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Take Cover—–Now Comes The Gong Show

by David Stockman • February 10, 2016



It was a bad hair night for the Beltway. Among the roughly 515,000 votes cast in the New Hampshire primaries, about 55% or 280,000 went to Bernie, the Donald and Senator Cruz. That is, the preponderance of Republican, Democrat and independent votes alike went for the anti-establishment candidates.

Since the latter are basically campaigning against the Imperial City and all of its careerists, cronies and corruptions, the first impulse is to cheer them on. After all, nothing could be worse than the self-perpetuating gang of war mongers, welfare statists, K-Street lobbyists and pork-barreling politicians who rule the nation today from their permanent berths in Washington DC.

Unfortunately, there is something worse. When you combine the mindless raw populism of Bernie and the Donald with the rapidly advancing lunacy and desperation of Janet and her baleful band of money printers you have a combustible recipe for abrupt system failure. American capitalism and democracy as we have known it could blow sky high by the time this election cycle is complete and a new President settles into office.

Before elaborating on that dismal note, however, let me first dispatch with Senator Ted Cruz. He unfortunately has the Ronald Reagan mutation when it comes to his political genome. I admire his resolute opposition to Big Government at home and his demonstration in Iowa that you can standup to a big, thieving special interest group like the Ethanol Lobby, and still win elections.

On that score, I recall my third election to Congress in 1980 from a small town district in Michigan. Even though it was a hotbed of Chrysler supplier plants and evangelical right-to-lifers, I helped lead the charge against the Chrysler bailout on the House floor and voted against the Hyde anti-abortion amendment dozens of times, thereby earning the wrath of Chrysler CEO Lee Iacocca in Detroit and the so-called pro-life lobby in Washington.

As it happened, I also got 70% of the vote in that election, and a real chance—in theory—-to take on the Leviathan when I shortly thereafter joined Ronald Reagan’s team in the White House. But, needless to say, it never happened; and for the same reason that Ted Cruz is destined to fail.

To wit, Reagan was a one-armed anti-statist who couldn’t get enough Big Government on the Pentagon side of the Potomac. Indeed, it was his massive and completely unnecessary build-up of the US conventional force armada——ships, planes, tanks and cruise missiles—–capable of power projection and wars of invasion and occupation, as opposed to strategic nuclear deterrence of the rotting Soviet Empire, that paved the way for the Bush Dynasty’s destructive wars in the middle east.

Now after 25 years of interventionist meddling, military mayhem and raining death from the skies on millions of citizens from Afghanistan to Libya, we are confronted with Washington-fostered failed states in Iraq, Syria, Yemen, Libya, Somalia, Egypt and elsewhere, and the resulting jihadist blowback and sectarian violence across most of the region.

Yet instead of learning a lesson from this abysmal and destructive policy of failure like Ronald Reagan did when he bugged out of Lebanon, Senator Cruz wants to dramatically increases the defense budget and make the deserts glow in the dark.

Worse still, he takes his foreign policy counsel from two neocon fanatics, Elliot Abrams and James Woolsey, whose policy history is so sordid that they might as well be considered war criminals. So you can’t give Senator Cruz a pass on his foreign policy jingoism and huffing and puffing about border security and terrorist hobgoblins allegedly stalking the land on the grounds his is just trying to win the election.

As Ron Paul pointedly told a reporter last week, the Texas Senator is a Warfare State neocon at heart who would end up perpetuating the Big Government status quo in order to feed the beast on the Virginia side of the Potomac. Even though I agree with him that gold is real money and that the Wall Street casino has become the enemy of honest capitalism, there is no point in Reagan Redux. And beyond that, at least the Gipper was not coming from a place of anger and kept his religion to himself.

Beyond Ted Cruz, however, the anti-establishment campaign is a horror show. Even as the nation endured FDR’s New Deal and Truman’s Fair Deal in the last century, it would now have to face Bernie’s Scary Deal and The Donald’s Hairy Deal this time around.

As to Bernie, what you hear is what you get. To wit, unadulterated statism and redistributionism that would be the death knell for what remains of American prosperity and capitalism. But the Sanderista campaign is rooted in irony.

It is gaining surprising traction on the claim that the economy is rigged in behalf of the 1% and Wall Street, and that’s actually correct. But this baleful reality is not owing to the inherent tendencies of unregulated capitalism, as Bernie contends; it arises from the very opposite. Namely, the Fed’s destruction of honest price discovery in the financial markets.

Needless to say, there is not a chance in the world that a Sanders Administration would rein-in the Fed. Nor would it eliminate its endless free money subsidies to Wall Street gamblers and cheap debt extensions to the C-suite financial engineers who are strip-mining the balance sheets of corporate America in order to goose their stock prices and options winnings.

It’s hard to imagine, but under Bernie’s Scary Deal, the Fed would likely go straight into the helicopter drop business, dispensing cash based on social security numbers. Then we would have real QE for the people—–until the whole financial system imploded, and not before long.

That brings us to the Hairy Deal. There is no redeeming virtue in The Donald’s candidacy, even if he talks up a populist-sounding storm and rebukes Imperial Washington with the insolence it richly deserves. That’s because Trump is a rude, crude bag of wind who thinks the nation’s ills stem from incompetent politicians making bad deals.

No they are not, and no it doesn’t!

The problem is bad policies and destructive ideas in the hands of politicians who are extremely competent at orchestrating the machinery of the state against the liberty and prosperity of citizens who once enjoyed the fruits of a robust capitalism and a free society.

Thus, in the hierarchy of things screaming out for radical change, NAFTA, China’s trade practices, illegal aliens and the danger of Muslim refugees don’t even rank. Nor do safeguarding the Second Amendment or building a horizontal version of Trump Towers on the Rio Grande.

The fact is, Trump has fashioned his platform by opportunistically scratching the most fearful and bigoted itches roiling the electorate. He has absolutely no semblance of a coherent program——or even an incoherent one for that matter.

Instead, his pitch is comprised of pure bombast and bile based on the exceedingly dangerous proposition that what Washington needs is a smart deal maker who can make the government run better at home and foreign leaders run for cover abroad.

Source: http://davidstockmanscontracorner.com/take-cover-now-comes-the-gong-show/