Editor's Note: I have been traveling in the mountains surrounding Medellin, Colombia and have just caught up with Doug in Salta, Argentina, but unfortunately, not soon enough to get this issue done on time to get it published yesterday. As much as Doug and I both travel, it's amazing that we've been able to do this so long and not miss a beat – thank goodness for the aptly-named world wide web! But still, we aim to deliver, not to make excuses. I am truly sorry for the delay. L
L: Doug, we spoke about holidays in general last time, but I've heard you say, specifically, that you find Presidents' Day particularly objectionable. I know that's not just you being a gadfly, but a comment driven by your study of history and your thinking on psychology, sociology, and economics. It seems worth following up on.
Doug: Yes, that's true. For one thing, as we discussed in our conversation on anarchy, political power tends to attract the worst of people, the four percent of any society that's sociopathic. So declaring holidays to honor these people is a tragic mistake in and of itself. It, like so many things are in our world, is completely perverse, as people celebrate and reward mass murderers, industrial-scale thugs, and con-men who fleece entire societies.
Who is studied and idolized in the history books? Is it people like Edison, the Wright Brothers, Leonardo, Newton, Ford, or Pasteur? Not really; they just get a passing nod. The ones who get statues built to them and are engraved on the collective memory are conquerors and mass murderers – Alexander, Caesar, Genghis Khan, Napoleon, and a whole bunch of U.S. presidents.
L: Do you ever get to thinking that perhaps people get the government they deserve?
Doug: I do indeed. People who vote for free lunches – knowing full well that someone needs to pay for them, and they are fine with that as long as the someone is someone besides themselves – deserve to become tax slaves for those who view them as milk cows. If economically ignorant, greedy, and shortsighted people vote for bad government, they should start by looking in the mirror when they wonder what went wrong. But few people are that introspective. Further, most people apparently lack a real center, an ego in the good sense. That's why they create these false gods to worship; by becoming part of a group, they think they gain worth. Pity the poor fools…
There's no doubt in my mind that the U.S. has devolved to that level. Something like 43 million people get their food from the government, about half of workers pay no income taxes (although I wish no one did, of course), about half are significant net recipients of government funds… and many millions more are employed directly by the state. It's why I no longer refer to "America" when discussing the U.S. – America was a wonderful idea, which unfortunately no longer exists.
A bad leader can bring out the worst in people, making them think the government is a cornucopia; and then the people demand more of the same from future leaders. It's a downward spiral – never, for some reason, an upward spiral. It's why, after Augustus, Rome never returned to being a republic, even though they pretended – just like the U.S. does today. My conclusion is that people basically get the kind of government they deserve. Which is a sad testimony to the degraded state of the average person today.
L: Okay, but as far as presidents go, and as much as I wish everyone valued freedom more than (imagined) guaranteed comfort, the fact seems to be that most people need leaders to prod them along into at least somewhat effective action. I don't know why – perhaps it stems from childhood needs for heroes who show us that the world can be tamed and life secured. Whether it be a company CEO or a club president, people often seem to work more effectively in groups with hierarchical structures and strong leadership at the top.
Doug: Well, first, it may seem that way simply because that's the way it is now. But I don't have a problem with hierarchies per se; it depends on the kind of hierarchy.
I'm not opposed to leaders or leadership. Leaders are an organic part of society; all mammals that live in groups appear to have them. They're essential for group effort. Natural leaders arise because of their competence, intelligence, wisdom and virtues. I am only opposed to coercive leadership – the kind where you must follow orders or be punished. I prefer a society where peer pressure, moral opprobrium, and social approbation get people to do things – not laws and penalties. A formalized political structure doesn't draw natural or benign leaders so much as thugs who are interested in controlling other people.
L: And once an establishment gets in place, they try to cement themselves there with laws…
Doug: Exactly; they don't want their rice bowls broken. But more than that, the way most people raise kids in an authoritarian family structure with the father at the top, educate their children, with teachers who must be obeyed and powerful figures like school principals at the top, and send them off to work for hierarchically organized companies with, as you say, presidents and CEOs at the top, it's no surprise that most people think the world must be organized into hierarchies with some ultimate authority at the top.
But as you know first hand, there are ways of parenting that don't revolve around a family structure that's a mini-dictatorship. As we discussed in our conversation on education, there are ways to teach young people that don't involve submerging their impressionable egos in rigid, bureaucratic, authoritarian "school systems." And there are ways of organizing companies and other very effective organizations that have very little hierarchy.
L: Casey Research, for one. You never tell me what to do, just ask me for results. And I taught my kids reading, writing, and arithmetic without relying on punishment. These things are not just theories to me, but ways I live my life.
Doug: And of course, I believe there are ways of organizing effective societies that don't revolve around a central authority structure or leader. Personal responsibility is what it's really all about. Such freer societies centered on cooperation – through markets, rather than coercively through the state – would be much healthier, richer, more just and moral societies to live in.
So, of course, I object to anything that tends to prop up authoritarian ways of organizing society. Celebrating presidents – even the less stupid, evil, and destructive ones – is counterproductive to the direction I'd like to see society evolve, and incidentally, the direction I think it is evolving. President's Day is one holiday that deserves to be abolished absolutely.
L: Understood. But we don't have to rehash the conversation on anarchy. Hm. I'm sure you've got a long list of evil, stupid, and destructive U.S. presidents – probably most of them, in one way or another – but what about the good ones? Or the less bad ones – who's your favorite president and why?
Doug: Well, start with the caveat that they were all flawed. Plato's ridiculous notion of the Philosopher King is an illusion – that type of person wouldn't dream of being a president, because he'd realize that you shouldn't control other people. That said, I like guys like Chester A. Arthur, John Tyler, Calvin Coolidge, and Grover Cleveland.
But we should define what constitutes a good president. In my view, it would be one whose actions resulted in peace, prosperity, and liberty for the country. Peace means no foreign wars; war is the health of the state. War is the meat that feeds the beast. Prosperity means extremely low taxes and regulation, and a peaceful environment where enterprise can flourish. And liberty means being able to do what you wish, as long as you don't violate other persons or property.
Perhaps my favorite ought really be William Harrison, because he only ruled 32 days before he died from a cold in 1841. He had no time to do any damage.
L: [Chuckles] I'd bet most Americans don't even remember that there was a president by that name – the true mark of a great president.
Doug: What about you, Lobo, who's your favorite president?
L: I can't quite bring myself to believe that any man could win the ultimate pandering contest and be an individual of real integrity, so none are heroes in my eyes. That said, I do find myself persuaded by the argument Larry Reed used to make back when he ran the Mackinac Center for Public Policy, that Grover Cleveland might have been the best of the lot. He was a sound-money advocate, generally pro-market, and had both the personal ethics and the backbone to face down Congress and the powerful interests behind the annexation of Hawaii.
The conquest of Hawaii, in my opinion, was one of the most shameful episodes in U.S. history, because of the massive level of fraud and deceit involved, which was quite different from the relatively simpler xenophobic extermination of other natives. Grover Cleveland basically said that Hawaii would never be annexed while he was president, and that's exactly what happened.
Doug: I remember that story.
L: I also have to give credit to George Washington, in spite of the major turn down the wrong road he took for the whole country when he suppressed the Whiskey Rebellion by force, because he could have set himself up as king after the first American Revolution – and he didn't.
Doug: He had the army, was very popular, and he could have done it – I agree, he could have made himself king, or been reelected until his death. But I can't forgive him for crushing the Whiskey Rebellion; that set the precedent for federal taxation and power that eventually led to the Civil War and the bloated monster in Washington that has now burst almost all of its chains.
L: So, who was the worst president?
Doug: That's a really tough question to answer, because there are so many deserving candidates for that title. A short list would have to include McKinley, Teddy Roosevelt, Wilson, Hoover, FDR, Truman, Johnson, Baby Bush, and Obama. But I'd have to say Lincoln was by far the worst. He plunged the country into a totally unnecessary and immensely devastating war, and violated every important part of the Constitution. But he was such a great rhetorician that he made Americans feel good about all the horrors he brought about, setting a doubly bad precedent.
L: I think I know what you'll say, but for our readers who are used to hearing Lincoln described as some sort of saint, and probably America's greatest president, can you expand on that? He preserved the union and freed the slaves…
Doug: The union was not preserved. A union of free and sovereign states was cemented into a single super-state, in which each individual state became nothing more than an administrative region. Who's to say that a bigger U.S. was a better one anyway? This Civil War was really the Second American Revolution. Anyway, it wasn't a civil war, which is technically a contest for the control of a single government; it was a war of secession, like that of 1776. I'm no fan of the Confederacy, but the wrong side won, overthrowing the federal organization that restrained national power, maximizing political and economic freedom.
L: Not for the slaves.
Doug: No, not for the slaves. But slavery was an uneconomic institution that was on its way out anyway – the Industrial Revolution was about to put an end to it in the U.S., just as it did most everywhere else around the world. Brazil was the last major country to be done with it, in 1888, and its abolition was peaceable everywhere but in the Land of Lincoln. And Lincoln was not an abolitionist – he didn't give a fig for the plight of the slaves. His "emancipation proclamation" freed the slaves only in the south. Its real purpose was to incite the slaves to rebellion in the south and weaken his enemies, and to enlist the support of the abolitionist movement in support of his disastrously expensive and unpopular war.
L: Lincoln, the great emancipator, was also the first president to institute the draft, impose a federal income tax, and to smash opposition press (literally, sending soldiers to break their printing presses into kindling).
Doug: That's all true, although George Bush Jr. arguably had the potential to be an even worse president. At least Lincoln was intelligent and articulate. Baby Bush was stupid, evil, pig-headed, thoughtless, and hugely destructive.
L: So, was Bush Jr. worse than, say, Obama?
Doug: I'm not sure – Obama could be worse. He's smart and persuasive, like Lincoln, which makes him very dangerous, because his ideas are totally destructive. He's not just doing all the wrong things, but exactly the opposite of the right things – and not just economically, but in every field. Obama could well be the president who pushes the U.S. over the edge.
One major problem is that people conflate a president's style and personality with his quality as a leader. An example of that is Teddy Roosevelt. He was athletic, personally brave, a great outdoorsman, a prolific writer, something of an intellectual – the kind of guy who would make for an altogether amusing dinner guest. But he was also a militarist, an imperialist, and a complete economic fascist. Teddy the Trust-Buster, popularized the idea that business is evil from his "bully pulpit." He gets an A+ for charisma and style, but an F- if you value peace, prosperity, and liberty.
There's a lot of similarity with his relative, FDR, who was a total and complete disaster on absolutely every front. Of course one can argue FDR was just a man of his time – his contemporaries were Hitler, Stalin, Tojo, Mussolini, Chiang Kai-shek, Mao, Peron, and Franco, among others. All of them, and other world leaders at the time, were cut from basically the same socialist/fascist cloth. FDR just cloaked most of his depravations in traditional American rhetoric – "reforming" capitalism in order to "save" it and similar nonsense.
Reagan was a fairly good president in terms of his rhetoric – but like Roosevelt, one can argue he was also a man of his time, because all over the world, in the UK with Thatcher, China with Deng, Argentina with Menem – everywhere really – there was a lot of free-marketization and reduction in taxes. But Reagan also started putting deficits and increases in the military into hyper-drive. And those are trends that will prove nearly as disastrous as some of those started by Roosevelt. Reagan is a bit like Jefferson – he talked the talk, but didn't walk the walk.
What about you – who would you pick for the worst U.S. president of all time?
L: Well, I have to say I have an abiding dislike for Bill Clinton, who, among other crimes, used tax money stolen from me to bomb friends of mine in Serbia – civilians. But I think that after Lincoln, whom you've already discussed, FDR was probably one of the worst. The New Deal was almost a Third American Revolution, a sweeping wave of socialism that changed America forever, both attacking and undermining the individualism and independence of the American people as well as setting the country on a path to economic self-destruction, the endgame of which I believe we are now entering into.
Doug: I'd have to agree with you there, FDR was perhaps the second worst. Wilson was perhaps the third worst, for getting the U.S. into a totally pointless world war that he promised to keep the U.S. out of, and thereby both greatly increasing the scope of the destruction, and also setting the world on the path to WWII. It was also on his watch that the Federal Reserve was set up and the income tax initiated. Of course the slippery slope had already stated getting steeper when a dead president was put on our money for the first time, in 1909, with the Lincoln penny.
And, going back to Jefferson, he set up a terrible precedent for socialized education in Virginia with the University of Virginia and made the unconstitutional Louisiana Purchase. Great writer and thinker, but he turned into Mr. Hyde once in office – there's much more that was bad about him that made him a mediocre president, at best.
L: On the other hand, he did oppose the slave trade. And I have to admit, I admire him for all of his inventions.
Doug: That was a pretty courageous thing to do at that time – but it would have been even more courageous to free his slaves while he lived and then protect them.
L: Can't argue that. What about today, see any candidates out there who don't seem stupid, evil, or destructive to you?
Doug: No. I'd like to say Rand Paul, but although he's riding on his father's coat-tails, he appears to be just another weakly principled Republican, who seems to think "supporting our troops," promoting "traditional values," and thumping the Bible will somehow restore peace, prosperity, and liberty to the U.S. I hope that's an unfair assessment of the guy, but I think not, because the longer people spend in Washington, the more corrupt and conventional they tend to become. As a lone voice, his father was a breath of fresh, more principled air, but he didn't change anything at all that I can see; the U.S. has continued headlong for the economic and social cliff he saw as clearly as I did.
L: A pity.
Doug: Maybe, or maybe not. If he'd made more of a difference, it might have encouraged other good people to enter politics, instead of doing something useful with their lives –might have helped prolong the false belief that anything good can come from politics. At this point, I don't think we're going to see any meaningful constructive change until the U.S. government itself implodes. Which is very likely to happen this decade. The problem is what comes next… We're in for truly interesting times.
L: I should have known you would say that. Okay – investment implications.
Doug: The track records of the best and worst presidents in America's history might seem irrelevant to today's problems, but you know what they say: those who ignore history are doomed to repeat it.
L: [Chuckles] Or, even if history doesn't actually repeat, it often rhymes.
Doug: Right. Which leads to almost all of the conclusions we've come to in our coverage of the ongoing global economic train wreck in The Casey Report.
L: Quick summary?
Doug: See our past conversation on surviving the economic crisis: liquidate, consolidate, speculate and create. And, of course, diversify your political risk.
L: Roger that. And Marin in energy, Alex in technology, and I in metals will do our best to help with the "speculate" part, in addition to what you cover in The Casey Report.
Doug: I just hope people are listening, because that endgame – the Greater Depression – has started already and will soon get much worse. And all the evidence suggests that it's going to be much worse than even I think it will be.
L: Understood – we'll do our best to help people prepare for, and even to prosper, in the hard times to come.
Doug Casey and his fellow editors of The Casey Report have one common goal: to analyze and reveal the machinations of the political-economic engine and help subscribers seize the profit opportunities that arise from them. Even in times of crisis such as those we're currently in, smart investors can make money. Read more here.