HAPPY 10TH ANNIVERSARY OF THE BEGINNING OF THE END

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Posted on 9th March 2013 by Administrator in Economy |Politics |Social Issues

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An Iraqi citizen describes how the Great American liberators implemented democracy in Iraq:

 “It is like I am standing naked in a room with a big hat on my head. Everyone comes in and helps put flowers and ribbons on my hat, but no one seems to notice that I am naked.”

The neo-cons set in motion a chain of events that will ultimately result in the collapse of the Great American Empire. The hubris and arrogance of our leaders over the last ten years is a reflection of our military industrial complex capturing the government in collusion with the Wall Street cabal and bankrupting the nation through foreign aggression and domestic pillaging of the middle class. The warfare/welfare state benefits bankers, arms dealers, and mega-corporations. They use their riches to buy off the politician puppets in Washington.

Their lackey at the Federal Reserve prints the fiat currency needed to sustain and further their enrichment. The corporate media provides the storylines of terrorists, imminent threats from 3rd world countries sitting on our oil, and our successes in helping Iraqis, Afghans, Libyans and all of the peoples yearning to be free like us.  

We build chicken factories in the desert, fake its success, have our leaders proclaim the success to the corporate media, and the MSM mouthpieces do their duty. Edward Bernays would be so proud of what America has become.

HAPPY 10th ANNIVERSARY!!!

Maybe George W. can land a fighter on one of our $30 billion aircraft carriers and make his famous declaration again. Or maybe a Zeppelin would be more appropriate.

 

The Worst Mistake in U.S. History — America Will Never Recover from Bush’s Great Foreign Policy Disaster

By Peter Van Buren

Ten years ago, George Bush made a decision that this country will regret for a very long time.
 

Photo Credit: Shutterstock.com

March 7, 2013  |  
 
I was there. And “there” was nowhere. And nowhere was the place to be if you wanted to see the signs of end times for the American Empire up close. It was the place to be if you wanted to see the madness — and oh yes, it was madness — not filtered through a complacent and sleepy media that made Washington’s war policy seem, if not sensible, at least sane and serious enough. I stood at Ground Zero of what was intended to be the new centerpiece for a Pax Americana in the Greater Middle East.

Not to put too fine a point on it, but the invasion of Iraq turned out to be a joke. Not for the Iraqis, of course, and not for American soldiers, and not the ha-ha sort of joke either. And here’s the saddest truth of all: on March 20th as we mark the 10th anniversary of the invasion from hell, we still don’t get it. In case you want to jump to the punch line, though, it’s this: by invading Iraq, the U.S. did more to destabilize the Middle East than we could possibly have imagined at the time. And we — and so many others — will pay the price for it for a long, long time.

             The Madness of King George

It’s easy to forget just how normal the madness looked back then. By 2009, when I arrived in Iraq, we were already at the last-gasp moment when it came to salvaging something from what may yet be seen as the single worst foreign policy decision in American history. It was then that, as a State Department officer assigned to lead two provincial reconstruction teams in eastern Iraq, I first walked into the chicken processing plant in the middle of nowhere.

By then, the U.S. “reconstruction” plan for that country was drowning in rivers of money foolishly spent. As the centerpiece for those American efforts — at least after Plan A, that our invading troops would be greeted with flowers and sweets as liberators, crashed and burned — we had managed to reconstruct nothing of significance. First conceived as a Marshall Plan for the New American Century, six long years later it had devolved into farce.

In my act of the play, the U.S. spent some $2.2 million dollars to build a huge facility in the boondocks. Ignoring the stark reality that Iraqis had raised and sold chickens locally for some 2,000 years, the U.S. decided to finance the construction of a central processing facility, have the Iraqis running the plant purchase local chickens, pluck them and slice them up with complex machinery brought in from Chicago, package the breasts and wings in plastic wrap, and then truck it all to local grocery stores. Perhaps it was the desert heat, but this made sense at the time, and the plan was supported by the Army, the State Department, and the White House.

Elegant in conception, at least to us, it failed to account for a few simple things, like a lack of regular electricity, or logistics systems to bring the chickens to and from the plant, or working capital, or… um… grocery stores. As a result, the gleaming $2.2 million plant processed no chickens. To use a few of the catchwords of that moment, it transformed nothing, empowered no one, stabilized and economically uplifted not a single Iraqi. It just sat there empty, dark, and unused in the middle of the desert. Like the chickens, we were plucked.

In keeping with the madness of the times, however, the simple fact that the plant failed to meet any of its real-world goals did not mean the project wasn’t a success. In fact, the factory was a hit with the U.S. media. After all, for every propaganda-driven visit to the plant, my group stocked the place with hastily purchased chickens, geared up the machinery, and put on a dog-and-pony, er, chicken-and-rooster, show.

In the dark humor of that moment, we christened the place the PotemkinChicken Factory. In between media and VIP visits, it sat in the dark, only to rise with the rooster’s cry each morning some camera crew came out for a visit. Our factory was thus considered a great success. Robert Ford, then at the Baghdad Embassy and now America’s rugged shadow ambassador to Syria, said his visit was the best day out he enjoyed in Iraq. General Ray Odierno, then commanding all U.S. forces in Iraq, sent bloggers and camp followers to view the victory project. Some of the propaganda, which proclaimed that “teaching Iraqis methods to flourish on their own gives them the ability to provide their own stability without needing to rely on Americans,” is stillonline (including this charming image of American-Iraqi mentorship, a particular favorite of mine).

We weren’t stupid, mind you. In fact, we all felt smart and clever enough to learn to look the other way. The chicken plant was a funny story at first, a kind of insider’s joke you all think you know the punch line to. Hey, we wasted some money, but $2.2 million was a small amount in a war whose costs will someday be toted up in the trillions. Really, at the end of the day, what was the harm?

The harm was this: we wanted to leave Iraq (and Afghanistan) stable to advance American goals. We did so by spending our time and money on obviously pointless things, while most Iraqis lacked access to clean water, regular electricity, and medical or hospital care. Another State Department official in Iraq wrote in his weekly summary to me, “At our project ribbon-cuttings we are typically greeted now with a cursory ‘thank you,’ followed by a long list of crushing needs for essential services such as water and power.” How could we help stabilize Iraq when we acted like buffoons? As one Iraqi told me, “It is like I am standing naked in a room with a big hat on my head. Everyone comes in and helps put flowers and ribbons on my hat, but no one seems to notice that I am naked.”

By 2009, of course, it should all have been so obvious. We were no longer inside the neocon dream of unrivaled global superpowerdom, just mired in what happened to it. We were a chicken factory in the desert that no one wanted.

Time Travel to 2003

Anniversaries are times for reflection, in part because it’s often only with hindsight that we recognize the most significant moments in our lives. On the other hand, on anniversaries it’s often hard to remember what it was really like back when it all began. Amid the chaos of the Middle East today, it’s easy, for instance, to forget what things looked like as 2003 began. Afghanistan, it appeared, had been invaded and occupied quickly and cleanly, in a way the Soviets (the British, the ancient Greeks…) could never have dreamed of. Iran was frightened, seeing the mighty American military on its eastern border and soon to be on the western one as well, and was ready to deal. Syria was controlled by the stable thuggery of Bashar al-Assad and relations were so good that the U.S. was rendering terror suspects to his secret prisons for torture.

Most of the rest of the Middle East was tucked in for a long sleep with dictators reliable enough to maintain stability. Libya was an exception, though predictions were that before too long Muammar Qaddafi would make some sort of deal. (He did.) All that was needed was a quick slash into Iraq to establish a permanent American military presence in the heart of Mesopotamia. Our future garrisons there could obviously oversee things, providing the necessary muscle to swat down any future destabilizing elements. It all made so much sense to the neocon visionaries of the early Bush years. The only thing that Washington couldn’t imagine was this: that the primary destabilizing element would be us.

Indeed, its mighty plan was disintegrating even as it was being dreamed up. In their lust for everything on no terms but their own, the Bush team missed a diplomatic opportunity with Iran that might have rendered today’s saber rattling unnecessary, even as Afghanistan fell apart and Iraq imploded. As part of the breakdown, desperate men, blindsided by history, turned up the volume on desperate measures: torture, secret gulags, rendition, drone killings, extra-constitutional actions at home. The sleaziest of deals were cut to try to salvage something, including ignoring the A.Q. Khan network of Pakistani nuclear proliferation in return for a cheesy Condi Rice-Qaddafi photo-oprapprochement in Libya.

Inside Iraq, the forces of Sunni-Shia sectarian conflict had been unleashed by the U.S. invasion. That, in turn, was creating the conditions for a proxy warbetween the U.S. and Iran, similar to the growing proxy war between Israel and Iran inside Lebanon (where another destabilizing event, the U.S.-sanctioned Israeli invasion of 2006, followed in hand). None of this has ever ended. Today, in fact, that proxy war has simply found a fresh host, Syria, with multiple powers using “humanitarian aid” to push and shove their Sunni and Shia avatars around.

Staggering neocon expectations, Iran emerged from the U.S. decade in Iraq economically more powerful, with sanctions-busting trade between the two neighbors now valued at some $5 billion a year and still growing. In that decade, the U.S. also managed to remove one of Iran’s strategic counterbalances, Saddam Hussein, replacing him with a government run by Nouri al-Malaki, who had once found asylum in Tehran.

Meanwhile, Turkey is now engaged in an open war with the Kurds of northern Iraq. Turkey is, of course, part of NATO, so imagine the U.S. government sitting by silently while Germany bombed Poland. To complete the circle, Iraq’s prime minister recently warned that a victory for Syria’s rebels will spark sectarian wars in his own country and will create a new haven for al-Qaeda which would further destabilize the region.

Meanwhile, militarily burnt out, economically reeling from the wars in Iraq and Afghanistan, and lacking any moral standing in the Middle East post-Guantanamo and Abu Ghraib, the U.S. sat on its hands as the regional spark that came to be called the Arab Spring flickered out, to be replaced by yet more destabilization across the region. And even that hasn’t stopped Washington from pursuing the latest version of the (now-nameless) global war on terror into ever-newer regions in need of destabilization.

Having noted the ease with which a numbed American public patriotically looked the other way while our wars followed their particular paths to hell, our leaders no longer blink at the thought of sending American drones and special operations forces ever farther afield, most notably ever deeper into Africa, creating from the ashes of Iraq a frontier version of the state of perpetual warGeorge Orwell once imagined for his dystopian novel 1984. And don’t doubt for a second that there is a direct path from the invasion of 2003 and that chicken plant to the dangerous and chaotic place that today passes for our American world.

Happy Anniversary

On this 10th anniversary of the Iraq War, Iraq itself remains, by any measure, a dangerous and unstable place. Even the usually sunny Department of Stateadvises American travelers to Iraq that U.S. citizens “remain at risk for kidnapping… [as] numerous insurgent groups, including Al Qaida, remain active…” and notes that “State Department guidance to U.S. businesses in Iraq advises the use of Protective Security Details.”

In the bigger picture, the world is also a far more dangerous place than it was in 2003. Indeed, for the State Department, which sent me to Iraq to witness the follies of empire, the world has become ever more daunting. In 2003, at that infamous “mission accomplished” moment, only Afghanistan was on the list of overseas embassies that were considered “extreme danger posts.” Soon enough, however, Iraq and Pakistan were added. Today, Yemen and Libya, once boring but secure outposts for State’s officials, now fall into the same category.

Other places once considered safe for diplomats and their families such as Syriaand Mali have been evacuated and have no American diplomatic presence at all. Even sleepy Tunisia, once calm enough that the State Department had its Arabic language school there, is now on reduced staff with no diplomatic family members resident. Egypt teeters.

The Iranian leadership watched carefully as the American imperial version of Iraq collapsed, concluded that Washington was a paper tiger, backed away from initial offers to talk over contested issues, and instead (at least for a while) doubled-down on achieving nuclear breakout capacity, aided by the past work of that same A.Q. Khan network. North Korea, another A.Q. Khan beneficiary, followed the same pivot ever farther from Washington, while it became a genuine nuclear power. Its neighbor China pursued its own path ofeconomic dominance, while helping to “pay” for the Iraq War by becoming thenumber-one holder of U.S. debt among foreign governments. It now owns more than 21% of the U.S. debt held overseas.

And don’t put away the joke book just yet. Subbing as apologist-in-chief for an absent George W. Bush and the top officials of his administration on this 10th anniversary, former British Prime Minister Tony Blair recently reminded us that there is more on the horizon. Conceding that he had “long since given up trying to persuade people Iraq was the right decision,” Blair added that new crises are looming. “You’ve got one in Syria right now, you’ve got one in Iran to come,” he said. “We are in the middle of this struggle, it is going to take a generation, it is going to be very arduous and difficult. But I think we are making a mistake, a profound error, if we think we can stay out of that struggle.”

Think of his comment as a warning. Having somehow turned much of Islam into a foe, Washington has essentially assured itself of never-ending crises that it stands no chance whatsoever of winning. In this sense, Iraq was not an aberration, but the historic zenith and nadir for a way of thinking that is only now slowing waning. For decades to come, the U.S. will have a big enough military to ensure that our decline is slow, bloody, ugly, and reluctant, if inevitable. One day, however, even the drones will have to land.

And so, happy 10th anniversary, Iraq War! A decade after the invasion, a chaotic and unstable Middle East is the unfinished legacy of our invasion. I guess the joke is on us after all, though no one is laughing.

UNFORGIVEN – PART FIVE

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Posted on 29th September 2012 by Administrator in Economy |Politics |Social Issues

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“You’d be William Munny out of Missouri, killer of women and children”. – Little Bill Daggett – Unforgiven 

 ”That’s right, I’ve killed women and children, I’ve killed just about everything that walked or crawled at one time or another, and I’m here to kill you Little Bill, for what you did to Ned” – Willam Munny – Unforgiven 

Funny thing, killin’ a man. You take away everything he’s got and everything he’s gonna have. – William Munny – Unforgiven 

Clint Eastwood’s final western was one of the darkest, most violent, vicious westerns ever made. Much of the film takes place in darkness. The tone of the film is depressing, with a drained wintery look reminiscent of High Plains Drifter. The script had been written in 1976 during our last Awakening, but Eastwood held off making the movie until 1991 when he was old enough to play the lead role. Age, stages of life, and mood are key elements in the movie, as they are in the plot playing out in the world today. Unforgiven  is a story of atonement, justice and retribution. The cold forbidding atmosphere reflects a Fourth Turning mood. We’ve entered our hibernal Crisis, with its violent struggles and compulsory sacrifices in an era of maximum danger and ultimately a fight for survival. This decisive test of human strength and fortitude was as predictable as the change in seasons. Strauss and Howe understood the generational dynamics of the country would align to create the mood change which would usher in the third Fourth Turning in American history:

“The next Fourth Turning is due to begin shortly after the new millennium, midway through the Oh-Oh decade. Around the year 2005, a sudden spark will catalyze a Crisis mood. Remnants of the old social order will disintegrate. Political and economic trust will implode. Real hardship will beset the land, with severe distress that could involve questions of class, race, nation and empire. The very survival of the nation will feel at stake. Sometime before the year 2025, America will pass through a great gate in history, commensurate with the American Revolution, Civil War, and twin emergencies of the Great Depression and World War II.” – Strauss & Howe – The Fourth Turning 

Unforgiven  follows the journey of William Munny, a cold blooded vicious bandit in his youth, turned peaceful farmer in his old age. As a widower with two kids and a failing farm, he agrees to kill two cowboys who had disfigured a prostitute in the town of Big Whiskey, in return for a reward of $1,000. In his youth he drank heavily and murdered for fun, now he was killing for money. The town is run with an iron fist by an aging gunfighter, turned sheriff, named Little Bill Daggett, who doesn’t allow guns in his town. Munny and his two companions arrive amidst a driving rain storm in the middle of the night. They proceed to execute the two cowboys, but both of Munny’s companions reveal they don’t have a stomach for killing anymore. After collecting the reward, Munny finds out that his friend Ned was captured, tortured, and murdered by Little Bill Daggett. He takes a drink of whiskey and the tale turns into a story of retribution and atonement. He arrives back in town in the pitch black of night and enters the saloon where Little Bill and his men are gathered. He guns down six men, including Little Bill. As he lies on the floor wounded, Bill laments that he doesn’t deserve to die this way. Munny declares:

“deserves got nothin’ to do with it.”

Bill tells Munny he will “see him in hell”, a sentiment which Munny agrees with. Munny then kills him. There is no rousing ending. No cheers from the audience. The ugliness of violence is portrayed realistically and myths of the Old West are demolished. You are left to meditate about the concepts of age, repute, courage, heroism and the fine line between good and evil.

The themes, atmosphere, violence, brutality and finale of this eulogy to the western genre are a perfect representation of our current dire circumstances. The town of Big Whiskey represents the United States. The sheriff rules with an iron fist over the population, but his cronies can get away with murder. Hypocrisy abounds across the U.S. as politicians use the rule of law to keep the masses controlled while rewarding their corporate and banker cronies with government handouts, tax breaks, and free money. I see Munny, his companions and the prostitutes as symbols of the flawed citizens of the United States. They’ve made mistakes, committed crimes, made poor life choices, but they ultimately tried to make an honest living as upstanding citizens. When the authorities pushed them to the brink with their overbearing regulations, brazen criminal actions and blatant institutional corruption, each constituent reacted differently. Some responded with defiance, most rolled over, some ran away, and Munny responded with viciousness and retribution.   

This is how it will play out over the next ten to fifteen years. Cynicism about solutions put forth by corrupt politicians, distrust of government bureaucrats and crooked bankers, and a society wide demoralization, as widespread unemployment and declining living standards for middle class Americans has darkened the landscape like an approaching winter storm. The disillusionment of average Americans is reflected in poll after poll, with only 20% of the population satisfied with the direction of the country versus 70% just prior to 9/11. The mood change in the country since 2005 is palpable. The gap between the Haves and the Have Nots has never been greater and continues to widen. The middle class has floundered for decades, while bankers, politicians and corporate titans have reaped vast riches through peddling debt and gaming a system rigged in their favor.

In general, are you satisfied or dissatisfied with the way things are going in the U.S. at this time?

Recent data from the Pew Foundation finds that Americans are sick of being the world’s policeman. Even conservative Republicans are becoming more isolationist in their views. This was also the case during the 1930’s in the last Fourth Turning. The vast majority of Americans want to keep our noses out of other countries’ affairs because they realize the trillions spent are bankrupting the country.

Even though Americans, by a large majority, favor slashing foreign aid, ending our three foreign wars of aggression, and no longer allowing the super rich and mega-corporations to use the 60,000 page tax code as their means to avoid taxes, our leaders increase war spending, continue to meddle in the affairs of foreign countries, and seek further tax benefits for the super rich and mega-conglomerates. The will of the people is ignored because the government has been bought by the financial and military industrial complex, with funding by the Federal Reserve and the banking cartel that pulls the strings on their puppet – Ben Bernanke.

 

I’ve previously detailed how the baby boom generation contributed to our financial quandary in Part One – For a Few Dollars More, how the traitorous deeds of the Federal Reserve over the last few decades have ruined the middle class and placed the country on the precipice of disintegration in Part Two – Fistful of Dollars, addressed the nefarious conception of a central bank in Part Three – The Good, the Bad, and the Ugly and revealed how the super rich have used the tax code and their control of politicians to pillage the nation in Part Four – Outlaw Josey Wales. Now I will detail the likely result of years of frivolous consumerism, creation of a debt tsunami, corrupt myopic leadership, crooked bankers, and a angry despondent populace. The lack of preparation by government and individuals ensures this Crisis will be far worse than it had to be. The violent clash between competing forces will be extreme, bloody and result in retribution dished out to the guilty. Ultimately, the country will need to atone for its sins.    

Preparation

“Reflect on what happens when a terrible winter blizzard strikes. You hear the weather warning but probably fail to act on it. The sky darkens. Then the storm hits with full fury, and the air is a howling whiteness. One by one, your links to the machine age break down. Electricity flickers out, cutting off the TV. Batteries fade, cutting off the radio. Phones go dead. Roads become impossible, and cars get stuck. Food supplies dwindle. Day to day vestiges of modern civilization – bank machines, mutual funds, mass retailers, computers, satellites, airplanes, governments – all recede into irrelevance. Picture yourself and your loved ones in the midst of a howling blizzard that lasts several years. Think about what you would need, who could help you, and why your fate might matter to anybody other than yourself. That is how to plan for a saecular winter. Don’t think you can escape the Fourth Turning. History warns that a Crisis will reshape the basic social and economic environment that you now take for granted.” – Strauss & Howe - The Fourth Turning

This Fourth Turning was as predictable as the seasons. The American Revolution Crisis ended in 1794. The Civil War Crisis arrived 66 years later in 1860. That abbreviated vicious Crisis ended in 1865. The Depression/World War II Crisis arrived 64 years later in 1929. Our current Crisis arrived in the 2008/2009 time frame, exactly 64 years after the end of the last Crisis. Strauss and Howe wrote their book in 1996. They knew we had about a decade to prepare for the looming winter ahead. We had time to fortify, prepare, save, not waste our seed corn on foreign adventures, and reduce all non-essential spending. Not only did we not do what needed to be done, we did the exact opposite of what needed to be done.

The reason is the country has been run by ideologue linear thinkers. Believers in linear history are constantly blindsided by the fact that history is cyclical and periods of progress are counterbalanced by periods of regression. As neo-con Republicans continue to push their lowering taxes on the rich, Christian fundamentalism, drill drill drill energy plan, bowing down to Wall Street bankers and wars on Muslims, drugs, and immigrant agenda, the mood of the country has shifted away from their falsehoods and fabrications. As ultra-liberal Democrats continue to push their agenda of ever increasing entitlements, ridiculous Keynesian stimulus, disengenuous green energy plans, blind support of corrupt unions, wars to prove they’re as tough as Republicans, pushing for gay marriage and rolling over for Wall Street bankers the people of the country have tired of their lies and deceit.

Our country had a decade to prepare for the coming tempest. All generations should have worked to elevate the moral and cultural standards of the country. Instead the decadence, selfishness, materialism and profligacy of the nation were taken to new heights. The complete lack of self control exercised by the media and the public has allowed government bureaucrats to impose despotic laws and regulations to protect us from ourselves and phantom terrorists. The Federal government needed to cut back its size and scope so that it would be nimble in the face of the Crisis. Politicians needed to prevent further civic decay by speaking bluntly and honestly to the American people about the future challenges, while stressing collective duties over personal rights. We needed a revival of citizenship over individualism, with a focus on future generations who would be left with the fallout of thirty years of debt induced societal degradation. The government should have shifted its budgetary focus away from the non-needy old to the young people of our once great Republic. The future of the country depends on the young, not the old. The preparation scorecard on all these accounts is a miserable failure:

  • Since 9/11 the American public has willingly allowed the government to strip liberties and freedoms away in the name of safety and security through passage of the Patriot Act, spying on US citizens, and wars of aggression in Iraq, Afghanistan and Libya.
  • The government wolves control the sheep through the use of fear and misinformation. The War on Terrorism is used at every opportunity to keep the sheep-like populace under control in their holding pens.
  • The corporate owned mainstream media glorifies wealth, celebrity, and sensationalism while infecting the culture with a vapid mind numbing array of TV shows and spewing toxic levels of filth and porn across the airwaves and internet.
  • The Federal government cut back its scope by increasing its annual spending to $3.8 trillion in 2011 versus the $1.6 trillion it spent in 1996, a 138% increase in fifteen years. Meanwhile, GDP only increased by 92% over this same time frame.

 

  • Our leaders prepared for the tough times ahead by increasing the National Debt from $5.2 trillion to $14.3 trillion in fifteen years, a 175% increase, or almost twice the rate of GDP growth. Rational leaders always triple their debt level when knowing harsh times are coming.
  • The blunt talk coming from politicians since 1996 included: buy an SUV with 0% financing to defeat terrorism; sure we can pay for your drug costs with Medicare Part D; home prices never fall and everyone deserves a house; free market capitalism always works; cutting taxes on the rich will increase tax revenue; they have weapons of mass destruction; debt doesn’t matter; giving bankers $700 billion will save our economy; spending $800 billion will generate 3.5 million jobs; and QE2 will reduce mortgage rates and jump start the economy.
  • Our leaders have thrown the Millenial generation under the bus, while promising to never cut Medicare, Medicaid, or Social Security for the 76 million Boomers that make up the largest voting bloc in the country. The collective long-term survival of the country has been cast aside in the name of the selfish desires of the generations in power.

The lack of cultural and civic preparation has been far outdone by the extraordinarily deficient amount of preparation in the economic and military areas. Everyone knows that when you discern tumultuous times are on the horizon, you conserve, save, and marshal your forces for the coming storm. Our leaders needed to level with Americans and tell them the entitlements they were promised could never be honored. Americans needed to ramp up their savings and become more self reliant in preparing for their old age. Federal, state and local governments needed to shift their employees from defined benefit plans to defined contribution plans. Americans needed to pare back their debt and stop over-consuming. The government needed to balance budgets, reform the tax code shifting toward consumption, and reduce entitlement promises. America needed to gird for a possible war whose scale, cost, manpower and casualties would seem impossible in 1996 (every prior Fourth Turning led to all encompassing war). The preparation scorecard for these areas was dreadful:

  • The most damning data in proving how delusional the government, consumers, businesses and banks has approached the future is the rise in total credit market debt from $18 trillion in 1996 to an all-time high of $52.6 trillion today, or 350% of GDP.

 

  • Rather than level with people and explain that entitlement promises could not be fulfilled, a supposedly fiscal conservative Republican President added another $15 trillion unfunded liability to our $100 trillion obligation. 

   

  • Our current socialist president rammed through a national healthcare bill that will filter 30 million people into the system and will add in excess of $1 trillion of unpaid for costs, further burying the hopes and dreams of our youth under a mountain of un-payable obligations.
  • Americans, who used to save 10% of their disposable income, were only saving 5.5% in 1996. Rather than prepare for the future by saving more, they put their faith in housing values growing 10% per year for infinity, and let their savings rate drop below 1% by 2005. The current level of 4.9% is not sufficient and is reflected in the fact that two-thirds of all workers have less than $50,000 in total savings.

 

  • States have unfunded pension liabilities approaching $3 trillion, with the Federal government carrying a $1 trillion pension liability. Unfunded liabilities are really future tax increases on unborn generations.
  • The one area that seemed under control in the late 1990s was budget deficits. Budget surpluses in the late 1990s turned into $1.5 trillion annual deficits today and as far as the eye can see. The national debt at 95% of GDP has past the point of no return.
  • The price for a barrel of oil was $12 in 1998. Rather than take advantage of this Indian summer and creating a plan to transition from depleting oil to other energy sources, our leaders did nothing. The American people bought massive SUVs, minivans and pickups and moved further into the suburban countryside, miles from civilization. The bumpy plateau of peak oil has arrived and oil prices have ranged between $70 and $140 a barrel for the last few years. We will long for these prices in a few short years.

 

  • Rather than conserving our military forces and preparing for a future major confrontation we have overextended our limited forces, spent $1.2 trillion on wars of choice, killed 7,300 American soldiers, and wounded another 43,000 soldiers.

The complete lack of preparation, indeed the choice to actively do the opposite of prepare, has insured this Fourth Turning Crisis will be that much more destructive.

“History offers no guarantees. If America plunges into an era of depression or violence which by then has not lifted, we will likely look back on the 1990s as the decade when we valued all the wrong things and made all the wrong choices.” – Strauss & Howe - The Fourth Turning

Retribution

“The refusal of the political class to imposes losses on large bank creditors since the collapse of Lehman Brothers and Washington Mutual in 2008 illustrates the extent to which the financialization of the western industrial economies has turned into a gradual coup d’état by the banks and the global speculators who dominate their client base.” – Chris Whalen

 

“We’re not moving toward Hitler-type fascism, but we’re moving toward a softer fascism: Loss of civil liberties, corporations running the show, big government in bed with big business. So you have the military-industrial complex, you have the medical-industrial complex, you have the financial industry, you have the communications industry. They go to Washington and spend hundreds of millions of dollars. That’s where the control is. I call that a soft form of fascism — something that’s very dangerous.” – Ron Paul 

As the average American continues their epic struggle to stay afloat in these turbulent times it is clear to those with critical thinking skills, like Chris Whalen and Ron Paul, that the game is rigged in favor of those with enormous wealth and power. There is no doubt the levers of government and finance have been seized by a super rich minority of men, willing to use all means necessary to increase their wealth and power at the expense of those they consider lowly expendable peasants. The myth perpetuated by those in control of the system is that everyone in America has ample opportunity to move up the ladder, even as they push the ladders away from the parapet surrounding their castle.

The talking points of the super rich, which are pounded into the brains of slumbering Americans, are they pay all the taxes, create all the jobs, create all the wealth, and drive innovation. The facts say otherwise. The super rich aren’t creators, they are destroyers. The top 0.1% richest Americans didn’t get rich by creating new companies and letting their entrepreneurial talents shine. These 152,000 people, with an average income of $5.6 million per year are overwhelmingly executives at large corporations, banks, law firms, and real estate firms. These people account for 68% of the richest of the rich. Entrepreneurial creators and producers account for less than 10% of the richest Americans. The executives that make up the 68% are masters of creating debt, wealth for themselves by peddling debt to the middle class, and creating jobs in China and India by outsourcing U.S. jobs.

The average income of the 137 million people that sit at the bottom of the income pyramid has declined by 1% since 1970. The people at the top of the pyramid saw their average income rise by 385%. Was this because they worked harder? No. It was because they used their existing wealth to buy politicians and pay lobbyists to write laws, create loopholes, reduce regulations, and alter the tax code in their favor. This was not a conspiracy. It was human nature. Humans are driven by greed and fear. Lusting for power and wealth is a common human frailty. Those who are able to acquire wealth and power through their superior abilities and intellect are usually driven individuals. It is built into their DNA to seek more wealth and power. There are 310 million Americans and based on the chart below, only 1.5 million would be classified as very rich or extremely rich. Many of these people associate in the same circles. This incestuous relationship is what breeds the growing inequality in our country. The game is rigged in favor of these 1.5 million people because they run the corporations, occupy the halls of Congress, peddle the debt products to the bottom 90%, and use their mass media to control the message to the under-educated, over-medicated, gadget distracted masses.

 

The problem with humans is they always push the envelope too far. The rich and powerful have methodically accumulated more wealth and more power since their glorious coup in 1913 with the creation of the Federal Reserve and the personal income tax. They have used inflation and the tax code to further their agenda. The rate of their pillaging has waxed and waned over the last century as the mood of the country has oscillated during the five turnings between crisis and triumph. The rate of looting has accelerated in the last thirty years as their false message of free market capitalism, lower tax rates for the rich, and the issuance of unparalleled amounts of debt was bought hook line and sinker by the American public. Their plundering of the national wealth reached a sickening crescendo in the last ten years, as their internet bubble was replaced by their housing bubble, which has been replaced by their debt bubble of immense proportions. As the middle class has been impoverished, 30 million people are unemployed or underemployed, senior citizens have been sacrificed at the altar of Wall Street and 45 million people are forced to use food stamps, the top 1% has done fabulously. They continue to rake in a greater proportion of the national income every year.  In 2009, in the midst of an epic financial crisis, the number of millionaires in the United States soared by 16% to 7.8 million as despair and hopelessness spread across the land and fearful Americans were railroaded into bailing out the bankers that initiated the crisis and believing the Obama’s Keynesian solutions would actually trickle down to them.

 

As the game approaches its inevitable termination those in control have become increasingly audacious and frantic in their attempts to embezzle what remains of middle class wealth. The anger and disillusionment grows by the day. The mood of the country darkens like the sky before an approaching blizzard. The intensity and violence during a Fourth Turning hastens as events spiral toward a climax. The extreme actions taken by those in power since September 2008 have set in motion a chain of events that will lead to civil war. The powerful elite in government (Bush, Paulson, Bernanke, Congress) chose to bail out the powerful elite on Wall Street (Blankfein, Dimon, Pandit, Lewis) on the backs of the American middle class. TARP, QE1, QE2, and the $800 billion stimulus package were all created by the ruling elite to benefit the ruling elite, who control the vast amount of financial wealth in the country. Savers and seniors have been thrown under the wheels of a Lamborghini driven by the profligate Wall Street gamblers.

financial-wealth-united-states

Average Americans feel betrayed by politicians, bankers and corporate America. The Tea party movement is a reflection of that anger. Fourth Turnings always sweep away the old order and replace it with a new order. The old order isn’t ready to be swept away, but their time is coming. The U.S. economic model is unsustainable and is guaranteed to collapse in the near future. Those in power are trying to engineer a controlled collapse, but they will lose control just as they did in 2008. Panic and depression will ensue. Vast amounts of wealth will be destroyed. When the middle class realizes they have been screwed again by Wall Street and K Street, and they no longer have anything left to lose, they will lose it.

The welfare class will only riot if their EBT cards stop working and the monthly welfare direct deposit ceases. It’s the critical thinkers in the middle class that will lead a revolution. There are 250 million guns owned by Americans. With this amount of firepower and millions of Americans with nothing left to lose, those attempting to retain power will be at a distinct disadvantage. I believe armed vigilantes will hunt down those responsible for the destruction of the American economy and invoke their own justice. Their gated communities and penthouse suite doormen will not protect them. No politician, banker, or corporate executive will be safe. Some will escape in their Lear jets to foreign lands, but the rest of the world will be equally chaotic and unsafe for those who committed crimes against humanity. Innocent people will die. Deserve will have nothing to do with it. The very existence of our country will hang in the balance.

Atonement

“The seasons of time offer no guarantees. For modern societies, no less than for all forms of life, transformative change is discontinuous. For what seems an eternity, history goes nowhere – and then it suddenly flings us forward across some vast chaos that defies any mortal effort to plan our way there. The Fourth Turning will try our souls – and the saecular rhythm tells us that much will depend on how we face up to that trial. The saeculum does not reveal whether the story will have a happy ending, but it does tell us how and when our choices will make a difference.”  – Strauss & Howe - The Fourth Turning

“Don’t think you can escape the Fourth Turning the way you might today distance yourself from news, national politics, or even taxes you don’t feel like paying. History warns that a Crisis will reshape the basic social and economic environment that you now take for granted. The Fourth Turning necessitates the death and rebirth of the social order. It is the ultimate rite of passage for an entire people, requiring a luminal state of sheer chaos whose nature and duration no one can predict in advance.” – Strauss & Howe - The Fourth Turning

No one can predict the exact events (debt ceiling, Euro collapse, Middle East war) that will propel this Fourth Turning. But, the underlying drivers are clear: public debt, private debt, banker coup, military overreach, corporate fascism, Federal Reserve created inflation, an oil dependent society with depleting oil and rampant corruption across all levels of government. The fingers of instability grow longer as we add $4 billion per day to the national debt. A grain of sand will fall on the wrong part of the sand pile triggering a collapse of our currency. The event is unknown, the timing unclear, but the destination is certain. A dollar collapse will trigger a surge in interest rates, which will be fatal to our debt bloated society. Every previous Fourth Turning involved revolutionary aspects. The American Revolution and Civil War were wars of revolution. The stirrings of revolution were rampant in the early 1930s, with a plot foiled by General Smedley Butler. The New Deal was a response designed to quell discontent among the masses. Enough people are becoming aware of who to blame for the ills in our society that Henry Ford’s prediction is ever closer to being realized:

“It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before morning.”

 

An uprising against the super rich and their banking cartel partners in crime is in the cards over the next ten years. Our society has degenerated and has been ransacked by sociopaths in suits as Jesse from Jesse’s Café Americain  so eloquently states:

“Not all sociopaths wield knives and knotted cords. Some wear suits, and are exceptionally intelligent and articulate, obsessively driven, and are able to use and undermine the law and the rules for their advantage, like weapons.  It is never about the win, never about the money.  It is about the kill, the expression of their hatred, about elevating themselves with the suffering of others. Bind, torture, kill.  Not only with ropes and knives, but also with power and money, and the subversion of law.  Lawlessness is their addiction, their will to power.

When societies become lax and complacent, these sociopaths can possess great political power through great amounts of unprincipled money.  And over time they become almost anti-human, destroyers of all that is good, all that is life, all that offends their insatiable sickness with its goodness.  They twist the public against itself, and turn a broad sweep of society into their killing grounds. This is the undeniable lesson of the last century.  There are monsters, and they walk among us.” 

Human beings are a flawed species. We are often driven by emotion rather than reason. We are easily convinced of things we want to be convinced about. Those with superior intelligence often take advantage of those with inferior intelligence. We are prone to mass hysteria and believing things that, in retrospect, were utterly ridiculous. We can be swayed by fear and greed in alternating degrees of delusion. History teaches us that this time isn’t different. We’ve experienced depression, war and social upheaval on an epic scale three times since the founding of this country. With only three data points it is tough to discern patterns that would reveal exactly how this Fourth Turning will play out. But it is apparent to me that each Fourth Turning alternates between a mostly external struggle and a mostly internal struggle. The American Revolution was a struggle against an external oppressor – Great Britain. The Civil War was an internal struggle between the industrial North and the agrarian South. The Depression/World War II struggle was mainly against an external threat – Germany, Japan, and Italy.

The Fourth Turnings that centered upon an external threat ended with a glorious High. The Civil War Fourth Turning resolution felt more like defeat, with the country exhausted, bitter and angry. All indications are this Fourth Turning will be mainly an internal struggle between the ruling class of bankers, business elites, and politicians and the downtrodden middle class. The lying, cheating, fraud, theft and other wrongs committed by those in power will need to be atoned for. The generational dynamics in place will drive the reactions of the country moving forward. We have been badly led. A vast swath of the populace has lived beyond their means. The existing system is unsustainable. The Boomer generation does not want to yield on their perceived entitlements. The Millenial generation will be saddled with un-payable debts. Generation X is caught in the middle of this generational struggle. The huge imbalances in our society have built up over decades like flood waters behind a weakening levee. When the levee breaks the existing order will be swept away in the raging torrent that will follow.

The ruling class will be stripped of their unseemly acquired wealth; the Boomer generation will be scorned for their reckless disregard for future generations and stripped of their entitlements; Generation X will resign themselves to a lower standard of living, knowing full well by doing so, their children will not be saddled with crushing levels of debt; Millenials will have borne the burden of the revolution and violence which will be inevitable as the ruling class fights to retain their dominating position in society.  Darkness descends upon our land. Storm clouds gather on the horizon. We’ve all played a part in the catastrophe that lies before us. Everyone in our crumbling society will need to atone for its sins, whether they deserve to or not. Will Munney was not an innocent man, but he ultimately atoned for his sins by digging deep into his soul and finding the strength and fortitude to fight the evil establishment. Each generation’s rendezvous with destiny awaits. There are no guarantees. The myth of American Exceptionalism will not protect us from the choices we’ve made. God will not shield us from the consequences of our actions. The American Empire hangs in the balance. As the ghosts of Roman emperors whisper – Glory is fleeting.

“The risk of catastrophe will be very high. The nation could erupt into insurrection or civil violence, crack up geographically, or succumb to authoritarian rule. If there is a war, it is likely to be one of maximum risk and effort – in other words, a total war. Every Fourth Turning has registered an upward ratchet in the technology of destruction, and in mankind’s willingness to use it.” – Strauss & Howe - The Fourth Turning

“History offers no guarantees. Obviously, things could go horribly wrong – the possibilities ranging from a nuclear exchange to incurable plagues, from terrorist anarchy to high-tech dictatorship. We should not assume that Providence will always exempt our nation from the irreversible tragedies that have overtaken so many others: not just temporary hardship, but debasement and total ruin. Losing in the next Fourth Turning could mean something incomparably worse. It could mean a lasting defeat from which our national innocence – perhaps even our nation – might never recover.” – Strauss & Howe - The Fourth Turning

 

 

 

EMPIRE

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Posted on 2nd April 2012 by Administrator in Economy |Politics |Social Issues

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 The decline and fall of the American empire

An Aging, Bankrupt Empire

by Doug French

The U.S. government has created borders within the country’s borders at every airport in the country. Technologies abound in ticketing and check-in on one side of the border while commerce thrives on the other. In between is a massive government apparatus requiring that shoes be kicked off, laptops be unpacked, and less than 3.1 ounces of liquid be carried in any one container. The only technology in sight is the offensive porno scanners. And for those that refuse scanning, a brutish pat-down is administered.

These Transportation Security Agency (TSA) borders are guarded by 58,401 bureaucrats in blue, at a cost this year of $8.1 billion. The taxpayers must not spare any expense in convincing themselves that the government is making us safe.

The arbitrariness of rules at borders is brought to mind in the opening pages of Charles Goyette’s sobering new book Red and Blue and Broke All Over: Restoring America’s Free Economy. Viewing borders from the air, one can hardly tell where they are, these imaginary lines drawn by governments. However, while the terrain on either side of a border may be identical, satellite imagining provides a stark contrast of neighboring countries where capitalism operates on one side of a border while socialism reigns on the other.

The native culture and language may be identical, but roads that are paved on the capitalist side, turn to dirt on the socialist side. While lights burn brightly in the capitalist night, those living under socialism are shrouded in darkness.

Within its borders, America once provided an example to the world of what free markets and sound money can provide. But as Goyette painstaking points out, those days are over. Today’s America is but an aging bankrupt empire. Not so different than the last days of Rome. Its armies spread thin throughout the world. Its treasure wasted long ago, government finances are in shambles, and it can only pay its promises with money it creates from nowhere.

While Republicans and Democrats bicker on Capitol Hill, each party is equally to blame. The various cable news networks root for one side or the other without realizing “that both parties worship in the same statist church and share obedience to the same economic priesthood.”

In Red and Blue and Broke All Over, Goyette writes in the same dry and witty style that made his previous book, The Dollar Meltdown, a bestseller.

In the book’s first of three parts, the author examines the state of freedom in America. It’s not a pretty picture. Once upon a time, America had no income tax, no federal reserve, no endless list of regulatory agencies, and no involvement in foreign wars.

Now we have all of that and much, much more. The average American doesn’t know what a free market looks like. “Keep the Government out of my Medicare!” read signs at 2010 Tea Party rallies. While Americans collectively spend 6.6 to 7.5 billion unpaid hours a year complying with the taxman, the government sends out 88 million checks each month. Forty-six million Americans depend on taxpayers to buy their groceries.

We hear plenty about the glories of the U.S. Constitution this campaign season, always to great cheers from hopped-up campaign workers. But the millions of square feet of Washington D.C. office space aren’t needed because congress is following that sacred document, but just the opposite.

Red and Blue’s Rothbardian author sees the state for what it is – the enemy of prosperity. Those on Capitol Hill honestly believe they can centrally plan our economy, at the same time lawmakers like Rep. John Conyers can’t figure out why the Senate Hair Care Services (Senate barber shop) requires $300,000 in taxpayer subsidy to keep open, while the privately-owned House barber shop turns a profit and offers its members cheaper haircuts.

Goyette has the guts to use the F-word while describing the U.S. economic system – fascism. Most wavers of the red, white and blue can’t bring themselves to understand that capitalism isn’t what’s operating in America. The author looks to John T. Flynn’s As We Go Marching to describe an American economy with business carried out by private owners but under the direction of government.

What spews forth from this sort of system is the Goldman Sachs to Treasury Department pipeline that Goyette terms “The Wormhole Express.” Anyone who questions how Goldman is so blatantly propped up and bailed out, must only see how many of the firm’s alumni are working in government.

An especially interesting part of Red and Blue is the author’s look at The Brothers Karamazov, Brave New World, and 1984 and the modern manifestations of the literary archetypes created by those three authors. Goyette shows that life has certainly imitated art.

Goyette quotes investment legend Jim Rogers. “There is nothing like crossing outlaying borders for gaining insight into a country.” And while Rogers was writing about third world countries in Adventure Capitalist, Americans should travel overseas and notice how easy entry into many countries is, compared to America.
From landing to calling a cab takes no time most everywhere – except the land of the free and home of the brave. Visitors to America are fingerprinted and digitally photographed on the way in. U.S. Immigration and Customs is an ordeal that takes a couple hours if everything goes right. And the process will get more cumbersome. According to the Department of Homeland Security, “At a date to be announced in the future, all travelers who provide biometrics when entering the United States will be required to provide biometrics when departing the United States.”

What has kept the American empire in operation has been the dollar’s reserve currency status. Once backed by gold, the dollar is now but a flimsy promise. A promise taken seriously by those who remember America as it once was, not what it is today.

America is bankrupt, Social Security is a Ponzi scheme and the country’s financial situation worsens each day. The author points out that the Federal Reserve’s holdings of Treasury debt increased from $777 billion to $1.6 trillion in a year’s time. America owes more to its own central bank than it does China and Japan. This should be the very definition of a banana republic.

We use the debauched dollar because we have to by law – legal tender laws. Drug dealers, who are not quite as respectful to the authorities, would rather take bottles of Tide in trade. Foreigners will follow suit, increasingly looking for alternative currencies.

Goyette provides no political solutions in Red and Blue, but instead calls for individuals to do something quite foreign to them – embrace freedom.

“The state must just stop,” Goyette repeats. “The state must STOP.”

Doug French [send him mail] is president of the Ludwig von Mises Institute and the author of Early Speculative Bubbles & Increases in the Money Supply. He received the Murray N. Rothbard Award from the Center for Libertarian Studies. See his tribute to Murray Rothbard.



ARMED CHINESE TROOPS IN TEXAS

38 comments

Posted on 8th October 2011 by Administrator in Economy |Politics |Social Issues

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BREAD, CIRCUSES, SPENDING CUTS, UNICORNS & THE APPEARANCE OF WEALTH

98 comments

Posted on 5th August 2011 by Administrator in Economy |Politics |Social Issues

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“Already long ago, from when we sold our vote to no man, the People have abdicated our duties; for the People who once upon a time handed out military command, high civil office, legions — everything, now restrains itself and anxiously hopes for just two things: bread and circuses” - Juvenal – 100 A.D.

 

 

Juvenal makes reference to the Roman practice of providing free wheat to Roman citizens as well as costly circus games and other forms of entertainment as a means of gaining political power through populism. Roman politicians devised a plan in 140 B.C. to win the votes of the poor: giving out cheap food and entertainment, “bread and circuses”. The Roman politicians realized this would be the most effective way to rise to power and stay in power.

With the revolting display of political theater in the last few weeks, I couldn’t help but consider the parallels between the Roman Empire and the American Empire. The entire debt ceiling farce was a circus on an epic scale – The Greatest Show on Earth. The American public was treated to high wire acts of near debt experiences, Senators putting their heads into the mouths of lions, and hundreds of clowns riding tiny bikes with squeaking horns. In the end, American politicians did what they do best - pretended to solve a spending problem without cutting spending. Only in America could politicians put the country on course to increase its national debt from $14.5 trillion to $23 trillion by 2021 and declare they are cutting spending. For those that need to visualize the lies of politicians, take a gander at this chart and try to find the cuts in spending.

You have a better chance of finding a unicorn in your backyard than finding actual cuts in spending from the corrupt clowns inhabiting the halls of Congress. If you are driving your car towards a brick wall at 120 mph and you slow down to 118 mph, the ultimate result will be the same. The only way to avoid disaster is to jam on the brakes. But, the liberal and conservative politicians are both enjoying the ride fueled by millions in corporate, union, Wall Street and a thousand other special interest payoffs.  

The Roman authorities provided free wheat to the peasants as a superficial means of appeasing the masses and distracting them from the fact that public policy and public service had failed, as corruption and decadence engulfed those in control of government. Free bread, chariot races, and feeding Christians to lions kept the small-minded peasants satiated and ignorant of their civic duty. Today, the authorities don’t hand out bread they hand out EBT cards to 45.5 million Americans, or 14.6% of the entire population.

There are almost 5 million Americans on welfare. There are 50 million Americans on Medicaid. There are 8 million Americans receiving unemployment compensation. There are 10.5 million Americans on Social Security disability. This is the symbolic bread being provided to the masses to keep them tranquilized, pliable, satisfied and ignorant of their civic duty. The government has renamed bread as “social benefits” and now distributes $2.3 trillion of bread per year to the ”needy”. This constitutes 15% of the country’s GDP and will continue to grow for decades or until the American Empire collapses.

Aldous Huxley in his 1958 assessment of his 1931 novel Brave New World - Brave New World Revisited said that “any bird that has learned how to grub up a good living without being compelled to use its wings will soon renounce the privilege of flight and remain forever grounded. If the bread is supplied regularly and copiously three times a day, many of them will be perfectly content to live by bread alone – or at least by bread and circuses alone. ‘In the end,’ says the Grand Inquisitor in Dostoevsky’s parable, ‘in the end they will lay their freedom at your feet and say to us, make us your slaves, but feed us.” Bread is not the opiate of the masses, it is the cyanide. Huxley saw the Welfare state arising before it really got kick started in the late 1960s. By trying to support the less fortunate by transferring trillions to them, with no strings attached, we have insured the ultimate bankruptcy of our country. Americans have willingly sacrificed liberty, freedom and civic responsibility for safety, security and bread.

Huxley hadn’t lost all hope. He seems to have foreseen the rise of the Tea Party and the coming revolution, led by the youth of this country who are being left with the bill for the bread and circuses promised by myopic politicians over the last four decades:

“When things go badly, and the rations are reduced, the grounded do-dos will clamor again for their wings… The young people who now think so poorly of democracy may grow up to be fighters for freedom. The cry of ‘Give me television and hamburgers, but don’t bother me with the responsibilities of liberty,’ may give place, under altered circumstances to the cry of Give me liberty or give me death.”

I hope Huxley is right. The welfare state is bankrupt. The rations are going to be cut. There is no choice. The money is gone. The jobs are gone. The do-do’s that haven’t flown in years are unlikely to clamor for their wings. They are already clamoring when even the potential of cuts in their bird feed are mentioned. The Millenial generation is our last great hope to reverse our decline. They have not become addicted to “social benefits” yet. Their parents and grandparents are handing them an un-payable bill as they graduate college with no jobs. A generational war is in the offing. I for one will side with the youth against the Boomers. The future of the country depends upon the outcome of this war.

Striking Similarities to Rome

“There are striking similarities between America’s current situation and the factors that brought down Rome, including declining moral values and political civility at home, an over-confident and over-extended military in foreign lands and fiscal irresponsibility by the central government”. -David Walker

 

David Walker, the former head of the GAO from 1998 until 2008, compared the U.S. Empire to the Roman Empire in August 2007. He has been warning the country about our unsustainable fiscal path for over a decade.

  • Since August 2007 the National Debt has increased from $8.9 trillion to $14.6 trillion, a 64% increase in four years.
  • We’ve increased our cumulative expenditure on our wars of choice in the Middle East to $1.3 trillion since 2001.
  • Our annual military spending rose from $653 billion in 2007 to the current $966 billion, a 48% increase in four years.
  • Federal government transfers for Social Security, Medicare, Medicaid, Unemployment, Veterans, Food Stamps, and Welfare increased from $1.7 trillion in 2007 to the current level of $2.3 trillion, a 35% increase in four years.

It goes without saying that Mr. Walker’s advice was not heeded. And regarding declining moral values and political civility, I would point you to the fine examples of morality displayed by Wall Street since 2007 along with the display of civility seen in Washington DC over the last few weeks. The striking similarities that David Walker acknowledged are in full bloom for the world to see.

English historian Edward Gibbon wrote his masterpiece The Decline and Fall of the Roman Empire in 1776, ironically in the year the American Empire was born. He detailed the societal collapse encompassing both the gradual disintegration of the political, economic, military, and other social institutions of Rome and the barbarian invasions that were its final doom in Western Europe. Gibbon concluded there were five marks of the Roman decaying culture:

  1. Concern with displaying affluence instead of building wealth.
  2. Obsession with sex and perversions of sex.
  3. Art becomes freakish and sensationalistic instead of creative and original.
  4. Widening disparity between very rich and very poor.
  5. Increased demand to live off the state

Gibbon’s analysis captured the essence of what happens to all empires. It subsequently happened to the Dutch, Spanish and British empires and has been eating away at the greatest empire of all over the last several decades. Larry Elliot, writer for the UK Guardian, recently described the rot that has destroyed every empire in history:

“The experience of both Rome and Britain suggests that it is hard to stop the rot once it has set in, so here are the a few of the warning signs of trouble ahead: military overstretch, a widening gulf between rich and poor, a hollowed-out economy, citizens using debt to live beyond their means, and once-effective policies no longer working. The high levels of violent crime, epidemic of obesity, addiction to pornography and excessive use of energy may be telling us something: the US is in an advanced state of cultural decadence.

Empires decline for many different reasons but certain factors recur. There is an initial reluctance to admit that there is much to fret about, and there is the arrival of a challenger (or several challengers) to the settled international order. In Spain’s case, the rival was Britain. In Britain’s case, it was America. In America’s case, the threat comes from China.”

For the last forty years America has shifted from a society that created goods into a society that created debt. Displays of affluence like McMansions, Mercedes, BMWs, Rolexes, summer mansions in the Hamptons, designer clothes, granite and stainless steel kitchens, and 85 inch HDTVs, all purchased with debt provided like candy by the Wall Street banks and their sugar daddy – the Federal Reserve, have trumped true wealth building. The result is a nation with $52.6 trillion of debt outstanding, or 350% of GDP. The basic rule for maintaining a healthy economic system requires the population to spend less than they earn and save the difference. The savings can then be invested in domestic companies, plants and equipment which keep the country growing. Americans bought into the lie that purchasing cheap foreign goods with cheap credit was as valid as actually building wealth. The national savings rate, which exceeded 10% in the 1970s and early 1980s, dropped to less than 1% by 2005. Why save when you could whip out one of your 13 credit cards.

America’s obsession with sex and perversion of sex makes Caligula look like a Boy Scout. There are 4.2 million pornographic websites serving 72 million visitors per month and generating $5 billion of revenue for these fine capitalists. More than 40% of internet users view porn. What passes for art today is a crucifix in the artist’s urine. The true art of the American empire consists of reality TV shows like Jersey Shore and Housewives of NY, OC, NJ, Miami, and Atlanta. America has taken shallow, mindless, and superficial to an empire crushing low.

The disparity in wealth between the super rich and the working class has never been greater. The working middle class that built this country has been systematically destroyed as the super rich have used inflation and debt to lure them into servitude, while the unproductive parasites have learned it is easier to feed off their middle class host than work for a living. It is clear to anyone, except a Republican ideologue, that when the top 10% richest Americans abscond with 50% of the income in the nation through their control of politicians, Wall Street and the few mega-corporations that set the economic agenda, a convulsive change is necessary. It is not a coincidence  the heyday of the American Empire was from 1946 until 1971 when the working middle class was able to advance their station in life through education, hard work and a level playing field.

The playing field got tilted against the working middle class in the late 1960′s with LBJ’s Great Society welfare state and got turned upside down in 1971 when Nixon closed the gold window and allowed bankers and politicians unfettered access to money printing with no immediate consequences. The result has been a slow steady descent into hell as politicians have made $100 trillion of unfunded promises of bread to the masses and bankers have gorged themselves with riches from peddling debt to the same masses, so they could enjoy the circuses. We are now left with the top 1% hoarding 33.8% of the wealth and the top 10% clinging to 71.5% of the wealth in the country. The bottom feeders are thrown scraps of bread in the form of food stamps, welfare, disability payments, and unemployment compensation. They have grown dependent and no longer participate in productive society. With more than 50% of adults paying no income tax, they vote for politicians that promise to not “cut” their social benefits.  

 

When you see your leaders take actions that clearly are not in the long term best interests of the American people, you need to ask why. Since September 2008 your leaders have funneled trillions of dollars to the Wall Street bankers that nearly destroyed the worldwide economic system. They have funneled billions into the coffers of the mega-corporations that outsourced your jobs to Asia. They ramped up their wars in the Middle East to reward their friends in the military industrial complex. And lastly, they handed out a few hundred billion more to the masses to keep them from rioting in the streets.

We know for a fact QE2 was designed to prop up the stock market because Ben Bernanke told us so. And it worked. From the day he announced he was going to do it at the annual meeting of the ruling moneyed classes at Jackson Hole until it ended on July 1, 2011, the market went up 30%. The average American dealt with the 30% to 50% increases in food and energy costs, while the richest 1% partied like it was 1999. Considering they own 50.9% of all the stocks in the country, the last couple years of free money and stock appreciation created by the Federal Reserve have been a windfall for the privileged moneyed class. The bottom 50% who own 0.5% of the stocks in the country haven’t fared so well. 

When you watch the talking heads and contemptible pundits on Fox, CNBC, MSNBC, CNN and the other mainstream corporate media spinning our economic situation in a positive way, remember that every person you are listening to is a member of the top 1% richest Americans. They have large portfolios of stocks and will not let reality or truth interfere with their ambitions of further wealth and power. This country is controlled by the few for the benefit of the few at the expense of the many. Less than ten banks control more than 50% of deposits and 75% of the lending in the country. One private banking organization – the Federal Reserve – controls the currency of the country. A handful of mega-corporations control the commerce of the country. Less than ten arms dealers dictate the war spending in the country. A few media conglomerates control the message fed to the masses. A few hundred corrupt politicians pay off their corporate and banking masters with laws, tax breaks, and pork. These people make up the ruling class of America.

As their messages of “efficiency” and “job creation” have proven to be lies, the financialization of America by the ruling class is almost complete. Real earnings for real people are 10% lower than they were in 1972. They have transformed a productive society based on saving and investment into a hollowed out shell of a society based on financial manipulation and debt. The endgame approaches.

The moneyed interests have gone too far. The debts are too large. The burden placed on the middle class is too great. The Federal Reserve has proven to be the lackeys of the Wall Street fat cats and the slithering political class in Washington DC. QE2 was a miserable failure. The American middle class is angry. Their anger could lash out in many possible directions. Their benefits will be cut. Their home values will fall. Their 401ks will be cut in half. Their standard of living will fall. Will they accept this fate without a fight? I doubt it.

Democracy Never Lasts Long 

The decline of the American Empire may be a surprise to those who cling to the laughable American Exceptionalism dogma, but every previous empire in history has declined. The Dutch Empire lasted for just over a century. The Spanish Empire survived for just over two centuries. The British Empire reigned for just over three centuries. And the Great Roman Empire ruled for almost five centuries.

The American Empire has been expanding for over 220 years, but based on all indications has peaked. Were we destined to implode as all previous democracies have done, as described by Greek historian Polybius?

“Monarchy first changes into its vicious allied form, tyranny; and next, the abolishment of both gives birth to aristocracy. Aristocracy by its very nature degenerates into oligarchy; and when the commons inflamed by anger take vengeance on this government for its unjust rule, democracy comes into being; and in due course the licence and lawlessness of this form of government produces mob-rule to complete the series.” -The Histories 6.4.7-13

As a democracy this country was supposed to be governed by the people, for the people. We were supposed to have an equal say in how we were governed and participation in adopting the laws of the land. Over time civic duty was outsourced to politicians that promised the masses safety and security at the expense of liberty and responsibility. The general population has grown accustom to the bread and circuses provided by their “protectors”. The fledgling democracy has degenerated into a corporate fascist oligopoly that benefits the few in control. Recent events prove beyond a shadow of doubt the privileged few are losing control of the situation. A worldwide upheaval is brewing as the toxic debt is strangling the economic systems of the world. Confidence in this ponzi finance system is waning. The American population is beginning to realize their fatal mistake in trusting bankers and politicians to do what was right for the country.

Polybius believed that democracies always killed themselves:

“And hence when by their foolish thirst for reputation they have created among the masses an appetite for gifts and the habit of receiving them, democracy in its turn is abolished and changes into a rule of force and violence. For the people, having grown accustomed to feed at the expense of others and to depend for their livelihood on the property of others, as soon as they find a leader who is enterprising but is excluded from the houses of office by his penury, institute the rule of violence; and now uniting their forces massacre, banish, and plunder, until they degenerate again into perfect savages and find once more a master and monarch.” - The Histories 6.9.7-9

The average American does not understand what is swirling around them. They have a sense of unease, but they are still receiving their government issued bread and their 52 inch TV is providing 24 hours of circuses. The monetary system upon which that bread and those circuses are based is collapsing as we speak. Ernest Hemingway captures what is happening to the American Empire in one brief quote from his novel The Sun Also Rises:

“How did you go bankrupt?” “Two ways, gradually and then suddenly”

As the political theater of the absurd played out last week in Washington DC, it became clear to me the ruling class has no intention of changing our path. Politicians will keep spending and central bankers will keep printing more money. There are people like David Walker that will continue to sound the alarm:

“We are less than three years away from where Greece had its debt crisis as to where they were from debt to GDP. With the recent increase in the debt ceiling and continued higher budget deficits at the federal level, the US is on course for its own crisis. We are not exempt from a debt crisis. We’re never going to default, because we can print money. At the same point in time, we have serious interest rate risk, we have serious currency risk, we have serious inflation risk over time. If it happens, it will be sudden and it will be very painful.”

But, it appears we are destined to commit suicide as a nation. I doubt the American Empire will linger on for centuries. The world moves rapidly. The Vandals (Goldman Sachs) and the Huns (JP Morgan) are at the gates. The final battle is underway – the battle for the soul of America. When the existing social structure is swept away by the tsunami of un-payable debt, who and what will replace it? Will the American people turn to someone that promises them liberty and freedom with no promises of bread and circuses? Or will they turn to a strong demagogue that promises them more safety and more security?

What do you think?

“Democracy never lasts long. It soon wastes, exhausts and murders itself. There was never a democracy that did not commit suicide.”  – John Adams, Letter, April 15, 1814
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