval by a special court hour behind closed doors. ministration’s efforts to pass the Foreign would be required, except in “emergency” Several representatives rose to express Intelligence Surveillance Act than “with cases. Another provision would establish alarm when the first closed session in any compelling new information about an independent commission to monitor the almost 25 years was proposed, but they national security.” administration’s surveillance activities. eventually withdrew their objections so it If the secret House session was about the Some experts say the House bill is for could proceed. president trying to ram his changes about the most part very similar to the Senate’s, Congressman Dennis Kucinich (D- FISA through Congress, his attempt seems but Senator Jay Rockefeller (D-W.Va.) Ohio) said, “It raises questions about the not to have been fully successful. A mea- has objected to various provisions in the Constitution of the United States,” before sure backed by Democrats was approved House’s bill, and he could prove to be an noting that he knew the House had the by the House 213 to 197 the day after the important obstacle. power to make its own rules and that he session despite supposed opposition from What needed to be kept secret? Nobody would not be attending the session. “We President Bush and Republican senators. can know for sure except those present, ought to be proceeding with the utmost If adopted by the Senate and signed into but the executive branch gives Congress law, the new version would not offer the secret information on a routine basis. The Alex Newman is the president of Liberty Sentinel contested retroactive immunity for tele- difference is that it’s usually done in a Media, Inc. and the executive editor of the Liberty communication companies that illegally closed hearing, not a closed session of the Sentinel of North Central Florida. helped gather information about Ameri- House. n 20 THE NEW AMERICAN • APRIL 28, 2008
  • 21. ECONOMY Banking behemoth: The J.P. Morgan Chase headquarters (center) in New York now seems closer than ever to Bear Stearns (left). in a deal brokered by the Fed, J.P. Morgan Chase will buy Bear Stearns for pennies on the dollar with the help of a $29 billion Fed-backed loan. cial markets and, by extension, the entire economy, for almost a hundred years, has been at the whim of the secretive authori- ties within the Fed, who act in collusion with the Treasury Department, large mon- ey-center banks, and certain privileged securities dealers. Now yet another bust is upon us, trig- gered, at least in the short term, by several years of frenetic malinvestment in high- risk mortgages. By artificially lowering interest rates far below where the free market would tend to set them, the Fed- eral Reserve created unnaturally lax credit markets. As a result, bankers and others participating in the huge U.S. housing mortgage industry were willing to lend to buyers who, in rational market conditions, would not have qualified for mortgages, or who might have qualified under much more stringent terms of repayment. The Federal Reserve’s activities do not tell the entire story, though. Besides easy The Money Trust’s credit and the inevitable inflation it engen- ders, the mortgage market has long been distorted by federal government involve- Next Move ment in the home loan industry, subsidiz- ing loans at taxpayer expense and helping to shield lenders from the consequences of excessive risk. Such conditions inevi- AP Images tably create what economists call “moral hazard,” that is, the tendency for people — in this case, lenders and investors — to behave less responsibly because they The looming financial crisis has set the stage for giving know they will be shielded from the full the Fed broad powers over not just banking but the entire consequences of bad decisions. The activities of the Federal Reserve, financial sector. coupled with the moral hazard created by government regulatory and safety nets, have now combined to give us a perfect fi- by Charles Scaliger tem in 1913, market uncertainty, with the nancial storm — by no means the first in constant cycle of boom and bust spurred modern American history but, if former Fed I t is difficult to assign a starting point by modern banking practices, has been un- chairman Alan Greenspan is right, the most to the ongoing economic crisis that, relenting. The Federal Reserve, America’s severe since World War II. But beyond the according to popular wisdom, origi- central bank, has unlimited and unchecked market fluctuations, media chatter, and dire nated with risky mortgage lending. Since power to create as much (or as little) economic forecasts, the real story — the the creation of the Federal Reserve sys- money as it wants. Because this money is one that will have consequences long after not backed by any fixed standard like gold the current crisis has abated — is the re- Charles Scaliger is a teacher and freelance writer. or silver, the relative health of the finan- sponse of the federal government itself. By THE NEW AMERICAN • APRIL 28, 2008 21
  • 22. ECONOMY On March 11, the Fed freed Goldman Sachs, Lehman Brothers, and up $200 billion of its reserve Morgan Stanley have all “begun to test What Secretary paulson is proposing of treasury securities, to be the new lending mechanism,” according is nothing less than turning the Federal auctioned directly to so-called to an AP report. “primary dealers” (privileged In effect, the Federal Reserve, over Reserve into a Department of homeland investment banks that are al- the past several months, has opened one Security for financial activities, with lowed to buy and sell securities money spigot after another to try to keep the same sorts of inevitable abuses, from the Fed through its weekly the reservoir full — but the dam continues open-market operations). These to crumble. In the midst of the March mad- controls, and institutional incompetence dealers were to be permitted to ness, one of America’s oldest and most as the latter organization. pledge mortgage-backed se- powerful investment banks, Bear Stearns, curities as collateral for these went into free-fall, sparking near panic in 28-day loans. markets worldwide. In response, the Fed every indication, both the Federal Reserve A few days later, the Fed followed up embarked on yet another new adventure — and the Bush administration are determined with a truly remarkable change in policy: the bailout of an investment bank deemed to exploit the financial and economic tur- for the first time since the 1930s, the Fed- too big to fail. What Fed Chairman Ben moil to impose the broadest set of new con- eral Reserve would loan money to invest- Bernanke and his colleagues actually did trols on America’s already tightly regulated ment banks through the “discount win- was broker an emergency backroom deal economy since the 1930s. dow,” the avenue of credit traditionally with JP Morgan Chase & Co., whereby the reserved for commercial banks as a loan New York banking behemoth would buy Regulatory Tsunami source of last resort. Use of the discount up Bear Stearns for pennies on the dollar, The first inkling of the coming regula- window is an old device for managing the with the help of an emergency loan from tory tsunami was last December, when the money supply, but it has become so stig- the Fed. The amount of the loan, $29 bil- Federal Reserve announced the creation matized among commercial banks that lion, would be covered by the Fed if JP of a brand-new facility, the Term Lend- the Fed has been unable to make much Morgan Chase failed to recoup its money, ing Facility, to auction “term funds” (i.e., use of it during the current crisis — until meaning that, yet again, American tax- short-term loans of money created by the now. Investment banks, unconcerned payers would be shaken down for another Fed) to banks at bimonthly auctions. This with appearances, have rushed to take corporate bailout if the deal soured. But if little-heralded event was the beginning advantage of this newest source of cheap, the deal soars, JP Morgan Chase & Co., of a series of initiatives by the Fed to, in direct credit, borrowing tens of billions not the American taxpayers, would reap effect, expand its options for money cre- of dollars daily during the second week the profits. ation, increasing its power over the money alone of the new program. Although the But the consequences of the Bear markets in the bargain. The following three Fed, per its usual practices, has been se- Stearns bailout and recent decisions by the months saw a veritable blizzard of Fed ac- cretive about the new program, keeping Fed to change its relationship with invest- tivity, ranging from frequent and extraor- confidential the names of firms involved, ment banks have set the stage for a regu- dinarily large cuts in “interest rates” (which technically means the “federal funds rate,” the rate at which banks loan funds to one another, usually overnight) to further innovations in credit creation. Two actions in March were especially significant, because they greatly enhanced the degree of Fed involvement with non- bank financial organizations — an omen of things to come, as events are turning out. The stock market is considered a beneficiary of current Fed policy to lower interest rates. But artificially low interest rates cause bad spending and investment decisions AP Images that harm the economy. 22
  • 23. latory revolution with far-reaching conse- quences, one that every American holding a mortgage, investing in stocks and bonds, or enjoying the protection of any kind of insurance should be aware of. In deciding to break with 75 years of precedent and reinvent itself as the lender of last resort for major investment firms Treasury Secretary henry paulson in addition to traditional banks, the Fed proposes giving the Fed “broad powers” and “corrective authorities” has crossed the Rubicon, according to a over the entire financial sector, as Washington Post article in late March. well as the means to snoop on any “This will redefine the Fed’s role,” fi- financial activity anywhere. nance professor and Wall Street historian Charles Geisst told the Post. “We have to realize that central banking now takes into its orbit everything in the financial system in one way or another. Whether we like it or not, they’ve recreated the financial universe.” For one thing, the Post pointed out, the Fed’s decision to bail out a major investment bank will undoubtedly create yet more moral hazard, encouraging large AP Images firms to take greater risks in the future, secure in the belief that the Fed will step in to protect them from the full brunt of their follies. Even more ominously, the U.S. Trea- an organization whose inner workings are tion from commercial banks, investment sury Department, as if on cue, unveiled so secretive that it has never even been banks, insurance companies, hedge funds, on the last day of March a sweeping new formally audited by Congress, is not part commodity pool operators” and “will have proposal to overhaul federal oversight of of any system of checks and balances, broad powers and the necessary correc- every sector of the financial markets, from and has no accountability to the Ameri- tive authorities to deal with deficiencies mortgage companies to insurance broker- can public. that pose threats to our financial stabil- ages to investment firms large and small. Also contemplated in the Treasury re- ity.” This new, steroid-enhanced Fed will, It need hardly be said that “sweeping” is port are a “Prudential Regulator,” a yet- in the Wonderland rhetoric of Secretary synonymous with “unconstitutional”; the unnamed regulatory behemoth in com- Paulson, have “broad powers” and “cor- Bush administration’s new plan, though plete charge of all “firms with federal rective authorities” (note the plural!) over unlikely to be implemented in full right guarantees,” and the “Business Conduct the entire financial sector, as well as the away, contemplates near-total federal con- Regulator,” which would “monitor busi- means to snoop on any financial activity trol over every aspect of American finan- ness conduct regulations across all types anywhere — yet somehow this will not re- cial activity, usefully condensed into three of financial firms,” including “key aspects quire exponential growth both in the regu- gigantic regulatory authorities. of consumer protection such as rule-writ- latory burden and the institutional zealotry ing for disclosures, business practices, and to enforce it. The Federal Reserve on Steroids chartering/licensing.” What Paulson is proposing is nothing Chief among these new authorities, the In announcing the Treasury’s so-called less than turning the Federal Reserve into “Market Stability Regulator,” will be “Blueprint for Financial Reform,” Trea- a Department of Homeland Security for the Federal Reserve itself, remade into sury Secretary Henry Paulson preemptive- financial activities, with the same sorts a central bank-cum-federal regulatory ly fended off those who would criticize the of inevitable abuses, controls, and institu- bureaucracy, the worst new idea to come blueprint for advocating more regulation tional incompetence as the latter organi- out of Washington in a very long time. by claiming they were “over-simplifying zation. As Secretary Paulson was candid The Federal Reserve as Market Stability this critical and inevitable debate.” “The enough to admit, “More effective regula- Regulator, says the Treasury report sum- Blueprint,” he said, presumably with a tion [cannot] prevent the periods of finan- mary, “would have the responsibility and straight face, “is about structure and re- cial market stress that seem to occur every authority to gather appropriate informa- sponsibilities — not the regulations that five to ten years.” But then, solving market tion, disclose information, collaborate each [new] entity would write.” woes is not the point; establishing greater with other regulators on rule-writing, and Secretary Paulson went on to describe control is the real objective. take corrective actions when necessary to a brave new world where a new Federal Interestingly, Secretary Paulson also ensure financial market stability.” This of Reserve writ large will “collect informa- indicated that the planning for this new THE NEW AMERICAN • APRIL 28, 2008 23
  • 24. ECONOMY ECONOMY blueprint has been in the works since at Don’t spend Money; least March of 2007, well before the fi- nancial crisis broke. The blueprint was, according to the Treasury Department’s Save It Fact Sheet, the product of unnamed “industry leaders and policymakers” planning to overhaul our “outdated fi- nancial regulatory network.” And with the ongoing financial turmoil, “market conditions today provide a pertinent backdrop for this study’s release,” the The Bush administration wants us to spend our way out Fact Sheet wryly notes. of recession, but that won’t benefit the national economy Brave New Financial Socialism any more than it would improve our household budget. Thus we have been treated, over the past few months, to a series of well-planned, possibly coordinated events preparing the way for a radical new foray into financial socialism. After a series of Federal Reserve actions designed to set new precedents for how and with whom the Fed does business, the Treasury De- partment announced a grand scheme that proposes to make permanent all of the new expansions of Fed authority, and a whole lot more besides. As if on cue, liberal members of Congress, like Senator Charles Schumer, have already criticized the Treasury’s new plan as not going far enough. The legislative outcome, therefore, is likely to trans- form America’s entire financial system into a virtual arm of the government, stifling further innovation, squelching AP Images risk, and limiting growth. In the long run, the economic effect of such a revolution would be devas- Bloated budget: Federal spending has soared during George W. Bush’s presidency, and the tating: no more double-digit returns on excessive spending has fueled the credit crisis as well as the creation of money out of thin air. investments, for example, or financial privacy. Buying insurance or a mort- gage of any description would become by Llewellyn H. Rockwell, Jr. from 4.7 percent. In the old days, unem- as irksome as paying federal income ployment rates of 5 percent and 6 percent S taxes. Asset growth of all kinds would omehow it always comes down to were considered “full employment” in the stagnate as the risk-free environment economics. In good times, the poli- Keynesian economic models — socialist- of total financial socialism, long envis- ticians play and play, and everyone inspired economics that call for govern- aged by America’s elites, slowly but figures that there is nothing that could go ment intervention in markets to “control” surely suffocated our once-vibrant, wrong. Suddenly we are all looking at the the economy. If government attempted to risk-dependent free-market system. reality of recession. Investment is falling. push employment below that level (and it Nor is the story finished. As finan- The externals are even scarier: dollar and is absurd to think that anyone in Washing- cial uncertainty continues in the weeks stocks skidding, gold and other prices ton can control the economy in that way), and months ahead, expect further inno- (particularly producer prices) rising. But it would risk setting off inflation, or so it vation on the part of Bernanke’s Fed, what tipped the psychological scales is the was believed. and further calls for more government statistic no one has cared much about in controls. Only principled, concerted, many years: unemployment. Cause and Effect well-publicized resistance will stave The actual rate is very low by any his- If the actual unemployment rate is low, off Bernanke and Paulson’s financial torical standard: 5 percent. What matters what is behind this wave of pessimism? dystopia. n here is the direction of change. It jumped All data in the postwar period of American 24 THE NEW AMERICAN • APRIL 28, 2008
  • 25. economic history consistently show that an What, then, is the solu- increase in the rate has coincided with the tion to unemployment? As onset of recession. However, keep in mind Ludwig von Mises wrote in Economic expansion is based not on that the link between rising unemployment 1931, “The determination spending but on capital expansion and recession is largely true by definition of wage rates must become rooted in savings. the only path to future only. In other words, those charged with free once again. The forma- defining what is and what isn’t a recession tion of wage rates should prosperity is delaying current consumption put a huge weight on rising unemploy- be hampered neither by the in favor of future investment. ment. So, of course, it appears that weak clubs of striking pickets nor labor markets are what push an economy by government’s apparatus into recession. of force. Only if the determination of wage widespread errors in the investment sector. This is sheer fallacy, and a particularly rates is free, will they be able to fulfill their These investments are unsustainable over dangerous one. Rising unemployment is a function of bringing demand and supply the long term. The recession is the time symptom of a recession, not its cause — into balance on the labor market.” of cleansing out errors and reestablishing just as rising prices are a symptom but not There is an error even more fundamen- economic soundness. a cause of inflation. If the critical problem tal than seeking an interventionist solution The housing boom and bust here is of recession is unemployment, policymak- to the problem of unemployment. It is the only a symptom of a wider problem. If the ers are tempted to address this one area to attempt to seek a solution to the recession economy has indeed fallen into recession, the exclusion of everything else. itself, as if it were the critical problem. we can know with certainty that recession Everyone in Washington is talking about Writing all throughout the 1930s, both is precisely what the economy needs the a “fiscal stimulus” to counter this trend. Mises and F.A. Hayek tried to explain that most. It is the equivalent of the drunk who Perhaps if Bush and Congress had been the recession itself served a market pur- needs time on the wagon. famed penny pinchers, you could see how pose, in the same way a correction to an The rap on the Austrian School of eco- a stimulus would make some sense on the inflated stock market serves a purpose. nomics, which espouses that government surface in any case. But it is hard to imagine It is working to re-coordinate economic intervention into markets always has nega- a more fiscally profligate regime than the structures that have grown seriously out tive consequences, is that they counseled a Bush administration. of balance. do-nothing policy on the Depression dur- The view that unemployment was caus- In other words, they urged that we look ing the 1930s. That is not true. There are ing recession was one of the great errors back before the recession, to the good old many things that government can do but of the New Deal and the Great Depression. days of economic boom, and realize the they all amount to doing less, which is a The government looted the private sector prosperity of the past was a partial illusion. positive action of sorts. It must not attempt and transferred it to visible jobs programs. The recession is the way that the economy to prop up and raise wages. It must stop It forced business to maintain high wages tells the truth about the fundamentals. The taxing business so heavily and raising the precisely when the market was attempt- illusion itself is caused by errors in mon- costs of investment. It must cut regulations ing to equilibrate them downward. Firms etary policy. Interest rates are driven down that are hampering recovery. It can cut were pressured, unions enabled, and cut- by policymakers at the Fed, and this causes spending dramatically as a way of return- ting wages could even be illegal under the fascist-inspired National Recovery Administration of FDR. It increased the costs of hiring just when the costs needed to be lower. Writing in 1931, in his book Causes of the Economic Crisis, Ludwig von Mises explained that there would be no involuntary un- employment in a free market. There will always be some unemployment in a market in the same way that there are houses that are empty and not selling and resources that are not being used for production. This isn’t due to market failure but to in- dividuals who have the freedom to lower their asking price, provided they are permitted by policy to do so and businesses are free to negoti- ate wages freely. THE NEW AMERICAN • APRIL 28, 2008 25
  • 26. ECONOMY That is to say, the only path blame umbrellas for floods, and in the to future prosperity is delay- same way, we shouldn’t blame tightfisted A pullback in consumer spending does not ing current consumption in consumers for recessions. cause the economy to fall into recession favor of future investment. There is no question that this is what is happening. What is critical is to keep any more than more spending can save it Household Budget cause and effect in mind. The pullback on from recession. the downturn cannot be One only needs to think of spending is not going to cause a recession. avoided. We don’t blame umbrellas for the household budget here If we think about the long term, this is not to see the point. If you are a dangerous trend but a hopeful one. The floods, and we shouldn’t blame tightfisted planning for the future for more people pull back and save, the more consumers for recessions. your family, what is the wis- the foundation is laid for a recovery after est course? Does one go into the current correction takes its course. debt as much as possible, buy To see that requires that we take a long ing resources to the private sector where the largest house and the biggest car, throw view. Government, however, seems inca- they can do some good. lavish parties, and hand out all existing liq- pable of seeing the long term, much less What government cannot do without uid funds to friends and strangers? Based doing the right thing to prepare for it. causing ever more problems is take posi- on the view that consumption is the way Making matters worse, this is that dread- tive action against symptoms, such as fall- to avoid economic problems, this would ed event called an election year. Prettying ing stocks prices, rising unemployment, indeed be the right course. things up to make the economy palatable business failures, and falling incomes. But this also defies everything we know to voters is priority number one. This is precisely what caused the Great about family finance. The path to a secure What does this mean? More monetary Depression to get its name instead of being prosperity is delaying consumption. One expansion. More government spending. called what it might have been called: the should spend as little as possible and save The Bush administration is resorting to recession of 1929-1931. as much as possible for the future, and let sending checks out to every American There is another perennial target as that money be used in the service of in- family with the proviso that the money has well: tightfisted consumers. After 9/11, vestments that yield a solid rate of return. to be spent, not saved. Bush told everyone to go out and spend Those who have chosen a different path No doubt many people are thrilled by money so the economy could avoid reces- now see the folly: they are being burned in this. But look beneath the surface. Govern- sion. Even then, there was a confusion the soft housing market, for example. ment has no money to spend on anything about whether he was right or wrong. The lesson is also true for the nation at that it doesn’t extract from the pocket of Some sensible voices pointed out that eco- large, because the logic doesn’t magically you and me and the whole American pub- nomic expansion is based not on spending change when moving from the family lic. This is easy enough to see concerning but on capital expansion rooted in savings. budget to the national stage. Just because taxes. It is not so easy to see when the gov- something involves ernment runs up debt that is guaranteed by “macroeconomics” the printing presses. doesn’t mean that we The monetary issue can be understood Rocket science? should throw out all by an analogy to orange juice. The more Hardly! To turn around good sense. water you add, the less substance it has. our economy, we In a recession or If you keep adding, eventually you come must insist that our a crisis, the right ap- to the point in which you can no longer governmental officials proach for individuals tell that it was ever orange juice. This is heed the same lessons is to save. So too for the same with money. If you print enough about spending and the national economy. — literally or electronically through the savings we teach our A looming recession credit markets — it will continue to lose children. will prompt a pullback value. If money grew on trees, it would be in consumer spending about as valuable as fall leaves. as a rational response Yes, government can increase consump- to the perception of tion, but by doing so, it does nothing to economic troubles. care for the long term. The long-term This action does not health of a nation is not different from that cause the economy to of a household budget. Tough times require fall into recession any cutbacks and a beefing up of savings. more than more spend- So let’s not demonize the consumer ing can save it from re- public for doing what it should be doing. cession. The downturn It’s a good rule of thumb that when the is a fact that cannot government tells you to spend money, be avoided. We don’t think again. n 26 THE NEW AMERICAN • APRIL 28, 2008
  • 27. INTERVIEW Defending Gun Ownership The New American Larry Pratt, executive director of Gun Owners of America, answers questions about the Second Amendment, thing that you find in the 1st, 2nd, 4th, concealed-carry laws, and how best to argue for gun rights. 9th, and 10th Amendments at least. When- ever the Constitution uses the term “peo- Interview of Larry Pratt Pratt: I think we stand apart for perhaps ple,” in the Bill of Rights, that’s actually a by John F. McManus two reasons in particular. reference to individuals. 1) We do think that gun control really Also, in what was otherwise not a par- L arry Pratt is executive director of needs to be taken off the books. We don’t ticularly good decision that came down in Gun Owners of America, a no- think it’s constitutional to make somebody the 19th century, the court ruled in Cruik- compromise pro-gun lobbying or- prove his innocence before he exercises a shank that rights do not originate from ganization that supports the rights of gun right. the government having established them, owners guaranteed by the Second Amend- 2) Beyond that, we think that politics but that rights — such as the right to be ment. He also hosts GAO’s weekly radio is inherently confrontational. Confron- armed as stated in the Second Amendment program Live Fire. tational politics means you may or may — predated the existence of the American not wish to participate, but you’re going Republic and its Constitution. All the Con- The New AmericAN: What’s the main to lose if you don’t, and you’d better get stitution is doing is observing their reality goal of your organization? organized. and endeavoring to protect rights, because Larry Pratt: Gun Owners of America is that’s the way God made us. organized to lobby Congress to focus on TNA: There are some who say firearms pro-Second Amendment legislation and ownership is a collective right. Other peo- TNA: Some argue against the right to actually to try and get what’s been put on ple often say that they have their Second keep a concealed weapon. Comment? the books taken off, as the federal govern- Amendment rights, and refer to the term Pratt: One of the things that we should ment has no authority regulating guns. “people” in that amendment. Isn’t it a point out is that every time that concealed God-given right protected by the Second carry is introduced in a state or is being TNA: How do you differ from other groups Amendment? considered for loosening up the laws to that are also doing this? Pratt: The term “people” is some- make it easier for people to carry in more places, we hear an argument or we’re always warned with alarmist rhetoric that guns and people, guns and students, guns and schools, guns and churches, guns and whatever — fill in the blank — are so dangerous and this is going to lead to road rage, turning these places red with blood flowing from irresponsi- ble activity. It never happens. In fact, what we find is that people who have concealed carry permits are the ones who commit the fewest crimes of any in the population — and this in- cludes police and ministers, for Larry John F. pratt that matter. We should be en- The New American McManus couraging them to be carrying in churches so that they can re- 27
  • 28. INTERVIEW Saving lives: if it weren’t for an armed member of the New Life Church’s security detail, dozens, if not more, of innocent people could have perished. the ability to confront their accuser, the ability to have their attorney protect their rights throughout that whole process, and so forth. For veterans, that’s just been given up. This is something that has the poten- tial to be broadened to people who have other diagnoses allegedly that would make them a possible danger to self and to others. TNA: Do you have any numbers of the AP Images military that are being affected by this? Pratt: At present, 140,000 veterans have been disarmed and it’s increasing at the ple failing to understand the effectiveness rate of 1,000 per month. The debate, as the spond the way the volunteer security detail of individual gun ownership and individu- former deputy assistant secretary for pol- of the church members in the New Life als carrying guns in reducing crime stems icy of the Veterans Administration Mike Church in Colorado Springs was able to from the media, which filters out success- McClendon told us, is whether or not all respond and stop a killer, literally dead in ful defensive gun uses. veterans should be classified as having his tracks, before he was able to kill what, I debated a man one time on television post traumatic stress disorder. So this is if we judged by the ammunition he was who said, “What you’re talking about and potentially huge. carrying, would have been hundreds of what John Lott talks about with all the people. studies he’s done means that more guns TNA: In the wake of disasters, terrorist We have been working to encourage means less crime. Why we’ve just never attacks, etc., are you fearful of how the au- legislatures to back off of these “no-gun seen anything like that in the media so it thorities will react, of how they will treat zones” because they are simply “criminal can’t be true.” He actually said that. us in that instance? safe zones.” Pratt: Disasters and emergencies are his- TNA: Are there any bad laws currently on torically opportunities for government to TNA: When one analyzes who gets shot the books that you are worried about? aggrandize and grab power, usurp power, Pratt: We just lost a battle over substitut- to death, often criminals kill other crimi- nals, and large numbers of criminals are ing a psychiatrist’s diagnosis for due killed each year by gun-wielding intendedprocess in a court of law. This specifi- AP Images cally has hammered veterans. Their crime victims and so forth. It’s fairly rare Disarming: Many thousands of for a responsible gun-wielding citizen todiagnoses [of post-traumatic stress veterans are returning home, only to be disorder and other disorders] trigger be killed by an attacker or to shoot an in- “diagnosed” with a disorder, and then, nocent bystander. Why do so many people a loss of gun rights. Their diagnoses without due process, stripped of their have been put into computers at the have the misconception that a gun for self- right to self-defense. defense is a bad idea? Veterans’ Administration and then Pratt: The biggest single reason for peo-sent over to the FBI to be added to the Brady Instant Check List of people who [Ask somebody who is anti-gun], “Would can’t buy a gun. Hence we call it the “Veterans you be willing to put a sign on your house Disarmament Act.” that says ‘There are no guns in this house’”? Veterans should not lose their right to keep Offer to give them that sign for free. I’ve yet and bear arms because to find anybody to take the sign. of a psychiatric diag- nosis instead of a trip — Larry Pratt to court with due pro- cess. They should have 28 THE NEW AMERICAN • APRIL 28, 2008
  • 29. and get power illegitimately. After Ka- trina, the Internet made a big difference in what followed. There were at least two news clips put out on video over the Internet, and Gun Owners of America was able to capture those videos. You can see guns being con- fiscated from peaceful citizens in the af- termath of Katrina, after the rain, and even after the flood water was subsiding. What the people were doing was guard- The New American ing their properties so they wouldn’t be subject to looters coming through vacant homes. This was outrageous, to say the least. Thanks to Louisiana Senator David Vitter and Representative, now Governor, Bobby Jindal, it’s now illegal for any fed- find anybody to take the sign. actually don’t believe in self-defense. eral law-enforcement agent to grab some- We’ve made these as bumper stickers, When I’ve debated them and I have body’s gun during one of these circum- and I still have the original stack that we enough time — more than the five-minute stances from a peaceful citizen. had printed up, other than those I gave segment that they might do on Fox News They will be open to being sued per- out to a few people who thought it was — I’ve gotten to where I ask anti-gunners, sonally. If any of them confiscates a gun funny. “So you don’t really believe in self-defense from a peaceful citizen, they are opening The other thing you’ll face is someone do you?” And they refuse to answer. themselves up to a devastating lawsuit that who is sort of agnostic about the debate could take everything they own. who says, “I agree that the Second Amend- TNA: Roughly what percentage of U.S. ment means what it says, that individuals citizens owns firearms? TNA: With somebody who is anti-gun, are protected in their individual right to Pratt: Happily we don’t know how many what’s the single best argument to use? keep and bear arms, but I don’t feel like I Americans own guns because guns are Pratt: Well, one way to argue is to say, need a gun right now.” Respond to them, not registered in any central fashion. Al- “Oh, so you believe guns are really bad? “Oh good, so you don’t have homeown- though every time we buy a gun at the That being the case, would you be will- ers insurance either, right?” That usually store, it is registered. But then in most ing to put a sign on your house that says makes the point. states the gun can be transferred legally ‘There are no guns in this house’”? Offer You hope your house is never going to to somebody else without any paperwork to give them that sign for free. I’ve yet to burn down, but you still buy the insurance. whatsoever. You hope you are never going to use your Probably at least half of the households gun, but it’s there if you need it. have firearms in them, and probably one of the best measures that America is still a TNA: The Million Mom March came and rather well-armed society is that home in- went, but it was many times smaller in size vasions in the United States involve, about than they billed it to be, with participants 13 percent of the time, one that is occu- perhaps in the thousands. Could that sen- pied. In Britain it’s about 65 percent. The timent easily be whipped up again? criminals in the United States are obvious- Pratt: The Million Mom March was an ly afraid of being shot by a homeowner, embarrassment to the anti-gunners. I don’t and in disarmed Britain, they are not. know that they will ever try that again. It represented nobody at the time; it certainly TNA: Any final comments? doesn’t represent anybody today. Pratt: In probably 97 percent of the defen- The anti-gunner has a real problem. He sive gun uses in America, which probably has no constituency. happen some two million times a year, no- If it weren’t for George Soros and his body fires a shot, nobody’s killed, and no- money financing a lot of the anti-gun folks, body’s wounded. Americans are extremely if it weren’t for the media which make it responsible. n look as if the anti-gunners still have some kind of strength, it would be evident to the Longer versions of this interview, in both print and whole world that these people speak for a video formats, are available online at thenewameri- very small number of people — those who can.com and YouTube.com / TheJohnBirchSociety. THE NEW AMERICAN • APRIL 28, 2008 29
  • 30. BOOK REVIEW Creating Corruption Once the cradle of liberty, Massachusetts now has become a cesspool of political corruption, with spillover infecting the entire nation. quite different styles. They system can be repaired and function well, give much insight into how particularly for the poor and working the culture and politics of class, if only we had more honest, effi- an entire state can be thor- cient, and less-selfish government leaders. oughly co-opted to evil One senses his profound disappointment purposes, and the outsized with his fellow liberals, as he sincerely effect that it has had on the believes that a command economy with nation. Keller, a longtime high taxes for the rich and heavy regula- Boston political commenta- tion of business could and should work, tor and avowed liberal, does and that it would ameliorate poverty and an honest job at shining the suffering if only the right people were light on the failings of his running the government. Thus, this book fellow liberals, but vainly is useful and instructive to persons on all thinks that socialism could sides of the debate. still work, if only the right The term “Kennedy country,” which is people were at the helm. a recurring metaphor in the book, came Howie Carr, a Boston from a remark made in a political debate radio and newspaper fix- between Senator Edward M. Kennedy ture, has no such illusions (D-Mass.) and Mitt Romney in the 1994 in his biography of Billy U.S. Senate race. In the debate, Romney Bulger, a quintessential recounted a campaign trip to a depressed Boston Irish politician, and section of Boston, during which he was his brother James “Whitey” accosted by a Ted Kennedy supporter re- Bulger, who ran the mob in minding him, “This is Kennedy country.” Boston with the complete Romney then looked around, saw boarded cooperation of corrupt FBI up buildings, saw jobs leaving, and said, by Gregory A. Hession, J.D. agents. Carr exposes political chicanery “It looks like it.” The mostly Democratic with a mordant style and with bemused crowd gasped, unaccustomed to such an The Bluest State: How Democrats Creat- cynicism. By turns sardonic and serious, attack on their icon. ed the Massachusetts Blueprint for Amer- he chronicles the rise of “legit” brother Keller’s premise in the book is that the ican Political Disaster, by Jon Keller, New Billy Bulger, who headed the Massachu- high-minded talk by liberals about helping York: St. Martin’s Press, 2007, 258 pages, setts State Senate for 30 years, and the out- the poor and creating a good responsive hardcover, $24.95. law brother, Whitey, who currently occu- government has been betrayed by a “poli- pies the spot right under Osama bin Laden tics of narcissism and self-delusion.” The Brothers Bulger: How They Terror- on the FBI’s most wanted list. He illustrates the failure of the welfare ized and Corrupted Boston for a Quarter state through the story of Clarabel Ven- Century, by Howie Carr, New York: War- Kennedy Country tura, a drug addict arrested for injuring ner Books, 2006, 342 pages, hardcover, In The Bluest State, Jon Keller concen- her four-year-old son. She was one of 14 $25.95. trates a critical eye mainly on how seldom children of a Puerto Rican immigrant all Massachusetts’ liberals actually follow living on welfare, with 74 grandchildren T hese two books, The Bluest State, through at fulfilling promises to help the and 15 great-grandchildren all on the state by Jon Keller, and The Brothers poor and how the policies they implement dole. At the time, this family cost Mas- Bulger, by Howie Carr, show how exacerbate government corruption, pover- sachusetts over a million dollars a year. Massachusetts, once a state at the center ty, and inequality. Keller, a self-described When interviewed about whether the tax- of the birth of American freedom, now liberal and a supporter of same-sex “mar- payers should continue to be burdened by breeds toxic politics and politicians that riage” and abortion, nonetheless turns an her family, one of Clarabel’s sisters said, corrupt the nation. unflinching spotlight on Massachusetts’ “Just tell them to keep paying.” Both of these books are entertaining liberalism and assesses its failures real- Keller laments that Massachusetts has reading, and both are expertly written in istically. However, he believes that the become “a place where the poor lack 30 THE NEW AMERICAN • APRIL 28, 2008
  • 31. hope and live in Appalachia-like squalor, As for helping women get where even middle class workers with equal treatment with men, salaries well above the national median JFK, his brothers, and their In The Bluest State, Jon keller struggle to afford inferior housing, hold progeny advance a type of concentrates a critical eye mainly on how jobs that barely subsidize survival, and feminism that Keller calls seldom Massachusetts’ liberals actually wait in vain for meaningful help from the fake, unless “serial infidel- government.” ity and exploitation are now follow through at fulfilling promises Keller identifies Senator John Kerry feminist traits.” They pretend to help the poor and how the policies as one of the politicians who have failed to care about women, while to uphold the dream in Kennedy country. using and destroying them. they implement exacerbate government Keller observes, somewhat sarcastically, One “successful” student corruption, poverty, and inequality. that Kerry and his contemporaries “all of that Massachusetts-style ducked out on local obligations to bring feminism was William Jeffer- their priceless gifts to the nation.” For ex- son Clinton. such intolerable conditions? How does ample, Senator Kerry has voted to increase At the 2004 Democratic Party Con- that happen in Kennedy country?” taxes 98 times, and voted against reduc- vention, Senator Kennedy enumerated Read this book, and you will know. ing taxes 127 times, primarily on the poor the usual litany of identity politics-based and middle class. Senator Kennedy has “rights” that Democrats have fought for Taking Advantage of Opportunity exceeded even that heroic total. on behalf of the poor, the handicapped, The focus of Howie Carr’s book, The Another example of Massachusetts women, and children. Keller brilliantly Brothers Bulger, is less about failed poli- bringing “its priceless gifts to the nation” calls this endless victimizing “a totality of cies and promises than it is about how is its recent Supreme Judicial Court ruling oppressions.” In Kennedy country, every- crime and corrupt politics that are toler- ordering the legislature and the executive one is a victim, and everything in America ated by the law can wreak havoc both lo- branch to recognize same-sex “marriage,” is horrible. cally and nationally. The book shows how in violation of separation-of-powers prin- But the compassion is only ankle deep. the Bulger brothers, ostensibly on oppo- ciples. Although Keller does not find “gay One street-savvy black minister who has site sides of the law, were actually both marriage” objectionable, he properly de- tried for years to interest the “liberal outlaws who enjoyed legal protection of nounces reliance on court fiat for change, caring” crowd to help with projects to their perfidy at the highest levels. rather than developing grass-roots sup- reduce crime and poverty in inner-city In 1961, Billy Bulger arrived in the port for it. He decries the elite politicians’ Boston cynically calls them “elites bereft Massachusetts State House and quickly “overweening confidence in their own of relevance.” He complained that “the learned how to control the levers of graft correctness, and a willingness to use the moral and intellectual hypocrisy of the in the grand tradition of former Boston courts to obtain what they could not get Massachusetts liberal is that on the one Mayor James Michael Curley, who was by legislation.” hand, you want to say you are friend to “How much agony would the nation the black and poor, but you don’t want have been spared,” he opines, if abortion to be held responsible for the terrible had not been legalized by judicial order. conditions. And more disturbing than the True enough. However, his acceptance of actual conditions themselves is their re- James that barbaric practice, and of same-sex fusal to ask the question: how is it their “Whitey” “marriage,” taints this otherwise excel- left-liberal ideology permits or tolerates Bulger lent book. Billy Bulger AP Images AP Images
  • 32. BOOK REVIEW for a large skyscraper project The Brothers Bulger is populated by was being negotiated, the de- colorful characters, like Vinny “The Ani- Howie Carr’s book, The Brothers Bulger, veloper had to pay $1.8 mil- mal” Ferrara, Steve “The Rifleman” Flem- is about how crime and corrupt politics lion to Billy’s law-firm part- mi, and his brother, Vincent “Jimmy The ner for “monitoring the sale at Bear” Flemmi. With monikers like that, that are tolerated by the law can wreak City Hall.” Billy, of course, got one can surmise their occupations without havoc. It shows how the Bulger brothers, his generous cut. difficulty. Though Billy Bulger still claims ostensibly on opposite sides of the law, Much of Billy’s power that he had no knowledge about Whitey’s rested on giving taxpayer- criminal activities, the headquarters of the were actually both outlaws who enjoyed supported jobs to his cronies. South Boston Irish mob was in a house 15 legal protection at the highest levels. Whenever a job became avail- feet away from Billy’s own house. It was able, a traditional “nationwide in that headquarters that Whitey and his search” would be done, and henchman Steve Flemmi strangled one of once elected mayor from jail. He ingrati- surprisingly, the Bulger coat holder was Flemmi’s girlfriends when she wanted to ated himself with the power brokers and always the one who got the job. leave Flemmi for another man, and also eliminated competition, so he was able Here is part of a description of what it killed her daughter, whom Flemmi was to control the favors. Billy also benefited meant to have a government “job” in Bul- “dating.” from some fabulously lucky timing, as ger’s Boston, as Carr describes a 1990 raid Whitey was not the noble or sympathet- several potential rivals retired or were by the police on some of Whitey Bulger’s ic gangster portrayed by some Hollywood caught in scandal, leaving him, over time, drug dealers: filmmakers; he was a beastly, stone-cold the undisputed political boss. killer. He and his thugs personally killed Carr lays out the credo for doing busi- After midnight, the cops grabbed scores of persons, ranging from small-time ness in Massachusetts during the Bulger Thomas “T.K.” Cahill. He was sleep- hoods to girlfriends. He would strangle or era: 1) Nothing on the level; 2) Everything ing through his overnight shift at the shoot them, often after torture. Then, he is a deal; 3) No deal too small. Billy cor- city Department of Public Works pulled their teeth out with pliers and cut off rupted everything he touched. yard on Frontage Road, and had been their fingers and tongues so they couldn’t Senator Bulger essentially ran the legis- expected to report for work the next be identified, and buried them in death pits, lature like a mob racket, with bribes, pay- morning at his other public sector job or even in his basement. offs, no-show jobs, and endless looting of at the Massachusetts Water Resourc- In the 1990s, after Billy Bulger’s long the public till. For example, the Metropoli- es Authority, where the personnel di- stint as State Senate president, he recog- tan Boston Transit Authority really became rector was the wife of a state senator nized that his power was waning, and he Mister Bulger’s Transit Authority because loyal to Billy. angled for a soft landing as president of he stashed so many cronies and relatives the five-campus University of Massachu- there. The rule was pay or no play. When At his peak, no one could challenge Bil- setts system, at a modest annual salary of the sale of a parcel of Boston-owned land ly’s power. He had a saying for those who $359,000, more than twice that of the gov- tried: “Reformers won’t be back.” And ernor. Once ensconced, he immediately they usually weren’t. created a hackorama in his new domain, Carr provides fascinating details on splurging for fabulous high-rent Boston how brother Whitey Bulger and his mob offices and padding the payroll with hun- pals corrupted the FBI to the highest lev- dreds of new, high-paid sycophants and els. In its obsession to get the Italian mob, yes-men. the bureau set up Whitey as an informant Meanwhile, Whitey had left town when and let him kill and run drugs for decades, the FBI couldn’t protect him from exposure with full knowledge and sometimes even anymore. He had deliberately traveled the participation by FBI agents. In exchange world for several years, setting up aliases for providing evidence on his Mafia and safe deposit boxes to prepare for that rivals in Boston, Whitey was always eventuality. Then one day he just left — tipped off by the FBI when heat came but not before winning a large payout in down from another law-enforcement the Massachusetts lottery under more than source that hadn’t been bought. The somewhat clouded circumstances. feds systematically and unwittingly Billy was ousted as UMass president eliminated his only competition, in 2003 by then-Governor Mitt Romney. La Cosa Nostra. That left him the On his way out, though, just like Whitey, undisputed king of the Boston he snagged a big bag of loot, including an underworld. By the end of the $11,300-per-month pension. ’80s, the Boston Globe estimated Who says crime and politics don’t Whitey was worth $50 million. pay? n 32 THE NEW AMERICAN • APRIL 28, 2008
  • 33. THE GOODNESS OF AMERICA Florida Mom Stops Shooter Zoller saw the slain teacher’s two- loved butterflies since she saw one at her On the afternoon of January 25, Louise year-old daughter Allyson, whom the grandmother’s funeral, the workers redeco- Zoller, along with her 11-year-old daugh- other children in the class called “Baby rated her bedroom with a butterfly motif. ter, Morgan, arrived at Bobbie Noonan’s Allyson,” cradled in the arms of another In recognition for the generous work Child Care in Cape Coral, Florida, to pick teacher and became sad. The girl is now that McClurg and his employees did for the up her two-year-old daughter, Hannah. being raised by her grandmother, Lozier- Luchsinger family, State Senator John A. As Morgan attempted to enter the secu- Dunn’s mother. DeFrancisco presented them with the New rity code, the unlocked door swung open. Zoller appeared on the ABC television York State Senate Liberty Award on Janu- Something was definitely amiss. The program The View on February 20, when ary 31. The senator noted: “Scott and his school’s director told Zoller that there was hosts Barbara Walters and Elizabeth Has- team of volunteers should be commended a man outside with a gun. Zoller and her selbeck announced that a $25,000 donation for the many nights and weekends they daughter quietly went to the classroom of was being given to the Allyson Dunn As- spent working to completely renovate the Christine Lozier-Dunn, Hannah’s teacher. sistance Fund, established in part to help Luchsinger home so Jamie can continue to When Zoller saw Hannah and the other the slain woman’s daughter go to college. live comfortably with his family.” children huddled in the classroom’s bath- On February 11 Cape Coral Mayor Eric In accepting the award, McClurg gave room stalls, she asked the teacher what Feichthaler declared “Louise Zoller Day” credit to “the entire team of volunteers who was going on. at the start of the city council meeting. generously gave their time, talents and fi- Zoller remarked about the teacher to the Zoller was also presented with the key to nancial support to help a local family most News-Press (Southwest Florida), “She was the city. Like most heroes, the woman was of us didn’t even know.” McClurg added, so calm.” “She just said, ‘Oh, there’s a guy humble and dismissed her actions, stating “I’d be happy to talk to anyone who would outside.’ Looking back, I think she knew simply: “I’m not a hero. I’m just a mom.” want to do the same for another family. it was him. But she didn’t let me know This is why we live in Central New York anything was wrong. And I think she was — we’re surrounded by good people.” really being calm for the kids.” Contractor Helps Family “Him” was Robert H. Dunn, Lozier- The Luchsinger family of Onondaga Hill, Dunn’s estranged husband, and he sud- New York, had undergone some severe tri- Alert Waiter Saves Woman denly appeared in the room, carrying a als. First their dairy farm was destroyed Colt Haugen was working his shift as a camouflage green gun that Zoller did not by fire, and then the father of the family, waiter at a Colorado Springs Ruby Tues- even think was real, because it looked like Jamie Luchsinger, was diagnosed with day restaurant on January 3, when he plastic. ALS, a usually fatal disease characterized observed a man dropping a pill into the When the gunman uttered an expletive by a wasting away of the muscles, popu- drink of his female companion, who had (apparently asking about his estranged larly called Lou Gehrig’s disease. momentarily left the table. wife’s whereabouts), Zoller tried to get The Luchsinger family contacted local Fox News 31, KDVR, in Denver reported him to look outside, but he instead en- contractor Scott McClurg of nearby Marcel- that when the woman returned, Haugen very tered the lavatories where the teacher and lus to get an estimate on putting in a handi- calmly took her drink away and brought her children were hiding. She heard a gunshot cap-access bathroom. But, as McClurg told a new one. He also called police. come from the lavatories, but thought it the Camillus Advocate & Solvay-Geddes The Colorado Springs Gazette reported was a blank. But when she heard the chil- Express (Onondaga County, New York): that, after a police investigation, the wom- dren screaming she became very angry. As “Once inside, I realized [the house] needed an’s dining companion, Robert Lawrence she told the story to the News-Press: “I just a lot more. I went back and asked some of Psaty, an employee of the state mental said, ‘Stop it.’ I said, ‘You’re scaring the my employees if they could volunteer some health hospital in Pueblo, who is a former children. Just stop.’” time to this project, and not one of them Florence City Council member, was ar- Dunn knocked Zoller to the ground, and said no. They couldn’t wait to help.” rested on February 20. A test performed she expected him to strike her. But when The team of volunteers led by McClurg on the woman’s drink determined that it Morgan screamed “Mommy!” she real- worked on the Luchsinger home for three had contained Diazepam, a mild tranquil- ized she must act quickly and wrestled the weeks. Some of them put in over 100 izer prescribed to reduce anxiety and relax man to the floor. Zoller knocked the gun hours on the project. As work progressed muscles. away from the deranged man and managed around the clock during that time, the Psaty, who had met the woman through to recover it and flee the building with the men installed two new bathrooms, a new a dating service, had two felony charges children. kitchen, flooring, a new electrical system, filed against him: assault by drugging a Zoller then noticed blood on the chil- sheetrock, insulation, windows, and light- victim and attempting to have someone dren’s clothing. Lozier-Dunn was dead. ing fixtures. Moving outside, they even did induce a controlled substance by fraudu- The police entered the building and ar- landscaping and put in a new driveway. lent means. n rested Dunn. Because young Erica Luchsinger has — wArreN mASS THE NEW AMERICAN • APRIL 28, 2008 33
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  • 35. HISTORY— PAST AND PERSPECTIVE Cuba Under Fidel and Raul The island nation has suffered greatly under the Castros, and though Fidel has stepped down, his tragic legacy remains, with brother Raul still at the helm. by John F. McManus O n February 19, Cuba’s radio and television stations announced that ailing 81-year-old Fidel Castro had stepped aside as the nation’s leader. Their messages noted that the Cuban par- liament speedily named his 76-year-old brother Raul as president. Accepting the office on February 24, Raul Castro stated, “I assume this responsibility knowing that as far as the commander in chief is con- cerned, there is only one. Fidel is Fidel. All of us know he is irreplaceable.” That was Raul’s way of indicating there will be no marked deviation from 49 years of communist tyranny in the island nation only 90 miles from the tip of Florida. That is not good news for the Cuban people, who have endured Fidel’s rule for the past five decades. Prior to that, in the late 1950s, Cuba was such a thriving bas- tion of free enterprise that its government had to curtail immigration of Europeans anxious to partake of freedom. A bur- Image versus reality: Fidel Castro, shown here with his brother Raul (left) prior to AP Images geoning economy made it an investor’s coming to power in Cuba, was portrayed by the New York Times and other influential dream, and the nation actually possessed American media organs as a freedom fighter. the truth was otherwise. the highest standard of living in all of the Western Hemisphere except for the United United States. Fidel even pleaded with to Angola and Ethiopia to protect commu- States and Canada. Fidel, Raul, and their Nikita Khrushchev to launch the deadly nist governments in those nations. comrades took control in January 1959, weapons at U.S. cities, but even Khrush- Anyone who cares to learn the brutal imposed iron-clad communist rule, and chev wasn’t that bold. The Cuban people truth about Castro’s supposed paradise can proceeded to execute opponents. Tens of have had no free elections in 50 years. Ap- find it in Against All Hope: A Memoir of thousands perished by firing squads, more proximately 20 percent of the population Life in Castro’s Gulag by Armando Val- died in prison camps, and no one knows fled to the United States. Cuban troops, ladares. After spending 22 years in Cuba’s how many more perished at sea fleeing armed by the USSR, not only served to dungeons, Valladares was freed, went to Cuban tyranny. keep Fidel in power, they functioned in the live in Spain, told his story and the plight of Cuba quickly became an open Soviet service of international communism when his oppressed countrymen, and earned the satellite aiming nuclear missiles at the large numbers of Cuban troops were sent label “Cuban Solzhenitsyn.” His book is as THE NEW AMERICAN • APRIL 28, 2008 35
  • 36. HISTORY— PAST AND PERSPECTIVE revealing about Cuba’s communist tyranny imentation; Diosdado Aquit, Chino Cubans were trying to flee, Hollywood’s as Solzhenitsyn’s The Gulag Archipelago is Tan, Eddy Molina, and so many oth- leftists continued to shower Castro with about the USSR’s merciless despotism. ers murdered in forced-labor fields, adulation. Oliver Stone described him Valadares had won release after his quarries and camps. A legion of spec- as “selfless and moral.” Harry Belafonte decades of deprivations when the French ters, naked, crippled, hobbling and claimed: “If you believe in freedom … jus- government intervened on his behalf. As crawling through my mind, and the tice … democracy, you have no choice but he ended his book, he recounted only some hundreds of men wounded and muti- to support Fidel Castro.” Jack Nicholson of the many atrocities he had witnessed: lated in the horrifying searches. called him “a genius.” Gina Lollobrigida said he “is warm and understanding and I recalled the two sergeants, Porfiirio Less than a year after reluctantly freeing seems extremely humane.” Francis Ford and Matanzas, plunging their bayo- Valladares, Fidel Castro was interviewed Coppola thought so highly of the Cuban nets into Ernesto Diaz Madruga’s in Havana by American and French jour- dictator that he slobbered, “Fidel, I love body; Roberto Lopez Chavez dying nalists. As a fitting Epilogue, the man who you.” And Chevy Chase chimed in with, in a cell, calling for water; Boitel, de- had survived treatment no human should “Socialism works. I think Cuba might nied water too, because Castro want- ever have to endure published what Fidel prove that.” These are only some of the ed him dead; Clara, Boitel’s poor told the assembled foreigners on July 28, outrageous statements published by ac- mother, beaten by Lieutenant Abad in 1983: “From our point of view, we have no claimed author Humberto Fontova in his a Political Police station because she human-rights problem — there have been book, Fidel: Hollywood’s Favorite Tyrant. wanted to find out where her son was no ‘disappeareds’ here, there have been no Other Castro lovers include Robert Red- buried. I remembered Carrion, shot in tortures here, there have been no murders ford, Vanessa Redgrave, Danny Glover, the leg, telling Jaguey not to shoot, here. In twenty-five years of revolution, and Norman Mailer. and Jaguey mercilessly, heartlessly, in spite of the difficulties and dangers we Left-leaners in politics and the mass shooting him in the back; the officers have passed through, torture has never media were hardly outdone in their gush- who threatened family members if been committed, a crime has never been ing over Fidel. Dan Rather called him they cried at a funeral. I remembered committed.” Telling lies is consistent with “Cuba’s own Elvis.” Fontova compiled a Estebita and Piri dying in blackout creating tyranny. long list of plaudits for the bearded Cuban cells, the victims of biological exper- Yet, during these years when so many leader from the likes of Jesse Jackson, Katie Couric, Ted Turner, Charlie Rangel, Maxine Waters, George McGovern, Bill Castro’s Cuba: Fidel addresses thousands the day he and his guerrilla army arrived Clinton, and others. triumphant in Havana. Half a century of communist oppression would follow. While Castro was given a pass and fre- quently idolized, Chile’s anti-communist Augusto Pinochet earned nothing but scorn from Hollywood and much of Amer- ica’s media. The Chilean leader saved his nation from an imminent communist takeover, instituted a free-market economy that quickly became envied all throughout Latin America, and even presided over promised free elections. He then stepped aside when the voters wanted someone else. Hollywood managed to produce a number of anti-Pinochet films but never any about the Castro brothers and their bloody tyranny. Nor, as one commentator noted, has Hollywood ever seen fit to pro- vide moviegoers with the ugly truth about Lenin, Stalin, and Mao Tse-tung. The Truth Was Known In September 1958, the small-circulation American Opinion magazine headed by Robert Welch (who founded the John Birch Society three months later) pub- lished an assessment of what was hap- pening in Cuba. He wrote, “Now the evi- dence from Castro’s whole past, that he is AP Images 36 THE NEW AMERICAN • APRIL 28, 2008
  • 37. a Communist agent carrying out Commu- nist orders and plans, is overwhelming.” At the time, Castro was portrayed by the American media not as a communist but as a reformer, even as a Robin Hood. But if Welch, a private citizen, knew the truth about Castro, could it be that top officials in the U.S. government were unaware? The evidence clearly indicates that our nation’s officials not only knew the truth but aided Castro’s rise to power, our government’s ostensible anti-communist foreign policy notwithstanding. Welch added in his short September 1958 piece, “Of course, for the record, Castro says he is not a Communist, and reminds you that writers in the New York Times say he is not a Communist.... We remember how emphatically Mao Tse-ting and his good friends among the New York Times writers insisted that Mao was not Flight to freedom: these Cubans were fortunate to reach Miami by airplane on January AP Images a Communist either.” These statements by 5, 1961, two years after Castro came to powers. over the years, countless thousands Robert Welch, we emphasize, were written have fled Cuba in small boats and rafts — many of the desperate victims perishing several months before communist control before making it to Florida. descended on the island nation. Looking back, we see that key U.S. of- 22 months of their sentence, went back to State Department received repeated warn- ficials knew that Castro took time off from Mexico. Soon, Raul introduced the Argen- ings from Gardner about the communist studying law at Havana University in 1948 tine revolutionary Che Guevara to his older nature of the Castro-led uprising. For his and traveled to Bogota, Colombia, with a brother. And it was Raul who befriended effort, he was removed and even prevent- Cuban student group. While there, well- KGB agent Nikolai Sergeevich Leonov in ed from briefing his successor, Earl E.T. known Colombian political leader Jorge Mexico, thereby beginning a relationship Smith. Instead, Smith was told by State Gaitan was assassinated and Fidel was be- with Moscow that fueled the Cuban revo- Department officials Roy Rubottom and lieved by many to have collaborated with lution for several decades. William Wieland to gather information the local Communist Party in perpetrating From Mexico, the revolutionaries — about what was happening in Cuba from the crime. Immediately, much of the city now numbering 81 — executed a return Herbert Matthews, the New York Times of Bogota erupted into communist-stimu- to Cuba, landing on the coast of Oriente reporter who admired Castro and propa- lated anarchy with Castro in the thick of Province in late 1956. Senate reports years gandized on Castro’s behalf. For instance, it. During that bloody uprising, a band of later claimed they were supplied with arms in the Times for February 24, 1957, Mat- revolutionaries seized a local radio sta- by sources in Florida and by Russian sub- thews effused that Castro “has strong ideas tion and a voice was heard broadcasting, marines surfacing off the Cuban coast. of liberty, justice, social democracy.” And “This is Fidel Castro. This is a communist Attracting the worst elements of Cuban in the Times for July 16, 1959, more than revolution.” When order was restored, the society, their numbers grew steadily. Oper- six months after Castro came to power, young revolutionary hightailed it out of ating from Cuba’s eastern mountains, the Matthews claimed that Castro “is not Bogota and fled to Mexico, and was soon Castro-led forces unleashed a reign of ter- only not Communist but decidedly anti- back in Cuba. ror that included bombings in markets and Communist.” Meanwhile, Fidel’s brother Raul had anywhere else innocent civilians gathered. Smith discovered the truth prior to Cas- joined the Partido Socialista Popular, Cu- They destroyed bridges and roads, kid- tro coming to power, but his reports, like ba’s affiliate of the Soviet-backed Cuban napped U.S. citizens caught in the escalat- Gardner’s, were ignored, with the result Communist Party. On July 26, 1953, the ing struggle, and extorted protection money that Castro succeeded in taking control of brothers and a force of about 1,000 men from Americans who owned businesses in Cuba in January 1959. attacked Moncada Barracks. The attack Cuba. Soon, Raul Castro would be named In 1960, after the Castros were sol- failed and the two Castros were captured, commander of the revolutionary forces. idly entrenched in Havana, Ambassador tried, and sentenced to 15 years in prison. Smith told a Senate committee, “Without Others were also imprisoned. The suppos- Unheeded Warnings the United States, Castro would not be in edly tyrannical Cuban leader, Fulgencio Arthur Gardner, an able U.S. diplomat, power today.” He emphasized the harm Batista, later issued a general amnesty was serving as our nation’s ambassador to generated by Matthews’ articles glorify- and the two Castros, after serving only Cuba at the time. Pro-Castro leftists in the ing Castro, that they had “served to in- THE NEW AMERICAN • APRIL 28, 2008 37
  • 38. HISTORY— PAST AND PERSPECTIVE converted into a Soviet satellite. Raul oversaw the execution of soldiers who had sided with the Batista government. Gone was the Cuba that had been decidedly pro- American, a respecter of privately owned businesses and residences, and a bastion of free enterprise enjoyed by a prosperous middle class. But widespread admiration for Castro continued until 1961 when the Cuban dictator announced publicly, “I am a Marxist-Leninist.” The State Depart- ment, still infested with pro-communists, claimed with feigned sorrow that “what began as a movement for democracy and Cuba today: Raul Castro (left), shown freedom has been perverted into a mecha- here with venezuela’s Marxist leader nism for their destruction.” For his work, AP Images hugo Chavez in 2006, now holds the William Wieland won promotion to consul reins of power in Cuba. general and settled into his assignment in Australia. flate Castro to world stature and world ly recognized Castro as Cuba’s legitimate During his retirement in April 1963, recognition.” And he severely castigated leader within days of the January 1959 Dwight Eisenhower, whose administration the State Department for its work that takeover. A victorious Fidel, with Raul ever steered the Castros into power, stated dur- “helped to overthrow the Batista dicta- at his side, immediately initiated policies ing one of his infrequent press conferences torship which was pro-American only to that saw vast amounts of property confis- that only a “genius and prophet” could install the Castro dictatorship which is cated, opponents arrested and executed, a have known Castro was a communist in pro-Russian.” vibrant economy destroyed, Cuba’s people the late 1950s. He didn’t intend to send a The Eisenhower administration official- forced into poverty, and the nation itself glowing compliment to Robert Welch, but his statement surely did exactly that. With Fidel’s retirement because of age and illness, no one can be sure how Cuba will fare under Raul Castro’s leadership. He is just as much a tyrant as his older brother ever was. But the heavy subsi- dies Cuba received from the former So- viet Union are no more. Conditions in the island nation are deteriorating even more speedily, forcing Cuba to turn to other • Residential revolutionaries for assistance. Raul has al- ready stated that a communist system will • Apartments remain. There has been speculation that • Commercial he will attempt to create a Chinese-style communist rule with manufacturing abil- • Industrial ity that will challenge all the products seen in Wal-Mart. He has already reached out to Venezuelan dictator Hugo Chavez, who can be counted on to keep communism in HELP PREVENT charge in Havana. AMERICA FROM GOING In other words, Cuba will remain a despotism. But no one should forget that DOWN THE DRAIN! the tyrannical regime so close to our own nation resulted from treachery inside the U.S. government aided by the New York (818) 837-1310 Times. And its destructiveness has ben- efited greatly from Hollywood leftists and from pro-left politicians and media 453 Jessie Street personnel — all of whom ought to be repudiated. n San Fernando, CA 91340 www.neptuneplumbing.com THE NEW AMERICAN • APRIL 28, 2008
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  • 41. “... the right of the people to keep and bear Arms, shall not be infringed.” EXERCISING THE RIGHT Police Imposters When police responded, they caught Pickett didn’t seem unduly concerned Two armed men, later identified as Jorge two youths, assumed accomplices, run- after the attack. He said about the incident: Elugardo and Brian Kennedy, kicked in ning away from the scene. Police also ap- “The only problem was I run out of bul- the door to Cody Buckler’s Fountain, Col- prehended the primary robber, a 15-year- lets.” And that won’t be a problem if there orado, home at about 11:30 p.m. on Janu- old, when he went to a hospital for care, is a next attack. ary 21. They announced to 16-year-old and they caught up with a fourth subject as Jesse Robinson, who had been sleeping well. Arrested were two teens, including on the couch, that they were police offi- the primary robber, and 20-year-olds Chris- Surveillance and Security cers — though they were wearing masks topher Whittacker and Cory Clark. Police On February 3, two men robbed the Quick at the time and one of them pointed his are fairly certain the alleged accomplices Market in Racine, Wisconsin. One of the gun at the boy. The intruders’ noise woke were involved in the incident because im- robbers had a gun. On February 15, two Buckler, who quietly checked out what mediately after the robber was wounded, robbers tried again. was happening and then went back to his the youths banged on doors nearby to get Like the robbery earlier in the month, bedroom for a shotgun. aid for their wounded friend. two men entered the store, one of them When Buckler returned to the living Though police found the robber’s rifle armed. But this time the storeowner, room with his gun, he saw one of the in- at the scene of the shooting and decided Numan Pasqualine, was ready for them be- truders carrying his flat-screen TV out of not to press charges against Martin, the cause he noticed them acting suspiciously the house. Buckler shot that intruder, caus- state district attorney’s office has yet to on his surveillance system. Pasqualine told ing him to drop the TV and flee. Buckler decide whether it will charge Martin with the Journal Times, “I thought there was then spotted the other intruder coming a crime. In Delaware, a person is allowed something wrong. They had their heads up some basement stairs and shot him. to use deadly force only when he believes down, so you couldn’t see their faces.” The second intruder got away by diving his life or another’s life is in immediate Because Pasqualine was ready for trou- through a large plate-glass window. jeopardy. Since the robber shot at Mar- ble, the two robbers never even got close The intruders initially got away, but tin, Martin shouldn’t have to worry about to the cash register before Pasqualine had were caught when they sought medical criminal charges being filed against him, his own gun out. assistance at a hospital. Gazette.com re- unless the attorney general, Beau Biden, is He told the armed robber to lie down ported: “Kennedy doesn’t have a criminal as zealously anti-gun as his father, Senator on the floor, but the armed man and his record in Colorado, court records show. Joseph Biden. accomplice ran away. Elugardo has been arrested numerous times, court records show, with at least one conviction for misdemeanor assault.” Pint-sized Problem Solver Rape Interrupted Eighty-year-old North Texan James Pickett Forty-four-year-old David Fleming, a opened his door on February 9 to two young felon who had previously been convicted Not Keeping an Eye Out men. As soon as he did, the men “came of rape, robbery, assault, and burglary, In Wilmington, Delaware, liquor-store through that door, stabbing and beating,” forced his way into a Brighton, Tennes- owner Bernis Martin was not paying close Pickett told WFAA.com. The location and see, house owned by his onetime girlfriend attention to his surroundings at 10 p.m. severity of Pickett’s wounds testify to the at about 3 a.m. on February 19. His “ex” on the evening of February 13 because viciousness of the attack: he was stabbed wasn’t there. He proceeded to tie up the he wanted to hurry from his store to get in the forehead, stabbed just in front of his woman’s two daughters, ages 14 and 22, his wife “some roses for Valentine’s Day” right ear, slashed from his nose through his with the cord from an electric heater with before going to his second job, reported upper lip, suffered a gash across his nose, the intent of raping them. delawareonline. He did not see the robber and was bashed in the eye. When Fleming began to abuse the older lurking outside holding a rifle. The attackers had the upper hand from sister, the younger girl escaped from her The robber demanded money, saying, the get-go, but Pickett, a WWII veteran, bonds and ran next door to her aunt’s “Give it up, old head,” and Martin gave wasn’t going to lie down and die. Like his house to get help. Her aunt’s son, 25-year- him about $300. Then “Martin went back favorite movie icon John Wayne, Pickett old Keith Ingram, “grabbed his pistol and into his store as the gunman started backing pulled out a revolver, a minuscule gun that ran next door to help his cousin,” reported away.” When Martin looked out again, the he had slipped into his front pocket before commercialappeal.com. Ingram entered robber shot at him. Martin grabbed a pistol he answered the door, and he began shoot- the house next door and heard his cousin from his waist holster and began firing. He ing. He hit one attacker, Paul Perry, in the calling for help. He warned Fleming to struck the robber in the leg. Martin did not back, and Paul and the other attacker, stop doing what he was doing or he would have a concealed carry permit, but in Dela- Paul’s brother Holden, fled. The two at- shoot, and Fleming attacked him. Ingram ware, citizens are allowed to carry a loaded tackers were caught when they called for shot Fleming once, killing him. n gun for protection if it is clearly visible. an ambulance. — KurT williAmSeN THE NEW AMERICAN • APRIL 28, 2008 41
  • 42. Guaranteeing Gas Pains iTem: The New York Times on March 25 editorialized in favor of increased taxation on gasoline and other energy sources, say- ing: “Higher taxes on energy mean other rich countries are more energy-efficient across the board. The average German or Japanese uses little more than half the en- ergy consumed by an average American.... Americans are beginning to curb consump- tion. Gasoline demand declined in the first 11 weeks of the year for the first time since 1997. But it is far too little, and government policy is lagging far behind the problem.... A lot more needs to be done to prepare the American economy for a world of scarcer, more expensive energy.” iTem: One of the nation’s “leading en- ergy economists,” according to a release from Carnegie Mellon’s business school published in Mississippi’s Sun Herald for March 27, “believes that fuel costs are actually well below what they should be AP Images to reflect actual market value.” Profes- sor Lester Lave of the Tepper School of Business at Carnegie Mellon University Burning our food: According to UN figures, world food prices have risen 65 percent since 2002, maintains that the real cost of a barrel of and dairy prices alone rose 80 percent in 2007. Yet calls echo from intellectuals to give subsidies oil is more than $200. “Lave also believes for ethanol production and add production-reducing penalties on oil companies. this truer cost of oil should be communi- cated to the market with a gasoline tax gas tax dollars they siphon from Ameri- But, it may be argued, who will pay that raises the price of a gallon of gas to cans, why should we compound the error for the roads? An apt response might about $7. He says this would help to curb by fueling the government’s insatiable be, why should such projects be funded demand, stimulate the economy and break appetite? through Washington? As pointed out by America’s dangerous addiction to oil.” Consider some of the all-too-typical John Hood, president of the John Locke “Although he acknowledges such a tax projects that have been bankrolled by the Foundation: “There’s nothing magical would be unpopular among consumers federal government through gasoline taxes about ‘federal’ funding of local roads. The and elected officials alike, Lave believes — monies supposedly reserved for roads. money doesn’t come flying in from some it would actually serve as a boon to the The Tax Foundation compiled such gems Neverland. Instead, the system simply U.S. economy, adding nearly $500 billion as the following from the 2005 Highway compels motorists to send gobs of money to federal coffers.” Bill: $6 million for graffiti elimination in to Washington every time they fill up their correcTioN: The professor may be an New York; $2.95 million to Alaska for tanks. The politicians in Washington then “intellectual” and his profession may be a film about state roads; $2.2 million to swipe one-quarter of this gas-tax money honorable, but one would have to be com- construct a waterfront esplanade at Fort for non-highway purposes, such as build- pletely devoid of common sense or down- Totten in New York; $8 million for a Har- ing underutilized transit lines and financ- right duplicitous to contend that dramati- lem Hospital garage; almost $4 million ing the federal budget deficit.” cally raising taxes on vital energy supplies for the National Packard Museum in War- Writing in Investor’s Business Daily, will be a boon to the U.S. economy. Euro- ren, Ohio, and the Henry Ford Museum Hood notes that after the feds grab their peans now pay higher gas prices. Are we in Dearborn, Michigan; $2.4 million for a share, the remainder of the funds “is re- supposed to believe that higher gas prices Red River National Wildlife Refuge Visi- turned to the states, but not in ways helpful stimulate their economies? tor Center in Louisiana; and $1.2 million to most American drivers. For one thing, One of the surest ways to get less of to install lighting and steps and to equip federal highway dollars don’t flow back something is to tax it. Moreover, with the an interpretative facility at the Blue Ridge to states in proportion to how much they feds continuously misusing the billions in Music Center. pay in. Many populous states with major 42 THE NEW AMERICAN • APRIL 28, 2008
  • 43. transportation challenges — such as Texas, had profits below 10 percent of rev- gas industry without trying to approach Florida, Michigan and my home state of enue. Those percentages aren’t high the even more crushing levels of socialist North Carolina — have over the years when compared to other industries. European economies. Citing figures gath- been net losers. They’d certainly be better Bank of America operates with an ered by the U.S. Energy Information Ad- off if Washington stopped ‘helping’ them. 18-percent profit margin, according ministration, API notes that 2006 income Even if the outflow were more equitable, to Forbes.com. Berkshire Hatha- taxes as a share of net income averaged most states would end up on the losing end way has profit margin of 11 percent. 40.7 percent for U.S. oil and natural gas of the deal. You see, federal highway dol- AT&T: 11.8 percent. Procter & Gam- companies, compared to 22.1 percent for lars come with strings attached. They force ble: 13.1 percent. U.S. manufacturing industries. states to pay prevailing union-scale wages, By the newspaper industry’s stan- Not only do U.S. government tax poli- for instance, jacking up the cost of high- dards, oil companies must be on the cies hurt production, but when federal way construction in many jurisdictions.” verge of collapse. Newspapers, in restrictions are piled on, those injuries Although new gas taxes would undoubt- spite of incessant fears that the in- are intensified. At the same time, much edly not be spent well, would hinder state dustry is declining, reported pre-tax untapped energy remains on federal lands road construction, and would torpedo our profit margins “in the high teens” in and waters, often restricted from access. economy, many congressmen will obvi- 2007, according to the Project for Ex- Sitting on such federal property is an ously support them so the congressmen cellence in Journalism. estimated 635 trillion cubic feet of natu- can fund pet projects regardless of the ral gas, reports API, enough to meet the taxes’ effect on you and me. To reiterate: more taxation won’t result in natural gas needs of 60 million American Oil and natural gas profits have been more production. Yet, more production is homes for 140 years. Federal lands also used to kindle a propaganda firestorm not the objective of the establishment left. hold an estimated 112 billion barrels of against the industry’s supposed greed. You will recall, as noted in the excerpt recoverable oil, sufficient to produce gas The facts are much different than usu- quoted at the beginning of this column, for 60 million automobiles and fuel oil for ally portrayed. Average gasoline industry that the expressed goal of the New York 25 million homes for 60 years. earnings in 2007, according to American Times is to pave the way for scarcity — If the government actually wanted to Petroleum Institute (API) figures, aver- to force Americans to use less oil, not to assist U.S. energy production and it could aged 8.3 percent, below many other indus- produce more. only do one thing, this is what would work: tries — though this didn’t seem to filter The tax level is quite high enough al- get out of the way. n through waves of indignation. By com- ready, thank you, in the oil and natural — williAm P. hoAr parison, there is little outrage over the 15 cents for every dollar’s worth of gasoline Where the dollars go: Average gasoline industry earnings in 2007 were 8.3 percent. Fifteen cents at the pump that goes to the government of every dollar spent at the pump goes to taxes. That’s 15 percent. — which produces nothing but red ink. ExxonMobil reports that it paid $105 bil- lion in taxes in 2007, or more than two- and-a-half times as much as its profits. And profit, lest we forget, is a company’s primary responsibility to its shareholders and employees. When it comes to manufactured in- dignation over profits, the outrage in the media and on the political left is very se- lective. As summarized by the Virginia- based Business & Media Institute: Journalists have a history of ignoring how little control oil companies have over the price of oil or gasoline. Nor do they focus much on how oil com- panies invest their profits in research and development.... ExxonMobil’s profit was about 10 percent of rev- AP Images enues. Chevron and ConocoPhillips THE NEW AMERICAN • APRIL 28, 2008 43
  • 44. THE LAST WORD by wArreN mASS Taiwan’s Dangerous Game O n March 22, voters trade with China. Back then, on Taiwan elected China had no money to spend Nationalist Party Ma Ying-jeou on American goods, except candidate Ma Ying-jeou, a shakes hands what it could receive from with supporters Harvard-educated lawyer and the sale of illicit narcotics. former Taipei mayor, as presi- The so-called U.S.-China dent of the Republic of China. “trade” was financed by Ma, who defeated Democrat- long-term, low-interest loans ic Progressive Party candidate (gifts, actually) guaranteed by Frank Hsieh by a 58-percent the U.S. Export-Import Bank to 42-percent margin, will and made possible by funds be Taiwan’s first president to extracted from the American have campaigned for closer taxpayers. economic relations with com- A few decades later, thanks munist mainland China. to its economy being jump- The news of Ma’s election started by the United States, AP Images triggered a surge in Taiwan’s the vast outsourcing of man- stock market, prompted by ufacturing to China by U.S. expectations that Ma’s eco- companies, and the flood of nomic policies will spur the nation’s stagnant economy. The Chinese imports, the Chinese are so flush with cash that William president-elect said in a March 23 interview that he hoped his Schneider, CNN’s senior political analyst, wrote in an October new policy of opening Taiwan to tourism from mainland China 25, 2005 article, “Re-evaluating U.S. Debt”: “China’s invest- would have a positive effect on the economy within 100 days of ment in U.S. government debt has more than tripled in the past being implemented. five years, from $71 billion in 2000 to $242 billion in 2005.” In If the voters of Taiwan seem shortsighted for emphasizing simple language, we are in hock to the Chinese. economic prosperity at the expense of national security and even The people of Taiwan are playing a dangerous game in getting future sovereignty, maybe they are merely playing the hand dealt cozy with Beijing, which would break trade agreements, na- to them by the world’s superpowers (the United States included) tionalize foreign companies established in China (just as Castro as best they can. President Bill Clinton admitted bluntly in his did after coming to power in Cuba), and take even more drastic 1998 Shanghai Library remarks on “Shaping China for the 21st actions, including military, if it thought it was in its interest to Century”: “We don’t support independence for Taiwan, or two do so. Mainland China is the largest communist power in the Chinas or one Taiwan, one China. And we don’t believe that world, with a population of over 1.3 billion and an army of 2.3 Taiwan should be a member in any organization for which state- million active troops. hood is a requirement.” But Taiwan is merely emulating on a smaller scale what the Clinton’s remarks reflected a long history of U.S. acquiescence United States has been doing for years. As William R. Hawkins, and even favoritism toward the communists on mainland China. senior fellow for national security affairs at the U.S. Business and In fact, U.S. policies encouraging trade deals with China, includ- Industrial Council, wrote in an April 20, 2005 commentary: ing even deals subsidized by the U.S. government, have helped to make China a major player in the international marketplace. The ability to boost military spending is a function of being Yet, in terms of the balance of trade with China, Taiwan is “prosperous,” and the massive American trade deficit with actually faring much better than we are. A report posted at the China gives Beijing the hard currency needed to finance communist Chinese government’s website at the end of 2006 in- foreign weapon acquisitions — mostly Russian systems dicated that the value of goods exported that year from Taiwan to designed to attack American targets. As for “transforming,” the mainland totaled $79.2 billion, while Taiwan imported $18.9 it seems Beijing is only moving from a moribund com- billion of goods from the mainland. The report observed: “The munism to an energetic fascism. Is it really so difficult to mainland has become the biggest export market and the biggest connect the dots? source of trade surplus for Taiwan, according to the [mainland Chinese] ministry [of Commerce].” The danger for Taiwan (as well as for the United States) is easy On the other hand, the United States suffered a $232 billion to understand if we realize that all communist governments are deficit with China that same year. U.S. trade with China has run by gangsters. The naïve businessman who forms a partner- been a losing proposition since the days when President Nixon ship with a gangster soon finds out that the gangster controls his first called for the “normalizing of relations” and establishing business, as well as his life. n 44 THE NEW AMERICAN • APRIL 28, 2008
  • 45. First Ten Amendments to the Constitution Article I. Congress shall make no law respect- life, liberty, or property, without due process of law; ing an establishment of religion, or prohibiting the nor shall private property be taken for public use, free exercise thereof; or abridging the freedom of without just compensation. speech, or of the press; or the right of the people peaceably to assemble, and to petition the Govern- Article VI. In all criminal prosecutions the ment for a redress of grievances. accused shall enjoy the right to a speedy and public trial, by an impartial jury of the state and district Article II. A well-regulated militia being wherein the crime shall have been committed, which necessary to the security of a free state, the right of district shall have been previously ascertained by the people to keep and bear arms shall not be law, and to be informed of the nature and cause of infringed. the accusation; to be confronted with the witnesses against him; to have compulsory process for obtain- Article III. No soldier shall, in time of ing witnesses in his favor, and to have the assis- peace, be quartered in any house, without the tance of counsel for his defense. consent of the owner, nor in time of war, but in a manner to be prescribed by law. Article VII. In suits at common law, where the value in controversy shall exceed twenty dollars, Article IV. The right of the people to be the right of trial by jury shall be preserved, and no secure in their persons, houses, papers, and effects fact tried by a jury shall be otherwise re-examined in against unreasonable searches and seizures shall any court of the United States, than according to the not be violated, and no warrants shall issue, but rules of the common law. upon probable cause, supported by oath or affirma- tion, and particularly describing the place to be Article VIII. Excessive bail shall not be searched, and the persons or things to be seized. required, nor excessive fines imposed, nor cruel and unusual punishments inflicted. Article V. No person shall be held to answer for a capital, or otherwise infamous crime, unless on Article IX. The enumeration in the a presentment or indictment of a grand jury, except Constitution, of certain rights, shall not be construed in cases arising in the land or naval forces, or in the to deny or disparage others retained by the people. militia, when in actual service in time of war or public danger; nor shall any person be subject for Article X. The powers not delegated to the the same offense to be twice put in jeopardy of life United States by the Constitution, nor prohibited or limb; nor shall be compelled in any criminal case by it to the states, are reserved to the states respec- to be a witness against himself, nor be deprived of tively, or to the people. We at Dean Sellers Ford believe freedom of mobility is as fundamental as our Bill of Rights. See Dean Sellers Ford for your new freedom machine. 2600 Maple Rd., Troy, Michigan (248) 643-7500 www.deansellersford.com
  • 46. “’Tis our true policy to steer clear of permanent alliances with any portion of the foreign world....” – George Washington (1796) “Commerce with all nations, alliance with none, should be our motto.” – Thomas Jefferson (1799) “I deem [one of] the essential principles of our government [to be] peace, commerce, and honest friendship with all nations, entangling alliances with none....” – Thomas Jefferson (1801) PRISM MANAGEMENT COMPANY, INCORPORATED PRISM: Any medium that resolves a seemingly simple matter into its elements Consultants and administrators Specializing in Tax Deductions for Dental Practices Post Office Box 7007 • Porter Ranch, CA 91327