Glenn Beck: Keepers of the flame



Congressman Michele Bachmann

GLENN: I want to introduce you to somebody I just met the other day, Congressman Michele Bachmann. She is from Minnesota. And normally -- I believe I just said within the last two weeks that we should secede from Minnesota, but that's only because of Jesse Ventura and Al Franken. What are people thinking?

CONGRESSWOMAN BACHMANN: Hey, it's not over yet. We have this in court right now, and Norm Coleman may yet pull this out. If we get a judge who will lawfully apply the Constitution, equal protection under the law, then we will see Norm Coleman prevail.

GLENN: You know, here's the thing, congresswoman. We have got to change the system to where if you're too stupid to vote, we don't have a court try to figure out -- or individuals try to figure out what you voted for. If you're too stupid to fill in a little bubble, you've disenfranchised yourself. You're too stupid to vote.

CONGRESSWOMAN BACHMANN: Well, we have a situation in Minnesota where we had votes counted, Glenn, that were date stamped November 2nd. We had votes where they were run through a machine twice they were counted. 28 precincts there were more votes than voters. We have some real irregularities. We had votes that were counted on election night if they favored Al Franken, votes counted with the recount if they favored Al Franken. So it was flip a coin: Heads, Al Franken wins, tails, Norm Coleman loses. So if we get actual equal protection under the law, then we'll be fine. We just need to have the law applied equally and fairly in all the counties and then we'll get a just result.

GLENN: Congresswoman, you said to me that there are a few of you in Washington, in congress, that are like minded, that are just fighting the fight to keep the flame alive.

CONGRESSWOMAN BACHMANN: There are. There are. I would say there are probably 30 keepers of the flame over here, and I fully believe you don't need to even have a majority but you need to have a critical mass. I don't know if we're quite a critical mass, but if you have enough like minded people, the main thing we can do right now is be foreign correspondents reporting to you from enemy lines. That's really what we're doing right now because I think the American people would have their breath taken away if they saw the amount of freedom and money that will be taken away from them in the next few months, and they need to pay attention to you, they need to tune in to your new television show on Fox because they are going to hear it in too many venues what is actually happening here in D.C. and that's what I want to partner with you today, let you know the reality of what's happening here.

GLENN: Let me ask you this real quick question, then I want to get to some of the realities of what's happening. Please tell me that there are some common sense Democrats that are part of that 30 or 40.

CONGRESSWOMAN BACHMANN: Well, I hope so. There are new Democrats here that I haven't met yet and I will be quite blunt with you. I'm not trying to be partisan. There are very, very few Democrats who are gutsy enough to not vote with Nancy Pelosi. This woman rules with a titanium fist, a very tight ship, and she just threatened the, quote, conservative Democrats that if they don't vote for this stimulus plan that she will take away from them their one-week recess that they have to be back in their district in February. So it's kind of like --

GLENN: It's like second grade.

CONGRESSWOMAN BACHMANN: It is like second grade. It's like the teacher says, "Students, class, you won't be going out for recess if you don't do what I'm telling you to do." That's exactly what she announced last week and so --

GLENN: All right. Hang on -- okay. Hang on just a second. So America, what you should hear from this is if you voted for a conservative Democrat and your person won and got in, you must get on the phone and shore them up.

CONGRESSWOMAN BACHMANN: Without a doubt, yeah.

GLENN: Please.

CONGRESSWOMAN BACHMANN: Yeah.

GLENN: Please, you don't have to come home. We understand you stay in touch with us through radio or television or Internet or whatever, just stay in touch with us. You don't have to come home. Stay there. Do the right thing. Do the hard thing. Buck the system. That's what we sent you to do.

CONGRESSWOMAN BACHMANN: We need to send a big negatory on this next so-called stimulus plan. It's not stimulus. It will actually kill our economy because again, remember your listeners need to know, Glenn, we don't have this money. We didn't have the last $700 billion that we sent out the door. We had to go and borrow that from countries that don't like us very much. It's just like if you take a loan out to buy a house, a loan for let's say $100,000. You don't pay back $100,000 to the bank. You pay over $200,000 back by the time you pay interest. It's the same thing. And with the mother of all ironies, Glenn, is that the young people that voted for Obama are the ones who are voluntarily putting on the shackles and chains. They will have to pay all this back. And literally, I'm not kidding, I'm a former federal tax lawyer, the young generation could potentially be looking at tax rates of 70 and 80% in their future if we go down the road that Barack Obama --! and remember, Democrats control every lever of power now in Washington. Republicans have virtually no power. So if we go down this road, they will be looking at tax rates of 70 and 80%. That's reality.

GLENN: All right. Now, I have to -- let me play truth squad with you here just a little bit. Everything here is true except the Republicans were going down this same damn road anyway.

CONGRESSWOMAN BACHMANN: No kidding. No kidding. It was embarrassing and that's why we lost and we deserve to lose because the biggest strategic blunder of '08 is that our nominee, John McCain, jumped on board with the bailout.

GLENN: Exactly right.

CONGRESSWOMAN BACHMANN: And also some of the Republican leadership here in the congress. That was the biggest strategic blunder. I was against the bailout from the get-go and was very vocal here in our conference against it and probably got into trouble for it. But it was the wrong thing at the wrong time, and I'll continue to be a voice for fiscal conservativism.

GLENN: All right. So what happens -- because this is what everybody says to me: Glenn, you are just going to let everything fail? I mean, the system will need to be reboot. You are going to just, you are just going to look families in the eye and say, "Sorry, you don't have a job anymore?"

CONGRESSWOMAN BACHMANN: No, what we need is real prosperity and real stimulus, and it's actually not that difficult to do. We have the second highest corporate tax rate in the world in the United States. It's at 35%. We should drastically cut the business tax rate and we should drastically cut the capital gains tax. What capital gains does, that's when you take your private money and you invest it and then when you reap the benefit of that, the gain, government wants a piece of that action. If we drastically lower capital gains, drastically lower the corporate tax rate, we will actually increase revenue to the government tremendously because we'll jump start our economic powerhouse. We could turn our economy around within about 12 to 15 months if we dramatically lower tax rates. That's true stimulus. All through the 1930s we adopted this dramatic influx of government monies, which is actually your money, and I'll tell you what after nearly a decade of dramatic ! government intervention, Henry Morgenthau who was the treasury secretary in 1939 said we have never spent more money in the history of the United States from the government to pump money into the economy. And he said, it didn't work. We can't go down this road. So we've done this before. We did it under FDR, we adopted the strategy under LBJ, under Jimmy Carter. We know it doesn't work. What works is Calvin Coolidge, JFK, Ronald Reagan: Cut taxes dramatically. That's true stimulus.

GLENN: All right. Let me ask you a real quick question, then I want to move to something else because you are a tax attorney. So I want to talk about the new treasury secretary with you but first I want to ask you this: Doesn't it seem to make common sense if you want to cut the tax rates, what you are doing is you are inviting people to invest in America, invest in American companies because they can keep more of their money, the companies can grow and keep more of their money, et cetera, et cetera, especially when -- I have not heard anybody talk about this, and I think this is colossal news. Spain, Ireland, Italy, and there's another big one that is about to be downgraded in their credit scores by Moody's. If that happens, it will crush the Euro, the Euro will spiral out of control which will -- people will rush to the dollar because they are going to look for something, which will make it harder for us to be able to export any goods beca! use they won't be able to afford it because their dollar is worth so much. Wouldn't it be the right time to cut our corporate tax rates and help businesses along through tax policies? Because people, when they're looking for a place to shelter their money from overseas, will invest in American companies?

CONGRESSWOMAN BACHMANN: You are exactly right. Because right now I was up in New York -- that's where I met you a couple of days ago when I was meeting with some investors up there. And I asked them, tell me the best formula. That's what they told me. There are very few places that people know where to go to have a safe haven for their dollar. If we dramatically cut the corporate tax rate and cut also the capital gains rate, people will see this as a long-term investment. That's why Obama's plan of redistribution of wealth -- because let's face it, that's what this is. He wants to -- his so-called tax cuts are basically welfare checks that will be written to the 40% of Americans who pay no taxes in this country. You can't give tax cuts to people who don't pay taxes. So if we cut taxes on the means of introducing more prosperity into the United States, that will allow people to have jobs and also increases.

GLENN: We used to call the bailouts corporate welfare. Now the TARP program, Obama wants to change the name of it because it's been Sullied, I don't think it ever had a good name, except corporate welfare. I'm not sure if he wants to change it back to corporate welfare. But the designer, the architect of the TARP program is possibly going to be our treasury secretary. I've seen that he didn't pay his income tax properly in an unbelievable fashion. I've seen the arrogance after he --

CONGRESSWOMAN BACHMANN: And this is why he was the Federal Reserve chair in New York. That's what's really rich about this.

GLENN: It's really amazing. Could this have been an honest mistake from a genius in the financial market? Could you make this series of mistakes?

CONGRESSWOMAN BACHMANN: A person can always make mistakes, but let's face it. When he's in a position of being the federal reserve chair from New York, you would think if you are not watching your own finances, you would have an accountant who was. This was simple paying of his self-employment taxes. He didn't pay his Social Security tax. He didn't pay his Medicare tax. Glenn, I just want to say this: The double standard that we saw during the last election with the media, present company excepted, is continuing with this appointment. Trust me, if this was a Republican administration, you would have a constant drumbeat against this fellow. This treasury secretary nominee is arguably one of the most important appointments of the Obama administration.

GLENN: It is.

CONGRESSWOMAN BACHMANN: He will be observing and he will be over over a trillion dollars potentially of new spending. He will also run IRS, the very organization that's auditing your listeners, and he didn't even follow his own law. You have to have someone running the agency who observes the rule of law. Not only did he not pay his taxes, he only just paid them in November when he thought he was going to get appointed to this job, and he has problems with household help that he hired. This guy is replete with problems. And if it wasn't the Obama administration, this guy would have been run out of town. He wouldn't be allowed to be nominated. And really Obama needs to withdraw his nomination.

GLENN: Okay. Michele, I thank you very much for being on -- I'm sorry, Congresswoman Bachmann.

CONGRESSWOMAN BACHMANN: Michele, Glenn.

GLENN: It's nice to have you here. And I would like to know for the Republicans and Democrats, the people who are in there fighting an honest fight -- and I also have to thank you. I hate fluorescent light bulbs. I hate them. It is the Bain of my existence.

CONGRESSWOMAN BACHMANN: Oh, you and me both, baby.

GLENN: You were the one who wrote up the light bulb freedom of choice act.

CONGRESSWOMAN BACHMANN: Yeah, freedom of choice.

GLENN: I thought everybody was pro choice. I don't want fluorescent light bulbs!

CONGRESSWOMAN BACHMANN: They are horrible. Nancy Pelosi snuck into my office one night and replaced all my incandescents with these terrible pigtail looking light bulbs. It's the worst lights. They either don't work well or they -- they're terrible.

GLENN: I was in the oval office and I actually -- the President was standing there talking and I just kind of looked down into the lamp. They are fluorescents in there. If he wasn't the President of the United States, I would have had a tantrum. All right, thanks a lot. I appreciate it, Congresswoman.

CONGRESSWOMAN BACHMANN: We'll stay in touch. Thanks, Glenn.

Rapper Kendrick Lamar brings white fan onstage to sing with him, but here’s the catch

Matt Winkelmeyer/Getty Images for American Express

Rapper Kendrick Lamar asked a fan to come onstage and sing with him, only to condemn her when she failed to censor all of the song's frequent mentions of the “n-word" while singing along.

RELATED: You'll Never Guess Who Wrote the Racist Message Targeting Black Air Force Cadets

“I am so sorry," she apologized when Lamar pointed out that she needed to “bleep" that word. “I'm used to singing it like you wrote it." She was booed at by the crowd of people, many screaming “f*** you" after her mistake.

On Tuesday's show, Pat and Jeffy watched the clip and talked about some of the Twitter reactions.

“This is ridiculous," Pat said. “The situation with this word has become so ludicrous."

What happened?

MSNBC's Katy Tur didn't bother to hide her pro-gun control bias in an interview with Texas Attorney General Ken Paxton in the wake of the Santa Fe High School killings.

RELATED: Media Are Pushing Inflated '18 School Shootings' Statistic. Here Are the Facts.

What did she ask?

As Pat pointed out while sitting in for Glenn on today's show, Tur tried to “badger" Paxton into vowing that he would push for a magical fix that will make schools “100 percent safe." She found it “just wild" that the Texas attorney general couldn't promise that schools will ever be completely, totally safe.

“Can you promise kids in Texas today that they're safe to go to school?" Tur pressured Paxton.

“I don't think there's any way to say that we're ever 100 percent safe," the attorney general responded.

What solutions did the AG offer?

“We've got a long way to go," Paxton said. He listed potential solutions to improve school safety, including installing security officers and training administrators and teachers to carry a gun.

Pat's take:

“Unbelievable," Pat said on today's show. “Nobody can promise [100 percent safety]."

Every president from George Washington to Donald Trump has issued at least one executive order (with the exception of William Harrison who died just 31 days into his presidency) and yet the U.S. Constitution doesn't even mention executive orders. So how did the use of this legislative loophole become such an accepted part of the job? Well, we can thank Franklin Roosevelt for that.

Back at the chalkboard, Glenn Beck broke down the progression of the executive order over the years and discussed which US Presidents have been the “worst offenders."

RELATED: POWER GRAB: Here's how US presidents use 'moments of crisis' to override Constitutional law

“It's hard to judge our worst presidential overreachers on sheer numbers alone," said Glenn. “However, it's not a shock that FDR issued by far the most of any president."

Our first 15 presidents issued a combined total of 143. By comparison, Franklin D. Roosevelt issued 3721, more than twice the next runner up, Woodrow Wilson, at 1803.

“Next to FDR, no other president in our history attempted to reshape so much of American life by decree, until we get to this guy: President Obama," Glenn explained. “He didn't issue 3000, or even 1800; he did 276 executive orders, but it was the power of those orders. He instituted 560 major regulations classified by the Congressional Budget Office as having 'significant economic or social impacts.' That's 50 percent more regulations than George W. Bush's presidency — and remember, everybody thought he was a fascist."

President Obama blamed an obstructionist Congress for forcing him to bypass the legislative process. By executive order, President Obama decreed the U.S. join the Paris Climate Accord, DACA, the Clean Power Plan and transgender restrooms. He also authorized spying in US citizens through section 702 of FISA, used the IRS to target political opponents and ordered military action in Libya without Congressional permission.

All of these changes were accepted by the very people who now condemn President Trump for his use of executive orders — many of which were issued to annul President Obama's executive orders, just as President Obama annulled President Bush's executive orders when he took office … and therein lies the rub with executive orders.

“That's not the way it's supposed to work, nor would we ever want it to be," said Glenn. “We have to have the Constitution and laws need to originate in Congress."

Watch the video above to find out more.

Six months ago, I alerted readers to the very attractive benefits that the TreasuryDirect program offers to investors who are defensively sitting on cash right now.

Since then, those benefits have continued to improve. Substantially.

Back in November, by holding extremely conservative short-term (i.e., 6-months or less) Treasury bills, TreasuryDirect participants were receiving over 16x more in interest payments vs keeping their cash in a standard bank savings account.

Today, they're now receiving over 30 times more. Without having to worry about the risk of a bank "bail-in" or failure.

So if you're holding cash right now and NOT participating in the TreasuryDirect program, do yourself a favor and read on. If you're going to pass on this opportunity, at least make it an 'eyes-wide-open' decision.

Holding Cash (In Treasurys) Now Beats The Market

There are many prudent reasons to hold cash in today's dangerously overvalued financial markets, as we've frequently touted here at PeakProsperity.com.

Well, there's now one more good reason to add to the list: holding cash in short-term Treasurys is now meeting/beating the dividend returns offered by the stock market:

"Cash Is King" Again - 3-Month Bills Yield More Than Stocks (Zero Hedge)
'Reaching for yield' just got a lot easier...
For the first time since February 2008, three-month Treasury bills now have a yield advantage over the S&P; 500 dividend yield (and dramatically lower risk).
Investors can earn a guaranteed 1.90% by holding the 3-month bills or a risky 1.89% holding the S&P; 500...

The longest period of financial repression in history is coming to an end...

And it would appear TINA is dead as there is now an alternative.

And when you look at the total return (dividends + appreciation) of the market since the start of 2018, stocks have returned only marginally better than 3-month Treasurys. Plus, those scant few extra S&P; points have come with a LOT more risk.

Why take it under such dangerously overvalued conditions?

If You Can't Beat 'Em, Join 'Em

In my June report Less Than Zero: How The Fed Killed Saving, I explained how the Federal Reserve's policy of holding interest rates at record lows has decimated savers. Those who simply want to park money somewhere "safe" can't do so without losing money in real terms.

To drive this point home: back in November, the average interest rate being offered in a US bank savings account was an insutling 0.06%. Six months later, nothing has changed:

(Source

That's virtually the same as getting paid 0%. But it's actually worse than that, because once you take inflation into account, the real return on your savings is markedly negative.

And to really get your blood boiling, note that the Federal Reserve has rasied the federal funds rate it pays banks from 1.16% in November to 1.69% in April. Banks are now making nearly 50% more money on the excess reserves they park at the Fed -- but are they passing any of that free profit along to their depositors? No....

This is why knowing about the TreasuryDirect program is so important. It's a way for individual investors savvy enough to understand the game being played to bend some of its rules to their favor and limit the damage they suffer.

Below is an updated version (using today's rates) of my recap of TreasuryDirect, which enables you to get over 30x more interest on your cash savings than your bank will pay you, with lower risk.

TreasuryDirect

For those not already familiar with it, TreasuryDirect is a service offered by the United States Department of the Treasury that allows individual investors to purchase Treasury securities such as T-Bills, notes and bonds directly from the U.S. government.

You purchase these Treasury securities by linking a TreasuryDirect account to your personal bank account. Once linked, you use your cash savings to purchase T-bills, etc from the US Treasury. When the Treasury securities you've purchased mature or are sold, the proceeds are deposited back into your bank account.

So why buy Treasuries rather than keep your cash savings in a bank? Two main reasons:

  • Much higher return: T-Bills are currently offering an annualized return rate between 1.66-2.04%. Notes and bonds, depending on their duration, are currently offering between 2.6% - 3.1%
  • Extremely low risk: Your bank can change the interest rate on your savings account at any time -- with Treasury bills, your rate of return is locked in at purchase. Funds in a bank are subject to risks such as a bank bail-in or the insolvency of the FDIC depositor protection program -- while at TreasuryDirect, your funds are being held with the US Treasury, the institution with the lowest default risk in the country for reasons I'll explain more in a moment.

Let's look at a quick example. If you parked $100,000 in the average bank savings account for a full year, you would earn $60 in interest. Let's compare this to the current lowest-yielding TreasuryDirect option: continuously rolling that same $100,000 into 4-week T-Bills for a year:

  1. Day 1: Funds are transferred from your bank account to TreasuryDirect to purchase $100,000 face value of 4-week T-Bills at auction yielding 1.68%
  2. Day 28: the T-Bills mature and the Treasury holds the full $100,000 proceeds in your TreasuryDirect account. Since you've set up the auto-reinvestment option, TreasuryDirect then purchases another $100,000 face value of 4-week T-Bills at the next auction.
  3. Days 29-364: the process repeats every 4 weeks
  4. Day 365: assuming the average yield for T-Bills remained at 1.68%, you will have received $1,680 in interest in total throughout the year from the US Treasury.

$1,680 vs $60. That's a 27x difference in return.

And the comparison only improves if you decide to purchase longer duration (13-week or 26-week) bills instead of the 4-week ones:

Repeating the above example for a year using 13-week bills would yield $1,925. Using 26-week bills would yield $2,085. A lot better (34x better!) than $60.

Opportunity Cost & Default Risk

So what are the downsides to using TreasuryDirect? There aren't many.

The biggest one is opportunity cost. While your money is being held in a T-Bill, it's tied up at the US Treasury. If you suddenly need access to those funds, you have to wait until the bill matures.

But T-Bill durations are short. 4 weeks is not a lot of time to have to wait. (If you think the probability is high you may to need to pull money out of savings sooner than that, you shouldn't be considering the TreasuryDirect program.)

Other than that, TreasuryDirect offers an appealing reduction in risk.

If your bank suddenly closes due to a failure, any funds invested in TreasuryDirect are not in your bank account, so are not subject to being confiscated in a bail-in.

Instead, your money is held as a T-Bill, note or bond, which is essentially an obligation of the US Treasury to pay you in full for the face amount. The US Treasury is the single last entity in the country (and quite possibly, the world) that will ever default on its obligations. Why? Because Treasurys are the mechanism by which money is created in the US. Chapter 8 from The Crash Course explains:

As a result, to preserve its ability to print the money it needs to function, the US government will bring its full force and backing to bear in order to ensure confidence in the market for Treasurys.

Meaning: the US government won't squelch on paying you back the money you lent it. If required, it will just print the money it needs to repay you.

So, How To Get Started?

Usage of TreasuryDirect is quite low among investors today. Many are unaware of the program. Others simply haven't tried it out.

And let's be real: it's crazy that we live in a world where a 1.68-2.09% return now qualifies as an exceptionally high yield on savings. A lot of folks just can't get motivated to take action by rates that low. But that doesn't mean that they shouldn't -- money left on the table is money forfeited.

So, if you're interested in learning more about the TreasuryDirect program, start by visiting their website. Like everything operated by the government, it's pretty 'no frills'; but their FAQ page addresses investors' most common questions.

Before you decide whether or not to fund an account there, be sure to discuss the decision with your professional financial advisor to make sure it fits well with your personal financial situation and goals. (If you're having difficulty finding a good one, consider scheduling a free discussion with PeakProsperity.com's endorsed financial advisor -- who has considerable experience managing TreasuryDirect purchases for many of its clients).

In Part 2: A Primer On How To Use TreasuryDirect, we lay out the step-by-step process for opening, funding and transacting within a TreasuryDirect account. We've created it to be a helpful resource for those self-directed individuals potentially interested in increasing their return on their cash savings in this manner.

Yes, we savers are getting completely abused by our government's policies. So there's some poetic justice in using the government's own financing instruments to slightly lessen the sting of the whip.

Click here to read Part 2 of this report (free executive summary, enrollment required for full access)

NOTE: PeakProsperity.com does not have any business relationship with the TreasuryDirect program. Nor is anything in the article above to be taken as an offer of personal financial advice. As mentioned, discuss any decision to participate in TreasuryDirect with your professional financial advisor before taking action.