A Permanent Ruin
‘The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists.’
And now we have both, inflation and war!
Any dope could see that when you lend money at below the going rate of inflation…stymie output with regulations, shutdowns, tariffs, and waste trillions of dollars…and try to make up for lost production with printing press money — you are asking for trouble. We said so (ad nauseam) in these pages.
The Fed doesn’t have many responsibilities. Controlling inflation is right up there at numero uno. Yet, not only did it fail to see the inflation it was causing…and then misdiagnose it as ‘transitory’…now, it has no idea of how to get the cat back in the bag.
Baby steps of 25 basis points — from here to eternity — will never do it. The Fed will be following inflation, not leading it.
But let’s return to our subject from the other day. The question is not what, but who is really behind the US inflation, COVID Panic, and now hysteria over the war between Russia and its former satellite?
A who’s who of war
In modern warfare, as we saw last week, the generals get their medals and sinecures. Raytheon shareholders get higher stock prices. The empire’s whole military/industrial/surveillance/think tank/university/press complex becomes richer and more powerful. So it is hardly surprising that this huge complex — about which Dwight Eisenhower warned us 60 years ago and which has only gotten richer and more powerful since — would want to get the country steamed up for war.
But while the military/industrial/etc. complex is extensive…it’s not the whole ‘who’ that is behind the obsession with the Russia-Ukraine conflict. Who else? Here’s Foreign Affairs with a hint: ‘Is Putin’s War Fortifying the Democratic Alliance’.
Yes, dear reader…there’s more to this complex…and it’s not just in the US.
Let’s begin with the natty question: Isn’t a strong, healthy US enough? Wouldn’t our leaders do well to focus on that goal rather than obsess over who misgoverns a country on the other side of the world?
Practically every day brings new threats of ‘an attack on democracy’. The 6 January riot at the Capitol…Trump’s ‘stolen election’ claims…attempts to control who votes (or how often) — and now the Russian assault on Ukraine.
But what is it that makes a democracy…or a global ‘Democratic Alliance’…so superior…so desirable?
Of course, we ‘democratic’ countries don’t invade smaller countries, do we? Well…never mind that one…
But at least we don’t have a few rich people…and a lot of poor ones. Uh…maybe that doesn’t apply either.
How about free speech? We can say what we want in the US — without fear of repercussions, right? But say the ‘wrong’ thing, and your career is over.
Hmm…at least we don’t try to put truth-tellers in prison, do we? But what about Ed Snowden and Julian Assange?
The bottom line is this, isn’t it: in our countries are democracies ‘the people’ decide the important issues, not the ruling elite?
Oops again. In the US, the president changes…the ruling party changes…but the ‘deep state’ rulers — the deciders, the influencers, the manipulators — remain the same. So do the key policies. From Bush to Obama to Trump to Biden there was a big ‘cultural’ shakeup each time…(a brouhaha led by the press)…but no real change of direction. The rich got richer. Spending increased. Debt rose. No agencies were eliminated. No programs ended. If any Deep State apparatchik lost his job…he just bided his time for the next administration!
Look, we’d be a damned fool to argue that there is no difference between Russia and the US and say, Iraq. But the differences are not always as clear and stark as we imagine.
The masses will go along with almost any great cause. They are the taxpayers…consumers…‘cannon fodder’ for war…and ‘useful idiots’ for the whole elite agenda. Mob Man is always ready to back his leaders…and get up to mischief. Russians support Putin. Ukrainians support Zelenskyy. Americans support Biden. And Germans supported Hitler right up until the Soviets turned out the lights.
Taken into a private room…shown the facts…and all the money spent…all the programs…all the bureaucrats, do-gooders, spooks, and paper pushers…and then handed his share of the bill, the average voter would surely recoil in horror. But he still wouldn’t feel qualified to cast judgment on any agency or program. Should the Air Force build a new plane? Should hedge funds be allowed to carry forward their losses? Which side should we back in Eurasia — those who speak Russian or those who speak Ukrainian? Those questions are beyond his ken. He is a follower, not a leader. Those questions are for the elite — the experts — to decide.
But now we are wondering about the leaders themselves. Are they all as incompetent as Jerome Powell? Who are they? What do they want?
We promised to name names. And here’s one: Chelsea Clinton. She was never elected to anything. She has little expertise at anything, certainly not medicine. Nevertheless, she was recently in the news after she found it deplorable that people (Joe Rogan was whom she had in mind) should be able to earn money by giving out opinions without prior approval from her and her co-censors.
Interesting, no? She is an influencer. She’s someone whose comments the media believe are worth passing on. She’s rich. She is one of the people ‘the people’ turn to for guidance. She’s one of them — the elite, who actually control, directly or indirectly, US public policy.
So let’s take a closer look at Ms Clinton (aka Ms Mezvinsky) tomorrow.
For The Daily Reckoning Australia