Summer 2010

Mirror, Mirror

Marc Solomon

There is a saying among economists to the effect of, "that which cannot go on forever will not go on forever." Those of us who believe that reality exists are trying to predict when things will begin ending. The events of 2010 seem like a starting point.  Last year, I thought that the rest of the world would be looking at us as an example of what not to do. The recent events in Greece, and the subsequent decision by the EU to bail her out, convinces me that Europe isn't paying very close attention. The European Union may end even before we face our own strange future. 

The German economic powerhouse has carried the EU, but now how many more of the marginally productive states of Europe can be bailed out? Ireland, Spain and Portugal may soon be in the soup. The former Eastern Bloc states have no significant manufacturing capability to sustain themselves. What happens when Germany gets tired of shouldering the burden of the economic excesses, the failed socialist utopias, of the rest of Europe? Germany can walk. It is the parable of the difference between those who produce and those who only consume. When the producers grow weary of the consumers, then they can just leave. What makes this so tangible is that the age of the new-world-order-styled EU, in comparison to the 1000 year history of Europe, barely registers. Europe has always been clannish. It has always quarreled and fought wars. There is no European social consciousness. The Union wasn’t approved by the masses, but the globalist elite prevailed.

Yet there is nothing more unifying or polarizing than economic stress. If Germany leaves, they can still trade with the rest of the world. They have heavy industry and products of quality that are still highly desired.  Germany can trade for oil or food. But if they leave the Union, the Union will fall. It would be very simple for Germany to reestablish the Deutsch Mark and go about their business. France could do the same. The other states would not fare so well. The Eastern Bloc, still reeling from the socialist experiment of the 20th century, are second-class citizens, and have nothing to offer the world, save tourism and specialty meats.

We should look to Europe as the last warning we get before we too break into pieces. We are constantly sold the belief America will always be here. Myth.  The rest of the world is well acquainted with the fall of empire.  We are not, and we are naïve.

With the fall of the Soviet Union, socialism should have been universally acknowledged as a failure. So although the great threat of communist military aggression died, the root of its destruction strangely enough did not. With the notable exceptions of Germany and France, Europe increasingly took on the mantle of socialism. France and Germany maintained manufacturing capacity, unlike the US. Those nations remain creditors, unlike the US. They produced more than they borrowed. If the unproductive socialist states begin drowning in unrest, rattled by enraged labor unions and government workers demanding their usual free ride, will we learn anything? Will we not see what will happen to us, after all of our manufacturing jobs are gone, after “free” health care destroys the medical industry, and the ultimate economic and spiritual drain of the deaths of more soldiers fighting pointless wars against invisible enemies?

Those of us who study Austrian economics — that is, reality — cannot believe the blind brinksmanship that our politicians and the bankers play with our future. Their psychotic lust for votes and power is Caligula-class. When will we see riots in the streets? State workers demanding their lavish retirements? Police striking? Look at Greece. Better yet, look at Arizona.  It is not the AFL-CIO protesting (yet), but people who have no official status demanding handouts. Yet the corrupt media is appalled. Racism! Bullshit.

Will we be surprised if history unfolds before us? Will we even notice? Will we hold up a mirror and see the same heading our way? I do not relish the thought of our nation falling apart, but can we continue to turn a blind eye to the reality of the suicidal federal and state economic policies, like California’s, a freefall of spending that makes paupers of us all. We poorly educated Americans continue to fall for the fraud of the Federal Reserve, that lends fake money to us at exorbitant interest — and we actually believe we have to pay it back.

The reality is that the capital to produce food, energy, textiles, transportation, and housing is real and finite. While the Far East is entering their golden age of capitalism, we are borrowing against our past. We still grow food but we continue to import. We make cars no one wants (even us). We don't make building materials or high technology items either. Look at the labels on the clothes you are wearing, they weren't made here either.  Oil?

Our biggest commodity is export is garbage. Really.

Why should we get to drive cars, live in houses, wear clothes, use energy, have electronic gadgetry if we produce nothing in return? What do we make that the world actually wants? Entertainment? Our entertainment: celebrating the great myths of the American dream, individualism, romance, integrity and freedom.
As the government schools have destroyed our critical thinking skills, just like in 1984 we now lack the words to say: let us be free. Let us use our own energy in our own industry and our own factories and our own farms and our own workmanship to make what we need.  Free our communities to take care of themselves. Free each family to take care of their generations, to focus on production versus consumption. Let us have savings and investment and risk versus the teenage spending habits of politicians.

It would be truly magical if America's last great contribution to this world, the Internet, be the savior of our nation, by virtue of its ability to strip from the media whores, crony capitalists, globalist elitists and the politicians the ability to communicate, spread facts and teach each other about our economy, our laws, and our world. This last great industrial invention of ours, which brings the entire world to us and us to them — and you to these words — could be the undoing of the bankers and politicians. I hope we are in time.