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April 10, 2008 - Rush Limbaugh Program
36:20
April 10, 2008, Thursday, Hour #2
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Second hour now up and running on the Rush Limbaugh program.
I am Jason Lewis back at it, back behind the golden EIB mic in the Attila the Hun chair, the Northern Command version that is.
Talent on loan from Rush for the next day and a half, I guess.
We're one hour into this one.
Rush will be back on Monday.
In the meantime, don't forget to check out rushlimbaugh.com.
The number is always 1-800-282-2882.
I just want to get in one more thing on this housing crisis, if you were.
It's not a crisis, it's a correction.
And again, I know that's trauma to a lot of people that don't like to see the value of their home going down.
But the U.S. Congress, actually the Senate today, have passed this huge bailout, now $20 billion, an implicit taxpayer guarantee of future foreclosures.
The deal basically says if the lenders mark down the value of your mortgage, so let's say you have a mortgage of $300,000, the Democrats in the Congress are saying, well, let's ask the lender to mark that down to $280,000, and then the taxpayer will back up the rest of it vis-a-vis the FHA.
Now, number one, even if that props up prices for a while, sooner or later they're going to deflate, and you're going to have to subsidize them again.
But what does that say to everybody that's doing the right thing with their mortgage with regard to their mortgage?
And for a lot of people, this was not a crisis.
A lot of people, they owed more on the mortgage than their house was worth.
They walked away.
It wasn't a crisis for them.
It was a crisis for that nasty predatory lender and all those Wall Street firms that bought mortgage-backed securities.
Which leads me back to Senator Charles Grassley in his hearing last week.
I think it was last Wednesday.
He was asking the SEC, the Securities and Exchange Commission Inspector General, for an independent review of the agency's handling of the 2005 investigation into Bear Stern's pricing of mortgage-related assets.
Now, Bear and some of these firms got in trouble, and for lack of a better description, we'll just say they started to write for fees options on all these mortgage-related securities.
That is, they'd buy mortgage-backed securities.
Freddie Mac or Fannie Mae, Freddie Mac, they dice and slice these mortgages into securities.
They hand them out.
Investment firms buy them.
Then they allow people to bet on them.
They have credit default swaps, derivatives, if you will, based on these.
And there's an unlimited number of those they can write.
So if you've got a, you know, you're holding a mortgage as an investment, you've bought it back in the secondary market and you're holding it, that's a risk.
But now if there are a bunch of bets on that, options, they're not technically options, but we'll call them that.
Then you've exponentially increased your risk.
And I'm looking at this hearing, and Grassley is going after the SEC.
And he says, what can we do?
What can we do to make certain that in the future this doesn't happen?
What can the SEC do to price mortgage-related assets the right way?
And I thought to myself, what am I hearing here?
Since when is it government's job to make certain somebody doesn't bet the wrong way?
A lot of people that bought a second home for an investment, a lot of people that stepped up into a larger home, a lot of Wall Street firms that bought these mortgage-backed securities in the secondary market and then wrote those derivatives or credit default swaps for fees, by the way.
They were generating fees by writing this, were making a bet.
They were making the bet the party would never end.
They were making a bet these things would go up and down.
They bet the wrong way.
Now let them take their lumps.
Instead, the Fed comes in, again, an implicit taxpayer liability and says, don't worry, we'll take $29 billion of those nasty assets and let J.P. Morgan have the good ones.
I just, you know, folks, we're becoming a nation of capitalists when we make profits, and we're becoming a nation of socialists when there's a loss.
You cannot have capitalism without failure.
You cannot have success without failure.
They're the flip sides of a coin almost.
And then the same week in Congress, you've got Democrats, Ed Markey, or as Rush calls him, Ed Machi, from Massachusetts, grilling the oil company executive.
Now, to show you how out of touch these career politicians are who have never had a job in the private sector, think of the perversity of this line of questioning.
Mockie and company are grilling these members or these oil executives, who, by the way, the oil, let me just say this again one more time.
According to SEC documents, the oil industry's effective tax rate, unlike subsidies for agriculture, unlike subsidies for ethanol, the oil companies have tax rates in the neighborhood of 40 to 44%.
ExxonMobil's tax bill, get this, over the past five years, ExxonMobil's total U.S. tax bill has exceeded its U.S. revenues by $19 billion.
So what are we talking about, taking away subsidies from oil companies?
They are net payers.
They don't get a subsidy.
And yet he's drilling these guys.
And the fundamental question was, why aren't you doing more to invest in alternative fuels?
And I was just waiting, just waiting for one executive to put his reading glasses down, peer up at the member of Congress and say, well, because we're in the oil business?
How perverse is this?
How about getting a pharmaceutical company up there and ask them, why aren't you going into vitamins?
Why aren't you?
Because that's not the business I'm in.
Or maybe we don't have the freedom to actually have the business of our choice anymore.
I'm not certain.
But this is strange stuff going on.
So I wanted to get that out of the way as we begin this second hour.
Hey, a new book by John McCain called The Real McCain, scheduled to be released May 1st, citing unnamed sources.
You know, there's somebody citing an unnamed source in America every 30 seconds.
And what we've got to do is find that guy and stop him.
That's citing unnamed sources.
They say that McCain's temper, he loses his cool all the time.
He's too volatile.
The instability factor there.
McCain heard about this and supposedly said, if I find that guy, I'm going to punch him in the nose if he talks about my temper one more time.
So look for that book on John McCain coming out.
Oh, the Clintons.
I never, you know, Rush talked about this, but I haven't had a chance to chime in, so I'll give you my two cents worth.
$109 million over the past eight years.
That puts Bill and Hillary in the top 1-100th of 1% of taxpayers in America.
Now, if I made that much money, $109 million over the past eight years, I guess I could be in favor of a tax increase too.
But they're using their charitable deduction.
They claim $10 million in charitable giving, of course, for the Clinton Family Foundation.
You want to know why limousine liberals or Learjet liberals don't mind taxes?
Number one, they can afford it.
If you're a billionaire, you can afford to pay taxes.
The rest of us struggling to make ends meet, can't do it.
But number two, they can use these charitable deductions to literally control hundreds of millions of dollars.
All their donations went to the Clinton Family Foundation.
They've disbursed only half the money, according to the Wall Street Journal.
So they can use this foundation for strategic giving, they say.
And they claim $10 million deduction on it.
They set up these trusts.
I mean, the Buffett and the Gates are doing this.
Well, you know, you get those sorts of quote-unquote loopholes.
I guess taxes aren't a big problem.
But I thought to myself, what is so untoward or unseemly about this?
What is bugging me about this?
And if you take a step back, if somebody wants to pay Bill Clinton $51 million for speeches, have at it.
Have at it.
I don't care.
But nobody would have paid Bill Clinton $51 million to give a speech had he not had a career in politics.
Politics pays.
We have a situation where, and all too often, Republican and Democrat, The status quo, whether government grows or we actually get real and shrink the monopoly of force known as government, it still pays for a lot of people.
You take a look at a lot of these members in the House, and it's the best job they ever had, knocking down $170,000 a year, pretty generous benefits.
And we need people in government who don't need government.
We need people who make their millions and become a success before they go into government.
That's what a citizen legislature was all about.
That's what part-time governance is all about.
That you don't make a career of this.
You don't start out as an attorney general in Arkansas, and you don't start out then go on to governor or in the state house for 13, 14 years, and finally you become president, and all of a sudden, you've got $109 million for doing what?
Well, not producing a whole lot.
Not producing a whole lot.
Governments don't produce.
Governments don't invest.
For a government to invest a dollar, they first have to consume it from you or me.
They shuffle around dollars, not unlike trial lawyers.
So you've got a situation here where a guy became uber-rich based on a lifetime of quote-unquote public service.
Let's just dispense with this notion of public service, shall we?
I mean, Reagan goes to Japan, gives one speech, and he's pilloried.
Clinton gets $109 million from consultancy and speeches and all the rest.
And the problem, fundamentally, the problem is we've got too many people benefiting from government doing just what it's doing.
If you get people who have already successful in, you know, they've made their millions, they don't need the fame, they don't need the money, maybe they'll go to Washington, a la Ronald Reagan, and actually change the office instead of just merely trying to assume the office.
And you'll never get that from a careerist.
You'll never get that from people who are too comfortable no matter what happens vis-a-vis our freedoms.
Big story in Minnesota.
Columnist for the Star Tribune, a liberal paper, but they've got a conservative columnist by the name of Catherine Kirsten, has broken a story about a charter school funded with taxpayer dollars that is sponsored as well by the Islamic Relief USA based in California.
It's called the TISA Academy.
I believe the name is the Tariq ibn Ziyad Academy or TISA.
And you've got, and Kirsten had made a number of allegations about how they pray there and how they have after-school activities that are coerced, if you will, into Islamic prayer and that sort of thing.
They have ritual washing in their restrooms.
They have school assemblies with imams, all of this.
Now a substitute teacher has come out and confirmed what Kirsten has said, that this is, in effect, a religious school being funded by tax dollars.
In fact, the substitute teacher said, quote, I've been in a lot of schools and I've never been in a school where they had washing rituals or had a room where you had to take off your shoes.
Now, can you imagine if your school down the street had a Catholic priest or a Lutheran minister come in and they had a prayer and everybody was, you know, hauled into the gym and you had somebody prostrate on the gymnasium floor in a white robe as this school did.
And all of this was going on.
You know, there's a danger here, folks.
There's two dangers here.
Obviously, this is clearly a violation of case law, a violation of the lemon test that says there's this wall of separation between church and state.
Had there been a Western or Christian school devoted to this sort of theology, it'd be done yesterday.
But there's also the assimilation factor here.
We are balkanizing America.
These people are not assimilating.
They are separatists.
Now, do we want to do that with tax dollars?
And do we want to do it regardless?
But I wanted to bring you up to date on that because remember, after 9-11, a lot of people were criticizing the schools in Saudi Arabia over their anti-American pedagogy.
Well, it may be happening right now in America.
1-800-282-2882.
I'm Jason Lewis in for the great one.
El Rushbo, back with your calls when we return.
1-800-282-2882.
Welcome back to the Rush Limbaugh program up and running for a Thursday.
I am Jason Lewis, greeting conversationalists across the fruited plain for the next day and a half.
Talent on loan from Rush to me and to you, hopefully.
Let's go back to the phones right here in Terry in St. Louis, Missouri.
You're next up on the Excellence in Broadcasting Network.
Hi.
Hi, Jason.
How are you doing?
I'm doing well, sir.
How are you?
I'm great.
I agree 200% with everything you are saying with regard to basically economics and particularly the bailouts.
Behavior that's subsidized is continued.
And I see it going two ways.
We're creating a more dependent populist group of people in the United States who continually look to Washington.
On the other side, we see the politicians, particularly in an election year like we are now, basically buying votes with your money in mind.
And my real question is, how do we break the cycle?
I mean, people are working to get away from the people who are going to be able to do that.
Well, there used to be.
Yeah, right.
There used to be an opposition party to this.
It was called the Republican Party.
Yeah, I heard in distant history they did.
Yeah, remember those guys?
Yeah.
And instead, they've thrown in the towel on a number of issues, on regulation, on education, on the environment.
And therefore, instead of, they're taking the wrong lessons from 06.
You know, in 2006, the Republicans didn't lose because they were too conservative.
They had grown spending faster than Lyndon Johnson in the previous five years.
We had expanded education control over the states.
We had the Medicare, you know, the RX drug plan.
We had all of this nonsense.
It didn't get one liberal to vote for a Republican.
Oh, you know, I was going to vote against these nasty Republicans, but since they gave us the Medicare drug benefit, I think I'll vote for them.
No, all it did was disillusion Americans, diluted the difference between the parties, and now there's no opposition party, nothing to stop the juggernaut of government growth.
And let me tell you something.
You know, you're really onto something here, Terry.
When you talk about what these people want to do, remember the S-CHIP debate, the state children's health insurance program?
Absolutely.
Remember how they wanted to insure anybody, even if they made up to $83,000 a year in New York?
Well, the Bush team at one point came back and said, well, wait a minute.
We don't even have the indigent insured on this program.
There are a lot of people that aren't in it who are poor.
Why do you want to expand it?
Because the goal is not to help the poor.
The goal is to get everybody in a government program to get everybody under government control.
So now, if you take a look at the quote-unquote housing crisis, here's what we've done.
And this is the Democrat plan.
And again, without serious Republican opposition, this is the Democrat plan that says, here's what we're going to do for all these Wall Street firms.
We're going to have the Federal Reserve come in and bail you out.
But in exchange for that, are you ready?
We're going to regulate you.
Well, it's control, Jason.
You know, Steph Parker, and I know you know who she is, wrote a great book.
It's called Uncle Sam's Plantation.
And the politicians are continuing to expand the plantation.
I'm terribly frustrated because I've got a friend in another city who's a council member on their city council, been reelected.
And, you know, he says the key to success is pissing off as few people as possible.
The key to success is freedom to fail and freedom to succeed.
The key to success is freedom.
Well, that's very true in the true economic sense.
And as a nation, we are probably economically more ignorant than anything else.
But the thing is, how do we break that?
And we've got politicians now, particularly as we see the Democrat majority with a high probability of growing.
Where do you break it?
Well, I mean, this is a great debate, and Rush has talked about this many times.
We have a conundrum in the Republican Party because the putative standard bearer, or the actual standard-bearer, has raised skepticism over tax cuts in the past, has embraced the open border argument, has embraced an assault on the First Amendment, has embraced a global warming piece of legislation that will destroy the American economy.
So I will tell you what I'm doing.
I'm just making my statement this way.
I will not support any candidate who buys into the global warming man-made crisis or the man-made global warming crisis.
I just will not do it because that is going to be a tax increase that would dwarf any relief we could get statutorily by lowering the rates.
It's going to destroy the economy.
You're looking, you know, the National Association of Manufacturers, along with the American Council of Capital Formation, they've come out with a couple of great studies on the cost of the Lieberman-Warner bill, and it will devastate jobs, personal income, and GDP.
You're looking at hundreds of billions of dollars.
That's national income, folks, that will not be around if we basically tell people you can't consume energy.
You're absolutely correct.
And I'm a part-time professor at one of the local universities.
I was shocked to find out that in the MBA program, they don't even require the students to take economics anymore.
Not surprising.
They call those folks voters.
Anyway, hey, Terry, thanks for the call.
That is the fundamental problem.
And I'm, look, I've had it.
I'm not going to live forever.
And John Maynard Kane said, in the long run, we're dead.
So we better get what we want now.
And what I want now is a return to some semblance of Reaganism.
That's what I'm looking forward to.
I wish we would get it.
But you're not going to get it with this environmental obsession.
If you're claiming to get the endorsement of the Sierra Club, if you're claiming to be an environmentalist as we know it, mandating light bulbs, we've reduced to mandating the kind of light bulbs people have to buy, that's freedom.
If you're doing that, that's fine.
You can be that, but you can't be a conservative.
They are mutually exclusive, my friends.
And that's what I'm talking about.
More on this when we return.
Welcome back to the Northern Command of the Excellence in Broadcasting Network.
I am Jason Lewis, Minnesota's real anchor man, sitting in for the big guy.
He's gone today and tomorrow.
We'll be back on Monday.
Speaking of global warming, Minnesota, especially the central and northern half of the state, foot of snow, supposedly tomorrow, April 10th.
This is global warming.
I can hardly wait for global cooling.
More on that perhaps tomorrow, if this thing materializes.
There was also a Senate hearing on the effects of global warming internationally.
I'm telling you, never, never has so much malarkey been put forth and been consumed by individuals than this fiction known as man-made global warming.
Now, there simply is no correlation here.
I'm not going to get into it now because I'll just keep going and going.
I don't want to do that.
Maybe tomorrow when we talk about that, but this winter ought to put this to rest.
In fact, the last 10 years ought to put it to rest as temperatures have plateaued, even though greenhouse gases have gone up.
I want to explore just for one second the dichotomy that Terry was talking about from St. Louis before we get to the rest of the calls.
And that is this notion about what kind of economy do you want to live in?
Do you want to live in an economy where you can fly as high as your wings can take you?
And that really was the American dream.
Remember, our revolution was an economic revolution.
In 1765, the Stamp Act, the Coercive and Intolerable Acts, the tea tax, they were all designed to remove the rights of property and the fruit of your labor from the colonists.
That was the dream of America, where you could go to a place to get rich.
Not the crime of having too much.
That's the beauty of this nation.
It's not an aristocracy.
It's a meritocracy.
And we're losing it.
And we're losing it through this sort of soft security.
You know, I think this quote's been attributed to Franklin, but it may have been somebody else.
But those who would give up freedom for a little security wind up with neither.
That's where we're going.
And if you just take a look at the quote-unquote housing bubble, it's a perfect example of the Barack Obama plan, the Hillary Clinton plan, the Democrat plan passed today in the Senate, says, here's the Faustian bargain we'll give you.
If we can regulate you, you investment banks, if we can regulate you, then we'll bail you out.
So the Fed comes in, rescues Bear Stearns, cuts the deal with J.P. Morgan Chase, and in exchange for that, oh, we've got to have some SEC oversight of these investment firms.
So we have the perfect storm.
This is what the liberals want.
They want a regulated economy with taxpayers on the hook.
They can control everything.
Now, it's going to stifle innovation, and it's going to give us massive taxpayer bailouts a la the SNL crisis back in the early 1990s, where we, the taxpayer, insured the deposits.
But don't worry, the government, the Keating Five, and I'm not going to mention who was in the Keating Five, don't worry, the government is going to regulate the SNLs so the taxpayer won't be liable.
That worked really well.
The regulators were no match for political interests, and the taxpayer ended up bailing out the SNLs, had to form the Resolution Trust Corporation, got a few assets back.
That's about it.
Now we're going the same road on Wall Street.
And some in Wall Street really like it.
Those are all the people on Wall Street giving money to Democrats, and they are more numerous than the other way around, I'm afraid.
So that's your choice.
That's the dichotomy, if you will.
You can have the liberal plan where the government regulates everything and subsidizes everything, or you can have the dream of the founders where you are free to rise as high as your abilities can take you without a subsidy, but you can profit to your heart's content, but you're also free to fail.
That's the choice.
And it's not even really an economic argument.
It is a moral argument.
1-800-282-2882, I'm Jason Lewis.
This is Nick in Watertown, New York.
Welcome to the Excellence in Broadcasting Network.
Thank you, Jason.
Good afternoon.
Same to you.
Jason, I'm calling because I wholeheartedly agree with you.
These people who have gone and gotten mortgages that they can't afford and then default on their loans, they deserve to lose their houses.
It's predatory lending, Nick.
Come on.
I'm 49.
I've been working for 30 years.
I have a house that I can afford.
My wife and I drive eight and 10-year-old cars that are paid for.
Our credit card debt is zero.
And I'm saving for my retirement and for my college education for my two children.
Right.
Why isn't the rest of the country doing this?
Why is it the government's job to bail me out if I get into trouble?
Because we have a national shortage on responsibility.
There you have it.
There you have it.
And I'll tell you, when they announced this tax incentive rebate plan, I emailed the White House and I said to him, I don't want this rebate.
I want you to keep this rebate and put it towards the national debt so that my kids and my grandkids aren't in worse shape than we're in today.
Ironically, they expanded the national debt with a rebate.
I mean, everybody talks, the Democrats love to talk about the deficits.
They just increased the deficit $150 billion to pay for the rebate.
I think that was the figure.
And by the way, it does nothing for the economy because every dime of a rebate people are getting is coming out of the private economy through borrowing.
So what you're doing is you're substituting immediate gratification, immediate consumption spending if people spend these rebate checks.
You're substituting that for capital investment spending, which will grow the economy down the road.
It is a horrible idea.
Rebates never work.
They didn't work for Jimmy Carter.
This won't work.
If you really want to expand the economy, what we could do is get a handle on inflation and guarantee the Bush tax cuts, the marginal rates of return will not go up.
The capital gains rate will not go up.
The dividends tax will not go up.
Tax rates on working will not go up.
Then you would instill some confidence in the markets.
But a rebate plan is not going to do it.
And it's symptomatic of really what you're talking about here.
Absolutely.
And the problem is, unfortunately, there are too few voters out there who have that fiscal conservative viewpoint and too many who look at this rebate and go, ooh, that's great.
I'm going to keep these guys in office.
Well, look, never underestimate an individual's ability to rationalize, whether it's the ethanol subsidy seekers, the agricultural community, whether it's export-import bank monies.
I mean, I could go right down the list of subsidies that we hand.
I mean, my favorite, and I'm a big baseball fan, but my favorite are subsidies to baseball owners and players.
We need to build them.
I've been watching the home opener.
It was a great game in Washington, but I'm watching the $600 billion stadium built for wealthy players and wealthy owners.
If we can't say no to that, I mean, let them build their own edifice.
Yeah.
You mentioned the tea tax a few minutes ago.
And I have to share, my daughter is in elementary school.
She brought home some type of a spelling paper, but they talked about the incident where the tea accidentally fell into the Boston harbor.
I had to laugh because liberalism, you know, liberalism is just subvertly sneaking into our education system where it wasn't an act of defiance.
Oh, my God.
It fell into the harbor.
Oh, my.
What's next?
The founding fathers accidentally stumbled upon freedom?
Yeah.
I don't know.
That reminds me, after 74 years, the Soviet Union collapsed accidentally.
Just so happened after Reagan's arms buildup, after Reagan broke the back of their economy.
But it was just accidentally, it just collapsed.
Amazing, isn't it?
Yeah.
Nick, I got to go, but thanks for the call.
You're really on to something.
I don't think the politicians in Washington have an inkling of how popular Nick's point of view is.
You talk to anybody, and this transcends political parties, I do believe.
I mean, Democrats want to do this, and a few liberal Republicans want to do this because they want to bail somebody out and try to get a vote.
But the vast majority of Americans, the vast majority of Americans, this is how out of touch these people are, are saying, why are we bailing out someone who bet on housing prices going up so they bought an investment or they moved up to a house maybe they couldn't afford?
There was no lying at the closing.
There was no predatory lending.
People know what their payment's going to be now and in five years.
So why are we bailing these people out?
Why are we bailing out the Wall Street firms that bought those mortgages and sliced them up into investments and then sold derivatives based on those or credit defaults?
Why are we bailing out those people?
The vast majority of Americans are saying they're much wiser than Washington.
They're saying no, bail out.
Let the market correct and everybody will be fine once again.
Justin in Cincinnati, you're next on EIB.
Hi.
How you doing, Jason?
Doing well, sir.
Did you put away your winter coat up there yet?
Sounds like you're going to need it.
Can you believe this?
This is the winner without end.
It is, my friend.
I'm glad spring is here down in Ohio.
But I wanted to comment on what you're saying about no risk, no reward kind of concept, you know, from an economic standpoint and how liberals are just illogical and can't understand that you can't have an economic system that has no risk and expect to have any rewards.
And it's eerily similar to the environmentalist movement where people want to protect every known species that's out there right now, and they never want to see anything change, never want to see anything go extinct.
When you look across history, 99% of all species that have ever existed are extinct, and that's how progress is made in evolution, is death and the extinction of existing organisms.
It's just ridiculous.
You couldn't be more correct.
What you're talking about is we don't live in a static world, whether it's the hard sciences or the social sciences.
We live in a dynamic world.
Change is the only constant.
And whether that change means some business goes under, another business is created.
It's called creative destruction.
Absolutely.
And, you know, you'll never get the innovation when you start to guarantee things or we want to keep things static.
What you get is statism.
You get kind of a Mussolini corporate socialism.
You're absolutely right.
And the concept of trying to take some of these status ideas to health care just drives me bonkers.
I'm in the healthcare industry myself.
My wife and I both are on high-deductible health plans with HSAs.
You bet.
We're young.
We were saving a lot of money.
And you know what?
It's the best thing we've ever done.
Yeah, let me tell you something.
The Bush administration really had.
I mean, I've been critical of the Bush administration because they've gone too far portside with their big government conservatism and Michael Gerson, the former speechwriter, bashing Republicans who believe in Reaganism.
But I will tell you, the Bush administration's plan on health care that he unveiled and the Republicans immediately dropped in Congress and didn't push was brilliant.
The idea of moving the tax deduction, Justin, to the individual from the corporation, the idea of getting rid of some of the mandates, allowing people to buy insurance nationwide instead of within their own state, it would have instantly made insurance more affordable for 100 million people.
Absolutely.
I mean, and people don't understand these cause and effects with insurance and really how it works.
Your earlier caller on the insurance side, she was clearly a little bit out of her mind.
Do you mean Jennifer from Jacksonville?
Yeah, I got you, buddy.
Thanks for the call.
I got him moved.
We'll be back right after this on the Rush Limbaugh program.
Having more fun than a human being should be allowed.
You always do when you sit in for Rush.
The Rush Limbaugh program now up and running for Thursday.
I'm Jason Lewis.
I'll be here tomorrow for Open Line Friday as well.
And then Rush returns on Monday.
In the meantime, check out RushLimbaugh.com or give us a call today or tomorrow.
1-800-282-2882.
Back to the phones in our beautiful Orlando.
Pat, been waiting very patiently all this time.
Go ahead.
You're on EIB.
I'm a retired health care professional, and I appreciated your rant, including the bear stars as far as health care and also the subprime.
Thank you.
By the way, I mentioned to Newt Gingrich 20 years ago that this might be a modus operandi, the way the dual tax code was, to later a socialized health care system.
But he wasn't really interested in listening.
But none of this is the reason I called.
I called about sound money.
And also, that was a Republican, and I have always voted Republican.
Nixon, when he took us off the gold standard, created a system that now there's all types of monetary mischief that is possible.
And in my next comment, I lived in China seven years.
I love the Chinese and I believe in free trade.
But it is my belief that the Treasury Department and investment banks had a situation where when we bought all this and the Chinese recycled all of their dollars back into Treasuries, this kept our interest rates artificially low without any market mechanism to correct it.
The Federal Reserve then used that situation as a conundrum, which said that we can really keep our other interest rates low domestically because they say there's no threat of inflation.
And I'm just saying that somehow or another, we have got to get that back to a sound currency and a gold-backed currency.
Not that gold is anything mystical about it.
It just keeps the Federal Reserve from pumping out money.
All right.
That's a lot.
Let's start at the beginning here.
Fundamentally, what you need for currency protection is an alternative currency so that if your currency is devalued, the government's printing money, creating fiat money, people can turn to the alternative.
Now, the beauty of the gold standard is it did this automatically.
That is, if the government started printing money, dollars were devalued.
People started turning in their dollars to the government at the gold window in exchange for gold.
They went to the alternative currency.
Well, the effect of that was it shrank the money supply and the dollar grew in strength again and it automatically corrected it.
Now, the problem with that, Pat, is nations never stay on a gold standard.
I mean, Bretton Woods failed.
It wasn't the best system, but it failed.
And the gold standard failed because, as you know, when you have a gold standard, you get these gold flows with a trade imbalance, and it makes an economy contract at times.
And we have this notion in America today, which gets us to the subprime thing, that we should be immune from any recession.
And I don't understand this.
The difference between the depression and the business cycle.
And what politicians, and this goes back to the previous caller, too, what they promise people is the good times will never end.
And that means printing money.
That means keeping rates artificially low.
That means we're going to bail out the housing market so the prices never drop.
Well, we'll do it.
But the problem with that is, as you know, is if you're unwilling as a nation to go through a minor correction or a minor recession, you are setting yourselves up for a big one.
And we're setting ourselves.
Let me finish.
Let me finish and then I'll let you get in.
We're setting ourselves up for a Jimmy Carter-style stagflation with a specter of massive tax increases and easy money.
I would say we're there now with the inflation rates the way they are.
We've got stagflation staring us in the face.
Well, exactly.
But again, I love China and I'm not against China.
That's just one part of the link.
But the fact was, is it kept long-term rates artificially low.
The Fed used that as a reason to keep all of our interest rates low, which created all of these bubbles because of all the money going out.
Well, let me challenge you here a little bit.
This is Greenspan's line.
Greenspan's line is, look, it wasn't our problem, the Federal Reserve problem in America that created this, first the tech bubble in the 1990s and then the housing bubble now.
People have to understand when there's too much money flowing around, when government starts to print money, there's no wealth created.
There's just more money chasing the same amount of goods and they end up chasing an asset, in this case housing, and it drives the price up and it's an artificial bubble.
And that's what Pat's talking about.
Greenspan says it wasn't us.
The world is going through inflation right now.
Exactly.
All the central banks are printing out money.
And that's the reason all the prices are going up all over the world, including the food that people are fighting over right now.
But, you know, it is out of control.
And I wanted to mention one more thing, if I could.
If they're going to give a 20,000 credit toward a mortgage, how about giving us all $20,000 credits?
That'll stop that foolishness real quick.
Well, I got to go, Pat.
Great points all.
It really does discriminate against the people who have done the responsible thing and, quite frankly, haven't foreclosed in many cases when times got tough.
I'm Jason Lewis, Infor Rush Limbo on the Excellence in Broadcasting Network.
You know, speaking of government regulation and its inefficiencies, a lot of you are stranded because the FAA has grounded a bunch of flights when they hit Fine Southwest and now they've got American Airlines.
Did you know this wasn't a safety of flight issue?
Wall Street Journal had a good piece on that today.
These are all technical compliance issues.
Now, I'm sorry, if you believe in free markets, folks, the airlines have every incentive to be safe.
Here's a news flash for the media: plane crashes don't do much for business.
Yet the FAA is micromanaging, making it more difficult for these guys to show a profit and stranding thousands of passengers as we speak.
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