Thursday, 22 July 2021 — Wollongong, Australia

By Greg Canavan Editor, The Rum Rebellion

[6 min read]

Dear Reader,

‘The further a society drifts from truth the more it will hate those who speak it.’

‘All tyrannies rule through fraud and force, but once the fraud is exposed they must rely exclusively on force.’

‘The people will believe what the media tells them they believe.’

‘In a time of universal deceit — telling the truth is a revolutionary act.’

You’d be forgiven for thinking that these quotes by George Orwell make him a textbook libertarian. But in fact, he was a committed socialist.

He had a privileged upbringing. Educated at Eton, he was part of the British establishment. He helped administer the Empire, joining the civil service in Burma.

But he rejected it and considered himself a ‘democratic socialist’.

Like most people seduced by socialism, Orwell believed it would work if only done the ‘right way’.

But all forms of socialism tend towards outright tyranny. Every individual whim is subjected to the ‘state’ (which is really just a bunch of individual tyrants telling everyone else what to do). What starts out as a quest for a classless society and egalitarianism ends with forcing equality at the end of a gun…or a needle.

The French Revolution overthrew the tyranny of the monarchy and replaced it with the Red Terror, as the revolutionaries turned on themselves with liberal use of the guillotine.

The Bolshevik Revolution ended up with Stalinist totalitarianism and tens of millions dead.

Most of us don’t know it yet, but Australia is on a path to communism.

We have handed over the running of the country to a bunch of unelected health bureaucrats, and they are destroying it.

Modern Australia was built on the foundations of classical liberalism. At the same time as we were emerging from our convict-based economy, we imported the ideas and the thinkers that were emerging in Britain at the time. The ideas of Cobden, Mill, Bentham, Spencer, and Gladstone (to name a few) were discussed, debated, and worked into our founding constitution.

The general gist was that Australia would operate on the basis of these classical principles: the rule of law, the protection of private property, economic freedom, free trade, limited role of government, free speech, a free press, religious freedom, and the primacy of the individual to act in their own best interests and take personal responsibility for their actions.

The key role of government was to ensure that when individuals acted in their own self-interest, they didn’t harm others’ interests at the same time.

Different liberal thinkers had different views on how much the state should intervene to safeguard the vulnerable and ensure a relatively egalitarian society existed.

Australia benefited from the fact that most immigrants in the mid-to-late 1800s rejected Britain’s class divisions and prejudices. Given the immense material wealth of the land (given the capital to develop it), this ensured Australia was both very wealthy and shared this wealth better than nearly any other economy in the world at that time.

Almost from the start, socialists have tried to destroy this idea of a society based on individual freedom and responsibility. Their designs of utopia would be so much better if only it was ‘done this way’.

But the liberal tradition prevailed. It built an incredibly prosperous and resilient nation that succeeded despite the increasing deterioration of its political and ruling class.

In recent decades, as money has become ‘easier’, standards have slipped.

We’ve turned a blind eye to increasing political and bureaucratic incompetence because our house prices and super accounts have increased.

And those who’ve missed out turn to socialism…

And look where it has got us. Over 13 million locked in our homes based on an eradication strategy that will not work.

This insanity is best reflected in a tweet I saw yesterday:

‘Sydney registers 110 CV cases overnight after a record 84,000 tests. An infinitesimal 0.1% positive rate — unparalleled in the world. Yet Gladys warns harsher restrictions will be needed if numbers don’t drop. Priming us for lockdowns throughout August.’

Yet, seemingly, most of us are OK with this. I blame the media’s incessant fearmongering. Instead of taking a rational approach and calling the government out for its freedom-destroying absurdities, the media play along. And as Orwell wrote, ‘The people will believe what the media tells them to believe.’

Look, I’ve got no doubt this is a dangerous virus for some people. But it’s not so dangerous that you need to shut down the whole economy, destroy the basis of a liberal economy, and vaccinate the entire population (including kids!) with an experimental vaccine with varying efficacy…

There are no easy answers to getting through this. You’re going to piss off some people no matter what you do.

But when times are tough, you lean on your principles and go from there.

That hasn’t happened in Australia. Liberal governments (LINOs — Liberal in name only) have sold out to opinion polls driven by fear. Morrison’s government is the worst. It stands back and allows state governments to destroy economies and then picks up the tab.

Instead, we’ve ignored the principles that made Australia great. We’ve allowed unelected health bureaucrats to take the least risky path for their own careers, not yours. They will destroy the small business sector to save themselves.

The old adage was that public servants work for you.

But that no longer holds. You work for them. You are to do what they say to give them the best chance of re-election and to increase their grip on power. It’s perverse.

And they’re doing this through the fraudulent claim that this virus is so dangerous to our society that you cannot leave your home. But more and more people are seeing through this fraud.

The only question is, will our ruling class back down or, as Orwell wrote, rely exclusively on force to promote their agenda?

Regards,

Greg Canavan,
Editor, The Rum Rebellion

By Bill Bonner Editor, The Rum Rebellion

The trip on the ferry passed agreeably. The sea was still and smooth…almost like a glass tabletop. We sailed along nicely, not noticing any motion.

Arriving in France yesterday morning, we drove down to the Pays d’Auge to spend the night with friends.

‘You’ve come at a bad time,’ said Jean-Paul.

‘France is finished. Over. The country is run by criminal morons…it’s a disaster.

‘I think they [he was talking about France’s political class…but his comments could easily be applied in the US as well] just want to control everything. They don’t want us to go anywhere or do anything. Everything is either prohibited or compulsory.

‘And they think they can make up for the loss of revenue with money from Brussels [from the European Central Bank].’

Dead industry

‘And this “Sanitary Pass” is the worst yet. It’s scheduled to go into effect in September. You’ll need to show the pass to do anything. And if you don’t want to be vaccinated…or just don’t want to get the pass…you’ll be completely isolated.

‘In France, tourism is a major industry. It’s important, and not just for the money. It’s part of what we are…what we do. But tourism is dead.’

Jean-Paul owns a hotel in Paris.

‘The hotel has been closed now for 18 months. That’s a whole year and a half of revenue that is gone forever.

‘People say “You can make it up later.” But that’s crazy. I only have so many rooms. There’s no way to make up lost revenue. At best, I’ll be able to go back to earning a normal amount of revenue. But I’ll never get back what was lost.

‘And the hotel is going to stay closed until next April. There’s no point in opening now. The Americans aren’t coming.

‘I’m lucky. I’ve owned the hotel for many years. I don’t owe money on it. I can just hunker down. A lot of the old hotels in Paris are like that.

‘But anyone who bought a hotel recently…or owes money on it…he’s dead. Broke.

‘Same for the restaurants. There are thousands of restaurants in Paris. They depend on tourists. Without tourists, they have no business.

‘Those who have been around for a long time can afford just to close the doors. But the young guys…who had to borrow money…or pay rent…they’re in big trouble. The government gives them money now…but how long will that last?’

Scam

‘I’m glad I’m retiring…I just don’t want to deal with it anymore. I hate the face masks.

‘And, you know, it all just seems like a scam. I got the coronavirus last year. I’ve got high blood pressure and diabetes. I’m 65. And I’m overweight. But it just felt like the flu. My wife had it, too, and didn’t even know she had it.

‘And look, tuberculosis, malaria, auto accidents — they kill millions of people every year…and they’re all preventable. But nobody says we should stop everything because of them.’

Jean-Paul gave a weary, gallic shrug. He lives well in the Normandy countryside, but worries about how his children and grandchildren will make out.

‘I know I complain about everything…but the real problems haven’t even begun. Just wait until all this money printing catches up to us.

‘I’m old enough to remember the “old franc” when I was a child. Then, the new franc. And then, the euro. That’ll go away, too.

‘But I don’t know if I’ll still be around to see it.’

Rebound

Meanwhile…back in the US…MarketWatch announces with great relief, ‘Dow ends up more than 500 points, recovers from slump Monday’:

‘S&P index sees largest one day percentage gain since March 26, 2021.’

Explaining what had gone wrong on Monday was Art Hogan, a ‘chief market strategist’ at B Riley National:

‘Markets have a way, particularly in the middle of the summer, to price in the worst-case scenario pretty quickly.’

Hmmm…does Mr Hogan really think a 725-point Dow sell-off was the worst-case scenario?

By our reckoning, we would need to sell off 10,000 points to get stock prices back to a ‘normal’ price range. In a crash, 15,000 or 20,000 Dow points might disappear.

Tomorrow’s trouble

But investors must have realised that there is no way the Federal Reserve will permit a genuine sell-off. Not if it can help it.

So, at least for now, tomorrow’s trouble is still today’s fun.

Delta variant? Don’t worry about it.

Debt? Who cares?

Inflation? Hey…it’s just ‘supply chain disruptions’.

High stock prices are no virtue. And keeping them inflated is no great achievement, it merely puts off the day on which they are properly priced.

But a sell-off would end the fun, wouldn’t it? And isn’t that the one and only purpose of Fed policy today — to delay the inevitable reckoning? To inflate now…and die later…and laissez les bons temps rouler in the meantime?

Party on

And here, we turn to economist Ken Rogoff for an explanation of why even higher inflation rates should not stop the party:

‘Because the US Treasury and the Fed stepped in so quickly and proactively, there were actually fewer corporate bankruptcies in 2020 than in 2019.’

Mr Rogoff notes that bankruptcies usually rise during a recession.

Last year was the worst economic setback for the US economy since the Great Depression. Businesses that couldn’t pay their way should have closed shop.

Instead, they got money from the Fed…and are still losing money!

Whoopee!

In an honest economy, stocks go up and down…and businesses come and go. Some people get lucky. Some get smart. And all get more or less what they deserve.

In today’s economy, the zombies get infusions…households get stimmy cheques…the stock market gets pumped up…

…real losses are papered over with fake money…

…and the party continues…until it ends.

Regards,

Bill Bonner,
For The Rum Rebellion