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The Global Economic System is Reaching Its Limits

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Charles Hugh Smith

Charles Hugh Smith

Charles Hugh Smith has been an independent journalist for 22 years. His weblog, www.oftwominds.com, draws two million visits a year with unique analyses of global…

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After Two Years of Financial Turmoil Nothing Has Changed

Despite the legislative churn that produced thousands of pages of new laws and regulations and much self-congratulatory PR, nothing of any importance has changed.

All the truly important systems remain completely status quo:

1. The U.S. Global Empire continues to export paper (a.k.a. U.S. dollars) in exchange for real goods.

2. Global owners of capital and the Empire's owners/managers continue to buy the Empire's bonds in their endless trillions.

3. No Imperial war has been declared over and the troops withdrawn.

4. Not one of the hundreds of U.S. overseas bases has been shuttered; rather, new ones have been established and existing ones hardened and expanded.

5. The "too big to fail" banks have grown even larger and thus even more securely protected from failure by the Savior State.

6. The national Security State continues expanding at a staggering rate, seeking global hegemony over all electronic communications even as its own sprawling tenacles have no awareness of what the other tenacles know or don't know.

7. Thanks to "healthcare reform" (sic), the sickcare cartels have tightened their grip on the nation's income stream.

8. Lobbyists still control the lawmaking machinery of the Federal government. Indeed, any real reform has been attacked like a carcass tossed in a piranha-infested river; reform has quickly been stripped and then repackaged as a gutted faux reform for PR purposes.

9. The wealth/income/power gulf between the top 5% and the bottom 95% of citizens continues widening.

10. The two political parties continue spewing propaganda-laden facsimiles of the ideologies that once powered their values: both are owned or leased by the financial Power Elites and other cartels/fiefdoms. Neither party has any plan other than "extend and pretend" the status quo.
"Tax cuts" are double-speak for enriching the wealthy and saddling future generations with unpayable debts: "tax and spend" is now "borrow and spend" to both parties.

11. All the thousands of pages of "reform" legislation merely tweak the parameters of entrenched fiefdoms and cartels; the insurance and other sickcare cartels are firmly in control ("more studies" is always the marketing ploy proffered as "reform"), the military-industrial cartel/State partnership's revolving door still spins, etc.

12. Not one major weapons system has been cancelled; weapons procurement programs are shaved and stretched over more years, increasing their costs.

13. No real effort has been made to enforce laws which might bring indictments of the financial Power Elite players who gamed, embezzled, plundered and looted the nation's financial system.

14. The overhang of uncollectable debts in the nation's real estate (residential and commercial) remains firmly in place; "extend and pretend" the status quo is the order of the day.

15. No one in the nation has learned to say "no;" sacrifice is something reserved for those at the tip of the Imperial spear.

16. The nation's Power Elites have no plans for adapting to new realities; their only plan is to keep applying the same "fixes" that "worked" over the past 60 years: Keynesian "stimulus" to the Elites and fiefdoms, 2,300-page excretions of arcane, incomprehensible legislation, bailouts of politically powerful unions and other fiefdoms, more benefits showered on reliably self-centered voter blocks (seniors and other recipients of Savior State largesse) and more corporate welfare for the cartels and monopolies which fund their costly campaigns to con the great unwashed.


17. "Innovation" stays safely corralled in the realm of toys, gadgets and social media. Real innovations in education, governance, the legal system, etc. that threaten the status quo fiefdoms and Power Elites are smothered at birth.

18. The rot at the center of the Empire--the culture of lies, marketing, prevarication, misrepresentation, embezzlement, parasitic looting, cheating, gaming the system and ceaseless distractions, the culture based on presenting facsimiles as "the real thing," remains firmly in place, strengthened every day by the political classes' prevarications and PR and the notion that lying, cheating, stealing and hiding the truth are all "the name of the game" and justified to nail down your share of the swag. That is the national politics of experience which remains safely unexamined.

Nothing of any importance has changed. The engine of Empire is lugging a bit as the load increases, but the Empire's army of high-caste technocrats are hard at work, securing their perquisites and fat paychecks by keeping the sprawling global machine running.

Just as in the late stages of the Roman Empire, magical thinking abounds. This is America, the capital of can-do! We are audaciously hopeful because we always arise, newly envigorated by the unquenchable spring of American innovation, blah blah blah.

Thus is truth silenced because it might be painful, and require actual change rather than highly glossed facsimiles.

Charles Hugh Smith has been an independent journalist for 22 years. His weblog, www.oftwominds.com, draws two million visits a year with unique analyses of global finance, stocks and political economy. He has written six novels and Weblogs & New Media: Marketing in Crisis and just released Survival+: Structuring Prosperity for Yourself and the Nation.

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  • Anonymous on August 23 2010 said:
    Well said...it is sad to hear, but so true :sad:

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