The opt-out movement isn’t confined to New York. New Jersey, Colorado, and California now have growing opt-out movements,20 with more expected to follow. Richard Brodsky of the liberal think tank Demos called the opt-out movement “a citizen revolt.”21 For once, I agree with him. That’s just what it is.
I don’t mean to imply that millions of progressives have suddenly seen the light and become conservatives. Different groups of people oppose Common Core for different reasons. Teachers unions, like all unions, don’t want their members accountable to anyone, in any way.
Liberal parents who oppose any kind of grading and want everyone in sports competitions to receive a trophy oppose Common Core testing because it’s just too stressful and may bruise the self-esteem of their precious little snowflakes.
Whatever their reasons, it’s apparent that opposition to Common Core is not an exclusively Republican or conservative position. Conservatives and liberals are instinctively resisting it. Yet the federal government continues to shove it down our throats. That’s Government Zero. The government doesn’t represent conservatives. It doesn’t even represent the progressives who elected it. It represents itself and pursues its agenda regardless of the will of the people.
The Biggest Bubble Yet?
I’ve been talking about the higher education bubble for some time now. It has continued to grow since my last book and may be nearing a breaking point. Earlier this year, the Federal Reserve reported that only “37 percent of borrowers are current on their loans and are actively paying them down, and 17 percent are in default or in delinquency.”22 That means a staggering 63 percent of student loan borrowers are behind on payments or in default.
Just to put things in perspective, the average default rate expected in most commercial markets is a little over 1 percent. According to Investopedia, “As of January 2015, the default rate for a broad swath of the credit services industry including first and second mortgages, auto loans and bank cards was 1.12%. For every $100 that was lent, $1.12 was defaulted on, or not paid back.”23
If the federal government weren’t guaranteeing the loans, which forces you to pay them back when the students default, this bubble would have exploded long ago. But that can go on for only so long. Remember, government-backed loans by Fannie Mae and Freddie Mac played the same role in the housing meltdown.
In reality, the education bubble is identical to the housing and dot-com bubbles. It has all the same symptoms resulting from all the same government interventions.
First and foremost, we have a central bank that has inflated the currency beyond any historical precedent. This is the only reason there are enough U.S. dollars in existence to lend to every single high school graduate who wants one.
When money is scarce, lenders give loans only to the most creditworthy individuals. When there is a virtually infinite supply of money, lenders will eventually make loans to all comers, regardless of creditworthiness, especially when they have nothing to lose if the borrower defaults.
So, just as in the dot-com and housing bubbles, the first culprit in this bubble is the Federal Reserve. If they hadn’t created an unlimited supply of money, the rest of the problem would be academic.
Of course, it doesn’t end there. Disasters like the housing meltdown require a symphony of bad policy, and we have a true maestro in that regard occupying the White House.
The next movement in the symphony is the guarantee itself. This is the same “moral hazard” everyone talked about with the “Greenspan put” in the 1990s and the Fannie and Freddie guarantees in the 2000s. It doesn’t take a rocket scientist to figure out that when the government says it will pay back any loans that default, more are going to default.
The truly immoral part of this equation is their making you pay for this. Why should taxpayers be financially responsible to pay back money borrowed by people they don’t even know and whose decisions they have no control over? What possible justification is there for this, other than the usual socialist mantras?
The combination of unlimited, cheap supplies of money and the moral hazard of government-backed loans is having the same effect on the education sector of the economy as it had on the housing sector. It’s hard to believe so few seem to see it.
College tuitions continue to outpace inflation, just as housing prices did. This isn’t hard to understand. Guaranteeing loans to everyone artificially increases demand. Remember, demand isn’t just the desire to purchase; it’s also the ability to purchase. When the government guarantees loans to everyone with your money, demand explodes and prices with it.
The bubble also misallocates resources. Do you remember all those people in the house-building business who lost their jobs in 2008? They shouldn’t have been working in the house-building business to begin with. There wasn’t enough real demand to support all those employees in that sector.
So, why didn’t they just get jobs in another industry when the bubble popped? Because the jobs weren’t there. The capital that would have created them had all flowed to housing, where profits were guaranteed while the bubble lasted. Do you see how the harmful effects of government intervention multiply geometrically?
When the education bubble pops, the same thing is going to happen to millions of people employed in the education sector. They’re going to be out of work with no prospects and no skills to bring to a new job. They’ll just join the record number of Americans receiving government welfare benefits, thanks to the Food Stamp President.
It couldn’t work out better for the progressives bent on destroying the American economy and overwhelming the system, just as Cloward and Piven suggested. If you aren’t familiar with them, I’ll talk more about them in a later chapter.
Employees aren’t the only resources misallocated by the bubble. It also artificially inflates the number of people who choose to go to college in the first place.
I’m going to say something that I’m sure will send liberals into apoplectic shock. Everyone should not go to college. That’s right, you read that correctly. I’m sure somehow that will be interpreted as racist, sexist, or at least heartless. But it’s not racist. It’s not sexist. It’s not heartless and it’s not fattening. It’s the truth.
We didn’t always assume that everyone, or even most people, should go to college. College used to be a place you went if you were planning on a career in medicine, law, engineering, or other specialized professions. People planning on other lines of work didn’t waste the money to go to college because their money and time was more wisely invested in apprenticeships and other, practical work experience.
The idea that people have to go to college in order to be successful is a new one. It’s also complete baloney. Bill Gates, Steve Jobs, Larry Ellison, and John Paul DeJoria are just a few contemporary billionaires who didn’t get a college degree. Mark Zuckerberg doesn’t have one. Even our leftist propagandist David Geffen doesn’t have one.
This is nothing new. A large percentage of the most successful people in American history did not earn college degrees, from Benjamin Franklin and Abraham Lincoln to Henry Ford to Wendy’s Dave Thomas. Neither Frederick Henry Royce, cofounder of Rolls-Royce, nor George Eastman, founder of Kodak, had college degrees. There are hundreds more examples.
That doesn’t mean you have to be a history-making entrepreneur to be successful without a college degree, either. I know dozens of small business people making six-figure incomes doing electrical work, landscaping, plumbing, and even janitorial work. Many of these businesses are starving for quality employees while college graduates with useless degrees are working fast-food jobs or living in their parents’ basements.
Don’t get me wrong: I’m not saying every single individual in this country should not have an equal opportunity to attend college if he or she wants to. What I am saying is that each individual should have to take responsibility for that decision. Similarly, banks who make huge profits on student loans should also take responsibility for the money they lend. Taxpayers shouldn’
t be bailing out students or banks.
If that were the case, students would have to make prudent choices on whether or not to go to college and, more important, what they are going to learn there. Banks would have to consider the chances the student has of paying back the loan out of the money he or she will earn after graduation.
That is exactly the opposite of what is happening in our bubble education economy right now. According to the federal government’s National Center for Education Statistics, the top five majors in terms of degrees earned in 2010–2011 were business, social sciences and history, health professions and related programs, education, and psychology.24
Three out of these five majors rank in the bottom twenty in terms of earning potential for graduates.25 That means most students entering college right now are choosing the majors least likely to help them earn enough money to pay back their student loans. Those entering education in particular are setting themselves up to be sitting at ground zero when the education bubble explodes. It’s tragic.
So, what does Obama suggest we do in the face of this problem that has been building up for generations? Make it worse. His “Pay As You Earn” (PAYE) program just encourages more of everything that caused the problem. There is no incentive against taking out tens or hundreds of thousands in student loans to subsidize a low-paying major when you will be required to pay only 10 percent of your income in payments, regardless of how low your income may be.
Don’t get me wrong. I’m not blaming all of this on Obama. That idiot George W. Bush did exactly the same thing while the Federal Reserve blew up a housing bubble on his watch. He cheered on his “ownership society” while the bubble got bigger and bigger. He further nationalized education with No Child Left Behind, doubling the size of the Department of Education Republicans used to vow to abolish.
That doesn’t make Obama’s policies any better. Just as in every other area, he’s doubled down on the mistakes of the past while managing to make new ones no other president would have dreamed of.
Sooner or later, the education party is going to end, just as housing did. The banks don’t have to worry. The Dodd-Frank act has made them even more “too big to fail” than they were in 2008.
The losers will be the rest of us: unemployed college graduates with useless degrees in art or women’s studies, small businesses that can’t expand for lack of skilled workers, and society in general suffering the effects of a dumbed-down, brainwashed, unskilled, and unemployable population that is increasingly dependent on the government handouts that help the progressives keep winning elections.
Our Most Important Fight
You can begin to see why American students do so poorly compared to students in countries that spend less on education. It’s also why the Democratic Party wins elections. The two phenomena are related.
The school system spends most of its time teaching kids things that aren’t true and almost no time teaching them things that are. They learn a completely false version of history and junk science like global warming, while their competitors in other countries are developing advanced skills.
Meanwhile, American students can’t read, write, or speak their own language properly. They’re taught math in a way that even parents with graduate degrees in math can’t understand. Common Core discourages reading the classics and encourages reading reports generated by the Federal Reserve. Do you think they’ll be able to recognize history repeating itself reading government reports instead of the classics? Not likely.
American students are constantly brainwashed with the idea that Muslims are viciously persecuted in America, regardless of the evidence of a growing, active jihadist population in our midst. They are taught to believe the mere mention of God or Jesus on public property is discriminatory, while the murder, rape, and torture of Christians by radical Islamists is rationalized away.
Overall, the school system produces the prototypical Democratic voter. He or she is completely ignorant of real history, incompetent in critical thinking, unable to understand or express complex ideas, and unprepared to learn the specialized skills that make him or her competitive in the twenty-first-century marketplace. This student graduates with a learned suspicion of entrepreneurs and no suspicion of government.
They learn abortion is a right but private property is not. They are encouraged to have sex but are discouraged from entering the workforce, even if college isn’t the best thing for them at that point in their lives. They emerge from high school feeling guilty about who they are if they are white or male, and aggrieved and victimized if they are female or a minority. They become low-information voters, even if they go on to get college degrees.
Meanwhile, the economic policies that have created and continue to expand the education bubble continue to steer students toward useless majors dominated by leftist professors who teach students no marketable skills but imbue them with Progressive-Islamist brainwashing.
Education may be the most important fight we have. Unless we can change these trends, there won’t be enough clear-thinking, self-sufficient, patriotic Americans left to defeat the dark forces trying to destroy our civilization. I’ll tell you what I believe we have to do at the end of this book.
CHAPTER 6
Zero Culture
First World to Third World
America’s culture has gone from First World to Third World status. It’s swimming in a mire of sex, drugs, base entertainment, class envy, entitlement, and apathy. Welcome to the new Progressive-Islamist America.
Today, the average American high school senior has lived his whole life being told that businessmen are evil, minorities are viciously persecuted in America, Islam is the religion of peace, and Christianity and Judaism are the religions of white privilege, ignorance, and intolerance. He is taught to loathe himself if he is white and male or to consider him- or herself persecuted if a minority or female, whether it’s true or not.
Kids haven’t just learned this in school. It’s reaffirmed in films, on television, in the music they listen to, and by the so-called news media. From the moment children begin perceiving the world around them, they are inundated with progressivism. I doubt most parents realize it. They’ve been fully indoctrinated themselves.
I’m not blaming this all on Obama or even government in general. Certainly, poor leadership plays a part, but there is a cause-and-effect dimension to the decline of our culture. A corrupt government contributes to the corruption of the people, but the opposite is also true. You don’t get the policy makers we have now unless the people themselves are already corrupted. It’s very much a vicious circle.
Remember, politicians, entertainers, and media peddle envy politics, trashy entertainment, junk science, and substandard journalism only because there is demand for it. Some of the blame for Government Zero rests squarely on the people’s shoulders.
Hollywood’s War on American Culture
As I tell my listeners on The Savage Nation, follow the money. Late last year, Gov. Jerry Brown signed a bill tripling the tax break incentives for Hollywood.1 As with all crony capitalism, the cover story is this will keep jobs from moving out of state or overseas.
In reality, it’s just another arm of the government-media complex that is waging all-out war on American culture. Multimillionaire film moguls like Harvey Weinstein and Jeffrey Katzenberg get even richer. In return, they make movies that promote a message the progressives in the state and federal governments approve of. And what the progressives in government approve of are anticapitalist, antireligion, antimilitary, or, in short, anti-American films.
When the film American Sniper attracted the biggest box office in decades and threatened to bring the people together in their love of country and the military, the harlots of Hollywood’s left with their fellow travelers in the media began a campaign of hatred against the film and its hero. It was hatred and vitriol they don’t express toward the Islamic barbarians who are raping, beheading, and conquering the Middle East as the Nazis did in Europe.
Muslim students at the University of Michigan were successful in getting the college to cancel a screening of the film by “claiming the film promote[d] anti-Muslim rhetoric and made them feel unsafe.”2 The college announced its plans to stimulate the students’ intellects with Paddington, a movie based on the stuffed animal, instead.
Following news reporting of the decision, the university faced outrage on a national scale and eventually reversed its decision. But these are the kinds of tactics used to attack American culture and patriotism every day on campuses and elsewhere. As usual, Muslims teamed up with progressives to silence any voice not uttering the Progressive-Islamist narrative.
For those who actually watched the movie, it doesn’t glorify war. I’m an antiwar conservative and believe war is the worst thing that can happen to any society. It should be avoided at all costs and always be a last resort. But when civilization itself is under attack by barbarians who set people on fire while they are still alive, it has to be defended by somebody.
The movie depicts war as it actually is. The whole reason soldiers are heroic is they do a job nobody wants to do but which has to be done. They do it at great personal risk to defend civilization. Some of them make the ultimate sacrifice so that we can go on writing books and making movies and enjoying the blessings of liberty.
Clint Eastwood made a film celebrating these heroes and portraying those who fight for civilization positively, and people flocked to the theaters to see it. The left could not let this verdict stand.
Just like the red guards had done in Mao’s China during the so-called Cultural Revolution, America’s red brigades worked tirelessly to demoralize and defeat their natural enemy: the most productive, patriotic citizens of America, who were naturally drawn toward a film that affirmed their values.
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