Tag: Aldous Huxley

EIGHT HUNDRED MILLION F@#KING DOLLARS IN 24 HOURS

I’m flabbergasted on a daily basis by the idiocy that goes on in this country. We have the lowest percentage of people working since 1978. We have 47 million people, or 20% of all households, on food stamps. The real median household income is lower than it was in 1998. Gas prices are near all-time highs. The average family has virtually no retirement or current savings. Despite these facts, millions of broke Americans lined up to buy a freaking video game to the tune of $800 million in the first 24 hours on the market. They just whipped out the credit card and went $60 further into debt. I’m sure some people enjoy video games. Personally, I have never played a video game in my entire life. I’ve spent hundreds of dollars on games for my kids, but never played one of them. Of course, I’ve never sent a text message in my life either, so I may not be the ideal judge of technology.

I see this phenomenon as part of the bigger picture of a world ruled by propaganda, distraction, chosen servitude and willful ignorance. The corporate fascist ruling class know they must keep the masses distracted from the true reality of their situation. Video games, sporting events, 24 hour faux news entertainment, reality TV, porn, the stock market, religion, evil dictators, iGadgets, fashion magazines, and most of the internet are just opium for the masses.  

Our Controllers have succeeded in implementing every dystopian idea dreamed up by Aldous Huxley and detailed in his classic 1932 novel – Brave New World. Huxley’s fears have been realized to a greater extent than he could have imagined:

“In regard to propaganda the early advocates of universal literacy and a free press envisaged only two possibilities: the propaganda might be true, or the propaganda might be false. They did not foresee what in fact has happened, above all in our Western capitalist democracies – the development of a vast mass communications industry, concerned in the main neither with the true nor the false, but with the unreal, the more or less totally irrelevant. In a word, they failed to take into account  man’s almost infinite appetite for distractions.

In the past most people never got a chance of fully satisfying this appetite. They might long for distractions, but the distractions were not provided. Christmas came but once a year, feasts were “solemn and rare,” there were few readers and very little to read, and the nearest approach to a neighborhood movie theater  was the parish church, where the performances though frequent, were somewhat monotonous. For conditions even remotely comparable to those now prevailing we must return to imperial Rome, where the populace was kept in good humor by frequent, gratuitous doses of many kinds of entertainment – from poetical dramas to gladiatorial fights, from recitations of Virgil to all-out boxing, from concerts to military reviews and public executions. But even in Rome there was nothing like the non-stop distractions now provided by newspapers and magazines, by radio, television and the cinema.

In “Brave New World” non-stop distractions of the most fascinating nature are deliberately used as instruments of policy, for the purpose of preventing people from paying too much attention to the realities of the social and political situation. The other world of religion is different from the other world of entertainment; but they resemble one another in being most decidedly “not of this world.” Both are distractions and, if lived in too continuously, both can become, in Marx’s  phrase “the opium of the people” and so a threat to freedom.

Only the vigilant can maintain their liberties, and only those who are constantly and intelligently on the spot can hope to govern themselves effectively by democratic procedures. A society, most of whose members spend a great part of their time, not on the spot, not here and now and in their calculable future, but somewhere else, in the irrelevant other worlds of sport and soap opera, of mythology and metaphysical fantasy, will find it hard to resist the encroachments of those would manipulate and control it.” 
―    Aldous Huxley,    Brave New World Revisited

The ignorant masses that make up the majority in this country have learned to love their servitude. We threw in the towel on vigilance and love of liberty decades ago. While millions sit in front of their boob tubes killing whores and stealing cars with their joy stick in their fantasy worlds, our Controllers are smiling as they manipulate, obfuscate, and increase their wealth, power and control. Welcome to Brave New World USA.

 

‘Grand Theft Auto’ Sets $800 Million, One-Day Record

Surpassed Record Set by ‘Call of Duty: Black Ops II’ Last November

 

TRYING TO STAY SANE IN AN INSANE WORLD – PART 2

In Part 1 of this article I detailed the insane solutions proposed and executed since 2008 by our owners as they attempt to retain and further expand their ill-gotten wealth, acquired through fraud, deceit, swindles, and the brilliant manipulation and exploitation of the masses through Bernaysian propaganda techniques. Madness has engulfed the entire world, with a concentration of power in the hands of a few psychopathic financial elite wielding an inordinate and dangerous expanse of power over the lives of the common man. They are a modern day version of Al Capone, except their weapons of choice aren’t machine guns, but a printing press, peddling debt, creating derivatives of mass destruction, and peddling heaping doses of disinformation. The contemporary criminal class wears Hermes suits, Rolex watches and diamond studded pinky rings, drops $500 to dine at Masa in NYC, travels by chauffeured limo, lives in $10 million NYC penthouse suites, occupies luxurious corner offices in hundred story glass towers, and spends weekends hobnobbing with the other financial elite at their villas in the Hamptons. They have nothing but utter contempt for the lowly peasants who depend upon a weekly paycheck to make ends meet. Why work when you can steal $1 or $2 billion from farmers with no consequences?

  

The willfully ignorant masses are kept at bay by the selling them a false dichotomy of Republicans versus Democrats, conservatives versus liberals, and capitalism versus socialism. The ruling class distracts the public with fake wars on poverty, drugs and terror, while using these storylines to further enrich themselves and keep the public alarmed and frightened. We’ve been “fighting” the wars on poverty and drugs for over four decades and poverty is at record levels, while drugs are easier to obtain than candy in a candy store. The war on terror is nothing more than a corporate arms dealer welfare plan. The end of the Cold War put a real crimp in the bottom lines of Lockheed Martin and the rest of the peddlers of death. 9/11 and the subsequent undeclared wars in Iraq, Afghanistan, Libya and now Syria, with Iran on the horizon, have been a godsend to the bottom lines of the corporations Eisenhower warned about in 1961. In reality, the politicians are interchangeable and bought off by corporate and special interests. The people are sold a fable, and controlled opposition is the fairy tale. They perpetuate the welfare/warfare state that enriches Wall Street, the military industrial complex, the healthcare service complex, politically connected mega-corporations and the corporate media propaganda complex. The American people are given the illusion of choice by their keepers. The system is rigged. The real decisions are made by unelected secretive men who operate in the shadows and use their wealth to direct the decision making of the politicians, government bureaucrats, and corporate entities that benefit from those decisions. Edward Bernays described a society that existed in the 19th Century, 20th Century, and has now grown to immense proportions in the 21st Century:

“Political campaigns today are all sideshows…A presidential candidate may be ‘drafted’ in response to ‘overwhelming popular demand,’ but it is well known that his name may be decided upon by half a dozen men sitting around a table in a hotel room…The conscious manipulation of the masses is an important element in democratic society. Those who manipulate this unseen mechanism of society constitute an invisible government which is the true ruling power of our country.” – Edward Bernays 

The manipulation of the masses has been perfected by the ruling class through decades of corporate mass media messaging the purposeful dumbing down of the populace through government public school education that teaches children how to feel rather than how to think. The conscious manipulation of the masses has been designed to produce obedient non-thinking consumers of corporate products, educated to believe the accumulation of material goods with debt constitutes wealth, to fear whatever the government tells them to fear, and never look up from their iGadgets long enough to actually think for themselves. We are bombarded with Orwellian memes designed to keep us sedated and pliant, as the ruling class pillages the national wealth and expands their power and control over our lives.

Conform; Stay Asleep; Do Not Question Authority; Obey; Consume; Reproduce; Submit; Watch TV; Buy; Follow; Doubt Humanity; No New Ideas; Feel, Don’t Think; Fear; Accumulate; Honor Apathy; Believe Experts; Surrender; Spend; No Independent Thought; Win; Want More; Hate; Succumb To Desire; Yield To Power; Choose Safety Over Liberty; Choose Security Over Freedom   

This insane world was created through decades of bad decisions, believing in false prophets, choosing current consumption over sustainable long-term savings based growth, electing corruptible men who promised voters entitlements that were mathematically impossible to deliver, the disintegration of a sense of civic and community obligation and a gradual degradation of the national intelligence and character.

Are You Sane?

“A sane person to an insane society must appear insane.” – Kurt Vonnegut – Welcome to the Monkey House

Vonnegut and Huxley’s social commentary reveals a basic truth that societies and human beings have been prone to bouts of madness over the course of decades and centuries. Humans are a weak species, susceptible to the vagaries of greed, lust, gluttony, wrath, sloth, envy and pride. The seven deadly sins are in full bloom today, as the American empire descends through Dante’s inferno of reality TV, celebrity worship, religious zealotry, adulation of wealthy titans, military conquest and worship of false idols. Over the centuries humans have gone mad over tulips, farm land, stocks, and real estate. The easily duped American populace has been victimized by multiple bubbles bursting since the creation of the Federal Reserve in 1913. The contention that a central bank run by private banking interests would promote a safer financial system and a stable currency is laughable. The Federal Reserve and the bankers who control it have created three stock bubbles, the largest housing bubble in history, a bond bubble and the mother of all debt bubbles, while destroying 95% of the dollar’s purchasing power in the last 100 years.

There is a common denominator in all the bubbles created over the last century – Wall Street bankers and their puppets at the Federal Reserve. Fractional reserve banking, control of a fiat currency by a privately owned central bank, and an economy dependent upon ever increasing levels of debt are nothing more than ingredients of a Ponzi scheme that will ultimately implode and destroy the worldwide financial system. Since 1913 we have been enduring the largest fraud and embezzlement scheme in world history, but the law of diminishing returns is revealing the plot and illuminating the culprits. Bernanke and his cronies have proven themselves to be highly educated one trick pony protectors of the status quo.

Greenspan’s easy money policies, manufacturing of negative real short term interest rates, regulatory malfeasance and unspoken promise to bail out Wall Street whenever their excessive risk taking threatened to burn down the financial system, led to 50% stock market crash in 2000/2001, a 40% plunge in national home prices, and another 55% stock market crash in 2008/2009. While Ivy Leaguers Bernanke, Paulson, Hubbard, Krugman, and Bush were too obtuse or too blinded by their ideology to recognize the fraudulent housing and stock market bubbles, honest clear thinking men like Robert Shiller, John Hussman, and Ron Paul recognized the bubbles well in advance and understood the consequences to the average American.

“Like all artificially-created bubbles, the boom in housing prices cannot last forever. When housing prices fall, homeowners will experience difficulty as their equity is wiped out. Furthermore, the holders of the mortgage debt will also have a loss.” – Ron Paul – 2003

What Ron didn’t realize was the peddlers and packagers of fraudulent mortgage debt on Wall Street would walk away unscathed when the bubble they created popped. Trillions of net worth was vaporized due to the policies, solutions, and programs designed and implemented by Bernanke and his Wall Street co-conspirators. The losses should have been borne by those who made the loans. Instead they were borne by the American taxpayer and future unborn generations. David Stockman, in his no holds barred book about the Wall Street and K Street crony capitalist criminals, rails against the Federal Reserve led rescue of the profligate destroyers of capital markets:

“At the end of the day, this trillion-dollar infusion of capital and liquidity from the public till had a single overarching effect: it nullified in its entirety the impact of Mr. Market’s withdrawal of a similar magnitude of funding from the wholesale money market. So the very monetary distortion – the availability of cheap overnight funding in massive quantities – upon which the Wall Street financial bubble had been built had now been recreated at the lending windows of the Fed, FDIC, and the US Treasury.

The opposite path of liquidating the Wall Street bubble was eschewed, of course, not only because it would have meant massive losses to speculators in the stock and bonds of Goldman Sachs, Morgan Stanley, JP Morgan, and the remaining phalanx of the walking wounded. Crony capitalism also triumphed because in muscling the system during the white heat of crisis, Wall Street had plenty of intellectual cover. The fact is, mainstream economists of both parties were trapped in a Keynesian dead end, proclaiming that the solution to the crushing national debt load which had actually triggered the financial crisis was to pile on more of the same.

Accordingly, banks which were “too big to fail” couldn’t be busted up, since they were allegedly needed to shovel more credit onto already debt saturated household and business balance sheets. Likewise, speculators who should have suffered epochal losses during the meltdown were resuscitated by Fed-engineered zero interest rates in the money market, thereby quickly reviving the same massively leveraged “carry trades” in commodities, currencies, equities, derivatives, and other risk assets which had brought on the crisis in the first place.” – David Stockman – The Great Deformation – The Corruption of Capitalism in America

The working middle class was forced at gunpoint to bail out billionaire bankers who had been fraudulently inducing feeble minded dupes and trailer trash to purchase $500,000 McMansions with negative amortization no doc subprime mortgages, while bullying appraisers into inflating appraisals, buying off the rating agencies, selling the toxic derivatives to their clients, and then shorting the very same derivatives. They subsequently committed foreclosure fraud by robo-signing legal documents. Describing these modern day Shylocks as heartless, cruel, lecherous, avaricious demons understates the vileness and contemptibility of their nature. Ben Bernanke and Hank Paulson blatantly lied to the depraved, gutless members of Congress and to the easily hoodwinked fearful American public about the threat of our financial system collapsing unless the Wall Street banks were saved. This false storyline is still peddled today and believed by millions of willfully ignorant crony capitalist devotees. The financial system wasn’t going to collapse. The stock prices of JP Morgan, Goldman Sachs, Citigroup, Bank of America, AIG, Morgan Stanley, GE, and Wells Fargo were collapsing. The wealth of the financial elites that run the country was in peril. The depositors in these banks wouldn’t have lost a penny, but the shareholders and bond holders would have been wiped out. The personal wealth of Dimon, Mack, Lewis, Prince, Immelt, Blankfein and the other titans of finance took precedence over the rule of law and the negative consequences of excessive risk taking and control fraud.

True free market capitalism embraces the concept of creative destruction. Poorly run companies fail and are replaced by well-run companies. Bankruptcy law worked perfectly during the liquidation of Washington Mutual. The orderly liquidation of the Too Big to Trust Wall Street banks would have resulted in billions of bad debt being discharged, with the losses being borne by the executives who mismanaged the banks and the investors who were foolish enough to fund the disastrous schemes perpetrated by those executives. The FDIC would have kept depositors whole. The privatization of illicit bank profits from 2002 through 2007 and the socialization of the 2008 through 2010 bank losses are proof that we are experiencing a warped, immoral, crony capitalism that enriches the well-connected and impoverishes the working middle class. Our political, economic and financial systems have been captured by corporate and special interests. This corruption will prove fatal, as the vested interests destroy the system through their myopic greed. We’ve allowed a small cadre of malevolent men to gamble away the nation’s future with impunity from all laws, regulations and any sense of morality, under the guise of capitalism. These men and the nation will pay a high price for these transgressions. The punishment will fit the crimes.

“People of privilege will always risk their complete destruction rather than surrender any material part of their advantage.” – John Kenneth Galbraith – The Age of Uncertainty

The chart below reveals the criminal plan as implemented by Bernanke, the Obama administration and the Wall Street banks. Instead of allowing insolvent financial institutions to fail, $700 billion of taxpayer funds were syphoned from the economy and handed to them. Bernanke has since stuffed their coffers with another $2.4 trillion he printed out of thin air. The purpose of this insane transfer of national wealth from the people to the parasites was not to help Main Street. Forcing the FASB to allow these criminal bankers to mark to unicorn rather than mark to market, buying their toxic mortgages, and providing billions in free money was done to cover-up the fact they are insolvent. Their balance sheets and the Federal Reserve balance sheet are choking on bad debt. The ongoing foreclosure/rent to own scam was designed to drive up home prices and allow the bankers to exit their toxic mortgages with a profit. The criminally insane bankers have used the trillions in excess funds to syphon off billions in stock market gains, with assurances from Ben that QE to infinity will always be there. They know if their gambling leads to losses, Ben will come to the rescue.

The purpose of banks was supposed to be to lend money to businesses and consumers so they could make long-term investments that helped expand the economy. These Wall Street cretins didn’t loan money to people and businesses in the real world. It was much easier to generate risk free returns and program their HFT supercomputers to buy, buy, buy. By driving real interest rates below zero for the last four years, Bernanke has stolen $400 billion per year from senior citizens living on the edge and transferred it to bloodsucking bankers. Anyone with money in a bank account is losing money. This was designed to force muppets back into the stock market where they will be fleeced for the third time in the last thirteen years.

inflation and t-bill

Bernanke’s rescue measures have been a smashing success for the .1%. Wall Street is generating record levels of profits and paying out record levels of bonuses to themselves for a job well done. The stock market is at an all-time high, while the middle class is eviscerated by relentless inflation in energy, food, healthcare, clothing, tuition, rent and taxes. Reality does not match the propaganda touted by the financial elite. Ask the 47.7 million people on food stamps.

food stamps

The economic recovery narrative propagated by Wall Street paid economists, Wall Street controlled media pundits, and Wall Street bought off politicians is nothing but unmitigated bullshit. True unemployment, that doesn’t falsely exclude the unemployed who have thrown in the towel, is north of 20%, with youth unemployment exceeding 40%. The “solutions” implemented by our owners have led to a 10% collapse in the median household income since 2008. If the middle class is seeing their real incomes decline, while their living expenses are rising by 5% per year, how can the economy be recovering? It can’t. Bernanke’s banker welfare program and Obama’s $1 trillion deficits, along with accounting fraud and under-reporting of inflation, have produced the illusion of recovery.

economix-28income-blog480

Dimitri Orlov summarizes our modern financial system and sets the table for the coming collapse:

“The main tools of modern finance are mystification, obfuscation and hypnosis. What is different now is that all the governments have already shot all of their magic bailout bullets. The guilty parties are still at large, richer than they were before this crisis and probably thinking that the next crisis will make them even richer.” – Dimitri Orlov – The Five Stages of Collapse

The questions that must be answered are: How did we allow this to happen? Are we blameless? Can our course be reversed?

Time to Look in the Mirror

“The America of my time line is a laboratory example of what can happen to democracies, what has eventually happened to all perfect democracies throughout all histories.  A perfect democracy, a ‘warm body’ democracy in which every adult may vote and all votes count equally, has no internal feedback for self-correction.  It depends solely on the wisdom and self-restraint of citizens… which is opposed by the folly and lack of self-restraint of other citizens.  What is supposed to happen in a democracy is that each sovereign citizen will always vote in the public interest for the safety and welfare of all.  But what does happen is that he votes his own self-interest as he sees it… which for the majority translates as ‘Bread and Circuses.’

‘Bread and Circuses’ is the cancer of democracy, the fatal disease for which there is no cure.  Democracy often works beautifully at first.  But once a state extends the franchise to every warm body, be he producer or parasite, that day marks the beginning of the end of the state.  For when the plebs discover that they can vote themselves bread and circuses without limit and that the productive members of the body politic cannot stop them, they will do so, until the state bleeds to death, or in its weakened condition the state succumbs to an invader—the barbarians enter Rome.” –  Robert A. Heinlein

Robert Heinlein has been dead for twenty five years. He wrote these words decades ago. His vision of a state bleeding to death is being played out as we speak. Ben Franklin had an inkling the Republic we were given would not be sustained. The success of our nation hinged upon the wisdom, self-restraint, morality, and civic mindedness of its citizens. Our form of governance was never perfect. Nothing is perfect. Adam Smith’s free market capitalism was based upon true competition, but with an underlying moral code. The rule of law meant something. Those who stole, cheated or broke the law were punished. Bankers and their usurious machinations were frowned upon. They were tolerated as a necessary evil, but they certainly weren’t admired and celebrated. When their greedy schemes to loot the populace went too far, a courageous leader would step forth and rout out the vipers and thieves:

“You are a den of vipers and thieves. I intend to rout you out, and by the eternal God, I will rout you out.” – Andrew Jackson

Bankers gained more power after the Civil War as oil was discovered, the country grew rapidly, and the robber barons built their fortunes on debt and the backs of the poor. But still, there were leaders like Teddy Roosevelt who stood up to the banking and corporate interests. The die was finally cast in 1913 with the introduction of the income tax, the creation of the Federal Reserve and allowing the people to directly elect their Senators. A century of central banking has led to: a century of war; a century of currency debasement; a transformation from a hard-working, saving, producing society into an irresponsible, debt based spending, consuming society; and the degradation of our society into a mob of egotistical techno-narcissists, who have chosen bread and circuses over freedom, liberty and self-reliance. At first it happened gradually, but accelerated rapidly once Nixon removed the last vestiges of control over greedy bankers, corrupt politicians, and gluttonous voters. The transformation from an industrious nation of savers into a slothful nation of consumers has reached its zenith. Financialization Nation has been built on a pyramid of debt. The youth of today have been left with an un-payable debt burden and as Bill Bonner points out, the endgame will likely be violent and bloody:

“That’s a heavy burden. It is especially disagreeable when someone else ran up the debt. Then you are a debt slave. That is the situation of young people today. They must face their parents’ debt. Even serfs in the Dark Ages had it better. They had to work only one day out of 10 for their lords and masters. As it stands, young people in the U.S., Europe and Japan are expected to work their whole lives to pay for things their parents and grandparents consumed decades earlier.

Let’s see. Deny a young person work and you deny him a career. Deny him a career and you deny him a way to support a family. Deny him a family life and who knows what happens? Will today’s young people accept their lot… and remain in docile debt servitude their whole lives? Or will they rise up and burn T-bonds in public spaces… rampage down Wall Street… and perhaps hang Ben Bernanke in front of the New York Federal Reserve?” – Bill Bonner

The pyramid of debt was built brick by brick over the last century, as an unelected, secretive, unaccountable cabal of private banker pharaohs has controlled the currency of the nation and worked on behalf of the vested corporate and banking interests that control the country. Shortly after its devious creation in 1913, they enabled Woodrow Wilson to wage a war he promised to keep the nation out of. The central bank’s easy money policies during the 1920s led to an unsustainable credit driven boom in stocks, bonds and real estate. As usual, their belated monetary tightening was too late to avoid the 1929 Crash. Federal Reserve and government intervention after the crash prolonged the Depression for over a decade. The Crash of 1929 proved once again that bankers could not be trusted. Their insatiable greed and reckless thirst for more and more riches required checks on their ability to destroy our economic system. The 38 page 1933 Glass-Steagall Act made sure commercial banking was kept separate from investment banking (gambling), keeping the productive activity of helping businesses grow isolated from the parasitic activity of speculation. This clear, concise, understandable law kept bankers from destroying the lives of millions for 66 years, until a bipartisan screw job repealed the law and unleashed the kraken upon the unsuspecting public. Bernanke’s QE to infinity driven stock market gains over the last few years are reminiscent of another historic time, and this story also hasn’t reached its ultimate climax.

“A major boom in real stock prices in the U.S. after ‘Black Tuesday’ brought them halfway back to 1929 levels by 1930. This was followed by a second crash, another boom from 1932 to 1937, and a third crash. Speculative bubbles do not end like a short story, novel, or play. There is no final denouement that brings all the strands of a narrative into an impressive final conclusion. In the real world, we never know when the story is over.” – Robert Shiller

The destruction of Europe, Russia and Japan during World War II and the Bretton Woods system that made the USD supreme across the world kept the economic peace for the next quarter century. A confluence of events in the late 1960s and early 1970s set the stage for the ultimate collapse of our faith based monetary system. LBJ’s Great Society welfare programs and our disastrous foray into Southeast Asia began the insane welfare/warfare dynamic that has required more and more debt to sustain. Nixon realized the debt expansion needed to pay for an ever expanding state could never be achieved with the Bretton Woods/gold pegged currency system.  In 1971 Nixon unilaterally canceled the direct convertibility of the USD to gold. It ushered in the era of freely floating currencies, relentless inflation, financial bubbles, debt accumulation, consumerism, and the rise of the corporate/fascist propaganda state. Using government supplied CPI statistics, the dollar had lost 75% of its purchasing power between 1913 and 1971. Since 1971 it has lost 83% of its remaining purchasing power. And Ben Bernanke has the guts to publicly state his worries about the ravages of deflation.

The years 1913 and 1971 will be seen by future historians as infamous dates when marking the decline of the great American empire.  Prior to 1971, the New York Stock Exchange barred the public listing of investment banks. After the exchange repealed this ban, the large investment banks (Lehman Brothers, Morgan Stanley, Merrill Lynch, Goldman Sachs, Bear Stearns) converted from partnerships, where the senior employees owned the company and were responsible for all of its liabilities, profits and losses, into publicly owned corporations, where executives’ incentives become aligned with outside shareholders, who demanded short-term profits and higher stock prices at the expense of long term sustainability. The partnership structure provided a mechanism of restraint, self-control, fiscal responsibility and cautiousness. If the bank failed, the partners’ net worth would be wiped out. Their incentives were for the long-term sustainability of the business and they were discouraged from taking undue risks that might produce huge short term profits, but might also destroy the firm. Shame and a sense of responsibility to fellow partners was a strong deterrent to obscene risk taking. The unholy combination of allowing investment banks to go public and repealing Glass Steagall in 1999, created a greed driven uncontrollable Too Big To Control brutish monstrosity consuming the world in its desire for more. It will only be stopped when it chokes to death while gorging on what’s left of the middle class.

The citizens, formerly known as the hard working American middle class, must accept their share of responsibility for the desperate circumstances we face. Some are guiltier than others, but we only need look in the mirror to find the culprits in allowing the bankers, politicians, military industrial complex, mass media and vested corporate interests to gain control over our country. The introduction of the credit card by Wall Street bankers as a must have for every citizen in the early 1970s coincided with the inflationary demons unleashed from Pandora’s Box by Nixon and the Federal Reserve, along with the peak of cheap U.S. oil production. Thus began four decades of real wages declining and consumer debt soaring. A nation of people that believed in saving before purchasing were given the freedom to spend money they didn’t have. The statistics paint a picture of a society gone mad:

  • Credit card debt grew from $5 billion in 1971 to $856 billion today, a 17,000% increase in forty-two years. GDP rose from $1.2 trillion to $16.6 trillion, a mere 1,400% increase. Real GDP only grew by 300%. Wages have grown from $600 billion to $7 trillion, a 1,200% increase. Real disposable personal income per capita grew from $17,200 to $36,800, a 200% increase.
  • Non-revolving debt (auto, student loan) grew from $127 billion in 1971 to $1.98 trillion today, a 1,600% increase.
  • There are over 600 million credit cards in circulation within the U.S. and Americans charged over $2.1 trillion last year.
  • Over 40% of Americans carry a balance on their credit card from month to month, with an average balance of $8,200 and an average interest rate of 13%.
  • 40% of all low and middle income households must rely on their credit cards to pay basic living expenses like rent, mortgage, utilities, groceries, real estate taxes, income taxes, along with their “needed” iPhones, HDTVs, bling, stainless steel appliances, and tattoo artwork.
  • Wall Street banks have written off over $300 billion in credit card debt since 2008 (and passing the bill to taxpayers), while bilking their customers out of $60 billion per year in late fees and overdraft fees.

Despite the storyline of austerity, consumer credit outstanding has reached an all-time high of $2.84 trillion because Bernanke and his Wall Street puppeteers require perpetual debt expansion to keep their Ponzi scheme alive. Federal government dispensation of loans to subprime student borrowers has helped mask the true unemployment rate and Federal government doling out of subprime auto loans through Ally Financial and their crony Wall Street partners has created a fake auto recovery. The Blackrock/Wall Street “rent to own” faux housing recovery was designed by our owners to lure clueless math challenged dupes back into the housing market. Our entire economy is nothing but a confidence game at this point.

The four decade long orgy of debt couldn’t have ensued if our currency had remained linked to the barbaric relic – gold. The apologists and lackeys for the vested interests scorn and ridicule the notion of our economic system being burdened with any checks or balances. This is where the interests of those in power and those being ruled have coincided, as a fiat based monetary system allowed unlimited spending to keep the welfare/warfare state growing, enriching the crony capitalists, deepening the power of the state, and providing the masses with foreign made trinkets, baubles, corporate logoed clothing, techno-gadgets, and pimped out financed wheels. The concepts of self-restraint, discipline, saving for a rainy day, prudence, discretion, and deferred gratification are rarely displayed in modern day America. In a case of mass delusion, Americans have convinced themselves to live for today, recklessly ignore their futures, irresponsibly spend money they don’t have on things they don’t need, neglect their civic duty towards future generations, choose ignorance over knowledge, and vote for spineless politicians who promise them entitlements that are mathematically impossible to honor. The public’s foolish attitude towards debt accumulation matches the arrogance of our gutless intellectually dishonest leaders.

“When people pile up debts they will find difficult and perhaps even impossible to repay, they are saying several things at once. They are obviously saying that they want more than they can immediately afford. They are saying, less obviously, that their present wants are so important that, to satisfy them, it is worth some future difficulty. But in making that bargain they are implying that when the future difficulty arrives, they’ll figure it out. They don’t always do that.” – Michael Lewis – Boomerang

The manner in which our leaders are governing the country and citizens are living their lives can only be considered normal in relation to residing in a profoundly abnormal society. The American Dream of having the opportunity for upward mobility through educating yourself, working hard, accumulating wealth methodically by spending less than you earn, and reaching your full potential as a caring loving human being has been replaced by a perverted nightmare where we run on a hamster wheel for our entire lives trying to achieve the new American dream of accumulating throw away material goods, working to make the payments for McMansions, SUVs, stainless steel appliances, and iGadgets you rent from bankers, while driving yourself into an early grave by consuming mass quantities of processed poison and the stress created by trying to achieve the lifestyle sold to us by Madison Ave. maggots, Wall Street shysters and the mainstream media propagandists. The corporate fascists tell you what to believe, which “enemy” to fear, how you should look, what to eat, what drug to take for the illnesses caused by the food they lured you to eat, the kind of house you need to impress your friends and family, and the car you need to drive to impress your neighbors. As George Carlin aptly pronounced: “It’s called the American Dream because you’d have to be asleep to believe it.” – either asleep or insane.

“Normal is getting dressed in clothes that you buy for work and driving through traffic in a car that you are still paying for – in order to get to the job you need to pay for the clothes and the car, and the house you leave vacant all day so you can afford to live in it.”  – Ellen Goodman

Our profoundly abnormal society of materialistic zombies, who mindlessly obey the commands and marketing messages of the financial elite, has staked their futures and the future of the country on the wisdom and brilliance of an Ivy League academic who never worked a day in the real world, didn’t spot the largest fraudulent housing bubble in world history, and whose unlawful acts as Federal Reserve chairman have enriched the banking whores who destroyed the country and impoverished what remains of the dying middle class. It’s the height of insanity for the American people to trust these crooked high priests of finance to cure a disease they spread with their immoral, traitorous policies over the last century. Bernanke and his lackeys, in a desperate last gasp gamble to prolong their fiat currency pillaging of the peasants, have rolled the dice with QE to infinity, accounting fraud, and further enrichment of their corporate masters.

“Viewed as a religious cult, modern finance revolves around the miracle of the spontaneous generation of money in a set of rituals performed by the high priests of central banking. People hang on the high priests’ every word, attempting to divine the secret meaning behind their cryptic utterances. Their interventions before the unknowable deity of global finance assure them of economic recovery and continued prosperity, just as a shaman’s rain dance guarantees rain or ritual sacrifice atop a Mayan pyramid once promised a bountiful harvest of maize.” – Dimitri Orlov – The Five Stages of Collapse

Bernanke will eventually roll craps. When he does, the collapse will be epic and 2008 will seem like a walk in the park. In Part 3 of this article I will speculate on the timing, scope and consequences of the coming collapse. It’s not going to be a happy ending, especially for the existing social order.

AVAILABLE

“Facts do not cease to exist because they are ignored.” – Aldous Huxley

 

 

Six months ago I wrote an article called Are You Seeing What I’m Seeing?, describing my observations while traveling along Ridge Pike in Montgomery County, PA and motoring to my local Lowes store on a Saturday. My observations were in conflict with the storyline portrayed by the mainstream media pundits, Ivy League PhD economists, Washington politicians, and Wall Street shills. It is clear now that I must have been wrong. No more proof is needed than the fact the Dow has gone up 1,500 points, or 11%, since I wrote the article. Everyone knows the stock market reflects the true health of the nation – multi-millionaire Jim Cramer and his millionaire CNBC talking head cohorts tell me so. Ignore the fact that the bottom 80% only own 5% of the financial assets in this country and are not benefitted by the stock market in any way.

The mainstream corporate media that is dominated by six mega-corporations (Time Warner, Disney, Murdoch’s News Corporation, Comcast, Viacom, and Bertelsmann), has one purpose as described by the master of propaganda – Edward Bernays:

“The conscious and intelligent manipulation of the organized habits and opinions of the masses is an important element in democratic society. Those who manipulate this unseen mechanism of society constitute an invisible government which is the true ruling power of our country. …We are governed, our minds are molded, our tastes formed, our ideas suggested, largely by men we have never heard of. This is a logical result of the way in which our democratic society is organized. Vast numbers of human beings must cooperate in this manner if they are to live together as a smoothly functioning society. …In almost every act of our daily lives, whether in the sphere of politics or business, in our social conduct or our ethical thinking, we are dominated by the relatively small number of persons…who understand the mental processes and social patterns of the masses. It is they who pull the wires which control the public mind.

These media corporations’ task is to use propaganda and misinformation to protect the interests of the status quo. The ruling class has the power to manipulate public opinion, obscure the truth, alter government data, and outright lie, but they can’t control the facts and reality smacking the average person in the face every day. Based on the performance of the stock market and the storyline of economic recovery being peddled by the corporate media, the facts must surely support their contention. Here are a few facts about what has really happened in the last six months since I wrote my article:

  • The working age population has grown by 1.1 million, the number of employed Americans is up 500k, while the number of people who have left the labor force has gone up by 600k. The BLS reports the unemployment rate has fallen without blinking an eye or turning red with embarrassment.
  • The number of Americans entering the Food Stamp Program in the last six months totaled 1 million, bringing the total to 47.8 million, or 20% of all households (up 15 million since the Obama economic recovery began in December 2009).
  • Existing home sales have increased by a scintillating 2.9% on a seasonally adjusted annual basis and average prices have fallen by 6% in the last six months. It is surely a great sign that 32% of all home sales are to Wall Street investors and 25% are either foreclosure sales or short sales. A large percentage of the remaining sales are funded by 3% down FHA government backed loans.
  • There were 31,000 new homes sales in January versus 34,000 new home sales six months prior. Through the magic of seasonal adjustment, this translates into a 15% increase.
  • Single family housing starts were 41,600 in February versus 51,400 six months prior. Even using seasonal adjustments, the government drones can only report a pathetic 4.7% annualized increase and flat starts over the last three months, with mortgage rates at all-time lows.
  • The National Debt has gone up by $750 billion in the last six months, while Real GDP has gone up by less than $150 billion.
  • Real hourly earnings have not increased in the last six months.
  • Consumer debt has risen by $65 billion as the Federal Government has doled out student loans like candy and auto loans (through the 80% government owned Ally Financial – aka GMAC, aka Ditech, aka ResCap) like crack dealer in West Philly.
  • The Federal Reserve has increased their balance sheet by $385 billion in the last six months by buying toxic mortgages from Wall Street banks and the majority of Treasuries issued by the government to fund the $1 trillion annual deficits being produced by the Obama administration. It now totals $3.2 trillion, up from $900 billion in September 2008, and headed to $4 trillion before this year is out.
  • Retail sales have increased by less than 2% over the last six months and are barely 1% above last February. On an inflation adjusted basis, retail sales are falling. Other than internet sales and government financed auto sales, every other retail category is negative year over year. This is reflected in the poor sales and earnings reports from JC Penney, Sears, Best Buy, Wal-Mart, Target, Lowes, Kohl’s, Darden, McDonalds, and Yum Brands. I’m sure next quarter will be gangbusters, with the Obama payroll tax increase, Obamacare premium increases, 15% surge in gasoline prices, and continued inflation in food and energy.

Considering that 71% of GDP is dependent upon consumer spending (versus 62% in 1979 before the financialization of America), the dreadful results of retailers and restaurants even before the Obama tax increases confirms the country has been in recession since the second half of 2012. In 1979 the economy was still driven by domestic investment that accounted for 19% of GDP. Today, it wallows at all-time lows of 13%. In addition, our trade deficits, driven by debt fueled consumption, subtract 3.5% from GDP. These facts are reflected in the depressed outlook of small business owners who are the backbone of growth, hiring and entrepreneurship in this country. Small businesses of 500 employees or less employ half of all the private industry workers in the country and account for 65% of all new jobs created. There are approximately 27 million small businesses versus 18,000 large businesses. The chart below does not paint an improving picture. The small business optimism has dropped from an already low 92.8 in September 2012 to 90.8 in March 2013.

Small business optimism report for March 2013

The head of the NFIB couldn’t make the situation any clearer:

“While the Fortune 500 is enjoying record high earnings, Main Street earnings remain depressed. Far more firms report sales down quarter over quarter than up. Washington is manufacturing one crisis after another—the debt ceiling, the fiscal cliff and the Sequester. Spreading fear and instability are certainly not a strategy to encourage investment and entrepreneurship. Three-quarters of small-business owners think that business conditions will be the same or worse in six months. Until owners’ forecast for the economy improves substantially, there will be little boost to hiring and spending from the small business half of the economy.” — NFIB chief economist Bill Dunkelberg

If consumers, who account for 71% of the economy, aren’t spending, and small business owners, who do 65% of all the hiring in the country, are petrified with insecurity, why is the stock market hitting all-time highs and the corporate media proclaiming happy days are here again? It can be explained by the distribution of wealth and income in this country. Every media pundit, politician, Wall Street shill, Ivy League PhD economist, and corporate titan you see on CNBC, Fox or any corporate media outlet is a 1%er or better. The chart below shows the bottom 99% saw their real incomes decline between 2009 and 2011, while the top 1% reaped the stock market gains and corporate bonuses for using “creative” accounting to generate record corporate profits. The trend in 2012 through today has only widened this gap, as real worker wages have continued to decline and the stock market has advanced another 20%.

The feudal financial industry lords are feasting on caviar and champagne in their mountaintop manors while the serfs and peasants scrounge in the gutters for scraps and morsels. This path has been chosen by the king (Obama) and enabled by his court jester (Bernanke). Money printing and inflation are their weapons of choice. We are living in a 21st Century version of the Dark Ages.

On the Road Again

I’ve been baffled by a visible disconnect between deteriorating data and the storyline being sold to the ignorant masses by the financial elitists that run the show. The websites and truthful analysts that I respect and trust (Zero Hedge, Mish, Jesse, Karl Denninger, John Hussman, David Stockman, Financial Sense and a few others) provide analytical evidence on a daily basis that confirm my view that our economic situation is worsening. We are all looking at the same data, but the pliable faux journalists that toil for their corporate masters spin the data in a manner designed to mislead and manipulate in order to mold public opinion, as Edward Bernays taught the invisible ruling class. As you can see, numbers and statistical data can be spun, adjusted, and manipulated to tell whatever story you want to depict. I prefer to confirm or deny my assessment with my observations out in the real world. I spend 12 hours per week cruising the highways and byways of Montgomery County and Philadelphia as I commute to and from work and shuttle my kids to guitar lessons, friends’ houses, and local malls. I can’t help but have my antenna attuned to what I’m seeing with my own eyes.

As I detailed in my previous article, Montgomery County is relatively affluent area with the dangerous urban enclaves of Norristown and Pottstown as the only blighted low income, high crime areas in the 500 square mile county of 800,000 people. The median household income and median home prices are 50% above the national averages. Major industries include healthcare, pharmaceuticals, insurance and information technology. It is one of only 30 counties in the country with a AAA rating from Standard & Poors (as if that means anything). On paper, my county appears to be thriving and healthy, with white collar professionals living an idyllic suburban existence. One small problem – the visual evidence as you travel along Welsh Road towards Montgomeryville or Germantown Pike towards Plymouth Meeting reveals a decaying infrastructure, dying retail meccas, and miles of empty office complexes.

I don’t think my general observations as I drive around Montgomery County are colored by any predisposition towards negativity. I see a gray winter like pallor has settled upon the land. I see termite pocked wooden fences with broken and missing slats. I see sagging porches. I see leaky roofs with missing tiles. I see vacant dilapidated hovels. I see mold tainted deteriorating siding on occupied houses. I see weed infested overgrown yards. I see collapsing barns and crumbling farm silos. I see houses and office buildings that haven’t been painted in 20 years. I see clock towers in strip malls with the wrong time. I see shuttered gas stations. I see retail stores with lights out in their signs. I see trees which fell during Hurricane Sandy five months ago still sitting in yards untouched. I see potholes not being filled. I see disintegrating highway overpasses and bridges. I constantly see emergency repairs on burst water mains. I see malfunctioning stoplights. I see fading traffic signage. I see regional malls with rust stained walls beneath their massive unlit Macys, JC Penney and Sears logos. I see hundreds of Space Available, For Lease, For Rent, Vacancy, For Sale and Store Closing signs dotting the suburban landscape. These sights are in a relatively affluent suburban county. When I reach West Philly, it looks more like Dresden in 1945.

                      Dresden – 1945                                                     Philadelphia – 2013

 

I moved to my community in 1995 when the economy was plodding along at a 2.5% growth rate. The housing market was still depressed from the early 90s recession. The retail strip centers and larger malls in my area were 100% occupied. Office parks were bustling with activity. Office vacancy rates were the lowest in twenty years during the late 1990s. National GDP has grown by 112% (only 50% after adjusting for inflation) since 1995, with personal consumption rising 122%. Domestic investment has only grown by 80%, but imports skyrocketed by 204%. If the economy has more than doubled in the last 18 years, how could retail strip centers in my affluent community have 40% to 70% vacancy rates and office parks sit vacant for years? The answer is that Real GDP has not even advanced by 50%. Using a true rate of inflation, not the bastardized, manipulated, tortured BLS version, shows the country has essentially been in contraction since the year 2000.

The official government sanctioned data does not match what I see on the ground, but the Shadowstats version of the data explains it perfectly.

My observations also don’t match up with the data reported by the likes of Reis, Trepp, Moody’s and the Federal Reserve. Reis reports a national vacancy rate of 17.1% for offices, barely below its peak of 17.6% in late 2010. Vacancy rates are 35% above 2007 levels and more than double the rates in the late 1990s. But what I realized after digging into the methodology of these reported figures is the true rates are significantly higher. First you must understand that Reis and Trepp are real estate companies who are in business to make money from commercial real estate transactions. It is in their self -interest to report data in the most positive manner possible – they’ve learned the lessons of Bernays. These mouthpieces for their industry slice and dice the numbers according to major markets, minor markets, suburban versus major cities, and most importantly they only measure Class A office space.

I didn’t realize the distinctions between classes when it comes to office space. The Building Owners and Managers Association describes the classes:

Class A office buildings have the “most prestigious buildings competing for premier office users with rents above average for the area.” Class A facilities have “high quality standard finishes, state of the art systems, exceptional accessibility and a definite market presence.” Class B office buildings as those that compete “for a wide range of users with rents in the average range for the area.” Class B buildings have “adequate systems” and finishes that “are fair to good for the area,” but that the buildings do not compete with Class A buildings for the same prices. Class C buildings are aimed towards “tenants requiring functional space at rents below the average for the area.”

So we have landlords self-reporting Class A vacancy rates in big markets to a real estate company that reports them without verification. Is it in a landlord’s best interest to under-report their vacancy rate? You bet it is. If potential tenants knew the true vacancy rates, they would be able to negotiate much lower rents. There is a beautiful Class A 77,000 square foot building near my house that was built in 2004. Nine years later there is still a huge Space Available sign in front of the building and it appears at least 50% vacant.

I pass another Class A property on Welsh Road called the Gwynedd Corporate Center that consists of three 40,000 square foot buildings in a 13 acre office park. It was built in 1998 and is completely dark. The vacancy rate is 100%. As I traveled down Germantown Pike last week I noted dozens of Class A office complexes with Space Available signs in front. I’m absolutely certain that vacancy rates in Class A offices in Montgomery County exceed 25%. When you expand your horizon to Class B and Class C office space, vacancy rates exceed 50%. The only booming business in my suburban paradise is Space Available sign manufacturing. We probably import those from China too. Despite the spin put on the data by the real estate industry, Moody’s reported data supports my estimates:

  • The values of suburban offices in non-major markets are 43% below 2007 levels.
  • Industrial property values in non-major markets are 28% below 2007 levels.
  • Retail property values in non-major markets are 35% below 2007 levels.

The data being reported by Reis regarding vacancies in strip malls and regional malls is also highly questionable, based on my real world observations. The reported vacancy rates of 8.6% for regional malls and 10.7% for strip malls, barely below their 2011 peaks, are laughable. Again, there is no benefit for a landlord to report their true vacancy rate. The truth will depress rents further. This data is gathered by surveying developers and landlords. We all know how reputable and above board real estate professionals are – aka David Lereah, Larry Yun. A large strip mall near my house has a 70% vacancy rate, with another, one mile away, with a 50% vacancy rate. Anyone with two eyes and functioning brain that has visited a mall or driven past a strip mall knows that vacancy rates are at least 15%, the highest in U.S. history. These statistics don’t even capture the small pizza joints, craft shops, antique outlets, candy stores, book stores, gas stations and myriad of other family run small businesses that have been forced to close up shop in the last five years.

The disconnect between reality, the data reported by the mouthpieces of the status quo, and financial markets is as wide as the Grand Canyon. Even the purveyors of false data can’t get their stories straight. Trepp has been reporting steadily declining commercial delinquency rates since July 2012, when they had reached 10.34%, the highest level since the early 1990s. The decline is being driven solely by apartment complexes and hotels. Industrial and retail delinquencies continue to rise and office delinquencies are flat over the last three months. Again, the definition of delinquent is in the eye of the beholder.

The quarterly delinquency rates on commercial loans reported by the Federal Reserve is less than half the rate being reported by Trepp, at 4.13%. Bennie and his band of Ivy League MBA economists have reported 10 consecutive quarters of declining commercial loan delinquency rates. This is in direct contrast to the data reported by Trepp that showed delinquencies rising during 2012.

Real estate loans

All

Booked in domestic    offices

Residential 1

Commercial 2

Farmland
2012:4

7.57

10.07

4.13

2.67
2011:4

8.48

10.34

6.11

3.26
2010:4

9.12

10.23

7.96

3.59
2009:4

9.59

10.54

8.73

3.42
2008:4

6.04

6.67

5.49

2.28
2007:4

2.91

3.08

2.75

1.51
2006:4

1.70

1.95

1.32

1.41

The data being reported doesn’t pass the smell test. Commercial vacancy rates are at or above the levels seen during the last Wall Street created real estate crisis in the early 1990’s. During 1991/1992 commercial loan delinquency rates ranged between 10% and 12%. Today, with the same or higher levels of vacancy, the Federal Reserve reports 4% delinquency rates. When the latest Wall Street created financial collapse struck in 2008 and commercial property values crashed while vacancy rates soared, there were dire predictions of huge loan losses between 2010 and 2012. Commercial real estate loans generally rollover every 5 to 7 years. The massive issuance of dodgy subprime commercial loans between 2005 and 2007 would come due between 2010 and 2012. But miraculously delinquency rates have supposedly plunged from 8.78% in mid-2010 to 4.13% today. The Federal Reserve decided in 2009 to look the other way when assessing whether a real estate loan would ever be repaid. A loan isn’t considered delinquent if the lender decides it isn’t delinquent. The can’t miss strategy of extend, pretend and pray was implemented across the country as mandated by the Federal Reserve. This pushed out the surge in loan maturities to 2014 – 2016.

In an economic system that rewarded good choices and punished those who took ridiculous undue risks and lost, real estate developers, mall owners, and office landlords would be going bankrupt in large numbers and loan losses for Wall Street Too Stupid to Succeed banks would be in the billions. Developers took out loans in the mid-2000’s which were due to be refinanced in 2012. The property is worth 35% less and the rental income with a 20% vacancy rate isn’t enough to cover the interest payments on the loan. The borrower would have no option but to come up with 35% more cash and accept a higher interest rate because the risk of default had risen, or default. Instead, the lenders have pretended the value of the property hasn’t declined and they’ve extended the term of the loan at a lower interest rate. This was done on the instructions of the Federal Reserve, their regulator. The plan is dependent on an improvement in the office and retail markets. It seems the best laid plans of corrupt sycophant central bankers are going to fail.

Eyes Wide Open

There are 1,300 regional malls in this country, with most anchored by a JC Penney, Sears, Barnes & Noble, or Best Buy. The combination of declining real household income, aging population, lackluster employment growth, rising energy, food and healthcare costs, mounting tax burdens, and escalating on-line purchasing will result in the creation of 200 or more ghost malls over the next five years. The closure of thousands of big box stores is baked in the cake. The American people have run out of money. They have no equity left in their houses to tap. The average worker has only $25,000 of retirement savings and they are taking loans against it to make the mortgage payment and put food on the table. They can’t afford to perform normal maintenance on their property and are one emergency away from bankruptcy. In a true cycle of doom, most of the jobs “created” since 2009 are low skill retail jobs with little or no benefits. As storefronts go dark and more “Available” signs are erected in front of these weed infested eyesores, more Americans will lose their jobs and be unable to do their 71% part in our economic Ponzi scheme.

The reason office buildings across the land sit vacant, with mold and mildew silently working its magic behind the walls and under the carpets, is because small businesses are closing up shop and only a crazy person would attempt to start a new business in this warped economic environment of debt dependent diminishing returns. The 27 million small businesses in the country are fighting a losing battle against overbearing government regulations, increasingly heavy tax burdens, operating cost inflation, Obamacare mandates, a low skill poorly educated workforce, and customers with diminishing resources and declining disposable income. Small business owners are not optimistic about the future because they don’t have a sugar daddy like Bernanke to provide them with free money and a promise to bail them out if their high risk investments go bad. With small businesses accounting for 65% of all new hiring in this country and looming healthcare taxes, mandates, regulations and penalties approaching like a freight train, there is absolutely zero probability that office buildings will be filling up with new employees in the next few years. With hundreds of billions in commercial real estate loans coming due over the next three years, over 60% of the loans in the office and retail category, vacancy rates at record levels, and property values still 30% to 40% below the original loan values, a rendezvous with reality awaits. How long can bankers pretend to be paid on loans by developers who pretend they are collecting rent from non-existent tenants who are selling goods to non-existent customers? The implosion in the commercial real estate market will also blow a gaping hole in the Federal Reserve balance sheet, which is leveraged 55 to 1.

federal reserve balance sheet

I regularly drive along Schoolhouse Road in Souderton. It is a winding country road with dozens of small manufacturing, warehousing, IT, aerospace, auto repair, bus transportation, retail and landscaping businesses operating and trying to scratch out a small profit. Most of these businesses have been operating for decades. I would estimate that most have annual revenue of less than $2 million and less than 100 employees. It is visibly evident they have not been thriving, as their facilities are looking increasingly worn down and in disrepair. Their access to credit has been reduced since the 2008 crisis, as only the Wall Street banks and mega-corporations with Washington lobbyists received Bennie Bucks and Obama stimulus pork. These small businesses have been operating on razor thin margins and unable to invest in their existing facilities or expand their businesses. The tax increases just foisted upon small business owners and their employees, along with Obamacare mandates which will drive healthcare costs dramatically higher, and waning demand due to lack of income, will surely push some of these businesses over the edge. There will be some harsh lessons learned on Schoolhouse Road over the next few years. I expect to see more of these signs along Schoolhouse Road and thousands of other roads in the next few years.

The mainstream media pawns, posing as journalists, have not only gotten the facts wrong regarding the current situation, but their myopia extends into the near future. The perpetual optimists that always see a pot of gold at the end of the rainbow are either willfully ignorant or a product of our government run public education system and can’t perform basic mathematical computations. As pointed out previously, consumer spending drives 71% of our economy. As would be expected, the highest level of annual spending occurs between the ages of 35 to 54 years old when people are in their peak earnings years. Young people are already burdened with $1 trillion of government peddled student loan debt and are defaulting at a 20% rate because there are no decent jobs available. Millions of Boomers are saddled with underwater mortgages, prodigious levels of credit card and auto loan debt, with retirement savings of $25,000 or less. Anyone expecting the young or old to ramp up spending over the next decade must be a CNBC pundit, University of Phoenix MBA graduate or Ivy League trained economist.

There will be 10,000 Boomers per day turning 65 years old for the next 18 years. Consumers in the 65-74 age segment spend 28% less on average than during their peak years. It is estimated that between 2010 and 2020 there will be approximately 14.5 million more consumers aged 65 or older. The number of Americans in their peak spending years will crash over the next decade. This surely bodes well for our suburban sprawl, mall based, cheap energy dependent, debt fueled society. Do you think this will lead to a revival in retail and office commercial real estate?

We’ve got $1 trillion annual deficits locked in for the next decade. We’ve got total credit market debt at 350% of GDP. We’ve got true unemployment exceeding 20%. We’ve had declining real wages for thirty years and no change in that trend. We’ve got an aging, savings poor, debt rich, obese, materialistic, iGadget distracted, proudly ignorant, delusional populace that prefer lies to truth and fantasy to reality. We’ve got 20% of households on food stamps. We’ve got food pantries, thrift stores and payday loan companies doing a booming business. We’ve got millions of people occupying underwater McMansions in picturesque suburban paradises that can’t make their mortgage payments or pay their utility bills, awaiting their imminent eviction notice from one of the Wall Street banks that created this societal catastrophe.

We’ve got a government further enslaving the middle class in student loan debt with the false hope of new jobs that aren’t being created. We’ve got a shadowy unaccountable organization, owned and controlled by the biggest banks in the world, that has run a Ponzi scheme called a fractional reserve lending system for 100 years, and inflated away 96% of the purchasing power of the U.S. dollar. We’ve got a self-proclaimed Ivy League academic expert on the Great Depression (created by the Federal Reserve) who has tripled the Federal Reserve balance sheet on his way to quadrupling it by year end, who has promised QE to eternity with the sole purpose of enriching his benefactors while impoverishing senior citizens and the middle class. He will ultimately be credited in history books as the creator of the Greater Depression that destroyed the worldwide financial system and resulted in death, destruction, chaos, starvation, mayhem and ultimately war on a grand scale. But in the meantime, he serves the purposes of the financial ruling class as a useful idiot and will continue to spew gibberish and propaganda to obscure their true agenda.

It is time to open your eyes and arise from your stupor. Observe what is happening around you. Look closely. Does the storyline match what you see in your ever day reality? It is them versus us. Whether you call them the invisible government, ruling class, financial overlords, oligarchs, the powers that be, ruling elite, or owners; there are powerful wealthy men who call the shots in this global criminal enterprise. Their names are Dimon, Corzine, Blankfein, Murdoch, Buffett, Soros, Bernanke, Obama, Romney, Bloomberg, Fink, among others. They are using every means at their disposal to retain their control and power over the worldwide economic system and gorge themselves like hyenas upon the carcasses of a crippled and dying middle class. They have nothing but contempt and scorn for the peasants. They’re your owners and consider you as their slaves. They don’t care about you. They think the commoners are unworthy to be in their presence. Time is growing short for these psychopathic criminals. No amount of propaganda can cover up the physical, economic, social, and psychological descent afflicting our world. There’s a bad moon rising and trouble is on the way. The time for hard choices is coming. The words of Edward Bernays represent the view of the ruling class, while the words of George Carlin represent the view of the working class.

“There’s a reason that education sucks, and it’s the same reason it will never ever be fixed. It’s never going to get any better, don’t look for it. Be happy with what you’ve got. Because the owners of this country don’t want that. I’m talking about the real owners now, the big, wealthy, business interests that control all things and make the big decisions. Forget the politicians, they’re irrelevant.

Politicians are put there to give you that idea that you have freedom of choice. You don’t. You have no choice. You have owners. They own you. They own everything. They own all the important land, they own and control the corporations, and they’ve long since bought and paid for the Senate, the Congress, the State Houses, and the City Halls. They’ve got the judges in their back pockets. And they own all the big media companies so they control just about all the news and information you get to hear. They’ve got you by the balls.

They spend billions of dollars every year lobbying to get what they want. Well, we know what they want; they want more for themselves and less for everybody else. But I’ll tell you what they don’t want—they don’t want a population of citizens capable of critical thinking. They don’t want well informed, well educated people capable of critical thinking. They’re not interested in that. That doesn’t help them. That’s against their interest. You know something, they don’t want people that are smart enough to sit around their kitchen table and figure out how badly they’re getting fucked by a system that threw them overboard 30 fucking years ago.” – George Carlin

 

BRAVE NEW WORLD (Oldie but Goodie)

Originally published in December 2009.

“Most human beings have an almost infinite capacity for taking things for granted. That men do not learn very much from the lessons of history is the most important of all the lessons of history.”Aldous Huxley

Aldous Huxley wrote the dystopian novel Brave New World in 1931 at the inauguration of the last Crisis period in America. Dystopia is the often futuristic vision of a society in which conditions of life are miserable and characterized by poverty, oppression, war, violence, disease, pollution, nuclear fallout and/or the abridgement of human rights, resulting in widespread unhappiness, suffering, and other kinds of pain. The novel was his response to the writings of H.G. Wells (Men Like Gods) and George Bernard Shaw which glorified socialism and a one World State. Orwell’s 1984, written in 1948, is the other famous dystopian novel of the era. Huxley had visited America during the Roaring 20’s and his experience provided the character for the novel. He was outraged by America’s out of control materialistic egocentric society. He witnessed youthful superficiality, commercialization, sexual promiscuity, and a self centered culture. Fellow writer G.K. Chesterton explained his view of Huxley’s novel:

 “After the Age of Utopias came what we may call the American Age, lasting as long as the Boom. Men like Ford or Mond seemed to many to have solved the social riddle and made capitalism the common good. But it was not native to us; it went with a buoyant, not to say blatant optimism, which is not our negligent or negative optimism. Much more than Victorian righteousness, or even Victorian self-righteousness, that optimism has driven people into pessimism. For the Slump brought even more disillusionment than the War. A new bitterness, and a new bewilderment, ran through all social life, and was reflected in all literature and art. It was contemptuous, not only of the old Capitalism, but of the old Socialism. Brave New World is more of a revolt against Utopia than against Victoria.”

Using Technology to Control Society

“Technological progress has merely provided us with more efficient means for going backwards.” Aldous Huxley

Science and technology are not inherently good or bad. They can be used or misused. They offer promise or peril. Ultimately, humanity can benefit from science and technology or it can be detrimental to our planet. Huxley envisioned a horrifying future where mankind used science and technology in a self destructive manner. He was disillusioned with the decadence of society and disgusted by the behavior of his class. Huxley’s outlook is a world where the vast majority of the populace is united under one World State. The world is restricted to two billion inhabitants. The inhabitants are strictly divided into five castes.  The world is controlled by Alphas and their subordinates, Betas. Below them, in descending order of brainpower and physique, are Gammas, Deltas, and Epsilons. Each caste is further subdivided into Plus and Minus (save for Epsilons, which are regular or semi-moron). Reproductive technology, referred to as the Bokanovsky Process, is used by the government (Alphas & Betas) to manage the number of human beings and their functions. The process is applied to fertilized human eggs in-vitro, causing them to split into identical genetic copies of the original. The State has eliminated procreation by loving couples. Ovaries are surgically removed from women. The lower caste children are created in hatcheries.

At the very pinnacle of society sit Alpha Double-Pluses, who serve as the future scientists and top administrators of the world. People in different castes are conditioned to be happy in their own way – they do not feel resentment towards other castes, but rather feel a slight contempt for people not members of their own caste.  The upper castes are intelligent, and have managerial jobs, where as the lower castes do the manual labor. The Alpha’s have what we would consider the best jobs, and it continues down until the Epsilons, who have the least skilled jobs. The Alphas are tall and fair, while the Epsilons are dark skinned.

The novel takes place in the year 2540 in London. The disturbing aspect is that we are now in the year 2009 and much of Huxley’s vision has come to fruition. At the heart of the World State’s control of its population is its rigid control over sexual mores and reproductive rights. Reproductive rights are controlled through an authoritarian system that sterilizes about two-thirds of women, requires the rest to use contraceptives, and surgically removes ovaries when it needs to produce new humans. The act of sex is controlled by a system of social rewards for promiscuity and lack of commitment. The United States has restricted population growth through a number of methods. Abortion on demand was made the law of the land in 1973. Since that date 50 million abortions have been performed in the U.S. I ask myself how many Martin Luther Kings, Stephen Hawkings, and Ernest Hemingways have been among those aborted before having the chance to positively impact our world.

abortions

Source: Alan Guttmacher Institute

Over 12 million women in the U.S. use the pill (available since 1960) on a daily basis in order to avoid pregnancy. The morning after pill was introduced in 1999. Planned Parenthood, created in 1916, has 850 locations in the United States offering easy access to abortions and other forms of contraception. The net result of these government supported efforts has been to cut the birth rate in half in the last century.

Year Births1 Rate2
1910 2,777,000 30.1
1920 2,950,000 27.7
1930 2,618,000 21.3
1940 2,559,000 19.4
1950 3,632,000 24.1
19603 4,257,850 23.7
19703 3,731,386 18.4
1980 3,612,258 15.9
1990 4,179,000 16.7
2000 4,058,814 14.7
2005 4,138,349 14.0

“We are living now, not in the delicious intoxication induced by the early success of science, but in a rather grisly morning after, when it has become apparent that what triumphant science has done hitherto is to improve the means for achieving unimportant or actually deteriorated ends.” Aldous Huxley

The upper classes in the U.S. have persuaded the lower classes to restrict their reproduction. They promote non-consequential promiscuity among the other classes while reproducing and raising the new ruling class. American society is also segmented into castes as portrayed by Huxley. The Alpha Double-Pluses are the Harvard MBAs running Goldman Sachs and the other mega-banks. Others in the Alpha caste are the Bushes, Kennedys, Rockefellers, Clintons, Gores, Warren Buffet, Bill Gates, and Paul Krugman. The Betas include Congressmen, bank executives, government bureaucrats, military leaders, and corporate executives. The Gammas and Deltas are the working classes that do the hard work without ever advancing. The Epsilons are the morons produced by the inner city public school system. They fill the non-thinking manual labor jobs of society.

The Gammas, Deltas, and Epsilons are brought up in conditioning centers. The Alphas and the Betas use technology to mould them into their predetermined roles in society. They use operant conditioning and sleep teaching to modify the behavior of the lower castes. Hatcheries rely on machines to condition bottled embryos to heat, sudden motion, and disease, allowing the embryos to fulfill their predestined jobs in specific climates. The science exists today to produce whatever traits are desired in our children. The procedure is called pre-implantation genetic diagnosis and is being practiced in fertility clinics in the U.S.

unnatural selection

Those in control of America also use conditioning and teaching to keep the lower classes in their place. The ruling elite send their children to exclusive private schools, grooming them for Harvard, Yale and Stanford. This guarantees they will be given the high level positions in business and government. After decades of pumping billions of tax dollars into public schools while instituting politically correct diversity programs to dumb down the curriculum, the ruling elite have conditioned a vast swath of Americans to care more about Tiger Woods’ driving and night putting skills than about the National Debt or the insidiousness of Federal Reserve induced inflation.

Total 18 Yrs No High School High School Some Associates Bachelors Advanced
& Over Degree Degree College Degree Degree Degree
millions       No Degree      
All Races 224,703 32,010 69,480 44,168 18,589 40,070 20,387
14.2% 30.9% 19.7% 8.3% 17.8% 9.1%
White 154,603 14,457 48,207 31,488 13,753 30,809 15,890
9.4% 31.2% 20.4% 8.9% 19.9% 10.3%
Asian 10,277 1,153 1,965 1,478 667 3,106 1,907
11.2% 19.1% 14.4% 6.5% 30.2% 18.6%
Black 26,363 4,779 9,213 5,659 2,132 3,215 1,364
18.1% 34.9% 21.5% 8.1% 12.2% 5.2%
Hispanic 30,286 11,191 9,130 4,684 1,729 2,539 1,012
37.0% 30.1% 15.5% 5.7% 8.4% 3.3%

Source: Census Bureau

Just as in Brave New World, the ruling Alphas are White and the lowest class Epsilons are dark skinned. Blacks and Hispanics represent 50% of all the high school dropouts even though they only make up 25% of the population. This guarantees a life of blue-collar low paying jobs for these people. Whites obtain 78% of the advanced degrees, guaranteeing them the positions of leadership in society. The social welfare state implemented by the ruling elite provides enough sustenance to the lower classes to keep them anesthetized, ignorant and easily manipulated. Whites also obtain 77% of the bachelor’s degrees, assuring that they will fill the Beta administrator positions in society.

Another technological method of keeping the masses tranquilized and distracted in the Brave New World is through high tech sports and entertainment. Sport is a pillar of the World State consisting of various games and activities which use high-tech equipment. Another key aspect of entertainment is the “feelies”. Users rest their hands on metal knobs protruding from the arms of their chair, allowing them to feel the physical sensations of the actors on-screen (usually in sexually-themed films). The mass production of HDTVs, CD players, Laptop computers, Blackberries, iPhones, iPods, luxury automobiles and other electronic toys distributed to the masses through easy credit policies has successfully distracted the populace from the pillaging of the country by the Alphas at Goldman Sachs. The feelies of today are 24 hour cable TV with 600 stations, downloadable movies, an unlimited amount of free porn on the internet, strip joints, and prostitution. Sports addicts can attend baseball, football, basketball, hockey, soccer, wrestling, boxing, auto racing, and Michael Vick sponsored dog fighting events year round, or watch it on TV 24 hours per day. With mindless jobs and unlimited distractions, the preponderance of citizens are as docile as sheep.

Soma is a biological method used by the Alphas to keep the lower castes sedated. It is a drug that provides an easy escape from the hassles of daily life and is employed by the government as a method of control through pleasure. It is ubiquitous and ordinary among the culture of the novel and everyone is shown to use it at some point, in various situations: sex, relaxation, concentration, confidence. It is seemingly a single-chemical combination of many of today’s drugs’ effects, giving its users the full hedonistic spectrum depending on dosage. As a kind of “sacrament,” it also represents the use of religion to control society. Huxley’s description of soma reveals its power:

“And if ever, by some unlucky chance, anything unpleasant should somehow happen, why, there’s always soma to give you a holiday from the facts. And there’s always soma to calm your anger, to reconcile you to your enemies, to make you patient and long-suffering. In the past you could only accomplish these things by making a great effort and after years of hard moral training. Now, you swallow two or three half-gramme tablets, and there you are. Anybody can be virtuous now. You can carry at least half your morality about in a bottle. Christianity without tears—that’s what soma is.”

American leaders bluster about the dangers of drug and alcohol abuse, but their actions speak otherwise. Americans can sedate themselves legally with alcohol, over the counter prescriptions, and tobacco. Almost 10% of the entire U.S. population, or 27 million people, are taking anti-depressant pills. Over 4 million children are being drugged with Ritalin every day to make them malleable. The government looks the other way as the middle class uses marijuana, heroine, and cocaine. The Epsilons (Blacks & Hispanics) on the other hand are prosecuted, with 2.3 million of them occupying cells in the thousands of prisons in the U.S. There are thousands of churches in the U.S. preaching the good word and sedating the masses. As they preach morality and sacrifice, there have been recurring instances of sexual deviation covered up church hierarchy and the bilking of congregations out of millions in contributions for the enrichment of the church leaders.

1920-2006

Consumer Society

“Most of one’s life is one prolonged effort to prevent oneself from thinking.People intoxicate themselves with work so they won’t see how they really are.” Aldous Huxley

Huxley formulated his dystopian world after observing the excessiveness of Americans during the Roaring 20’s. If he thought things were decadent and Americans were self consumed in the 1920’s, Huxley’s head would explode at the debauchery, ignorance materialism, and shallowness of Americans today. Our landfills contain more wealth than entire Third World countries. We throw away over 100 billion pounds of edible food per year. In his Brave New World Revisited, written in 1958, Huxley clearly laid out the dangers of consumerism:

“Consumerism re­quires the services of expert salesmen versed in all the arts (including the more insidious arts) of persuasion. Under a free enterprise system commercial propa­ganda by any and every means is absolutely indis­pensable. But the indispensable is not necessarily the desirable. What is demonstrably good in the sphere of economics may be far from good for men and women as voters or even as human beings.”

“Consider a simple example. Most cos­metics are made of lanolin, which is a mixture of purified wool fat and water beaten up into an emulsion. This emulsion has many valuable properties: it penetrates the skin, it does not become rancid, it is mildly antiseptic and so forth. But the commercial prop­agandists do not speak about the genuine virtues of the emulsion. They give it some picturesquely volup­tuous name, talk ecstatically and misleadingly about feminine beauty and show pictures of gorgeous blondes nourishing their tissues with skin food. “The cosmetic manufacturers,” one of their number has written, “are not selling lanolin, they are selling hope.” For this hope, this fraudulent implication of a promise that they will be transfigured, women will pay ten or twenty times the value of the emulsion which the propagandists have so skilfully related, by means of misleading symbols, to a deep-seated and almost universal feminine wish — the wish to be more attrac­tive to members of the opposite sex. The principles underlying this kind of propaganda are extremely sim­ple. Find some common desire, some widespread uncon­scious fear or anxiety; think out some way to relate this wish or fear to the product you have to sell; then build a bridge of verbal or pictorial symbols over which your customer can pass from fact to compensa­tory dream, and from the dream to the illusion that your product, when purchased, will make the dream come true.”

Our economic advancement has been marketed to Americans as “true happiness from consumption”. Every need can be realized through material gain. Success as a society is measured by GDP growth and the facade of prosperity. In Brave New World children are conditioned from birth to value consumption with such platitudes as “ending is better than mending,” which means buy a new one instead of fixing the old one. America has become the definitive throwaway society. Product waste has grown from 92 pounds per person per year in 1905 to 1,242 pounds per person per year in 2005. American human beings are lumped into the category of consumers by the mainstream media. Consumerism and consumer debt have been the contaminated lifeblood of the United States for the last three decades. Government actively promotes gambling by the poor, offering them false hope for riches. Americans squander $160 billion per year on lotteries and in casinos. Our society has become even more extreme than the Brave New World as we have outsourced our production to foreign countries, thereby gutting our economy. Even at the dawn of television Huxley realized the immense power for propagandists:

“Thanks to compulsory education and the rotary press, the propagandist has been able, for many years past, to convey his messages to virtually every adult in every civilized country. Today, thanks to radio and television, he is in the happy position of being able to communicate even with unschooled adults and not yet literate children.”

United States advertising expenditures, 1920–2007 in constant 2007 dollars (billions)*

us ad expenditures

The mass media is owned and controlled by mega-corporations run by the Alphas of our society. Colleges graduate thousands of people with the skills to manipulate the uninformed masses through advertising and propaganda. What passes for news organizations are just propaganda machines for a particular point of view. The public is distracted by the seemingly major differences between the two main political parties. The reality is that both parties are controlled by banking and corporate interests who pay for the laws that benefit their interests. Huxley’s description of political candidates in 1958 is even truer today:

“The methods now being used to merchan­dise the political candidate as though he were a deo­dorant positively guarantee the electorate against ever hearing the truth about anything.”

News people must be beautiful and entertainment is indispensable. They provide the people what they want – 24 hour coverage of Tiger Woods’ sex life, weeks of reporting about Michael Jackson’s death, and 10 seconds about the $100 trillion of unfunded liabilities we are leaving future generations. Truth is an inconvenience in the consumer society.

Incompatibility of Happiness & Truth

“Great is truth, but still greater, from a practical point of view, is silence about truth. By simply not mentioning certain subjects… totalitarian propagandists have influenced opinion much more effectively than they could have by the most eloquent denunciations.” Aldous Huxley

Mustapha Mond, World State Controller, believes that the population is better off with happiness than truth. In the Brave New World happiness is represented by immediate gratification of every citizen’s desire for food, sex, drugs, nice clothes, and other consumer trinkets. If the proletariats think they are happy, they won’t need to think or question reality. The World State cannot allow individuality to blossom. Free thinking individuals seek the truth. Spending time alone is considered an outrageous waste of time and money. Confession to a craving for individuality is shocking, horrifying, and embarrassing. John, the savage, grew up outside the World State and has studied Shakespeare. Everything that Shakespeare stood for: passion, love, intensity, seeking truth, relationships, and tragic endings, are at odds with the World State foundation. They cannot allow truth and true human happiness to exist in society or the Alphas will lose control.

The United States is the richest most powerful country in the history of the world. Our poorest live better than the aristocracy lived 100 years ago. We have indoor plumbing, air conditioning, heaters, clean water, automobiles, trains, jet airplanes, televisions, CD players, portable gadgets galore, free public education, fast food, gyms to work off the fast food, movies, the internet, restaurants, bars, concerts, sporting events, casinos, home improvement stores, grocery stores, discount stores, Wal-Mart, clothes stores, jewelry stores, dollar stores, churches, Disney World, Las Vegas, and Graceland. These are the “things” that are supposed to make Americans happy. Going into the woods alone, like Thoreau, to think is frowned upon. The propagandists sell the American public happiness in the form of material goods and services. If you don’t feel happy, take a pill. If you aren’t happy with your appearance have plastic surgery. If your spouse isn’t making you happy, cheat or get a divorce and try again. If your neighbor outdoes you by getting a $20,000 kitchen remodel, get yourself a $40,000 kitchen remodel. Happiness is a 6,000 sq ft McMansion with 5 bathrooms, a pool, game room, and Jacuzzi for your family of three. Having your neighbors see you driving a BMW 750Li will surely make you happy. Wearing a Rolex will definitely make you happy. If you die with the most toys, you’re still dead. Until reading a book to your three year old at bedtime is valued more than staying at the office until 10:00 pm to complete an investment offering, our society is destined for decline. Ours is not to reason why, but simply to do and die with a bare minimum of fuss.

In the Brave New World the policies of the State dehumanize the population. Stability and artificially induced happiness are more imperative than humanity and truth. Mustapha Mond explains to John that social stability has required the sacrifice of art, science, and religion. John protests that, without these things, human life is not worth living. After John eventually succumbs to the lure of the World State version of happiness, he hangs himself. An ending truly worthy of a Shakespearean tragedy. The pillars of our society are based upon the acquisition of material possessions using debt. Our society glorifies steroid taking athletes, sex crazed sports icons, drugged out entertainment personalities, vacuous TV housewives, and moronic cosmetically enhanced movie stars. Those who seek truth through questioning the status quo or digging for answers to questions the State doesn’t want asked, risk alienation and scorn. The Alphas (bankers) of our society issue the debt and convince the masses that accumulating more stuff will make them happy. The Alphas (media titans) use their mass media to persuade, manipulate, and sell their message of material happiness to the masses. The Alphas (politicians) use the taxes collected from the masses and the dollars printed by the bankers to distribute social welfare benefits to the lower classes, keeping them sedated and under control. Seeking the truth through the study of literature, the questioning of authority, and pondering of our existence on this earth are rare. Those who question and doubt the propaganda put out by those in authority are shunned and denigrated as being unpatriotic.

“Most ignorance is vincible ignorance. We don’t know because we don’t want to know.” Aldous Huxley

Dangers of an All-Powerful State

“Freedom is therefore a great good, tolerance a great virtue and regimentation a great misfortune. Meanwhile there is still some freedom left in the world. Many young people, it is true, do not seem to value freedom. But some of us still believe that, with­out freedom, human beings cannot become fully hu­man and that freedom is therefore supremely valuable. Perhaps the forces that now menace freedom are too strong to be resisted for very long. It is still our duty to do whatever we can to resist them.” Aldous Huxley

The all powerful State in Brave New World uses technology and mind control starting before birth until death to instruct people what they want. Power over the citizens is maintained by lulling them into a false sense of happiness and contentment to the point where personal freedom and thinking are unnecessary. Superficiality is encouraged by the World Controllers. The consequences of citizens rolling over to the rulers are a loss of dignity, morals, values, and emotions—in short, a loss of humanity. Amazingly, this book was written in 1931. Huxley’s vision, which seemed so outrageous in 1931, has come to fruition in less than 70 years, versus the 600 years in the novel. Huxley realized that technological advances which are almost universally hailed as progress are fraught with danger. Man has built higher than he can climb; man has unleashed power he is unable to control. Brave New World is Huxley’s warning to make man realize that since knowledge is power, he who manages and exploits knowledge exerts the authority. Science and technology should be the servants of man – man should not be adapted and enslaved to them.

In the novel the “Nine Years’ War” broke out in 2049 AD. It can be deduced that the conflict broke out in Europe, affected most of the planet, and caused enormous physical damage. It is repeatedly stated that chemical and biological weapons were broadly used during the war, particularly in mass air-raids against cities. Following the war the global economy collapsed and created an unprecedented worldwide economic crisis. Realizing that they could not force people to adopt the new lifestyle, the World Controllers instead united the planet into the One World State and began a nonviolent movement of change. This campaign included the closing of museums, the suppression of almost all literature published before 2059 AD, and the destruction of the few historical world monuments that had survived the Nine Years’ War. The type of war described in the novel is a very feasible scenario in our current environment. It is interesting that a worldwide economic crisis was the trigger for a One World Government. Our current worldwide economic crisis has resulted in our Federal Reserve propping up European banks with U.S. taxpayer funds and unprecedented coordination between worldwide fiscal policies.

Huxley wrote his novel in 1931 at the outset of the Great Depression. His vision did not take long to crystallize. FDR initiated social programs on a vast scale to satiate the masses with manual labor government created jobs and social services that encouraged reliance upon the state at the expense of freedom and liberty. His nightmare world became more of a reality after World War II as progressives were successful in creating the United Nations, NATO, World Bank, IMF, Bretton Woods system, and GATT. These organizations reduced the freedom of individual countries to the benefit of worldwide bureaucracies. These organizations have gained power over time, but their total incompetence and ineffectiveness has kept them from gaining total control over world populations.

We are now at a crucial juncture as the worldwide financial crisis and the sham global warming crisis are being used by the New World Order crowd to confiscate more of our freedoms and liberties. Socialist minded world leaders Gordon Brown and Barack Obama, along with the revered Henry Kissinger have referenced a New World Order while offering their Keynesian spending solutions to the worldwide financial crisis. A number of Obama advisors have written they support a one world government. The Copenhagen Conference on Global Warming has drawn thousands of one world government apostles. They want to use the scientifically unproven environmental crisis as a way to impose worldwide taxes on sovereign nations and to compel the citizens of the world to honor their green agenda. The use of propaganda in our school systems to scare children by telling them that polar bears are all dying, is part of their plan. Again, the subtle use of media and propaganda to influence the thinking of the willfully ignorant public has worked.

Dystopian Nation  

“Facts do not cease to exist because they are ignored.” Aldous Huxley

When I started this article I was unsure whether Huxley’s nightmare would resonate in our current reality. Sadly, much of his novel applies to our society. Even sadder, our society now resembles an amalgamation of the two most famous dystopian novels in history: 1984 and Brave New World. Social critic Neil Postman contrasted the two views of the future:

“What Orwell feared were those who would ban books. What Huxley feared was that there would be no reason to ban a book, for there would be no-one who wanted to read one. Orwell feared those who would deprive us of information. Huxley feared those who would give us so much that we would be reduced to passivity and egoism. Orwell feared that the truth would be concealed from us. Huxley feared the truth would be drowned in a sea of irrelevance. Orwell feared we would become a captive culture. Huxley feared we would become a trivial culture, preoccupied with some equivalent of the feelies, the orgy porgy, and the centrifugal bumblepuppy. As Huxley remarked in Brave New World Revisited, the civil libertarians and rationalists who are ever on the alert to oppose tyranny “failed to take into account man’s almost infinite appetite for distractions.” In 1984, Orwell added, people are controlled by inflicting pain. In Brave New World, they are controlled by inflicting pleasure. In short, Orwell feared that what we fear will ruin us. Huxley feared that what we desire will ruin us.”

Our civilization has fused the worst of both novels. Many people in our country aren’t capable of reading a book. Supposedly educated people have no interest in reading a book. The government withholds or manipulates information that is spoon fed to the public. Trivial meaningless information floods the airwaves, keeping the public continuously diverted from seeking truth. The truth is lost in shades of grey and purposeful misinformation. Supposed differences between the ruling parties distract the public from realizing they are being fleeced by those in power. Government has used fear to create agencies and departments that have taken away our liberties and freedoms through Orwellian surveillance techniques. Our dumbed down culture of hero worship, material pleasures, and ego enhancement is the representation of triviality. The Alphas have used our fears and desires to distract us from their plans to dominate and control every aspect of our lives. Their success is all but assured at this point.

I’m not optimistic that there are enough Americans who value freedom over presumed safety, security, and social welfare benefits. The public has been duped into believing thrilling falsehoods rather than unexciting truths. Huxley explains how the propagandists have stolen our freedom:

“In their anti-rational propaganda the enemies of freedom systematically pervert the resources of lang­uage in order to wheedle or stampede their victims into thinking, feeling and acting as they, the mind-manipulators, want them to think, feel and act. An education for freedom (and for the love and intelli­gence which are at once the conditions and the results of freedom) must be, among other things, an educa­tion in the proper uses of language.”

I do not pretend to have the answers. Intellectual curiosity, a skeptical nature, and not buying into our shallow culture are the best chance for change. Reading or re-reading Orwell’s 1984 and Huxley’s Brave New World and Brave New World Revisited will open your eyes to our plight. The current Fourth Turning will end in glory or tragedy. The choices we make as a society in the next 10 to 15 years will ultimately decide our fate. Huxley’s advice in Brave New World Revisited is wise, pertinent, and implementable today:

  • As recent history has repeatedly shown, the right to vote, by itself, is no guarantee of liberty. Therefore, if you wish to avoid dictatorship by referendum, break up modern society’s merely func­tional collectives into self-governing, voluntarily cooperating groups, capable of functioning outside the bureaucratic systems of Big Business and Big Govern­ment.
  • If you wish to avoid the spiritual impoverishment of individuals and whole societies, leave the metropolis and revive the small country community, or alternately humanize the me­tropolis by creating within its network of mechanical organization the urban equivalents of small country communities, in which individuals can meet and co­operate as complete persons, not as the mere embodi­ments of specialized functions.

As citizens of the American Republic we must answer the question posed by Huxley:

“Do we really wish to act upon our knowledge? Does a majority of the population think it worthwhile to take a good deal of trouble, in order to halt and, if possible, reverse the current drift toward totalitarian control of everything?”

“There is no darkness but ignorance. The devil can cite Scripture for his purpose.” William Shakespeare

ALL I WANT FOR CHRISTMAS IS THE TRUTH

“Eyes blinded by the fog of things
cannot see truth.
Ears deafened by the din of things
cannot hear truth.
Brains bewildered by the whirl of things
cannot think truth.
Hearts deadened by the weight of things
cannot feel truth.
Throats choked by the dust of things
cannot speak truth.”
― Harald Bell Wright – The Uncrowned King

I consider myself a seeker of truth. It isn’t easy finding it in todays’ world. In an alternate version of the famous scene from A Few Good Men, I picture myself telling Turbo Tax Timmy Geithner that I want the truth and his angry truthful response:

“Son, we live in a world that has Wall Street banks, and those banks have to be guarded by puppet politicians in Washington D.C. with lobbyist written laws and Madison Avenue PR maggots with media propaganda. Who’s gonna do it? You? You, Representative Paul? I have a greater responsibility than you could possibly fathom. You weep for the average middle class American family, and you curse the ruling oligarchs. You have that luxury. You have the luxury of not knowing what I know. That the death of the American middle class, while tragic, probably saved the bonuses of thousands of Wall Street bankers. And my existence, while grotesque and incomprehensible to you, increases the wealth of these same bankers who destroyed the worldwide economic system in 2008. You don’t want the truth because deep down in places you don’t talk about in the food bank line, you want me on Wall Street, you need me on Wall Street. We use words like derivative, fiscal stimulus, quantitative easing. We use these words as the backbone of a life spent syphoning off the wealth of the nation. You use them as a punch line. I have neither the time nor the inclination to explain myself to a man who rises and sleeps under the blanket of the very debt that I provide, and then questions the manner in which I provide it. I would rather you just said thank you, and went on your way, Otherwise, I suggest you pick up 1000 shares of Apple, and hope our high frequency trading supercomputers can ramp the market for a while longer. Either way, I don’t give a damn what you think you are entitled to.”

I find myself more amazed than ever at the ability of those in power to lie, misinform and obfuscate the truth, while millions of Americans willfully choose to be ignorant of the truth and yearn to be misled. It’s a match made in heaven. Acknowledging the truth of our society’s descent from a country of hard working, self-reliant, charitable, civic minded citizens into the abyss of entitled, dependent, greedy, materialistic consumers is unacceptable to the slave owners and the slaves. We can’t handle the truth because that would require critical thought, hard choices, sacrifice, and dealing with the reality of an unsustainable economic and societal model. It’s much easier to believe the big lies that allow us to sleep at night. The concept of lying to the masses and using propaganda techniques to manipulate and form public opinion really took hold in the 1920s and have been perfected by the powerful ruling elite that control the reins of finance, government and mass media.

Peddlers of Propaganda

“Great is truth, but still greater, from a practical point of view, is silence about truth.” – Aldous Huxley – Brave New World

 File:Edward Bernays.jpg   

Adolf Hitler understood the power of the big lie over the ignorant masses who want to believe:

“All this was inspired by the principle–which is quite true within itself–that in the big lie there is always a certain force of credibility; because the broad masses of a nation are always more easily corrupted in the deeper strata of their emotional nature than consciously or voluntarily; and thus in the primitive simplicity of their minds they more readily fall victims to the big lie than the small lie, since they themselves often tell small lies in little matters but would be ashamed to resort to large-scale falsehoods. It would never come into their heads to fabricate colossal untruths, and they would not believe that others could have the impudence to distort the truth so infamously. Even though the facts which prove this to be so may be brought clearly to their minds, they will still doubt and waver and will continue to think that there may be some other explanation. For the grossly impudent lie always leaves traces behind it, even after it has been nailed down, a fact which is known to all expert liars in this world and to all who conspire together in the art of lying.” – Adolf Hitler – Mein Kampf

We are all liars. We lie to friends, family and co-workers. We convince ourselves they are only small lies and just protect others from being hurt. We would rather be lied to than face the blunt truth about our deficiencies, shortcomings and failures. Willfully believing mistruths allows a person to become dependent upon those promulgating the mistruths. It relieves them of their responsibility to act upon the knowledge that something is wrong and must be fixed. It is a cowardly path to ultimate servitude and destruction. The German people chose this path in the 1930s and the American people have chosen a similar and ultimately destructive path today. The United States Office of Strategic Services prepared a psychological profile report during the war describing Adolf Hitler’s method for controlling the minds of the German masses:

“His primary rules were: never allow the public to cool off; never admit a fault or wrong; never concede that there may be some good in your enemy; never leave room for alternatives; never accept blame; concentrate on one enemy at a time and blame him for everything that goes wrong; people will believe a big lie sooner than a little one; and if you repeat it frequently enough people will sooner or later believe it.”

America’s corruptible politicians, greedy corporate chieftains, criminal banking overlords, and despicable media manipulators all learned the sordid lessons of mass propaganda from the masters. Our willingness to lie and be lied to set us up to be manipulated by those who understood the mass psychology of a nation. Goebbels and Hitler were heavily influenced by the father of propaganda – Edward Bernays. He and his disciples are professional poisoners of the public mind, exploiters of public foolishness and ignorance, and never allow truth to interfere with a good story. What master manipulators realized is that it is easier to change the attitude of millions than the attitude of one man. By analyzing and understanding the process and motives of how the group mind works, the invisible government has been able to manipulate and regulate the masses according to their will without the masses knowing they are being managed. Bernays described this elitist view of the world in 1928:

“Those who manipulate the unseen mechanism of society constitute an invisible government which is the true ruling power of our country. We are governed, our minds are molded, our tastes formed, our ideas suggested, largely by men we have never heard of. This is a logical result of the way in which our democratic society is organized. Vast numbers of human beings must cooperate in this manner if they are to live together as a smoothly functioning society. In almost every act of our lives whether in the sphere of politics or business in our social conduct or our ethical thinking, we are dominated by the relatively small number of persons who understand the mental processes and social patterns of the masses. It is they who pull the wires that control the public mind.” – Edward Bernays – Propaganda

The super-rich elite believe they are more intelligent, more capable of managing the affairs of state, masters of the financial world, and chosen to decide what is best for the masses. In reality, they are egocentric, psychotic, power hungry, myopic, self-serving ravenous vultures, feasting upon the carcass of a once great nation. Truth is inconsequential and irritating to their plans for world domination and control. Therefore, no truth will be forthcoming from any organization or person that is associated with the existing political, economic, financial or social order. Every bit of information that is permitted into the public realm has been vetted, manipulated and spun for public consumption. The public does not like bad news. They do not like hard facts. They do not like to think or do math. They want to be spoon fed mindless sound bites and happy talk. The oligarchs need to keep the masses sedated and subservient while they continue to plunder and pillage, so all data is massaged to provide a happy ending.

This is where I deviate from the ideologue one-trick ponies that refuse to see both sides of the issue. The ruling oligarchs are wealthy, influential, psychotic, amoral, and few. The masses are relatively poor, easily influenced, willfully ignorant, and many. The ruling oligarchs are most certainly evil, but the masses are not the hard working, stoic, downtrodden portrayed by liberal ideologues. One just needs to walk down the street in one of our urban enclaves, saunter through a suburban mall, or click on People of Wal-Mart to witness the tattooed, pierced, butt crack showing, slovenly, obese, and ignorant, attached to their electronic iGadgets, to understand how far our society has deteriorated.  Every individual born into this world has the capability to become educated, think critically, not follow the herd, live beneath their means, and not be influenced by propaganda. Aldous Huxley understood in 1931 that those in power could use material goods to invoke passivity and egotism among the populace. He feared that truth would be obscured by an avalanche of irrelevance (500 Reality TV shows), cultural trivialities (Lady Gaga, Lindsey Lohan), distractions (Professional sports), and pharmaceutical enhanced escape (Prozac). He saw the possibility that we would grow to love our servitude as the pleasures of life provided by our controllers overwhelmed any desire to think or question authority.

“There will be in the next generation or so a pharmacological method of making people love their servitude and producing dictatorship without tears, so to speak, producing a kind of painless concentration camp for entire societies so that people will in fact have their liberties taken away from them but will rather enjoy it.”  ― Aldous Huxley

By 1962 when Huxley wrote his last book, he was certain that his worst dystopian nightmares had been unleashed. His description of Western society fifty years ago could have been written today and accurately reflected our current economic paradigm. War, debt and consumption still make our world go round, but the end is nigh.

“Armaments, universal debt, and planned obsolescence – those are the three pillars of Western prosperity. If war, waste, and moneylenders were abolished, you’d collapse. And while you people are over-consuming the rest of the world sinks more and more deeply into chronic disaster.” – Aldous Huxley – Island

The pillars are crumbling. The $1.4 trillion wasted on two worthless wars of choice in the Middle East, the trillions wasted and liberties sacrificed for the never ending unwinnable War on Terror, the Keynesian spending frenzy that has driven the National Debt from $9 trillion to $16.3 trillion in the last five years, the looting of the American taxpayer by Wall Street and their co-conspirators at the Federal Reserve and in Congress, and the belief that ramping up the debt driven consumption that drives 71% of our GDP is our path to prosperity is absolutely freaking nuts. The pillars will not be abolished willingly. The ruling class depends upon their continued existence and expansion. There is the rub. The math doesn’t work. We’ve reached the point where continued expansion of debt and money printing no longer works. With a national debt to GDP ratio of 102% and a total credit market debt to GDP ratio of 350%, we have passed the Rogoff & Reinhart point of no return. This time is not different. A country cannot run trillion dollar deficits indefinitely and expect to not suffer the consequences. This is why those in power are increasingly resorting to propaganda, data manipulation, and outright lies to convince the masses of their omnipotence and brilliance in managing the fiscal affairs of the state.

 “One believes things because one has been conditioned to believe them.” – Aldous Huxley – Brave New World

Through decades of mass media messaging the masses have been conditioned to believe whatever those in power want them to believe. To our invisible government rulers we are nothing but rats to be manipulated through food pellets and shock therapy. Pleasure and fear of pain are the drivers of our warped society. The ruling oligarchs truly think they know what is best for the masses and believe any means is worthwhile as long as the ends support their agenda. This is blatantly obvious to anyone with their eyes open and their brain functioning. Sadly, the government run educational system produces mostly drones that are barely able to tie their own shoes, spell Cat, or make change from a one dollar bill. Only 20% of all high school seniors score high enough on the SAT test to get a B minus in college and most of these kids come from private and parochial schools. This is exactly what those in power prefer. They want non-critical thinking, mindless consumers, who don’t understand the criminal nature of Federal Reserve created inflation or their enslavement in the chains of debt at the hands of their Wall Street slave owners. They certainly don’t want the masses to understand that real median household net worth is lower today than it was in 1969. Luckily for the oligarchs, 95% of the public couldn’t define the terms: real, median or net worth. Math is hard.

The average person is inundated on a 24/7 basis with pabulum from liberal network media talking heads, CNBC Wall Street shills regurgitating whatever their sponsors desire, Fox News blonde bimbos and neo-con war mongers programmed to spew Rupert Murdoch talking points, MSNBC tingling leg faux journalists, NYT intellectually corrupt Nobel prize winners, NAR nitwits repeating “best time to buy” on a daily basis for the last 12 years, and government agencies whose sole purpose is to manipulate data in a way that supports the agenda of those in power. The intellectually lazy and willfully ignorant masses are no match for those who control the message and the media. How else can you explain their ability to convince millions of drones to line up for hours in front of a store and stampede like crazed hyenas to grab a $5 crockpot, the Chinese produced gadget of the moment or a designer top made by slave labor in safety conscious Bangladesh factories? How else can you explain a population willing to be molested by government TSA dregs in the name of security from phantom terrorists, the passive acceptance of military exercises in US cities, unquestioning submissiveness as Presidential Executive Orders allow the government dictatorial powers based on their judgment, the monitoring of internet and voice correspondence of all citizens, and believing that FBI agents luring clueless teenage Muslim dupes into fake terrorist plots, providing the fake explosives, and then announcing with great fanfare how they saved us from another 9/11?

But, the prize for boldest, most outrageous, blatant use of propaganda and misinformation to cover-up their criminal looting of America goes to Ben Bernanke, his cronies at the Federal Reserve, and the Wall Street banks that own and control our Central Bank. Having the gall to portray themselves as the stabilizer of our economic system over the last 100 years is a putrid joke on the dying and broke middle class. Their mandate has been stable prices, full employment, and avoiding financial crisis. It is a tribute to Bernays and the rest of the public relations swine that the average American actually believes inflation is a good thing and it is under control despite the FACT that 96.2% of their purchasing power has disappeared since 1900, with the most rapid decline occurring since Nixon closed the gold window in 1971.

inflation-currency

The average American actually believes Ben Bernanke saved us from a Great Depression when in actuality he saved the owners of the Federal Reserve from accepting the losses they generated through the greatest financial fraud in history. His “solutions” have zombified our economic system, just as the Japanese Central Bank did 20 years ago. He has destroyed the concept of saving, while rewarding the indebted and profligate with his QE to Infinity money printing policies. And the ignorant masses have been convinced by the corporate media and their corrupt government lackeys that Ben did this for them. Kyle Bass knows otherwise. He knows how the Fed and their backers have preyed upon the masses through their understanding of human psychology:

“Humans are optimistic by nature. People’s lives are driven by hopes and dreams which are all second derivatives of their innate optimism. Humans also suffer from optimistic biases driven by the first inalienable right of human nature which is self-preservation. It is this reflex mechanism in our cognitive pathways that makes difficult situations hard to reflect and opine on. These biases are extended to economic choices and events. The primary difficulty with this train of thought is the bias that most investors have for the baseline facts: they tend to believe that the central bankers, politicians, and other governmental agencies are omnipotent due to their success in averting a financial meltdown in 2009.

Central banks have become the great enablers of fiscal profligacy. The overarching belief is that there will always be someone or something there to act as the safety net. The safety nets worked so well recently that investors now trust they will be underneath them ad-infinitum. Markets and economists alike now believe that quantitative easing (“QE”) will always “work” by flooding the market with relatively costless capital. Unlimited QE and the zero lower bound (“ZLB”) are likely to bankrupt pension funds whose expected returns happen to be a good 600 basis points (or more) higher than the 10?year “risk-free” rate. The ZLB has many unintended consequences that are impossible to ignore.

Our belief is that markets will eventually take these matters out of the hands of the central bankers. These events will happen with such rapidity that policy makers won’t be able to react fast enough. The fallacy of the belief that countries that print their own currency are immune to sovereign crisis will be disproven in the coming months and years. Trillions of dollars of debts will be restructured and millions of financially prudent savers will lose large percentages of their real purchasing power at exactly the wrong time in their lives. Again, the world will not end, but the social fabric of the profligate nations will be stretched and in some cases torn. Sadly, looking back through economic history, all too often war is the manifestation of simple economic entropy played to its logical conclusion. We believe that war is an inevitable consequence of the current global economic situation.” – Kyle Bass

What’s Normal in a Profoundly Abnormal Society?

“The real hopeless victims of mental illness are to be found among those who appear to be most normal. Many of them are normal because they are so well adjusted to our mode of existence, because their human voice has been silenced so early in their lives, that they do not even struggle or suffer or develop symptoms as the neurotic does.” They are normal not in what may be called the absolute sense of the word; they are normal only in relation to a profoundly abnormal society. Their perfect adjustment to that abnormal society is a measure of their mental sickness. These millions of abnormally normal people, living without fuss in a society to which, if they were fully human beings, they ought not to be adjusted.” – Aldous Huxley – Brave New World Revisited

No sane person could honestly say that what has happened to our society over the last forty years, and particularly in the last five years, is normal. But somehow those in power have convinced the masses that $1.2 trillion deficits, 0% interest rates, declining real wages, the highest average gas prices in history, pre-emptive wars, policing the world and buying rubber dog shit produced in China with a credit card is normal and beneficial to our economy. It seems that I and a few million other people in this country are the abnormal ones. We choose not to be led to slaughter by our masters. The seekers of truth have turned to the alternative media and are able to connect with like-minded critical thinking individuals on websites like Zero Hedge, Jesse’s Americain Café, Of Two Minds, Mish, Financial Sense, among many other truth seeking blogs. This is dangerous to the powers that be and they are using their political clout and extreme wealth to try and lock down and control free speech on the internet. If this is accomplished all hope at disseminating truth will be lost.

Abraham Lincoln once said that he believed in the people and that if you told them the truth and gave them the cold hard facts they would meet any crisis. That may have been true in 1860, but not today. The cold hard facts are available for all to see:

  • A $16.3 trillion National Debt
  • 47 million people on food stamps
  • Over $222 trillion of unfunded Federal entitlement liabilities
  • Over $5 trillion of unfunded State entitlement liabilities
  • True unemployment above 20%.
  • True inflation above 5%.
  • A stock market at the same level as 1999, with a 10 year expected annual return of less than 4% – Stocks for the really, really long run. 10 year bond returns of 0% will be a miracle.
  • A savings rate of 3.7% and with Bernanke’s ZIRP, no incentive to save. Real hourly earnings continue to fall.

  • Baby Boomers within 10 years of retirement have saved an average of only $78,000, and more than a third of them have less than $25,000. More than half of U.S. workers have no retirement plan at all.
  • A crumbling, decaying infrastructure, with 150,000 structurally deficient bridges, bursting water mains, and an overstressed electrical grid.
  • Horrific government public education producing millions of low functioning morons.
  • Rotting social fabric, with 40% of children born out of wedlock (72% of black children) and a 50% divorce rate.
  • An energy policy based upon unicorns farting rainbows and press releases about green energy and the miracle of shale fracking, as average gas prices in 2012 and 2011 were the highest in U.S. history.

As the pitiful excuses for statesmen in Washington D.C. pander and posture about the dreaded fiscal cliff which was purposely created by the oligarchs as a show for the masses, none of the true issues above are being addressed. The dramatic compromise that will ultimately be reached between the equally corrupt parties will be hailed by the corporate media and Wall Street shysters and an HFT supercomputer engineered stock market rally will ensue. The cowardice of these politicians is revolting. As Huxley knew in 1958, politicians and propagandists prefer nonsense and storylines to truth, knowledge and honesty.

“Human beings act in a great variety of irrational ways, but all of them seem to be capable, if given a fair chance, of making a reasonable choice in the light of available evidence. Democratic institutions can be made to work only if all concerned do their best to impart knowledge and to encourage rationality. But today, in the world’s most powerful democracy, the politicians and the propagandists prefer to make nonsense of democratic procedures by appealing almost exclusively to the ignorance and irrationality of the electors.” – Aldous Huxley – Brave New World Revisited

We want to be lied to because the truth is too painful. Hope and denial with a dash of delusion is the recipe the mindless masses prefer. The average person doesn’t want to understand the chart below. They want to believe the U.S. will dominate economically and lead the world for decades to come. We are still the bright shining beacon of democracy on the mountaintop. Even though the facts unequivocally reveal a declining empire, the masses desperately grasp at straws in the wind. The United States share of world GDP will be vastly lower in 2021, as the hubris of declining empires never allows them to take the necessary steps to reverse the decline (Rome, Great Britain).  

It is fitting that during this magical Christmas season of fantasy, delusion, debt fueled material over-consumption and fairy tales, we look at the biggest fairy tale of all – the great jobs recovery. I know from the two thousand Obama campaign commercials I was forced to watch in the last few months and 500 robo-calls at dinner every night that we’ve added 4 million jobs due to Obama’s wise economic policies. The magical journey from a 10.3% unemployment rate to a 7.9% rate is a humdinger. I stumbled across a myriad of charts on those truth-telling websites that I had previously mentioned.

 “You shall know the truth and the truth shall make you mad.” ― Aldous Huxley

The first chart that grabbed my attention shows the historical relationship between the U3 unemployment rate reported to the masses versus the U6 truer picture of unemployment, along with the percentage of people unemployed for longer than 15 weeks. A funny thing happened shortly after the election of Barack Obama. From 1994 through 2008 the gap between the U3 and U6 rates consistently ranged between 3% and 4%. Suddenly, the gap surged to 7% and currently sits at almost 8%. The figure reported to the masses of 7.9% is so much easier to digest than the 15% to 17% that captures the truer level of unemployment. If the gap between these two figures had remained at the levels of the previous 14 years, the unemployment that should be reported to the masses would be 11%. That is unacceptable to those in power, so the data is massaged and the propaganda machine spins the storyline necessary to confuse and mislead the masses.

 

The next two charts from Mike Shedlock again reveal truths the existing social order doesn’t want you to know. Even though the working age population has grown by 10 million people since 2008, the BLS expects critical thinking people to believe the labor force has only grown by 1.3 million people. You see, the unemployment rate is calculated using the labor force. If your economic policies don’t create jobs, just adjust the labor force dramatically lower based on nothing. In desperate economic times, people do not voluntarily leave the workforce. Only a non-thinking drone would believe that 8.7 million Americans voluntarily left the workforce since 2008, when only 4 million left the workforce from 2003 through 2007. It is not a coincidence that student loan debt, which was taken over by the Obama administration in 2009 rose by $300 billion. Those in power have doled out these billions with no concern for credit risk or academic credentials in order to reduce the number of people in the labor force. Unemployed union Twinkie workers seeking a new career in lesbian studies can get a $20,000 loan from the American taxpayer to sit in their basement along with the 500,000 other University of Phoenix enrollees. The future $300 billion taxpayer bailout was worth it to keep the unemployment rate low enough to insure Obama’s re-election.      

The Obama PR machine never fails to expound upon the fact that the economy added 4.9 million jobs since January 2009. In the same timeframe, uncovered employment rose by 6.6 million. Inquiring minds might want to know what an “uncovered” job entails. Selling your accumulated Chinese crap on Ebay is an uncovered job. Calling yourself a consultant while sleeping until noon is an uncovered job. Day trading Facebook and Apple stock is an uncovered job. Trash picking is an uncovered job. The truth is that real jobs are 1.7 million lower than they were at the depths of the recession, while bullshit jobs paying virtually nothing and offering no benefits have surged by 6.6 million. These facts don’t make a great campaign commercial. The number of employed Americans is at the same level as mid-2005, even though the working age population has grown by 18 million. Since 2008 there are 3 million less full-time jobs and 3 more part-time jobs. This trend is accelerating as small businesses react rationally to the oncoming Obamacare train, resulting in aggregate work hours declining and wage growth stagnating.

Zero Hedge reveals more truth about our glorious jobs recovery with the following two charts. They obliterate the false narrative spun by liberal ideologues that the reason for the increase of those not in the labor force is due to Baby Boomers retiring. The truth is that while those in the 55-69 age brackets have gained nearly 4 million jobs under President Obama, everyone else has lost just over 2.5 million jobs. Is this a positive development or a sign of extreme desperation among older Americans who have seen their interest income vaporized by Ben Bernanke and there food, energy, and healthcare expenses skyrocket?

Those in their prime earning years of 25 to 54 still have a net cumulative loss of 2.2 million jobs since 2009. Recent college graduates, with their billions of student loan debt, have nabbed 400,000 TGI Fridays jobs, singing happy birthday to 3 year olds, with their newly minted college degrees. This is the “normal” healthy jobs market sold to the American public by the propagandists and politicians.

The final jobs chart that portrays the truth of what has been a decades’ long spiral downward paints a picture of a country that once created wealth through producing goods from the 1940s through 1970. Since 1970 we’ve degenerated into a debt creating country that consumes foreign produced goods and makes entitlement promises it can never keep. Selling houses to each other, peddling crap on Ebay, and eating out three times a week has shockingly failed to propel our economy. The jobs picture has deteriorated rapidly since 2008 and is not improving, despite the best propaganda money can buy. There is absolutely no chance of any substantive improvement over the next four years based on the policies in place and refusal to acknowledge the economic realities that we face.

The accumulation of material possessions through the use of consumer debt, peddled by bankers and reinforced through relentless corporate marketing propaganda has left the country’s citizens weary, miserable, greedy, indebted and sick. Our obsession with technology has merely provided another means of distracting ourselves from confronting the dire challenges that must be addressed. We can ignore the facts but that doesn’t mean they do not exist. The abnormality that grips this nation is breathtaking to behold, as the status quo cheer on and encourage consumers to buy more things with money they don’t have in order to support an economic recovery that is dependent upon zero interest rates for Wall Street banks, QE to infinity, and the delusional desire for a miraculous return to the good old days when getting something for nothing was possible. We can no longer deny reality. If we want to add 30 million people to Medicaid, it must be paid for. If we want to wage never ending wars and police the world, it must be paid for. If we want a Federal government to spend $3.8 trillion per year, it must be paid for. Nothing is free in this world, but more than 50% of Americans seem to believe that to be true.

“Our economy is based on spending billions to persuade people that happiness is buying things, and then insisting that the only way to have a viable economy is to make things for people to buy so they’ll have jobs and get enough money to buy things.” – Philip Elliot Slater

We are seen by those in control as nothing more than common house flies caught in their web of lies. Your owners don’t care about you. They only care about their own wealth and power. They want to control and manipulate you. They want to keep you enslaved in debt and running on the treadmill of consumption. They want passive, non-critical thinking drones to do the menial service jobs that remain in this country, while they use their control of our financial, political, tax, and legal systems to ransack and pillage the wealth of the dwindling middle class. The truth is the continuation of our current economic system is mathematically impossible. Your owners know this. This is why the use of propaganda, misinformation, fake data, and false storylines has taken on astronomical proportions. The time for passivity and accepting the deceitfulness of our leaders is coming to an end. While you’re waiting in line this Christmas season at Wal-Mart to purchase a fabulously priced shirt that only required the deaths of 112 Bangladesh slave laborers, try to figure out how we got here. Your owners think they have you by the balls.

“They spend billions of dollars every year lobbying to get what they want. Well, we know what they want; they want more for themselves and less for everybody else. But I’ll tell you what they don’t want—they don’t want a population of citizens capable of critical thinking. They don’t want well informed, well educated people capable of critical thinking. They’re not interested in that. That doesn’t help them. That’s against their interest. You know something, they don’t want people that are smart enough to sit around their kitchen table and figure out how badly they’re getting fucked by a system that threw them overboard 30 fucking years ago. Because the owners of this country know the truth, it’s called the American Dream, because you have to be asleep to believe it.” – George Carlin

How many Americans are awake enough to handle the truth?

All I want for Christmas is the truth.

DECLINE, DECAY, DENIAL, DELUSION, & DESPAIR

The majority of Americans seem OK with just waddling through life, accepting the lies and misinformation blasted from the boob tube and their various iGadgets by their owners, gorging themselves to death on Twinkies and Cheetos, paying 15% interest on their $10,000 rolling credit card balance, and growing ever more dependent on the welfare/warfare state to provide and protect them from accepting personal responsibility for their lives. A minority of critical thinking people have chosen to question everything they see and hear being spewed at us by the propagandist mainstream media, the corporate fascist government, and the powerful banking cabal that has an iron grip upon our throats as they choke the life out of the global economy in their never ending desire for more riches and more power.

The decline of the Great American Empire cannot be attributed to one factor or one bogeyman. There are a multitude of factors, villains, and choices made by the American people that have led to our moral, civil, social, and economic decline. The kabuki theater that passes for our electoral process is little more than a diversion from our imminent fate. Neither candidate for President has any intention of changing the course of the U.S. Titanic. Our rendezvous with destiny has been charted, and there aren’t nearly enough lifeboats. Those who built the ship and recklessly navigated it into a sea of icebergs will be the 1st into the few lifeboats. The leaders we’ve chosen, the choices we’ve made, and our unwillingness to deal with facts and reality have set in motion a disaster that cannot be averted. It’s a shame the majority of Americans have the math aptitude of a 6th grader, because the unsustainability of our empire can be calculated quite easily. Math is hard for Americans, but denial and delusion are easy.      

Oddly, a couple of late September days in Wildwood NJ were able to crystalize many of the aspects of our cultural and economic decline in my mind. I should have just enjoyed the 72 degree temperatures, a few beers, and the freedom to read a book on my deck. I wish I was just oblivious to my surroundings, but my weekend in Wildwood NJ was an eye opener. Everywhere I turned I saw something that made me laugh, shake my head in disgust, or wonder how our government could have become so inane, incompetent and out of control. We all generalize based upon our preconceived beliefs, but sometimes what you see is what you get. The weekend started normally with a morning bike ride on the boardwalk with my wife and son to the Hereford lighthouse in North Wildwood. Along the way we passed the usual suspects on the boardwalk: the obese, the tattooed, the pierced, and the blue haired. I wish I was exaggerating, but I saw a dozen hoveround and rascal scooters carrying extremely obese Americans on par with this person:

 

If I wanted to be politically correct, I’d call the fat asses cruising on their “free” rascal scooters, the weight challenged disabled on their powered mobility enhancement vehicles. You know a trend has become a massive scam, when South Park dedicates an entire show to the shame of obesity and the scooter brigade. The majority of the scooter squad jamming up the boardwalk was less than 50 years old. They weren’t disabled. They were just too obese and lazy to wobble down the boardwalk to the next junk food joint. They were certainly in the right place. The Wildwood boardwalk is home to pizza topped with cheese fries, chocolate covered bacon, fried Oreos, funnel cake topped with powdered sugar, and 64 ounce sugar laced lemonade. The place would make Nanny Bloomberg’s head explode.

   

 

We’ve all seen the commercials for the Scooter store urging anyone on Medicare to rush in and get a power scooter or wheelchair “at little or no cost to you”. The entitlement “free shit” mentality permeates our culture. There is a cost and it is over $800 million per year, paid for by the 53% who pay Federal taxes.  Records from the Centers for Medicare and Medicaid Services show that the cost of motorized scooters and wheelchairs to the government health service for senior citizens rose 179% between 1999 and 2009, the last year for which full records are available. This data is fascinating as the number of Americans over the age of 65 only increased by 18% over this same time frame. The bill in 1999 was $259 million; in 2009 it was $723 million – and is surely over $1 billion today. This is another billion dollar scam being funded by your tax dollars, but there are no spending cuts possible according to our beloved Congressmen.

A recent report by Medicare’s inspector general also showed that 61% of the motorized wheelchairs provided to Medicare recipients in the first half of 2007 went to people who didn’t qualify for them. (Only people who cannot get around without one are supposed to be eligible.) The inspector general found that Medicare is billed an average of $4,018 for a motorized wheelchair that normally sells for $1,048. As a taxpayer, you will be shocked to find out that people are selling their “no cost” Rascal 600 B mobility scooters on eBay. I’m sure the keen eyed government drones working in the Health & Human Services agency are policing the resale of taxpayer paid for scooters. I find it amusing that scooters have various naming classes, just like BMW and Mercedes. The vast majority of people I see tooling around on their “mobility scooters” are just plain fat. They aren’t over 65 years old. On my Sunday bike ride I was flabbergasted and amused by the sight of a 350 pound woman on a Rascal with the pedal to the metal pulling a 275 pound man in a wheelchair attached by rope. The plague of slow metabolism is sweeping the countryside.    

 

While I was relaxing on my deck reading and trying to blot out the nightmare visions of obese boomers in Rascal formation like German panzers invading Poland, a brand new SUV pulled into the parking lot across the street. After five minutes, the driver’s side door opened and out sidled a four foot five, two hundred and fifty pound female senior citizen in all her girth. She waddled to the back of the SUV and opened the hatch to extract her walker with wheels. She began berating the three hundred pound dude that got out of the passenger side to come and get his walker. Then she motored off towards Laura’s Fudge, while her hubby conserved his energy waiting by the SUV. Minutes later she scooted her way back hauling a sack of fudge. They then trundled off towards the boardwalk, most likely headed for Kohrs Bros for a double dipped fudge ice cream cone or some Boardwalk fries smothered in cheese.   

  

Based upon my unscientific assessment of the people walking on the Wildwood boardwalk, I would conclude that 35% of the people are obese, 40% are overweight by 20 or 30 pounds (myself included), and 25% are in relatively good shape. After checking the government statistics, my assessment appears to be accurate. Who is to blame? The easy answer is to just blame the individual for their lack of self-restraint and inability to contain their impulses. But when you consider that 160 million out of 232 million adults in this country are either overweight or obese, along with 11 million adolescents, there must be something more sinister behind the phenomenon. There is no doubt that a major portion of the blame must be laid at the fat feet of those who could have exercised restraint over their cravings, but the words of master propagandist Edward Bernays provides another factor in the equation:

“If we understand the mechanism and motives of the group mind, it is now possible to control and regiment the masses according to our will without them knowing it.” – Edward Bernays

     

Bernays reveals a truth that is self-evident to those with critical thinking skills. Sadly, few Americans exhibit any thinking skills whatsoever. Our society has bifurcated into those who control and those who are controlled. The overlord Double Plus Alphas in our society consist of the Wall Street banker cabal, the executives of our mega-corporations, Federal Reserve governors, Washington DC politicians, Federal government apparatchiks, the propaganda experts in the mainstream corporate media, and the secretive billionaire set that manipulate and maneuver behind the scenes. The first step in controlling the Gammas, Deltas and Epsilons, as Aldous Huxley knew in 1931, was to indoctrinate them with propaganda in our government run schools. This mission has been accomplished. The vast majority of school children graduate from the government school system with no ability to think critically or question what has been spoon fed to them as facts. The fascist alliance of corporations and the state begin in the public schools, with product advertisements by corporations now subsidizing school budgets. The road to obesity is paved with chicken nuggets, fries and pizza dispensed by the government schools on a daily basis.

Just as in Huxley’s Brave New World, America has been built upon the principles of Henry Ford’s assembly line—mass production, homogeneity, predictability, and consumption of disposable consumer goods. In the dystopian novel, members of every class, from birth, are indoctrinated by recorded voices repeating slogans while they sleep. Huxley didn’t imagine the power of TV and other mass media outlets to do the same while we are awake. We are bombarded day and night by propaganda from mega-corporations to buy their products. Mass consumption of processed food sold by the likes of multi-billion dollar corporations Kraft, Pepsico, Coca Cola, General Mills, Nestle, and Unilever is the chief cause of the obesity epidemic in America. The few know how to manipulate the many through messaging, repetition and persistently molding the opinions of the feeble minded non-thinking masses. The billions spent by corporations on advertising to convince the masses that eating a Wendy’s Baconator, KFC extra crispy bucket, or Double Quarter Pounder with Cheese, washed down with a two liter Mountain Dew or Cherry Coke, is a tribute to the invisible government running the show. Huxley and Bernays had it all figured out eighty years ago:            

“The conscious and intelligent manipulation of the organized habits and opinions of the masses is an important element in democratic society. Those who manipulate this unseen mechanism of society constitute an invisible government which is the true ruling power of our country. …We are governed, our minds are molded, our tastes formed, our ideas suggested, largely by men we have never heard of. This is a logical result of the way in which our democratic society is organized. Vast numbers of human beings must cooperate in this manner if they are to live together as a smoothly functioning society. In almost every act of our daily lives, whether in the sphere of politics or business, in our social conduct or our ethical thinking, we are dominated by the relatively small number of persons…who understand the mental processes and social patterns of the masses. It is they who pull the wires which control the public mind.” – Edward Bernays, Propaganda, 1928

The conscious and intelligent manipulation of the masses by the invisible government Alphas has transmuted citizens into overweight, non-thinking, debt dependent, egocentric consumers. This was not a mistake. The powerful interests used their control over the banking system, media outlets, and political system to lure the willfully ignorant into a debt financed lifestyle through the Federal Reserve created inflation, Wall Street peddled credit cards, auto loans and “creative” mortgages. The manipulators convinced the manipulated that borrowing today to buy houses, cars, bling, tech gadgets, clothing, and fast food was preferable to what previous generations of Americans had done – save to buy things they wanted or needed. This behavior seems to be completely irrational as a people that once saved 12% of their income and carried a moderate amount of debt chose to reduce their savings to 0% and not worry about tomorrow.

 

It is easier to understand when you realize who benefitted from this purposeful shift in societal norms. The low debt, high savings, production era from 1950 through 1980 benefitted the working middle class, allowing millions to improve their standard of living. The rising debt, low savings, consumption era, from 1980 through today, benefits the 1% Alphas while impoverishing the middle class and sentencing the lower class to a lifetime of dependent servitude to the state. Who benefitted from debt fueled conspicuous consumption and continues to benefit today? The peddlers of consumer debt on Wall Street and the mega-corporations that convinced Americans they couldn’t live without that 5,500 square foot McMansion, BMW X5, stainless steel appliances, 84 inch 3D HDTV, iPhone 5, diamond encrusted Coach handbag, and thousands of other Chinese made trinkets that pile up in underwater homes across the land, benefitted tremendously. The proliferation of debt resulted in obscene profits for the financial sector, record profits for the mega-corporations that shipped production to Asia in order to take advantage of the slave labor, and three decades of wage stagnation and increasing debt for the average working middle class American.    

 

The financialization of America was a conscious decision by the oligarchs. They controlled the issuance of credit. They controlled the currency and level of inflation inflicted upon the masses. They controlled the corporations selling consumer goods on credit. They controlled the Congress, courts, and government agencies with their deep pocket lobbying and buying of influence. Lastly, they controlled the media messages and molded the opinions and tastes of the masses through their Bernaysian propaganda techniques perfected over the decades. In one of the boldest and most blatant acts of audacity in world history, the Wall Street/K Street oligarchs wrecked the world economy in their insatiable thirst for profits, shifted their worthless debt onto the backs of taxpayers and unborn generations, threw senior citizens and savers under the bus by stealing $400 billion per year of interest from them, and enriched themselves with bubble level profits and bonus payouts. Meanwhile, median household income continues to fall, real GDP is stagnant, true unemployment exceeds 22%, and 47 million people are living on food stamps.   

 

The propaganda being flogged by the oligarchs since 2009 is the supposed deleveraging by the American consumer and trying to convince the ignorant masses to resume borrowing and spending. It’s working. Consumer credit outstanding is at an all-time high of $2.73 trillion as the Federal government has dished out billions in student loans to 50,000 University of Phoenix MBA aspirants sitting in their basements quivering with anticipation of on-line graduation and future six figure job with Goldman Sachs. The Feds have also added the impetus to the “strong” auto sales through their 85% TARP ownership of Ally Financial by doling out 7 year 0% auto loans to subprime borrowers in urban enclaves around the country. The oligarchs aren’t worried about these loans being paid back, because they are reaping the profits today. The future losses will just be foisted onto the taxpayer, as always. Total credit market debt of $55 trillion now exceeds 350% of GDP. The National Debt of $16.2 trillion will exceed $20 trillion in 2015 no matter who wins the Presidency in November. The oligarchs adapt and control whoever occupies the White House. It is essential for our owners to keep debt growing at an exponential rate or the Ponzi scheme collapses.

Narrow minded ideologues want a simple answer to a complex interaction of generational, cultural, economic, political, and criminal factors that have conspired to put the country into a predicament that, at this point, will inevitably lead to economic collapse. The truth is the American people have learned to love their servitude. They have willfully chosen ignorance over truth. They’ve chosen to believe what their keepers have instructed them. They’ve chosen to trust the storylines generated by the corporate media rather than think critically and question everything. They’ve chosen obesity and sickness over health. They’ve chosen debt financed faux wealth over savings based real wealth. They’ve chosen safety and security over liberty. They’ve chosen dependency over self-reliance. These choices were aided, abetted and promoted by the Alphas through their ability to manipulate and control the unthinking masses. Huxley understood the power of propaganda and brainwashing decades before it was perfected by our owners.  

“There will be, in the next generation or so, a pharmacological method of making people love their servitude, and producing dictatorship without tears, so to speak, producing a kind of painless concentration camp for entire societies, so that people will in fact have their liberties taken away from them, but will rather enjoy it, because they will be distracted from any desire to rebel by propaganda or brainwashing, or brainwashing enhanced by pharmacological methods. And this seems to be the final revolution.” – Aldous Huxley

The saddest part of this episode of the Decline & Fall of the American Empire reality show is the continued delusion of the majority of the populace, as their desire for material goods and fair share of the entitlement pie outweighs their sense of obligation to their children and grandchildren. Their chosen ignorance is fulfilled through their attachment to their personal digital ignorance gadgets and supported by what passes for government education. The truth is obscured and hidden under waves of triviality, reality TV, and data manipulation by our government masters. The dystopian nightmare that engulfs our country has thus far resembled Huxley’s vision of a shallow populace easily distracted by consumerism, pleasure seeking, cultural trivialities, and a never ending ability to be distracted by meaningless minutia. Orwell’s darker vision of surveillance, captivity, information control, authoritarianism and pain will become the norm once the existing social order falls.   

“What Orwell feared were those who would ban books. What Huxley feared was that there would be no reason to ban a book, for there would be no one who wanted to read one. Orwell feared those who would deprive us of information. Huxley feared those who would give us so much that we would be reduced to passivity and egotism. Orwell feared that the truth would be concealed from us. Huxley feared the truth would be drowned in a sea of irrelevance. Orwell feared we would become a captive culture. Huxley feared we would become a trivial culture, preoccupied with some equivalent of the feelies, the orgy porgy, and the centrifugal bumblepuppy. As Huxley remarked in Brave New World Revisited, the civil libertarians and rationalists who are ever on the alert to oppose tyranny “failed to take into account man’s almost infinite appetite for distractions.” In 1984, Orwell added, people are controlled by inflicting pain. In Brave New World, they are controlled by inflicting pleasure. In short, Orwell feared that what we fear will ruin us. Huxley feared that our desire will ruin us.” – Neil Postman – Amusing Ourselves to Death

I despair for my country that has chosen to eat, amuse and borrow itself to death. But my despair is deepest for my children and their future. The greed, corruption, myopia, selfishness, and disregard for the well-being of future generations by current and past generations has left a barren and bleak landscape for my children. The Huxley vision of America consuming and amusing itself to death is coming to a painful conclusion, as the limits of a fiat currency and debt based lifestyle become evident. Those in power are preparing the masses for a more Orwellian vision of America when they are forced to pull the plug on the existing paradigm. The Patriot Act, NDAA, military exercises in our cities, militarization of local police forces, warrantless surveillance of our communications, searches and seizures in our airports and train stations, purchase of millions of rounds of ammo by government agencies, implementation of drone technology, camera surveillance, attempts to control the internet, manipulation of economic data, and executive orders allowing the President to take over all commerce while imprisoning citizens indefinitely without charges, are the next step in our descent into a dictatorship of tears.

The question is whether we will stand idly by, fiddling with our gadgets, tweeting about Honey Boo Boo, or will we regain our sense of duty to the future generations of this country. The manipulators are powerful, rich, connected and FEW. Those being manipulated, controlled, and abused are MANY. There will be a revolution in this country whether you like it or not. The existing social order will dissolve during the next fifteen years. What replaces it is up to us. George Carlin described what our owners want.

“Politicians are put there to give you that idea that you have freedom of choice. You don’t. You have no choice. You have owners. They own you. They own everything. They own all the important land, they own and control the corporations, and they’ve long since bought and paid for the Senate, the Congress, the State Houses, and the City Halls. They’ve got the judges in their back pockets. And they own all the big media companies so they control just about all the news and information you get to hear.

They’ve got you by the balls.

They spend billions of dollars every year lobbying to get what they want. Well, we know what they want; they want more for themselves and less for everybody else. But I’ll tell you what they don’t want—they don’t want a population of citizens capable of critical thinking. They don’t want well informed, well educated people capable of critical thinking. They’re not interested in that. That doesn’t help them. That’s against their interest.”

What do “We the People” want?      



 

QUOTES OF THE DAY – HUXLEY ON WAR, HISTORY & TRUTH

What is absurd and monstrous about war is that men who have no personal quarrel should be trained to murder one another in cold blood.
Aldous Huxley

 

The most shocking fact about war is that its victims and its instruments are individual human beings, and that these individual beings are condemned by the monstrous conventions of politics to murder or be murdered in quarrels not their own.
Aldous Huxley

 

The propagandist’s purpose is to make one set of people forget that certain other sets of people are human.
Aldous Huxley

 

 Facts do not cease to exist because they are ignored.
Aldous Huxley

 

Great is truth, but still greater, from a practical point of view, is silence about truth. By simply not mentioning certain subjects… totalitarian propagandists have influenced opinion much more effectively than they could have by the most eloquent denunciations.
Aldous Huxley

 

An unexciting truth may be eclipsed by a thrilling lie.
Aldous Huxley

 

Idealism is the noble toga that political gentlemen drape over their will to power.
Aldous Huxley

 

A democracy which makes or even effectively prepares for modern, scientific war must necessarily cease to be democratic. No country can be really well prepared for modern war unless it is governed by a tyrant, at the head of a highly trained and perfectly obedient bureaucracy.
Aldous Huxley

 

 

 

So long as men worship the Caesars and Napoleons, Caesars and Napoleons will duly arise and make them miserable.
Aldous Huxley

 

That men do not learn very much from the lessons of history is the most important of all the lessons of history.
Aldous Huxley

 

 The charm of history and its enigmatic lesson consist in the fact that, from age to age, nothing changes and yet everything is completely different.
Aldous Huxley

 
You shall know the truth, and the truth shall make you mad.
Aldous Huxley

One of the great attractions of patriotism – it fulfills our worst wishes. In the person of our nation we are able, vicariously, to bully and cheat. Bully and cheat, what’s more, with a feeling that we are profoundly virtuous.
Aldous Huxley

 

IT’S A MATTER OF TRUST – PART ONE

“All the world is made of faith, and trust, and pixie dust.” ― J.M. Barrie – Peter Pan

     

“The issue which has swept down the centuries and which will have to be fought sooner or later is the people versus the banks.” – Lord Acton

Who do you trust? Do you trust the President? Do you trust Congress? Do you trust the Treasury Secretary? Do you trust the Federal Reserve? Do you trust the Supreme Court? Do you trust the Military Industrial Complex? Do you trust Wall Street bankers? Do you trust the SEC? Do you trust any government agency or regulator? Do you trust the corporate mainstream media? Do you trust Washington think tanks? Do you trust Madison Avenue PR maggots? Do you trust PACs? Do you trust lobbyists? Do you trust government unions? Do you trust the National Association of Realtors? Do you trust mega-corporation CEOs? Do you trust economists? Do you trust billionaires? Do you trust some anonymous blogger? You can’t even trust your parish priest or college football coach anymore. A civilized society cannot function without trust. The downward spiral of trust enveloping the world is destroying our global economy and will lead to collapse, chaos and bloodshed. The major blame for this crisis sits squarely on the shoulders of crony capitalists that rule our country, but the willful ignorance and lack of civic accountability from the general population has contributed to this impending calamity. Those in control won’t reveal the truth and the populace don’t want to know the truth – a match made in heaven – or hell.

“Most ignorance is vincible ignorance. We don’t know because we don’t want to know.” – Aldous Huxley

The fact that 86% of American adults have never heard of Jamie Dimon should suffice as proof regarding the all-encompassing level of ignorance in this country. As the world staggers under the unbearable weight of debt built up over decades, to fund a fantasyland dream of McMansions, luxury automobiles, iGadgets, 3D HDTVs, exotic vacations, bling, government provided pensions, free healthcare that makes us sicker, welfare for the needy and the greedy, free education that makes us dumber, and endless wars of choice, the realization that this debt financed Ponzi scheme was nothing but a handful of pixie dust sprinkled by corrupt politicians and criminal bankers across the globe is beginning to set in. A law abiding society that is supposed to be based on principles of free market capitalism must function in a lawful manner, with the participants being able to trust the parties they do business with. When trust in politicians, regulators, corporate leaders and bankers dissipates, anarchy, lawlessness, unscrupulous greed, looting, pillaging and eventually crisis and panic engulf the system.

Our myopic egocentric view of the world keeps most from seeing the truth. Our entire financial system has been corrupted and captured by a small cabal of rich, powerful, and prominent men. It is as it always has been. History is filled with previous episodes of debt fueled manias, initiated by bankers and politicians that led to booms, fraud, panic, and ultimately crashes. The vast swath of Americans has no interest in history, financial matters or anything that requires critical thinking skills. They are focused on the latest tweet from Kim Kardashian about her impending nuptials to Kanye West, the latest rumors about the next American Idol judge or the Twilight cheating scandal.

Bubble, Bubble, Toil & Trouble

Economist and historian Charles P. Kindleberger in his brilliant treatise Manias, Panics, and Crashes details the sordid history of unwitting delusional peasants being swindled by bankers and politicians throughout the ages. Human beings have proven time after time they do not act rationally, obliterating the economic teachings of our most prestigious business schools about rational expectations theory and efficient markets. The only thing efficient about our markets is the speed at which the sheep are butchered by the Wall Street slaughterhouse. If humanity was rational there would be no booms, no busts and no opportunity for the Corzines, Madoffs, and Dimons of the world to swindle the trusting multitudes. The collapse of a boom always reveals the frauds and swindlers. As the tide subsides, you find out who was swimming naked.

“The propensity to swindle grows parallel with the propensity to speculate during a boom… the implosion of an asset price bubble always leads to the discovery of frauds and swindles”— Charles P. Kindleberger, economic historian

The historically challenged hubristic people of America always think their present-day circumstances are novel and unique to their realm, when history is wrought with similar manias, panics, crashes and criminality. Kindleberger details 38 previous financial crises since 1618 in his book, including:

  • The Dutch tulip bulb mania
  • The South Sea bubble
  • John Law Mississippi Company bubble
  • Banking crisis of 1837
  • Panic of 1857
  • Panic of 1873
  • Panic of 1907 – used as excuse for creation of Federal Reserve
  • Great Crash of 1929
  • Oil Shock of 1974-75
  • Asian Crisis of 1998

Kindleberger wrote his book in 1978 and had to update it three more times to capture the latest and greatest booms and busts. His last edition was published in 2000. He died in 2003. Sadly, he missed being able to document two of the biggest manias in history – the Internet bubble that burst in 2001 and the housing/debt bubble that continues to plague the world today. Every generation egotistically considered their crisis to be the worst of all-time as seen from quotes at the time:

  • 1837: “One of the most disastrous panics this nation ever experienced.”
  • 1857: “Crisis of 1857 the most severe that England or any other nations has ever encountered.”
  • 1873: “In 56 years, no such protracted crisis.”
  • 1929: “The greatest of speculative boom and collapse in modern times – since, in fact, the South Sea Bubble.”

Human beings have not changed over the centuries. We are a flawed species, prone to emotional outbursts, irrational behavior, alternately driven by greed and fear, with a dose of delusional thinking and always hoping for the best. These flaws will always reveal themselves because even though times change, human nature doesn’t. The cyclical nature of history is a reflection of our human foibles and flaws. The love of money, power, and status has been the driving force behind every boom and bust in history, as noted by historian Niall Ferguson.

“If the financial system has a defect, it is that it reflects and magnifies what we human beings are like. Money amplifies our tendency to overreact, to swing from exuberance when things are going well to deep depression when they go wrong. Booms and busts are products, at root, of our emotional volatility.” –  Niall Ferguson

Not only are our recent booms and busts not unique, but they have a common theme with all previous busts – greedy bankers, excessive debt, non-enforcement of regulations, corrupt public officials, rampant fraud, and unwitting dupes seeking easy riches. Those in the know use their connections and influence to capture the early profits during a boom, while working the masses into frenzy and providing the excessive leverage that ultimately leads to the inevitable collapse. As the bubble grows, rationality is thrown out the window and all manner of excuses and storylines are peddled to the gullible suckers to keep them buying. Nothing so emasculates your financial acumen as the sight of your next door neighbor or moronic brother-in-law getting rich. As long as all the participants believe the big lie, the bubble can inflate. As soon as doubt and mistrust enter the picture, someone calls a loan or refuses to be the greater fool, and panic ensues. This is when the curtain is pulled back on the malfeasance, frauds, deceptions and scams committed by those who engineered the boom to their advantage. As Kindleberger notes, every boom ends in the same way.

“What matters to us is the revelation of the swindle, fraud, or defalcation. This makes known to the world that things have not been as they should have been, that it is time to stop and see how they truly are. The making known of malfeasance, whether by the arrest or surrender of the miscreant, or by one of those other forms of confession, flight or suicide, is important as a signal that the euphoria has been overdone. The stage of overtrading may well come to an end. The curtain rises on revulsion, and perhaps discredit.” – Charles P. Kindleberger – Manias, Panics, and Crashes

When mainstream economists examine bubbles, manias and crashes they generally concentrate on short-term bubbles that last a few years. But some bubbles go on for decades and some busts have lasted for a century. The largest bubble in world history continues to inflate at a rate of $3.8 billion per day and has now expanded to epic bubble proportions of $15.92 trillion, up from $9.65 trillion in September 2008 when this current Wall Street manufactured crisis struck. A 65% increase in the National Debt in less than four years can certainly be classified as a bubble. We are currently in the mania blow off phase of this bubble, but it began to inflate forty years ago when Nixon closed the gold window. This unleashed the two headed monster of politicians buying votes with promises of unlimited entitlements for the many, tax breaks for the connected few and pork projects funneled to cronies, all funded through the issuance of an unlimited supply of fiat currency by a secretive cabal of central bankers running a private bank for the benefit of other bankers and their politician puppets. Crony capitalism began to hit its stride after 1971.

The apologists for the status quo, which include the corporate mainstream media, intellectually dishonest economist clowns like Krugman, Kudlow, Leisman, and Yun, ideologically dishonest think tanks funded by billionaires, and corrupt politicians of both stripes, peddle the storyline that a national debt of 102% of GDP, up from 57% in 2000, is not a threat to our future prosperity, unborn generations or the very continuance of our economic system. They use the current historically low interest rates as proof this Himalayan Mountain of debt is not a problem. Of course it is a matter of trust and faith in the ability of a few ultra-wealthy, sociopathic, Ivy League educated egomaniacs that their brilliance and deep understanding of economics that will see us through this little rough patch. The wisdom and brilliance of Ben Bernanke is unquestioned. Just because he missed a three standard deviation bubble in housing and didn’t even foresee a recession during 2008, doesn’t mean his zero interest rate/screw grandma policy won’t work this time. It’s done wonders for Wall Street bonus payouts.

The growth of this debt bubble is unsustainable, as it is on track to breach $20 trillion in 2015. The only thing keeping interest rates low is coordinated manipulation by Ben and his fellow sociopathic central bankers, the insolvent too big to fail banks using derivative weapons of mass destruction, and politicians desperately attempting to keep the worldwide debt Ponzi scheme from imploding on their watch. Their “solution” is to kick the can down the road. But there is a slight problem. The road eventually ends.

At some point a grain of sand will descend upon a finger of instability in the sand pile and cause a collapse. No one knows which grain of sand will trigger the crisis of confidence and loss of trust. But with a system run by thieves, miscreants, and scoundrels, one of these villains will do something dastardly and the collapse will ensue. Ponzi schemes can only be sustained as long as there are enough new victims to keep it going. As soon as uncertainty, suspicion, fear and rational thinking enter the equation, the gig is up. Kindleberger lays out the standard scenario, as it has happened numerous times throughout history.

“Causa remota of the crisis is speculation and extended credit; causa proxima is some incident that snaps the confidence of the system, makes people think of the dangers of failure, and leads them to move from commodities, stocks, real estate, bills of exchange, promissory notes, foreign exchange – whatever it may be – back into cash. In itself, causa proxima may be trivial: a bankruptcy, suicide, a flight, a revelation, a refusal of credit to some borrower, some change of view that leads a significant actor to unload. Prices fall. Expectations are reversed. The movement picks up speed. To the extent that speculators are leveraged with borrowed money, the decline in prices leads to further calls on them for margin or cash and to further liquidation. As prices fall further, bank loans turn sour, and one or more mercantile houses, banks, discount houses, or brokerages fail. The credit system itself appears shaky, and the race for liquidity is on.” – Charles P. Kindleberger – Manias, Panics, and Crashes

Despite centuries of proof that human nature will never change, there are always people (usually highly educated) who think they are smart enough to fix the markets when they breakdown and create institutions, regulations and mechanisms that will prevent manias, panics and crashes. These people inevitably end up in government, central banks and regulatory agencies. Their huge egos and desire to be seen as saviors lead to ideas that exacerbate the booms, create the panic and prolong the crashes. They refuse to believe the world is too complex, interconnected and unpredictable for their imagined ideas of controlling the levers of economic markets to have a chance of success. The reality is that an accident may precipitate a crisis, but so may action designed to prevent a crisis or action by these masters of the universe taken in pursuit of other objectives. Examining the historical record of booms and busts yields some basic truths. The boom and bust business cycle is the inevitable consequence of excessive growth in bank credit, exacerbated by inherently damaging and ineffective central bank policies, which cause interest rates to remain too low for too long, resulting in excessive credit creation, speculative economic bubbles and lowered savings.

Low interest rates tend to stimulate borrowing from the banking system. This expansion of credit causes an expansion of the supply of money through the money creation process in our fractional reserve banking system. This leads to an unsustainable credit-sourced boom during which the artificially stimulated borrowing seeks out diminishing investment opportunities. The easy credit issued to non-credit worthy borrowers results in widespread mal-investments and fraud. A credit crunch leading to a bust occurs when exponential credit creation cannot be sustained. Then the money supply suddenly and sharply contracts as fear and loathing of debt replace greed and worship of debt. In theory, markets should clear through liquidation of bad debts, bankruptcy of over-indebted companies and the failure of banks that made bad loans. Sanity is restored to the marketplace through failure, allowing resources to be reallocated back towards more efficient uses. The housing boom and bust from 2000 through today perfectly illustrates this process. Of course, Bernanke declared housing to be on solid footing in 2007.

The housing market has not been allowed to clear, as Bernanke has artificially kept interest rates low, government programs have created false demand, and bankers have shifted their bad loans onto the backs of the American taxpayer while using fraudulent accounting to pretend they are solvent. Our owners are frantically attempting to re-inflate the bubble, just as they did in 2003. Our deepest thinkers, like Greenspan, Krugman, Bush, Dodd, and Frank knew we needed a new bubble after the Internet bubble blew up in their faces and did everything in their considerable power to create the first housing bubble. If at first you don’t succeed, try, try again.

Human nature hasn’t changed in centuries. We have faith that humanity has progressed, but the facts prove otherwise. We are a species susceptible to the passions of power, greed, delusion, and an inflated sense of our own intellectual superiority. And we still like to kill each other in the name of country and honor. There is nothing progressive about crashing the worldwide economic system and invading countries for “our” oil.

History has taught that there will forever be manias, bubbles and the subsequent busts, but how those in power deal with these episodes has been and will be the determining factor in the future of our economic system and country.

Humanity is deeply flawed; the average human life is around 80 years; men of stature, wealth, over-confidence in their superior intellect, and egotistical desire to leave their mark on history, always rise to power in government and the business world; this is why history follows a cyclical path and the myth of human progress is just a fallacy.

“That men do not learn very much from the lessons of history is the most important of all the lessons that History has to teach” – Aldous Huxley

In Part 2 of this three part series I will examine the one hundred year experiment of trusting a small cabal of non-elected bankers to manage and guide our economic system for the benefit of the American people.

 

 

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BAD WEEK FOR FREEDOM

“We have two American flags always: one for the rich and one for the poor. When the rich fly it means that things are under control; when the poor fly it means danger, revolution, anarchy.”– Henry Miller

  




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With each passing week it seems this country spirals further into the depths of a frightening dystopian fantasy reminiscent of Huxley and Orwell’s dark world of isolation, fear and government brutality portrayed in their masterpieces Brave New World and 1984. I keep speculating whether it’s me that’s crazy and not the things I’m witnessing on a daily basis. The President signs the National Defense Authorization Act, passed by an overwhelming majority of Congress, which allows the government to imprison American citizens indefinitely without charge. And there is barely a squeak from the docile masses as they are soothed by Obama promising to never use that part of the law. I bet you $10,000 a President will invoke that portion of the NDAA in the very near future.

Jon Corzine, a card carrying member of the ruling elite .01%, remains free to roam one of his five palatial estates after stealing $1.6 billion from the accounts of farmers, widows, and thousands of other “clients” of MF Global. In his spare time he raises money for Obama’s re-election campaign. The Federal government, Federal courts and Wall Street banking cabal have circled the wagons and declared the money just vaporized, even though it sits in Jamie Dimon’s vaults at J.P. Morgan. No one is being prosecuted for this deliberate thievery. The psychopathic Wall Street criminals have been getting away with murder for so long they act invulnerable to societal mores and scoff at our laws, rules and regulations. Those are for the 99%. When you control the politicians, regulators, courts, and mainstream media, it’s easy to get away with murder. The jackals and hyenas are laughing in their NYC penthouse suites as they continue to collect $20 million bonuses for a job well done.

 

After this past week I’m apoplectic with rage and fury as the rule of law has been discarded and the Constitution trampled upon by a wealthy connected oligarchy bent upon using their absolute power to further enrich themselves. The Wall Street banks that committed the largest financial crime in history, including: fraud in the inducement, forgery, fabricating documents, bribing rating agencies to rate toxic mortgages as AAA, selling fraudulent derivatives to customers, shorting the derivatives they sold to their customers, throwing millions of Americans out of their homes, charging inflated and bogus fees during the foreclosure process, and conducting a colossal cover-up, were slapped on the wrist and made to pay a miniscule $5 billion to the millions of victims of their crimes. Not one banker has been prosecuted. Not one person has gone to jail. Justice in this country is a putrid joke. There has been no outrage from the general public. The propaganda spewed by the corporate media instructs the masses to rejoice at this fair and just verdict. The truth is that 95% of the population didn’t know or didn’t care about the 50 state foreclosure-gate settlement. They were engrossed by the huge controversy over M.I.A. flipping the bird during the Super Bowl halftime show and whether Madonna was upset about the incident.

“Free” Healthcare

While this travesty of justice was playing out, we were treated to a glimpse into the future of healthcare in America administered by politicians and bureaucrats based upon vote count expediency. The government drones at DHHS mandated from on high that every woman in America would receive “free” contraceptives from their employers. Obama had made this decision and instructed his minions to implement his visionary dictate. The outrage and anger from religious groups and employers was instantaneous. Obama saw the 2012 election slipping away and reversed course within a day. He is quite the man of principle. His “solution” was to force insurance companies to provide “free” contraception to any employee of a religious employer that didn’t provide that coverage in their insurance plan. When I hear these sociopathic politicians use the word “free” when describing healthcare or any of their thousands of bankrupt government programs, I have an overpowering impulse to smash something. Insurance companies will not provide “free” contraceptives to women. Insurance premiums will rise for everyone.

Remember Obama’s assertion about his government takeover of healthcare:

“As a consequence of the Affordable Care Act, premiums are going to be lower than they would be otherwise; health care costs overall are going to be lower than they would be otherwise.”

The next government program that reduces costs, provides better service, and is more efficient than the private market will be the first government program to do so. Examples of government ineptitude, corruption and waste include: Social Security, Medicare, Welfare, the Energy Dept., the Education Dept., and the Dept. of War. Jonathan Gruber, MIT economist and chief architect of Obamacare and Romneycare, recently admitted the truth about Obamacare:

“After the application of tax subsidies, 59% of the individual market will experience an average premium increase of 31%. My findings reflect the high cost of folding state high risk pools into the [federal government’s] exchange — without using the money the state was already spending to subsidize those high risk pools.”

Based on what Obamacare has done for the American people before its full implementation in 2014, you’ll be begging for a death panel to put you out of your misery. The following “free” healthcare services were required to be covered by insurance companies in 2010:

  • Cover preventive care without co-pays or deductibles.
  • Allow adult children to stay on parents’ policies until age 26.
  • Increase annual coverage limits.
  • Cover children without regard for preexisting conditions.

Obama’s promise that families would save $2,500 per year in the future might come up a tad short, as insurance premiums skyrocketed by 9% in 2011. Not only have premiums soared, but many companies have increased co-pays from $10 to $25 for doctor visits.

Source: Kaiser Family Foundation

Only a deceitful government busybody do-gooder would actually argue that forcing insurance companies to cover millions more Americans and cover pre-existing conditions would result in lower costs for the average family. I wonder what will happen in 2014 when 30 million more Americans are guaranteed “free” healthcare under Obamacare. The saddest part of this oncoming train wreck is that millions of willfully ignorant people actually believed the blatant lies and false storyline fed to them by sociopathic politicians who desire to control every aspect of their lives. These people believe they know what is best for you. They believe they are smarter than you. They do not care what means are required to achieve their ends of absolute domination over your life. Personal freedom, individual liberty and a critical thinking populace are the antithesis to the desires of the governing elite.

Home Sweet Home

The central planners within government and inhabiting the Federal Reserve are never in doubt that their theories, programs, solutions, mandates and schemes will achieve their desired outcome. The trouble for the American people is the desired result is not designed or planned to actually benefit them. The psychopaths drawn to politics, regulatory agencies, and government bureaucracies have no remorse or qualms about lying, utilizing propaganda, and instilling fear to achieve the ends that endorse their self serving agenda. Every dime of government spending is seized from the people by force or created out of thin air by an all knowing self-proclaimed Great Depression expert named Ben Bernanke. This Ivy League professor who has spent his entire life in academia and government thinks he knows which levers to pull to revive an economy that he destroyed. His wisdom is borne out in his prescient assessment of the U.S. housing market as it was imploding:

“We’ve never had a decline in house prices on a nationwide basis. So, what I think what is more likely is that house prices will slow, maybe stabilize, might slow consumption spending a bit. I don’t think it’s gonna drive the economy too far from its full employment path, though.” – July 2005

“House prices have risen by nearly 25 percent over the past two years. Although speculative activity has increased in some areas, at a national level these price increases largely reflect strong economic fundamentals.” – October 2005

“Housing markets are cooling a bit. Our expectation is that the decline in activity or the slowing in activity will be moderate, that house prices will probably continue to rise.” – February 2006

“All that said, given the fundamental factors in place that should support the demand for housing, we believe the effect of the troubles in the subprime sector on the broader housing market will likely be limited, and we do not expect significant spillovers from the subprime market to the rest of the economy or to the financial system.  The vast majority of mortgages, including even subprime mortgages, continue to perform well.  Past gains in house prices have left most homeowners with significant amounts of home equity, and growth in jobs and incomes should help keep the financial obligations of most households manageable.” – May 2007

It should be clear to everyone that Ben is a goddamn genius. You can see why the mainstream corporate media hangs on his every utterance. He has accepted no responsibility for his part in producing an epic housing collapse and the subsequent recession that continues to this day. His lack of conscience comes in handy as he has destroyed the finances of millions of senior citizens dependent upon interest income to make ends meet. Having no guiding principles or ethics allows him to declare with a straight face that inflation is well contained as gas prices approach $4.00 per gallon, food prices surge 10%, and his inflationary policies contribute to revolutions around the globe.

Last week this sage spoke to the Home Builders Association and left no doubt that he has no interest in what is best for the American people. His economic remedies are the exact opposite of what is needed to cure the disease of a debt ravaged society. Dr. Bernake’s prescription is more debt fueled spending by consumers to refill the coffers on Wall Street. This is not surprising considering he is nothing but a puppet of Dimon, Pandit, Blankfein and the rest of the Wall Street cabal. His speech revealed his allegiances:

“One of the effects of declines in housing wealth is to reduce the ability and willingness of households to spend. It appears that recent declines in housing wealth may be reducing consumer spending between $200 billion and $375 billion per year. That reduction corresponds to lower living standards for many Americans. And, importantly, lower sales of goods and services also reduce the incentives of firms to invest and hire, thereby slowing the recovery. Low or negative equity creates additional problems for households. It reduces financial flexibility: Homeowners who are underwater on their mortgages cannot tap home equity to pay for emergency health expenses or their children’s college educations.”

Whenever I read Bernanke’s words, I’m reminded of George Orwell’s quote about intelligent people:

“There are some ideas so wrong that only a very intelligent person could believe in them.”

This is a man who believes he knows better than the market. He’s an economics professor that doesn’t believe in the law of supply and demand as taught in Econ 101. He thinks he can control home prices. He thinks he knows the ideal interest rate. He thinks he knows just how much money printing will revive the economy. He believes a healthy economy is driven by artificially propping up home prices, encouraging people to spend money they don’t have, recommending that homeowners borrow against their homes ($3 trillion borrowed and pissed away from 2003 through 2008), and forcing banks to make loans to subprime borrowers – again. His solution to the millions of bank owned homes is to use the taxpayer owned Fannie and Freddie to initiate bulk discount sales of these homes to his friends in the .01% so they can turn around and rent them to their former owners. I wish someone could explain to me how this helps the 99%. It is another backdoor bailout of Wall Street on the straining backs of the American taxpayer.

Obama’s housing solutions in 2009-2010 included multiple home buyer tax credits, loan modification programs, and a myriad of other Keynesian claptrap spending schemes. Bernanke supported all of those measures. They spent $30 billion of your tax dollars in an effort to artificially prop up home prices. Home prices have fallen 10% since they threw your money down the rat hole where all government programs reside, and they continue to fall. These central government planners don’t like to publicize the fact they continue to operate Fannie Mae, Freddie Mac, and the FHA as a way to shift losses from Wall Street to Main Street. Fannie and Freddie have lost $160 billion of your tax dollars since 2008, but amazingly the losses don’t show up in the Federal budget because reality has no place in politics or governmental accounting. The FHA just announced they will require a taxpayer bailout for the first time in their 78 year existence, as they lose $5 billion of your money per year on behalf of the Wall Street banking cartel. The toxic mortgages that don’t reside on the books of Fannie, Freddie and the FHA are sitting on Ben’s balance sheet. They reside, hidden from public view, in the “Other Assets” section of the chart below. His tripling of the Federal Reserve balance sheet was done for one reason only – to save the Wall Street bankers, their shareholders, and their bondholders. His actions have in no way benefitted the American people or the American economy.

It is mind boggling the degree to which central planners like Bernanke, Geithner, Obama and Congress will inflict their vision of how the economy and world in general should operate upon the trusting masses. The American people want to believe their leaders are doing what is best for them. They like dwelling in a land of delusion, security and luxury, where government guarantees to protect them from: terrorists; Iranian invasion; saving for retirement; looking out for their own health; educating themselves; and accepting the consequences of living above their means. Their ability to distinguish between truth and propaganda has been thoroughly degraded by years of government proscribed education. We have chosen to become a knowingly ignorant nation of true believers. There is no time for critical thinking while we anticipate our next tweet about the death of drug addicted pop singer. We have been taught to love our servitude.

“…most men and women will grow up to love their servitude and will never dream of revolution.”– Aldous Huxley – Brave New World

The fallacy of government protecting you, taking care of you and providing you “free” benefits is so ingrained in the American psyche that it is virtually impossible to voluntarily reverse the trend. The truth that Americans refuse to acknowledge is that nothing is free in this life. We are not entitled to own a home, a free education, free healthcare, or a comfy privileged existence. Everything government provides is taken by force from someone else. Everything government does has a cost. Americans have traded freedom and liberty for the appearance of safety and security.The cost is constant war, getting groped by TSA perverts, surveillance by government agencies, threat of imprisonment without charges and a $1 trillion price tag per year. The cost of “free” healthcare is mind numbingly ludicrous rules and regulations for doctors and patients, massive fraud, outrageously expensive procedures and medications, and a $100 trillion unfunded liability left for future generations. The ultimate cost of an overbearing, all controlling government will be economic collapse and revolution.

Who Decides?

“Those who vote decide nothing. Those who count the vote decide everything.” – Joseph Stalin

The concluding act during this bad week for freedom occurred on Saturday in the great state of Maine. When it became clear that Ron Paul was going to win the Maine caucuses, the GOP establishment, that has already anointed Mitt Romney the Republican nominee, decided the people of Maine would be told who won. Using the excuse of an impending snowstorm (less than 1 inch), the powers that be cancelled the caucuses in Washington County where a large contingent of youthful Ron Paul supporters dominated. The Girl Scouts didn’t cancel their event in the same county that day. The men who cancelled the caucus are strong Romney supporters. This was a blatant Stalinist act of voter disenfranchisement. The GOP leaders declared those votes would not count in the totals. Despite this despicable act of rigging an election, Ron Paul doubled his vote percentage from 2008. His message of freedom, liberty, non-interventionism, sound money and self-reliance is reverberating across the land among young people who have not been programmed by the governing elite and the corporate mass media. The establishment will do everything in their power, including vote fraud, to prevent Ron Paul’s anti-establishment message from being heard.

A small delegation of authoritative, rich men continues to pull the strings in this country. The examples I’ve sited in the last week prove we are moving ever more rapidly towards what Friedrich Hayek described as a‘dictatorship of the proletariat’. The actions of the governing class point to no other conclusion as described by Simon Black:

  • Hundreds of thousands of mortgage contracts abrogated by the Federal government;
  • Suspension of gun rights by several local governments;
  • The continued criminalization of protest and free assembly;
  • Increased surveillance and police state tactics;
  • Authorization of military force and detention against the citizens;
  • Seizing and/or voiding pension systems into which workers have paid lifelong contributions;
  • Rejection of long-standing senior debt positions in favor of labor unions;
  • Executive and police agencies ruling by regulation and policy, not by legislative process;

When you pose the possibility of a dictatorship in America, the defender of freedom and democracy, old timers scoff and laugh off the possibility. We are the bright shining light on the mountaintop – that preemptively invades other countries; murders suspected foes with predator drones; imprisons and tortures foreigners in secret prisons; and plans to have 30,000 spy drones patrolling the skies over U.S. cities within the next few years. The government now has the authority to imprison U.S. citizens without cause for as long as they see fit. The government plans to lock down and control the internet. How could we possibly descend toward dictatorial rule? The conditions are perfect for sociopaths dwelling in government bureaucracies to make their move, as elucidated by Doug Casey:

“You may be thinking that what happened in places like Nazi Germany, the Soviet Union, Mao’s China, Pol Pot’s Cambodia and scores of other countries in recent history could not, for some reason, happen in the US. Actually, there’s no reason it won’t at this point. All the institutions that made America exceptional – including a belief in capitalism, individualism, self-reliance and the restraints of the Constitution – are now only historical artifacts.On the other hand, the distribution of sociopaths is completely uniform across both space and time. Per capita, there were no more evil people in Stalin’s Russia, Hitler’s Germany, Mao’s China, Amin’s Uganda, Ceausescu’s Romania or Pol Pot’s Cambodia than there are today in the US. All you need is favorable conditions for them to bloom, much as mushrooms do after a rainstorm.”- Casey Report

Call me a raging optimist, but I see positive signs that an irate tireless minority of Americans are coming to their senses and preparing for a showdown with the ruling oligarchy. The tremendous support for Ron Paul’s message among those under the age of 30 is inspiring. His devoted followers have incredible enthusiasm and will be a force to be reckoned with. The upcoming election will be won or lost based upon whether Ron Paul decides to run as a 3rd Party candidate, spreading his inspirational message. The Occupy Movement is also being driven by people under the age of 30. Their courage and audacity in standing up to brutal establishment military tactics and focusing the attention of the world on the greed, avarice and corruption rampant throughout our economic and political system has given me hope that the good guys can win. Every day the Millenial generation gains strength as the power of the older generations slowly wanes.

The internet has proven to be the best weapon in the fight against the governing elite. It offers people the freedom to ignore government sponsored propaganda being blasted by the corporate media. Critical thinkers can connect with other critical thinkers, while seeking the truth and spreading ideas. You can examine websites like Zero Hedge, Jesse’s Café Americain, Of Two Minds, and Mish to comprehend what is really happening in your world. The tumult and outrage exhibited by millions when the despotic Congressional jackals attempted to pass SOPA and PIPA was inspirational. The people’s voice was heard loud and clear. The politicians ruling over our lives have no guiding principles or moral code. They peddle their votes to the highest bidder. They conduct polls to determine what their constituents want to hear and then shockingly tailor a message that voters find to be exactly what they think. These sociopaths only respond to one thing – being exposed as liars and thieves. When they are confronted by an irate citizenry they scatter like roaches in a West Philly row house kitchen when you turn the light on. Yes votes on SOPA turned to No votes quicker than the Federal government can spend a billion of your tax dollars (10 hours). Obama showed how principled his positions are by backtracking on his “free” contraception mandate in less than 24 hours. If we speak loud enough they will listen, or else.

The “or else” is reflected in the chart below showing gun purchases over the last ten years. Millions of good law abiding Americans are armed. The accelerating trend is a hopeful sign that we will not allow a small contingent of corrupt politicians backed by shadowy rich men (22 men have contributed 67% of all the Super Pac money in the GOP primaries), hiding from public view, to treat this country as their personal playground.

It was a bad week for freedom loving people, but I believe there are enough patriots left in this country to change our course. We are being buried under a blizzard of lies on a daily basis. We have a choice. We can support the existing corrupt crony capitalist establishment (Obama & Romney) or we can declare war on lies, deceit and misinformation by rallying behind the only person who would truly attempt to reverse decades of corruption, sleaze, incompetence, bloat, debt accumulation, and a warped version of free market capitalism – Ron Paul. He is the only public figure willing to level with the American people and tell them the truth. Will we let the concept of truth fade out of the world? The choice is ours.

“In our age there is no such thing as ‘keeping out of politics.’ All issues are political issues, and politics itself is a mass of lies, evasions, folly, hatred and schizophrenia. The very concept of objective truth is fading out of the world. Lies will pass into history.” –   George Orwell

  

“Truth is treason in an empire of lies.” – Ron Paul

PAYCHECKS, PERCEPTION, PROPAGANDA & POWER

“It is difficult to get a man to understand something, when his salary depends upon his not understanding it!” – Upton Sinclair

 

I began to write this article in early December. I had just written a piece that attempted to scrutinize how the American public could stand idly by while heavily armed mercenary thugs viciously crushed the Occupy encampments across the country in a Department of Homeland Security coordinated attack at the behest of the ruling oligarchy.  Comfortably Numb made a case that the political and economic systems of the United States have been captured by a few evil men and they use their wealth and power to control the message hammered into the psyches of an apathetic, distracted, vincibly ignorant public. I started to tackle the question of why Americans could stand by as the new Greatest Generation was being abandoned, derided, scorned, beaten, tear gassed, and arrested for having the courage and audacity to stand up to a powerful corrupt unholy alliance between Wall Street psychopaths, corporate fascist barbarians, and Washington DC power hungry jackals. But I became overwhelmed with a feeling of disillusionment and hopelessness and was unable to write anything for about a month. I found myself questioning whether it was worth fighting such a powerful foe after seeing how easily they crushed the opposition put forth by OWS. After a month I decided I am not one to love my servitude.

“Most men and women will grow up to love their servitude and will never dream of revolution.” – Huxley’s Brave New World

I owe it to my three sons to keep fighting the good fight. They deserve a future. Day by day we draw ever closer to a showdown with the traitors who have sold this country into debt slavery. I don’t dream of revolution, but my eyes are wide open and I see it coming. I had been trying to wrap my head around what happened with the Occupy Movement since the Department of Homeland Security coordinated destruction of most of the encampments around the country in November. The corporate mainstream media immediately moved onto more pressing issues like the Kim Kardashian divorce and Jessica Simpson’s weight gain. The American public has been instructed by the media the Occupy story is history, just like the BP oil spill, the Fukushima nuclear meltdown, and the Egyptian revolution. In a society consumed by reality TV Occupy Wall Street was just another show. The credulous American populace dutifully turned their attention to Black Friday and whipping out one of their 15 credit cards to purchase remote control pillows, 3D 72 inch HDTVs, a see through tank top from the Snooki line of slutware, or thousands of other ludicrous Chinese crap churned out by slave labor in factories built to support the “efficiency” efforts of U.S. conglomerates.

Without a constant irritating presence in the heart of NYC and other large cities, the Occupy Movement appears to have lost steam. I’ve been trying to figure out how and why this happened. The issues that motivated the protests have not gone away. The despicable MF Global crime, committed by a hall of shame member of the .01% – Jon Corzine – has proven beyond a shadow of a doubt the Wall Street/Washington DC criminal conspiracy is alive and well. Unless you have been sitting in line at a Wal-Mart for the last two months to get a $3 waffle-maker, you saw young people across the country tear gassed, shot with rubber bullets, maced, bludgeoned, and brutalized by the paid thugs of the ruling oligarchy on a daily basis. The outrage at the continued looting by the psychopathic Wall Street aristocracy and the horrific police brutality against young people exercising their Constitutional right to free speech and assembly should have ignited widespread anger and mass protest. Instead the reaction has been silence, scorn and smug satisfaction with the government response.

Paychecks & Perceptions

There are a plethora of rationales for the apathy and lack of critical thinking overwhelming our society as we plunge into the depths of a looming economic calamity. They include economic self interest, the power of propaganda to condition the masses, fear of opposing authority, and the perception of a reality that allows you to sleep at night. The Upton Sinclair quote above hit home for me a few weeks ago and explains much of the disdain for the Occupy movement. I was in a high level meeting at my University and during the course of the meeting the Occupy Movement was brought up. A senior executive made a derogatory comment about Occupy and then laughed. I smiled and bit my tongue. In retrospect it shouldn’t have surprised me. I work at one of the top business schools in the world. The person who made the comment has spent his entire life educating students who end up with jobs at Wall Street financial institutions and with America’s largest corporations. It is a natural response for someone whose whole life is reliant upon the existing financial system to psychologically overlook the obvious criminality of the Wall Street fat cats and corporate executives who validate his entire existence and life’s work. He chooses to not understand the message of these protestors because to truthfully comprehend their message would nullify his thirty years of academic efforts. My non-response to the comment about the Occupy Movement was also based upon self-interest and reliance on a paycheck to make a living. I had learned my lesson the hard way during a previous career stop.

It appears older generations have a considerably more negative view of young people protesting the capture of our political and economic system than younger generations. This also makes sense because they have the most to lose and cannot visualize a society other than the one they have created. To acknowledge the validity of the Occupy Movement and the justice of their positions would be to admit their own guilt in the creation of a society that has allowed a chosen few to enrich themselves at the expense of the many. The Baby Boom Generation has been living a lie their entire adulthood. It is true that prior generations created the welfare/warfare state we have today, but the Boomers have had the reins of power for the last two decades in Congress and chose to not only ignore the fact the entitlement promises made by previous administrations could not be fulfilled. They even made further promises in the trillions to their fellow Boomers. Instead of making a budgetary choice between guns and butter, the Boomers chose guns, butter, education, universal healthcare, the right to own a home, the right to a 72 inch HDTV, and zero percent financing on their Cadillac Escalade from government motors. The consequences of these choices are a $15.2 trillion National Debt growing at a rate of $3.7 billion per day and unfunded entitlement liabilities totaling in excess of $100 trillion.

I had the pleasure of meeting Neil Howe, co-author of The Fourth Turning and fourteen other books, in early December. His ground breaking work with William Strauss on generational theory has proven to be uncannily accurate, as their 1997 assessment of what dynamics would drive the course of history over the coming decades have materialized exactly as they presumed. We had a fascinating two hour discussion about various topics impacting the world today and I found that we were in agreement on just about everything, except for the Occupy protests. Neil Howe is an expert on interpreting how generations react to events. I expected him to be impressed by the courage and fortitude of the Millenials leading this protest against Wall Street gluttony and audacious criminality. This is the new GI Generation and I anticipated him perceiving these protests as a prelude to greater feats ahead by this generation. Instead he described them as naive adolescents being led down a phony path by anarchist Boomers. As an example he referenced the fact that many of the protestors were wearing Guy Fawkes masks, the most famous anarchist in history. He found this distasteful and dangerous. My interpretation of the Guy Fawkes masks was more in line with the movie V For Vendetta and the theme of a corrupt evil government keeping the public living in perpetual fear.

“Because while the truncheon may be used in lieu of conversation, words will always retain their power. Words offer the means to meaning, and for those who will listen, the enunciation of truth. And the truth is, there is something terribly wrong with this country, isn’t there? Cruelty and injustice, intolerance and oppression. And where once you had the freedom to object, to think and speak as you saw fit, you now have censors and systems of surveillance coercing your conformity and soliciting your submission. How did this happen? Who’s to blame? Well certainly there are those more responsible than others, and they will be held accountable, but again truth be told, if you’re looking for the guilty, you need only look into a mirror. I know why you did it. I know you were afraid. Who wouldn’t be? War, terror, disease. There were a myriad of problems which conspired to corrupt your reason and rob you of your common sense. Fear got the best of you, and in your panic you turned to the now high chancellor, Adam Sutler. He promised you order, he promised you peace, and all he demanded in return was your silent, obedient consent.” – V For Vendetta

Neil Howe’s impression of the movie centered on the terroristic aspects of blowing up Parliament, not on the symbolism of citizens rising up and casting off the yoke of a malevolent oligarchy that has used propaganda, fear and intimidation to manipulate and control the population. Howe is a Baby Boomer and I’m Generation X. We are each viewing the Occupy Movement through the prism of our life experiences and perceptions about the intentions of these protestors. The existing social, economic, and political structure is dominated by Boomers. Neil Howe views the Occupy Movement as a threat to the system he believes in and supports. As a cynical Xer with no allegiance to a corrupt government, a crony capitalist economic system or a greedy self centered society, I see these young revolutionaries as our last great hope.

 

Neil Howe runs a very successful consulting firm whose clients include Fortune 500 corporations, including Wall Street financial firms. His annual income and net worth is dependent upon the existing corporate dynamic. When your living depends upon not understanding the real reason young people are protesting corporate malfeasance, fraud and corruption, your mind can ignore observable facts and visible truths. Anything can be rationalized when putting food on the table requires you to ignore obvious truths and understandable facts.

Propaganda & Power

“The conscious and intelligent manipulation of the organized habits and opinions of the masses is an important element in democratic society. Those who manipulate this unseen mechanism of society constitute an invisible government which is the true ruling power of our country. …We are governed, our minds are molded, our tastes formed, our ideas suggested, largely by men we have never heard of. This is a logical result of the way in which our democratic society is organized. Vast numbers of human beings must cooperate in this manner if they are to live together as a smoothly functioning society. In almost every act of our daily lives, whether in the sphere of politics or business, in our social conduct or our ethical thinking, we are dominated by the relatively small number of persons…who understand the mental processes and social patterns of the masses. It is they who pull the wires which control the public mind.” – Edward Bernays, Propaganda, 1928 

   File:Edward Bernays.jpg

I was shocked when I came across the above quote a few months ago. Bernays had it figured out 84 years ago before mass media, television, or spin doctors. His vision of a society manipulated by a small number of governing elite who believe they know better than the masses has come to fruition. True republican equality as defined by the founders in the Constitution is considered quaint and a belief of the trusting and naïve masses by the wealthy elite. Manipulation of the masses through a relentless never ending barrage of propaganda disguised as news and unremitting false advertising is designed to control and herd the cattle into the slaughterhouse. We are given the illusion of free choice, when in reality the choices are being made for us by a chosen few who think they know what is best. These puppeteers controlling the strings inhabit the financial, government and corporate halls of power. Their purpose is not to benefit society and its citizens but to protect their wealth and influence, using any means at their disposal. Propaganda to control the minds of a willfully uninformed public has been their most potent weapon.

Source: Mike Kreiger

Most people have never heard the name Edward Bernays. That is the way public relations specialists (manipulators of the truth) like it. They operate in the shadows, subtly influencing public opinion through what Bernays arrogantly referred to as the sinister method of “engineering of consent”. The Governing Elite have no time for messy processes like true capitalism or non-manipulated free elections. The objective for Bernays and his ilk has always been to provide corrupt government power brokers, shadowy bankers and corporate media kingpins with potent psychological instruments of social persuasion and mind control. Edward Bernays is considered the “father of public relations”, and he was the nephew of Sigmund Freud. He pioneered media manipulation techniques.

He understood the weaknesses of the human mind and developed methods and processes for taking advantage of that weakness.

“The average citizen is the world’s most efficient censor. His own mind is the greatest barrier between him and the facts. His own ‘logic proof compartments,’ his own absolutism are the obstacles which prevent him from seeing in terms of experience and thought rather than in terms of group reaction.” – Bernays, Crystallizing Public Opinion

Bernays got his big break during the administration of Woodrow Wilson, the outset of the American interventionist empire bankrolled by an inflation creating Federal Reserve and a tax and spend Congress.  During WWI, Edward began work for the Committee on Public Information, the immense propaganda machine ordered by Woodrow Wilson to sway the American public towards a war he campaigned to keep us out of. He became so instrumental he was invited to accompany Wilson to the Paris peace conference. His claims to fame afterward included:

  • Creating a false storyline of communists in Guatemala on behalf of his client United Fruit Company, resulting in a CIA led military coup which ushered in a brutal dictatorship resulting in the dislocation, torture and death of thousands.
  • He was responsible for breaking the taboo of women smoking in public while working for American Tobacco Company.

His biggest claim to fame was inspiring the most reviled propagandist in history. Bernays’ techniques were so effective that Joseph Goebbels, the Nazi propaganda minister, made copious use of Bernays’ book, “Propaganda” throughout the Holocaust, often crediting Bernays. That was quite a feather in Bernays’ cap. The German people were gradually indoctrinated by their government through propaganda into consenting and supporting the most horrific crimes in history as described by Milton Mayer in his book, They Thought They Were Free – The Germans, 1933-45:

“This separation of government from people, this widening of the gap, took place so gradually and so insensibly, each step disguised (perhaps not even intentionally) as a temporary emergency measure or associated with true patriotic allegiance or with real social purposes. And all the crises and reforms (real reforms, too) so occupied the people that they did not see the slow motion underneath, of the whole process of government growing remoter and remoter.

“To live in this process is absolutely not to be able to notice it—please try to believe me—unless one has a much greater degree of political awareness, acuity, than most of us had ever had occasion to develop. Each step was so small, so inconsequential, so well explained or, on occasion, ‘regretted,’ that, unless one were detached from the whole process from the beginning, unless one understood what the whole thing was in principle, what all these ‘little measures’ that no ‘patriotic German’ could resent must someday lead to, one no more saw it developing from day to day than a farmer in his field sees the corn growing. One day it is over his head.”

Bernays was a master of using psychological techniques to mask the motives of his clients, as part of a calculated strategy aimed at keeping the public unaware of the forces that were working to mold their psyches. Bernays died in 1995, but his techniques have been taken to a new level as our government, media and financial elite use any means at their disposal to keep the masses sedated and content while they are fleeced and herded towards the slaughterhouse. The Big Lie perpetrated upon the masses is the fallacy of America being a democratic society. The anti-democratic and treacherous corporate public relations Madison Avenue maggots manage and manipulate the opinions of the many in order to make sure a true democratic system doesn’t threaten the privileges and supremacy of the governing elite.

I wonder if it was coincidental the creation of the Federal Reserve, implementation of the personal income tax, and virtually non-stop war coincided with the rise of an industry designed to manipulate and control the thoughts and opinions of an easily influenced and willfully unaware populace. Most people want to be led and told what to believe. Critical thinking and taking personal responsibility for your life and your society requires hard work, sacrifice, honesty, and self restraint. Simply believing storylines supplied by authority figures and media pundits allow the masses to continue living lives of debt delusion and hope, occasionally stirred into a frenzy of fear and loathing towards the foreign bogeyman of the moment, chosen by the governing elite. Bernays and his disciples understood this dynamic and have been able to utilize corporate mass media and the human weakness of trusting in the judgments of authority figures to control and manage the vast swath of America without them knowing it.

“If we understand the mechanism and motives of the group mind, it is now possible to control and regiment the masses according to our will without them knowing it.” – Edward Bernays

The propaganda techniques employed to manipulate the masses seemed less abhorrent when they centered upon just consumer products. Convincing women they would look like a gorgeous model if they used a company’s cosmetics or convincing a man he’d be admired by his neighbors if he drove a certain car was small potatoes. In the last few decades the misinformation and outright lies fed to the American public by oligarchy of governing elite has become more manifest and repugnant. The list of abuses is virtually endless.

  • The American public has been lured into debt by the incessant unrelenting lifestyle marketing messages spewed from our TVs 24/7. From the introduction of the show Lifestyles of the Rich & Famous in the early 1980s, wealth, materialism, and consumerism became the motivating force in America. Consumption accounted for only 63% of GDP in 1980, with capital investment accounting for 17%. Today, consumption accounts for 71% of GDP and capital investment only 12%. Keeping up with the Kardashians is the mantra of our times.
  • The utter failure of our government controlled educational system in teaching our children how to think critically or question the validity of government created data has allowed the elite to paper over the fact the average American worker has not had any real income gains in at least four decades. The insidious nature of Federal Reserve created inflation (up 600% since 1970) is incomprehensible to a public that finds math boring and not essential in their lives.

 

  • Once the manipulators convinced the masses they needed a 4,000 sq ft McMansion, two brand new stylish cars, four big screen HDTVs, three computers, stainless steel appliances, granite countertops, a Rolex, Armani suits, an in-ground pool, an ATV, and house at the shore, there was only one thing left to do – loan them the money to live the faux American dream. GDP has grown 525% since 1980. Personal consumption expenditures have grown 600% since 1980. Consumer debt outstanding has grown 700% since 1980. And total household debt outstanding has grown 800% since 1980. It seems the purveyors of debt on Wall Street have been the only beneficiaries of the apparition of an American dream sold to a willingly duped American populace.

 

  • The dream of home ownership was used by politicians of both parties to further their agendas, egged on by the Wall Street elite and the National Association of Realtors – two of the largest contributors to politicians. As politicians tried to outdo themselves creating programs to get poor people into homes, Federal Reserve Chairman Greenspan urged the masses to use creative new adjustable rate mortgage products. With a wink and nod from Greenspan and no fear of any regulation whatsoever, the Wall Street elite created liar loans, negative amortization loans, subprime loans, Alt-A loans and a myriad of other products to induce fraud in the housing market. Appraisers did their part by overstating the values of homes and Wall Street colluded with the rating agencies to package the toxic mortgages and sell them to clueless dupes around the globe with a AAA rating stamped on them. At the absolute peak in 2005, with prices two standard deviations above the long term average, Ben Bernanke declared the housing market strong and the NAR proclaimed it the best time to buy. As the coup de grace, Wall Street urged home owners to unlock that equity in their homes and borrow $3 trillion to spend on gadgets, home upgrades, automobiles, facelifts, new boobs, and exotic vacations. The greatest mass fraud in history was complete. And not one person has gone to jail.
  • Not only have the governing elite lured the masses into debt slavery, but they’ve convinced them to love their slavery. The governing elite have done a fantastic job of using their media mouthpieces to deflect criticism away from their pillaging and looting of the national wealth. They’ve successfully persuaded the slaves the extreme income inequality is beneficial to the country because the 1% are the job creators and have earned their way to the top through our free market capitalism system. Convincing the middle class to blame the poor for their three decade decline is a tribute to the effectiveness of their propaganda crusade. Jesse gives accolades to the father of propaganda as the moneyed interests have won:

“The moneyed interests have done quite a successful PR job in refocusing the national discussion on priorities involving social issues, and the reform of the support systems for the weak, the unfortunate, and the elderly. Turning one group against another, and objectifying your intended victims through slogans and stereotypes, has always been an effective method of bending the herd to your will. Score one for Edward Bernays.”

 

  • The Social Security System is an example of propaganda and misinformation on a grand scale. A modest (1% tax) insurance program designed to help widows and orphans during the Great Depression, which should have been treated much like term life insurance, morphed into a massive retirement plan at the behest of politicians over the last eight decades. The voters shockingly voted for more benefits. Millions are now totally dependent upon the monthly pittance they receive, as the promise of a Social Security pension deterred them from saving for their old age. Politicians perpetuated lies about the funds being protected in a lockbox. The truth is the politicians raided the lockbox and took every dime to spend on wars of choice, aid to dictators, paying off their corporate masters, and leaving only IOUs. They have promised $17.5 trillion more than they can payout. It could be made viable with a gradual rise in the retirement age and a simple means test that would eliminate payouts to those who do not need it. Instead politicians use it as a means to control their constituents and obscure the simple truths. Americans choose to remain ignorant of the facts based on their perceptions of a false reality.

 

  • Another storyline propagated by politicians of a liberal bent is that Medicare is a successful Federal government program. Only someone from the governing elite would declare a program that is $90 trillion underfunded, racked by fraud and abuse totaling almost $100 billion per year, despised by doctors across the land for its insane bureaucracy, and allows corporate insurance, drug and hospital conglomerates to dictate the costs, a success. The entire government run sickcare industry is a scam designed to enrich the corporations that contribute to the campaigns of the politicians writing the rules and regulations. The pricing mechanism between doctor and patient is broken, with neither having any say in the decisions.
  • With the unleashing of a torrent of inflation during the 1970s the governing elite needed to resort to obfuscation and manipulation of inflation figures to create the illusion of price stability and positive GDP, while screwing seniors citizens out of their Social Security benefits and convincing the middle class their annual 3% wage increases were getting them ahead in life. Inflation has been systematically understated by 5% to 7% annually since 1980.

 

  • The government drones at the BLS do the dirty work for their masters by reporting unemployment of 8.6% when the real level exceeds 20%, Great Depression levels. The corporate media just does the bidding of the corporate fascist state by unflinchingly reporting the bogus figures. Reporting the truth would be detrimental to the political and financial elites, so propaganda is rationalized as being beneficial to the country. The sheep just keep grazing as their shepherds herd them toward the slaughterhouse.

 

  • By conducting focus groups and testing words, master manipulators like Frank Lutz have been able to convince the masses to support repeal of the estate tax even though it does not affect 99.7% of American taxpayers. By renaming it a Death Tax, the public was convinced that this horrible abuse of the tax code should be repealed. The 0.3% with the ability and means to manipulate public opinion, won again.
  • The tax code and the propaganda campaign being waged by the richest .01% to obscure the truth and misinform the masses is the most barefaced attempt of the elite to retain their wealth and power. Their corporate media legions pound home the storyline of 50% of Americans not paying their fair share because they pay no Federal income tax. It sure sounds like these weasels must be doing something dishonest to avoid paying Federal taxes. What is not mentioned by the media mouthpieces is 50% of Americans make less than $25,000 per year. What is also conveniently forgotten is these people pay payroll taxes, local income taxes, state income taxes, real estate taxes, sales taxes, tolls and a multitude of other taxes, fees and charges to their utility, cable, and phone providers. In the real world, the total effective tax rate for someone making $50,000 per year exceeds the total effective tax rates of Mitt Romney, Lloyd Blankfein and Warren Buffett.

 

  •  The IRS tax code did not grow to 75,000 pages because the middle class and the poor used their undue influence to convince politicians in Washington DC to insert credits, loopholes and deductions for mega-corporations and the wealthy elite into the code. Only those with wealth, power and influence are allowed to “sway” legislation in Congress. This is called crony capitalist democracy. The current propaganda coming from the GOP candidates is our poor mega-corporations that outsourced millions of American jobs to Asia are overburdened by the 35% corporate tax rate, despite the fact they actually pay an effective rate of 18% and many multi-billion dollar conglomerates pay nothing. The truth is not important or relevant to those running the show in this country.

  • The most damaging and far reaching use of propaganda, misinformation and outright scare tactics by the financial and political elites was during the financial meltdown during September and October of 2008. The American public was whipped into a frenzy of fear by the protectors of Wall Street – Hank Paulson and Ben Bernanke – in order to funnel trillions of taxpayer funds to the Wall Street cartel that created the crisis in the first place. The governing elite declared the economic system would fail unless Wall Street was bailed out. When some courageous Congress members balked at passing TARP, the masters of the universe crashed the stock market with their super computer trading machines. The hysterical pundits on CNBC and the other corporate media outlets shrieked that our way of life would surely die if the banks were not saved. TARP was passed and Wall Street bankers rejoiced by paying themselves billions in bonuses. The truth not revealed to the masses was that the failure of a few reckless ravenously greedy Wall Street banks would not have destroyed our economic system. It would have destroyed the wealth of psychotic bankers like Blankfiein, Dimon, Pandit and a slew of other criminals on Wall Street. Wealthy stockholders and bondholders would have been wiped out. Bank depositors would not have lost a dime. The irresponsible risk junky bankers would have seen their banks liquidated. Bad debts would have been written off. The remaining good assets would have been sold to prudent banks. But instead, the ethically and financially bankrupt were saved by their corporate fascist partners in crime at the expense of the confused and disoriented American citizens. Saving bankers had been successfully marketed to the sheep as being on par with saving the nation. Chalk another one up for Bernays and his brethren.
  • After Bush and his banker cronies successfully fleeced trillions from taxpayers and handed it to bankrupt bankers, Obama and his minions continued the con on the middle class. With the help of Pelosi and Reid he was able to dispense $800 billion of payoffs to various contributors, constituents and special interests while calling it a job creating stimulus plan. When it became clear to even the ignorant masses that no jobs were being created, the governing elite channeled their best Edward Bernays and invented the term “jobs saved”. The beauty of this concept was the impossibility of ever verifying the figures spouted by the paid shills disguised as expert economists. Billions more were funneled to the housing industry and auto industry as paybacks for their contributions in the form of homebuyer tax schemes and Cash for Clunker scams. The bill for these complete failures was passed onto future generations as the National Debt soared from $10.6 trillion to $15.2 trillion in just three years of Obama rule.
  • The latest fraud being perpetrated on the American public is the lie about energy independence touted by GOP candidates for president. Rather than leveling with the people and explaining the facts of peak cheap oil to them honestly, the governing elite prefer slogans, half-truths and fantasy projections. The left touts solar, ethanol and other green energy fantasies, while the right peddles drilling, fracking, and fake estimates of supplies. Both are lying. All the cheap easy to access oil in the world has been found. The oil being discovered and accessed today is harder to reach, more expensive to produce and requires producers to expend almost one barrel of oil to produce a new barrel of oil. The easy to access oil is being depleted at the same rate that new hard to access oil is being brought on line. Meanwhile, demand grows across the globe. Our far flung suburban sprawl society teeters on the edge of an abyss and the governing elite pretend all is well.

The above list of abuses committed by the ruling oligarchy pales in comparison to the totalitarian like measures that have been executed since September 11,2001. With the country cowering in fear, the governing elite passed an Orwellian like 350 page bill that changed this country forever. The USA PATRIOT Act, which changed the relationship between our government and its citizens forever, was supposedly written, introduced, debated and passed in the space of 30 days in October 2001. I wonder which public relations firm came up with the Orwellian acronym?  Uniting (and) Strengthening America (by) Providing Appropriate Tools Required (to) Intercept (and) Obstruct Terrorism Act of 2001. The purpose of naming this bill was to imply that anyone who was against allowing our government to spy, monitor or place under surveillance anyone our government chooses would make you unpatriotic. The American people chose implied safety and security over true freedom and liberty by their deafening silence. The governing elite used fear and propaganda to achieve their goal of more domination over our lives.

Drunk with their new found power, the political elite decided to change the world by using their spin machine to create visions of mushroom clouds over U.S. cities in the minds of a gullible public to craft a believable storyline for the invasion of Iraq. A willingly pliant press corp. spread the misinformation about weapons of mass destruction and Al Qaeda connections to fashion a convincing plot for pre-emptive war on a sovereign country that did not threaten our country. Who benefitted from war with Iraq? The military industrial complex reaped billions in profits and the Wall Street banks bankrolled the invasion with more debt. It only destroyed the lives of thousands of low income American soldiers, killed 100,000 Iraqi peasants, drove the price of oil from $25 a barrel to $100 a barrel, and will ultimately cost American taxpayers $4 trillion. And the great thing about passage of the Patriot Act and invasion of Iraq was the bipartisan cooperation pushing us ever closer to an authoritarian state.

The erroneous notion that Americans have a choice between two political parties that offer distinct and clear opposing policies addressing the major issues facing our country is still perpetuated by politicians and the corporate media. It is untrue, as we have seen the Obama administration employ the same repressive methods instituted by the Bush administration. Military spending rises. Wars of choice proliferate and grow. Obamacare is virtually identical to a plan created by the leading GOP presidential nominee. Further restrictions, regulations and laws are put forth to keep the masses controlled, sedated and fearful. The governing elite and their propagators of misinformation are again formulating a false storyline to convince the easily fooled ignorant public that a sovereign country 7,500 miles from our shores is actually a threat to their lives. While our government has already committed acts of war against Iran (sanctions, assassinations, cyber warfare, and using drones to spy), the public is being worked into a bloodthirsty frenzy of nationalism. Bipartisanship worked so well with Iraq. How could it possibly go wrong with Iran?                      

In the last six months cracks have begun appearing in the fascist façade masquerading as a democratic republic. The rise of the Occupy Movement, increasing pain and discontent among the middle class, a small but vocal irate minority utilizing the internet to organize, inform and spread knowledge, and the growing support among the liberty minded for Ron Paul’s candidacy are the opening salvos in a coming revolution. The volleys being traded between the forces of the American aristocratic elite and the leading forces of this revolution are only the opening shots on par with Bunker Hill. The oligarchs have won the initial skirmishes with the Occupy Movement through their control of superior mercenary fire power and ability to falsify the message and nature of the protestors. The corporate mass media propaganda machine convinced an apathetic, non critical thinking public the protestors were nothing but dirty, lazy, college students looking for government handouts organized and led by George Soros. Journalist Robert Fisk reveals the true nature of the protests and rage:

“And that is the true parallel in the West. The protest movements are indeed against Big Business – a perfectly justified cause – and against “governments”. What they have really divined, however, albeit a bit late in the day, is that they have for decades bought into a fraudulent democracy: they dutifully vote for political parties – which then hand their democratic mandate and people’s power to the banks and the derivative traders and the rating agencies, all three backed up by the slovenly and dishonest coterie of “experts” from America’s top universities and “think tanks”, who maintain the fiction that this is a crisis of globalization rather than a massive financial con trick foisted on the voters.

The banks and the rating agencies have become the dictators of the West. Like the Mubaraks and Ben Alis, the banks believed – and still believe – they are owners of their countries. The elections which give them power have – through the gutlessness and collusion of governments – become as false as the polls to which the Arabs were forced to troop decade after decade to anoint their own national property owners. Goldman Sachs and the Royal Bank of Scotland became the Mubaraks and Ben Alis of the US and the UK, each gobbling up the people’s wealth in bogus rewards and bonuses for their vicious bosses on a scale infinitely more rapacious than their greedy Arab dictator-brothers could imagine.” – Robert Fisk, Bankers are the Dictators of the West

The mounting desperation of the oligarchs is palpable. They have circled the wagons as one of their leaders – Jon Corzine – was caught stealing $1.2 billion directly from the accounts of his customers after making reckless bets that went wrong and bankrupted his firm. The Department of Homeland Security coordinated brutality unleashed upon peaceful protestors in cities across America opened the eyes of more people to the approach of an increasingly oppressive state. The media lapdogs have come out in force with an organized smear campaign designed to derail the presidential campaign of Ron Paul, the only candidate talking about real change and a real downsizing of the American empire. Ron Paul’s platform of liberty, freedom, non-interventionism, sound money, and a government not controlled by bankers and corporate interests is anathema to the ruling elite of both parties. A vote for one of the hand selected candidates offered by the moneyed interests is simply a vote for the special interest status quo. As our economic system becomes more saturated with debt by the day a tipping point approaches.

Obama’s signing of the NDAA, overwhelmingly supported by politicians of both parties, now gives the ruling class the ability to track down and imprison indefinitely any American citizen they consider a threat to their power, without charges. The only remaining thorn in their side is the internet. The internet has allowed critical thinkers to share information, organize resistance to the oligarchs, create communities of like-minded citizens, and allow individuals the opportunity to turn the tables and perform surveillance on the state. The state does not like an unfettered internet because it allows citizens to find the non-manipulated truth and undermines their mainstream media propaganda machine. Young people are less able to be manipulated. The introduction of abominable legislation like SOPA and PIPA are a blatant attempt by the governing elite to crush dissent by locking down the internet and eliminating sites that question their version of reality.

Humans are a flawed species. Our minds are easily manipulated. We don’t like pain. We prefer instant gratification. We are susceptible to mass delusion. We will often choose hope over critical thought. Those with higher IQs will regularly attempt to take advantage of those with lower IQs. Fear and greed are the two motivations used by the minority in power to control and manipulate the majority. The American people have been led astray by a small group of powerful men. We were herded through a door in the wall of perception that promised an American dream of material goods, entitlements and pleasure with no obligations or responsibility to future generations. There is only one choice that can save this country from ruin. Each individual must make a choice to either to continue supporting the manipulative, corrupt status quo or coming back through the Door in the Wall.

 

“The man who comes back through the Door in the Wall will never be quite the same as the man who went out. He will be wiser but less sure, happier but less self-satisfied, humbler in acknowledging his ignorance yet better equipped to understand the relationship of words to things, of systematic reasoning to the unfathomable mystery which it tries, forever vainly, to comprehend” – Aldous Huxley

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

“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

PEACOCK SYNDROME – AMERICA’S FATAL DISEASE

“There will be, in the next generation or so, a pharmacological method of making people love their servitude, and producing dictatorship without tears, so to speak, producing a kind of painless concentration camp for entire societies, so that people will in fact have their liberties taken away from them, but will rather enjoy it, because they will be distracted from any desire to rebel by propaganda or brainwashing, or brainwashing enhanced by pharmacological methods. And this seems to be the final revolution.”  – Aldous Huxley

 

Researchers at the University of Texas recently published a study about why men buy or lease flashy, extravagant, expensive cars like a gold plated Porsche Carrera GT. There conclusion was:

“Although showy spending is often perceived as wasteful, frivolous and even narcissistic, an evolutionary perspective suggests that blatant displays of resources may serve an important function, namely as a communication strategy designed to gain reproductive rewards.”

To put that in laymen’s terms, guys drive flashy expensive cars so they can get laid. Researcher Dr Vladas Griskevicius said: “The studies show that some men are like peacocks.  They’re the ones driving the bright colored sports car.”

Lead author Dr Jill Sundie said: “This research suggests that conspicuous products, such as Porsches, can serve the same function for some men that large and brilliant feathers serve for peacocks.” The male urge to merge with hot women led them to make fiscally irresponsible short term focused decisions. I think the researchers needed to broaden the scope of their study. Millions of Americans, men and women inclusive, have been infected with Peacock Syndrome. Millions of delusional Americans thought owning flashy things, living in the biggest McMansion, and driving a higher series BMW made them more attractive, more successful, and the most dazzling peacock in the zoo.

This is not an attribute specific to Americans, but a failing of all humans throughout history. Charles Mackay captured this human impulse in his 1841 book Extraordinary Popular Delusions and the Madness of Crowds:

“Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one.”

The herd has been mad since 1970 and with the post economic collapse of 2008, some people are recovering their senses slowly, and one by one. The country was overrun by flocks of ostentatious peacocks displaying their plumage in an effort to impress their friends, families and work colleagues. What set the flaunting American peacocks apart was the fact they financed their splendid display of plumage with $0 down and 0% interest for seven years.  The lifestyles of the rich and famous miraculously became available to the poor and middle class through the availability of easy abundant credit provided by the friendly kind hearted Wall Street banks and their heroin dealers at the Federal Reserve.

The United States has experienced a four decade long “expenditure cascade”.  An expenditure cascade occurs when the rapid income growth of top earners fuels additional spending by the lower earner wannabes. The cascade begins among top earners, which encourages the middle class to spend more which, in turn, encourages the lower class to spend more. Ultimately, these expenditure cascades reduce the amount that each family saves, as there is less money available to save due to extra spending on frivolous discretionary items. Expenditure cascades are triggered by consumption. The consumption of the wealthy triggers increased spending in the class directly below them and the chain continues down to the bottom. This is a dangerous reaction for those at the bottom who have little disposable income originally and even less after they attempt to keep up with others spending habits.

This cascade of expenditures could not have occurred without cheap easy credit, supplied by Wall Street shysters and abetted by their puppets at the Federal Reserve through their inflationary policies. Real wages are lower today than they were in 1970. Coincidentally, the credit card began its ascendance as the peacock payment of choice in 1970. There are now over 600 million credit cards in circulation in the U.S. in the hands of 177 million fully plumed peacocks and peacock wannabes.

Monthly Payment Nation

“Consumerism re­quires the services of expert salesmen versed in all the arts (including the more insidious arts) of persuasion. Under a free enterprise system commercial propa­ganda by any and every means is absolutely indis­pensable. But the indispensable is not necessarily the desirable. What is demonstrably good in the sphere of economics may be far from good for men and women as voters or even as human beings.”  – Aldous Huxley

 

 

The country seemed to do just fine from 1945 through 1970 with no credit card debt and moderate levels of auto loan debt. In fact, this period in U.S. history was marked by strong economic growth created by capital investment, savings, and the American middle class realizing the American dream of a better life based upon their work ethic. Around about 1970, the intersection of Baby Boomers coming of age, the belief that social justice for all was a noble goal, and Nixon’s closing the gold window, opened Pandora’s Box and the evil released has brought the country to the precipice of ruin. Today, consumer credit outstanding totals $2.43 trillion, or $22,000 per household. It peaked at $2.6 trillion in 2008 and the storyline fed to the masses was that Americans had seen the light and embraced frugality by paying off their debts. As with most storylines spouted by the mainstream media, it was completely false. The Wall Street banks wrote off over $200 billion since 2008, while delusional peacocks continued to finance and lease gas guzzling luxury automobiles, while charging their purchase of an iPad2 and Lady Gaga concert tickets on one of their 13 credit cards.

It seems a vast swath of America refuse to shed their peacock feathers. This explains why you see BMWs, Mercedes, Escalades, and Porsches parked in the driveways of $100,000 houses. Automobiles are the truest representation of American peacock syndrome. Very few people look at a car purchase in a rational long term financial sense. It’s about impressing the neighbors, your peers and your family. Driving a brand new luxury car gives you the appearance of success. The neighbors don’t know you are in debt up to your eyeballs. This explains why 30% to 40% of all luxury cars are leased. A man could buy a $20,000 Honda hybrid with 10% down and finance the rest at 0.9% for three years. His monthly payment would be $500. After three years he would own the car outright, with the added benefit of getting 45 mpg. He could then invest the $500 per month for the next seven years in gold and silver or something else that benefits from Federal Reserve created inflation. In today’s society this would be the act of a doo doo bird.

  

 

Why drive a putt putt car when you can drive the ultimate peacock machine – a BMW 528i with 24-valve inline 240-horsepower 6-cylinder engine with composite magnesium/aluminum engine block, Valvetronic, and Double-VANOS steplessly variable valve timing, 10-way power-adjustable driver’s and front passenger’s seat with 4-way lumbar support, and memory system for driver’s seat, steering wheel and outside mirrors, along with high-fidelity 12-speaker sound system, including 2 subwoofers under the front seats, and digital 7-channel amplifier with 205 watts of power. Plus it looks really cool. This materialism machine can be leased for the same $500 per month that the doo doo bird pays for his Honda hybrid. Of course, after three years of renting luxury wheels the peacock has to turn in the 528i and lease an equally luxurious auto because driving an economy car would now harm his reputation. Colorful plumage is everything to a peacock.

Sometime over the years Americans lost their bearings and began to ignore a basic truth. The only way to accumulate wealth is to spend less than you make and save the difference. Over a ten year time frame the peacock will have dished out $60,000 renting luxury cars, while the doo doo bird will have expended $21,000 during the first three years and then invested $500 per month for 84 months, leaving him with a net $25,000 asset, based on a modest investment return of 5%. The doo doo bird ends up $85,000 wealthier than the peacock at the end of ten years. If you peruse the car dealer advertisements in your local paper, the price of the car is rarely even printed, only the monthly lease payment or 0% financing offer. There is a reason why the average American lives paycheck to paycheck, has no emergency fund for a rainy day, and has virtually no retirement savings socked away. Status, reputation and the appearance of success became more important to millions of Americans than living within their means and actually sacrificing and doing the hard work required to succeed. Delayed gratification is an unknown concept in America.

In 1970, 37% of households consisted of 4 or more people and we somehow managed to get by with one four door car per household. Today, only 24% of households consist of 4 or more people. There are 113 million households and over 250 million passenger vehicles, or 2.2 per household. So, even though the number of people in our households has shrunk dramatically, we needed 120% more vehicles to transport our vast quantities of stuff. Not only do we have more vehicles, but the size of these symbols of gluttony has doubled and tripled, with fitting names like: Tundra, Navigator, Titan, Yukon, Suburban and Hummer. Every soccer mom with two kids needed a 20 foot long, 6 foot high Yukon with an 8 cylinder engine, getting 12 mpg to shuttle around little Aiden and Chloe to their ten scheduled weekly activities. It wasn’t only automobiles that Americans went gaga over. The average home size in 1970 was 1,400 square feet (we drive cars bigger than that today). By 2009, the average home size reached 2,700 square feet. God knows we need 12 rooms for our 2.4 person households. The expenditure cascade started as a trickle in 1970 but became a raging uncontrollable waterfall by 2008.

 

Delusional Americans have been slowly lured into the web of debt and living their lives based upon whether they can make the monthly payment on their debt. I can anticipate the outrage from those who declare it wasn’t them, it was the other guy. Everyone has an excuse for why they aren’t to blame, but the facts speak otherwise:

  • Non-revolving (auto & education) debt outstanding is at an all-time high of $1.64 trillion.
  • The average auto loan is now $27,000 with a loan to value ratio of 80% to 90%, down from 95% in 2007.
  • Auto dealers are now offering $0 down and 0% interest for 72 months on many models. Ask yourself how a finance company can make a profit with those terms.
  • There are 54 million households with a revolving credit card balance, proving that approximately 50% of Americans are attempting to live above their means.
  • The average credit card debt per household with credit card debt is $14,687.
  • The average APR on a new credit card is 15%, even though the banks can borrow from the Federal Reserve for 0.25%.
  • In 2009, the United States Census Bureau determined there were nearly 1.5 billion credit cards in use in the U.S. A stack of all those credit cards would reach more than 70 miles into space — and be almost as tall as 13 Mount Everests.
  • 76% of undergraduates have credit cards, and the average undergrad has $2,200 in credit card debt. Additionally, they will amass almost $20,000 in student debt.
  • On average, today’s consumer has a total of 13 credit obligations on record at a credit bureau. These include credit cards (such as department store charge cards, gas cards, and bank cards) and installment loans (auto loans, mortgage loans, student loans, etc.).
  • Over 90 percent of African-American families earning between $10,000 and $24,999 had credit card debt. What bank in their right mind would issue a credit card to someone making $15,000 per year?
  • Discussing credit card debt is highly taboo. The topics at the top of the list of things that people say they are very or somewhat unlikely to talk openly about with someone they just met were: The amount of credit card debt (81%); details of your love life (81%); your salary (77%); the amount you pay for your monthly mortgage or rent (72%); your health problems (62%); your weight (50%). I wonder why?
  • Penalty fees from credit cards added up to about $20.5 billion in 2009, according to R. K. Hammer, a consultant to the credit card industry. Don’t be one day late with that credit card payment. It’s good to be a bank.
  • The average late fee was found to have risen to $28.19, way up from $25.90 in 2008. Consumer Action reported that late fees reached up to $39 per incident.
  • The volume of gasoline purchases placed on credit cards jumped 39% last month from a year earlier, compared with a 21% increase in June 2010. Food shopping increased 5% after falling 7% last year. The value of an average transaction on credit cards outpaced the gain for debit cards, showing consumers are increasingly relying on borrowing to pay for gasoline and other necessities.

After decades of a debt financed contest to display the gaudiest plumage, is the average American happier? Considering more than 10% of all Americans are on anti-depressant drugs, I’d say not. The rat race for status, the appearance of wealth and visible faux displays of success do not increase well-being. If most of our earnings are spent on an empty game of status, we should not expect much improvement in our quality of life. There is something perverse about having more than enough. When we have more, it is never enough. It is always somewhere out there, just out of reach. This is the attitude that drives the criminals on Wall Street and politicians in Washington DC to constantly seek more power and wealth. The more we acquire, the more elusive enough becomes. Much of the debt financed purchases of consumer trinkets, baubles and gadgets is nothing more than an expensive anesthetic to deaden the pain of empty lives.

Based upon the facts, the average American has not benefitted from the decades long materialistic frenzy. They have sacrificed their futures for the fleeting glory of ephemeral riches. In fact, the average American could not have participated in the expenditure cascade had they not been enabled by the financial industry and cheap plentiful money provided by the financial industries’ drug dealer – the Federal Reserve. The financial industry complex used their power and wealth to utilize all means of propaganda and mass media outlets to convince Americans that debt was good and more debt was even better. I’ll address the insidious aspects of the unholy union of debt and propaganda in Part Two – Propaganda Nation Built Upon Delusions of Debt.

Meanwhile, millions of Americans cling to their borrowed peacock feathers as the butcher of reality bears down upon them. The end won’t be pretty. The brave conquerors of strip malls across the land can enjoy their toys, gadgets, and treasures for awhile longer, but they need to remember one thing – Glory is fleeting and death can come suddenly.

 

“For over a thousand years Roman conquerors returning from the wars enjoyed the honor of triumph, a tumultuous parade. In the procession came trumpeteers, musicians and strange animals from conquered territories, together with carts laden with treasure and captured armaments. The conquerors rode in a triumphal chariot, the dazed prisoners walking in chains before him. Sometimes his children robed in white stood with him in the chariot or rode the trace horses. A slave stood behind the conqueror holding a golden crown and whispering in his ear a warning: that all glory is fleeting.”

Last scene from the movie Patton
 
 
 
 
 
 
 
 
 
 

 

MASS DELUSION – AMERICAN STYLE (Featured Article)

“Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one.” – Charles Mackay – Extraordinary Popular Delusions and the Madness of Crowds

 

The American public thinks they are rugged individualists, who come to conclusions based upon sound reason and a rational thought process. The truth is that the vast majority of Americans act like a herd of cattle or a horde of lemmings. Throughout history there have been many instances of mass delusion. They include the South Sea Company bubble, Mississippi Company bubble, Dutch Tulip bubble, and Salem witch trials. It appears that mass delusion has replaced baseball as the national past-time in America. In the space of the last 15 years the American public have fallen for the three whopper delusions:

  1. Buy stocks for the long run
  2. Homes are always a great investment
  3. Globalization will benefit all Americans

Bill Bonner and Lila Rajiva ponder why people have always acted in a herd like manner in their outstanding book Mobs, Messiahs and Markets:

“Of course, we doubt if many public prescriptions are really intended to solve problems. People certainly believe they are when they propose them. But, like so much of what goes on in a public spectacle, its favorite slogans, too, are delusional – more in the nature of placebos than propositions. People repeat them like Hail Marys because it makes them feel better. Most of our beliefs about the economy – and everything else – are of this nature. They are forms of self medication, superstitious lip service we pay to the powers of the dark, like touching wood….or throwing salt over your shoulder. “Stocks for the long run,” “Globalization is good.” We repeat slogans to ourselves, because everyone else does. It is not so much bad luck we want to avoid as being on our own. Why it is that losing your life savings should be less painful if you have lost it in the company of one million other losers, we don’t know. But mankind is first of all a herd animal and fears nothing more than not being part of the herd.”

Continue reading “MASS DELUSION – AMERICAN STYLE (Featured Article)”

BRAVE NEW WORLD 2010

 One of my more popular articles from the old site. It seems more pertinent by the day.

“Most human beings have an almost infinite capacity for taking things for granted. That men do not learn very much from the lessons of history is the most important of all the lessons of history.” – Aldous Huxley

Aldous Huxley wrote the dystopian novel Brave New World in 1931 at the inauguration of the last Crisis period in America. Dystopia is the often futuristic vision of a society in which conditions of life are miserable and characterized by poverty, oppression, war, violence, disease, pollution, nuclear fallout and/or the abridgement of human rights, resulting in widespread unhappiness, suffering, and other kinds of pain. The novel was his response to the writings of H.G. Wells (Men Like Gods) and George Bernard Shaw which glorified socialism and a one World State. Orwell’s 1984, written in 1948, is the other famous dystopian novel of the era. Huxley had visited America during the Roaring 20’s and his experience provided the character for the novel. He was outraged by America’s out of control materialistic egocentric society. He witnessed youthful superficiality, commercialization, sexual promiscuity, and a self centered culture. Fellow writer G.K. Chesterton explained his view of Huxley’s novel:

 “After the Age of Utopias came what we may call the American Age, lasting as long as the Boom. Men like Ford or Mond seemed to many to have solved the social riddle and made capitalism the common good. But it was not native to us; it went with a buoyant, not to say blatant optimism, which is not our negligent or negative optimism. Much more than Victorian righteousness, or even Victorian self-righteousness, that optimism has driven people into pessimism. For the Slump brought even more disillusionment than the War. A new bitterness, and a new bewilderment, ran through all social life, and was reflected in all literature and art. It was contemptuous, not only of the old Capitalism, but of the old Socialism. Brave New World is more of a revolt against Utopia than against Victoria.”

Using Technology to Control Society

“Technological progress has merely provided us with more efficient means for going backwards.”  Aldous Huxley

Science and technology are not inherently good or bad. They can be used or misused. They offer promise or peril. Ultimately, humanity can benefit from science and technology or it can be detrimental to our planet. Huxley envisioned a horrifying future where mankind used science and technology in a self destructive manner. He was disillusioned with the decadence of society and disgusted by the behavior of his class. Huxley’s outlook is a world where the vast majority of the populace is united under one World State. The world is restricted to two billion inhabitants. The inhabitants are strictly divided into five castes.  The world is controlled by Alphas and their subordinates, Betas. Below them, in descending order of brainpower and physique, are Gammas, Deltas, and Epsilons. Each caste is further subdivided into Plus and Minus (save for Epsilons, which are regular or semi-moron). Reproductive technology, referred to as the Bokanovsky Process, is used by the government (Alphas & Betas) to manage the number of human beings and their functions. The process is applied to fertilized human eggs in-vitro, causing them to split into identical genetic copies of the original. The State has eliminated procreation by loving couples. Ovaries are surgically removed from women. The lower caste children are created in hatcheries.

At the very pinnacle of society sit Alpha Double-Pluses, who serve as the future scientists and top administrators of the world. People in different castes are conditioned to be happy in their own way – they do not feel resentment towards other castes, but rather feel a slight contempt for people not members of their own caste.  The upper castes are intelligent, and have managerial jobs, where as the lower castes do the manual labor. The Alpha’s have what we would consider the best jobs, and it continues down until the Epsilons, who have the least skilled jobs. The Alphas are tall and fair, while the Epsilons are dark skinned.

The novel takes place in the year 2540 in London. The disturbing aspect is that we are now in the year 2009 and much of Huxley’s vision has come to fruition. At the heart of the World State’s control of its population is its rigid control over sexual mores and reproductive rights. Reproductive rights are controlled through an authoritarian system that sterilizes about two-thirds of women, requires the rest to use contraceptives, and surgically removes ovaries when it needs to produce new humans. The act of sex is controlled by a system of social rewards for promiscuity and lack of commitment. The United States has restricted population growth through a number of methods. Abortion on demand was made the law of the land in 1973. Since that date 50 million abortions have been performed in the U.S. I ask myself how many Martin Luther Kings, Stephen Hawkings, and Ernest Hemingways have been among those aborted before having the chance to positively impact our world.

Source: Alan Guttmacher Institute

Over 12 million women in the U.S. use the pill (available since 1960) on a daily basis in order to avoid pregnancy. The morning after pill was introduced in 1999. Planned Parenthood, created in 1916, has 850 locations in the United States offering easy access to abortions and other forms of contraception. The net result of these government supported efforts has been to cut the birth rate in half in the last century.

Year Births1 Rate2
1910 2,777,000 30.1
1920 2,950,000 27.7
1930 2,618,000 21.3
1940 2,559,000 19.4
1950 3,632,000 24.1
19603 4,257,850 23.7
19703 3,731,386 18.4
1980 3,612,258 15.9
1990 4,179,000 16.7
2000 4,058,814 14.7
2005 4,138,349 14.0

“We are living now, not in the delicious intoxication induced by the early success of science, but in a rather grisly morning after, when it has become apparent that what triumphant science has done hitherto is to improve the means for achieving unimportant or actually deteriorated ends.”  – Aldous Huxley

The upper classes in the U.S. have persuaded the lower classes to restrict their reproduction. They promote non-consequential promiscuity among the other classes while reproducing and raising the new ruling class. American society is also segmented into castes as portrayed by Huxley. The Alpha Double-Pluses are the Harvard MBAs running Goldman Sachs and the other mega-banks. Others in the Alpha caste are the Bushes, Kennedys, Rockefellers, Clintons, Gores, Warren Buffet, Bill Gates, and Paul Krugman. The Betas include Congressmen, bank executives, government bureaucrats, military leaders, and corporate executives. The Gammas and Deltas are the working classes that do the hard work without ever advancing. The Epsilons are the morons produced by the inner city public school system. They fill the non-thinking manual labor jobs of society.

The Gammas, Deltas, and Epsilons are brought up in conditioning centers. The Alphas and the Betas use technology to mould them into their predetermined roles in society. They use operant conditioning and sleep teaching to modify the behavior of the lower castes. Hatcheries rely on machines to condition bottled embryos to heat, sudden motion, and disease, allowing the embryos to fulfill their predestined jobs in specific climates. The science exists today to produce whatever traits are desired in our children. The procedure is called pre-implantation genetic diagnosis and is being practiced in fertility clinics in the U.S.

Those in control of America also use conditioning and teaching to keep the lower classes in their place. The ruling elite send their children to exclusive private schools, grooming them for Harvard, Yale and Stanford. This guarantees they will be given the high level positions in business and government. After decades of pumping billions of tax dollars into public schools while instituting politically correct diversity programs to dumb down the curriculum, the ruling elite have conditioned a vast swath of Americans to care more about Tiger Woods’ driving and night putting skills than about the National Debt or the insidiousness of Federal Reserve induced inflation.

  Total 18 Yrs No High School High School Some Associates Bachelors Advanced
  & Over Degree Degree College Degree Degree Degree
millions        No Degree      
All Races 224,703 32,010 69,480 44,168 18,589 40,070 20,387
    14.2% 30.9% 19.7% 8.3% 17.8% 9.1%
White 154,603 14,457 48,207 31,488 13,753 30,809 15,890
    9.4% 31.2% 20.4% 8.9% 19.9% 10.3%
Asian 10,277 1,153 1,965 1,478 667 3,106 1,907
    11.2% 19.1% 14.4% 6.5% 30.2% 18.6%
Black 26,363 4,779 9,213 5,659 2,132 3,215 1,364
    18.1% 34.9% 21.5% 8.1% 12.2% 5.2%
Hispanic 30,286 11,191 9,130 4,684 1,729 2,539 1,012
    37.0% 30.1% 15.5% 5.7% 8.4% 3.3%

Source: Census Bureau

Just as in Brave New World, the ruling Alphas are White and the lowest class Epsilons are dark skinned. Blacks and Hispanics represent 50% of all the high school dropouts even though they only make up 25% of the population. This guarantees a life of blue-collar low paying jobs for these people. Whites obtain 78% of the advanced degrees, guaranteeing them the positions of leadership in society. The social welfare state implemented by the ruling elite provides enough sustenance to the lower classes to keep them anesthetized, ignorant and easily manipulated. Whites also obtain 77% of the bachelor’s degrees, assuring that they will fill the Beta administrator positions in society.

Another technological method of keeping the masses tranquilized and distracted in the Brave New World is through high tech sports and entertainment. Sport is a pillar of the World State consisting of various games and activities which use high-tech equipment. Another key aspect of entertainment is the “feelies”. Users rest their hands on metal knobs protruding from the arms of their chair, allowing them to feel the physical sensations of the actors on-screen (usually in sexually-themed films). The mass production of HDTVs, CD players, Laptop computers, Blackberries, iPhones, iPods, luxury automobiles and other electronic toys distributed to the masses through easy credit policies has successfully distracted the populace from the pillaging of the country by the Alphas at Goldman Sachs. The feelies of today are 24 hour cable TV with 600 stations, downloadable movies, an unlimited amount of free porn on the internet, strip joints, and prostitution. Sports addicts can attend baseball, football, basketball, hockey, soccer, wrestling, boxing, auto racing, and Michael Vick sponsored dog fighting events year round, or watch it on TV 24 hours per day. With mindless jobs and unlimited distractions, the preponderance of citizens are as docile as sheep.

Soma is a biological method used by the Alphas to keep the lower castes sedated. It is a drug that provides an easy escape from the hassles of daily life and is employed by the government as a method of control through pleasure. It is ubiquitous and ordinary among the culture of the novel and everyone is shown to use it at some point, in various situations: sex, relaxation, concentration, confidence. It is seemingly a single-chemical combination of many of today’s drugs’ effects, giving its users the full hedonistic spectrum depending on dosage. As a kind of “sacrament,” it also represents the use of religion to control society. Huxley’s description of soma reveals its power:

“And if ever, by some unlucky chance, anything unpleasant should somehow happen, why, there’s always soma to give you a holiday from the facts. And there’s always soma to calm your anger, to reconcile you to your enemies, to make you patient and long-suffering. In the past you could only accomplish these things by making a great effort and after years of hard moral training. Now, you swallow two or three half-gramme tablets, and there you are. Anybody can be virtuous now. You can carry at least half your morality about in a bottle. Christianity without tears—that’s what soma is.”

American leaders bluster about the dangers of drug and alcohol abuse, but their actions speak otherwise. Americans can sedate themselves legally with alcohol, over the counter prescriptions, and tobacco. Almost 10% of the entire U.S. population, or 27 million people, are taking anti-depressant pills. Over 4 million children are being drugged with Ritalin every day to make them malleable. The government looks the other way as the middle class uses marijuana, heroine, and cocaine. The Epsilons (Blacks & Hispanics) on the other hand are prosecuted, with 2.3 million of them occupying cells in the thousands of prisons in the U.S. There are thousands of churches in the U.S. preaching the good word and sedating the masses. As they preach morality and sacrifice, there have been recurring instances of sexual deviation covered up church hierarchy and the bilking of congregations out of millions in contributions for the enrichment of the church leaders.

Consumer Society

“Most of one’s life is one prolonged effort to prevent oneself from thinking. People intoxicate themselves with work so they won’t see how they really are.” Aldous Huxley

Huxley formulated his dystopian world after observing the excessiveness of Americans during the Roaring 20’s. If he thought things were decadent and Americans were self consumed in the 1920’s, Huxley’s head would explode at the debauchery, ignorance materialism, and shallowness of Americans today. Our landfills contain more wealth than entire Third World countries. We throw away over 100 billion pounds of edible food per year. In his Brave New World Revisited, written in 1958, Huxley clearly laid out the dangers of consumerism:

“Consumerism re­quires the services of expert salesmen versed in all the arts (including the more insidious arts) of persuasion. Under a free enterprise system commercial propa­ganda by any and every means is absolutely indis­pensable. But the indispensable is not necessarily the desirable. What is demonstrably good in the sphere of economics may be far from good for men and women as voters or even as human beings.”

“Consider a simple example. Most cos­metics are made of lanolin, which is a mixture of purified wool fat and water beaten up into an emulsion. This emulsion has many valuable properties: it penetrates the skin, it does not become rancid, it is mildly antiseptic and so forth. But the commercial prop­agandists do not speak about the genuine virtues of the emulsion. They give it some picturesquely volup­tuous name, talk ecstatically and misleadingly about feminine beauty and show pictures of gorgeous blondes nourishing their tissues with skin food. “The cosmetic manufacturers,” one of their number has written, “are not selling lanolin, they are selling hope.” For this hope, this fraudulent implication of a promise that they will be transfigured, women will pay ten or twenty times the value of the emulsion which the propagandists have so skilfully related, by means of misleading symbols, to a deep-seated and almost universal feminine wish — the wish to be more attrac­tive to members of the opposite sex. The principles underlying this kind of propaganda are extremely sim­ple. Find some common desire, some widespread uncon­scious fear or anxiety; think out some way to relate this wish or fear to the product you have to sell; then build a bridge of verbal or pictorial symbols over which your customer can pass from fact to compensa­tory dream, and from the dream to the illusion that your product, when purchased, will make the dream come true.”

Our economic advancement has been marketed to Americans as “true happiness from consumption”. Every need can be realized through material gain. Success as a society is measured by GDP growth and the facade of prosperity. In Brave New World children are conditioned from birth to value consumption with such platitudes as “ending is better than mending,” which means buy a new one instead of fixing the old one. America has become the definitive throwaway society. Product waste has grown from 92 pounds per person per year in 1905 to 1,242 pounds per person per year in 2005. American human beings are lumped into the category of consumers by the mainstream media. Consumerism and consumer debt have been the contaminated lifeblood of the United States for the last three decades. Government actively promotes gambling by the poor, offering them false hope for riches. Americans squander $160 billion per year on lotteries and in casinos. Our society has become even more extreme than the Brave New World as we have outsourced our production to foreign countries, thereby gutting our economy. Even at the dawn of television Huxley realized the immense power for propagandists:

“Thanks to compulsory education and the rotary press, the propagandist has been able, for many years past, to convey his messages to virtually every adult in every civilized country. Today, thanks to radio and television, he is in the happy position of being able to communicate even with unschooled adults and not yet literate children.”

United States advertising expenditures, 1920–2007 in constant 2007 dollars (billions)*

The mass media is owned and controlled by mega-corporations run by the Alphas of our society. Colleges graduate thousands of people with the skills to manipulate the uninformed masses through advertising and propaganda. What passes for news organizations are just propaganda machines for a particular point of view. The public is distracted by the seemingly major differences between the two main political parties. The reality is that both parties are controlled by banking and corporate interests who pay for the laws that benefit their interests. Huxley’s description of political candidates in 1958 is even truer today:

“The methods now being used to merchan­dise the political candidate as though he were a deo­dorant positively guarantee the electorate against ever hearing the truth about anything.”

News people must be beautiful and entertainment is indispensable. They provide the people what they want – 24 hour coverage of Tiger Woods’ sex life, weeks of reporting about Michael Jackson’s death, and 10 seconds about the $100 trillion of unfunded liabilities we are leaving future generations. Truth is an inconvenience in the consumer society.

Incompatibility of Happiness & Truth

“Great is truth, but still greater, from a practical point of view, is silence about truth. By simply not mentioning certain subjects… totalitarian propagandists have influenced opinion much more effectively than they could have by the most eloquent denunciations.”  Aldous Huxley

Mustapha Mond, World State Controller, believes that the population is better off with happiness than truth. In the Brave New World happiness is represented by immediate gratification of every citizen’s desire for food, sex, drugs, nice clothes, and other consumer trinkets. If the proletariats think they are happy, they won’t need to think or question reality. The World State cannot allow individuality to blossom. Free thinking individuals seek the truth. Spending time alone is considered an outrageous waste of time and money. Confession to a craving for individuality is shocking, horrifying, and embarrassing. John, the savage, grew up outside the World State and has studied Shakespeare. Everything that Shakespeare stood for: passion, love, intensity, seeking truth, relationships, and tragic endings, are at odds with the World State foundation. They cannot allow truth and true human happiness to exist in society or the Alphas will lose control.

The United States is the richest most powerful country in the history of the world. Our poorest live better than the aristocracy lived 100 years ago. We have indoor plumbing, air conditioning, heaters, clean water, automobiles, trains, jet airplanes, televisions, CD players, portable gadgets galore, free public education, fast food, gyms to work off the fast food, movies, the internet, restaurants, bars, concerts, sporting events, casinos, home improvement stores, grocery stores, discount stores, Wal-Mart, clothes stores, jewelry stores, dollar stores, churches, Disney World, Las Vegas, and Graceland. These are the “things” that are supposed to make Americans happy. Going into the woods alone, like Thoreau, to think is frowned upon. The propagandists sell the American public happiness in the form of material goods and services. If you don’t feel happy, take a pill. If you aren’t happy with your appearance have plastic surgery. If your spouse isn’t making you happy, cheat or get a divorce and try again. If your neighbor outdoes you by getting a $20,000 kitchen remodel, get yourself a $40,000 kitchen remodel. Happiness is a 6,000 sq ft McMansion with 5 bathrooms, a pool, game room, and Jacuzzi for your family of three. Having your neighbors see you driving a BMW 750Li will surely make you happy. Wearing a Rolex will definitely make you happy. If you die with the most toys, you’re still dead. Until reading a book to your three year old at bedtime is valued more than staying at the office until 10:00 pm to complete an investment offering, our society is destined for decline. Ours is not to reason why, but simply to do and die with a bare minimum of fuss.

In the Brave New World the policies of the State dehumanize the population. Stability and artificially induced happiness are more imperative than humanity and truth. Mustapha Mond explains to John that social stability has required the sacrifice of art, science, and religion. John protests that, without these things, human life is not worth living. After John eventually succumbs to the lure of the World State version of happiness, he hangs himself. An ending truly worthy of a Shakespearean tragedy. The pillars of our society are based upon the acquisition of material possessions using debt. Our society glorifies steroid taking athletes, sex crazed sports icons, drugged out entertainment personalities, vacuous TV housewives, and moronic cosmetically enhanced movie stars. Those who seek truth through questioning the status quo or digging for answers to questions the State doesn’t want asked, risk alienation and scorn. The Alphas (bankers) of our society issue the debt and convince the masses that accumulating more stuff will make them happy. The Alphas (media titans) use their mass media to persuade, manipulate, and sell their message of material happiness to the masses. The Alphas (politicians) use the taxes collected from the masses and the dollars printed by the bankers to distribute social welfare benefits to the lower classes, keeping them sedated and under control. Seeking the truth through the study of literature, the questioning of authority, and pondering of our existence on this earth are rare. Those who question and doubt the propaganda put out by those in authority are shunned and denigrated as being unpatriotic.

“Most ignorance is vincible ignorance. We don’t know because we don’t want to know.” Aldous Huxley

Dangers of an All-Powerful State

“Freedom is therefore a great good, tolerance a great virtue and regimentation a great misfortune. Meanwhile there is still some freedom left in the world. Many young people, it is true, do not seem to value freedom. But some of us still believe that, with­out freedom, human beings cannot become fully hu­man and that freedom is therefore supremely valuable. Perhaps the forces that now menace freedom are too strong to be resisted for very long. It is still our duty to do whatever we can to resist them.” Aldous Huxley

The all powerful State in Brave New World uses technology and mind control starting before birth until death to instruct people what they want. Power over the citizens is maintained by lulling them into a false sense of happiness and contentment to the point where personal freedom and thinking are unnecessary. Superficiality is encouraged by the World Controllers. The consequences of citizens rolling over to the rulers are a loss of dignity, morals, values, and emotions—in short, a loss of humanity. Amazingly, this book was written in 1931. Huxley’s vision, which seemed so outrageous in 1931, has come to fruition in less than 70 years, versus the 600 years in the novel. Huxley realized that technological advances which are almost universally hailed as progress are fraught with danger. Man has built higher than he can climb; man has unleashed power he is unable to control. Brave New World is Huxley’s warning to make man realize that since knowledge is power, he who manages and exploits knowledge exerts the authority. Science and technology should be the servants of man – man should not be adapted and enslaved to them.

In the novel the “Nine Years’ War” broke out in 2049 AD. It can be deduced that the conflict broke out in Europe, affected most of the planet, and caused enormous physical damage. It is repeatedly stated that chemical and biological weapons were broadly used during the war, particularly in mass air-raids against cities. Following the war the global economy collapsed and created an unprecedented worldwide economic crisis. Realizing that they could not force people to adopt the new lifestyle, the World Controllers instead united the planet into the One World State and began a nonviolent movement of change. This campaign included the closing of museums, the suppression of almost all literature published before 2059 AD, and the destruction of the few historical world monuments that had survived the Nine Years’ War. The type of war described in the novel is a very feasible scenario in our current environment. It is interesting that a worldwide economic crisis was the trigger for a One World Government. Our current worldwide economic crisis has resulted in our Federal Reserve propping up European banks with U.S. taxpayer funds and unprecedented coordination between worldwide fiscal policies.

Huxley wrote his novel in 1931 at the outset of the Great Depression. His vision did not take long to crystallize. FDR initiated social programs on a vast scale to satiate the masses with manual labor government created jobs and social services that encouraged reliance upon the state at the expense of freedom and liberty. His nightmare world became more of a reality after World War II as progressives were successful in creating the United Nations, NATO, World Bank, IMF, Bretton Woods system, and GATT. These organizations reduced the freedom of individual countries to the benefit of worldwide bureaucracies. These organizations have gained power over time, but their total incompetence and ineffectiveness has kept them from gaining total control over world populations.

We are now at a crucial juncture as the worldwide financial crisis and the sham global warming crisis are being used by the New World Order crowd to confiscate more of our freedoms and liberties. Socialist minded world leaders Gordon Brown and Barack Obama, along with the revered Henry Kissinger have referenced a New World Order while offering their Keynesian spending solutions to the worldwide financial crisis. A number of Obama advisors have written they support a one world government. The Copenhagen Conference on Global Warming has drawn thousands of one world government apostles. They want to use the scientifically unproven environmental crisis as a way to impose worldwide taxes on sovereign nations and to compel the citizens of the world to honor their green agenda. The use of propaganda in our school systems to scare children by telling them that polar bears are all dying, is part of their plan. Again, the subtle use of media and propaganda to influence the thinking of the willfully ignorant public has worked.

Dystopian Nation  

“Facts do not cease to exist because they are ignored.” Aldous Huxley

When I started this article I was unsure whether Huxley’s nightmare would resonate in our current reality. Sadly, much of his novel applies to our society. Even sadder, our society now resembles an amalgamation of the two most famous dystopian novels in history: 1984 and Brave New World. Social critic Neil Postman contrasted the two views of the future:

“What Orwell feared were those who would ban books. What Huxley feared was that there would be no reason to ban a book, for there would be no-one who wanted to read one. Orwell feared those who would deprive us of information. Huxley feared those who would give us so much that we would be reduced to passivity and egoism. Orwell feared that the truth would be concealed from us. Huxley feared the truth would be drowned in a sea of irrelevance. Orwell feared we would become a captive culture. Huxley feared we would become a trivial culture, preoccupied with some equivalent of the feelies, the orgy porgy, and the centrifugal bumblepuppy. As Huxley remarked in Brave New World Revisited, the civil libertarians and rationalists who are ever on the alert to oppose tyranny “failed to take into account man’s almost infinite appetite for distractions.” In 1984, Orwell added, people are controlled by inflicting pain. In Brave New World, they are controlled by inflicting pleasure. In short, Orwell feared that what we fear will ruin us. Huxley feared that what we desire will ruin us.”

Our civilization has fused the worst of both novels. Many people in our country aren’t capable of reading a book. Supposedly educated people have no interest in reading a book. The government withholds or manipulates information that is spoon fed to the public. Trivial meaningless information floods the airwaves, keeping the public continuously diverted from seeking truth. The truth is lost in shades of grey and purposeful misinformation. Supposed differences between the ruling parties distract the public from realizing they are being fleeced by those in power. Government has used fear to create agencies and departments that have taken away our liberties and freedoms through Orwellian surveillance techniques. Our dumbed down culture of hero worship, material pleasures, and ego enhancement is the representation of triviality. The Alphas have used our fears and desires to distract us from their plans to dominate and control every aspect of our lives. Their success is all but assured at this point.

I’m not optimistic that there are enough Americans who value freedom over presumed safety, security, and social welfare benefits. The public has been duped into believing thrilling falsehoods rather than unexciting truths. Huxley explains how the propagandists have stolen our freedom:

“In their anti-rational propaganda the enemies of freedom systematically pervert the resources of lang­uage in order to wheedle or stampede their victims into thinking, feeling and acting as they, the mind-manipulators, want them to think, feel and act. An education for freedom (and for the love and intelli­gence which are at once the conditions and the results of freedom) must be, among other things, an educa­tion in the proper uses of language.”

I do not pretend to have the answers. Intellectual curiosity, a skeptical nature, and not buying into our shallow culture are the best chance for change. Reading or re-reading Orwell’s 1984 and Huxley’s Brave New World and Brave New World Revisited will open your eyes to our plight. The current Fourth Turning will end in glory or tragedy. The choices we make as a society in the next 10 to 15 years will ultimately decide our fate. Huxley’s advice in Brave New World Revisited is wise, pertinent, and implementable today:

  • As recent history has repeatedly shown, the right to vote, by itself, is no guarantee of liberty. Therefore, if you wish to avoid dictatorship by referendum, break up modern society’s merely func­tional collectives into self-governing, voluntarily cooperating groups, capable of functioning outside the bureaucratic systems of Big Business and Big Govern­ment.
  • If you wish to avoid the spiritual impoverishment of individuals and whole societies, leave the metropolis and revive the small country community, or alternately humanize the me­tropolis by creating within its network of mechanical organization the urban equivalents of small country communities, in which individuals can meet and co­operate as complete persons, not as the mere embodi­ments of specialized functions.

As citizens of the American Republic we must answer the question posed by Huxley:

“Do we really wish to act upon our knowledge? Does a majority of the population think it worthwhile to take a good deal of trouble, in order to halt and, if possible, reverse the current drift toward totalitarian control of everything?”

“There is no darkness but ignorance. The devil can cite Scripture for his purpose.” William Shakespeare