Should the Federal Reserve be abolished as Rep. Ron Paul and others have demanded?

The Republican presidential candidates have agreed that they would like to replace Ben S. Bernanke as chairman of the Fed, and many have been equally critical of former Fed Chairman Alan Greenspan.

The view that both Mr. Bernanke and Mr. Greenspan have done poor jobs is also shared by many economists and financial writers. But, if not Mr. Bernanke, who? And if not the Fed, what?

It turns out however that the basic problem is not a central bank like the Fed, or who in particular runs it.  The basic problem is that governments have insisted upon having a monopoly in money, an idea that has been supported by most economists. The Austrian school economists, most notably the late Nobel Laureate F.A. Hayek, were skeptics of this view.

Jean Buridan (1300-1358) was a 14th century medieval French philosopher famous for his paradox known as Buridan’s Ass. If a perfectly rational ass or donkey were placed exactly equidistant between two bales of hay exactly the same, there would be no reason to choose one over the other - and given no reason to choose, the ass would be unable to do so and starve to death.

Buridan meant for his thought experiment to demonstrate the irrational barrenness of pure reason and the superiority of emotion to rationality. How medieval.

Yet it is just the position of Buridan’s Ass that the German electorate has placed itself in, exactly equidistant between the free market solutions required for their economic survival and the government subsidies to which they have become addicted.

It's a brave scientist who dares to announce the turning point of a trend, the top of a graph. A paper published this week does just that, persuasively arguing that a centuries long trend is about to reverse: the use of land for farming.

The authors write: "We are confident that we stand on the peak of cropland use, gazing at a wide expanse of land that will be spared for Nature."

Jesse Ausubel and Iddo Wernick of Rockefeller University, and Paul Waggoner of the Connecticut Agricultural Experiment Station, have reached this conclusion by documenting the gradual "dematerialization" of agriculture.

Globally, the production of a given quantity of crop requires 65% less land than it did in 1961, thanks to fertilizers, tractors, pesticides, better varieties and other factors.

Even corrected for different kinds of crops, the acreage required is falling at 2% a year.  "Peak Oil" turned out to be 180 degrees wrong.  But Peak Farmland is now very real.

The real villains in our economic crisis are those in the political class who pandered to the voter by promising more in benefits to be paid for by others.  As more and more people lose their jobs, the demand for government payments grows, making the situation worse and worse. The U.S. government is spending roughly 40 percent more than it is taking in.

The simple fact is that the amount of explicit and implicit debt that the United States and other governments have incurred cannot and will not be paid back in full. The political class will try to cure the debt mess with inflation, price controls, tax increases and confiscation, but it will only make things worse.

As more and more jobs and homes are destroyed by the debt crisis, the ranks of the revolutionaries will grow until, finally, the new "peasants" realize that the rich are gone and it is the political class who is responsible for the mess.

As Mr. Obama and many liberal Democrats embrace the Wall Street protesters, I wonder if they have not only forgotten (or ever knew) good economics, but also the lessons of history. Maximilien Robespierre, a great orator, most certainly did not intend for himself to be guillotined as he and his colleagues unleashed the Reign of Terror during the French Revolution.

Two years ago, in Afghan Poppies: What The Bush White House Should Really Be Afraid Of, I told you about CIA collusion and incompetence regarding opium production in Afghanistan.

That was in 2003. Since then, Afghanistan’s poppy crop has exploded. According to Robert Charles, in his capacity as chief counternarcotics official at the State Department, the poppy crop went from 152,000 acres in 2003 to 515,000 acres in 2004 - producing $7 billion in opium and heroin money.

This money is financing Al Qaeda, Abu Musab al Zarqawi in Iraq, and international Moslem terrorism - yet the CIA is too impossibly incompetent to stop it, and the Pentagon simply refuses to.

Many in the American Jewish community are aghast to discover that President Obama is planning to appoint former Senator Chuck Hagel to serve as Defense Secretary. If you want the skinny on how Hagel has come to be known as one of the few ferociously anti-Israel senators in the past generation, Carl from Jerusalem at Israel Matzav provides it.

Meantime, all I can say is I don't understand how anyone can possibly be surprised. Shortly after word came out that Hagel is the frontrunner for the nomination, I read a quaint little blog post written by a conservative leaning commentator voicing her belief that Obama wouldn't want to risk his relations with Israel's supporters by appointing Hagel.

But as Powerline pointed out yesterday (12/17), this is the entire point of the nomination.

Obama wants to hurt Israel. He does not like Israel. He is appointing anti-Israel advisors and cabinet members not despite their anti-Israel positions, but because of them.

Imagine what life would be like if you did not have a bank account and a credit or debit card. It would be much harder to pay your bills, take trips on airlines (which normally require a credit or debit card), and receive payments, just to start.

The shocking thing is that more than one-quarter of all American households are unbanked or underbanked and that this number is rising, not falling, largely because of ill-thought-out financial regulation and policies.

The term "unbanked" refers to people who have neither checking nor savings accounts. "Underbanked" refers to people who have either a checking or savings account but rely on alternative services such as non-bank money orders and check cashing, payday loans, pawn shops, refund anticipation loans, etc., at least once a year. These alternative sources usually are much more costly than banking services.

Banking services to lower-income people have become increasingly expensive directly because of unthinking government regulators.

OK, now that I’ve gotten the outrageousness of the Miers nomination off my chest, let me tell you a story about a wonderful guy named Howard Papush. In 1980, Howard had one of the all-time coolest jobs in Hollywood. As the “talent coordinator” for the Tonight Show, Howard was a primary gatekeeper deciding who got to be a guest and sit in that chair talking to Johnny Carson on national television.

Let me tell you how Howard reminds me of Harriet Miers.

Watching the nightmare in Syria unfold, you have to ask yourself: Could the Obama administration have made a worse hash out of the situation if it had tried?

Short of an outright Iranian victory that saw the Assad regime's power fully restored, it's hard to imagine a more dire set of circumstances for U.S. interests. The Syrian state is well on its way to imploding. A multiplicity of increasingly well-armed militias are rushing to fill the vacuum. At the forefront of the fight are a growing number of radical Islamist groups, including some affiliated with al Qaeda.

The prospect that Assad' s demise will be accompanied by the use (and/or proliferation) of chemical weapons and massive communal bloodletting gets higher by the day. Libya on steroids is what we're looking at, only this time not on the distant periphery of the Middle East but in its heartland, a gaping strategic wound that is likely to threaten the stability and wellbeing of Syria's five neighbors -- critical American partners all -- for years to come.

Does it require saying that it need not have been this way? Evidently yes.