Sunday, February 1, 2009

The center cannot hold

Most people with whom I discuss secession think the idea is flaky. We fought the War Between the States almost 150 years ago, the North won, and that settles it. Fair enough, for a time when the people had confidence that their Federal government would take into account the interests of all of the people, not just some of them; in a manner consistent with our Constitution and our heritage.

Hardly anyone thinks that way anymore. President Obama and the Congress have been working on an “economic stimulus” package to throw another trillion or so at the problem; about one-third of which is nothing but old-fashioned pork, and the rest of it of unknown validity for addressing the problems we are facing. We are told that if we rely on tax cuts, people will just save the money. While saving helps us as individuals, our failure to spend, we are told, will hurt the economy. This is not true. Even if we all do save any tax breaks or just use them to repay our mortgages, it may slow recovery a bit, but will produce better results on the long run. Savings now will increase the supply of money that banks can use to lend to corporations to build new plants, create new technologies, and enhance their competitiveness. Smaller loans can help entrepreneurs get into business. This is not just some wild-eyed dreaming – it is basic economics – assuming that the banks are operating rationally in their own interest. And just as importantly, it gives us the freedom to manage our own money as we see fit.

The problem is, tax cuts will not ensure that the money will flow to the governmental and corporate interests that have bought out the Congress, and perhaps the Presidency as well. Congress has not asked for, let alone received, an accounting for the first $800 billion. Banks that received the first round of TARP* funds are rebuffing efforts to determine how it was spent.

The system is broken beyond repair. We have centralized our financial system to a point that all of our banks and brokers are dependent upon what goes on in New York and foreign financial centers. We have centralized our government to a point where it is inconceivable that any agency other than the Federal Government can solve a problem; despite 200 years of American experience to the contrary.

The choice in our elections is like one between strawberry and lemon-lime Kool-Aid. If both flavors are laced with cyanide, what difference does it make?

I am uncomfortable with the idea of class warfare – to me it reeks of Communism; but the truth is, we are seeing a war waged against the middle class. Government has bought out the poor, and is funneling money to the rich through defense contracts, bank bailouts, and, too often, favorable regulation. But how is government financed?

By taxes. And who pays those taxes? We do. Our work, our productivity is being sacrificed to support a corrupt system. So why is it still holding? So far, the taxpayers have been in denial. We are so engrossed with our private lives (or with television), that we cannot see the bigger picture.

We either cannot, or do not want to see that Peak Oil will put an end to the cheap transportation of goods over long distances. It will increase the cost and decrease the availability of electricity. It will force us to change the way we do everything, from farming to manufacturing to government. We will soon discover the long-hidden truth that all economics is local. We will have to buy food from the local farmer (or grow our own) to survive. We will have to buy from the corner grocer or local haberdashery to survive. The glut of Chinese goods will end, because it will become too costly to send them here.

In the meantime, we are printing trillions of dollars as casually as we only recently printed billions of them. One day, our economy will be flooded with dollars, and hyperinflation will set in. Heaven help the unprepared on that day! We speak now of burdening our children and grandchildren with debt. That will not happen, because at some point the debt will be repudiated; but we will be saddling them with generations of much harder work than we are used to. Making things, growing things, building things, just as our great-grandparents used to do. Social Security, Medicare, and social welfare programs will be memories of the past. The sudden end of these programs will cause suffering for millions of people.

The poor people won’t be hurt at first – they’re on the dole. The rich people won’t be hurt, either. Those that aren’t on the dole have the resources to weather the storm. The middle class (the center of our society) will be devastated. When the middle class collapses, so does the nation. If our Federal policy of throwing trillions of dollars in “bailout” money is not soon reversed, our nation will collapse. My guess is that collapse will occur within the next four years.

When the nation collapses, we will have three choices:
- We can decide that we need control, and accept a totalitarian dictatorship or a world government (which may have the same effect);
- We can allow ourselves to descend into chaos, like Somalia and Afghanistan; or
- We can prepare ourselves, as individuals and as State and local governments, for the inevitable, and apply the “Right of the People to alter or abolish it [the Federal Government] and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to [us] shall seem most likely to effect [our] Safety and Happiness.” **

I am a secessionist because the third option makes the most sense to me. It is the only one that will continue our historic freedoms under the rule of law. I hope and pray that this is the option that makes the most sense to you.

* Troubled Assets Relief Program
** Declaration of Independence.

1 comment:

Anonymous said...

Nice job, Harold. Your sincerity, coupled with your anguish, leaps off the monitor.

Re hyperinflation, the Bank for International Settlements estimates the derivatives swap death-star that is hovering out there somewhere to be about $596 trillion. There’s not enough money in the world to cover it. Ergo there’s not enough labour, i.e. potential value, and there certainly isn’t enough energy to re-boot. Shades of pushing a wheelbarrow down to the local store for a loaf of bread (if there is any) in order for the banksters to squeeze down the value of the debt. The current round in Davos is sending some interesting signals. They really aren't all that disturbing, at least they aren't for those who know what lurks on the horizon.

According to the Chinese proberb: "May you live in interesting times." Well, here they spades!