Biden Goofs, Ukraine, and Interest Rates: Last Week in Liberty 9/25/22
Ladies and gentlemen, welcome back to Last Week in Liberty. Another week has passed, which means that lots of things have happened in the world since last we spoke. It’ll be a busy one, so let’s get into it:
Joe Biden, renown for his clear thinking and ability to inspire confidence, seemed to indicate last week that the United States would defend Taiwan in the event of a Chinese attack. The White House later released a statement rebuking the president’s comments (again…), saying that the U.S. policy of Taiwan has not changed. This is interesting for a number of reasons:
- Another Joe Biden gaff. Let’s all laugh at the geriatric old man who we call “Mr President”.
- U.S. policy towards Taiwan has always been (as we discussed last week) that of strategic ambiguity, where it is never supposed to be stated whether or not the U.S. would actually defend Taiwan. The idea is that the U.S. gets the benefit of deterring China from attacking, without the downside of actually having to make a commitment to defend the island.
- With a greatly increased presence of the U.S. in the South China Sea and increased support for Taiwan, there is an interesting question to be asked: is this just Joe Biden’s dementia talking, or is could it be him accidentally spilling the beans on what U.S. policy actually is now? Could it be that the U.S. is maintaining the face of strategic ambiguity, but behind the scenes is actually committed to defending Taiwan? I don’t have any answers, but they are tantalizing questions nonetheless.
In other news, Guantanamo Bay may finally be shutting its doors for good. The world’s worst hotel has been open for business ever since being started by Bush in 2002 as a place to house their prisoners from the War on Terror. Obama ran in 2008 on ending it, but never did. Trump kept Guantanamo in operation, and Biden has also continued it thus far. However, according to a report from The Libertarian Institute, the Biden Administration has been silently making moves towards emptying the offshore prison and closing it once and for all.
While seeing Guantanamo Bay closed would be a victory for allies of liberty everywhere, it would be coming 20 years too late. The vast majority of prisoners it held have never been tried with any crimes, a blatant violation of Habeas Corpus. While the Bush Administration tried to argue the Constitution doesn’t apply to Guantanamo and that the detainees have no rights, the entire operation of the prison is a clear violation of human rights. It is a stain on American history, and should never have been opened. We can only hope that the Biden Administration will actually have the follow-through to end it once and for all.
(Human Rights Watch has a great Q-and-A section that I recommend you read for more information about Guantano and its history if you are interested.)
If there is one thing that government is known for, its accountability. Unfortunately, it seems if there will be a little less accountability on Capital Hill in the coming years. The State Department announced that it will no longer publish the World Military Expenditures and Arms Transfers (WMEAT) reports. These reports detail the spending of the U.S. government on military, armaments, and other similar expenses. The question is, of course, why suspend these reports now? While we can only speculate, it almost certainly has to do with the billions of dollars of equipment and weapons pouring into Ukraine. The U.S. has previously said that they have virtually no way of tracking the weapons they send to Ukraine. Perhaps this is a move to help cover up their tracks in case some of those weapons end up in the wrong hands?
More news this week from the War in Ukraine: this past week, Vladimir Putin officially mobilized 300,000 more troops to be deployed in the “special military operation” in Ukraine. As I said in last week’s LWIL, the Ukrainian offensive in the north seems to have prompted Russia to escalate the war to finish the Ukrainians off once and for all. Ukraine has managed to hang on against Russia with the limited scope of the war that Putin has committed to thus far, but it seems doubtful that they will be able to resist the onslaught of 300k more Russians being hurled at them.
Ultimately, the War in Ukraine is a story of pure tragedy. Everything the West does to help them ends up leading to further pain and destruction for the very Ukrainians they are ostensibly trying to help. The U.S. supports the coup in 2014 to gain greater independence from Russia, which results in heightened tensions. The U.S. sells them weapons and flirts with inviting them to NATO, which results in the war they are fighting now. The U.S. continues to give them massive stockpiles of weapons, which enables them to conduct their latest offensive, which results only in an escalation of fighting by Russia. How the rest of this war will shake up, nobody knows. One thing is for sure: there is still plenty of death and destruction ahead.
In economic news, the Federal Reserve raised its federal funds rate by .75% this week. This continues a trend of the Fed pursuing a tighter monetary policy, with this being the second consecutive rate hike of 75 basis points. In coordination with the announcement, stock markets took a tumble which continued on for the next several days to end the week down almost 1,000 points on the Dow Jones.
Jerome Powell, the current Fed chair, has remained steadfast in his commitment to fight inflation, even if it leads the economy into recession. With the economy showing signs of slowing down (two consecutive quarters of negative GDP, falling stock market, inverted yield curve, etc.), the implication from Powell is that a recession is on the way and that investors should prepare for it. The much touted “soft landing” that Powell droned on about in previous months seems to be a forgotten fantasy now. When will the crash come? Nobody knows, but it might be sooner than you think.
Protests have recently erupted in Iran over the issue of the morality laws that are enforced upon the female population. Women in the country are required by law to wear a hijab whenever out in public, which has been a large part of the focus on these protests. Videos have flooded social media of women burning their head scarfs, fighting with police, and marching in protest against the regime. In response, counter protests have also taken to the streets as well in support of the morality laws.
Will these protests lead to actual change within the country? Unfortunately, probably not. The majority of the country still supports the current politic system and Islamic-based code of law. Younger generations, especially women, seem to be less enthusiastic, but tangible change still seems like it might be a long way off.
A few more interesting links from the last week:
- A report detailing of how Biden’s student loan repayment plan would lead to subsidies to gender studies degrees and penalize those who earn STEM degrees
- A great Twitter thread detailing the legion of crimes by the CIA over all its years of existence
- A Reason article on the actual truth behind the idea of low teacher pay
Quote of the Week: “Who wants good people in government? Good people should be in the private sector. Helping us out, helping themselves out in the private sector. We want schmoes in government. We want people who can't find the doorknob. Why waste productive people, as well as looting the taxpayer?” - Murray Rothbard
That’s all for this week friends. We’ll be back here next week, and I’ll see you all then. Bye for now!