Monday, March 25, 2013

The Crisis of the Month Club


OK, let's see, I think I've got this right – first there was the “fiscal cliff”, and then the “sequester”, and now we have the “continuing resolution”, to be followed by still another “debt ceiling” crisis. And before the current endless stream of crises, there was the default crisis, and the reduced bond rating crisis... not to mention the budget fights that seem to occur every few weeks, even though, supposedly, budgets are passed on an annual basis.

So what's it all about? Just sheer stupidity and bull-headedness on the part of the administration and Congress? But that's been the case as long as anyone can remember; why is it now taking the form of a monthly (at least) crisis of some sort? Politics? But that's been around forever too. OK then, how about a change in tactics? Like this “fiscal cliff” which supposedly held the defense (AKA war) budget hostage – except that it really didn't – and the sequester, which supposedly involves “draconian” cuts in the defense budget (if only!)... except that it doesn't. If you study the numbers, you quickly realize that there are no “cuts” at all – the only thing even remotely reduced is the rate of increase in the defense budget (and all others as well) – i.e. the percentage by which they go up each year. The so-called “cuts” are not even enough to yield a straight-line budget, to say nothing of a real budget reduction. What it basically means is that every government department and agency will continue to have what it has now; the only thing in question is the amount of additional goodies they'll be awarded. But of course “what you have now” is never enough, any more than it is for an ambitious or greedy individual citizen. Everyone wants to be bigger, better, stronger – the difference being that the government gets that way by making the citizenry smaller, worse off, and weaker. The tumor has now grown to be bigger than the host – a situation that cannot stand if you're talking about biology, and is unsustainable in economics as well, even though the people who voted for Obama all believe that government is the (only) source of wealth and prosperity. If “war is the life of the state”, then it's also the death of the overall economy, and of individual freedom and prosperity. We have seen collectivization reach the breaking point in a number of societies over the past few decades; we know it's unsustainable. The only question is what happens after it collapses of its own weight, and every society seems to have its own answer. The Russians sold everything off to speculators, the Chinese morphed into state capitalism, Cambodia... well, what did Cambodia do? Does the place even still exist?

But even that is giving the powers-that-be too much credit – i.e., for having good, if flawed, intentions. The fact is that the “fiscal cliff” was a hoax. It was a self-inflicted wound that, once the supposed day of reckoning had passed, was quickly forgotten. But the point had been made – Congress and the administration are helpless in the face of blind forces, and they need the unflagging support of the public in order to rescue us from disaster. (Notice how everyone forgot that the “fiscal cliff” was the result of legislation passed by, guess who, Congress, just a few months earlier?) And then the “sequester” -- again, blind, evil forces taking drastic cuts in those very areas that would hurt, or at least annoy, the public the most – except who decided on what those areas were? Men from Mars? Oh, right – it was what we used to call “salami slicing”, where everyone pays their “fair share”. So putting condoms on bananas in public schools gets cut just as much, but no more, than air traffic control. Big Bird takes a hit, but no more of one than artificial limbs for war veterans. But again, someone had to decide this – they had to set up this straw man to, first, scare everyone, and then knock it down, to great relief and rejoicing.

What has changed, more than anything else, is that the public is being dragged into each of these made-up crises, and forced to sit there like people in the front row at a boxing match, getting splashed with blood and sweat... even if they'd rather be just about anywhere else. And what they are mostly forced to do is rise up out of their apathy and worry, fret, and panic. The world is coming to an end (again!), and nothing can save us except – you guessed it – the government. Ah yes, our persecutor and tormentor, and the cause of all of this trouble, and yet they can still save – and will, provided we give undying “support” (usually involving giving up more freedoms and wealth), don't ask questions, and turn our fates over to our betters.

It resembles nothing so much as an old-time protection racket, in which the same mob would either protect you or put you out of business, depending on whether you “cooperated”. This was the kind of thing practiced in places like Chicago, for example, which has the distinction of being the most recent home town of Our President. (Coincidence? I don't think so.)

But I'm going to take this one step further. It's one thing to refer to Obama as a thug, demagogue, and con artist, which he is – but he and his cronies, and Congress, are terrorists as well. How so? Well, what do terrorists do? They cause stress among the populace through random, violent attacks, and then offer to stop if only people will start doing things their way – adhere to Sharia law in the case of the Islamic world, or love Big Brother – i.e., embrace the totalitarian state – in our case. Now, granted, this domestic terrorism is not directly physical (although I'm sure it's caused some heart attacks here and there), but a daily assault on your peace of mind, sense of well-being, security, hope for the future, confidence, morale, and wallet? That adds up to a pretty hefty non-physical cornucopia of offenses. And sure enough, the media are playing their assigned role very effectively – pushing the panic button every hour on the hour, 24-7. And by this I include not only the “mainstream media”, but also the “acceptable opposition”, like Fox News and talk radio. They're all on the same side – the side of panic, terror, and despair. And to all of this you have to add cynicism, as evidenced by the fact that, as each crisis passes without the world actually coming to an end, Obama gets up and jokes about it, like it was really not that big a deal after all. Well, which is it, sir? One minute the very American way of life is at stake, and the next minute we're going to make a few “tweaks” and minor adjustments, and all will be well. (And, by the way, he sits down to dinner with the “opposition” and they have a great evening joking about it all.) 

Do you see the cyclic nature of all this? The current version is as follows: (1) Made-up crisis, for which no one is responsible. (2) Said crisis constitutes an existential threat to the health, safety, well-being, and way of life of every American. (3) Only the government can save us, except that it is being kept from doing so by (a) Republicans, and/or (b) conservatives, and/or (c) an obstreperous public which hasn't yet learned its lesson. (4) As the eleventh hour approaches, tensions mount, and the media are on high alert. There is a run on banks, people are buying gold, guns, and freeze-dried food (as well as the 3 staples -- milk, bread, and gasoline). (5) Finally the moment arrives when a great chasm was to open up and swallow the country whole, but (6) A miracle! Somebody blinked, or there was a last-minute compromise, and the crisis was averted (until next time). The president gets all the credit for saving the day, and the Republicans and shown, once again, to be greedy, selfish, and evil.

Rinse and repeat!

The amazing thing is not so much that this same scenario gets played over and over again – typically engineered by the Democrats but with the full cooperation of the Republicans – but that people keep falling for it. I guess it's better than simply living a life of quiet desperation. A bit of excitement now and then, to make up for the cradle-to-grave state of twilight sleep we exist in most of the time. Maybe it's even a good thing, in a way – serves to thin the herd or something, like swine flu. It is, in a sense, the domestic equivalent of “terrorism” and the “war on terror” -- endless, random, without cause, but the gravest threat in our history, and requiring significant sacrifices of wealth and rights. But the point is that it's a hoax – it's always a hoax, things are never even remotely out of control, and it's all about expanding government power and contracting individual liberties. The goal, of course, is a totalitarian state with a ruling elite and a vast army of slaves – with a “missing middle”, namely the middle class, which has been marked for extermination.

(And as a side note, this outmoded idea that the American middle class and small business are the true sources of the nation's wealth -- well, that premise has clearly been thrown over.  The working classes and socialists never believed it to begin with, and the ruling class has now apparently decided that they can get along without the middle class -- that computers and automation will fill the gap, somehow.  So you can have a society made up of a lower class, most of whom are unemployed, a bunch of robots and computers in the middle, and a ruling elite at the top.  Right out of sci-fi.  But you know how most of those stories end... )

And speaking of... well, this isn't the best segue ever, but I'm going to throw it in. Anyone notice how the Dow is back at record highs? With everything else going terribly wrong with the economy, the Dow is sitting there on a high place, basking in the sun. How can this be? How, for example, can it be that the re-election of a socialist president hasn't been a severe blow to the stock market and to the financial sector in general? Time was – and I can remember – when you could count on the stock market to take a plunge whenever a Democrat was elected (or re-elected) to the presidency, and get a boost whenever a Republican was. And this was simply because the Republicans were on the side of business, and of capitalism, and the Democrats were on the side of labor, and of socialism. Very simple. But these days, those reliable old correlations don't seem to be in effect any longer.

Well, to make a very long story very short, it's because the Democrats have long since given up populist-style socialism (exemplified by the New Deal) and become, for all intents and purposes, fascists – leaving the genuine populism to people out on the street, like the Occupiers. And the Republicans have given up free-market capitalism (of the “old guard” type, or of the paleocon type, or of the libertarian type, or of any other type) and become... fascists. And the people at the top of the financial food chain – large international corporations, banks, and other financial entities, have decided that the political system that best serves their interests in the long run is... fascism. Wow, talk about a meeting of the minds! Finally, everyone agrees on something. But what it means is that elections no longer matter (assuming they ever did) because anyone who is elected (or allowed to be) is going to have the same core agenda, even if their rhetoric seems to indicate otherwise. Which means that the ruling class, or Regime, will prosper no matter what, the lower classes will continue to be hypnotized by games and circuses (and controlled substances), and the middle class (including the few remaining genuine capitalists, i.e. small businessmen) will continue to be led, like sheep, to the slaughter.

But then why should the Dow, or any other economic indicator, go up or down at all? If the sun is always shining on the heights upon which the ruling class dwells, why this constant fluctuation (dutifully described by the media, in their typical hyperbolic way, as “soaring” and “plunging”)? Well, that's because the stock market too is a hoax – what I call a gigantic churn, taking in the hard-earned savings of the unwary and spitting out losses, while those in charge receive a no-risk, guaranteed income. It's a mechanism, OK? -- a mechanism for parting fools from their money. Now, this is not to say that ordinary people can't occasionally make money in investments, but the system was not designed with them in mind. That would be like turning a polo field over to Frisbee players.  No, it was designed as a place for those in charge to stash money, and use it as a kind of bait to get others to “invest”. I put that in quotes because, in fact, to the average investor, buying securities of any sort is not an investment at all, because that implies some modicum of knowledge about what is being invested in, and of the dynamics involved. It's, rather, a gamble, pure and simple. Whereas for those running the show, it's neither an investment nor a gamble, but a sure thing. So in the long run, wealth will tend to “trickle up” from the na├»ve middle class to the ruling class, and the stock market is one of the main mechanisms by which this occurs – along with things like inflation, taxes, interest (low on savings, high on credit), cost of living (the part that's manipulated, which means most of it), health care, insurance, real estate, etc.

So the stock market goes through cycles too. It has to, because how else are you going to seduce people into gambling there? It's the element of chance – of luck, of unearned wealth – that seduces people, the same way gambling does. The so-called Great Recession, which I call the Great Taking, was the most recent instance of manipulation of the middle class to achieve maximum financial “exposure”. The boom was lowered, and all of that “wealth” (mostly on paper anyway) vanished, and only the international banking/financial cartel knows where it all went. So then the ordinary schmo gets scared, starts hoarding his pitiful stash of cash, and the elite go around and police up the battlefield, picking up assets at bargain prices (and selling them to the government at retail, in the case of real estate). Time passes, and memories grow dim – and then it's time for another Great Taking. I think this is what the current highs in the Dow are all about, more than anything else. Because by any other criterion, it's totally unreasonable; it shouldn't be happening. With a government that is, for all intents and purposes, bankrupt... that is borrowing money up to the level of the GDP each year... that is squandering resources on endless, pointless wars... that is socializing as much of the economy as possible... that is openly persecuting and robbing the middle class... you'd think that the second-to-none economic indicator would reflect all of this. “Except” for what I described above – that's it not an indicator of the overall health of the economy, or of its probable future economic health, or of anything else – it's just that magic moment when the slot machines at the casino seem to be “paying off” and all the knuckle-draggers in town race over to stuff every last dollar they have into those slots, only to be grievously disappointed.

And I guess the saddest thing about the Great Taking is that no one was punished who should have been, and no one learned anything. The stage was immediately set for the next round, and it may now have begun.