The Sorrow and Rage of a Schoolhouse Rocker

When I was a boy of five or six, I would wake up bright and early every Saturday morning, and slink downstairs to watch TV in the family room—just dive into the stream of morning cartoon shows that played at that magic hour, and let my little brain cells dissolve in the stew of sugary ‘toons, even as I restlessly twisted the channel selector from side to side—clickety-clack! cli-cli-clickety-clack!—looking for something good.

But in between all that visual junkfood—all of which I’ve long since forgotten—there were these little animated films that played during the commercial breaks, called “Schoolhouse Rock!”.

The “Schoolhouse Rock” cartoons were two-minute masterpieces, with bold drawings and incredibly catchy songs, each explaining a different academic subject or topic. Famous ones were “Conjunction Junction”, “Three Is A Magic Number”, “The Great American Melting Pot”, “I’m Just a Bill”, “The Preamble”.

Consider how good, how wonderfully entertaining these little educational cartoons must have been: I am now 44 years old, but I can sing—off the top of my head—maybe a dozen of the “Schoolhouse Rock” songs.

For instance, the chorus to one of my favorites—“Interjection!”:Read more »

Fighting The Terrorists By Terrorizing The Innocent

Something I read:

In the United States, the dominant narrative about the use of drones in Pakistan is of a surgically precise and effective tool that makes the US safer by enabling “targeted killing” of terrorists, with minimal downsides or collateral impacts.

This narrative is false.

These are the first words of a devastating report I’ve just read, “Living Under Drones: Death, Injury, and Trauma to Civilians from US Drone Practices in Pakistan”.

This thing is required reading.

This isn’t some half-assed, crazed droolings of some hippy-dippy Lefty twerp who ought to get a bath and a haircut: This was written by Stanford and New York University lawyers—and it shows. It’s clearly and devastatingly written, with the facts, testimony and evidence so scrupulously laid out that it’s almost like the brief for the prosecution of the war crimes trial that we can only pray will one day take place.

Consider this:

Drones hover twenty-four hours a day over communities in northwest Pakistan, striking homes, vehicles, and public spaces without warning. Their presence terrorizes men, women, and children, giving rise to anxiety and psychological trauma among civilian communities. Those living under drones have to face the constant worry that a deadly strike may be fired at any moment, and the knowledge that they are powerless to protect themselves. These fears have affected behavior. The US practice of striking one area multiple times, and evidence that it has killed rescuers, makes both community members and humanitarian workers afraid or unwilling to assist injured victims.

The bold emphasis is mine. I highlighted it because it reminded me of a tactic that terrorists are famous for using: Plant a bomb and kill some people, and when the ambulance, police and rescuers arrive, set off a second bomb so as to kill even more people.

I’m still processing this report, but the questions that immediately come to mind—jumbled, confused, unsystematic, irrational, yet crucial just the same—are myriad:

• How much courage does it take to kill innocent people by remote control?

• What can be gained by murdering women and children who have never done anyone any harm?

• What happens to a cause or country that achieves “victory” by terrorizing innocent human beings?

• How can the people who carry out such evil possibly live with themselves?

• How can anyone with any sense of decency follow the leadership of men and women who would knowingly commit such atrocious and despicable acts?

Notice those questions: They are the questions people ask of terrorists who commit murder for the sake of their cause—

—but they are also now the questions any humane, decent person must ask of the United States.

Because the United States is now the greatest terrorist agent in the world.

How do I know that the U.S. is now a terrorist state? Do I know because it has killed more innocent people in the last twelve months than all other “terrorists” in the world combined?

No. Terrorism isn’t a matter of numbers—it’s a matter of fear: Putting terror—blinding, relentless fear—into the hearts and souls of people who have done nothing wrong. As in the words of this Pakistani boy:

“We cannot figure out when a drone will strike—they may strike in two days, three days, ten days, or a month—but they are always there.”

That is how I know that America has become a terrorist state.

The question for any and every American citizen is: Will you stand up and fight a government which—in your name—is terrorizing innocent people?

Or will you acquiesce to this evil.

How A Country Rationally Exits The Eurozone

Hi all. Sorry for being away—it couldn’t be helped. Enjoy the new post. More will be forthcoming on a steady basis. GL

We are about to experience the Euro Exit Crisis.

Mish Shedlock and I have a private bet as to whether Italy or Spain will exit first—he says Italy, I say Spain. But either way, it’s gonna pretty much suck.

The whole point of exiting the eurozone is because a country no longer has the money to finance its continuing operations. Insofar as Spain, Greece and possibly Italy, that moment will arrive shortly—possibly within days in the case of Spain. So if a sovereign government reaches this moment, it will have no choice but to exit the EMU and revert to a local currency which the government can then devalue.

By doing this, the government simultaneously has all the cash it needs to continue operations, and also inflates away its debts. The private sector gets a shot of adrenaline insofar as foreign trade is concerned, because its goods and services become that much cheaper on the foreign markets. And the employment situation gets a boost, as those producers selling their cheap goods and services overseas begin to hire more workers to fulfill demand.

The downside is that the government gets shut out of foreign bond markets, its financial sector takes a huge hit, and prices for essential goods and services rise dramatically, hurting the poor, the lower middle-class, the elderly, and the unprepared.

Even with these negatives, though, a forced conversion and devaluation is a boon to bankrupt nations. It is, basically, a reset of the economy: And historical experience shows that though it hurts a lot in the short term, it helps to reignite an economy, and get the people moving once again. This has been true of the United States in 1933, Germany in 1948, Latin America in the 1980’s, Argentina and Uruguay in 2001.

But it’s crucial to understand both the sequence and the mechanics of the process, in order to be able to anticipate what will happen, and thus make sound investment choices.
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Structural Pliancy

Don't be fooled—it's flexible at the top.

A lot of people—and I am one of them—claim that personal and business freedoms are being eroded as never before. They show as evidence the roll-back of civil liberties, the over-regulation of business, the insistence on “compliance” by the various security agencies of every little rule, no matter how trivial—in short, the over-regulation of American life.

They are right: The U.S. government is guilty of over-regulating individuals and businesses—egregiously so.

On the other hand, a lot of other people—and I am one of them too—claim that certain persons and corporations act lawlessly as never before. They show as evidence the abuses of power of those in leadership—be it business, government, the military, or the intelligence/security aparatus—and they insist that something has to be done about it, some regulations have to be imposed.

They are right too: The U.S. government is just as guilty of under-regulating certain individuals and businesses as it is of over-regulating other people and businesses.

Obvious question: How can they both be right? How can it be that a few people, a few businesses, a few institutions are getting away with murder—in some cases literally—while most of us are under a crippling yoke of excessive, dishonest, petty and trivial rules and regulations that either serve no purpose, or actively pervert the welfare of our society?

Simple answer: Structural Pliancy.

Let me explain. Read more »

You Are Free To Travel—If The IRS Lets You

A bill that nobody is paying any attention to is sailing through Congress: Senate Bill 1813. It passed the Senate by 74 to 22, and is expected to sail through the House as well. It’s an act “[t]o reauthorize Federal-aid highway and highway safety construction programs, and for other purposes.”

It’s the “and for other purposes” part of the title that has me worried—specifically Section 40304: “Revocation or denial of passport in case of certain unpaid taxes.”

This section would give the IRS the power to keep a U.S. citizen from traveling—

—and it’s another example of Executive Power run amok. It’s another example of how the United States is turning into a police-state.

The right to travel freely is sacrosanct—it’s not some privilege that the government bestows on us: It’s one of our basic freedoms as citizens. In point of fact, the countries that have limited their citizens’ ability to travel—the Soviet Union, the People’s Republic of China, North Korea, Cuba—were all rightfully called “police-states”: It’s one of their defining characteristics—the fact that they were keeping their citizens hostage.

In the United States, there are several, clearly defined reasons why you would have your passport either denied or revoked—and all of them pass the smell test.

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Will There Be A “Corralito” In Spain?

Yes, it’s a metaphor. Of what, I dunno.

How Spain could exit the eurozone—a practical guide.

In late 2001, while everyone was in shock over 9/11, the Argentines were going through a little shock of their own: The “Corralito”.

Argentina was bankrupt, a product of a stagnant economy, rampant crony-corruption, and—most important of all—of having its currency fixed to the dollar. This currency peg had created a huge credit bubble, and of course massive capital outflows as a result, eventually leading to the depletion of foreign reserves by the government and an inability to raise more funds on the open markets.

In other words, sovereign bankruptcy.

Coupled to these problems, in the months leading up to the December 2001 crash, people were aware that the country was going bankrupt—so they were quickly converting all their Argentine pesos into dollars, and then sending this money to safe havens overseas.

To solve these problems of sovereign insolvency and massive capital flight, and at the same time to stabilize the situation, on December 1, 2001, the Argentine government imposed the infamous corralito—literally, the “little bullpen”: A series of measures designed to hold in capital and prevent it from fleeing the country, while devaluing the currency to a more realistic, sustainable rate of exchange.

As part of the corralito measures, the Argentine government froze all dollar-denominated bank accounts; converted those dollars into Argentine pesos on a one-to-one basis—that is, confiscated people’s dollars; limited all withdrawals in Argentine pesos to a weekly maximum of AR$250 (you read right: per week); and of course—the cherry on the sundae—it devalued the Argentine peso against the dollar.

The devaluation was at first a “mere” 40%—but shortly thereafter the Argentine peso was allowed to float: And it dropped to a rate of four to one against the dollar.

Literally millions of people lost their life-savings in one fell swoop. The local equity market tanked catastrophically, as did the local bond markets. People on a fixed income also got clobbered, as their pensions lost their purchasing power by 40% overnight—and then eventually by 75%.

Chaos ensued.

Now, the situation in Europe today is virtually identical to that of Argentina in 2001: Overleveraged, with an insolvent banking sector, a flatlining economy and growing unemployment.

But of all the countries, Spain in particular is the biggest trouble.

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Spain Will Exit The Eurozone First—This Year

This post is adapted from a piece that originally appeared at my Strategic Planning Group. I've been doing a lot of work over there—hence the scarce postings over here. Sorry! GL

In the LiraSPG Scenario “When The Euro Breaks”, I discussed what would happen to the euro and the eurozone when those countries—unable to continue under their massive debt burdens—began exiting the European monetary union.

One of the assumptions I made was that one of the smaller nations of the eurozone would leave the monetary union first, thereby encouraging one of the bigger nations to follow their example and leave as well. I postulated that the small country would likely be Greece, and that the large country would probably be Spain.

From this exodus, I analyzed what would happen to the euro vis-à-vis gold and the rest of the world’s currencies—namely, that the euro would suffer a staggered loss of value against commodities and other currencies: An initial drop-and-recovery when the smaller nation exited the eurozone, followed by a sustained drop when the big nation exited the monetary union.

The Scenario was written and published on the LiraSPG site in May 2011.

Since then, I have changed my mind: I no longer think that a small country will exit the eurozone first, followed by one of the bigger countries.

I now think that Spain will exit the eurozone first—precipitously and without warning—and that the impact on the euro will be much more sudden and dramatic than I had earlier thought.

In this SPG Supplement, I will explain my thinking. First I will discuss the general European situation; then the Greek debacle, and how the European leadership has lost sight of what salvaging Greece was supposed to be about; then the current Spanish situation, how it is unsustainable, and how the new Rajoy government’s only escape—politically and economically—is to default and then exit the eurozone.

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The Execution of Lady Jane Grey

The Execution of Lady Jane Grey
by Paul Delaroche (1830).
(click to enlarge)

I’m an arts junkie. Since I was a kid, I hoovered up just about every piece of literature, music, art, film—whatever I could lay my hands on.

Because I started to appreciate art at so young an age, I’ve got a healthy promiscuity in my tastes, and lack any snobbery about what can be great art. Pop music or academic paintings, cheap industrial design or refined Swiss watches—it’s all good to me.

What I loved was the high you get from discovering a truly great work of art. I loved the familiarity that great art produces in you—the sense that you’ve seen this work before (when of course you never have), heard this music before (when of course you never have), heard this story before (when of course you never have). Few people can remember the first time they heard The Police’s “Every Breath You Take” or The Beatle’s “Yesterday”, or saw The Godfather or Casablanca—they can’t remember because they are such perfect works of art that they slip into your consciousness as if they’d always lived there. As if they are as much a part of you as breathing.

So I went to the Louvre today, the first of a six day exploration I have mapped out—and it was a bit disappointing: I’d seen everything already.

Certainly it was a thrill to see, say, David’s The Coronation of Napoleon in the flesh. The sheer size of the painting made it memorable—after all, all of the version’s I’ve ever seen fit on a computer screen or a coffee-table book. None of those versions could compare to the brilliance and life and sheer size of the 60 square meter original.

But there was nothing novel about that painting, or in fact, any of the other works that I saw: They were all paintings and sculptures that I’d either seen countless times before, or in fact had studied and memorized; or works which, though I didn’t know them, I recognized as part of a movement, or as a lesser example of so-and-so’s work, or as a—

—then I came across Delaroche’s The Execution of Lady Jane Grey.

It was overwhelming. I was overwhelmed. It was like stumbling on a scene I had always had in my mind, yet could not recall. The brightly lit, white central figure—helpless, as she reaches out to keep from stumbling—reaching out to the discrete executioner’s block, which will be the end of her. The grave men beside her, at once determined yet sorrowful. The wailing, duplicitous women. The plush velvet cushion—to absorb the weight of the young girl’s knees, and protect them from injury—contrasted with the coarse straw matting—to absorb the young girl’s blood, and protect the ground from its stain.

The longer I stared at the painting, the more its beauty overwhelmed me.

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France’s Upcoming Election Means Euro Devaluation—and a Pop In Gold

On May 6, France is holding its second round of Presidential elections, where the Socialist François Hollande is fully expected to win.

François Hollande

I’m pretty sure two things will happen immediately following the election: The first is, Carla Bruni will leave Nicolas Sarkozy (because everyone knows that a professional courtesan never stays when the going gets tough for her patron).

The second thing that will happen following the election of Hollande is that the euro will begin to fall—amid persistent, insistent calls by the new French President for Europe to spend its way out of the hole it’s in.

In other words, France is about to elect their version of Paul Krugman to the Presidency.

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My Lunch with Francis Ford Coppola

Le Marais, Paris.

I was walking to my apartment along the rue Réamur, looking for a place for a quick late-lunch, when I noticed the moving dishes at this sushi bar called Eat Sushi—

Francis Ford Coppola

—and spotted Francis Ford Coppola sitting at the window.

I thought, “That can’t be him—that’s way too random. But I sure could eat!”

So I walked in, and plopped myself just two stools over from him, thinking he was just some random Frenchman who looked a lot like the Big Man of films.

The guy sitting at the stool in the sushi bar looked like a random French gentleman: Big and portly, plump of lip, froggy-eyed behind his round steel bifocal glasses, in a light brown beret and colorful but old scarf. And of course the beard: Snow white, and surprisingly well groomed.

Was he him? Nah—can’t be him: I’ve just arrived in Paris and I run into Francis Ford Coppola? Of all people? When, just two nights before—true story—I had been berating my girlfriend for never having seen The Godfather or The Godfather, Part II? And telling her—at length—that everything you needed to know about men was in those two Coppola movies?

Too weird and random to be true.

I’m not particularly interested in celebrity or celebrities per se. But for some reason, I’ve met an awful lot of them—all by chance.
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Fearless Prediction: On March 20, Greece Will Default

On March 20, Greece has to come up with €14.3 billion—or else it will be bankrupt.

Of course, Greece doesn’t have €14.3 billion—that’s why the Troika of the IMF, the EC and the ECB are trying to hammer out a deal to bail them out again: A bailout to the tune of €136 billion. They’ve had marathon-length negotiating sessions, one “crucial emergency meeting” after another—hell, they even called the Pope to send them a case of holy water and a truckload of wooden stakes. I’m serious!

Last Monday, a deal seemed to have emerged: That’s what the announcement sounded like. In fact, it looked so much like a done deal—it was spun so decisively as a done deal—that I was all set to write something snarky like, Greece Takes It Greek Style: “Thank You Troika, May I Have Another” Bailout On Its Way. (What can I say: I’m a vulgar bastard.)

But then . . . then we all started looking at the fine print of the deal. And that’s when everyone who follows this stuff started to realize that the deal wasn’t a deal—merely the illusion of a deal.
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The Deflationary Undertow Before The Inflationary Wave

Ride the wave, or drown. 

War between Israel and Iran now seems inevitable. Leon Panetta claimed that it would be this coming spring—and I see no reason to doubt him.

How an Israeli-Iranian war will play out—that is, whether it will draw in more geopolitical actors (such as the U.S.), or if it will be a series of limited attacks, counter-attacks, and then stalemate—is impossible to predict. War tends to take on a life of its own.

But we can predict how it will affect the global markets.

A very reasonable assumption is that oil supplies, especially to Europe, will be severely curtailed. Aside from the fact that one fifth of the world’s oil production passes through the Straight of Hormuz—ground zero of a war with Iran—the rest of the world and especially Europe depends on Iranian oil. As discussed in the SPG Scenario of this past June (“An Israeli-Iranian War?”), close to 10% of the eurozone’s oil comes from Iran—and the countries most particularly dependent on Iranian oil are precisely those most in trouble right now: The so-called PIIGS.

So oil prices will inevitably rise. And so—just like 1979, after the overthrow of the Shah of Iran and the subsequent Oil Shock—the world’s economies will experience another likely oil shock which will send up the price of oil, hurting the world economies rather badly—

—and driving up inflation.

Dollar inflation and euro inflation is in the offing, in the weeks and months following a war with Iran. The assets that will rise drastically in price will be precious metals, especially silver; agricultural commodities; and oil—obviously. The assets that will collapse in price will be sovereign bonds, corporate bonds, and equities, in that order. In the Scenario, I discussed which countries will hurt the most, so I won’t bother repeating what I wrote there.

However, notice I say that inflation will rise “in the weeks and month following a war with Iran”: A war with Iran which disrupts oil supplies will—inevitably—lead to an inflationary wave.

But before that inflationary wave hits—that is, in the days and hours following the beginning of the war—we will experience a deflationary undertow.

This deflationary undertow will present some interesting opportunities.
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A Tale of Two Settlements

So yesterday, there were two big settlements: Greece, and the Mortgage Mess.

Completely independent of each other, both settlements not only happened on the same day, they happen to highlight two issues which ought to be bugging us all like cockroaches crawling through our underwear.

Issue One is how in both cases, the Too Big To Fail banksters won—and they won big. Again. Insofar as the mortgage settlement goes, they got what amounted to a speeding ticket, while getting a Get-Out-of-Jail-Free card on the worst of the robo-signing and illegal foreclosures scandal. And insofar as the Greek situation goes, the banksters have gotten the IMF, the ECB and the EC to essentially put the Greek people’s collective nuts in a vise and squeeze until they scream “θείος!” (“Uncle!”)

Issue Two is the mainstream media’s spin on these two settlements: How the completely cheerleadery, near-sycophancy of the MSM serves to both obscure how big the banksters won in both settlements, and to give us all a false sense of security. From the MSM, we hear that Greece has been “bailed out” and the Mortgage Mess has been “fixed”, and that the banksters are “getting their comeuppance”—so we get the false sense that the world is right as rain, and everything can slowly go back to normal.

But the world is not right. We will not be going back to normal any time soon. The banksters are not getting righteous justice.

Rather, the two settlements go to show how crony-corrupt our particular epoch’s Global Capitalism really is: The banksters rape the people of two countries, and the mainstream media cheers.

Let’s go over each of the two settlements, and pick apart their implications.

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The Perniciousness of ZIRP

Suppose that I promised to give you free chocolate for the next three years: How much chocolate would you eat today?

Mmm . . . money . . .
—er, I mean: Mmm, chocolate . . .

A pound? Half a pound? A few ounces? Or would you not eat any chocolate at all, once I made the announcement? After all, you’re going to have free chocolate for the next three years—seems silly to gorge on chocolate today, when you can have as much as you’d like tomorrow, or next week, or whenever you want over the next three years.

So free chocolate for the next three years? Great! . . . uh, only not right now, thanks very much: I’m kinda full.

But then what if I said to you, “Chocolate is free now—but I’m definitely going to raise the price in the near term. In a month, chocolate might be free—or then again, it might cost $1,000 an ounce. So get some while you can, because tomorrow, you never know!”

Well, obviously, to such an uncertain outlook, you’d go out and buy some chocolate now—because tomorrow, it might well be unaffordable.

In fact, it seems quite obvious that if you don’t know when I’m going to raise the price of chocolate, you’ll probably wind up buying—and eating—more chocolate than if it was free. A paradox? Sure—but true.

In point of fact, if the chocolate is free, you might not eat any chocolate at all. Every time you make the decision as to what to eat, you might well find yourself repeating the same mantra: “Chocolate is free—I can have it any time I want. So I won’t have any now.”

This is the problem Ben Bernanke and the Federal Reserve currently have—and it’s their own stupid fault: They have promised to maintain interest rates at effectively 0% until at least the end of 2014—they have in fact announced this zero interest-rate policy (ZIRP) as the hallmark of their strategy to reignite the economy—

—but then they’re surprised when businesses aren’t borrowing more. They’re surprised when lending is in fact contracting. They’re surprised when the American economy doesn’t start borrowing—and thus growing—like crazy.

So the American economy obviously doesn’t benefit from ZIRP. In fact, it stagnates because of ZIRP.

Read more »

Me on Max Keiser

This was taped this past Tuesday, and just went on the air: A lively conversation with Max Keiser.

Apparently, I’ve been banned in the UK because of some of the things I said here—which is pretty cool: I’ve never been banned before.

Enjoy!

This Is America Today, Part II

These facts are from the CIA—and they are undisputed:

• Infant mortality rate in the United States: 6.06 per 1,000 live births.

• Infant mortality rate in France: 3.29 per 1,000 live births.

• Average life expectancy in the United States: 78.37 years (75.92 for men, 80.93 for women).

• Average life expectancy in France: 81.19 years (78.20 for men, 84.54 for women).

• Total expenditure on health care in the United States: 16.2% of GDP (2009).

• Total expenditure on health care in France: 3.5% of GDP (2009).

• Expenditure on health care in the United States per capita: $7,517 per year (2009).

• Expenditure on health care in France per capita: $1,148 per year (2009).

So . . . to make it clear: France has a Socialist-Commie health care system, while the United States has “the best health care system in the world”—

—and yet the French live longer, have an infant mortality rate roughly half the United States’, and yet still manage to spend less than Americans on health care.

A lot less—in fact, the Socialist-Commie Frogs spend less than a quarter of what the United States does, as a proportion of GDP.

And when you break it down per person per year? The French spend less than one-sixth what the United States spends—yet live longer, and have a lower infant mortality rate

These are the facts—and they are undisputed.

So! One of two things is going on: Either the French—as a people—are simply better than Americans; made of finer stuff; simply superior physical specimens.

Or . . .
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This Is America Today, Part I

A true story: A fifty-ish woman I know was diagnosed with breast cancer. Dutifully, she and her husband contacted their insurance company to start the process of paying for her medical bills.

But lo and behold, the insurance company started dragging its feet—then tried to claim the woman’s breast cancer was a “pre-existing condition”.

That she had breasts in fact was a “pre-existing condition”—a “pre-existing condition” she had had since she was fourteen.

But the cancer? That was brand new.

The woman and her husband started the usual, insurance company-designated complaint process—which they quickly realized was a deliberate rigamarole, designed to get them spinning their wheels without receiving any money from the insurance company.

So they did the smart thing: They contacted lawyers. Not “a” lawyer, but a team of lawyers—four in fact, including a partner in a name law firm in her city.

This squad of lawyers had a morning meeting with the insurance company people.

In less than a single business day, the insurance company started paying up. In the two years since this little “episode”, as the cancer stricken woman calls it, she and her husband haven’t had a single problem with their insurance company.

This is America today.

The insurance company didn’t act im-morally so much as a-morally: They made the cold-hearted calculation that it wasn’t worth their while to pay off the woman’s justifiable claim—until she showed up with a squad of lawyers. Then the insurance company made another cold-hearted calculation: That it was cheaper to pay off her legitimate claim than to fight her lawyers.

So they paid: Not because they were contractually obliged to—as they were—or because it was the right thing to do—as it was. No: They paid off her claims because it was cheaper than trying to wriggle out of their obligation.

This is America today.

What If The Government Takes Over Wikipedia?

A quick post.

As most people know, Wikipedia will go offline on Wednesday—in protest over the Stop Online Piracy Act (SOPA) and the Protect Intellectual Property Act (PIPA). The Financial Times has a brief but fairly comprehensive overview of what’s going on here.

A lot of people online—myself included—are against both SOPA and PIPA. And for one, I fully support what Wikipedia is trying to do: Shut itself down—the sixth most visited website on the planet—and thereby get those 234 million daily users to read its statement opposing SOPA and PIPA.

Knowing the editorial judiciousness of Jimmy Wales and the Wikipedia team, I have no doubt that, one, their opposition has been carefully thought through; and two, this unprecedented step of shutting down the site is extraordinarily serious—and thus emphasizes how seriously Wales and his team take the measures in SOPA and PIPA.

In other words, Wales and his team aren’t fucking around—this is a big deal.

But I couldn’t help wondering: The U.S. government must also recognize that this isn’t a temperamental teenager throwing hissy-fit—Wikipedia is seriously respected in the online community. Wikipedia’s shut-down is a big black eye to SOPA and PIPA—and to the people who are pushing it, especially Barack Obama’s White House.

So what if the U.S. government were to decide to take over Wikipedia? Prevent it from going offline? With the excuse that they’re taking it over and keeping it online “for the good of the American people”?

Let’s face it, Wikipedia is incredibly important to the Internet. Most of us go to Wikipedia first, if a quick Google search doesn’t get us the info that we need. And whenever we want to get the skinny on something complicated, Wikipedia is often the only place we go to.

Thus we are all particularly dependent on Wikipedia: It shapes our knowledge base much more profoundly than we either realize, or would probably like to admit. The fact that it doesn’t advertise, and depends instead on donations alone, gives it even more credibility, and to our eyes makes it that much more trustworthy.

But Wikipedia is an incredibly small, incredibly fragile operation. It’s yearly budget is less than $20 million per year—nothing, when compared to, say, the bailout of Citi.

Just as it declared Citi, BofA, Goldman and JPMorgan “Systemically Important Financial Institutions”, what’s to stop the U.S. government from declaring Wikipedia a “Systemically Important Website”?

And rather than throwing money at them, what’s to stop the government from revoking Wikipedia’s non-profit status? Declaring it a for-profit—and then using the IRS, say, to take it over? Or better yet, prevent it from shutting down by delaring it “Educationally Essential Website”—and putting it under the aegis of the Education Department? Take it over “for the good of the country”? And then maybe start shading and editing the various Wikipedia entries in order to give a “more balanced version of events”?

“Paranoid”, you say? Well, it’s not paranoia if they’re really coming after you.

Famously, Senator Joe Lieberman brought out security, terrorism, and all the other bugaboos when he argued for the U.S. government to have the ability to shut down the Internet—infamously concluding with the line that, “China, the government, can disconnect its Internet—we need to have that here too.”

State control of the Internet: That’s what Sen. Lieberman meant when he said, We need to have that here too. There’s really no other way to interpret what he said.

What if Lieberman or someone of his delicate sensibilities were to say something like, “Wikipedia is a Systemically Important Website. So we need to be able to take it over—for the protection of the American people and to stop them from being ‘misinformed’.”

Don’t think it can happen? Paranoid, am I?

Then why are Jimmy Wales and his team at Wikipedia shutting themselves down for a day? For kicks?

Or because they think that this is real?

Join Me As I Say: No.

When I was about 15 or 16, I read Solzhenitsyn’s The Gulag Archipelago. The book is a history of the Soviet concentration camp system between 1918 and 1956, based on the testimony of actual prison inmates, of which Solzhenitsyn was one—and it had a profound effect on me, both politically and as a future writer.

But most of all, it taught me something crucial: What is legal is not necessarily the same as what is just.

Because you see, the Gulag system of forced-labor and concentration camps was completely legal: Proper laws had been properly passed, which allowed innocent people to be shipped off to their doom in a properly legal process. Even before the Nazis came up with the Wannsee Protocol, Lenin and his Soviets had perfected the idea of using the law to rape justice and the rights of human beings.

We today look at such abuses of the law as perversions typical of authoritarian and totalitarian regimes—

—but what about in a democracy? What about in our democracy? What about in America?

Recently, the United States’ Congress duly and democratically passed the National Defense Authorization Act (NDAA), which President Obama duly and democratically signed into law.

The NDAA makes it legal for the executive branch to unilaterally declare anyone, including an American citizen, a terrorist suspect. And on merely the strength of this suspicion—not an act, not even a plan, but merely on a suspicion—an accused person can be “detained” indefinitely.

So imagine this: Read more »