Home > Uncategorized > Skye’s Shapes of Things to Come

Skye’s Shapes of Things to Come

Dagny wrote:

Any time a cult of personality couples with financial incentives, there is a risk of a cult getting dangerous.

In the case of the government, this happens all the time. People don’t want to believe that the leader’s dream is over for both social, emotional, and financial reasons. The force to keep on going in the cult are huge.

Sometimes a cult dies because the money runs out. The lies become apparent as the financial incentives to keep the cult going drop.

Facts are stubborn things. They become apparent when the money to keep them quiet and hidden disappear. This seems to apply from the scale of families, all the way to the world financial and political structures.

We should do what we can to wake people up, but reality is far more eloquent than we can ever be.

Skye wrote:

Dagny, I’m afraid that you are right; America probably won’t wake up until the OPM (Other Peoples’ Money) suddenly runs out, quite possibly with the dollar blowing up and all the drastic consequences (how do we then import oil?) thereof.

Although we don’t know yet which candidate will win the Republican nomination or whether that candidate will replace BO, we already know enough to foresee some near future consequences that will occur whoever wins.

Only Ron Paul understands our fundamental economic problem, and he almost certainly can’t be nominated because a substantial number of conservatives firmly believe that he is anti-defense and even anti-
American (in spite of his raising more money from members of the USAF, US Army, US Navy, and US Marines than the other candidates). Paul’s proposed trillion dollar deficit and spending cut in his first year and elimination of five cabinet departments is the only proposal that isn’t tokenism.

The other candidates have token responses to the deficit (Perry’s promise to cut it by 6% in his first year being the best of the remaining bunch) and belief in magical solutions (Cain’s 9-9-9, Perry’s executive orders and 20% flat tax, Romney’s 59 points, Newt’s big government best management practices and investment for the future blather).

Whether BO wins another term or one of the plausible Republicans wins, the five most important existentially threatening problems and their outcomes will be the same:

1) Interest rates will continue to be held artificially low by the Fed thereby causing trillions of dollars of capital to be misallocated by both private and public actors, including into further government deficit spending, and

2) The many trillions of dollars of capital that have already been misallocated will remain misallocated because the entities controlling that capital (e.g., Fanny Mae, Freddy Mac, FHA, Bank Of America, JP Morgan Chase, Goldman Sachs, AIG, Government Motors, etc.) will continue to be bailed out and not be liquidated, resulting in a Japanese-like no-growth zombie economy with zombie government supported banks and zombie government supported big businesses, and

3) The deficit and spending cans will be kicked farther down the road because that is the route of least political resistance – until the US Treasury Bond bubble bursts and the dollar blows up – which may or may not happen during the next four years but is very unlikely to be farther than a dozen years in our future. When the dollar blows up, it will cease to be the international reserve currency and world trade will crash until something replaces it, and

4) The US and Japan will remain the only industrialized countries in the world which require most business capital investments to be depreciated over up to 39 years rather than allowing them to be expensed (simply deducted from taxable income), resulting in capital moving to greener pastures where expensing is allowed, so forget about a resurgence of either American manufacturing or another American high tech revolution, and

5) The populations of America, Japan, China, and non-immigrant Europe will continue to age rapidly so that the ratio of retirees to workers will continue to increase. The first four problems are potentially soluble by political means (though that won’t happen with the current contenders), but this fifth one is for keeps. That does not mean that substantial amelioration of this problem by political means is impossible; the Medicare cost problem could be greatly ameliorated by getting government out of medicine and health care, but only Dr. Ron Paul proposes eliminating both the FDA and medical licensing, so that isn’t going to happen, either.

Please note that I did NOT say that it makes no difference as to who is elected. There will be differences, but not in these five overarching existential threat problems.

Can your family and your income survive a period of little oil imports? Can you defend your family against hordes of hungry looters, and what will the local government do to you if you have to do so? Do you have a personal relationship with a good physician who will help keep your family healthy for untraceable payments under the table? Do you have anything with which to make such payments? These terrible problems don’t have to happen, but are rapidly becoming inevitable if the politicians keep kicking the can down the road.

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Categories: Uncategorized
  1. November 20, 2011 at 3:39 pm

    Two of the sharpest minds I know.

    Thank you both.

    Ron Paul may have the deepest understanding of the economic woes facing our country, but he’s every bit as unelectable as all of the other ‘Pubs for their respective and various handicaps.

    I’ve resigned myself to four more years of BHO. I’ve also resigned myself to the fact that the man or woman in the White House is relatively meaningless as long as there is still so much systemic corruption, inefficiency, and graft in Congress. A systemic reset would be helpful, but that, too, is a pipe dream.

    The size and scope of our federal government cannot ever get smaller. The notion of limited government is a great theory, but it is an ideal that can no longer ever be realized.

    No organism or organization exists with the express intent to obsolesce itself.

    For those of us who value individual liberty and limited government, our only hope is to build local and state governments who share the same ideals that we do, AND to take individual steps to extricate ourselves from the federal matrix.

    -Mitch Rapp

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