Tag: Revolution

UNFORGIVEN – PART FIVE

 

 

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

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

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

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

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

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

“deserves got nothin’ to do with it.”

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

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

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

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

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

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

 

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

Preparation

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

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

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

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

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

 

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

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

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

 

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

   

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

 

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

 

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

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

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

Retribution

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

 

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

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

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

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

 

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

 

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

financial-wealth-united-states

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

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

Atonement

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

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

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

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

 

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

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

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

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

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

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

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

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

 

 

 

A SIMPLE DOCUMENT

The simple document below contains 1,333 words that changed the world. It is a succinct document that does not try to obscure, confuse or mislead anyone. In comparison, the Obamacare Bill (never read by any member of Congress) and subsequent regulations, that are now being implemented to improve your lives, is 2,800 pages long and contains 2,163,744 words. Obamacare is 1,623 times longer than the Declaration of Independence. The U.S. Constitution only contained 4,400 words. The King James version of the Holy Bible contains 830,314 words. What does this tell you? That Obama is wiser than God?

It harkens to a quote from Tacitus about the Roman Empire:

“The more corrupt the state, the more numerous the laws.”

This isn’t the only example of a government out of control and failing to act in the best interests of its citizens. The Glass Steagall Act was 37 pages long and effectively kept bankers from destroying the world for 60 years. Within 15 years of its repeal, the bankers had pillaged and raped the citizens of the world and destroyed our economic system. The toothless Dodd-Frank Bill, written by Wall Street, contains 2,319 pages. Has it stopped Corzine and Jaime Dimon from raping farmers and losing billions gambling with other people’s money? No.

Tacitus was right. Our entire STATE is corrupt. And when you read the first few paragraphs of Thomas Jefferson’s succinct and clearly written document, you realize what will be necessary. Our current government has become destructive to the majority of the people in this country.

“Whenever any Form of Government becomes destructive of these Ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such Principles, and organizing its Powers in such Form, as to them shall seem most likely to effect their Safety and Happiness. Prudence, indeed, will dictate that Governments long established, should not be changed for light and transient Causes; and accordingly all Experience hath shewn, that Mankind are more disposed to suffer, while Evils are sufferable, than to right themselves by abolishing the Forms to which they are accustomed. But when a long Train of Abuses and Usurpations, pursuing invariably the same Object, evinces a Design to reduce them under absolute Despotism, it is their Right, it is their Duty, to throw off such Government, and to provide new Guards for their future Security.”

Anyone with their eyes open and capable of critical thought can see that we are descending into absolute despotism, with a small group of oligarchs controlling our lives and dictating what we can and cannot do. It will be impossible to change the system from inside. These oligarchs are too powerful and have written the laws and regulations in a way to insure their continued control and wealth. It is the duty of every citizen of good conscience to resist this tyranny and throw this government into the ashcan of history. A new American Revolution is necessary. A new Declaration of Independence will be written. This Fourth Turning will sweep away the existing entrenched social order. The next fifteen years will again change the course of world history. The linear thinkers don’t see it coming. They will be crushed by the onslaught of real change. Our destiny awaits.

 

DECLARATION OF INDEPENDENCE 

In CONGRESS, July 4, 1776

The unanimous Declaration of the Thirteen United States of AMERICA.

WHEN, in the Course of human Events, it becomes necessary for one People to dissolve the Political Bands which have connected them with another; and to assume, among the Powers Of The Earth, the separate and equal Station to which the Laws of Nature and of Nature’s God entitle them, a decent respect to the Opinions of Mankind requires that they should declare the Causes which impel them to the Separation.

We hold these Truths to be self-evident, that all Men are created equal, that they are endowed by their CREATOR with certain unalienable Rights, that among these are Life, Liberty and the Pursuit of Happiness. — That to secure these Rights, Governments are instituted among Men, deriving their just Powers from the Consent of the Governed, that whenever any Form of Government becomes destructive of these Ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such Principles, and organizing its Powers in such Form, as to them shall seem most likely to effect their Safety and Happiness. Prudence, indeed, will dictate that Governments long established, should not be changed for light and transient Causes; and accordingly all Experience hath shewn, that Mankind are more disposed to suffer, while Evils are sufferable, than to right themselves by abolishing the Forms to which they are accustomed. But when a long Train of Abuses and Usurpations, pursuing invariably the same Object, evinces a Design to reduce them under absolute Despotism, it is their Right, it is their Duty, to throw off such Government, and to provide new Guards for their future Security. Such has been the patient Sufferance of these Colonies; and such is now the necessity which constrains them to alter their former Systems of Government. The History of the present King of Great-Britain is a History of repeated Injuries and Usurpations, all having in direct Object the Establishment of an absolute Tyranny over these States. To prove this, let Facts be submitted to a candid world.

HE has refused his Assent to Laws, the most wholesome and necessary for the public Good.

HE has forbidden his Governors to pass Laws of immediate and pressing Importance, unless suspended in their Operation till his Assent should be obtained; and when so suspended, he has utterly neglected to attend to them.

HE has refused to pass other Laws for the Accommodation of large Districts of People, unless those People would relinquish the Right of Representation in the Legislature, a Right inestimable to them and formidable to Tyranny only.

HE has called together Legislative Bodies at Places unusual, uncomfortable, and distant from the Depository of their public Records, for the sole Purpose of fatiguing them into Compliance with his Measures.

HE has dissolved Representative Houses repeatedly, for opposing with manly Firmness his Invasions on the Rights of the people.

HE has refused for a long Time, after such Dissolutions, to cause others to be elected, whereby the Legislative Powers, Incapable of Annihilation, have returned to the People at large for their exercise; the State remaining, in the mean Time, exposed to all the Dangers of Invasion from without, and Convulsions within.

HE has endeavoured to prevent the Population of these States; for that Purpose obstructing the Laws for Naturalization of Foreigners; refusing to pass others to encourage their Migrations hither, and raising the Conditions of new Appropriations of Lands.

HE has obstructed the Administration of Justice, by refusing his Assent to Laws for establishing Judiciary Powers.

HE has made Judges dependent on his Will alone, for the Tenure of their Offices, and the Amount and Payment of their Salaries.

HE has erected a Multitude of new Offices, and sent hither Swarms of Officers to harass our People, and eat out their Substance.

HE has kept among us, in times of Peace, Standing Armies, without the Consent of our Legislatures.

HE has affected to render the Military independent of and superior to the Civil Power.

HE has combined with others to subject us to a Jurisdiction foreign to our Constitution, and unacknowledged by our laws; giving his Assent to their Acts of pretended Legislation:

FOR quartering large Bodies of Armed Troops among us:

FOR protecting them, by a mock Trial, from Punishment for any Murders which they should commit on the Inhabitants of these States:

FOR cutting off our Trade with all Parts of the World:

FOR imposing Taxes on us without our Consent:

FOR depriving us in many Cases, of the Benefits of Trial by Jury:

FOR transporting us beyond Seas to be tried for pretended Offences:

FOR abolishing the free System of English Laws in a neighbouring Province, establishing therein an arbitrary Government, and enlarging its Boundaries, so as to render it at once an Example and fit Instrument for introducing the same absolute Rule into these Colonies:

FOR taking away our Charters, abolishing our most valuable Laws, and altering fundamentally the Forms of our Governments:

FOR suspending our own Legislatures, and declaring themselves invested with Power to legislate for us in all Cases whatsoever.

HE has abdicated Government here, by declaring us out of his Protection, and waging War against us.

HE has plundered our Seas, ravaged our Coasts, burnt our Towns, and destroyed the Lives of our People.

HE is, at this Time, transporting large Armies of foreign Mercenaries to complete the Works of Death, Desolation, and Tyranny, already begun with Circumstances of Cruelty and Perfidy, scarcely paralleled in the most barbarous Ages, and totally unworthy the Head of a civilized Nation.

HE has constrained our fellow Citizens, taken Captive on the high Seas, to bear Arms against their Country, to become the Executioners of their Friends and Brethren, or to fall themselves by their Hands.

HE has excited domestic Insurrections amongst us, and has endeavoured to bring on the Inhabitants of our Frontiers, the merciless Indian Savages, whose known Rule of Warfare, is an undistinguished Destruction of all Ages, Sexes and Conditions.

IN every Stage of these Oppressions we have Petitioned for Redress in the most humble Terms: Our repeated Petitions have been answered only by repeated Injury. A Prince, whose Character is thus marked by every Act which may define a Tyrant, is unfit to be the Ruler of a free People.

NOR have we been wanting in Attentions to our British Brethren. We have warned them, from Time to Time, of Attempts by their Legislature to extend an unwarrantable Jurisdiction over us. We have reminded them of the Circumstances of our Emigration and Settlement here. We have appealed to their native Justice and Magnanimity, and we have conjured them by the Ties of our common Kindred to disavow these Usurpations, which would inevitably interrupt our Connexions and Correspondence. They too have been deaf to the Voice of Justice and of Consanguinity. We must, therefore, acquiesce in the Necessity, which denounces our Separation, and hold them, as we hold the Rest of Mankind, Enemies in War, in Peace Friends.

WE, therefore, the Representatives of the UNITED STATES OF AMERICA, in GENERAL CONGRESS, Assembled, appealing to the Supreme Judge of the World for the Rectitude of our Intentions, do, in the Name, and by Authority of the good People of these Colonies, solemnly Publish and Declare, That these United Colonies are, and of Right ought to be,FREE AND INDEPENDENT STATES; that they are absolved from all Allegiance to the British Crown, and that all political Connexion between them and the State of Great-Britain, is, and ought to be, totally dissolved; and that as FREE AND INDEPENDENT STATES, they have full Power to levy War, conclude Peace, contract Alliances, establish Commerce, and to do all other Acts and Things which INDEPENDENT STATES may of Right do. And for the Support of this Declaration, with a firm Reliance on the Protection of DIVINE PROVIDENCE, we mutually pledge to each other our Lives, our Fortunes, and our sacred Honour.

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

Thoughts on a Modern Revolution

Part I.  Why it won’t come easy…

Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.

–United States Declaration of Independence

There seems to be a division of thinking when it comes to the 1% vs everybody else.  Many people seem to think that their extreme advantage of resources, the power inherent in the existing structure, and the technology they have access to will ensure their continued dominance.  Others argue that because they are outnumbered 99 to 1 they can only maintain their control if the 99% remain compliant.  While I favor the latter view, questions remain: what percent need to resist in order for the existing power structure to be overthrown?   How does the average citizen overcome the massive advantages available to the existing authority?  Can this be accomplished with peaceful means, or will the conflict escalate into violence?  What does history teach us to expect in the resolution of this crisis?  If the existing structure is torn down, will it be replaced by something better or something worse?

In part 1 of this series, we will investigate the strength of the existing authority, and the inherent advantages that the authority holds over the average citizen who would consider resistance.  In part 2, we will look at the inherent strengths that the average citizen has in resisting the existing authority.  In part 3 we will look at some of the various methods and strategies that the resistance can pursue.  And in part 4 we will try to draw some conclusions about the path this crisis phase will take and what history teaches us to expect.

This is not authoritative commentary.  This is simply my observation and analysis of the challenges and opportunities that exist to the citizens that are contemplating resistance in an effort to restore the existing government to its constitutional origins or to another form entirely.  I welcome your commentary, perspective and wisdom in this study.

Let us look at the various ways in which the 1% are able to maintain their power.  First of all is momentum.  It is human nature to resist major changes.  Sure we like to change to the next new iPhone, but when it comes to major aspects of how we perceive our role in everyday life we ignore, deride, ridicule, or directly oppose both the change as well as those who are advocating it.  For that reason most of the major changes we have witnessed in our lifetimes are a result of tiny, seemingly insignificant changes that incrementally alter the way things are.  Freedom, taxation and legislation have all incrementally mutated from emancipated, transparent and accessible to incarcerated, opaque and ϋber statutory.

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It takes a major shock to convince people that a change is worthy of the effort required to enact it.  Normalcy bias, fear, laziness, and ambivalence all fight to keep things the way they are.  Our overall wealth as a society and the extreme amount of “assistance” given over to what has become a large percentage of the population—the disabled, unemployed, and derelict—have insulated us by and large from hardships that have driven other populations around the world to protest, resistance, and violence.  Our poor are not starving; they are obese.  Our unemployed are not desperate; they are better off with their benefits than with a job.  More people are added to the rolls of the disabled every day by the expansion of the definition of disabled, and by the fact that in many cases they can receive more income while doing nothing productive (SNAP, medical, and direct payments) than they could earn with hard work.

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Because of the distortion created and enforced by the various entitlement programs at the federal, state, and local levels, we have witnessed dramatic increases in the numbers of participants in these programs.  In turn we have seen the tax revenues that support these programs that are paid through the work of productive citizens drop as more and more  people become net recipients of government funds and fewer and fewer people are net contributors.  This trend is clearly unsustainable; however, each new person added to the dole is another person that would have to vote for change that would negatively impact their immediate circumstances.  History suggests that very few people will be willing to support actions that would hurt their personal short term circumstances in favor of society’s long term prosperity.  The consequence of this dynamic is that there will be no slow, transitional wind down of these programs.  Instead these programs and the numbers of people involved will continue to grow until the programs fail catastrophically.  For that reason, it is my assessment that the growing pool of beneficiaries will not be a significant part of any anti-establishment movement, protest, or revolution.

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A contributing factor to the momentum of the establishment and the slow response of the average citizen is the lack of hardship and suffering he faces.  Very few people in the United States go hungry.  Very few people are denied medical care.  Very few people lack clean water, sleep without shelter, lack adequate clothing, have no access to education, can afford no entertainment, or have no access to sanitation.  We are by global comparison a very rich country, and even the poorest in this country live beyond the means of billions worldwide.  In short we all have quite a bit to lose, and that changes the riskiness of choosing to resist.

In my personal situation I have a wife and two children, I own a business that employs 14 people, I have property and investments (not a lot), I have 5 sisters, my mom and pop are living, and I have many close ties in my community.  If I choose to resist the government I put all of those people, all of my property, and all of my ties at risk.  I also put my life and health at risk.  I put my freedom at risk (such as it is).  In essence I put everything that is near and dear to me at risk, and that does (and should) enter into my decision to resist or to comply.

With our poorest tamed by the entitlements they would lose if they resist, the burden of resistance then falls upon a group of people with plenty to lose.  Their incentive is the awakening to the reality that not resisting may cost them all of the same things; however, the risk equation remains “if I resist I will risk all of my treasured people and possessions” vs. “if I resist I may risk all of my treasured people and possessions.”

Another significant factor in favor of maintaining control by the existing authority is force.  The establishment powers, whether behind the scenes (the bankers) or in full view (the politicians) have near complete capture of all the federal (the military, DHS, CIA, FBI, et al), the state (National Guard, SBI, State Troopers, et al) and local (sheriff, city police, et al) agencies.  While there is some question floating around the blogosphere about whether or not the members of those agencies will be willing to fire upon civilians history and recent events make it clear that at least the majority will comply with the orders they receive.  For the same reason that the average citizen is overwhelmed when thinking of how and when to resist authority, the front line soldier or officer is similarly daunted by thoughts of bucking the chain of command.  When you combine that with the very real threat of armed resistance, the possibility of significant violence cannot be ignored.

While any violence on the part of the agents of authority will likely escalate the overall level of resistance in the general population, it is certainly going to discourage any people who are caught up in the festival aspect of the resistance from continuing.  The real and present threat of violence and death is a great deterrent; it is not a coincidence that tyrannical governments across the globe and throughout history have made effective use of violence in putting down discontent.  While it will cement the resolve of the committed and work to increase the number of people who have suffered significant enough indignity and hardship to risk their lives, a large number of people will be too fearful to support the resistance and will in fact look to establish their own safety by actively helping the establishment root out the resistance.

Along with direct force there are force multipliers like air support, heavy weapons, command and control capabilities, control over the infrastructure, night vision and infrared tracking, satellite surveillance, the network of in place surveillance and traffic cameras, body armor, on-line intercepts of emails, phone taps, the ability to shut down transportation systems, forensic analysis, and training.  How does a single citizen cope with the myriad ways in which the governing authority can deploy massive resources and multiply their effectiveness?  When he realizes that he must join with others to pool resources and capabilities, how does he find or recruit his team without leaving a trace that will be detected by the government or co-opted to its benefit?  It is, to say the least, a daunting challenge.

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Non-defense government (federal, state, and local) consumption and gross investment as percentage of GDP, 1929-2008

Anyone who has ever gone on an extended hike in the wilderness has come face to face with the importance and the challenge of logistics.  Like a rocket that uses 90% of the fuel to lift the fuel that lifts the rocket into orbit, a hiker must carry more food to offset the extra energy expended by carrying a heavy load of food onto the trail.  Furthermore, any tools or materials he needs must be carried along if they cannot be fabricated or acquired along the way, so if the hiker has any desire to do much more than walk (eg. take pictures, drink, sleep, cook, or bandage a cut), he has to carry the means to do so along with him.

For that reason the modern day resistance movement will begin as a largely local phenomenon.  People cannot afford to deploy themselves to faraway places and risk their source of income and/or support the additional expense.  There will necessarily need to be help in the form of food, medicine, shelter, and materials above and beyond what the average resister will be able to provide, and that lifeline of support is easily constrained or severed by the power in authority.

Conversely the government in all of its forms and agencies has nearly unlimited resources (at least in the short to medium term) in the form of cash, supplies, transportation, and secure storage to support its activities.  It rules the air and roads and sea and rails, and it can deploy immense amounts of resources in a short period of time if needed.  Furthermore there is no opportunity for any single citizen to limit the reach and ability of the government to deploy those resources.  It is simply the case of only being able to stop one grain of sand in a landslide.

The powers that be also have complete authority and control over all of the major channels of communication.  They can manipulate, halt, or utilize all TV, radio (broadcast), newspaper, internet, radio (point to point), telephone, snail mail and satellite communications at will.  They can monitor, intercept, jam, encrypt or decrypt nearly any message that a modern day citizen can compose.  That leaves the resister the option of sending messages that are very difficult to hide and protect, or sending messages that travel at very slow speeds by off the grid methods.

Hand in hand with the ability to communicate is the ability to coordinate.  Existing agencies have command and control structures in place that allow orders from leadership to be executed quickly and reliably.  Those agencies have extensive practice and established methods for preserving their chain of command and those in the chain are well versed in the execution of the orders they receive.  The command structure is redundant and well insulated from the agents in the field of operations, and is virtually immune to any action on the part of the citizen that has chosen to resist.

That citizen in turn is working with other autonomous people and groups (if he is working with anyone at all) who’s participation is completely voluntary.  They may agree to carry out the requests he makes, but they may only agree to part of the action.  They may decide to change the time table.  They may decide to back out without notice.  Or they may become otherwise engaged and be limited in the sense of accountability they feel and/or be limited in their ability to communicate their change in direction.  It is very easy to take out the leadership since the leadership is also likely to be the operator in the field.  There is little or no redundancy, and there is little or no practice in cooperative action.  Furthermore the more cooperative and effective the group becomes, the more likely they are to become a target of strategic priority by the forces of the powers in place.

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The last major category of strength this analysis will address is financial.  Despite the overwhelming debt, the deficits, and the lack of solvency in the government at the federal, state, and local levels the fact remains that the financial powers can (and will) continue to create money to fund their activities.  There are many questions about whether or not this course of action is sustainable or effective; however, there is little doubt that it will continue.  The wealth of the United States is tremendous, and even though it is being steadily diluted by the devaluation of the dollar, there remains an enormous amount of wealth yet to dilute.  Consider that the total notional wealth of the United States is around $56T.  Even maintaining budget deficits that are funded by printing new dollars, it would take around 30 years to consume the wealth through the expansion of the currency.

Now I know that it is a good bit more complicated than that; however, the fact remains that there is massive wealth left that can be consumed.  Furthermore it is likely that the existing debt will be defaulted and wiped out.  While there are numerous disruptions inherent is such a scenario the government will be free of its encumbrances and will be able to continue to print new money (even if it is called something else or initially backed by other assets).  What this means is that for all practical purposes the government will remain unconstrained in its spending while the average citizen will be anything but.  More importantly, as the government creates more and more money, the wealth of the citizen will continue to decline further limiting him from saving or deploying his assets towards effective resistance even as the devaluation creates more and more people desperate enough to consider action.

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An average citizen faces an enormous, frightening and disheartening challenge if he chooses to resist; however, that has always been true throughout history when the brave and often tragic souls of the past have decided that enough was enough.  No government in world history has lasted very long; most have failed in a much shorter span than the United States has lasted.  Neither success nor failure is baked in the cake.  In the next part, we will look at the inherent strengths that the average citizen has in resisting the existing authority.

BAD MOON RISING

I see the bad moon arising.
I see trouble on the way.
I see earthquakes and lightnin’.
I see bad times today.

Creedence Clearwater Revival – Bad Moon Rising

 

“Human history seems logical in afterthought but a mystery in forethought.” – The Fourth Turning – Strauss & Howe

The above statement by historians William Strauss and Neil Howe is very significant as we try to make sense of the events unfolding before our very eyes in today’s world. On September 17, a mere six weeks ago, a few hundred young people showed up in Zucatti Park in Lower Manhattan to protest our corrupt, broken and Wall Street manipulated economic and political system. That first night, approximately 100 protestors occupied the park and were outnumbered by the NYPD in full riot gear. The idea to Occupy Wall Street began circulating on the internet in late August. The Millennial Generation used their social networks and put their tech savvy talents to work. Before long, thousands of protestors showed up in cities across the U.S. The model for this movement was the successful demonstrations in Egypt and Tunisia, earlier in the year.

 

The initial reaction among mainstream media and politicians across the land was bemusement. A bunch of young hippy throwbacks were going to make a meaningless statement and then fade away. The attention span of Americans is as long as the commercial break between contestants on Dancing With the Stars. Everyone knows the Millennials aren’t to be taken seriously. They are a bunch of spoiled, coddled, lazy college kids who need to get a job. But a funny thing happened during the commercial break. The kids held their ground. They didn’t leave. More young people arrived. More young people began protesting in cities across the country. Middle aged people began to get involved. Even some older people joined the cause. Before long there were thousands of people getting involved. It spread to Europe, with young people occupying London and Rome. Donations and supplies began to pour in from around the world. There’s something happening here, but what it is ain’t exactly clear.

The six weeks since September 17 have been chaotic, venomous, confusing, and verging on deadly. Wall Street gyrated wildly with stocks falling 8% by October 3 and rebounding by 15% by October 28 and plunging again this week. The Economic Cycle Research Institute (ECRI) declared the country was headed back into recession on September 30:

“It’s important to understand that recession doesn’t mean a bad economy – we’ve had that for years now. It means an economy that keeps worsening, because it’s locked into a vicious cycle. It means that the jobless rate, already above 9%, will go much higher, and the federal budget deficit, already above a trillion dollars, will soar. Here’s what ECRI’s recession call really says: if you think this is a bad economy, you haven’t seen anything yet. And that has profound implications for both Main Street and Wall Street.”

The ECRI has called the last three recessions with no instances of false alarms. Last week, the Conference Board announced the Consumer Confidence Index plummeted to two and a half year low of 39.8, last seen in March of 2009. The Dow Jones was trading at 6,500 in March 2009, some 47% below today’s level. It is an interesting dichotomy between how the average American feels about the world and how the Wall Street elite feel about their Ben Bernanke sheltered world. The Consumer Confidence Index was 110 in 2007 and 140 in early 2001. We’ve come a long way baby.

During these past six weeks the European Union has teetered on the verge of disintegration. Non-stop negotiations, agreements, plans, declarations, special purpose vehicles, bailout funds, and lies have poured forth on a daily basis. Greece still lives – on a ventilator – as it has been brain dead for months. The sole purpose of all the public relations efforts, press conferences, summit meetings and lies has been to keep European banks, their stockholders and bondholders from accepting the consequences of their irresponsible lending to the PIIGS. Essentially, the German people have been put on the hook for losses that should have been born by the stockholders and bondholders of the biggest French, German, Belgian and English banks. The EU has put a tourniquet over a cancerous tumor. The entire world is awash in bad debt and until this debt is liquidated, we will stagger from crisis to crisis like a drunken sailor. John Hussman describes the master plan:

In effect, European leaders have announced “We have agreed to solve our debt problem, leveraging money we do not have, to create a fund, which will then borrow several times that amount, in order to buy enormous amounts of new debt that we will need to issue.”

As politicians and central bankers around the world desperately try to keep their debt drenched ponzi scheme going for awhile longer, the mood darkens among the populations of developed countries around the world. I came across a quote from, of all people, Vladimir Lenin that describes how the last six weeks seemed to me: 

“There are decades where nothing happens; and there are weeks where decades happen.”

It seems like history is accelerating. Momentous events have been occurring regularly since 2007. Our political and financial leaders are blindsided on a daily basis by each new crisis. The majority of the American public continues to be apathetic, willfully ignorant, and constantly absorbed by their array of electronic gadgets and mindless drivel spewed at them by media conglomerates. Rather than think critically, most Americans allow left wing and right wing mainstream media to formulate their opinions for them through their propaganda and misinformation operations. Linear thinkers, who make up the majority of the political, social, media and financial elite in this country, believe the world progresses and moves ever forward. In reality, the world operates in a cyclical fashion, with generations throughout history reacting to events in a predictable manner based upon their stage in life. The reason the world has turned so chaotic, angry and fraught with danger since 2007 is because we have entered another Fourth Turning. Strauss & Howe have been able to document a fourfold cycle of generational types and recurring mood eras in American history back 500 years. They have also documented the same phenomenon in other countries.

The housing collapse, near meltdown of our financial system, revolutions in the Middle East, economic turmoil in Europe, poisoned political atmosphere in Washington DC, and most recently the Occupy Wall Street movement are part of a larger cycle. The four living generations have each entered the phases of their lives that will lead to a convulsive upheaval and destruction of the existing social order. We’ve entered a twenty year period of Crisis as described by Strauss & Howe:

“A CRISIS arises in response to sudden threats that previously would have been ignored or deferred, but which are now perceived as dire. Great worldly perils boil off the clutter and complexity of life, leaving behind one simple imperative: The society must prevail. This requires a solid public consensus, aggressive institutions, and personal sacrifice. People support new efforts to wield public authority, whose perceived successes soon justify more of the same. Government governs, community obstacles are removed, and laws and customs that resisted change for decades are swiftly shunted aside. A grim preoccupation with civic peril causes spiritual curiosity to decline. Public order tightens, private risk-taking abates, and crime and substance abuse decline. Families strengthen, gender distinctions widen, and child-rearing reaches a smothering degree of protection and structure. The young focus their energy on worldly achievements, leaving values in the hands of the old. Wars are fought with fury and for maximum result.” – Strauss & Howe

History is Cyclical, not Linear

“There is a mysterious cycle in human events. To some generations much is given. Of other generations much is expected. This generation of Americans has a rendezvous with destiny.” – Franklin Delano Roosevelt  

  

I’ve been trying to decipher which direction this Fourth Turning will lead, and the last six weeks has started to crystallize my thinking. I’ve been fascinated by the intense reactions, opinions and arguments that have taken place across the airwaves and internet regarding the true nature of the Occupy movement. Some of the reaction is based upon pure ideological grounds, with media outlets like Fox News, the Wall Street Journal, NY Post and CNBC, disparaging, ridiculing and demeaning the movement. The anti-rich tone of the protests may not sit well with the multi-billionaire owners (Rupert Murdoch, Mort Zuckerman, Roberts Family) of these mega-media corporations. The liberal media such as MSNBC, Huffington Post, and CNN have sometimes been fawning over the movement in an effort to co-opt it into liberal Tea Party for the benefit of Obama and the Democratic Party. The propaganda and misinformation coming from both these ideological camps is easy to discern for a critical thinking person. Sadly, the nation is filled with people that don’t want to think. Therefore, they let their opinions be formed by talking heads on a TV screen.

These reactions were predictable. What caught my attention was the generational reaction to Occupy Wall Street. I know all the rugged individualists out there chafe at being lumped into a generational cohort, but the fact remains that groups of people born during the same time frame encounter key historical events and social trends while occupying the same phase of life. Because members of a generation are molded in lasting ways by the eras they encounter as children and young adults, they also tend to share certain common beliefs and behaviors. Aware of the experiences and traits that they share with their peers, members of a generation also tend to share a sense of common perceived membership in that generation. To deny the reality that large clusters of human beings tend to act with a herd mentality is contrary to all visible evidence. The herd mentality can be observed in the Dot-com bubble, Americans unquestioningly allowing passage of the Patriot Act, the housing bubble, the mass hysteria over the latest iSomething, Black Friday riots at retail stores to obtain the “hottest” toy or gadget, and the slaves to the latest fashions and trends as directed by the corporate media machine. The masses don’t realize they are being manipulated by the few who understand the power of propaganda:

“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 Occupy movement is being driven by the Millennial Generation. They have used their superior technological and social networking skills to organize, educate, and inspire people to their cause while befuddling and confusing the authorities. They continue to rally more young people to their fight against Wall Street and K Street tyranny. The generational lines of battle are being drawn. The Baby Boom Generation, who is at the point of maximum power in society, fears this movement. They control Wall Street, corporate America, Congress, the courts, academia and the media. They have reached their peak of influence and power, which will rapidly wane over the next fifteen years. They see the Occupy movement as a threat to their supremacy and control of the system. The cynical, alienated, pragmatic Generation X is caught between the Boomers and the Millennials in this escalating conflict. It is likely the majority of this generation will side with the Millennials, realizing the future of the country depends on them and not the elderly Boomers. To clarify, not every Boomer, Gen Xer, or Millennial will act in concert with their generational cohort. But it doesn’t matter if a few cattle stray from the herd, when the herd is stampeding in one direction.

The chart below details the Strauss & Howe configuration of generations and turnings for the last two Saeculums in American history. They describe their generational theory in the following terms:

“Turnings last about 20 years and always arrive in the same order. Four of them make up the cycle of history, which is about the length of a long human life. The first turning is a High, a period of confident expansion as a new order becomes established after the old has been dismantled. Next comes an Awakening, a time of rebellion against the now-established order, when spiritual exploration becomes the norm. Then comes an Unraveling, an increasingly troubled era of strong individualism that surmounts increasingly fragmented institutions. Last comes the Fourth Turning, an era of upheaval, a Crisis in which society redefines its very nature and purpose.” – Strauss & Howe

Each new generation is born approximately three years prior to the next turning. This results in Strauss & Howe having a slightly different generational grouping than government demographers.

Great Power Saeculum (82)
Missionary Generation Prophet (Idealist) 1860–1882 (22) High: Reconstruction/Gilded Age
Lost Generation Nomad (Reactive) 1883–1900 (17) Awakening: Missionary Awakening
G.I. Generation Hero (Civic) 1901–1924 (23) Unraveling: World War I/Prohibition
Silent Generation Artist (Adaptive) 1925–1942 (17) Crisis: Great Depression/World War II
Millennial Saeculum (67+)
(Baby) Boom Generation Prophet (Idealist) 1943–1960 (17) High: Superpower America
13th Generation Nomad (Reactive) 1961–1981 (20) Awakening: Consciousness Revolution
(a.k.a Generation X)
Millennial Generation(Generation Y) Hero (Civic) 1982–2004 (22) Unraveling: Culture Wars, Postmodernism, Digital Technology
New Silent Generation (Generation Z) Artist (Adaptive) 2004–present (6+) Crisis: Great Recession, War on Terror, Declining Superpower, and Globalization

There is nothing mystical about their theory. Strauss & Howe are historians who have created a framework for understanding why people act a certain way to events differently, depending on which stage of life they occupy. The theory is so logical because it is based upon the average 80 year life cycle of a human being. A human being goes through four stages during their life: childhood, young adulthood, midlife, and elderhood. During each of these stages, you will react to the same event in a very different manner. During an 80 year cycle, there will be four generations at different stages of their life. The interaction between the generations at each 20 year turning determines how history is steered through the events of that cycle. The life cycle stages can be seen in this chart:

  Prophet Nomad Hero Artist
High Childhood Elderhood Midlife Young Adult
Awakening Young Adult Childhood Elderhood Midlife
Unraveling Midlife Young Adult Childhood Elderhood
Crisis Elderhood Midlife Young Adult Childhood

Strauss and Howe compare the saecular rhythm to the seasons of the year, which inevitably occur in the same order, but with slightly varying timing. Just as winter may come sooner or later, and be more or less severe in any given year, the same is true of a Fourth Turning in any given Saeculum. The theory does not predict the events which drive history, but it does predict the generational reaction to events depending upon their age. We entered the Fourth Turning Crisis in 2007 with the housing collapse and the implosion of our financial system. The configuration of elder self righteous Boomers at 60 years old, midlife pessimistic Gen Xers at 40 years old, and coming of age Millennials at 20 years old is an explosive mixture that will provide the impetus and fury to this period of catharsis and pain. Winter has arrived. There is no way to avoid it. The bitter winds have begun to blow. The first harsh front arrived in 2008 with the near meltdown of the worldwide economic system. There has been a lull in the biting gale force winds of this Crisis through the shoveling of massive amounts of newly created debt into a system already drowning in debt. The Occupy movement and the impending collapse of the European Union charade will usher in the next blizzard of pain and suffering. We hurdle towards are rendezvous with destiny.

“The ‘spirit of America’ comes once a saeculum, only through what the ancients called ekpyrosis, nature’s fiery moment of death and discontinuity.  History’s periodic eras of Crisis combust the old social order and give birth to a new. A Fourth Turning is a solstice era of maximum darkness, in which the supply of social order is still falling—but the demand for order is now rising.  It is the saeculum’s hibernal, its time of trial. Nature exacts its fatal payment and pitilessly sorts out the survivors and the doomed.  Pleasures recede, tempests hurt, pretense is exposed, and toughness rewarded—all in a season.” – Strauss & Howe

Millennials Rising

Over the last six weeks I’ve watched as the young protestors around the country have been called: filthy hippies, losers, lazy, coddled, socialists, communists, spoiled college kids, parasites, useful idiots, and tools of the left. Most of the wrath being heaped upon these young people for exercising their Constitutional right to free speech and freedom of assembly has been from the Baby Boom Generation, who are at the peak of their power in our society. Sixty percent of the Senate is made up of Baby Boomers, with the next closest generation being the Silent Generation with twenty five percent. Over 58% of the House of Representatives is made up of Baby Boomers, with the next closest generation being Gen Xers at 27%. They occupy the executive suites of the Wall Street banks (Blankfein, Dimon, Pandit, Monihan) and the Federal Reserve (Bernanke). They make up the majority of judges, local politicians and school boards. They run the Federal government agencies. And they dominate the airwaves as the high priced mouthpieces for their corporate bosses. This Prophet generation will lead the country through the trials and tribulations of this Fourth Turning.

The disdain and contempt for these Millennial protestors flies in the face of the facts about this generation. They use drugs at a lower rate than their parents did at the same age. Teen crime rates and teen pregnancies have declined. They will have the highest level of college education in U.S. history. They were protected during their youth as organized sports taught them teamwork. They are the most technologically savvy generation in history. They volunteer at a higher level than previous generations. They have been more upbeat and engaged than their predecessors (Gen X). And they are much closer to their parents than Boomers were at the same age. They reject the negativism and cynicism of their parents and believe positive change is possible in our society. They have shown respect for authority up until the last six weeks. They were primed to be led by Boomers that could articulate a positive vision of the future based on reality and a better tomorrow. They were ready to make sacrifices in order to create a brighter future. But a funny thing happened. The Boomer generation failed to deliver on their part of the bargain.

Prior Hero Generation Americans had braved the winter at Valley Forge and stormed the beaches of Normandy as Prophet leaders like Ben Franklin and Franklin Roosevelt provided inspirational guidance and the vision of a better tomorrow. Strauss & Howe accurately assessed the Millennial Generation in their book Millennials Rising: The Next Great Generation, published in 2000 when the 1st Millennials were graduating high school:

“As a group, Millennials are unlike any other youth generation in living memory. They are more numerous, more affluent, better educated, and more ethnically diverse. More important, they are beginning to manifest a wide array of positive social habits that older Americans no longer associate with youth, including a new focus on teamwork, achievement, modesty and good conduct. Only a few years from now, this can-do youth revolution will overwhelm the cynics and pessimists … will entirely recast the image of youth from downbeat and alienated to upbeat and engaged — with potentially seismic consequences for America.” – Strauss & Howe

The youth of America listened to their parents and stayed in school. They’ve racked up over $1 trillion in student loan debt getting college educations. Meanwhile, our Baby Boomer leadership had an opportunity to address the country’s unsustainable fiscal path by accepting the consequences of a thirty year debt binge and liquidating the banks that took extreme risks with extreme leverage. An orderly liquidation (aka Washington Mutual) would have punished the stockholders, bondholders and management of the Wall Street banks, while leaving the depositors whole and purging the system of debt that can never be paid off. Our politicians could have ended our wars of choice in the Middle East and cut our war spending by hundreds of billions without sacrificing one iota of safety for the American people. The political leadership could have put the country on a deficit reduction path that would have insured the long-term viability of our republic.

Instead of doing the right thing, our Baby Boomer leaders did the exact opposite of the right thing. They held the American taxpayer hostage and absconded with trillions of their tax dollars and handed it over to the same Wall Street banks that had run the largest fraud scheme in world history and blew up the worldwide financial system. The Boomer Chairman of the Federal Reserve decided to not only save the Wall Street banks but to purposefully try to pump up the stock market, while destroying the lives of savers and senior citizens with his zero interest rate policy. His policies have led to a surge in energy and food prices and contributed to revolutions in the Middle East. The Wall Street banks have used the accounting gimmick of relieving loan loss reserves to create fake profits over the last two years. Wall Street celebrated by paying themselves $60 billion in bonuses between 2008 and 2010. The poster boys for the .1% Jamie Dimon and Lloyd Blankfein “earned” $23 million and $19 million respectively in 2010.

The politicians borrowed trillions from future unborn generations to inflict a Keynesian nightmare of solutions on the American economy that included: an $800 billion porkulus program, $22 billion pissed down the toilet on a homebuyer tax credit as home prices are now lower, $3 billion for Cash for Clunkers that cost $24,000 per car sold, loan modification schemes, tax credits for windows, doors and appliances, and payroll tax cuts. The result of all the Federal Reserve and politician “solutions” has been to increase the National Debt by $5.3 trillion in three years, a 55% increase. It took the country over 200 years to accumulate the first $5.3 trillion in debt. Everything done thus far has benefitted only the top 1%. The real unemployment rate is 23%. The real inflation rate is between 5% and 10%. The economy is headed back into recession. But at least the top 1% are doing well, as the stock market has risen 84% from its 2009 lows. Somehow, the oligarchy that runs this country is taken aback by the protests growing increasingly contentious across the country. It is not a surprise to those who understand the cyclical nature of history and the darkening mood in this country, which has been deepening since the Tea Party protests of 2009.

Hope You Are Quite Prepared To Die

Hope you got your things together.
Hope you are quite prepared to die.
Looks like we’re in for nasty weather.
One eye is taken for an eye.

Creedence Clearwater Revival – Bad Moon Rising

  

It seems the young people in this country have realized they have no future when the system is run for the benefit of an oligarchy consisting of Wall Street banks, mega-corporations, media conglomerates, and puppet politicians in Washington D.C. These people will stop at nothing to retain their wealth and power. Not only do they want to retain it, they are actively trying to increase it. They have achieved their goal beyond all expectations, and are still able to convince a large portion of the population through their propaganda machine they deserve every penny. The chasm between the “Haves” and “Have Nots” has never been greater in U.S. history. The truth is that Americans have always admired entrepreneurs like Steve Jobs and Bill Gates who created businesses, created jobs, and ended up with vast wealth. But, that is not the wealth protestors on Wall Street and across the country are angry about. They are angry at the hyper-concentration of wealth in the hands of men that have rigged the system in their favor through bribery (lobbying & contributions), fraud (no-doc loans & AAA rated toxic derivatives), accounting schemes (special purpose vehicles & suspending mark to market) and holding the American middle class hostage (TARP & zero interest rates). When the 400 wealthiest Americans own more than the “lower” 150 million Americans put together, you have a system that is badly broken.

Do the Millennials have a right to be angry? The table below shows how the economic solutions of the oligarchy have worked out for the youth of our country. There are 19 million young people between the ages of 18 and 29 that are not working. Some are still in college, but most are not. That is a lot of potential Occupiers.

Age Group %  not employed
18 to 19 65%
20 to 24 40%
25 to 29 27%

After observing the reactions to the OWS movement over the last few weeks, I’m more convinced than ever that different generations view the same event through the prism of their own life experiences, beliefs, prejudices, and biases. I’ve found the Baby Boomers have generally been doubtful of the protestors’ motives, condescending towards their intelligence, scornful about their appearance, and derogatory regarding their flaunting of authority. This is fascinating considering that Boomers love to reminisce about their glory days protesting the Vietnam War. The Boomer generation was at this same age configuration in 1970. Their GI Generation parents probably had the same opinions about the long haired, drug using, sex crazed youthful Boomers in 1970. Now the Boomers are the establishment and they don’t like seeing their authority challenged by these naïve troublemakers. Strauss & Howe saw the likelihood of this conflict back in 1997 when the oldest Millennials were only 15 years old:

“When young adults encounter leaders who cling to the old regime (and who keep propping up senior benefit programs that will by then be busting the budget), they will not tune out, 13er-style. Instead they will get busy working to defeat or overcome their adversaries. Their success will lead some older critics to perceive real danger in a rising generation perceived as capable but naïve.” –  Strauss & Howe

The Millennials spearheading these protests are most certainly capable. In a matter of six weeks they have created a worldwide movement occupying every major city in the world. The biggest complaints coming from the Boomers is they are naïve, misguided, immature, and don’t understand the real problem. The bitter condemnation of the protestors for breaking a myriad of minor administrative laws, regulations, ordinances, and curfews is beyond laughable. Fox News, CNBC, the Wall Street Journal, NY Post and the other mouthpieces of the ruling oligarchy are apoplectic about the young protestors camping out in public parks, but they were not too concerned by the Wall Street banks systematically defrauding millions of people by creating mortgage products designed to deceive.

They weren’t irate when Wall Street held Congress hostage for a $700 billion ransom. They weren’t enraged when Ben Bernanke bought a trillion dollars of toxic mortgage debt from the Wall Street banks at 100 cents on the dollar. They weren’t furious when the government officials forced the FASB to abandon mark to market rules, allowing the Wall Street banks to falsely report their financial statements. But, they are outraged by young people exercising their right to free speech and right to assembly. When their paid armies of thugs attack the protestors with tear gas and billy clubs, they declare the protestors had it coming. It seems the 150 year old American tradition of civil disobedience to protest unjust laws, defined by Henry David Thoreau, is not too popular among Boomers or the corporate mainstream media.

“Unjust laws exist: shall we be content to obey them, or shall we endeavor to amend them, and obey them until we have succeeded, or shall we transgress them at once?” –  Henry David Thoreau 

Many of the protestors are naïve, misinformed about the true causes of the financial crisis, impulsive, and seeking solutions that would result in more government control. Their critics say they should be in Washington DC, not on Wall Street. The Boomers don’t like their flaunting of rules and regulations imposed by local authorities. Again, the older generations have conveniently forgotten how naïve, impulsive and rebellious they were at the age of 20. The amazing thing to me is this generation never showed this side during their younger years. Their slogans like “Tax the Rich” are misguided. They need assistance from older generations, but instead they are getting beaten and arrested by the older generation. Some Boomers, like William Black, have opened a dialogue with the protestors, but the majority of Boomers are resistant to the movement. In prior Fourth Turnings, the Hero archetype followed the orders of the Prophet archetype. I fear the Boomer Generation, through their intransigence and refusal to proactively address our structural problems, have set in motion a revolutionary chain of events that will lead to class warfare and possibly civil war in this country. The real danger, as experienced in other countries (France, Russia, China), is that a demagogue could gain control. Strauss & Howe envisioned that possibility in 1997:

“This youthful hunger for social discipline and centralized authority could lead Millenial youth brigades to lend mass to dangerous demagogues. The risk of class warfare will be especially grave if the 20% of Millenials who were poor as children (50% in the inner cities) come of age seeing their peer-bonded paths to generational progress blocked by elder inertia. Unraveling era adults who are today chilled by school uniforms will be truly frightened by the Millennials’ Crisis-era collectivism.” –  Strauss & Howe

The most outrageous accusation made against the protestors is they are somehow responsible for their current plight. The Boomers declare they are spoiled kids who need to get a job. A critical thinking analysis of the Millennial Generation demographics reveals how ridiculous it is for Boomers to blame Millennials in any way for our current economic debacle. There are 97 million Millennials and 54 million of them are under the age of 20. Another 21 million are between the ages of 20 and 24, barely getting started in the real world. Only 39 million of them were eligible to even vote in the last Presidential election. It should be clear to even the most dense CNBC anchor that the young people protesting in the streets are not to blame for the raping and pillaging of the U.S. economic system by the barbarians on Wall Street over the last thirty years, with the consent and encouragement of the bought off politicians in Washington D.C.

Generation Age Total Pop.(mil)
G.I. 86–109 6
Silent 69–85 22
Boomer 51–68 73
Gen-X 30–50 83
Millennial 7–29 97
Homeland – 6 29

After placing the living generations in their assigned age buckets, I was shocked to see the Millennials being, by far, the largest generation. I had assumed it was the Baby Boom Generation. At their peak in 1970 they totaled 76 million and made up 37% of the U.S. population. But, time has not treated them well. Approximately 3 million have left this earth and they only make up 24% of the population. Both Gen X and the Millennials now outnumber the Baby Boomers. They will continue to see their power wane as the years roll by. The Millennial power will grow as the Fourth Turning progresses, since they make up 31% of the population today and will see that ratio grow as the G.I. and Silent generations die off. There are very few people remaining that lived through the last Fourth Turning. The initial phase of this Crisis has revolved around the Wall Street induced housing collapse with the consequences of not enforcing the rule of law by liquidating insolvent banks and prosecuting the white collar criminals that reaped ungodly profits by committing fraud on an epic scale. This has left the country with an unsustainable level of debt, a hollowed out economy, and unemployment at Great Depression era levels, while Wall Street bankers, media titans, and career politicians reap compensation packages fit for kings. Jesse from Jesse’s Café Americain describes our political system perfectly: 

Kleptocracy:“rule by thieves” is a form of political and government corruption where the government exists to increase the personal wealth and political power of its officials and the ruling class at the expense of the wider population, often without pretense of honest service.No outside oversight is possible, due to the ability of the kleptocrats to personally control both the supply of public funds and the means of determining their disbursal. 

The Millennials were raised by parents who believed government could solve all our problems. The welfare-warfare state became monolithic during the Boomer reign of error. Therefore, it is understandable these young naïve revolutionaries still cling to the belief the government can solve our problems through more taxes or new programs. The point being missed by all the doubters and detractors of the OWS movement is these young people have zeroed in on the right culprits. They are not stupid. They understand these basic facts:

  • The $15 trillion National Debt, headed to $20 trillion by 2015, is the gift we are leaving to the Millennials.
  • The $100 trillion of unfunded entitlement liabilities will never be honored by the time the Millennials retire.
  • The Millennials know the $1 trillion per year spent maintaining our military empire is more than the next 18 countries’ spending combined, and it benefits only the corporations peddling armaments, while making us less safe.
  • The soldiers getting killed and wounded in our wars of choice in the Middle East are predominantly Millennials.
  • There are 14,000 professional lobbyists in Washington D.C. representing mega-corporations, unions, trade groups and other special interests, which have doled out $30 billion over the last decade influencing (bribing) politicians to write the laws in their favor, and not one lobbyist was working for the Millennials.
  • Millennials know Wall Street has spent $154 million on political contributions and $383 million on lobbying in the last decade. The buying of political influence by our bastions of crony capitalism was as follows: Goldman Sachs – $46 million; Merrill Lynch – $68 million; Citigroup – $108 million; J.P. Morgan Chase – $65 million; Bank of America – $39 million.
  • The Millennials know the 71,000 page Federal tax code and 140,000 pages of Federal regulations are written to protect the interests of the few, not the many.
  • Millennials know the financial industry consciously created products designed to induce mortgage fraud, knowingly packaged toxic mortgages into derivatives, bribed the rating agencies to rate them AAA, sold these worthless instruments to their customers, shorted these same derivatives, and pocketed billions in fees and ill gotten gains. After blowing up the financial system and costing taxpayers trillions, not one person has gone to jail.
  • Millennials know how to read a chart:

  • Millennials know that Barack Obama and Mitt Romney are the same face of a never changing oligarchy. Change brought about through opposing political parties and elections has been rendered obsolete as the oligarchy chooses the candidates, uses their wealth to create policies and programs, and is able to control the masses with their propaganda message machines.

So here we stand, about five years into this Fourth Turning, with protests in the U.S. growing increasingly violent and intense. The calls for civility after the Gabrielle Giffords assassination attempt in January of this year went unheeded as the political vitriol has grown increasingly nasty. January seems like a lifetime ago. Revolutions have overthrown rulers in Tunisia, Egypt, and Libya. Unrest and bloodshed continues in Syria, Gaza, Yemen, Bahrain and Saudi Arabia. The European Union is disintegrating before our very eyes and violent protests against austerity measures flare up on a daily basis in Greece, Italy and Spain. There is no doubt we have entered the 2nd stage of this Crisis – the more violent and dangerous stage. I can sense fear and uneasiness among the more connected members of society. The drones, which constitute a large portion of America, are highly focused on Kim Kardashian’s divorce after 72 days and a $10 million wedding. The Millennials leading the protest movement are connected. They understand what is at stake. Strauss and Howe had it figured out 14 years ago:

“Of all today’s generations, the Millenials probably have the most at stake in the coming Crisis. If it ends badly, they would bear the full burden of its consequences throughout their adult lives. Yet if the Crisis ends well, Millenials will gain a triumphant reputation for virtue, valor and competence.” – Strauss & Howe

So what happens next? The truth is that no one knows what will happen next. We can only try to connect the dots and peer into a foggy future. We know that our leaders have not solved any of the financial imbalances that existed in 2007. They have made them worse, as have leaders across the world from China to Japan to Europe. We await the next Lehman moment, except this time it will be a sovereign nation and the contagion will be ten times greater than the 2008 meltdown. Our already fragile economy will be brought to its knees in a replay of the 1930s. As nations plunge into economic chaos, civil strife will likely lead to authoritarian figures rising from the ashes of the turmoil. Could Russia and China take advantage of this turmoil to acquire new resources through military means? Possibly. When the American middle class sees their remaining wealth dwindle to nothing, will they take to the streets? Revolution seems too remote to fathom, but it seemed remote in 1764 and 1855 too. When people have nothing left to lose, anything is possible. The collapse of our economic system is baked in the cake. Our current fiscal path is destined to end in fatality. Strauss & Howe knew the outcome of this Fourth Turning would depend upon the wisdom, strength and fortitude of the American people:

 “The risk of catastrophe will be very high. The nation could erupt into insurrection or civil violence, crack up geographically, or succumb to authoritarian rule. Thus might the next Fourth Turning end in apocalypse – or glory. The nation could be ruined, its democracy destroyed, and millions of people scattered or killed. Or America could enter a new golden age, triumphantly applying shared values to improve the human condition. The rhythms of history do not reveal the outcome of the coming Crisis; all they suggest is the timing and dimension.” – Strauss & Howe

Winter has arrived. There will be difficult hurdles with many trials and tribulations in front of us. You may have to choose sides in a generational war. No one wants to face bitter choices. No one wants bloodshed and war. But it really doesn’t matter what we want. There is no real justice in a country that attacks and incarcerates young people for exercising their right to free speech and dissent, while allowing a psychopathic Wall Street banking cartel to wreak havoc upon our nation. The generational alignment is such that the existing social order will be swept away in a violent manner. What replaces the existing order will be up to the American people. You may lose your wealth, security, freedom, or life during the coming struggle. The years ahead will require steely determination and courage like our forefathers exhibited on the frigid barren fields at Valley Forge, the undulating wheat fields at Gettysburg, and the bloody beaches of Normandy. I have three teenage sons at home. My choices will be dictated by what I feel will be best for their futures. I will do WHATEVER it takes to secure a better tomorrow for my boys. If that means standing beside them in battle, so be it. Lines are being drawn. You will not be able to avoid choosing sides, just as you cannot avoid Winter if you ever want to see the dawn of another Spring.

 

“History offers no guarantees. We should not assume that Providence will always exempt our nation from the irreversible tragedies that have overtaken so many others: not just temporary hardship, but debasement and total ruin. Since Vietnam, many Americans suppose they know what it means to lose a war. Losing in the next Fourth Turning, however, could mean something incomparably worse. It could mean a lasting defeat from which our national innocence – perhaps even our nation – might never recover.” – Strauss & Howe

 

WHAT THIS COUNTRY NEEDS NOW IS HOPE

Finch: Why are you doing this?
Evey Hammond: Because he was right.
Finch: About what?
Evey Hammond: That the world needs more than just a building right now. It needs hope.

  

The dialogue above occurred at the end of the dystopian movie V for Vendetta. It is a tale of revenge and restoring hope among citizens who had chosen safety and security over freedom and liberty. Even though this movie was fictional and adapted from a comic strip, its message and warnings should be heeded. Millions of middle class citizens in the U.S. sink deeper into despair every day. Day by day hope is being lost that the future for our children will be better than our past. The political, financial, and corporate leaders of our country are intellectually and morally bankrupt. The major Wall Street banks are bankrupt. Social Security is bankrupt. Medicare is bankrupt. The whole damned world is bankrupt. Anyone with an unbiased view of our planet would conclude that we are in unfathomable danger. The list of impending catastrophic issues that will blow up the world for millions in the U.S. and across the globe is virtually endless:

U.S. Debt

  • The national debt is currently $14.6 trillion, up from $5.7 trillion in 2000. It took over 200 years to accumulate the first $5.7 trillion of debt and only 11 years to tack on another $8.9 trillion.
  • With the new $450 billion jobs package proposed by President Obama, the deficit in FY12 will likely exceed $1.8 trillion, or 12% of GDP. Greece’s 2010 deficit was 10.5% of GDP.
  • Kenneth Rogoff and Carmen Reinhart in their book This Time is Different: Eight Centuries of Financial Folly, using data from 44 countries over 200 years, concluded that once a country’s national debt exceeds 90% of GDP, the economy stagnates and ultimately makes that country vulnerable to a debt crisis. The U.S. national debt as a percentage of GDP is currently 97% and will reach 107% in 2012. This does not count state and local debt, Fannie Mae and Freddie Mac debt, and the unfunded liabilities for Social Security and Medicare. We are at the same place Greece was in 2007. But we’re no Greece, right? This time is different.

 

  • Total credit market debt of $52.5 trillion is 3.5 times GDP, versus a long-term leverage ratio of 1.6. This is called living well above your means on borrowed money. We have a long way down before we reach the bottom of this mountain of debt.

  • Despite the rhetoric out of Washington D.C. by the thieves and knaves about cutting deficits, the National Debt is on course to increase by $9 trillion in the next 10 years. It will reach $20 trillion by 2015.

 

Entitlements

  • The commitments made by politicians over decades in order to get elected have resulted in unfunded liabilities for Social Security and Medicare exceeding $100 trillion.

 

  • In 1980, just 11.7% of all personal income came from government transfer payments.  Today, 18.0% of all personal income comes from government transfer payments. Wages and salaries paid by private industries totals $5.5 trillion per year, while wages paid by government total $1.2 trillion and social welfare payments from the government total $2.3 trillion. Only ten years ago wages and salaries from private industries totaled $4.1 trillion, while government wages were only $800 billion and welfare payments totaled $1.1 trillion. In ten years the percentage increases paint the true picture: 
    • Private wages & salaries increased 34% 
    • Government wages & salaries increased 50% 
    • Government social welfare transfer payments increased 109% 
  • Despite the rhetoric from politicians, there is no lock box and there is no cash in the Social Security fund. John Mauldin summed it up nicely: “Social Security funds are an entry into a government accounting book that don’t really exist except as an IOU. Politicians of all stripes have used the Social Security money to pay for other government expenses. Those funds were even counted to offset the deficit, although now that Social Security is no longer in a surplus that has gone away.”
  • This year, about 3.3 million people are expected to apply for federal Social Security Disability benefits. That’s 700,000 more than in 2008 and 1 million more than a decade ago. Today, about 13.6 million people receive disability benefits through Social Security or Supplemental Security Income. Last year, Social Security detected $1.4 billion in overpayments to disability beneficiaries, mostly to people who got jobs and no longer qualified, according to a recent report by the Government Accountability Office, the investigative arm of Congress.

Employment

  • The official unemployment rate in the U.S. is 9.1% with 14 million people unemployed. The true unemployment rate, taking into account discouraged workers, part time workers who want a full time job, and people who have dropped out of the work force, is above 20%, or 31 million people.
  • It now takes the average unemployed worker in America about 40 weeks to find a new job.

  • Even after a supposed recovery, there are approximately 7 million less people employed today than there were in 2007.
  • The employment to population ratio of 58.2% is at the same level as 1969, before women entered the workforce in record numbers. As wages stagnated and inflation drove costs higher, families were forced to send two parents into the workforce, with predictable consequences to their latchkey children. The ratio peaked in 2001 at 64.4% and has declined precipitously since 2008.

civilian population ratio

Poverty

  • The number of people on food stamps has gone from 27 million people receiving $30 billion of aid in 2007 to 45 million people (14.5% of U.S. population) receiving $72 billion in aid today.

 food stamp participation

  • The number of uninsured Americans totals 49.9 million.
  • Those covered by employer-based insurance continued to decline in 2010, to about 55%, while those with government-provided coverage continued to increase, up slightly to 31%. Employer-based coverage was down from 65% in 2000.
  • One out of every six elderly Americans now lives below the federal poverty line.
  • Another 2.6 million people slipped into poverty in the United States last year and the number of Americans living below the official poverty line, 46.2 million people, was the highest number in the 52 years the Census Bureau has been publishing figures on it.
  • The percentage of Americans living below the poverty line last year, 15.1%, was the highest level since 1993. (The poverty line in 2010 for a family of four was $22,314)
  • Blacks experienced the highest poverty rate, at 27%, up from 25% in 2009, and Hispanics rose to 26% from 25%. For whites, 9.9% lived in poverty, up from 9.4% in 2009. Asians were unchanged at 12.1%.

Income

  • Median household income fell 2.3% to $49,445 last year and has dropped 7% from the peak of $53,252 reached in 1999.
  • Median household income for the bottom tenth of the income spectrum fell by 12% from a peak in 1999, while the top 90th percentile dropped by just 1.5%.
  • Between 1969 and 2009, the median wages earned by American men between the ages of 30 and 50 dropped by 27% after you account for inflation.
  • Median income fell across all working-age categories, but the sharpest drop was among young working Americans, ages 15 to 24, which experienced a decline of 9%.
  • When you adjust wages for inflation, middle class workers in the United States make less money today than they did back in 1971.

Wealth Inequality

  • The wealthiest 1% of all Americans now controls 43% of all the financial wealth in this country.
  • According to the Federal Reserve, the richest 1% of all Americans has a greater net worth than the bottom 90% combined.

 

  • The fact is that many people in the bottom half of the top 1% wealthiest Americans usually achieved their success after decades of education, hard work, saving and investing as a professional or small business person. A recent article by William Domhoff quotes an investment manager who works with very wealthy clients regarding the top 0.1%:

Unlike those in the lower half of the top 1%, those in the top half and, particularly, top 0.1%, can often borrow for almost nothing, keep profits and production overseas, hold personal assets in tax havens, ride out down markets and economies, and influence legislation in the U.S. They have access to the very best in accounting firms, tax and other attorneys, numerous consultants, private wealth managers, a network of other wealthy and powerful friends, lucrative business opportunities, and many other benefits. Membership in this elite group is likely to come from being involved in some aspect of the financial services or banking industry, real estate development involved with those industries, or government contracting.

  • Until 1980, the U.S. economic system was reasonably balanced, with manufacturing still the driving force in creating wealth for the middle class. In the three decades since, our political, banking and corporate elite have gutted our industrial base, shipped millions of jobs overseas and have used financial schemes and scams to suck the vast majority of middle class wealth into their grubby little hands. Wall Street has slowly and methodically pillaged the nation’s wealth, hollowing out a once vibrant nation, and their insatiable greed driven appetite drives them to want more. 

 

Consumer Debt

  • Total consumer debt in the United States at $2.45 trillion is now more than 8 times larger than it was just 30 years ago. The recent leveling off is completely due to hundreds of billions in write-offs by the Wall Street banks. The chart below is a Keynesian dream of government borrowing to create prosperity. The fallacy of Keynesianism is evident for all to see.

  • According to the Federal Reserve, between 2007 and 2009 household net worth in the United States fell by 25%, or $16.4 trillion.
  • The Federal Reserve says that median household debt in the United States has risen to $75,600.
  • Of U.S. households that have credit card debt, the average amount owed on credit cards is $15,800.
  • The top 10 credit card issuing banks control 80% of the credit card market, with Bank of America, Citicorp, JP Morgan Chase and Wells Fargo accounting for almost 60% of the market.

 

  • The average APR on credit card with a balance on it is 13.1%. These same banks are borrowing at 0% from the Federal Reserve.
  • Penalty fees from credit cards added up to over $21 billion in 2010.
  • There are 610 million credit cards held by U.S. consumers, with 3.5 credit cards per cardholder.
  • Americans now owe more than $887 billion on student loans, which is even more than they owe on credit cards.

Real Estate

  • U.S. home values have fallen an astounding $6.6 trillion since the peak of the real estate market.
  • National home prices have fallen 31% from their peak in 2005.
  • Approximately 11 million households, or 23% of all households with a mortgage, are underwater on their mortgage.
  • Household percent of equity is at 38.6% today, down from 60% in 2006. There are 87 million households in the U.S. Approximately 25 million of these houses have no mortgage, so the 52 million have significantly less than 38.6% equity.

 

  • Americans were so sure their houses would appreciate to infinity during boom years of 2005 through 2008 they withdrew over $3 trillion of equity from their homes and spent it like drunken sailors. The hangover will last for decades.

 

Savings & Retirement 

  • The S&P 500 Index reached 1,100 on March 24, 1998. The S&P 500 Index on October 4, 2011 is 1,100. Wall Street convinced millions of dupes that they needed to buy stocks for the long run. Thirteen years later, the average investor has nothing, while the shysters on Wall Street have reaped hundreds of billions in fees.
  • The stock market is priced to return 5% over the next decade, while bonds are priced to deliver no more than 2%.
  • 1 out of 3 Americans has no savings at all.
  • Workers estimate their retirement savings needs at $600,000 (median), but in comparison, less than one-third (30%) have currently saved more than $100,000 in all household retirement accounts.
  • The average 401k balance at the end of 2010 was $71,500. Aon Hewitt estimates that it will take retirement savings of 15 times your final salary to maintain your current lifestyle. Someone making $50,000 per year would need $750,000.
  • 50% of all the households in the U.S. (57 million households) have a total net worth less than $70,000. 
  • Robert Novy-Marx of the University of Chicago and Joshua D. Rauh of Northwestern’s Kellogg School of Management recently calculated the combined pension liability for all 50 U.S. states.  What they found was that the 50 states are collectively facing $5.17 trillion in pension obligations, but they only have $1.94 trillion set aside in state pension funds.
  • Every single day more than 10,000 Baby Boomers will reach the age of 65.  That is going to keep happening every single day for the next 19 years.
  • Approximately 3 out of 4 Americans start claiming Social Security benefits the moment they are eligible at age 62.  Most are doing this out of necessity.
  • 35% of Americans already over the age of 65 rely almost entirely on Social Security payments alone.

Foreign Trade

  • The U.S. trade deficit is now running at approximately $600 billion per year. It is clear that with the shift from a manufacturing based saving society in the 1960s and 1970s to a Wall Street finance based, debt driven consumption society from 1980 onward has led to massive trade deficits.

 

  • The gutting of the American middle class can again be traced back to 1980 when manufacturing employment peaked at 19.5 million. Once corporate CEOs embraced “globalization” in the late 1990s and realized they could reap obscene profits and compensation packages by utilizing slave labor in China to do American manufacturing jobs at 10% of the cost, the jobs disappeared. There are less than 12 million manufacturing jobs in the U.S. today, replaced by jobs at Wal-Mart and McDonalds.

 

  • The U.S. imports 9.5 million barrels per day of oil, more than 50% of our daily consumption. At an average price of $90 for 2011, we are sending $300 billion per year to countries that hate us and despise our way of life.

Energy

  • The U.S consumes 22% of the world’s oil output despite having only 4.5% of the world’s population.
  • The U.S. has less than 3% of the world’s proven oil reserves.
  • The Department of Energy was created in 1977 with the mission to reduce our dependence on foreign oil. The country has not built a new oil refinery or nuclear power plant since 1980.
  • In 1980 the U.S. imported 37% of our oil consumption. We now import 51% of our oil consumption.
  • In 1980 the price of a gallon was $0.58 per gallon ($1.90 adjusted for inflation). Today, the price of a gallon of gasoline is $3.40.
  • The DOE employs 16,000 workers & 100,000 contract workers, and operates on a mere $27 billion per year. Ironically, the DOE spends $300 million per year for energy in its 9,000 buildings around the country.
  • Despite being created to create a comprehensive energy policy, the DOE has no plan or strategy to address peak cheap oil. The impact on U.S. society from declining world oil supply will be devastating to the U.S. economy within the next five years.

Foreign Interventionism

  • America’s two wars of choice in the Middle East have cost $1.3 trillion in direct costs, thus far. The long-term costs will total over $3 trillion. 
  • The United States annual military spending is 8 times as large as China and Russia. We spend 73 times as much as the supposed dire threat of Iran. The U.S. accounts for over 44% of worldwide military spending.

 

  • In the year 2000, the U.S. spent $359 billion on Defense, including veterans and foreign aid ($17 billion). The 2011 expenditure is $965 billion, with $45 billion in foreign aid. Do the politicians in Washington D.C. recognize the irony of borrowing $45 billion from foreigners and then giving the $45 billion to other foreigners?
  • The U.S. operates 11 large carriers, all nuclear powered. In terms of size and striking power, no other country has even one comparable ship.  The displacement of the U.S. battle fleet – a proxy for overall fleet capabilities – exceeds, by one recent estimate, at least the next 13 navies combined, of which 11 are our allies or partners.
  • The U.S. military empire is vast. Officially, more than 190,000 troops and 115,000 civilian employees are massed in approximately 900 military facilities in 46 countries and territories (the unofficial figure is far greater). The US military owns or rents 795,000 acres of land, with 26,000 buildings and structures, valued at $146 billion.
  • With the collapse of the Soviet Union in the early 1990s, the military industrial complex needed to create a new enemy in order to keep the billions in profits flowing to the arms manufacturers. The War on Terror has been a windfall for the military industrial complex. The American people did not heed President Eisenhower’s warning.

Monetary Policy

  • The Federal Reserve was created in 1913 with the purpose of stabilizing the country’s financial system, eliminating financial panics, keeping prices steady, and insuring maximum employment. The result has been more instability, depressions, recessions, market crashes, unemployment as high as 25%, and inflation that has reduced the purchasing power of the U.S. dollar by 96% since 1913.

 

  • The Consumer Price Index was 10.0 in December 1913 when the Federal Reserve was created. Today, the index stands at 227. Prices have risen 2,270% in the almost 100 years since the Federal Reserve’s inception, or inversely the dollar can buy what it took $.04 to buy in 1913. Somehow, the banking syndicate that has “achieved” this result has convinced the public that inflation is good for them.
  • When Richard Nixon closed the gold window in 1971, the last check and balance on politicians and bankers was scrapped. The result has been predictable. The National Debt swelled from $400 billion in 1971 to $14.6 trillion today, a 3,650% increase in 40 years. The GDP grew from $1.13 trillion to $15.0 trillion today, a 1,332% increase in 40 years. Politicians have bought the votes of their constituents by making promises and financial commitments that have made debt slaves out of future unborn generations. Without a restraint on money printing, politicians will always choose to not worry about tomorrow.
  • The Federal Reserve policies of Alan Greenspan and Ben Bernanke were the single biggest cause of the 2008 financial catastrophe and their current policies have set the country up for the final cataclysmic disintegration of our economic system. By bailing out Wall Street every time they made a high risk bet and lost (1987 Crash, Latin America, S&L Crisis, Asian Crisis, LTCM, Dot Com, 9/11, Housing collapse, Lehman) the Federal Reserve has proven to be a tool for the super rich power elite. By keeping interest rates below where they would be in a free market, the Federal Reserve created the climate for gambling on Wall Street, the home price 3 standard deviation bubble, and the current screwing of senior citizens and savers to boost the profits of Wall Street bankers.
  • In August 2008 the Federal Reserve balance sheet consisted of $940 billion of mostly U.S. Treasury securities. Today, the Federal Reserve balance sheet totals $2.9 trillion and is filled with toxic mortgage debt shoveled from the insolvent Wall Street banks onto the plate of the American taxpayer. The Federal Reserve balance sheet is leveraged 55 to 1, meaning a 2% loss would wipe out their capital. Lehman Brothers and Bear Stearns were leveraged 30 to 1 when they went belly up.

 

  • During the recent financial crisis the Federal Reserve secretly loaned $16 trillion to the biggest banks in the world, including $4 trillion to foreign banks. This goes far beyond the mandate they were given by Congress in 1913. The Fed had no regulatory authority or ability to judge the credit worthiness of these foreign banks, but risked $4 trillion of U.S. taxpayer funds propping them up. With European banks on the verge of bankruptcy, the Federal Reserve risks losing even more money if they become the lender of last resort.

 

  • In the 3rd Quarter of 2008 American savers were able to generate $1.4 trillion of interest income on their savings. Much of this interest went to risk adverse senior citizens who depended on this income to make ends meet after two years of no increases in their Social Security payments. Three years later savers are only generating $1 trillion of interest income or 30% less, while their costs for food and energy have risen 5% to 10%. The Federal Reserve instituted a zero interest rate policy in order to enrich their Wall Street masters, while further impoverishing the middle class and senior citizen savers that are the true backbone of the nation. Ben Bernanke has purposely transferred $400 billion from the prudent to the profligate.

When I started to detail the issues facing our country today, I expected to come up with 10 to 20 bullet points of key concerns. As I methodically worked through the categories of challenges facing the American Empire, the total reached 76 bullet points. The facts as presented above paint a picture of impending doom for America. The slogans and vapid “solutions” proposed by political candidates and entrenched Washington politicians do not even scratch the surface of what would need to be done to save this country from economic collapse. Many of these problems took decades to create and are not solvable in a reasonable time frame. With the country still delusional, overleveraged, and underemployed, it seems like the existing economic and social structure will need to be blown up to restore hope in this country.

“A building is a symbol, as is the act of destroying it. Symbols are given power by people. A symbol, in and of itself is powerless, but with enough people behind it, blowing up a building can change the world.” – V in V for Vendetta

Look In the Mirror

After accepting the fact that the economic situation as presented above is beyond repair, two questions come to mind:

  1. How did we get in this predicament?
  2. How do we get out of this predicament?

The difficulty with trying to explain how we got here is that people want simple answers and a bad guy to blame. People want to blame the rich or blame the poor or blame the phantom ruling elite or blame the other political party. They prefer to blame someone else, rather than looking in the mirror. It took a century of bad decisions, delusional thinking, unparalleled hubris, greed, sloth and willful ignorance to place the country on the precipice of ruin. The American people are responsible for the situation they find themselves in today. We elected the politicians that passed the laws, created the agencies, borrowed the money, and spent the country into oblivion. The truth is human beings are flawed creatures. We are prone to greed, laziness, seeking power, worrying about what others think about us, delusional thinking, herd mentality, shallowness, and cognitive dissonance. All of these human weaknesses have contributed to our current dilemma.

Until the twentieth century the United States generally kept their nose out of foreign conflicts, only getting involved in small regional conflicts. The country experienced tremendous growth during the 1800s and early 1900s with virtually no inflation and no central bank. The country experienced this remarkable expansion with no personal or corporate income tax. The nation also benefitted tremendously from the discovery of oil in Titusville, PA in 1859, as oil fueled the industrial revolution in the U.S. The election of Woodrow Wilson in 1912 marked a dramatic turning point in U.S. history. Within one year the country had a personal income tax and a central bank. As with most things created by politicians, they seemed harmless at first. The tax rate for 99% of Americans was 1%. The central bank was given a limited mandate to keep our banking system stable. Within a century we have a 60,000 page Federal tax code and a myriad of taxes at the Federal, State and local level. The Federal Reserve has more power and control over our lives than any entity on earth.

Giving politicians the ability to tax its citizens and print money allowed them to do things and make commitments that would have been impossible prior to 1913. After being re-elected in 1916 on a platform of keeping the country out of World War I, Wilson committed the country to that war. By 1919 the tax rate was already at 4% for most Americans and the Federal Reserve was printing money to finance the war, generating inflation of 16% per year between 1917 and 1920. Thus began a century of foreign interventionism and debt financed social welfare programs. The Federal Reserve created the easy monetary conditions of the 1920s which brought about the boom and bust of the 1929 stock market collapse. This precipitated the Great Depression and the conditions that led to the rise of fascism and World War II. The tinkering by politicians with our monetary system created more problems, which politicians attempted to solve by passing new laws and creating new programs and agencies. Without an unlimited supply of taxes and money printed by the Federal Reserve, politicians would have been constrained.

The somewhat logical reaction to the Great Depression by Franklin Delano Roosevelt was to create make work programs, housing agencies and social welfare programs to keep the citizens from revolting. He did this through the creation of debt, doubling the National Debt from $22 billion in 1932 to $44 billion by 1940. This is when the entitlement mindset took root. The creation of OASDI (Old Age, Survivors, and Disability Insurance) in 1935 was not supposed to be a retirement plan. People didn’t retire in 1935. It was created to make sure widows and orphans did not starve to death during the Great Depression. Again, the rate was only 1% at the outset. The age at which you were eligible to receive assistance was 65, four years greater than the average life expectancy of 61 years old. It was created as an insurance program and has morphed into a glorified retirement plan that convinced millions of Americans they didn’t need to save for their own retirement. It is $17.5 trillion in the hole because life expectancy is now 79 years old, politicians expanded coverage and refused to level with the American public for fear of losing elections.

The psychology of entitlement has grown over the decades as politicians made promises with borrowed money. They created Social Security, Medicaid, and Medicare to provide pension and healthcare to all senior citizens. They created Fannie Mae, Freddie Mac and Section 8 housing because everyone deserved to own a home. They created unemployment compensation, SNAP, and SSDI to sustain the disabled and down on their luck.  Veterans are entitled to benefits as a result of their military service. These entitlements have become ingrained in our society. Charles Hugh Smith captured the essence of our entitlement mindset in a recent article:

“The entitlement mindset is thus firmly established in the American psyche. If we experience bad luck and/or the negative consequences of poor choices, we have been trained to expect the government at some level to alleviate our suffering, cut us a check or otherwise address our difficulties. The poisonous problem with the entitlement mindset is intrinsic to human nature: once we “deserve” something, then our minds fill with resentment and greed, and we focus obsessively on creating multiple rationalizations for why we deserve our fair share.”

The ability to tax and print trillions of dollars has enabled politicians to convince Americans they don’t need to save for their own retirement, they don’t need to worry about the cost of their healthcare, they don’t need to educate themselves, and they don’t need to help their neighbors because the government will do it for them. Once the entitlement mindset became ingrained in our society, self reliance, the ability to adapt to adverse circumstances, charitable acts, and taking responsibility for your own health and welfare rapidly declined among the populace. Government programs have been sold to the American people as acts of compassion for the less fortunate. Instead they have become a bureaucratic nightmare, creating dependence and a permanent underclass with no incentive, ability or desire to raise themselves up.

Human weakness and failings have also led to an over-class that have done far more damage to the country than those in society dependent on the state for their subsistence. The best description of this country at this point in history is a Warfare-Welfare-Corporatocracy. Since World War II the undue influence of the military industrial complex has led to almost constant conflict and foreign interventionism on a grand scale never matched in world history. President Eisenhower’s warning went unheeded:

“In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military industrial complex. The potential for the disastrous rise of misplaced power exists and will persist. We must never let the weight of this combination endanger our liberties or democratic processes. We should take nothing for granted. Only an alert and knowledgeable citizenry can compel the proper meshing of the huge industrial and military machinery of defense with our peaceful methods and goals, so that security and liberty may prosper together.”

The people of this country have traded liberty and freedom for the appearance of safety and security by allowing the corporate military establishment and their bought political cronies to use fear and phantom threats to convince the non-critical thinking masses to beg for protection. The Cold War was replaced by the War on Terror, while the truth is that we keep our troops in the Middle East to protect “our” oil under “their” sand. Attempting to maintain an empire through troops garrisoned in countries across the globe, patrolling the seas with our navies, buying the “friendship” of dictators, and saber rattling or invading countries we don’t like is a folly that has brought down many empires before ours.

The most decisive factor in the disastrous financial predicament we are experiencing today is the tsunami of Wall Street greed and avarice that was unleashed upon the nation starting in 1971 with Nixon closing the gold window and allowing the Federal Reserve to “manage” the currency with no hindrances like gold to keep them from going too far. Prior to the 1980’s Wall Street investment banks were partnerships. If a partner took an extreme risk he would endanger the personal assets of all the partners. This insured prudent lending practices. Once they became corporations the risk was passed to shareholders and as we’ve recently found out – taxpayers, while bank executives could reap obscene compensation by taking world shattering risks. The repeal of the Glass Steagall Act in 1999 and the obstruction in regulating the derivatives market by Alan Greenspan and Larry Summers created the playing field that allowed Wall Street go on a drunken rampage, pushing the worldwide financial system to the point of collapse in 2008.   

 What Happens Next?

 

“I felt like I could see everything that happened, and everything that is going to happen. It was like a perfect pattern, laid out in front of me. And I realized we’re all part of it, and all trapped by it. With so much chaos, someone will do something stupid. And when they do, things will turn nasty.” – Inspector Finch – V for Vendetta

Gains and Losses in 2007-2009, Average CEO Pay vs. Average Worker Pay

The chart above explains why anger and rage are beginning to bubble to the surface in cities across the country. It is clear there are no simple explanations or one answer to why the country is facing such calamitous circumstances. Essentially, human failings that have existed for all eternity have conspired to drain the vitality, risk taking, self reliance, personal responsibility and common sense from a once great nation. We know the uneducated, unmotivated lower classes, after decades of being kept down through our entitlement system, are unable and unwilling to do anything about their situation, as long as the entitlements keep flowing. It is the richest .01% that has accumulated the wealth, power and undue influence over the management of country. Either through inheritance, intelligence, connections, hard work, or luck, a few hundred thousand individuals out of 310 million people control the system. Immense wealth in the hands of the few has created a system where the few control the media, politicians, banking system, and mega-corporations that dominate our economy. Their human weaknesses include being egomaniacal power hungry materialistic greedy men who will stop at nothing to retain and increase their vast wealth. They have succeeded beyond their wildest dreams in pillaging the wealth of the middle class. But, they’ve gone too far.

They’ve manipulated the tax code in their favor. They make up most of the Senate, House and Judiciary. They own the mainstream media outlets. They are the masters of the universe on Wall Street. They run the mega-corporations that have shipped American jobs overseas. They pay millions to have the laws and regulations written for their benefit. They created the social welfare system, the public education system, and the healthcare system that keeps a vast swath of the population impoverished, ignorant and dependent upon the mutant organism that enriches the few. They’ve convinced the bulk of non-critical thinking Americans that the government can create jobs and make their lives safe and secure. This is the point where critical thinking Americans need to honestly answer a few questions to decide what happens next.  

Did Social Security make our retirements more secure? Did the Department of Education make our children smarter? Did the Department of Energy reduce our dependence on foreign oil? Would there be more or less than 160,000 structurally deficient bridges in the U.S. without the Department of Transportation? Does paying unemployment compensation for 99 weeks increase employment or create jobs? Did Medicare and Medicaid make people healthier and reduce healthcare costs? Has putting our faith in mega-corporations for health insurance, drugs and job creation benefitted middle class workers? Has the War on Terror made the average American safer? Did the War on Drugs reduce the usage and availability of illegal drugs? Did passing more laws lead to a more law abiding society? Does incarcerating more criminals in more prisons reduce crime? Does a 60,000 page IRS tax code result in more taxes being collected? Has issuing more debt to solve a debt induced crisis resulted in a stronger financial system? Does the Republican or Democratic parties have your best interests at heart? Does it matter who is elected President in 2012?

There are solutions to the issues facing our country but they all would result in painful choices, tremendous sacrifice, a willingness to rebalance our economy and lives, and the loss of vast stores of wealth by the top .01% richest Americans. The steps needed would be:

  • A nationalization of the Too Big To Fail banks with the required losses inflicted upon shareholders, bondholders and executives.
  • Re-institution of mark to market accounting rules requiring companies to truthfully report the losses on their loan portfolios.
  • The re-institution of Glass-Steagall to insure that no bank could become too big to fail.
  • Instituting a transparent regulated derivatives market that would insure that no single entity could threaten to crash the worldwide financial system.
  • Scrapping the existing individual personal income tax and replacing it with a flat, fair and/or consumption tax would take away the power of politicians.
  • The elimination of all corporate tax breaks so that multi-billion dollar conglomerates could not get away with paying no corporate taxes (GE).
  • The withdrawal of thousands of U.S. troops from across the globe and a dramatic decrease in military spending would be a voluntary reduction in our empire.
  • A renegotiation of the social contract with changes in eligibility based on age and financial means is the only way to retain a semblance of a social net to protect those who are truly needy. Otherwise the social welfare system will crash.
  • The population would need to accept a dramatic decrease in their standard of living as interest rates would need to be raised and saving would need to replace borrowing as our economic mantra.
  • Acceptance of the impact from peak oil would require a complete restructuring of our suburban sprawl existence with communities forced to become more locally self sufficient.
  • The political system would need to be overhauled with term limits and the elimination of corporate and special interest control over the election process.
  • The Federal Reserve would need to be constrained through the re-introduction of gold and/or a basket of hard currencies as a check on their ability to print money.

Sadly, we all know that none of these solutions would ever be willingly implemented by the existing ruling class. Anyone with an ounce of common sense can see the system is crumbling. The .01% went too far and stole too much. An unsustainable system will not be sustained. The debt load is too burdensome. The peasants are growing restless. Young people have occupied Wall Street. They are beginning to occupy other cities. 700 were arrested on the Brooklyn Bridge. Older people are joining the protests. There isn’t a cohesive message coming from the protestors other than the system is rigged in favor of the top .01%. Those who think they are in control are losing their grip. They see their power and wealth slipping away. They’ve had their way for decades and will not willingly submit to a change in the existing social order. Last night Jim Cramer voiced the concerns of the .01% by saying the Occupy Wall Street protests were worrisome. They are worrisome to the moneyed interests. They are a reason for hope to the 99.9%. We are approaching our moment of truth. There is something terribly wrong with this country. A new American Revolution has begun. It is time to stop being afraid and take this country back. What happens next? The choice is ours.

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….. – V’s speech to the British people in V for Vendetta

 

 

 

 

REVOLUTION COMING TO YOUR NEIGHBORHOOD

The coming gridlock after the 2010 elections will not solve our problems. This ain’t 1994. The linear thinkers have no clue. Farrell’s article fits perfectly with the Fourth Turning scenario that we have entered. Revolution and war are on the way. The linearists are trying to figure out what the Dow will be tomorrow or next week. They will be completely blindsided, as usual. I can picture the clueless look on Maria Bartiromo’s face when the shit hits the fan. She’ll lash out angrily against the masses. They will turn her Escalade over and burn it.

America on the brink of a Second Revolution

Commentary: 2010 elections guarantee gridlock, anti-capitalist class war

By Paul B. Farrell, MarketWatch

ARROYO GRANDE, Calif. (MarketWatch) — “What’s distinctive about the Tea Party is its anarchist streak — its antagonism toward any authority, its belligerent self-expression, and its lack of any coherent program or alternative to the policies it condemns,” warns Jacob Weisberg in Newsweek. But why not three cheers for the Tea Party Express?

Admit it, something historic is brewing. And yes, it’s good for America, even the anarchy. Revolution is renewal. Tea-baggers want to take on both parties, “restore honor” and “take back the country.” Bring it on, the feeling’s mutual.

OK, maybe most Americans just silently mimic the words, “we’re mad as hell, won’t take it any more.” But watch out: After November the campaign’s shrill rhetoric explodes into action.

Tea-baggers are kicking the revolution into high gear. Debt is sinking America. Both parties are to blame. So vote out incumbents. Spare no one. We need new leadership, another Reagan or Truman. Congress better get the message: Cut that budget, or they’ll dump the rest of you in the coming Great Purge of 2012.

Unfortunately they’re tone deaf. Congress cannot see past the election. All that changes in November.

So thanks Tea Party, Vegas odds must favor a Second American Revolution. Actually, the revolution is already roaring, hot, it’s about time. The GOP and the Dems had more than a decade. But America’s worse off. We need a real revolution to restore sanity … or we can kiss democracy and capitalism good-bye, permanently.

Warning: Another revolution will cost investors 20% more losses

Yes, big warning, the Second American Revolution will extract painful austerity, not the “happy days are here again” future touted by tea-baggers. For years it’ll be impossible for most of America’s 95 million investors to develop a successful investment or logical retirement strategy.

Why? Political chaos will translate into extreme volatility and a highly unpredictable stock market. Result: Wall Street will lose another 20% of the value of your retirement portfolio in the next decade, just as Wall Street did the last decade. So if you think you’re “mad as hell” now, “you ain’t seen nuthin’ yet!”

Here’s the timeline:

Stage 1: The Dems just put the nail in their coffin by confirming they are wimps, refusing to force the GOP to filibuster the Bush tax cuts for America’s richest.

Stage 2: The GOP takes over the House, expanding its war to destroy Obama with its new policy of “complete gridlock,” even “shutting down government.”

Stage 3: Obama goes lame-duck.

Stage 4: The GOP wins back the White House and Senate in 2012. Health care returns to insurers. Free market financial deregulation returns.

Stage 5: Under the new president, Wall Street’s insatiable greed triggers the catastrophic third meltdown of the 21st century Shiller predicted, with defaults on dollar-denominated debt.

Stage 6: The Second American Revolution explodes into a brutal full-scale class war rebelling against the out-of-touch, out-of-control greedy conspiracy-of-the-rich now running America.

Stage 7: Domestic class warfare is compounded by Pentagon’s prediction that by 2020 “an ancient pattern of desperate, all-out wars over food, water, and energy supplies would emerge” worldwide and “warfare is defining human life.”

What’s behind our 2010-2020 countdown? It became obvious after reading the brilliant but bleak “Decadence of Election 2010” report by Prof. Peter Morici, former chief economist at the International Trade Commission. He sees no hope from America’s political parties, just a dark scenario ahead.

Here are the 10 points we see in his message:

1. Expect nothing positive from Dems, the GOP or Tea Party

Yes, we’re all “justifiably ticked off.” But “Democrats, Republicans, and yes the Tea Party offer little that is encouraging.” Earlier Morici warned: “Democratic capitalism is in eclipse. … Politicians have deceived voters,” and are “suffering from delusions of grandeur, self deception and good old-fashioned abuse.”

2. Democracy has become too-big-to-govern … by anyone

“The current economic quagmire is a bipartisan creation.” Bush failures led to a “Great Recession … reckless Wall Street pay and fraud, a breakdown in sound lending standards by Fannie Mae, Freddie Mac … Countrywide, and a huge trade deficit with China and on oil” leaving “Beijing and Middle East royals with trillions of U.S. dollars that they invested foolishly” in bonds “financing the housing and commercial real estate bubbles.”

3. Clinton, Bush, Obama policies all feeding revolutionary flames

Even before Bush, “all was set in motion by bank deregulation engineered by Clinton … Secretaries Robert Rubin and Lawrence Summers … Clinton’s deal to admit China into the World Trade Organization” handed “China free access to U.S. markets” while blocking exports. Earlier Dems blocked “domestic oil and gas development” and froze “auto mileage standards.” Obama “finally imposed higher mileage requirements,” but after pushing offshore drilling, he “punished the entire petroleum industry” for the BP disaster.

4. Bush’s biggest mistake: Goldman CEO Hank Paulson

Morici admits: If Bush is “culpable for anything, it was to not see the gathering storm on Wall Street.” Worse, his Treasury picks were disasters: [John] Snow was clueless, Paulson devious. He conned a clueless Congress into bailout trillions, “believing banks could borrow at 3% and lend at 5 and pay MBAs three years out of school five-million-dollar bonuses to create mortgage backed securities.” Greed drove the Bush Treasury.

5. All partisan political leaders are destined to sabotage America

One thing is clear to Morici: Not only were America’s leaders a “bunch of second-rate incompetents” on both the Clinton and Bush teams, “Obama’s ratcheting up government spending and taxes won’t fix what’s broke, and neither will the GOP prescription of tax cuts and deregulation.” Get it? Democracy is in a classic double-bind, no-win scenario.

6. America’s democratic capitalism trapped in systemic failure

Morici simply dismisses “Obama’s two signature initiatives — health-care reform and financial services reregulation.” They “simply don’t work.” Why? Politicians “failed to address the root problem, Americans pay 50% more for doctors, hospitals and drugs, than subscribers to national health plans in Germany, France and other decadent socialist European countries.” Yet, insurers hate reform, will self-destruct America first.

7. Wall Street’s insatiable greed is a virus that never sleeps

Wall Street banks are “back to their old tricks,” warns Morici, “hustling municipal governments into the kind of quick-fix budget schemes, like selling parking meters and airport fees.” Why? Wall Street’s “hustling shoddy corporate bonds that lack adequate collateral and may never be repaid” to justify their absurd mega-bonuses. And they’ll keep doing it till the revolution creates a new non-capitalist banking system.

8. New political leaders offer no hope — Wall Street rules America

GOP’s next leaders will fail: “Cutting taxes and mindless deregulation are not the answer.” We need the revenue. They have no real plan to trim “$1 trillion from federal spending … few believe deregulation will fix health care or Wall Street.” The GOP has no “effective government solutions to health care, Wall Street, fixing trade with China, and dependence on foreign oil.” And the Tea Party “only offers a purer form of failed Republicanism. Tax and spend less, and turn the country over to the robber barons.”

9. Praying for a messiah, we’re sleepwalking till the revolution

Morici’s solution: America “needs a prophet, another Harry Truman or Ronald Reagan.” But we’ll never get one, until a catastrophe hits. Wall Street’s so greedy, so corrupt, so untouchable, so much in control, they will bankroll and control all future “prophets.”

10. The Second American Revolution coming

Yes, extreme austerity: “Americans must accept fewer government-paid benefits — for the rich, the poor and those in between — and must acknowledge the market works best most of the time, but it is not working in health care, banking, China, and oil.” Huh? Sounds like classic economist’s double-speak: “The market works most of the time” … except the market doesn’t work at all in the four biggest economic sectors? Fuzzy thinking?

Morici warns, we need “new approaches to regulating, yes regulating, what the medical industry charges, bankers pay themselves, what Americans tolerate and buy” and “guiding big oil and car companies to sustainable solutions.”

Holy cow, he suddenly sounds more like a liberal politician than conservative economist. Yes, he’s reflecting the total chaos coming on the short road to the Second American Revolution.

In the end, however, you have to admit the good professor does make a lot of sense: “Sounds radical but running the world has never been a choice between statism and anarchy,” says Morici.

Choice? Unfortunately, he offers a false choice: Running America effectively means accepting “that the private sector is not the enemy and government is not evil, but neither can serve the other, and us, if value is not seen in each.”

Laudable, but impossible because once the GOP Tea Party of No-No is back in power, compromising is not on their agenda, “gridlock” is. So anarchy is the only choice — they will never, never work with Democrats … until forced by the Second America Revolution when the middle class finally rises up and overthrows the greedy wealth conspiracy of Wall Street, Washington, CEOs and the Forbes 400.

Till then, anarchy rules as the conspiracy keeps looting Treasury, stealing from taxpayers, conning us all.