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The 10 Wealthiest Members of Congress.


If you stayed up nights wondering whether members of Congress would be able to weather the Great Recession of the late 2000s, this bit of news should finally put your mind at ease.

Overall, members of Congress saw their personal wealth grow by more than 16 percent during the worst economic downturn in the United States since the Great Depression, according to financial disclosures submitted by lawmakers.

See more: Even in Recession, Congress Pay Grew

The median personal wealth for members of Congress grew to $911,510 in 2009, up from $785,515 in 2008, according to the Center for Responsive Politics. Nearly half of the members of Congress are millionaires.


Who are the wealthiest members of Congress? Here's a look.

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Question: What is the Great Compromise?

Answer: Two plans were put forth during the Constitutional Convention to create the new branches of government. The Virginia Plan wanted a strong national government with three branches. The legislature would have two houses. One would be directly elected by the people and the second would selected by the first house from people nominated by the state legislatures. Further, the president and national judiciary would be chosen by the national legislature. On the other hand, the New Jersey Plan wanted a more decentralized plan amending the old Articles yet allowing for a somewhat stronger government. Each state would have one vote in Congress.

The Great Compromise combined these two plans creating our current legislature with two houses, one based on population and elected by the people and the other house allowing two senators per state being appointed by state legislatures.

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December 18, 2011


FED's Printing Press to the 'Rescue'

Posted by Michael S. Rozeff on December 18, 2011 07:20 AM


The weekly FED report ending Dec. 14 shows a highly unusual one-week increase in Reserve bank credit of $69 billion. Most of this, $52 billion, is accounted for by central bank liquidity swaps (dollars for euros and later on euros for dollars when the swap is unwound). This follows upon the earlier announcement of the swap extension and expansion. This is "rescuing" some banks and governments in Europe. It's not really a rescue. It's more like a temporary propping up. It's sort of like infusing some blood in the hope of buying time so that the patient can recover; but unlike blood that itself does some good, printing more dollars does no good. It doesn't resolve anything. It builds UP the financial problems. Manufacturing more money and loans to prop up bond markets and insolvent banks is a sure losing strategy. So are tax increases to make people pay for debts that should be defaulted. More money printing is the least effective fix.

The next level of fix, which is much more powerful, is defaults. The system cannot recover without writing down and writing off debts. Banks have to go out of business. Debts, banks, and whole governments need to be restructured. This level of fix is not in view, but it will happen eventually. In America, we could use a massive chop in the federal and state governments, combined with massive tax decreases at both levels. We could use sound money and stable property rights. We could use open markets. These lead into the higher levels of fix that involve changing the size, nature, and functions of government

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Just Who Is Ignorant About Money?
by William L. Anderson

Recently by William L. Anderson: Tyranny and the Rule of Prosecutors



  
    
Gee, hoodathunkitt? Paul Krugman hates Ron Paul. It is not enough for Dr. Paul to want to leave abortion to state legislatures (where the U.S. Constitution would place it), but the very fact that Dr. Paul is personally opposed to abortion and would not perform one is enough to send Krugman into a rage.

Furthermore, Krugman attacks Dr. Paul on the matter of civil rights. Now, keep in mind that Dr. Paul is not against civil rights per se, given that no other person on the scene, Democrat or Republican, that is running for president that openly opposes the police state that both parties have created. (Sorry, Krugman. One cannot support both civil rights AND a police state. So, who is against civil rights?)

Anyway, Krugman is not referring to Dr. Paul's views on race, but rather Dr. Paul's view of the 1964 Civil Rights Act. Like all Progressives, Krugman holds that any law or regulation that is created in the name of something like civil rights is in itself the very essence of those rights. As Frederic Bastiat wrote in The Law in 1848, socialists (and I should add, Progressives) always couched beliefs within a specific government action:

Socialism, like the ancient ideas from which it springs, confuses the distinction between government and society. As a result of this, every time we object to a thing being done by government, the socialists conclude that we object to its being done at all.


We disapprove of state education. Then the socialists say that we are opposed to any education. We object to a state religion. Then the socialists say that we want no religion at all. We object to a state-enforced equality. Then they say that we are against equality. And so on, and so on. It is as if the socialists were to accuse us of not wanting persons to eat because we do not want the state to raise grain.

Likewise, according to Krugman, the only reason one could oppose sections of the Civil Rights Act which give government huge swaths of control over private property is racism. (Likewise, if one thinks that ANY environmental regulation is bad or unnecessary, then one is in favor of having feces wash up on beaches, to paraphrase Anthony Lewis, who also wrote his columns at the NYT.)

But Krugman was only getting warmed up when he accused Ron Paul of being a racist and a misogynist. (And why else would one be opposed to abortion than out of hatred for women? Gloria Steinem has declared such, and so it is an established truth, at least at Princeton University and the NYT.)

Ron Paul, writes Krugman:

...(ignores) reality, clinging to his ideology even as the facts have demonstrated that ideology’s wrongness. And, even more unfortunately, Paulist ideology now dominates a Republican Party that used to know better.

Given the open opposition that Republican stalwarts have exhibited toward Dr. Paul, the idea that his "ideology" is dominating the GOP is a very sick joke, but Krugman seems to be full of humor these days. Unfortunately, he totally misstates the position that Austrians have on money, and he further writes that all Austrians believe that the monetary base is exactly the same as money that is circulating.

First, as he points out in the article, the Fed massively increased the monetary base and some Austrians have said that sooner or later if that base is turned into large-scale lending, we are going to have inflation. That is a no-brainer. However, because some Austrians have said that maybe inflation will occur sooner rather than later, according to Krugman, that means that all Austrian theory on money is wrong. (This is what the ancients once called a non sequitur, but without the non sequitur, Krugman would not have any columns.)

Second, Krugman continues in that insistence:

Austrians, and for that matter many right-leaning economists, were sure about what would happen as a result: There would be devastating inflation. One popular Austrian commentator who has advised Mr. Paul, Peter Schiff, even warned (on Glenn Beck’s TV show) of the possibility of Zimbabwe-style hyperinflation in the near future.

So here we are, three years later. How’s it going? Inflation has fluctuated, but, at the end of the day, consumer prices have risen just 4.5 percent, meaning an average annual inflation rate of only 1.5 percent. Who could have predicted that printing so much money would cause so little inflation? Well, I could. And did. And so did others who understood the Keynesian economics Mr. Paul reviles. But Mr. Paul’s supporters continue to claim, somehow, that he has been right about everything.


Austrians are not shocked at what has transpired. The economy, thanks to the bailouts, explosion of regulations, and incendiary rhetoric from the White House, is mired in depression, just as Austrians predicted it would be if the policies of the past four years were followed. As long as the monetary base remains just that – a base – and the money does not circulate, the official rate of inflation will be low. What I do find interesting, however, is Krugman's insistence that commodity prices have nothing to do with inflation, that the only reason they rise and fall is because of demand from "emerging economies" and "volatility." (Of course, "volatility" is an effect, not a cause, but since Keynesians regularly confuse cause and effect, we should not be surprised at Krugman's conclusions.)

You see, if Austrians are wrong in their belief that an expansion of money in circulation will force up prices (and that is what Krugman insinuates), then all of monetary theory is turned upside down. For that matter, Krugman already is on the record in calling for the Fed to directly purchase U.S. Government securities on the primary market, which in essence would be financing government via the printing press. Does Krugman also believe that such an action would not have a huge effect upon prices of goods, or does he want us to believe that any predictions of inflation here would be wrong?


Krugman's insistence that Austrians are ignorant about money is, well, ignorant. Austrians say that money is a secondary good which has a primary use to facilitate exchanges, and its productivity exists in the fact that it allows exchanges to occur that would not happen in a barter economy. Austrians further hold that money is subject to all of the laws of economics, including the Law of Marginal Utility (no, we don't hold that it simply is a quantity variable).

However, one of the most important aspects of Austrian thinking on money is that Austrians emphasize the transmission mechanism of new money being injected into the economy, and that transmission is non-neutral, for those receiving the new money first will be able to pay for goods at the old prices, but with new incomes. This view contrasts with the Keynesian viewpoint that monetary transmission is neutral, and that the only thing which matters is that money get put into the economy so that someone can spend it.

Moreover, Austrians also point out that the injection of new money into the economy also will have an effect upon the relative prices of goods, and that the relations will change as more money pours in. This contrasts with Krugman's view that new money has no such effect, and that everyone benefits equally from monetary injections. (In Krugman's view, while inflation benefits debtors at the expense of creditors, that is OK because he falsely assumes that all creditors are the "one percent" and that all debtors are in the other category.)

So, because hyperinflation has not hit, Austrians are totally ignorant about money, and that includes Ron Paul. We are dealing with timing, not monetary theory, and Krugman by confusing the former and latter, demonstrates his own ignorance about monetary matters.

December 17, 2011

William L. Anderson, Ph.D. [send him mail], teaches economics at Frostburg State University in Maryland, and is an adjunct scholar of the Ludwig von Mises Institute. He also is a consultant with American Economic Services. Visit his blog.

Copyright © 2011 by LewRockwell.com. Permission to reprint in whole or in part is gladly granted, provided full credit is given.