"Deficit spending is simply a scheme for the hidden confiscation of wealth." ~ Alan Greenspan
The Shape of Things to Come
If you read the newspapers, watch TV or even grab your headlines off the internet, you are continually bombarded by a stream of events. These events are never linked to any overriding theme or purpose. They are just events, presenting themselves for observation--and obfuscation.
Take the "war on terror." If you believe the news, we are in the grip of a terrible onslaught of violence and mayhem. And if you believe George Bush, we are at war.
Now, we all know what war is. I know for sure, I grew up reading about it in "war comics"--those quaint, weekly illustrated mini- books that used to be churned out in the UK during the '50s and early '60s. These comics were all about World War II, and were full of heroic deeds, camaraderie--and, of course, total victory over the enemy. I loved them. So much so, I passed them on to my son, who still has them.
War was clear-cut. We were the good guys fighting the bad guys. There was no room for moral equivocation. Millions died to prove it.
The world has changed, and we are at "war" again. This time the enemy is not any particular state. It is not the Communists. It is not the Nazis. It's Islam--or at least, the fundamentalist, militant form of Islam.
Mind you, Islam has been around a long time. Maybe the Crusades never really stopped. However, fighting ideas with guns is fraught with difficulties.
But war needs imagery. It needs a face. Osama bin Laden is that face. Just as Goldstein was the face of war in George Orwell's 1984. Bin Laden appears on our screens to stir up hate and fear--and our leaders swear to utterly destroy him and his followers.
Yes, it's a face to hate. An implacable face. A serene face. The face of war.
We are told this war is all about those who hate freedom. We are told WE have freedom, and those who hate us, hate us because of our freedoms. However, Switzerland seems safe enough. Perhaps they are not free.
The USA started and continues to pursue a war on Iraq. We've forgotten the reason. Originally it was because Iraq was on the verge of nuking the USA, the UK, or both. Then it was because Saddam Hussein was a bad guy who killed political opponents and gassed a Kurdish uprising. Now it's because we're bringing much needed freedom and democracy--at the point of a gun, and killing insurgents in uprisings while we're at it.
With Iraq bombed into freedom, Iran is now the bad boy--for wanting to develop the capacity to complete the nuclear fuel cycle. They say it's for peaceful purposes. The USA says its for making The Bomb. Iran is grumpy. They don't see why they can't do this--seeing as Israel is armed to the teeth. But nobody seems to notice. Double standards, some people call it. But not many.
Here's another news item that is a recurring theme. A story without a plot. The US Dollar is falling. Economists are divided as to whether this is a "good" thing, or a "bad" thing. But it's falling anyway. Meanwhile, George Bush continues to assert that the US has a "strong dollar policy." The truth is whatever you assert--long enough and loud enough. Newspeak.
Must be China's fault. They've tied their Yuan to the USD, so as it falls, their currency falls--and their goods become cheaper and cheaper on the world market. The Yellow Peril writ large.
Then there's the story of the USA's current account deficit. This is big news--because Americans are spending billions more dollars a day than they are earning. Not that they care. The shortfall is made up by foreigners who keep sending goods in return for ever more US dollars--as printed by US printing presses. Maybe the Chinese could print them cheaper? It's called outsourcing.
The European Union is on a growth binge, adding new countries as fast as they can find and groom them. Russia is not happy--as it sees its former stomping ground get peeled off, one country at a time. Putin's KGB background is surfacing. EU bureaucracy is growing.
The Ukraine has an election. Within minutes, the world is calling it a fraud. The CIA, apparently, are active on the ground. The USA says it does not recognise the outcome of the election. We are still waiting for some country to announce it doesn't recognise the outcome of the US election. Oh well. Meanwhile, in the Ukraine, there are calls for separation between pro-West and pro-Russian parts of the country. The leaders won't hear of it--separatism is evil.
The English cricket team plays in Zimbabwe. Interesting country. But apparently, whatever goes on inside that country is not interesting enough for the news. The fact it is being driven to economic ruin and that white farmers are being driven off their land by Robert Mugabe, the "leader from hell," isn't much of a story in the larger scheme of things.
The UK knows all about tyranny--at least in other countries. Meanwhile, they are suggesting trials without juries for terror suspects. Oh, and they just banned fox hunting too. Maybe fishing will be next.
And in New Zealand, just before Christmas, an antismoking ban goes into effect in all pubs and bars. New Zealand has around four million people, and even more sheep. Now it's hard to tell the difference. It seems the property owners weren't consulted.
Is there any sense to all this chaos and arbitrary stupidity? Is there an underlying BIG story which is being obscured by the heat and noise of this continual BS?
I believe there is. But it's not a story you're likely to read about--until after it happens.
Much has been said about the USA moving into "Empire" phase--and books have even been written about it. But I beg to differ. I believe the USA is moving OUT of its empire phase--fast.
Britain once had an Empire. That's why they called it "Great" Britain. Its greatness was built on trade and business--by capturing markets throughout the world. Its currency, the Pound Sterling, was the reserve currency of choice--a rock of economic stability.
All that changed when Britain went to war. War is costly. And after two World Wars, Britain was in hock up to its eyeballs--mostly to the USA. Bretton Woods produced a new reserve currency, and a new Empire--the USA. Great Britain became "little" Britain and its pound was pounded.
The Soviet Union was an Empire of sorts. But it was based on such a shaky foundation--the idiocy of socialism--that it crashed and burned with surprising speed. Nobody remembers it.
The US, like the UK before it, built its wealth on the basis of its freedoms and entrepreneurial spirit. The USA was like a magnet to aspiring individuals everywhere--a place to make one's fortune. All this was represented in the strength of the US Dollar--the Greenback.
And this is the crux of the issue. A country's currency is in fact a barometer of its economic and political health. A currency is subject to a daily "democratic" process of voting--carried by individuals, companies and institutions all over the world.
The value of the paper money in your pocket is determined by the level of "faith" others have in that same money.
Contrary to politicians' utterances, a falling dollar is NOT good news, even though it will allow you to export more goods at cheaper prices. Yes, it does allow for adjustment in economic activity, but in essence, a falling currency is a warning sign of falling productivity, falling confidence, falling prestige, and falling savings.
A falling currency is like an advance bad weather warning. It is shouting out aloud that various economic fundamentals are not right; that current policies are not prudent, are not good in the long term. A storm is brewing.
The point is this: no one really cares if the value of Zimbabwe's currency is falling. It doesn't factor on the world stage. But when it comes to the USD--everybody has a stake in the outcome.
Consider the Chinese. They hold billions upon billions of reserves in USD. At present they are riding the storm--allowing their Yuan to devalue alongside the USD, as it assists their exports. However, that is only one side of the economic coin. Every fall in the dollar represents a fall the in value of their reserves. And at some point, it becomes economically unwise to hold all those reserves in USD. However, selling them will only accelerate the US Dollar's decline. China's secret weapon?
You can understand this easily if you apply it to just one person--yourself. Let's say you have $1 million USD in the bank. If you're an astute person, you will have noticed that your money is losing value on almost a daily basis. What can you do? Well, you could hope and pray--or you could protect your wealth by converting it into a currency that's not depreciating as fast--like the Euro, the Swiss Franc--or even the Australian or New Zealand dollar. Of course, you may even prefer gold. You would have to be a masochist to just sit there an do nothing.
Well, the world is literally holding trillions of US dollars--watching them decline in value. Prudent individuals would have long ago started to diversify out of a devaluing currency--so it should be no shock to realise that nations can (and will) do the same thing.
It's like a stock market crash. At some point, mass psychology takes over, and every man and his dog is trying to sell at the same time--causing a crash in prices.
The same could happen to the US Dollar. And if (when) it does happen, it will cause economic mayhem. But the political consequences will be even more profound. It will likely bankrupt the USA. The dollar will fall from grace--to be replaced by another currency, or something else. If the US Dollar is knocked off its pedestal--then the USA will suffer serious economic and political consequences.
This currency "shift" will cause a geopolitical seismic shift. The economic and political fortunes of nations will undergo dramatic changes--mostly for the worse. Instability will rise and radical new ideas will be put forth to cope with the crisis.
It will be more than the end of the US Empire--and quite possibly the end of nation-states as we know them.
Can such a change happen fast? I believe it can. In fact, history gives us many examples of rapid change. Just consider the Soviet Union. At one moment it appeared invincible. Then with one strike against the Berlin Wall, it literally fell like a house of cards. No one predicted it. No one expected it. It wasn't reported as about to happen in the news. The politicians would never have given credence to the idea. But it happened all the same.
Could anyone have known in advance this would happen? Yes, one group--those who knew that socialism was doomed to failure. But even those people were likely surprised by the speed of the collapse.
Events have a way of doing that--hitting hard and fast. And usually when you least expect them.
Today, we live in what appears to be a "solid" world. Nations appear solid, governments appear solid. Your job appears solid. The paper money in your wallet appears solid. No one is expecting the present order to be hit by a global economic and political meltdown.
However, the news tells a different story. Cracks are appearing. Fingers are already in the dikes. Let's just hope more freedom--the real thing--can rise from the ashes.