Economy: Can't afford this nonsense

The Growth Stock Wire
Weekend Edition

Stansberry to Obama:
'We simply can't afford this nonsense anymore…'

Saturday, April 23, 2011

In honor of Monday's national Tax Day, I wrote the following letter to Mr. Barack Hussein Obama. Please feel free to pass this around if you like it…

Dear Mr. President,

Welcome to the ashbin of society.

With the speech you gave last week, you have firmly and permanently put yourself in the same garbage bag as all the other communists and socialists of the 20th century.

Your speech sounded like the faint echo of a speech Lenin gave in an icy square in Moscow 100 years ago.

The promises you made, Mr. President, about the government giving people things they can't provide for themselves – a better income, reliable health care, an advanced education, cheaper mortgages, a "shiny, happy" life – have been made time and time again… sometimes by speakers even better than you.

And they have always been lies.

While the government can demand obedience (and taxes), it can't mandate dedication, creativity, or innovation. The fact is, the government itself is nothing more (or less) than the organized ambitions of the people.

Promising something to the people that they don't already have is a logical absurdity. And therein lies the timeless flaw of all collectivist theory: Governments cannot deliver benefits to the people that the people cannot deliver to themselves.

To demonstrate this truth, consider this example… Governments cannot simply mandate higher tax revenue. Any substantial increase to tax rates will reduce total collections, an economic phenomenon known as the "Laffer Curve."

This has been proven countless times in our country and many others. Any sensible person will immediately understand why. Taxes are a disincentive. The higher the marginal rate of tax, the more powerful its impact.

That's why, over many decades (and many different tax structures), U.S. tax revenues have been remarkably stable at around 20% of GDP. That's why, as you surely know, Mr. President, changing the tax code will not result in increased tax revenue.

Taxing only the rich simply doesn't work. It never has. And it never will. To increase the government's revenues, we must first increase the size of the economy. The government cannot tax what the economy doesn't produce.

In another time, most Americans might have simply ignored your speech as the ignorant remarks of yet another handsome, Ivy League-educated, dilettante president. But at this point in our history, my bet is people are going to take you far more seriously than you expect. In fact, I think you're going to get what you deserve – the trash heap. Why will Americans turn on you so rapidly and so completely?

Two things have changed – forever – about American politics.

The first is the media and access to critical information. It's no longer possible for a president's administration to control what people read, see, and think by simply managing the evening news broadcasts.

Thus, all your lies are now exposed almost instantly and broadcast to millions of people via websites and services like the Drudge Report, Twitter, and Facebook. Socialism cannot possibly survive over any long period of time in a society with a free media – because socialism is based on a lie. Facebook means the "half-life" of socialism is now weeks instead of years.

Even mainstream publications like the Wall Street Journal have called you a liar recently. They have no choice. Your lies were broadcast to the entire world long before their op-ed pieces appeared.

Your advisors told you none of these "bloggers" mattered. All you had to do was promise more benefits to more voters and then force fewer voters to pay for it all. I'm sure you did the political calculus… You believed your power to bribe and bamboozle the poor and the ignorant was stronger than the resentment you'd engender among the "rich." And I must admit… since at least World War II, that's been a safe bet in American politics.

But you forgot one critical factor: We simply can't afford this nonsense anymore…

Immediately after your speech, the price of silver went from $39 to a new high above $42. Gold went up, too.

These are signs, Mr. President, that the world is losing confidence in our currency. If our foreign creditors were to call in our debts, America would suffer an economic cataclysm unlike anything we've ever seen in our entire history.

Americans now owe a total of $56 trillion. Without the Fed's money-printing, it's unlikely we could afford even the interest on these existing debts… much less the $1.5 trillion or more in debt you continue to rack up year after year by promising benefits we haven't earned.

Sooner or later, our foreign creditors are going to decide our money-printing amounts to a default, and they will stop buying our bonds. On that day, everyone who trusts you, everyone who believes in your lies, will be wiped out.

But that won't be as many people as you expect.

Almost every American knows in his heart what made this country great for the 200 years between 1776 and 1976. It wasn't the lies of our presidents. It wasn't our ability to print money and rip off our Chinese creditors. It wasn't the modern crybaby mentality of our school system or our unions. It wasn't the baby boomer's dream of a 40-year retirement with free prescription drugs.

And it sure as hell wasn't a suave, made-for-TV version of Karl Marx promising everything to everyone, but with no way to pay for it.

No. What built America was her people's unwavering faith that they were free to enjoy the rewards of their accomplishments.

As our country tumbles into bankruptcy and crisis, the people are going to want their prosperity back, Mr. President. And deep down, they all know… even your most fervent supporters know… you don't have the goods. You don't have the foggiest idea of how to deliver prosperity to America because, really, you don't understand what America is all about.

Regards,

Porter Stansberry

With today's essay, I am announcing my complete support for "the rich" – the class of people Mr. Obama and his ilk castigate at every opportunity. Ironically, it is these same people Obama expects to line up like sheep waiting to be sheared. My best advice? Don't get in that line.

Despite what Mr. Obama and his vast team of lawyer buddies, career academics, and professional bureaucrats believe, most "rich" people in America got that way by working hard for a long time. They got that way by taking risks, educating themselves, starting small businesses, and selling valuable services or products to their fellow citizens. They didn't inherit their wealth. They didn't rip anyone off. They didn't buy political favors from people like Barack Obama.

They got that way by working hard to achieve the original American Dream… not Obama's new "progressive" American Dream, where everyone can live at the expense of his neighbor. That's why Obama's grandstanding must be viewed in a new way. We need to realize when Obama vilifies the "rich," he is vilifying the "achievers."

And keep in mind … these achievers are already paying their share. The top 5% of income earners in America pay nearly 60% of this country's income taxes. Click Here.

America needs the achievers. We need investment. We need capital. We need jobs and innovation and vast increases to productivity. The government can supply none of these things. So to do my part, I plan to support the achievers.

Like it or not, as deep in debt as we are, the achievers are our only hope. That's why I'm standing up for them. We need the achievers – and we need more of them to want to come to America with their corporations and their wealth. You might admire the generosity and egalitarianism of idealized socialism in some pseudo-intellectual way… But we can't afford that nonsense right now. We don't have enough wealth on a net basis left to plunder.

We need more of the people Obama and his gang of petty tyrants label "rich," "greedy," and "mean spirited." These are the people who can get our country moving in the right direction, right away. Folks who have spent their lives in the real world recognize the people Obama calls "rich," "greedy," and "mean spirited" as "successful," "accomplished," and "hard working."

Now … before you send me an angry letter, ask yourself this question: If America had the lowest corporate tax rate in the world (instead of the highest), do you think we'd have more companies located here, or fewer?

If we got rid of the estate tax, which makes it impossible for successful entrepreneurs to leave their companies to their children, do you think we'd have more family businesses, or fewer? And if we taxed all people at the same (hopefully low) rate, do you think more wealthy people from around the world would want to live here, or fewer?

What can I do for the achievers? For one, I can stand up for them and try to convince you, my dear readers, that we need them – and we need more and more of them. As such, we shouldn't treat them so badly or try to steal from them so blatantly. More directly, of course, I can also support them by telling them exactly what they can still do to get out of that shearing line…

In the coming days, weeks, and months, you will see more and more evidence of my support for the "rich." I plan to offer you more and more information about how to get your assets outside the reach of Mr. Obama and his ilk, including more ideas like buying foreign real estate (which is, in my view, the best way to get your assets out of the U.S. without having to report a thing to the U.S. government).

You'll find this information and other ways to protect yourself from the currency crisis in my newsletter, Stansberry's Investment Advisory. Click here to gain access immediately.

Regards,

Porter Stansberry

Editor's note: The Weekend Edition is pulled from the daily S&A Digest, produced by Stansberry & Associates. The Digest comes free with a subscription to any of our premium products. To learn more about our research, including a secret that made one of Porter's mentors $1.5 million over the past few years… despite being much safer than most investments… click here.

Ethanol

Food and Fuel prices moving together

We now pay fuel prices for our food

In 2005 and 2007 energy bills, Congress mandated that ethanol be incorporated into fuel blends.

13.5 billion bushels of corn expected to be produced in US in 2011.

Of that, ethanol will consume 5 billion bushels - 37% of the total.

Amount used for food is 1.1 billion - 8.3% of the total.

16% of US corn is exported.

Wonder why 13.5 ounces of corn flakes costs almost $4.00. Because we now pay "fuel prices" for our food. And, as the price of oil goes up, so do food prices because food is now on two price indexes.

American farmers are planting 92.2 million acres of corn this year. That is four million acres more than we planted last year... meanwhile our corn supply is nearing a 15-year low.

It takes 26 pounds of corn to equal one gallon of ethanol.

Almost 40% of America's corn crop last year went into the gas tanks of our cars, not in the dinner pots of American homes.

Cornell University found that it takes 140 gallons of fossil fuels to plant, grow and harvest 1 acre of corn, which is around 183 bushels. Once harvested, it takes even more fossil fuels to convert the corn into ethanol. Cornell concluded that it took more fuel to produce ethanol than ethanol would yield in return. They came to the same conclusion using switchgrass, wood, soybean, and sunflowers.

[Center for the Defense of Free Enterprise]

Book snapshot: Courting Disaster

WHAT THE CIA USED TO DO ... WORTH READING AND PASSING ALONG

COURTING DISASTER

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As President George W. Bush's top speechwriter, Marc Thiessen was provided unique access to the CIA program used in interrogating top Al Qaeda terrorists, including the mastermind of the 9/11 attack, Khalid Sheikh Mohammad (KSM).

Now, in his riveting new book, Courting Disaster, How the CIA Kept America Safe and How Barack Obama Is Inviting the Next Attack.

Here is an excerpt from Courting Disaster:

Just before dawn on March 1, 2003, two dozen heavily armed Pakistani tactical assault forces move in and surround a safe house in Rawalpindi. A few hours earlier they had received a text message from an informant inside the house. It read: "I am with KSM."

Bursting in, they find the disheveled mastermind of the 9/11 attacks, Khalid Sheikh Mohammed, in his bedroom. He is taken into custody. In the safe house, they find a treasure trove of computers, documents, cell phones and other valuable "pocket litter."

Once in custody, KSM is defiant. He refuses to answer questions, informing his captors that he will tell them everything when he gets to America and sees his lawyer. But KSM is not taken to America to see a lawyer. Instead he is taken to a secret CIA "black site" in an undisclosed location.

Upon arrival, KSM finds himself in the complete control of Americans. He does not know where he is, how long he will be there, or what his fate will be.

Despite his circumstances, KSM still refuses to talk. He spews contempt at his interrogators, telling them that Americans are weak, lack resilience, and are unable to do what is necessary to prevent the terrorists from succeeding in their goals. He has trained to resist interrogation. When he is asked for information about future attacks, he tells his questioners scornfully: "Soon, you will know."

It becomes clear he will not reveal the information using traditional interrogation techniques. So he undergoes a series of "enhanced interrogation techniques" approved for use only on the most high-value detainees. The techniques include waterboarding.

His resistance is described by one senior American official as "superhuman." Eventually, however, the techniques work, and KSM becomes cooperative-for reasons that will be described later in this book.

He begins telling his CIA de-briefers about active al Qaeda plots to launch attacks against the United States and other Western targets. He holds classes for CIA officials, using a chalkboard to draw a picture of al Qaeda's operating structure, financing, communications, and logistics. He identifies al Qaeda travel routes and safe havens, and helps intelligence officers make sense of documents and computer records seized in terrorist raids. He identifies voices in intercepted telephone calls, and helps officials understand the meaning of coded terrorist communications. He provides information that helps our intelligence community capture other high-ranking terrorists.

KSM's questioning, and that of other captured terrorists, produces more than 6,000 intelligence reports, which are shared across the intelligence community, as well as with our allies across the world.

In one of these reports, KSM describes in detail the revisions he made to his failed 1994-1995 plan known as the "Bojinka plot" to blow up a dozen airplanes carrying some 4,000 passengers over the Pacific Ocean.

Years later, an observant CIA officer notices that the activities of a cell being followed by British authorities appear to match KSM's description of his plans for a Bojinka-style attack.

In an operation that involves unprecedented intelligence cooperation between our countries, British officials proceed to unravel the plot. On the night of Aug.9, 2006 they launch a series of raids in a northeast London suburb that lead to the arrest of two dozen al Qaeda terrorist suspects. They find a USB thumb-drive in the pocket of one of the men with security details for Heathrow airport, and information on seven trans-Atlantic flights that were scheduled to take off within hours of each other:

• United Airlines Flight 931 to San Francisco departing at 2:15 p.m.;

• Air Canada Flight 849 to Toronto departing at 3:00 p.m.;

• Air Canada Flight 865 to Montreal departing at 3:15 p.m.;

• United Airlines Flight 959 to Chicago departing at 3:40 p.m.;

• United Airlines Flight 925 to Washington departing at 4:20 p.m.;

• American Airlines Flight 131 to New York departing at 4:35 p.m; and

• American Airlines Flight 91 to Chicago departing at 4:50 p.m.

They seize bomb-making equipment and hydrogen peroxide to make liquid explosives. And they find the chilling martyrdom videos the suicide bombers had prepared.

Today, if you asked an average person on the street what they know about the 2006 airlines plot, most would not be able to tell you much. Few Americans are aware of the fact that al Qaeda had planned to mark the fifth anniversary of 9/11 with an attack of similar scope and magnitude.

And still fewer realize that the terrorists' true intentions in this plot were uncovered thanks to critical information obtained through the interrogation of the man who conceived it: Khalid Sheikh Mohammed.

This is only one of the many attacks stopped with the help of the CIA interrogation program established by the Bush Administration in the wake of the Sept. 11, 2001, terrorist attacks.

Editor's Note: For other foiled terrorist plots, see page 9 of Courting Disaster.

In addition to helping break up these specific terrorist cells and plots, CIA questioning provided our intelligence community with an unparalleled body of information about al Qaeda.

Until the program was temporarily suspended in 2006, intelligence officials say, well over half of the information our government had about al Qaeda-how it operates, how it moves money, how it communicates, how it recruits operatives, how it picks targets, how it plans and carries out attacks-came from the interrogation of terrorists in CIA custody.

Former CIA Director George Tenet has declared: "I know that this program has saved lives. I know we've disrupted plots. I know this program alone is worth more than what the FBI, the Central Intelligence Agency, and the National Security Agency put together have been able to tell us."

Former CIA Director Mike Hayden has said: "The facts of the case are that the use of these techniques against these terrorists made us safer. It really did work."

Even Barack Obama's Director of National Intelligence, Dennis Blair, has acknowledged: "High-value information came from interrogations in which those methods were used and provided a deeper understanding of the al Qaeda organization that was attacking this country."

Leon Panetta, Obama's CIA Director, has said: "Important information was gathered from these detainees. It provided information that was acted upon."

And John Brennan, Obama's Homeland Security Advisor, when asked in an interview if enhanced-interrogation techniques were necessary to keep America safe, replied: "Would the U.S. be handicapped if the CIA was not, in fact, able to carry out these types of detention and debriefing activities? I would say yes."

On Jan. 22, 2009, President Obama issued Executive Order 13491, closing the CIA program and directing that, henceforth, all interrogations by U.S personnel must follow the techniques contained in the Army Field Manual.

The morning of the announcement, Mike Hayden was still in his post as CIA Director, He called White House Counsel Greg Craig and told him bluntly: "You didn't ask, but this is the CIA officially non-concurring. The president went ahead anyway, overruling the objections of the agency.

A few months later, on April 16, 2009, President Obama ordered the release of four Justice Department memos that described in detail the techniques used to interrogate KSM and other high-value terrorists. This time, not just Hayden (who was now retired) but five CIA directors -- including Obama's own director, Leon Panetta -- objected. George Tenet called to urge against the memos' release. So did Porter Goss. So did John Deutch. Hayden says: "You had CIA directors in a continuous unbroken stream to 1995 calling saying, 'Don't do this.'"

In addition to objections from the men who led the agency for a collective 14 years, the President also heard objections from the agency's covert field operatives. A few weeks earlier, Panetta had arranged for the eight top officials of the Clandestine Service to meet with the President. It was highly unusual for these clandestine officers to visit the Oval Office, and they used the opportunity to warn the President that releasing the memos would put agency operatives at risk. The President reportedly listened respectfully-and then ignored their advice.

With these actions, Barack Obama arguably did more damage to America 's national security in his first 100 days of office than any President in American history

Who is looking out for you?

Is John Boehner [R-OH] looking out for us or is he just another ruling class Republican who wants to be included in the circle with the real ruling class Democrats? It is hard to tell at this time.

Gas prices up. Tax. Refineries.

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Gas prices in some areas are approaching $5.00 per gallon in April 2011
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Big Gov Federal Tax on gasoline is 18.4 cents per gallon. Then tack on state taxes ranging from 8 cents a gallon in Alaska to 47.7 cents in California. Then add the federal tax of 18.4 cpg for a total of 67.1 cents per gallon for Californians. It is even worse for diesel at 76 cpg.

US average for state excise/sales taxes on gasoline is 29.7 cents per gallon.

How much did the evil Sunoco, Exxon, BP corporations make on that gallon of gas? Between 8 and 10 cents per gallon (refinery fees if any not included).

There has not been a new oil refinery built in US since 1976. 35 years! The last one built was in Garyville, Louisiana. In 1975 there were 137,912,779 vehicles on the road in America. By 2008 this number had grown to 255,917,664, an increase of 85%, yet no additional refineries have been built. In fact, there are only 149 oil refineries in the US today, down from over 300.

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Gasoline prices were down in June 2010.

I have noticed that the price of gasoline at the pump has dropped recently.

Do you suppose that Obama has cut some kind of back room price deal with the Middle Eastern oil cartels to boost his sagging popularity.

Oh. No. He would not do that.

But wait. There were wild accusations by the Big Time Democrat Reporters that George Bush 43 had done this very thing while President.

Still, you know what is going to happen if the Democrats pass Cap and Trade. Remember this is based on the Democrat global warming scan.

Health care updates

Obama Care "might" work once insurance companies are not permitted to provide coverage and if Big Gov does not have to provide health care to seniors [a moving age] or people with low risk of surviving their aliment [not the same as no risk or moderate risk]. =trj

1,168 Obama health care waivers given to businesses, health care plans, unions and others = about 3 million workers, ½ are in unions. 4/3/11

Over federal 1300 grants to companies big and small, designed to help them fund health coverage for early retirees.

Click Here for Health care law waivers. 4/2/11

More ObamaCare waviers. 126 new waivers now total 1,040. Among the shoe-string budget firms that can’t afford to meet Obamacare requirements are Teamsters Union, United Food and Commercial Workers International Union, International Brotherhood of Electrical Workers, Communications Workers of America, Service Employees International Union, and Robert Wood Johnson Foundation, which counts among its board members Obamacare Czar Nancy-Ann DeParle. 3/7/11

40% of those who are exempt from ObamaCare are union members.

Sources not credible for verification

Ever wonder Why Obama recommended Kagan for the Supreme Court?

Word was that she defended the cases involving "the birth certificate" ...

In our Search For The Truth Department, we find what I have suspected on many occasions. I went to Snopes to check this out and they said it was false and there were no such dockets so I Googled the Supreme Court, typed in Obama-Kagan, and guess what? Yep you got it.

Snopes lied. Everyone of those dockets are there.

So Here is what I wrote Snopes:

Referencing the article about Elena Kagan and Barak Obama dockets: The information you have posted stating that there were no such cases as claimed and the examples you gave are blatantly false. I went directly to the Supreme Court�s website, typed in Obama Kagan and immediately came up with all of the dockets that the article made reference to.. I have long suspected that you really slant things but this was really shocking.

Thank You, I hope you will be much more truthful in the future.

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That being said, I will bet you did not know this.

Kagan was representing Obama in all the petitions to prove his citizenship. Now she may help rule on them. Folks, this is really ugly.

Chicago Politics; and the beat goes on and on and on...

Once again the US Senate sold us out! Well, someone figured out why Obama nominated Elana Kagan for the Supreme Court. ... Pull up the Supreme Court website, go to the docket and search for Obama.

She was the Solicitor General for all the suits against him filed with the Supreme Court to show proof of natural born citizenship. He owed her big time. All of the requests were denied of course. They were never heard. It just keeps getting deeper and deeper, doesn't it? The American people mean nothing any longer. It's all about payback time for those who compromised themselves to elect someone that really has no true right to even be there.

Here are some websites of the Supreme Court Docket: You can look up some of these hearings and guess what? Elana Kagan is the attorney representing Obama!

Check out these examples:

http://www.supremecourt.gov/Search.aspx?FileName=/docketfiles/09-8857.htm

http://www.supremecourt.gov/Search.aspx?FileName=/docketfiles/09-6790.htm

http://www.supremecourt.gov/Search.aspx?FileName=/docketfiles/09-724.htm

If you are not interested in justice or in truth delete this. However, If you hold sacred the freedoms granted to you by the U.S. Constitution by all means, please PASS it ON!

There truly is tyranny afoot. - - - Dennis Staer

Note from the right jack. There are two sources in particular that are not credible when searching for information on the web. [1] Snopes. [2] Wikipedia. Both manipulate information so that it looks accurate.