Meltdown
You may recall last year’s letter (http://www.ronharrod.com/christmas07.html) included a section on global warming. Indeed, things are heating up. The word meltdown has taken on a whole new meaning. The U.S. government has built a house of cards through relentless intervention in markets, increasingly dishonest economic statistics (CPI, unemployment, etc.), a dishonest fiat currency, a dishonest secretive banking system, and a dishonest budget spinning out of control.

We’re rapidly approaching an economy completely controlled by bureaucrats (can you say politburo?) through the operations of the Federal Reserve, the Treasury Department, and the Working Group on Financial Markets. Wave after wave of government-created crises relentlessly erode our freedom. From Wilson to FDR to LBJ to Bush and beyond, the onslaught continues. The futile “War on Terror” has cost us thousands of lives, has depleted the Treasury, has made air travel a nightmare, and has spawned multiple freedom-robbing PATRIOT acts. Now, the prudent and innocent, against their will, bail out the reckless! Where will it end?

Moral Hazard
We’re hearing much about moral hazard these days. What does it mean? Moral hazard is the motivation to take risk when associated losses are insured by someone else. For example, to protect against the loss of causing an auto accident, we buy auto insurance. The problem is, once we have insurance, we’re less concerned with avoiding an accident. The policy then increases the chance of having an accident.

Today, we see moral hazard as rewarding bad behavior: on a global scale as other nations extend credit to our increasingly reckless and bankrupt country, at a business level as failing corporations line up to have their bad decisions covered by the U.S. taxpayer, and even on a personal level as individual debtors demand and receive “relief” for bad decisions they made related to their debt.

An essential element of a healthy free market, is that both success and failure must be permitted to happen when they are earned. But instead with a bailout, rewards are reversed—the proceeds from successful entities are given to failing ones. How this is supposed to be good for our economy is beyond me. (U.S. Congressman Ron Paul)

Our economy is drowning in excessive debt. What is our response? We create more debt. Let me ask you, what would you do if your house catches on fire? Would you try to put it out with water, or would you spray it with gasoline? Will the wanton creation of debt and support of institutions and processes that created this mess solve the problem? I think not.

History says this bailout scam will surely fail. It encourages bad behavior and therefore satisfies the conditions of moral hazard. After World War I, the Germans were charged with paying for the damage that they caused. They couldn’t afford the massive burden. Their staggering debt far exceeded their means. They resorted to paying with devalued currency. The result was hyperinflation, the rise of Hitler, and World War II. Now, as increasing debt ravages our country, we find ourselves rapidly descending down the same path.

But why do we reward poorly run companies and keep them from failing? Because they say it is better than the alternative—a necessary evil. We must trust their judgment. Whose judgment? The ones who have presided over this ever deepening disaster.

Which leads us to the masterminds behind this current most flagrant example of moral hazard: the Secretary of the Treasury (Henry Paulson) and the Chairman of the Federal Reserve (Ben Bernanke). Together they are attempting to avert a collapse of the U.S. financial system. The status of the U.S. dollar as the world reserve currency hangs in the balance. They’re playing a shell game, by creating money ex nihilo (out of nothing) and using that new money to purchase an increasing portion of U.S. debt obligations.

They’re also creating money (U.S. Treasury debt) to bail out banks and now even failing non-bank corporations deemed “too big to fail.” The Federal Reserve holds this bad debt backstopped by the U.S. Treasury which eventually takes on further debt to cover the creation of more dollars. Once the Federal Reserve holds all of the bad debt, it no doubt will be deemed to “too big to fail” and be bailed out by the U.S. Treasury. As a result, taxpayers will end up holding the bag and paying interest on this crushing “public debt.”

Misters Paulson and Bernanke, you are not God. Only your Creator can make something out of nothing (Psalm 33:6,9; 89:6). There’s a simple law that God wrote long ago, and you will not defy it. It is called the law of sowing and reaping. Unlike their deceptions, this truth is very easy to understand:

Be not deceived; God is not mocked: for whatsoever a man soweth, that shall he also reap. (Galatians 6:7)

If you sow corn, you will reap corn. If you sow wheat, you will reap wheat. If you sow debt, you will reap debt. If you sow deceit, you will reap deceit. If you sow corruption, you will reap corruption. We can see that this wisdom applies to governments and individuals alike.

Morality 101
Is it right to reward bad behavior? What does the Bible say about this? Surprisingly, you will search the Authorized Version of the Bible in vain to find a reference to the word moral. But you will find many references that teach the principles of morality and provide a moral standard.

Let’s see. The Bible says that murder is bad behavior (Exodus 20:13). What does it prescribe as the consequences for murder?

Whoso killeth any person, the murderer shall be put to death by the mouth of witnesses: but one witness shall not testify against any person to cause him to die. Moreover ye shall take no satisfaction for the life of a murderer, which is guilty of death: but he shall be surely put to death. (Numbers 35:30–31)

Okay, that’s pretty clear, but how about stealing (Exodus 20:15)? A lot of what’s going on now in the name of “rescue” amounts to stealing. How does God prescribe we deal with that? Does he say to the thief, “Well done my good and faithful servant, you have been criminal and irresponsible in a few things, let me appoint you as bank president or leader of the nation’s treasury?” No, not exactly:

If a man shall steal an ox, or a sheep, and kill it, or sell it; he shall restore five oxen for an ox, and four sheep for a sheep. …If a man shall deliver unto his neighbour money or stuff to keep, and it be stolen out of the man’s house; if the thief be found, let him pay double. (Exodus 22:1,7)

God says men should engage in fair transactions (Proverbs 11:1; Leviticus 19:35–36; Deuteronomy 25:13–16). He also says the punishment should fit the crime:

And if a man cause a blemish in his neighbour; as he hath done, so shall it be done to him; Breach for breach, eye for eye, tooth for tooth: as he hath caused a blemish in a man, so shall it be done to him again. And he that killeth a beast, he shall restore it: and he that killeth a man, he shall be put to death. (Leviticus 24:19–21)

Causing harm to others is wrong (Matthew 22:36–40). God’s law prescribes retribution for those harmed and punishment for those causing the harm. He also rewards good behavior and punishes bad behavior (Deuteronomy 30:16–20; Romans 2:6–11; Revelation 20:6, 12–15). Of course, all of this makes perfect sense.

Moral Collapse
Clearly, we’re witnessing an unprecedented crisis in morality in this country. We need look no further than our own election process to see the seeds of our decline. While ACORN receives government funding, it actively participates in voter fraud http://rottenacorn.com. Then there’s the abortion industry. To date, over 48 million abortions have taken place since killing unborn children became legal in this country http://www.nrlc.org/ABORTION/facts/abortionstats.html.

Recently, we learned that Bernard Madoff created a hedge fund that turned out to be a Ponzi scheme. The fund paid fictitious earnings using money received from new investors. When the stock market collapsed, investors tried to liquidate. The hedge fund did not have the money. Does this sound familiar? Poor Bernie was not well enough connected to get a bailout. Unlike the big boys, he had to admit the truth about his financial dirty dealings. Could it be that this “biggest Ponzi scheme in history” is just the tip of the iceberg? Time will tell. But when we consider the fundamental dishonesty of fractional reserve banking and the depths to which the Social Security system has descended, this 50 billion dollar lie may look more like very small potatoes in comparison.

It seems the year cannot pass without another outrageous lottery-mentality lawsuit being filed. The trick is to claim to be harmed in some way by an entity with deep pockets. You may recall the lady who sued McDonald’s because she spilled hot coffee on herself. Then of course came the man who sued McDonald’s for being the cause of his obesity. Now just this month, someone has sued Wal-Mart because their relative was trampled to death in the rush for Black Friday specials. Notice they’re not suing the people who actually killed the man. They do not have deep pockets. Wal-Mart does. Everywhere we look it seems there’s someone else looking for a handout and a free ride.

What ever happened to personal responsibility anyway? Regrettably, today more people seem to feel that they have a right to have things but no obligation to pay for them. First, they lie on their loan applications to obtain approval. Then they claim that they did not understand the contract and therefore are not responsible to live up to the agreed upon terms. When they default on their responsibility, they feel it is their right to walk away from it. The Bible calls people who do this “wicked” (Psalm 37:21). To top it off, they retaliate because someone is taking their stuff. Instead of just surrendering what is not rightfully theirs, they damage and pillage the property as an act of final revenge.

We could go on and on, citing statistics for rampant child abuse, domestic violence, sexual perversion of all sorts, drug addiction, illegal immigration, identity theft, cruelty toward animals, break-ins, and the exploding prison population. The problem is, our country has turned its back on God. We’re like a ship without a rudder or anchor—hopelessly racing toward the rocks. In spite of an increasing number of laws, corruption increases. Our forefathers were certainly aware of this dependency.

Our Constitution was made for only a moral and religious people. It is wholly inadequate to the government of any other. (President John Adams, 1798)

And can the liberties of a nation be thought secure, when we have removed their only firm basis, a conviction in the minds of the people that these liberties are the Gift of God? That they are not to be violated but in His wrath? Indeed, I tremble for my country when I reflect that God is just; that His justice cannot sleep forever. (Thomas Jefferson, 1781)

Bankrupt Choice
The election is over. The American people have spoken. But what have they said?

Democracy is a form of government that cannot long survive, for as soon as the people learn that they have a voice in the fiscal policies of the government, they will move to vote for themselves all the money in the treasury, and bankrupt the nation. (Karl Marx)

A corrupt people will not elect righteous leaders, but instead will select representatives who reflect their own depravity. President-elect Obama and a supportive Congress will give us change. That’s the problem. These folks do not hold the traditional view of America. They use high-sounding terms like economic justice, diversity, tolerance, and various rights in an attempt to elevate their morally bankrupt causes. Let’s examine a few.

(1) Economic justice (so called) is simply a form of economic tyranny and is nothing new. Barak Obama said,“…I think when you spread the wealth around, it’s good for everybody.” He also freely throws around the expression the common good. Where have we heard this kind of language before?

From each according to his ability, to each according to his needs! (Karl Marx)

How does this kind of thinking line up with the Bible?

For even when we were with you, this we commanded you, that if any would not work, neither should he eat. For we hear that there are some which walk among you disorderly, working not at all, but are busybodies. Now them that are such we command and exhort by our Lord Jesus Christ, that with quietness they work, and eat their own bread. (II Thessalonians 3:10–12)

(2) Religious tolerance is just a code-phrase for Christian intolerance and erasing our Christian heritage.

Whatever we once were, we’re no longer just a Christian nation; we are also a Jewish nation, a Muslim nation, a Buddhist nation, a Hindu nation, and a nation of nonbelievers. (Barak Obama)

What does the Bible say?

Blessed is the nation whose God is the LORD: and the people whom he hath chosen for his own inheritance. (Psalm 33:12)

Jesus saith unto him, I am the way, the truth, and the life: no man cometh unto the Father, but by me. (John 14:6)

How sad that these leaders fail to understand that when we turn our backs on God, we face sure destruction. Our crumbling economy, our worthless dollar, and even our mighty military cannot save us.

Woe to them that go down to Egypt for help; and stay on horses, and trust in chariots, because they are many; and in horsemen, because they are very strong; but they look not unto the Holy One of Israel, neither seek the LORD! (Isaiah 31:1)

The earth also is defiled under the inhabitants thereof; because they have transgressed the laws, changed the ordinance, broken the everlasting covenant. Therefore hath the curse devoured the earth, and they that dwell therein are desolate:… (Isaiah 24:5–6a)

(3) Reproductive rights refers to the barbaric and savage notion that a mother may elect to kill her unborn child.

It is the policy of the United States that every women has the fundamental right to choose to bear a child, to terminate a pregnancy prior to fetal viability, or to terminate a pregnancy after fetal viability when necessary to protect the life or health of the woman. (from the Freedom of Rights Act cosponsored by Senator Obama)

Again, the Bible sees things much differently.

Whoso sheddeth man’s blood, by man shall his blood be shed: for in the image of God made he man. (Genesis 9:6)

(4) Gay rights refers to the idea that homosexuals, by virtue of their attested sexual practices, have special rights and protections above those granted to people who do not embrace the bondage of that particular sin. This movement also seeks to elevate the sin of homosexual behavior to an approved and honorable status.

I don’t think that homosexuals are immoral any more than I think heterosexuals are immoral. (Barak Obama)

Apparently Senator Obama appeals to some standard other than the Bible for his definition of sexual morality:

Thou shalt not lie with mankind, as with womankind: it is abomination. (Leviticus 18:22)

For this cause God gave them up unto vile affections: for even their women did change the natural use into that which is against nature: And likewise also the men, leaving the natural use of the woman, burned in their lust one toward another; men with men working that which is unseemly,…, God gave them over to a reprobate mind, to do those things which are not convenient; (Romans 1:26–28)

Marriage is honourable in all, and the bed undefiled: but whoremongers and adulterers God will judge. (Hebrews 13:4)

The Messiah
In spite of their lofty aspirations, neither Barak, Ben, nor Henry can save us. Christmas celebrates the good news that the true Savior humbly entered this world to rescue us from our bankrupt condition.

For ye know the grace of our Lord Jesus Christ, that, though he was rich, yet for your sakes he became poor, that ye through his poverty might be rich. (II Corinthians 8:9)

But God, who is rich in mercy, for his great love wherewith he loved us, Even when we were dead in sins, hath quickened us together with Christ, (by grace ye are saved;) And hath raised us up together, and made us sit together in heavenly places in Christ Jesus: That in the ages to come he might shew the exceeding riches of his grace in his kindness toward us through Christ Jesus. (Ephesians 2:4–7)