Herbert London

Herbert London is the author of Decade of Denial (Lexington Books), America's Secular Challenge (Encounter Books) and most recently Diary of a Dean (Hamilton Books), and publisher of American Outlook. He can be reached at: www.herblondon.org.

From Coming Boom to the Coming Gloom

In a book entitled the Coming Boom by Herman Kahn published in1982, Kahn argued that despite the double digit inflation of the Carter years and the "stagflation" that plagued the period from roughly 1976 to 1981, an economic boom was just over the horizon. As it turned out Kahn was right as the ensuing Reagan years ushered in a period of economic growth and vitality.

What Herman Kahn observed in the book was the following: tight monetary policies would lead to high interest rates and a decrease in inflation; deflationary trends lead inevitability to a more efficient use of energy; issuance of long-term bonds will allow the government to tap into new markets; the demand for all commodities will increase dramatically due to pent up opportunities; debt relative to GDP is small; output of workers is likely to increase; the lag between invention of technology and commercial application is shortening; the U.S. is emerging as the globe's undisputed military power and, most significantly, a psychology of achievement and affluence is emerging that provides full confidence in the future.

These claims reinforced Herman Kahn's view that boom times were coming. But I wonder what Kahn would say today? The recent congressional debt limit debate gave the country an opportunity to assess where we stand and, by my lights, was a moment for gloomy predications. My chronic optimism serves as a modest counterweight, but the evidence provided in this piece speaks to conditions very different from 1982, most especially the sense of weltschmerz that dominates the present debate about the nation's finances. But there is more, much more that should be considered.

The debt of $14 trillion is almost equal to GDP. Dollars put into circulation have increased by 50 percent since 2008, an obvious effort to monetize the debt. The unemployment rate at the moment is 9.1 percent; however if you include those no longer seeking employment, the rate is over 15 percent (13.7 million Americans are unemployed and 989,000 have given up looking for working). Overall there are 6.4 million in the long-term unemployment category. The unfunded liability for Medicare, Medicaid, and Social Security is $117 trillion, approximately $17 trillion for Social Security, and $90 trillion for Medicare and Medicaid. That aggregate total is more than all the registered wealth on the globe. The CBO (Congressional Budget Office) predicts the debt in 2020 will be $20 trillion. The sum necessary to finance a debt of that magnitude is roughly equivalent to today's defense budget.

The anticipated U.S. fiscal budget for 2011-2012 has revenue at about $2 trillion and expenditures at $3.7 trillion with a deficit of $1.7 trillion, the largest in U.S. history. This deficit is four times greater than the one in 2008. Moreover, this figure does not take into account pension liability, which is unfunded at the state level, and accounts for another $1 trillion.

As of February 2011, the last date on which figures were available, 44.2 million Americans are on foodstamps, approximately one in seven people. Forty-seven percent of Americans do not pay personal income tax. Thirty-six percent of Americans, who file tax forms do not pay. About 142 million Americans who filed did not pay anything in 2009. Income level, nominal and actual, above $50,000 declined from 2008 to 2010, with the most precipitous decline in the $100,000 to $150,00 category. The number of those in poverty has increased 9.5 percent since 2009 with a total of 43.6 million total. China presently holds $1.14 trillion in American securities, a condition that could put American financial interests at risk.

There were 89,000 people who received checks from the Stimulus program who were dead or in prison, and 3,700 tax delinquents who received stimulus funds. The individual share of the national debt is $46,000. Gold has gone from $853 a troy ounce in 2009 to $1,800 today, a condition that bespeaks uneasiness with U.S. markets. Household income has decreased by .7 percent since 2009 and there has been an increase of 17.1 percent in bank failures since 2009.

By any measure these statistics paint a gloomy picture, one that suggests the nation is at a crossroads. If you focus solely on the debt, it is easy to overlook the most fundamental problem. This nation faces a crisis not because taxes are too low but because government is too big, too intrusive, and too dominant.

If there isn't any change in federal policy, if we continue down the road we are on, any extrapolation of the numbers leads to be a disastrous result. By 2050, according to the CBO, spending will exceed GDP by 42 percent. How can our liberties remain intact when government controls such an extraordinary portion of the economy? Yet any discussion of entitlement program reduction is considered the third rail in American politics. This disparity between political sensitivity and economic reality has to be addressed by a Congress that understands the problems but is resistant to real reform.

If the Tea Party movement stands for anything it is the belief that the growth of government imperils freedom. That is an understanding Americans must imbibe. However there is the danger the United States has reached a Platonic tipping point at which the number of takers, i.e. outliers, is far greater than the number of givers, i.e. tax payers. This is not a scenario for democracy's survival. And yet, I maintain a faith in national resilience. At some point, I believe the public will awaken to the economic threat and force the Congress to act appropriately.

As I see it, we've gone from the "coming boom" to the "coming gloom," but what lies over the horizon remains undetermined.

The Walls That Divide Europe

It is something of an old chestnut that "good fences make for good neighbors," but it is also true that walls often keep people in and usually keep people out. This was true of the Berlin Wall constructed in 1961, and it is true of the walls being erected throughout Europe today.

These contemporary walls operate under the name of "no go" zones, areas that are off limits to non-Muslims. These zones function as microstates governed by Sharia. In many locations from Malmo to Hamburg, from Liverpool to Rotterdam host country authorities have lost effective control over these zones and in many instances are unable to provide even basic public aid such as police and fire assistance and ambulance services without permission from the local imam.

Here in unvarnished terms are the influences of multicultural policies that encouraged Muslim immigrants to live in parallel societies "walled in" through a desire for separation and the host's desire to avoid integration.

In Britain, for example, a Muslim group called Muslims Against the Crusades, has launched a campaign to convert twelve British cities - including Londonistan - into independent Islamic states. In the Tower Hamlets area of East London extremist Muslim preachers routinely issue death threats to women who refuse to wear Islamic veils. Neighborhood streets are plastered with posters declaring "You are entering a Sharia controlled zone; Islamic rules enforced." The Muslim extremist Abu Izzadeen heckled the former Home Secretary John Reid by saying, "How dare you come to a Muslim area."

At last count the French police maintain there are 751 "no go" zones (Zones Urbaines Sensibles, ZUS) listed on the French government website. And mosques in Paris have been broadcasting sermons and chants of "Allahu Akbar" via loudspeakers into the streets. By any stretch, this represents an occupation force in France.

In a widely publicized event, fire fighters in Malmo, Sweden, were attacked by Muslim stone throwers in their effort to extinguish a fire in the town's main mosque. The argument for the disruption was that the fire fighting team did not obtain permission from the imams to enter "their" community. According to Malmo-based Imam Adly Abu Hajar: "Sweden is the best Islamic state."

These walls that divide are having a profound influence on European societies. Muslim extremists employ the separation as a tactic to proselytize, and Europeans often describe these zones as evidence Muslims cannot be integrated. The governments in question, eager to maintain stability, acquiesce in favor of the multicultural position. However, the acquiescence does not yield an expected result. The "no-go" zones breed hostility; these areas are timebombs waiting to be set off by even relatively benign circumstances.

For decades the Berlin Wall was a symbol separating two worlds: freedom and dictatorship. It is instructive that the new walls separate liberal values from notions of religious extremism in a manner not entirely dissimilar from the past. Guns, tanks, and barbed wire do not separate "no go" zones from host societies, but the separation is real and no less dangerous.

A Palestinian State? What Does the Evidence Suggest

With a vote on statehood about to come before the United Nations' General Assembly in September it is incumbent on those who will consider this proposal to examine several facts. A recent report by Itamar Marcus and Nan Jacques Zilberdik makes the following points:

* The Palestinian Authority pays monthly salaries to 5,500 prisoners in Israeli prisons, many of them known terrorists;

* The P.A. honors terrorists who have killed civilians, presenting them as heroes and role models;

* The P.A. glorifies terror attacks as heroic, including suicide bombings;

* Funding for these salaries and activities comes from the general budget to which the U.S. contributes;

* U.S. law prohibits funding of any person who engages or engaged in terrorist activity.

At the moment Hamas and Fatah terrorist prisoners are receiving monthly checks, a total of almost 18 million shekels ($5 million) monthly. In fact, it pays to be a terrorist since these monthly stipends are more than the average salary for a P.A. civil servant or military officer.

While this practice is going on, Secretary of State Hillary Clinton stated that an additional grant to the P.A. will be made bringing U.S. direct budget assistance to a total of $225 million annually. Of course, neither the American public, nor most members of Congress are aware that a substantial portion of this foreign aid goes to support terrorists. My suspicion is that even Hillary Clinton does not know that a P.A.-sponsored summer camp for children is divided into three groups named after terrorists Dalal Mughrabi, Salah Khalaf, and Abu Ali Mustafa, each of whom planned and executed murders against civilians. My suspicion is that the Secretary of State does not know that Prime Minister Salam Fayyad, a man who she described as a moderate, routinely honors terrorist bombers on his radio broadcasts.

That these practices go on with U.S. subventions is outrageous. The P.A. is in direct violation of our laws and all salaries to imprisoned terrorists and money that honors terrorists should cease immediately. But there is also another lesson in these revelations. Despite all of the rhetorical anodynes from the Obama administration, terrorism is the modus operandi of the P.A. The creation of a Palestinian state is ipso facto the creation of a terrorist state with one goal, the destruction of Israel.

Despite all of the gamesmanship at the U.N., despite President Obama's assurance about adjoining states living in peace, the P.A. and its Hamas partner will not repudiate their goal of destruction and will not recognize the legitimacy of the Jewish state. General Assembly members may be convinced that a newly created Arab state can live in peace with its Israeli neighbor; after all, petrodollars are very alluring, But the evidence that a narrative of violence is encouraged, alas funded, militates against an irenic scenario.

As I see it, the time has come for the United States to tell the truth about the West Bank and Gaza. We may not persuade Security Council members that this entire statehood enterprise is misguided, but at least we can state the American position clearly and unequivocally. As long as terrorism prevails, as long as it is cultivated by government authorities, there will not be, there cannot be, a Palestinian nation. If a day comes when Israel lays down its arms, destruction will follow; if there is a day when the Palestinians repudiate terrorism, peace will follow. The alternatives are clear. The question, of course, is whether anyone is listening.

Venice: A City of Dreams

Venice is more than a city, it is in fact the embodiment of the human spirit. Each day nature sends rising tides to test the resilience of this remarkable place. Barriers have been placed at sea as a prophylactic, but nature is relentlessly testing Venetian mettle.

It is hard to believe that this island metropolis is built on piles and stands below sea level. When the rainy season begins, Piazza St Marco becomes a lake that is negotiated with a rowboat. Venetians take this for granted. Every native has a pair of floaters in anticipation of flooding. Yet there are very few that would change places with those on the mainland as the escalating price of property suggests.

Tourism is yet another annual challenge. Carrying their backpacks and fanny packs, hordes march through the narrow streets in search of Tintoretto, gelatos, gondola rides, and the romance of Casanova. It is amazing that the Bridge of Tears can tolerate the weight of photographers trying to capture a moment of the past for the family album. Since there isn't any rhyme or reason for the street design, tourists are in a perpetual state of confusion. I encountered a couple from Boston who kept returning to the same spot even though they claimed to be taking a different route over an hour of desperate turns.

Of course, getting lost in Venice is one of the great joys in life. There is always a church you haven't encountered before. Or maybe you find the piazza in the movie "Summertime" where Kathryn Hepburn fell in the canal only to be rescued by Rossano Brazzi.

Venice surprises. Like the masks worn at Carnivale, the real Venice hides behind upscale shops and museums with priceless artistic work. In November, when fog engulfs the city and drizzle is in the air, the real Venice appears. Without motor vehicles, the sound of the city is bells. The tourists are in distant places. Stores are closed. The silence is breathtaking; the city is in hibernation soon to awaken in June when the tourists leave the train station and hop on the vaparetos along the Grand Canal.

In June the flowers are in bloom, water taxis have been removed from building caves and the gondoliers are given a lease on life. This is the beginning of the commercial boom, a period of prosperity that lasts about four months. For most Venetians, you make it then or you don't make it.

While Venice lives in the past, it is not immune to fashionable opinion. On the Piazza Stefano can be found the Open University of Diversity. The Guggenheim museum features modern art arguably too vanguardish for the Whitney. And every Venetian has a cell phone in perpetual use. It is the Italian way.

Yet what most find appealing is not the present, but the past. The Dogi Palace and the Galileo Tower attract many more tourists than the Guggenheim Museum. Even the Jewish ghetto tells a story of oppression and recovery over centuries. Four hundred Jews today keep the story of the Jewish Venetian past alive.

Venice speaks to history. Napoleon was a benefactor for the great centers of artistic achievement. Leaders from around the globe gravitated to this center of canals. There are cities with more canals than Venice - Amsterdam being a classic example - but none possess the mystery, the intoxicating sensuality of Casanova's birthplace.

As the gondoliers paddle their way along the canals "Volare" is played on recording devices. It is hokey, but confirms a stereotype for first time visitors. Yet there are few moments more rewarding than sipping a cold Bellini with real peach juice on the balcony off the Grand Canal as gondolas gracefully float by, suggesting that God, at least an Italian God, is in his heaven and much is right with the world.

Venice defies nature, but affirms life. She floats to a melody of her own creation that seemingly attracts visitors from every corner of the globe. If Venice is ever overcome by the sea, the world will suffer. But I cannot envision that day, for Venice exudes the spirit and energy of mankind that cannot be dethroned. *