Riddle me this Batman: With the entirety of the Western Democracies crumbling under crushing debt; the Greeks, Irish, Portuguese, and Spanish turning to the sole-remaining Western European industrial power Germany , who in turn looks to the US for bail-outs of NEVER-sustainable social-welfare spending programs; what is backing all of this? Back in the sane years of the US economy, with each dollar printed by the US Treasury backed up by an actual physical piece of gold (still valued for over 10,000 years), there was a level of verifiable trust between the provider of a product or service and the consumer of said product and service. Fast forward to now. At least in America, the public sector unions and auto unions have driven to ridiculous levels, the price of domestic labor. Simply, put, auto workers and government workers are not worth their wages in an open market system. Consider GM. The union wages and pension plans bankrupted GM. The automaker was forced to cut costs in nearly all aspects of their operations, except for their human capital. The result was overpriced, inferior products (and in an open market, Japanese and other manufacturers quickly overtook these hunks of junk), which naturally decreased sales, which decreased profits, which caused their rapid demise. Then, we were told the companies were ‘too big to fail’ and the government stepped in, screwed the investors by paying them pennies on the dollar in settlement, handed the companies over to the auto unions, and profited from the entire operation with tax dollars (deficit, tax dollars no less).
The same happened with the public sector. Except, like the car companies, there is no need for a middle man. All the government needs to do is essentially print money. Cue Orwellian-phrased quantitative easing one and two. The state governments of California and New York are broke with public sector-employee spending at NEVER-sustainable levels. (New Jersey looks like it may yet be saved by a politician who actually gets it, and has touched the third, and fourth, and fifth rails of state politics, tackling the teachers and other unions). If you think Italy, Spain, Ireland, and Portugal are bad. Who do you think is going to hold the bag for California and New York? Texas, and other functioning states!
Back to overseas. While America has the gas pedal floored towards oblivion, the Western Democracies have already spent themselves into said oblivion and are begging the rest of the world for handouts. Meanwhile, Greece burns down, students in Britain are rioting, and the Irish companies look ready to flee as their government seeks to loot the only source of their continued income (It’s no wonder so many companies have sheltered in Ireland as their corporate tax rates are so low). So, Germany, hesitatingly seeks to bail out the socialist-basket cases (probably in continued self-flagellation for their role in earlier wars… I mean seriously, why fund an entire continent of lazy, croissant-snacking, cheese and wine snob leeches?!?!?!). And the only reason they do this, is because… we hold the bag. That’s right, we are now increasing the EU/IMF ‘European Stability Fund’ (think of the porkulus bill on a global scale… a public sector union slush fund for the Western Democratic leeches who have sucked our defense dollars dry for over 60 years… and this is with entire consent of our ruling class of Democrats and Republicans (don’t forget, Bernanke was a Bush appointee)).
Now, I am not an economics major. In fact, I got a C in Economics in college because I thought it boring and un-important (and didn’t show up to an 0800 class). But, I did predict back in 2001 that the Euro was an unsustainable, utopian pipe-dream. Seriously, you think the Germans appreciated their cost of living to double overnight (it did too. I was here then and saw the prices of goods go from 2.59DM to 2.59
DM € overnight (now, the wizards of smart poo-poo this observation by saying wages doubled overnight too. But, doesn’t that prove the point. Inflation of 200% overnight!?!? It works both ways. Trouble is it affects prices before wages. Don’t give me that logic ivory tower))?!?!?! And just this week after seeing that the EU was going to bailout Ireland, I predicted we would again be picking up the tab in the same manner we shored up the German bailout of Greece with the start of this ‘Euro-stimulus’ trash. Do you really need to be some highly educated, ivory-tower, elitist intellectual to understand that if you pay more than you can afford, bad things will eventually happen?
So, then, the ultimate question: What’s next? I pondered that this morning when I thought of the next logical step in this process. OK, it’s musical chairs. Eventually the music stops and who’s standing solo? The Greeks found their seat, the Irish have too, Britain and France look to be trying to rebuild their chairs solo, the Germans found their seats after we said, “after you Frau Merkel,” and we look to be scoping out one of the last chairs while China, Japan, Brazil, India, Russia and others who make our chairs eyeball us expectantly. Who will be holding the bag? China’s Yuan is tied to the dollar (for now, though their abandonment of it in trade with Russia is disconcerting) still. And, China has agreed to continue to fund our debt, buying up another large share of it, even after we publically announced we will print worthless money to pay for it (QE2). Why? Hmmm… mysterious object flying off our coast (do you actually trust the official explanation… oh, wait a sec, there isn’t)… North Korea rattles its saber again off of China’s coast. China almost able to replace its US export market in Africa. A US president who seeks to unilaterally surrender to Russia… even after the Cold War ended. Taiwan… I’d be quaking in your boots about now. Remember, money is simply a tool. Power, and the ability to take, is another tool. China knows how to wield both.
Is all lost? Yes, if we continue to elect incompetent morons like McConnel, McCain, Graham, Reid, etc. and vicious, anti-American power-grabbers like Obama and Pelosi. Sorry, I do not have much optimism. Romney is not the answer. Jindal is not the answer. Cantor just fell like a meteor with his recent comments on Obamacare (preexisting condition coverage is NOT INSURANCE!!!! It’s a payment plan. It’s a bailout for the lazy, and tragically, sometimes, unfortunate). Chris Christie and others like him seem to be the only hope. People who are not afraid to take on the unions and the leeches in American society are our sole remaining hope. It will not be easy… and that is why I am afraid. We need to continue to spread the alarm of fear and doom. Do you want to see your life’s savings destroyed by fiat by Bernanke and company who’s lust for power transcends borders and culture? If not, continue to spread the message.
OK. I’ve rambled enough. Hope it’s coherent enough. Remember folks, I’m just a simple person who understands the times. And, thank God Almighty, I do not place my hope in the institutions of men, otherwise, I’d be pretty much suicidally-hopeless.
But, hey, sorry to interrupt your Dancing with the Stars, American Idol, and NFL games. Lenin was wrong. Religion is not the opiate of the masses… American materialism is.