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Rethinking the State

Mises Daily Friday: The Truth About Politics

FEBRUARY 5, 2016

The very first votes of the 2016 presidential election season were cast this week in the Iowa caucuses. This is supposed to fill us with happy thoughts about self-government, civic virtue, rational deliberation, and about politics as the way the people’s will is put into effect.

But to the contrary, we should spurn what the establishment would have us celebrate. Politics operates according to principles that would horrify us if we observed them in our private lives, and that would get us arrested if we tried to live by them. The state can steal and call it taxation, kidnap and call it conscription, kill and call it war.

And yet we are taught to fear capitalism, of all things.

But what, after all, are capitalism and the free market? They are nothing more than the sum total of voluntary exchanges in society.

When we engage in a voluntary exchange — when I buy apples for $5, or when you hire someone for $25 per hour — both sides are better off than they would have been in the absence of the exchange.

We can’t say the same for our interactions with the state, since we pay the state under threat of violence. The state sure winds up better off, though. That’s for sure.

Business firms that increase their profits thanks to some new innovation cannot rest on their laurels. Other firms will adopt the innovation themselves, and those abnormally high profits will dissipate. The original firm must continue to press forward, striving to devise still newer ways to please their fellow men.

The state operates under no such conditions. It can remain as backward as it likes. Other firms are typically prohibited from competing with it.

The state’s priorities arbitrarily override your own. Ethanol “is important for the farmers,” one candidate says. So because the state has decided some interest group’s foolish and economically nonsensical pet project is “important,” what you yourself would have preferred to do with your money is simply set aside and ignored, and you are forced to subsidize what the state seeks to privilege.

Our schools and media portray corporations as sinister, and government as benign. But who wouldn’t rather take a sales call from Norwegian Cruise Line than an audit demand from the Internal Revenue Service?

Or imagine if a corporation fabricated a web of untruths, used them as a pretext to launch a violent attack on a people that had never caused Americans any harm, and brought about as many as a million deaths and millions more internal and external refugees. That corporation would be broken up and never heard from again. It would be denounced ceaselessly until the end of time.

Now all those things did happen, but they were carried out by the state. And as we all know, there have been no repercussions for anyone. No one has been punished. In fact, the perpetrators earn six-figure speaking fees. The whole thing is shrugged off as at worst an honest mistake. Some people are still outraged about it, but even they seem to take for granted that there’s really nothing that can be done about behavior like this on the part of the American regime.

Imagine there were a corporation that was somehow so entrenched that despite being responsible for a staggering death toll, it evaded all responsibility and simply carried on as before. The outrage would be deafening and overwhelming.

But so relentless has been the propaganda, ever since all of us were children, about the state’s benign nature that many people simply cannot bring themselves to think as badly about the state as they have been taught to think about corporations — even though the crimes of the state put to shame all the misdeeds of all existing corporations put together. Meanwhile, opponents of the state are routinely portrayed as incorrigible misanthropes, when in fact, in light of the state’s true nature, we are mankind’s greatest advocates.

The market brings people together. People of divergent and sometimes antagonistic racial, religious, and philosophical backgrounds are happy to trade with one another. Beyond that, the international division of labor as it exists today is the greatest and most extraordinary example of human cooperation in the history of the world. Countless firms produce countless intermediate goods that eventually combine to become finished consumer products. And the entire structure of production, in all its complexity, is aimed at satisfying consumer preferences as effectively as possible.

The state, on the other hand, pits us against each other. If one of us wins a state favor, it comes at the expense of everyone else. For one group to be benefited, another must first be expropriated. At one time or another the state has pitted the old against the young, blacks against whites, the poor against the rich, the industrialists against agriculture, women against men.

Meanwhile, all the anti-social effort devoted to extracting favors from the state is effort that is not available to produce goods and services and increase the general prosperity.

The market is about anticipating the needs of our fellow men and exerting ourselves to meet those needs in the most cost-effective manner — in other words, by wasting the fewest possible resources, and making what we offer as affordable as we can for those we serve.

Ah, but we need the state, virtually everyone tells us. Whether it’s “monopoly,” or drugs, the bad guys overseas, or the scores of other bogeymen the state uses to justify itself, we’re constantly being reminded of why the state is supposed to be indispensable. To be sure, these and other rationales for the state sound plausible enough, which is why the state and its apologists use them. But the first halting steps toward intellectual liberation come when someone considers the possibility that the truth about these things might be different from what he hears on TV, or learned in school.

The small minority of people who administer the state with funds expropriated by the productive private sector need to justify this situation, lest the public become restless or entertain subversive ideas about the real relationship between the state and themselves. And this is where the state’s various platitudes about the people governing themselves, or taxation being voluntary, or government employees being the servants of the people, enter the picture.

Think for a moment just about this last claim: that government employees are our servants. These people staff an institution that decides how much of our income and wealth to expropriate in order to fund itself. They will imprison us if we do not pay. And we are to believe that these people are our servants?

For those not gullible enough to fall for such a transparent canard, the rationales become mildly more sophisticated. All right, all right, the state may say, it’s not quite right to say that the people govern themselves. But, they hasten to add, we can offer the next best thing: the people will be represented by individuals chosen from among them.

As Gerard Casey has argued, though, the idea of political representation is not meaningful. When an agent represents a business owner in a negotiation, he ensures that the owner’s interests are pursued. If the owner’s interests are defended only weakly, ignored, or downright defied, the owner chooses different representation.

None of this bears any resemblance to political representation. Here, a so-called representative is chosen by some people but actively opposed by others. Yet he is said to “represent” all of them. But how can this be, when he can’t possibly know them all, and even if he did, he’d discover they have mutually exclusive views and priorities?

Even if we focus entirely on those people who did vote for the representative, is their vote supposed to imply consent to his every decision? Some of them may have voted for him not for his positions or merits, but simply because he was less bad than the alternative. Others may have chosen him for one or two of his stances, but may be indifferent or hostile on everything else. How can even these people — who actually voted for the representative — seriously be said to be “represented” by him?

But the idea of political representation, while meaningless, is not without its usefulness to the modern state. It helps to conceal the brute fact that, despite all the talk about “popular rule” and “governing ourselves,” even the “free societies” of the West amount to some people ruling, and others being ruled.

When the results are announced this primary season amid cheers and celebration, then, remember what it all represents: the triumph of compulsion over cooperation, coercion over freedom, and propaganda over truth. The civics textbooks may write with breathless awe about the American political system, but this is by far the worst thing about the US. Rather than celebrate the anti-social world of politics, let us raise a glass to the anti-politics of the free market, which has yielded more wealth and prosperity through peace and cooperation than the state and its politicians could with all the coercion in the world.

Note: The views expressed on Mises.org are not necessarily those of the Mises Institute.

From Mises.org, here.

‘You Must Accept My Opinion!’

On Daas Torah

The Haredi Libertarian is a strong advocate of following Daas Torah – loosely translated, “a Torah-true opinion”.

And in much the same way as I wish to reclaim the definition of the term Haredi (as in Isaiah 66:5, ha-haredim el d’var Hashem, as opposed to a particular style of clothing fashions), I also wish to reclaim the definition of what Daas Torah is.

Daas Torah is widely believed to be the system whereby one or more askanim (community activists/politicians) go to a certain Rabbi and present him with information (sometimes complete, sometimes partial, sometimes wholly fabricated), asking him to rule on their question.  Having gotten an answer, they then plaster every vertical surface in the neighborhood with posters proclaiming that this ruling is now binding on everyone [who considers this Rabbi authoritative].  Often they short-circuit the process, and go straight to the pashkevillin without asking the Rabbi at all – and this I personally heard from the mouth of Rav Moshe Sternbuch שליט”א.  And of course, if there is an opposing opinion from another gadol, his followers will put up contrary pashkevillin.  This is exactly the kind of situation that led the Chofetz Chayim to decry the practice entirely – see the image on the left.

True Daas Torah is something completely different, and totally indispensable.  When a person is facing a dilemma – be it about halacha, schooling, lifestyle decisions, interpersonal relationships, parenting, etc. – it is essential to consult with a trusted Rabbi.  Pirkei Avos 1:6 relates Rabbi Yehoshua ben Perachya’s advice: עשה לך רב – you have to have a Rabbi you trust, to whom you can turn for guidance.  There are so many pitfalls in life, and the yetzer hara/evil inclination has many ways to blind us to them.  It is simply the responsible thing to do, to have a trusted external party, who is not only wise in the ways of the world, but also a reliable source for halacha, who can give us the objective advice we need, free of the internal personal inclinations that cloud our judgment.

Even so, Daas Torah can only take you so far, and no further.  Ultimately, after 120 years, we are going to have to stand before the King of Kings, and we will have to justify ourselves before Him.  And nobody else will be standing there for us to blame, not even the Rabbi we consulted.  Rabbis are human beings, too, and sometimes even they make mistakes.  If we could not have known better, and we relied on a faulty ruling that we accepted in good conscience, then fine, אונס רחמנא פטריה – it is considered an accident that is no fault of ours.  But sometimes we do know better.  I know this, because it has happened to me.

I was once in a very difficult situation, involving a vexing moral decision.  My Rabbi at the time advised me to follow a certain course of action, which he strongly believed was the  halachically correct and good thing to do – and yet I could not bring myself to do it.  Something inside me was screaming that this was wrong.  I therefore consulted with Rav L. (pending his approval to mention his name) – secondary Daas Torah, if you will – with whom I had a past connection.  His advice to me was this: When Hashem put us in this world, He not only gave us His Torah to guide us; He also gave us a spiritual DNA.  Our souls have a direct connection to God, and when faced with an immoral course of action, a healthy neshama will rebel with all its strength against doing wrong.  If your neshama is screaming at you, then that’s a warning sign you cannot ignore.

I took the score as 2-1, with Rav L. and my neshama outvoting my Rav, and I did what the latter had told me not to do.  I have not done such a thing before or since, and I have no regrets.

In that same conversation with Rav L., we discussed the concept of Daas Torah – the kind we mentioned before, where somebody comes and says, “Rav X says such-and-such, therefore it’s Daas Torah and you have to obey!”  Rav L said to me: “When someone comes at you brandishing the phrases ‘Daas Torah’ or ‘The Gedolim Say’, run a mile!  Daas Torah is a conversation stopper used by insecure people to squash debate.”

Hashem not only created us with a neshama with a spiritual safety valve, but He also gave us an intellect through which we can apply logic and reason, and guess what – He expects us to use them!  If someone can convince you of the validity of his position through clear and rational debate, then that is a good thing.  Expecting people to stifle their rational thought processes, just because “The Gedolim Say” is not Torah; it is a perversion of Torah.  Look through the Gemara, which is chock full of fiery debates – and see if a single debate was settled by Rava saying to Abaye, “Rabbah says so, therefore you must concede!”  For sure, the amoraim do not ever challenge the opinions of the tannaim – but nobody ever says that one tanna is the authoritative tanna, and you have to listen to him rather than any other tanna.  All debate in the gemara is based on reason – and I see no reason why that should apply any less today.

In summary: Daas Torah is a personal thing, for each individual to consult sincerely with their chosen Rebbe.  Nobody has the right to impose Daas Torah on anyone else, because every individual has the sacred duty to use both their neshama and their brain in the service of Hashem.

This, then, is the backdrop against which I will be expressing the opinions of the Haredi Libertarian, which often will appear to be at odds with conventional Haredi positions; I do not see any intrinsic paradox in this.  I will always welcome sincere and respectful debate, and I hope you will continue on this journey with me!

Preserving the Torah of the German Rishonim

Vision

Machon Moreshes Ashkenaz – The Institute for Ashkenazi Heritage – is the leading institute dedicated to the research, preservation and transmission of the unique religious values, customs, and folklore of German Jewry, as they existed prior to the Holocaust.

Background

The history of German (Ashkenazi) Jewry dates back to the destruction of the holy Temple in Jerusalem. First in Roman Italy, later on in the Rhine Valley, these Jews developed their own remarkable tradition. That tradition is the cumulative product of two millennia of brilliant scholars and dedicated community leaders. It remains today one of the priceless spiritual legacies of our people.
Rabbi Isaac of Vienna the ‘Ohr Zarua’ exclaimed nearly eight hundred years ago, “Do you not know what towering geniuses and men of holiness are the Rabbis of Mainz, Worms, and Speier? From them has the Torah gone forth to all of Israel!” After Rabbenu Asher (the ‘Rosh’) was forced to flee Germany for Spain, he wrote, “I keep to our tradition as we received it from our ancestors of blessed memory, the Sages of Ashkenaz. Their Torah was a legacy from their fathers from the time of the Temple’s destruction.”
In later times, we find leading Western and Eastern European Sages looking to the Masores Ashkenaz, as maintained by German Jewry, as the authentic Ashkenazi tradition. The ‘Chavas Ya’ir’, Rabbi Ya’ir Chaim Bacharach of Worms (1638-1702) described the Minhagim of Ashkenaz as free of the distortions and corruptions which inadvertently crept into other traditions. The ‘Korban Nasanel’, Rabbi Nasanel Weil of Karlsruhe (1687-1769), expressed the view that the customs of Germany were built on foundations of solid gold far superior to the customs of Eastern Europe. In one of his responsa, he writes, “All the customs of Germany still apply in full force, for the great rabbis of Ashkenaz, who laid down the Torah for Israel, established all our accepted customs, which we, as the descendants of the Ashkenazim, should follow.”
Rabbi Yonasan Eibeschuetz (1690-1767), though born and raised in Eastern Europe, concurred: “The Torah was given over to the Sages of Ashkenaz. What could we know of which they were not aware?” The ‘Chasam Sofer’, Rabbi Moses Schreiber of Pressburg (1762-1839) a native of Frankfurt and subsequently the leader of Hungarian Jewry, wrote, “all the customs of Germany were established by our teachers, the disciples of Rashi…”
The Jewish communities of Germany were the source of spiritual life for generation after generation of European Jewry. The communities of Germany flourished for centuries, enriching the Jewish world, nourishing the precious heritage of Sinai, and willingly giving their lives to sanctify Hashem’s Name.

The Setting Sun

From the time of the First Crusade, the Jews of Germany were continuously persecuted, humiliated, and murdered by their Gentile neighbors. As a consequence, there was a constant emigration of Jews from Germany to Eastern Europe. These refugees constituted a large percentage of Eastern European Jewry. It was they who provided Eastern European Jewry with its distinctive language Juedisch-Deutsch (Yiddish) and ethnic appellation – Ashkenazim. Unfortunately, the traditions of Germany did not always fully survive the move to Eastern Europe.
The constant emigration from Germany throughout the centuries thinned the ranks of the remaining communities. By the 1930s there were only five hundred thousand Jews living in Germany, compared to three and a half million living in Poland alone.
Yet, their relatively small numbers did not prevent the German Jews in the 17th and 18th centuries from nurturing a flourishing Torah life and maintaining Yeshivos in many communities. The famous Yeshivos of Germany attracted young scholars from all over Europe, and did so until the tides of the Enlightenment swept all away.
The influence of the Enlightenment was first felt by the Jews of Western Europe. With political emancipation and the opening of the ghettos, the Jews of Western Europe were exposed for the first time to a non-Jewish culture not without its own allure. Assimilation was the result.
With the mushrooming of Western European culture, Germany and France became the world centers of the Enlightenment. Philosophers, composers, poets, and scientists abounded, and with them grew the universities. Freed from the ghettos, granted civil rights at last, and suddenly confronted with a dazzling Gentile world, the Jews of the west reeled in shock. Many succumbed, whether all at once or gradually, and took the course of assimilation.
In Eastern Europe the dangers of Gentile culture were still scarcely noticeable. The ambient Gentile culture was simply too primitive as to be worth assimilating into. It was only much later that the Enlightenment and the Socialist movements penetrated there.
Though traditional German Jewry did consolidate and strengthen itself against assimilation, it was now to the Yeshivos of Eastern Europe that German Jewish boys went to seek advanced Torah learning. In fact, between the two world wars the German Yeshivos began to flower again, but soon afterwards the Holocaust wiped them out entirely. Even in those final generations however Germany Torah Jewry was characterized by heroes of the spirit who guarded their ancestral heritage zealously and with joy.
In the Holocaust a third of German Jews were slaughtered. While two-thirds of German Jewry escaped with their lives, the communities nurtured over millennia were destroyed. their dispersion throughout many other countries resulted in their becoming a small minority in their new homes. This minority status fostered the rapid disappearance of the specific German-Jewish identity, way of life and customs.
A few communities reestablished themselves on foreign soil after the War, foremost among them K’hal Adath Jeshurun in Washington Heights, N. Y. In these communities the traditions of German Jewry were lovingly preserved. However, the younger generation, by and large, have not maintained their parents’ traditions, mostly due to a lack of appreciation of the spiritual basis which formed Minhag Ashkenaz. Only a very small percentage of the second and third-generation is particularly knowledgeable about the cultural/religious heritage of Ashkenaz.
With the destruction caused by the Holocaust, all of the above came to an abrupt halt. As in all acts of cultural genocide, it has taken years to even realize how much has been lost. Given the aging of the survivors of that period, there is a narrow window remaining to collect material that was part of a daily consciousness for many, until 1938 in Germany.

Machon Moreshes Ashkenaz

German Jews established communities throughout the world, in the years immediately following the destruction of European Jewry. Most of these communities were not successful in maintaining their unique identity for longer than two generations and have not been able to secure their continuation. The younger generation has been drawn to other communities, mainly due to the lack of appreciation for, and knowledge of, the rich spiritual and cultural heritage of their ancestors.
Machon Moreshes Ashkenaz will enable the present generation to familiarize itself with this heritage and appreciate it, and to return to practice this heritage, if they are inclined to do so.
If anything is to be passed on to coming generations the people must be inspired to follow their heritage. They must be made aware of its solid halachic foundations and encouraged to maintain its practice. Furthermore, the manuscripts of German Jewry’s great Torah scholars need to be preserved and printed, along with their major works of Jewish thought. German Jewry’s prayer melodies must be collected and released to the public. Biographies of Germany’s leading Torah figures need to be written, and its customs must be gathered and annotated.
The many and varied projects of the Institute serve one sole purpose – researching and revitalizing the spiritual treasures of German Jewry which have been neglected for many years.
The Institute for German Jewish Heritage is active in researching, preserving, and transmitting to the new generations the unique religious lifestyle, customs, and folklore of German Jewry as existed until its destruction during the Holocaust. This activity includes publishing leaflets, pamphlets, and books, and running this Internet site.
Machon Moreshes Ashkenaz (The Institute for German Jewish Heritage) was founded over fifteen years ago expressly for these purposes
The Institute’s activities center around religious traditions that were fostered in Germany, and in the communities of France, Switzerland, France, Denmark and Holland that were under the influence of the common tradition developed in Germany during the Middle Ages.
By collecting, organizing and publishing materials about the totality of the German-Jewish life experience prior to World War II, we hope to accomplish two things. We wish to be able to provide material about a vibrant way of life so that those interested in reaffirming their heritage in their own lives can do so. Additionally, we wish to act as a resource for academics working in the areas of Jewish cultural history, liturgy, and Responsa literature.

A Comprehensive Ashkenaz Library

Information is the fundamental requirement for researching our Ashkenazi heritage. The material gathered on large Card indexes by Machon Moreshes Ashkenaz has already proven a rich treasure of information for Torah scholars, researchers, and ordinary Jews interested in the customs of German Jewry.
The Institute’s archives contain thousands of documents related to the recent and past history of German Jewry. Our library already holds some ten thousand books and is growing.

Archives
The Machon’s archives contain thousands of documents related to the past history of German Jewry, both present and past. These documents will be catalogued so that they can be more easily accessed for research purposes.

From Moreshet Ashkenaz, here.

Learning the Lesson of Purim

Op-Ed: Understanding the Agagite ‘Other’

There is a fundamental misunderstanding about the holiday of Purim. It is generally believed that the date for Purim is based on the celebration of the Jews of their rescue from the nefarious plans of Haman. That is not quite correct. The plans of Haman to destroy the Jews of the realm of Xerxes were actually undone by Mordecai, Esther and the King nearly a year earlier, in the month of Sivan (late May), long before the date of Purim, which is the 14th (and 15th) of Adar. The timing of the holiday is also not exactly a reflection of the date on which Haman and his tanzim were plotting to annihilate the Jews, thus it is not simply a celebration of the plot being prevented. That plot was for the 13th day of Adar, but Purim is celebrated afterwards, on a different date.

So if the timing of Purim is not to denote the date when the threat to the Jews was removed and if it is not timed to be simply a celebration of that rescue, then what does explain the timing and the essence of Purim?

The answer is quite simple: Purim is the celebration of the killing of anti-Semites. This is quite explicit in the Scroll of Esther. The Jews had been safe from Haman for nearly 10 months, but then, on the 13th day of Adar, they killed over 75,000 anti-Semites. Moreover, they killed them in a well-planned manner, without taking any loot or booty, lest they be accused of acting out of lust for the spoils of the anti-Semites, rather than killing the anti-Semites for its own sake.

Indeed, the entire season around Purim emphasizes the important place in the holiday for the killing of anti-Semites. On the Sabbath before Purim, a special section of the Torah is read in which Jews are reminded of their obligations for all eternity to track down and exterminate the anti-Semites of Amalek. Moreover, the special role for celebrating the killing of anti-Semites in Purim goes further. There is a Rabbinic tradition, that goes back at least to Maimonides, that holds that when the Messiah comes, all Jewish religious holidays other than Purim will be cancelled. Purim will still be celebrated in the Messianic Era. There will be no need to celebrate rescue in a Messianic era where there are no threats to Jews, but therewill be a need to recall the role of killing anti-Semites in human history, even when Succot and Passover have been melted into the general Messianic bliss.

Both Purim and the annual ceremony in which Jews are reminded that they must annihilate Amalek are designed to teach something about the nature of anti-Semitism. The fundamental lesson is that there are never any “underlying causes” for anti-Semitism and Jews must not seek them. Amalek represents base hatred of Jews, without any cause. The Amelekites did not attack the Jews in the desert because the Jews occupied their lands or exploited their resources or mistreated them or behaved in an insensitive manner towards them or created an unfair wealth distribution among them. They attacked the Jews for no reason. Anti-Semitism never has underlying causes. The anti-Semitism of the Haman plot is just as devoid of underlying causes, although the Scroll does mention Haman’s resentment at being snubbed by Mordecai. Haman is himself an Amalekite, descended from the King of the Amalekites who was foolishly spared by King Saul in an act of misplaced compassion. The hero of that earlier story is Samuel, who slits the throat of Agag, King of the Amalekites, without hesitation and without mercy. For his misplaced PC compassion, Saul is stripped of his dynasty. The hatred of the Jews in the kingdom of Xerxes was without real “underlying cause”, just as all anti-Semitism is Amalekite in nature.

The 14th (and 15th) day of Adar, the date for the celebration of Purim, is the day on which the Jews relaxed after killing the more than 75,000 anti-Semites of the Kingdom. It is the day on which they sat back, took in, contemplated and savored, much like the Almighty did Himself on the day after completing the six days of Creation.

To put this differently: The Jews did not offer to pay survivor pensions to the ten sons of Haman after Haman was hanged; the Jews did not whine about how killing those ten was unfair collective punishment of the innocent family of the guilty terrorist; the Jews did not allow Haman’s wife to keep her house; the Jews did not bleat about the horror of collectively punishing the 75,000 anti-Semites; Amnesty International and the EU were not invited in; international observers were not allowed to oversee the treatment of the anti-Semites by the Jews; CNN and BBC reporters were not allowed in to report stories about “what the Jews claim was Haman’s terrorism”; the Chief Justice of the Supreme Sanhedrin did not order that potential killers of Shushan Jewish children be put back on the streets; the Jewish media did not wring its hands over the sufferings of the Persians and Medes under Israelite occupation; Vashti was not invited to run for the parliament at the head of a lesbian party; Mordecai was not arrested for incitement; people did not spit at Mordecai and Esther as they walked down the street in religious garb and call them ?Dirty dosim; the press was not filled with reports about how Haman had been really trying his best to halt the violence; Jewish leaders did not explain how there was no military solution to the problem of Haman and his tanzim; the Jewish press did not insist that Haman was the only peace partner we have and so he must be cultivated, lest some really radical anti-Semite become the Minister for the King, nor did it insist that the Jews show understanding and sensitivity towards the Agagite ?Other?.
———————————
Dr. Steven Plaut teaches at the Graduate School of Business, University of Haifa, Israel.

From Arutz Sheva, here.

Global Recession Draws Nigh

Jim Rogers Says 100% Probability US Is Heading for Recession; Data Backs Him Up

By Samuel Bryan
SchiffGold.com

March 9, 2016

Media and government officials keep telling us the economy looks great, but a peek behind the curtain tells a different story.

Some people do see the writing on the wall. Peter Schiff has been saying the US may well have already entered a recession. Last month, Jim Grant echoed Peter, saying the US economy likely went into recession in December 2015. And in a recent interview, Rogers Holdings Chairman Jim Rogers said there is a 100% probability the US will be in a downturn within a year:

It’s been seven years, eight years since we had the last recession in the US, and normally, historically we have them every four to seven years for whatever reason—at least we always have. It doesn’t have to happen in four to seven years, but look at the debt, the debt is staggering.”

The debt is indeed staggering, and that’s not the only sign of trouble on the horizon. But by and large, the mainstream just doesn’t get it. Last week, the government revised GDP growth up to 1.0% for the fourth quarter of 2015. It was at 2.0% in Q3. That led to extensive cheerleading.

But once again, mainstream analysts put on rose-colored glasses and it’s blinded them to reality. Digging just beneath the surface, we find a lot of reasons to be less optimistic about future economic prospects.

As economist Bob Murphy pointed out, the GDP numbers aren’t good at all when you put them in context:

Yes, this new estimate of 1.0% real growth in 4q 2015 is better than the original estimate of 0.7% growth, but it is still half of the 3rd quarter growth. For those who rely on these numbers, why are we supposed to be happy that the annualized growth rate fell in half from 3rd to 4th quarter 2015?…Even according to the White House’s own chart (posted above), we can see that the recent announcement is hardly grounds for breaking out the champagne. In the chart above, we added everything in red. Look at how the quarterly 2015 growth figures compare to 2007. Why is all of this good news?”

Then we had this week’s “better than expected” job numbers. Employers added more workers than anticipated last month.

More cheerleading.

In fact, analysts in several mainstream publications suggested all of this good economic news may well put Federal Reserve rate hikes back on the table. But again, they ignore important underlying data. While the number of jobs rose, wages unexpectedly declined, “dashing hopes that reduced slack in the labor market was starting to benefit all Americans.” Bloomberg went on to point out, “Average hourly earnings dropped, the first monthly decline in more than a year, and workers put in fewer hours.” That means lower productivity.

In related employment news, a headline at CNBC proclaimed “US Layoffs Ease in Feb, Totaling 61,599.” But again, a little context takes the shine right off the headline. All you have to do is read three paragraphs into the story before you hit that uh-oh moment:

Despite the month-to-month fall, downsizing in February was 22% higher than in February 2015. In the January-February period, announced layoffs were 32% higher than during the first two months of 2015.”

This leads us to other troubling signs that the media brushed off while cheerleading jobs and GDP. The US trade deficit expanded to $45.7 billion in January. Exports fell for the fourth straight month. And US factory orders tumbled for the 15th straight month. As ZeroHedge pointed out, in 60 years, the US economy has not suffered a 15-month continuous year-on-year drop in factory orders without being in recession.

Finally, we have what Business Insider called “the clearest sign yet that something is wrong with the US economy:”

Markit Economics’ monthly flash services purchasing manager’s index, a preliminary reading on the sector, fell into contraction for the first time in over two years. The tentative February index was reported Wednesday at 49.8. That’s below 50, the border between expansion and contraction.”

The media and government spokespeople can keep spinning it all they want, but raw data doesn’t lie.

So, what should you do? Jim Rogers said he’s long the US dollar, even while calling it a potential bubble in the making. Bubbles pop. But historically, gold and silver provide a safe haven during times of economic trouble. In fact, that’s exactly why gold continues to climb in what many are now calling a bull market. Investors don’t seem to be buying the economic sales pitch. But they are buying gold and silver.

Reprinted from SchiffGold.com.

From Lewrockwell.com, here.