The Nexus of Tragedy

(AP Photo/Hussein Malla)

People occasionally tell me that what I describe as an upside down crazy world is nothing more than me overreacting to everyday events.  Maybe so…  I am passionate about what I believe and about caring for others.  My thought however is that if news stories were puzzle pieces that fit together to form a larger picture, that picture would not be a pleasant one.

My problem in today’s upside down crazy world is that too many of the normal stresses and strains on the cultural fabric that makes up our civilization have been exacerbated by corporate greed and government malfeasance as is exhibited by the reckless borrowing, foolish spending, and cultural degradation of today’s world.

While these trends are not new and have been out of control for decades, the ever increasing rate of deterioration is increasing at an increasing rate.  We are literally witness to a nexus in history, I think.  Americans have been blessed and live comfortable controlled lives, largely protected from the worst tragedies in life.  My concern is that we have surpassed a breaking point and our comfortable existence is now at risk.  None of us care to acknowledge just how serious things like the national debt, an uncontrolled border, corporate theft, or a lawless government are.  We just go on with our lives and hope that things will get better.  Even my family continues to go to work and pay the mortgage.  I am still even contributing to my 401K regardless that I have very little faith that 401Ks will survive what may be coming.

I guess, like many people, I hope I can make it the five and a half more years I need so that I can get my money out of the system and use it to set up the economy I will depend on in retirement.  Sure, I have taken steps to mitigate the risk, but as my characters Catherine, Megan and Annie learned in Phoenix Republic when their comfortable world simply ceased to exist, collapse builds for a long time but takes place in the blink of an eye.

Consider, if you will just a sample of news stories from the past week.  A caliphate now exists in the heart of the Middle East.  Syria, Iraq, and Now Israel are embroiled in fighting.  If you don’t believe that this is a battle for civilization you are living in denial.  Again today another story talks about Christian’s being threatened with the worst possible fates.   ISIS Has a Deadly Ultimatum for Christians

(AP Photo/Charlie Neibergall)

Tens of thousands of desperate people are flooding across the US southern border all but unchecked.  The United States government not only refuses to enforce the law, but is actually encouraging the situation.  States like Texas are now forced not only to careg for the illegal immigrants, but to take extraordinary steps to try to stem the flow by guarding their borders on their own.

Gov. Rick Perry Says Texas May Soon Take Steps to Secure the Border — With or Without the Federal Government’s Help

We have The Organization for Economic Co-operation and Development (OECD) talking about the increase in income disparity between investment holders and wage earners.  As most of us earn and live off of wages in the USA and in Europe the vast majority of citizens are finding it more and more difficult to maintain their standard of living.  The problem is an increasingly out of touch elite class continue to talk about taxing their citizens while ignoring the other half of the equation which means reducing the cost of government.  All the while, the economy continues to decline which also puts pressure on average citizens.  As the article points out there is a point where civil unrest is unavoidable.  The only question is where is that redline?

When life is too broken in too many places it is easy to just give up, but my thought is that even now one must prepare and try to be a blessing for others.  Life will go on even if the current paradigm fails.  All that giving up means is that one will be more dependent and more at risk than otherwise they might have been when that time comes.  Even in a crazy upside down world there are things to live for.  We have family and loved ones to cling to and to protect.  We have faith and we have hope.

What will your world look like in a year, or two, or five?

 

Resources:

http://www.theblaze.com/stories/2014/07/19/isis-to-christians-convert-to-islam-pay-us-leave-or-die/

http://www.theblaze.com/stories/2014/07/17/gov-rick-perry-says-texas-may-soon-take-steps-to-secure-the-border-with-or-without-the-federal-governments-help/

http://www.zerohedge.com/news/2014-07-18/oecd-fears-middle-class-civil-unrest-coming

Headlines and Hostility

A big part of writing is talking to readers about your book.  Actually, in my opinion, the most interesting part of writing is about talking to readers about what they think about the world.  As Phoenix Republic is a dystopian novel about a financial collapse of western culture, my discussions tend to be about what inspired me to write such a gloomy novel, or is something like what happened in Phoenix Republic really coming to America?  I often answer by asking people to scan the headlines and ask themselves if what they see gives them a feel for life in America today.  In the last couple of weeks we had some of the following headlines about stories that any one of which would have been earthshaking only a few years ago.  Today they are more or less all happening all at one time.  Here are just a few examples.

US Media Restricted at Border, Federal Agent Cites Safety Concerns

Bobby Jindal: ‘People Are Ready for a Hostile Takeover of Washington, D.C.’

Iraq Update: Air Force Runs Out Of Missiles, ISIS Controls The Border; Shiite Clerics Threaten US Troops

Think about it, there are signs posted in some areas of the US where authorities actually inform American citizens that the area is dangerous to travel in.  Tens of thousands of people are crossing our borders with no way to determine who they are.  As a nation the US has spent trillions of dollars on Iraq, which now appears to be collapsing almost overnight.  The Middle East could descend into civil war any day now.

If that happens, the price of oil will almost assuredly skyrocket. America burns 15 million barrels of oil a day while only producing 8 million barrels of oil a day.  Obviously we are bringing in 7 million barrels of oil a day from other places.  One of those places is the Middle East.  Instead of Washington DC working feverishly to secure oil from Canada and to dramatically increase our own production, it is working to reduce our capability and has killed the keystone pipeline project.  If war does break out, western nations will be in deep, deep trouble.

If this isn’t enough, consider that our National Debt is growing at an unsustainable rate.  Think about it.  Compare the percentage of GDP American leaders have committed us to now and what we were on the hook for just a few short years ago.  Come on.  Regardless of politics we all know this doesn’t work.  It isn’t magic.  If nothing else, think about it as if the numbers below were personal.  If you had a relative that borrowed $1,000 dollars on a credit cards every month in 2008 and were now borrowing $1,700 dollars a month today, or 99% of what they earned, you would think they were completely delusional and would be thinking about intervening.   Regardless of the scale of the problem, it is the same paradigm.

2008   $10,000,000,000,000,   or about 68% of America’s GDP

2014   $17, 000,000,000,000   or about 99% of America’s GDP

Where am I going with this?  I will tell you.  In my opinion, our country is too broken in too many places to ever fix unless we can find a way to address our issues honestly very soon.  As I have written about in other articles, there are two Americas.  We are dangerously divided and sadly, this is our biggest challenge.

In 2008 the economy came dangerously close to collapsing because crony capitalism / crony socialism is failing.  The federal government encourages people to spend foolishly and lenders are more than happy to borrow money at zero percent interest and loan it out risk free to borrowers.  Prior to 2008, Wall Street was all about selling mortgage derivatives which basically amounts to fractional ownership of a home loan.  The problem with this idea is that things can become unpleasant if the loan isn’t paid, and the owner of said derivative is using their stake in that asset as collateral on yet another loan.  The bottom line is that ownership become hopelessly conflated.  Good loans were packaged together with bad loans, resulting in a mortgage market where no one knew what something was worth.  As the bubble popped and prices plummeted, it became a death spiral.

Companies collapsed, Americans lost jobs, and in an effort to retain political power, politicians rushed in to pass legislation to make it look like they cared and had a plan.  It would not do to have Americans panic. Washington rushed in to create money out of thin air to throw at the problem.  Americans were incentivized not to work as unemployment was extended and extended again.  The thing is this.  As Washington DC desperately tries to retain power by bribing Americans, they mask the real issues so that they become impossible to fix.  Worse yet, they actually contribute to the problem.  As regulations and taxes increase anyone who actually is productive is forced to fail by the additional burden of government.

Let’s face it, America is primarily a statist nation masquerading as a democratic republic.  Beginning in 2008, the United States political leadership was shocked by a near collapse.  Political and corporate elites rushed to the breach.  They realized that their lifestyles depended on convincing Americans of three things.  They had to find ways to maintain the illusion.  (1) As with Rome, a nation in decline must find ways to pretend that things are not as bad as they appear.  (2) In similar fashion these leaders must find ways to blame someone for the problems faced by the country.  (3) Finally, it’s critical to increase federal power in order to maintain order.  Political leaders in a nation in decline must maintain the status quo to retain power.  These so-called leaders must make us all believe that they must increase the size of the federal government in order to be able to solve the problems facing the country.  They of course fail to mention that they are the ones that caused our problems in the first place.

Most Americans are so busy trying to make their individual lives work that they fail to appreciate the situation on the macro level.  In a nation approaching decline, not only must government have a scapegoat to blame citizen’s problems on, it must find reasons to control citizen’s behavior, to control people’s speech and their voluntary interactions, always with democratic sounding titles.  Things like Net Neutrality become a necessity.  Things like The Affordable Care Act must be imposed to not only control what you do, in this case control your health care, but they must control how you do it.  In other words, they must in some way control every thing citizens do because if they for any reason lost control their dominance would quickly be threatened.

In Phoenix Republic three sisters, Catherine, Megan, and Annie experience first hand what happens when an economic disaster strikes. Phoenix Republic is fiction, but the question is how long will the back story remain so.

Tyranny’s Road

Last week the senate controlled by the Democrats took the unprecedented step of changing senate rules so that judicial appointments now only require fifty-one votes to be confirmed.  For the past two hundred and fifty years that threshold has been sixty votes.  Watching the news last week, I noticed political pundits went on extensively about the meaning and impact of this unprecedented step.  While the change may not seem earthshaking, the results in coming years will be profound.  Regardless of the consequences of this action, only pundits and true political wonks will care, I fear.  The true impact however takes place after it’s too late to do anything to stop it.

Before going into the ramifications that this naked power grab represents; I think that it is worthwhile to define what the rule change is and what is impacted.  First of all, the rule change only effects presidential appointments, excluding the Supreme Court of the United States.  In other words the filibuster is still in place with regard to other legislation and the Supreme Court must still follow the traditional path with regard to constitutional requirement that the senate provide its advice and consent.  For this reason, I have had a couple of people ask me what difference it really makes.  Doesn’t a president deserve the right to appoint the nominees of his choosing?  Didn’t the Republican Party under President George Bush threaten to do the exact same thing for exactly the same reason? Generally, all things being equal, I would say that a president does deserve his nominees and yes, the Republicans did threaten to do the same thing.

The problem I have with these two points is that all things are not in fact equal.  For one thing, today the United States has a seventeen-trillion dollar debt, civil liberties are being destroyed, the federal government is ignoring the US Constitution, and the true unemployment rate is over thirteen percent, with young black males suffering the worst with over twenty-eight percent unemployment.  For another, the Republicans threatened to change the rules, but anyone who is paying attention is aware that they didn’t change the rules, did they?  Mr. Bush was guilty of pushing unwanted government on Americans too, but the current occupant of the White House is doubled down on Mr. Bush’s federal government over-reaches on an unprecedented scale.

The party in power has the absolute right to do a lot of things while they rule.  This rule change could have been enacted at any time in our history, yet it wasn’t.  The United States Senate operated under the sixty vote filibuster rule through the Civil War, both world wars, the Vietnam War, and the War on Terror.  I hardly think that any of these periods in American history were without controversy or disagreement regarding presidential appointments.  The problem as I see it today is that the world is approaching a nexus in history.  Although I believe that life’s pressures do cause history to repeat itself, we are not on a merry-go-round, we are in fact moving through time in a linear manner.  Key events do matter.

The problem with the Democrat Party taking this action now is that it unveils a clear strategy on their part to rule with no regard to the wishes of millions or American citizens.  This rule change will allow the President to change the makeup of the court, and or the ability to seat truly radical federal judges that will be in their positions for life.  Let me ask you something.  Is it a good idea or a bad idea to allow a president who has repeatedly expressed the willingness to go around congress with executive order the ability to stack the courts with appointees that may well support his extra-constitutional excesses?  The framers of the constitution specifically split power up amongst three branches and between the federal government and the states for a reason.  Absolute power corrupts, absolutely.

It seems to me that Rome went down a very similar path.  The Romans fought for freedom, established a republic, and became wildly successful.  Then, after a few generations of being the world’s only super-power, the culture became decadent.  Larger and larger numbers of Romans began to feel disenfranchised and the upper classes becoming lazy as the work ethic declined.  Eventually, it just didn’t mean that much to later generations to be a Roman citizen.  The moral decline in Rome is obvious.  We can see it represented in literature, and in public events such as took place in the Coliseum.  In a word, Roman lifestyles were more and more about instant gratification, gratuitous sex, and violence.  Any of this sound familiar?

Productivity declined causing the relative cost of government and the military to skyrocket.  Supporting the bloated cost of regulation and security became an ever increasing burden to the middle class, yet the entitlement culture in Rome demanded ever-increasing benefits, exacerbating Rome’s problems.  As it is today, some sectors of Roman society were under taxed while others faced confiscatory taxation.  It is today as it was then, all too easy to distract the masses by fomenting economic class warfare, pitting the rich against the poor.  Citizen’s allegiance to Rome diminished, and many supported the rise of a strong-man government over the individual responsibility inherent in a republic.

My point in this little jaunt through history is that when a culture declines it becomes very attractive for the ruling class to change the rules when events begin to become unmanageable.  Phoenix Republic is about western culture becoming unmanageable because it is simply too broken in too many places.  The culture in the twenty-first century United States is fragmented.  Millions of Americans feel that someone owes them something while millions more still cling desperately to the notions of individual, responsibility, and hard work.

By voting to change the filibuster rule with regard to appointments, the Democrats are poised to rubber-stamp judicial and senior administrative appointees with no consideration given to the minority party.  This move thus effectively silences the voices of millions of Americans who oppose Democrat’s progressive agenda of transforming this country.  In other words, I believe it’s credible to say that the United States is now transforming from a Republic into an Empire.  Every time the United States Constitution is disregarded for the sake of convenience or so-called safety, representative government is diminished.

Think about it.  How is an oligarchy of progressive leaders who dismiss the rights of citizens substantively different than the Roman Triumvirates that led to the end of that previous world super power?

Additional Resources:

http://www.forbes.com/sites/susanadams/2013/06/07/the-unemployment-news-is-worse-for-many/

http://www.usu.edu/markdamen/1320Hist&Civ/chapters/08ROMFAL.htm

http://www.bls.gov/news.release/empsit.t15.htm

http://www.youtube.com/watch?v=6XnwBMoPll8

The Once and Future Calamity

Phoenix Republic is a story about average people, sisters, overcoming their reality bias and surviving a titanic shift in the economic underpinnings that make modern life possible.  The story is about what it would be like for a normal person to hold on to their faith, to hold on to their ethics when faced with dramatic change to the very fundamentals of the foundation their lives are based upon.  This blog is about relating the novel to every day events.  This week I was intrigued by something called the “Hindenburg Omen.”  What is it exactly?  Well it is basically a set of technical benchmarks that Keith Fitz-Gerald of www.MoneyMorning.com  noted, has predicted every major market inflection point since 1985.   If the omen occurs twice in a 30 day period, it’s up to 90% accurate in predicting market selloffs resulting in at least a 5% correction within 45 days.  Currently, this set of metrics has occurred 5 times in the last 8 trading sessions.  I was sufficiently intrigued to see what articles might be available.   Looking at www.Zerohedge.com I noticed some interesting data points.

People, corporations, and the government at all levels are carrying more debt than they did in 2007.  The Federal government is in fact carrying 60% more debt than it did in 2007.  Interest rates have risen by 80% in only three months and regardless of the media’s pontification, the economy is obviously still in recession.  Stocks are as overvalued today as they in the “Great Depression” or prior to the housing crash in 2008.  As in Phoenix Republic, not only the United States, but the entire world seems to be hanging in the balance, held together by lies, delusion and false promises.  What might be the result when the music stops?

Like the fictional characters in the novel, most of us have a generally optimistic outlook regarding our future.  That is to say we are more or less optimistic until conditions begin to rapidly deteriorate.  As I read through the headlines over the last couple of weeks, I am captivated by the similarities between our current situation and the reality that the Third Century Romans faced.  For them, corruption, over spending, and security pressures caused arrogant leaders to make mistake after mistake as they sought to maintain their power.

Due to political leaders leveraging Rome to maintain their lifestyles they felt entitled to, and as a result of constant attacks by determined enemies, the financial underpinnings of their civilization became untenable.  The Severan emperors continually dealt with increased budget demands by inventing new taxes, debasing the currency, (quantitative easing…), confiscation of property owned by the rich, (paying their fair share…), and eventually selling imperial assets.  As the strained budgets resulted in declining infrastructure within the empire, the military also suffered as increasingly the cash strapped government was forced to begin relying on lesser quality soldiers from outside the empire, (the Barbarians).  As you might expect productive Romans, especially in the provinces, revolted, further weakening the empire.

It is frightening how familiar the story is to our current paradigm.  As Mr. Bernanke announced an end to quantitative easing, what will be the effect on the markets and thus our lives?  Rising interest rates will hit everything from home and car loans to credit card borrowers to people with leveraged investments.   My thought, is just maybe we should all be wide awake and staying frosty as events unfold.

God bless and good luck!