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To understand why, readers need only consider the 2nd stage result of any individual decision to save at the alleged expense of consumption.  If those who choose not to consume deposit the money in a bank, their decision to save powers consumption every bit as much as it would if they chose to spend every dollar in their control.  That’s the case given the basic truth that banks don’t pay for deposits so that they can stare lovingly at the dollars deposited.  If they did, hoarding banks would soon be insolvent, acquired by another bank, or both.

What this should remind readers is that no act of saving (short of hiding one’s extra disposable income in a safe) ever subtracts from consumption.  For an individual to save is for that individual to merely shift the ability to consume into the hands of someone else with near-term consumptive desires.

What this ideally indicates to readers is that production is all that matters when it comes to economic growth.  If we’re producing we’re consuming.  Simple as that.  The only non-question from there is whether we’re producing with an eye on our own near-term consumption, or with an eye on saving that will boost the consumption of others who access our savings.  It’s a non-question simply because it amounts to a distinction without a difference.

Applied to Lahart, correct analysis by the consumption-focused columnist would concern the removal of barriers to the very production that powers all demand.  If so, Lahart might note that taxes are a price or penalty placed on work that have the potential to shrink one’s desire to produce.  The columnist would also logically cast an eye toward regulations that don’t achieve much (see: banking, 2008), but that distract those engaged in the production of goods and services.

Taking this further, trade is the purpose of all production.  We produce so that we can get what we don’t have, so tariffs amount to a tax on the production that powers all consumption.  Lastly, Lahart might check the stability of the unit that facilitates consumption; in our case the dollar.  If it’s floating without definition, it’s less useful as a medium of exchange; thus rendering trade less likely.  In short, those desirous of more production would logically seek the reduction or removal of the tax, regulatory, trade and monetary barriers that lay a wet blanket on the production that is the source of all economic growth.

They should also ignore consumption simply because consuming is the easy part.  What we call an economy is just individuals producing with an eye on getting.  As human beings our wants are endless.  That’s why we produce in the first place.

Back to Lahart, his column assumes that if Americans just purchase enough cars, that the economy will be just fine.  He adds that if they don’t, the economy will be weak unless they “buy other things instead.” His analysis misses the essential 3rd stage result of saving; one that trumps the 2nd stage by a mile.

Interesting about all this is that while Lahart confidently asserts that the purchase of cars will power growth, he blithely ignores that we only have quality cars to buy thanks to the decision of producers long ago to forego consumption in favor of investment.  Lest we forget, no less than Wilbur Wright believed as the 20th century dawned that cars would never be broadly owned owing to their extreme unreliability.  In that case, thank goodness for savers.  As has been well documented in this column over the years, savers backed thousands of car companies in the early part of the 20th century that mostly failed.  But thanks to intrepid saving driven by production, what seemed impossible became a reality.

Notable here is that Wright was half of the Wright Brothers duo that disproved the consensus that man would never fly.  The Wrights luckily saved some of their earnings from a bike shop they owned, and their savings funded feverish experimentation which led to flight that, like the automobile, utterly transformed the global economy for the better.  What this ideally reminds readers is that when individuals produce with an eye on directing some of the fruits of their production into investment, technological advances that exponentially increase our productivity are the result.

Indeed, imagine what our economy would look like today if producers of the past had bought into Keynesian thinking only to spend all that they earned.  If so, the economy of today would be a slow-growth fraction of its abundant present.  We’re wildly productive today to the economy’s productive betterment precisely because producers delayed always easy consumption in favor of investment.

Of course, that’s why Justin Lahart’s commentary on the economy of the present is so disturbingly obtuse.  Limited in vision to less than the 1st stage of economic activity, he doesn’t see that his analysis in favor of rampant consumption, if followed, would author exponentially slower growth in the present and future thanks to reduced investment in the technological advances necessary for huge productivity increases.  Thanks to past savings in the 20th century, we now have the car, airplane, computer and internet in the 21st.  Unseen, assuming individuals actually abide Lahart’s analysis, is what we would lack to our extreme economic detriment in the 22nd century thanks to rampant spending limiting investment in new ideas in the 21st.

To say that consumption really doesn’t matter is ultimately to miss the much greater, booming growth point.  Consumption will always be evident so long as individuals are producing.  But if individuals continue to forego some or a lot of consumption in favor of investment, just imagine how much more advanced the U.S. economy will be in the future, and with this advance, just imagine how much more the hyper-productive of tomorrow will be able to consume.  In short, the answer to economic growth is to ignore the economists, along with the columnists who think like economists do.

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Which looks to be headed lower over the next few days at least.

This is the first opportunity I have had to look at the market for about 1 week. I have been busy moving house. This is a very tiring and stressful undertaking. Chaos reigns. At the moment mostly everything is still packed in boxes.

As to the market, overall, it would seem to have lost upside momentum and now will have a period of weakness. Having quickly looked at the various commentary around, much is attributed to Trump etc. Also mooted is the high P/E ratio etc, with market near all time nominal highs.

If already long, stay long and ride out the volatility. If not in the market, this could provide an entry point. I would not be short, unless you can manage the position on a daily basis. I think the ‘shorts’ will have some time to make a bit of money, but if the market turns higher, then it will likely move higher with higher volatility.

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1. The Iron Lady never backed down.

Not true. Her genius was her gift for choosing her battles wisely and avoiding those she couldn’t win. In 1981, for example, the National Union of Mineworkers — Britain’s most powerful union — threatened to strike.

Despite urgent warnings from her advisers, Thatcher had made no preparations to withstand a conflict with the miners, and she capitulated immediately to their demands. She spent the next three years preparing to take them on: Her government stockpiled coal, devised schemes to smuggle strategic chemicals into power stations, changed the trade union laws and infiltrated MI5 spies into the miners’ inner circle.

When another strike loomed in 1984, she was ready. Previous mining strikes had ended after only weeks. Not this one. Over the course of a year, as Britain waited to see who would break first, Thatcher proceeded to crush the strike with a brutal, calculating ruthlessness that stunned the public. Neither labor nor the unions ever recovered.

2. Thatcher was prim, dowdy and moralistic.

Not at all. As a number of her colleagues told me, she has a ribald sense of humor and was quite unconcerned when her ministers got themselves into sordid adultery flaps. One of her civil servants, for example, remembered desperately trying to finesse a compromise between Thatcher and her chancellor, the Cabinet minister responsible for the economy, during a dispute over the budget.

His delicate diplomacy was upended when Thatcher came back to No. 10 Downing St. from the House of Commons, apparently quite drunk, and discovered her chancellor holding a secret strategy meeting. She strode in uninvited, kicked off her shoes, tucked her heels under herself and declared, “Well, gentlemen, let’s just settle this now, shall we?”

She “held court like a queen bee,” the civil servant said — and thus was it settled in her favor. Afterward, the others could be heard muttering among themselves, “Phwoar, wasn’t she sexy tonight?”

French President Francois Mitterand is said to have famously called her Brigitte Bardot with Caligula’s eyes.

3. She was against European unification.

Yes, she is known as the great Euro-skeptic. But the peculiar truth is that for most of her career, she was a passionate advocate of European unification. In 1975, she led the Tory faction of the “Vote Yes” campaign in a referendum to determine whether Britain should stay in the Common Market, the precursor to the modern European Union.

The Single European Act of 1986, which revised the Treaty of Rome to expand the power of the European Economic Community, as the Common Market was then known, was her initiative.

Thatcher was an ardent Europhile, in fact, until the issue of the single currency came up. That, she believed, would require one European economic policy, leaving Britain without access to the key economic instruments of a sovereign government.

In October 1997, then-Labor Chancellor Gordon Brown announced that the Treasury would set five tests to ascertain whether the economic case for joining the euro had been made. Thatcher might as well have written the test. The case was never made. History has obviously proved her right.

4. No one would meddle with Britain if she were still in power.

It is often said that if only Margaret Thatcher were in power, Britain wouldn’t be in this mess — “this mess” being whatever has just gone wrong. When the British Embassy in Iran was stormed recently, many in the British media rushed to insist that this would never have happened if Thatcher were in charge. GOP presidential candidates Newt Gingrich and Michele Bachmann have invoked her legacy to imply their ferocity when asked how they would formulate policy toward Iran.

But in 1979, U.S. President Jimmy Carter asked Thatcher for “the strongest possible remonstration or action” to pressure Iran, asking Britain to reduce its diplomatic staff in the country. Thatcher responded that she did not believe it “wise to make a political point of any reduction, partly because we doubt whether the Iranians would be much impressed and partly because of the risk of retaliatory action against those remaining.”

In 1984, Moammar Gadhafi loyalists opened fire on demonstrators from the second floor of the Libyan Embassy in London, killing a young British policewoman. The shooters were permitted to leave the country. They were not arrested and tried, despite howls of outrage from the British media.

Why not? Because Thatcher feared reprisals against British citizens in Libya. This is precisely the sort of thing that would never happen if Thatcher were still in power, except that in this case, Thatcher was in power.

5. “Thatcherism” caused the global financial crisis.

This is among the most muddled ideas about Thatcher. It is true that failure of regulation was a significant factor in the 2008 financial collapse and it is true that Thatcher promoted deregulation. As leader of the Opposition, she once interrupted a droning speech by a fellow Tory about the “middle path” the party must follow.

She extracted a copy of free-market thinker Friedrich von Hayek’s “The Constitution of Liberty” from her briefcase, held it up before the audience, then slammed it on the table. “This,” she said, “is what we believe!”

But the deregulation she pursued had nothing to do with the lack of oversight that contributed to the meltdown on Wall Street. Before Thatcher, commissions of civil servants decided, for example, what sorts of cars Britons should drive.

That was the kind of regulation she ended. She was a passionate proponent of regulation that makes free markets function properly — otherwise known as the rule of law in a democracy.

Thatcher supported stringent bank regulation. Consider the 1986 Financial Services Act which, contrary to its reputation, closed loopholes in investor protection laws, boosted the enforcement power of regulators, and applied the same investor protection standards to a broad range of securities and investment activities.

Thatcher stood for thrift, sound money and balanced budgets, powered by private enterprise. The uncontrolled explosion of debt in Western economies that followed her time in power would have appalled her.

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UA has taken a beating just recently, due to some aggressive marketing/competition from Nike.

Is it now a buy?

Simply on the number of shoes/t-shirts/etc that I see being worn, quite possibly. On a ‘chart’ basis, you would probably like to see the end of the downtrend first before committing any cash to the trade.

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For all the talk about how the Federal Reserve has finally decided to pick up the pace of interest-rate increases, the fact is that real rates — or those after taking into account inflation — are not only still negative, but getting even more negative.

Normally, that’s not such a bad thing if the goal of a central bank is to spur growth and the price of assets. But the problem now is that negative rates have weighed on the dollar, which is helping to push asset prices to or close to record highs. Although global economic growth is picking up, it’s nowhere near levels that would justify such valuations. If history is any lesson, then investors might want to study the 1970s, when the Fed responded to similar conditions by stepping up the pace of rate hikes in an effort to cause real rates to turn positive. The period from mid-1976 through March 1978 wasn’t a very good time for stocks and riskier assets in general.

According to Irving Fisher, the early 20th-century economist who is credited with creating the “monetarism” school, when inflation expectations are stable, nominal rates approximate real interest rates. Lately, though, inflation expectations have crept lower, as shown by short-maturity inflation break-even rates falling by 40 basis points after the Fed boosted rates for the second time in three months on March 15.

Japan is an example where inflation expectations became unstable and the Fisher relationship broke down. More recently, Europe and the U.S. have seen volatility in inflation expectations to the extent that Fisher relationships are on the cusp of breaking down for them, too. The consequence is that U.S. and European real interest rates could stay negative, and that may loosen financial conditions even more, cause the dollar to weaken, and spark capital outflows.

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Unbeknownst to the man soon to become the 9th President of the United States was that a “curse” was rumored to have been placed on the occupants of the White House, beginning with Harrison.  Whether it was truly an “Indian curse” placed on Harrison and his successors by Tecumseh (sometimes attributed to his brother, Tenskwatawa) or simply a superstition that was somehow realized, the “curse” lasted for 140 years and, even then, almost claimed another victim, which makes it an extraordinarily odd historical coincidence.  The “curse” is simple:  beginning with Harrison’s election in 1840, every President elected in a year ending in “0” would die in office.  This prophecy indeed began with Harrison in 1840, and continued to come to fruition every 20 years until the late-20th century, as you will see.

1840:  William Henry Harrison
To this day, William Henry Harrison is still the second-oldest man ever elected to the Presidency.  When he took office on March 4, 1841, he was 68 years old and suffering from a bad cold.  Frigid temperatures on Inauguration Day kept the audience in front of the Capitol small, but the new President gave the longest Inaugural Address in history, a massive 8500-word-long speech that took over 90 minutes to deliver – and that was AFTER noted orator Daniel Webster took some scissors to it.  Harrison also decided to give the speech without wearing a hat or an overcoat, and the cold, wet weather left the new President damp and shivering.  Exactly one month later – on April 4, 1841 – William Henry Harrison died of pneumonia, the first President to die in office and the first victim of his old nemesis Tecumseh’s curse.

1860:  Abraham Lincoln
Originally elected in 1860, Lincoln guided the nation through the devastating Civil War, was re-elected in 1864, and finally brought the war to a close in April 1865 when Confederate General Robert E. Lee surrendered to General Ulysses S. Grant at Appomattox Court House, Virginia on April 9.  Five days later, Lincoln told his wife Mary during a carriage ride that, for the first time, he felt that the war was truly over.  With his spirits finally rising, Lincoln took Mary to the theater that night to watch famous actress Laura Keene perform in “Our American Cousin”.  During the play, another famous actor, John Wilkes Booth, shot Lincoln, 56, in the back of the head, and Tecumseh’s Curse claimed another victim the next morning, April 15, 1865.

1880:  James A. Garfield
James Garfield was a rising star in American politics in 1880.  A brigadier general in the Civil War, at one point during 1880 he was simultaneously a sitting member of the United States House of Representatives, Senator-elect from Ohio, and President-elect of the United States.  Garfield never took his Senate seat, of course, deciding to accept the Presidency instead and was inaugurated in March 1881.  Just four months later, President Garfield was fighting for his life after being shot in a Washington, D.C. train station.  He hung on for 80 days, but infections caused by the poking and prodding of doctors and their unsterilized instruments weakened his 49-year-old heart and killed him on September 19th on the Jersey Shore where he was seeking the fresh air of the ocean.

1900:  William McKinley
Like Garfield, William McKinley was a decorated Union soldier from Ohio and in 1896 he was elected President, defeating William Jennings Bryan.  Four years later, he destroyed Bryan once again and was re-elected.  McKinley was an enormously popular President and an extraordinarily kind-hearted man who wore a carnation in his lapel so that he had something to give to people.  In September 1901, the President was shot by an anarchist as he shook hands at Buffalo’s Pan-American Exposition.  Thinking of others, as always, the wounded President first implored that the arresting officers be sure not to hurt the man who had just shot him.  Then he asked that the news of his shooting be broken to his epileptic, semi-invalid wife as carefully as possible.  McKinley lingered for eight days, once again hindered by medical practices of the era, and died, aged 58, on September 14, 1901 – the fourth victim of Tecumseh’s Curse.

1920:  Warren G. Harding
Warren Gamaliel Harding looked like a President and spoke like a President, but as he often said himself, he had no business living in the White House.  Widely considered one of the worst Presidents in American history, Harding’s Administration was plagued by corruption, although Harding wasn’t involved in it.  Harding was involved in several extramarital affairs, however, including one that resulted in an illegitimate daughter and trysts in a closet near the Oval Office.  Depressed by his administration’s many problems, Harding grumbled that he wished his ship would sink in the summer of 1923 when he became the first President to visit Alaska.  Continuing to tour the West Coast, the 56-year-old Harding was ailing from food poisoning and died in San Francisco’s Palace Hotel on August 2nd of either a stroke or a heart attack.  The exact cause of death is unknown because the First Lady refused to allow an autopsy – an action which resulted in many rumors that she had poisoned her husband to protect him from possible impeachment.  It didn’t help her cause when she spent the night before the funeral sitting next to her husband’s open casket in the East Room of the White House while saying, “No one can hurt you now, Warren.”  Harding was the fourth victim of Tecumseh’s Curse to be shipped back to Ohio for burial, preceded by all of the other victims other than Lincoln who was buried in Illinois.

By now, Tecumseh’s Curse was no longer a secret.  Every twenty years since William Henry Harrison’s election in 1840, a President had died.  In fact, only one President besides those elected in years ending in “0” had died in office – Zachary Taylor, who died of cholera in July 1850.  Every other death in office or assassination was coincidentally struck down each and every President elected in the years covered by Tecumseh’s Curse.  In 1934, Ripley’s Believe It Or Not published a story noting the coincidence of the 20-year-intervals between Presidential deaths and listed the the years that they had occurred along with an ominous “1940: ???”.  After the election of 1940 was decided, the cycle continued and Tecumseh’s Curse remained unbroken.

1940:  Franklin D. Roosevelt
Franklin Delano Roosevelt was President longer than anyone in American history ever was and will ever be (unless someone decides to ignore the Constitution).  In 1940, Roosevelt was elected to an unprecedented third term and as the United States fought a World War from both oceans, he won his fourth term in 1944.  The Roosevelt of 1944, however, was a weary, sick man.  Even today, we can see how quickly the Presidency visibly ages the occupants of the Oval Office.  FDR was President for twelve years – twelve years which included crises such as the Great Depression and World War II.  When he was re-elected in 1944, he dumped eccentric Vice President Henry Wallace from the ticket in favor of Harry Truman and likely knew that he wouldn’t survive his fourth term.  On April 12, 1945, Roosevelt was posing for a portrait while resting at his vacation home in Warm Springs, Georgia.  The President was joined by the woman painting the portrait, one of his cousins, and his mistress, Lucy Rutherfurd, and startled the women when he held his hand to his head and said, “I have a terrific headache” before slumping over.  Shortly afterward, he was dead, the victim of a cerebral hemorrhage at the age of 63.  Mussolini died 16 days later, Hitler died 18 days later, and Nazi Germany unconditionally surrendered less than a month after President Roosevelt was buried at his home in New York.

1960:  John F. Kennedy
The first President born in the 20th century wasn’t able to escape Tecumseh’s 120-year-old curse.  John Fitzgerald Kennedy was the youngest President elected to office (Theodore Roosevelt was a few months younger when he succeeded the assassinated President McKinley in 1901) and the youngest President to die in office.  Just 46 years old, JFK was brutally assassinated in front of the world while sitting next to his wife during a motorcade in Dallas, Texas.  Kennedy’s assassination launched numerous investigations, scores of conspiracy theories, and approximately 85% of the History Channel’s regular broadcast lineup.  It also finally brought an end to the cycle of Presidents dying every twenty years that had started with “Old Tippecanoe” back in 1840.


In 1980, the 20-year-curse was a big enough issue that incumbent President Jimmy Carter was asked by a voter in Ohio whether he was worried about the odd coincidence as he ran for re-election.  Carter responded that, “I’m not afraid.  If I knew it was going to happen, I would go ahead and be President and do the best I could (until) the last day I could”.  Carter didn’t have any reason to be afraid; he was not re-elected in 1980, losing in a landslide to former California Governor Ronald Reagan.  Reagan was the oldest President in history when he was inaugurated on January 20, 1981.  At 69 years old, he was almost a full year older than the first victim of Tecumseh’s Curse, “Old Tippecanoe” himself, and Reagan turned 70 less than three weeks after the inauguration.

On March 30, 1981, Reagan very nearly became the eighth victim of the curse when he was seriously wounded during a shooting in Washington, D.C.  Reagan’s wounds, in fact, were much more severe than those suffered by President Garfield a hundred years earlier and President McKinley eighty years earlier.  Reagan, however, was saved by modern medical practices – most significantly from the absence of unsterilized fingers and medical instruments being jabbed into his wound by a wide variety of doctors and medics.  Reagan recovered and served his full eight year term, retiring in 1989, and, to further prove that the cycle was broken, was the longest-living President in history (since surpassed by Gerald Ford) when he died in 2004 at the age of 93.

Was it really a curse?  Well, since Tecumseh died almost 25 years before William Henry Harrison decided to run for President, it would have been an amazingly precise guess that the General would someday make it to the White House.  I’m not the type of guy who believes in “curses” anyway, but the coincidence of the 20-year-intervals between Presidents dying in office is striking, and the near-miss of Reagan in 1980 just adds to the intrigue.  President George W. Bush, elected in 2000 (well…kind of), made it through his two terms safely, so whatever the cause of the cycle, it is definitely over now.  All I know is that, coincidence or not, I’m not messing with Tecumseh.

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“The most effective way of making everybody serve the single system of ends toward which the social plan is directed is to make everybody believe in those ends. To make a totalitarian system function efficiently, it is not enough that everybody should be forced to work for the same ends. It is essential that the people should come to regard them as their own ends.”[p.171]

Berit’s comment: Ponder that statement. It helps explain the significance of universal service-learning. Like socialist youth in Nazi (National Socialism) and Communist countries, all must embrace the new ideology. Those who don’t — the intolerable dissenters — must be silenced. The next section elaborates:

“Although the beliefs must be chosen for the people and imposed upon them, they must become their beliefs, a generally accepted creed which makes the individuals as far as possible act spontaneously in the way the planner wants. If the feeling of oppression in totalitarian countries is in general much less acute than most people in liberal countries imagine, this is because the totalitarian governments succeed to a high degree in making people think as they want them to.”[p.171]

 The strategies that accomplish this mental change include numerous subtle and obvious forms of propaganda. Schools, the media, children- and youth-service teams, corporations, etc…. every source of propaganda must share the same vision. Though totalitarian, it will be designed to sound noble, compassionate and fair to all. Yet the result with be the exact opposite.

Ponder this warning from Dr. Thomas Sowell‘s review of Road to Serfdom:


“At the heart of the socialist vision is the notion that a compassionate society can create more humane living conditions for all through government ‘planning’ and control of the economy….


“The rule of law, on which freedom itself ultimately depends, is inherently incompatible with socialism. People who are free to do as they wish will not do as the economic planners wish. Differences in values and priories are enough to ensure that. These differences must be ironed out by propaganda or power, if socialism is to be socialism. Indoctrination must be part of the program, not because socialist want to be brainwashers, but because socialism requires brainwashing.


Idealist socialist create systems in which idealist are almost certain to lose and be superseded by those whose drive for power, and ruthlessness in achieving it, make them the “fittest” to survive under a system where government power is the ultimate prize.… The issue is not what anyone intends but what consequences are in fact likely to follow.”[39]


In his article, aptly titled “A Road to Hell Paved with Good Intentions,” Sowell points out that “Marxism as an ideal continues to flourish on American college campuses, as perhaps nowhere else in the world.” Collectivist visions appeal to academic idealists and others who ignore the lessons of history.

“….all propaganda serves the same goal—that all the instruments of propaganda are coordinated to influence the individuals in the same direction…. The skillful propagandist then has power to mold their minds in any direction he chooses, and even the most intelligent and independent people cannot entirely escape that influence if they are long isolated from all other sources of information. [p.171-172]

President Obama is now taking control of this change process by transferring workers from the private sector (corporations, private enterprise…) to the government service sector. With the controlled media on his side, the masses are not exposed to contrary facts.

“…even the striving for equality by means of a directed economy can result only in an officially enforced inequality—an authoritarian determination of the status of each individual in the new hierarchical order—and that most of the humanitarian elements of our morals, the respect for human life, for the weak, and for the individual generally, will disappear….

“The moral consequences of totalitarian propaganda which we must now consider are, however, of an even more profound kind. They are destructive of all morals because they undermine one of the foundations of all morals: the sense of and the respect for truth.

“…in order to induce people to accept the official values, these must be justified, or shown to be connected with the values already held by the people, which usually will involve assertions about causal connections between means and ends.  …people must be brought to agree not only with the ultimate aims but also with the views about the facts and possibilities on which the particular measures are based.[p.172]

Al Gore’s battle against a mythical man-made global warming crisis illustrates this point. Globalist change agents agree that a worldwide crisis is needed to persuade humanity to embrace all the costly restrictions and regulations of government controlled “sustainable development.” So they are willing to ignore facts and embrace myths and pseudo-science in order to reach their goal.

“We have seen that agreement on that complete ethical code, that all-comprehensive system of values which is implicit in an economic plan, does not exist in a free society but would have to be created….

“And while the planning authority will constantly have to decide issues on merits about which there exist no definite moral rules [apart from the Bible], it will have to justify its decisions to the people—or, at least, have somehow to make the people believe that they are the right decisions….

“This process of creating a ‘myth’ to justify his action need not be conscious. …  So [the totalitarian leader] will readily embrace theories which seem to provide a rational justification for the prejudices which he shares with many of his fellows. Thus a pseudoscientific theory becomes part of the official creed which to a greater or lesser degree directs everybody’s action. [p.173]

“The need for such official doctrines… has been clearly foreseen by the various theoreticians of the totalitarian system…. They are all necessarily based on particular views about facts which are thenelaborated into scientific theories in order to justify a preconceived opinion.

“The most effective way of making people accept the validity of the values they are to serve is to persuade them that they are really the same as those which they… have always held, but which were not properly understood or recognized…. The people are made to transfer their allegiance from the old gods to the new under the pretense that the new gods really are what their sound instinct had always told them but what before they had only dimly seen. And the most efficient technique to this end is to use the old words but change their meaning. Few traits of totalitarian regimes are … so characteristic of the whole intellectual climate as the complete perversion of language….

“The worst sufferer in this respect is, of course, the word ‘liberty.’ It is a word used as freely in totalitarian states as elsewhere…. Dr. Karl Mannheim… warns us that ‘a conception of freedom modeled on the preceding age is an obstacle to any real understanding of the problem. But his use of the word freedom is as misleading it is in the mouth of totalitarian politicians. Like their freedom, the ‘collective freedom‘ he offers us is not the freedom of the members of society but the unlimited freedom of the planner to do with society what he pleases….[pps.174-175]

“In this particular case the perversion of the meaning of the word has, of course, been well prepared …. by many of the theoreticians of socialism. But ‘freedom’ or ‘liberty’ are by no means the only words whose meaning has been changed into their opposites to make them serve as instruments of totalitarian propaganda. We have already seen how the same happens to ‘justice’ and “law,’ ‘right’ and ‘equality.’ The list could be extended until it includes almost all moral and political terms in general use.

“… the confusion becomes worse because this change of meaning of the words describing political ideals is not a single event but a continuous process, a technique employed consciously or unconsciously to direct the people….

“It is not difficult to deprive the great majority of independent thought. But the minority who will retain an inclination to criticize must also be silenced. … Since many parts of this code will never be explicitly stated… every act of the government, must become sacrosanct and exempt from criticism. If the people are to support the common effort without hesitation, they must be convinced that not only the end aimed at but also the means chosen are the right ones.”[p.175]

Facts and theories must thus become no less the object of an official doctrine than views about values. And the whole apparatus for spreading knowledge—the schools and the press, radio and motion picture—will be used exclusively of to spread those views which, whether true or false, will strengthen the belief in the rightness of the decisions taken by the authority; and all information that might cause doubt or hesitation will be withheld.”[p.176]

Stanford University Professor Steven Schneider illustrates it well. He said,

“On the one hand, as scientists, we are ethically bound to the scientific method, in effect promising to tell the truth, the whole truth, and nothing but–which means that we must include all the doubts, the caveats, the ifs, ands, and buts. On the other hand, we are not just scientists but human beings as well. And like most people, we’d like to see the world a better place, which in this context translates into our working to reduce the risk of potentially disastrous climatic change.
“To do that, we need to get some broad based support, to capture the public’s imagination. That, of course, entails getting loads of media coverage. So we have to offer up scary scenarios, make simplified, dramatic statements and make little mention of any doubts we might have… Each of us has to decide what the right balance is between being effective and being honest.” (See endnote #38 in Saving the Earth)

This applies even to fields apparently most remote from any political interests and particularly to all the sciences, even the most abstract. That in the disciplines dealing directly with human affairs and therefore most immediately affecting political views, such as history, law or economics, the disinterested search for truth cannot be allowed…. These disciplines have, indeed, in all totalitarian countries become the most fertile factories of the official myths which the rulers use to guide the minds and wills of their subjects….” [p.176]

n “Government religion in the United States,” Erica Carle wrote:
“The separation of church and state argument for removing all traces of Biblical teaching from public life and public land is a gigantic fraud. Why? Because there is no separation of church and state. Government religion is a fact in the United States. What is wanted by the government religion adherents is not separation of church and state, but exclusive rights for their religion.”What is the government religion? Auguste Comte (1798-1857), its French founder, called it the Religion of Humanity. The doctrines of the Positive Religion are now taught in the schools as a science which Comte called sociology. Sociology was to be the ruler science over all the other sciences and also the science of managing the world…. In a country that is supposed to be free,

  • its citizens are being subjected to sociological management,
  • its scientists and elected officials to sociological control, and
  • its youth to sociological education.

“…we must yet be on our a guard not to dismiss .[these aberrations] as mere accidental by-products which have nothing to do with the essential character of a planned or totalitarian system….They are a direct result of that same desire to see everything directed by a ‘unitary conception of the whole.’…


“Once science has to serve, not truth, but the interests of a class, a community or a state…. As the Nazi minister of justice has explained, the question which every new scientific theory must ask itself is: ‘Do I serve National Socialism for the greatest benefit of all?’
The word ‘truth’ itself ceases to have its old meaning.  …it becomes something to be laid down by authority, something which has to be believed in the interest of the unity of the organized effort and which may have to be altered as the exigencies of this organized effort require it.
“The general intellectual climate which this produces, the spirit of complete cynicism as regards truth which it engenders, the loss of the sense of even the meaning of truth, the disappearance of the spirit of independent inquiry…. Perhaps the most alarming fact is that contempt for intellectual liberty is not a thing which arises only once the totalitarian system is established but one which can be found everywhere among intellectuals who have embraced a collectivist faith and who are acclaimed as intellectual leaders even in countries still under a liberal regime.


“Not only is even the worst oppression condoned if it is committed in the name of socialism, and the creation of a totalitarian system openly advocated by people who pretend to speak for the scientists of liberal countries; intolerance, too, is openly extolled….” [p.178]

“This view is, of course, practically indistinguishable from the views which led the Nazis to the persecution of men of science, the burning of scientific books, and the systematic eradication of the intelligentsia of the subjected people.

“The desire to force upon the people a creed which is regarded as salutary for them is, of course, not a thing that is new or peculiar to our time. New, however, is the argument by which many of our intellectuals try to justify such attempts.” [p.179]
The tragedy of collectivist thought is that, while it starts out to make reason supreme, it ends by destroying reason….”[p.180]