L: Doug, a hot topic of conversation this week is the
man who flew his airplane into the IRS building in Austin, Texas. What do you
make of it? Is the guy a hero for the downtrodden taxpayer? Or a terrorist?
Or just some lone lunatic?
Doug: First, I’d say we
have to define what terrorism is. The generally accepted definition being
that it’s the use of violence to create fear in a society in order to
induce political change. I don’t think that’s the case here. So
I’d say this was just an angry man, acting as an individual, attacking
those he saw as destroying his life. The fact of the matter is that it was an
act of revenge, not terror.
But according to the FBI, terrorism is the unlawful use of force or
violence against persons or property, meant to intimidate or coerce a
government or the civilian population as a means for achieving political or
social goals. It’s to their advantage to see this as an act of domestic
terrorism. It makes their jobs seem important and will result in more
personnel to fill their gigantic new Homeland Security complex in DC, and
more funding to look into Americans’ comings, goings, and thoughts.
L: Heh – so if it’s lawful use of
force to intimidate the population, it’s not terrorism.
Doug: Of course; that’s a
key word, completely unnecessary to the real definition of the word, and one
that opens a real Pandora’s Box. From Big Brother’s point of
view, it’s always "do as we say, not as we do." Based on the
FBI definition, state terrorism apparently isn’t terrorism, because
it’s lawful.
L: Okay, so, given that the explanation the guy left
behind goes beyond simply saying
"I’ve had enough" to stating that violence is now the only
solution, and calling for revolution, I guess that makes him a terrorist, by
the FBI’s definition.
Doug: Well, I suppose. His call
to violence seemed like an afterthought to me. In reality he’s just
calling for the righting of egregious wrongs. However, it’s getting to
the point in the U.S. that you have to be careful about even complaining, or
you might be put on some kind of "watch list." You actually better
be careful about what you say, and how, and to whom. The walls have ears, as
the Soviets, among others, used to say.
The media has downplayed his letter as a "rant" or a
"screed" penned by a lunatic, partially to be self-righteous and
partially to discourage others from reading it and thinking about it. But it’s
actually worth reading and thinking about. It’s not that often you get
to read a suicide note written by what appeared to be quite an intelligent
guy. His letter is a little disjointed, agitated, and a bit ungrammatical at
times – after all, it is a suicide note – but it’s not at
all irrational. And I suspect he put his finger on what is probably going on
in the minds of a fair percentage of the population.
You know the old saw people once used, but don’t anymore, as
it’s become politically incorrect? Three guys are doing the same thing,
and one says, "I’m a freedom fighter. You’re a rebel.
He’s a terrorist.’" So, bandying these terms around makes
conversation difficult. The FBI’s definition is self-serving and, in
this case, serves – perhaps not accidentally – to obscure the
truth of the matter.
L: It was always darkly humorous to me that in the
Reagan years, the same people the lawfully constituted government of
Nicaragua called rebel guerillas, the U.S. called freedom fighters –
and yet the U.S. helped Saddam Hussein put down rebellion when he was an
ally. Not that I cared for the socialist government of Nicaragua. The point
is that if "we" like them, their opponents are terrorists, and if
"we" don’t like them, their opponents are freedom fighters.
It’s so hypocritical.
Doug: It’s perverse enough
to be black comedy. I think this needs to be looked at from a personal point
of view. Here was a man who was apparently just going about his business. He
quite justifiably resented the government taking forty-plus percent of
everything he produced. And worse than that, they were making it hard for him
even to produce. They made his life miserable. He spent much of his time and
money trying to fight within the system and got nowhere. Perhaps that was foolish
of him, perhaps he should have just rolled over on his back and wet
himself… just done what he was told and paid what he was told to.
It’s the New American Way.
On a moral plane, I think it’s important to remember that groups
of people can have no rights that the individuals who compose the group
don’t have. In other words, if an individual does not have a right to
do something himself, then neither can he delegate that right to a
politician, policeman, nor some other authority. If it’s not his to
give, he can’t give it.
If I don’t have the right to take money by force from my
neighbor, I don’t gain that right by teaming up with others. A bunch of
people voting for it doesn’t make it any more right. Suppose, for
instance, a neighborhood voted to hire a motorcycle gang to defend it and
"authorized" that gang to levy taxes by force, including on
residents who didn’t want to go along with the plan. Most people would
say that’s wrong. But somehow, if the government does exactly the same
thing, people see it as okay.
There’s no difference in this instance, morally, between the
motorcycle gang and the government. Of course, this calls to question the
legitimacy of the state itself, as an institution.
L: Indeed. And I’d like to talk to you about
your anarchist tendencies, but that’s a long topic, perhaps for another
day.
Doug: Okay, but one other thing
I’d like to point out about this incident. It’s a clear sign of
the direction in which warfare is going – we talked about this very
sort of thing in our conversation on the military. Warfare is becoming what you might call "open
source." You no longer have to get an army together, teach them how to
spit-shine boots, and attack another army. We’re approaching the end of
direct conflict between standing armies. This trend has its roots at least as
far back as the American Revolution, during which the British were outraged
that the Americans wouldn’t stand and fight. They’d take potshots
from behind trees and then run. They even shot officers – officers!
– from hidden positions. Most ungentlemanly.
Today fighters no longer need the aegis of a government. Instead, they
organize loosely, for ideological or other reasons, and strive to sting with
maximum effect, while presenting the smallest, least useful target for
retaliation. They realize that with $100 they can cause a million dollars of
damage. Wars are won on economics, in the long run. It is, for instance,
quite stupid of the U.S. government to think that it can quash Al Qaida or
the Taliban the way the Spanish took over the Aztec and Inca empires –
by grabbing the guys at the top. There is no head to strike off.
To head off flaring tempers and angry letters, let me make it very
clear I am not defending these groups. I’m very much opposed to them.
If either the Taliban or Al Qaida came to power where I live, no doubt
I’d be among the first they’d want in front of the firing squad.
But quashing individuals in such loosely organized groups, no matter
how important they might be, doesn’t quash the reasons why such groups
exist. It’s like whacking a hornet’s nest. Once you whack one,
you don’t have just one hornet’s nest to deal with – now
you have hundreds of completely unrelated hornets to deal with, all attacking
you, because each sees you as his enemy.
L: It occurs to me… the U.S. Army has, or had
– I’m not sure if it’s current – a slogan: "An
army of one." The idea was that each U.S. soldier’s training would
make him or her so capable of individual devastation, each one counted as an
entire army.
Doug: I remember that.
L: Well, I wonder if it’s dawned on any of
these geniuses in the Pentagon that the same is true – much more
true – for their opponents…
Doug: [Laughs]
L: This incident in Austin is an example. This
individual man decided to strike out at the U.S. government. Whether you
approve or not, you have to admit that he created quite a stir, especially
for a simple impromptu action. He made an army of one of himself – and
since one individual can keep a secret, that sort of army is all but
unstoppable.
Doug: And it’s the way
things are evolving all over the world. In previous times, you needed to
organize a bunch of people to do serious damage. But with today’s
– and especially tomorrow’s – technology, the individual is
increasingly empowered. Let’s look at the big picture. This guy, Stack,
was just one individual; but at this stage in the deepening crisis, there are
a lot of people in similar circumstances. Millions of Americans have lived on
maxed-out credit cards for years, and more than six million have lost their
jobs since the current bout of crisis started. These people were already on
the ragged edge. And the single largest expense in everyone’s life is
the government.
At least that’s true for productive people. In my own case, it
costs me far more to support the U.S. government – which does
absolutely no good for me whatsoever – than all the rest of my living
expenses combined.
L: Hm. Let’s see… My earnings are far
more modest than yours, and I pay about three times more in taxes than on
housing – and that includes two houses. I hadn’t thought of it,
but I can’t imagine that food, utilities, and other bills would even
match my housing expenses. So I guess that the direct cash cost of the U.S.
government is also much more than all my other living expenses combined. And
that’s not even counting the cost of regulation, indirect taxation
through inflation of the money supply, etc., etc.
Doug: I think there are millions
of people out there like you, in that regard. But unlike you, most of them
are also deeply in debt. A large number of them are close to the edge –
and many could easily go over it, like this guy in Texas. There’s a
rage out there, largely incoherent but real and powerful, and some are
starting to strike out against this grasping octopus of a government
that’s reaching its slimy tentacles into every aspect of their lives.
It could be that we are reaching a critical mass of such people, the
so-called "100th Monkey Effect."
L: It’s a question of how much of an anomaly
this guy really is. I know that in the pro-gun community in the U.S., many
people feel that the U.S. government lost any shred of moral legitimacy as a
result of the Waco massacre. And some have wondered why people who are, by
definition, armed and trained in the use of weapons, have not dropped the
hammer on the government thugs that come to take their guns (in blatant
violation of the Constitution and the human right of self defense).
I suspect that the gilded cage most Americans live in has just been
too comfortable for them to toss everything and turn violent. But that may be
changing now, with more and more people being pushed over your ragged edge.
Clearly, a guy who flies an airplane into a building, as in this Austin case,
thinks he has nothing to lose. If a lot of people who think they have nothing
to lose are pushed beyond the edge, things could get pretty ugly in the U.S.
very quickly.
Doug: Entirely possible. People
forget that this type of thing has gone on in many countries, across history.
As bad as the Greater Depression promises to be, anything is possible in the
U.S. Americans don’t expect anything… weird… only because
they’ve been uniquely blessed so far. It’s too early to say
whether this act will spark other similar actions, but there’s already
another story of a man who decided he’d had enough and wasn’t
going to stand by while a bank seized his home. So he bulldozed it, while it was legally still his.
L: I heard about that. Apparently the guy even found
a source to pay off what was owed, but the bank refused because the man owed
less than half of what the house was worth, so they could get more by
foreclosing and selling the house.
Doug: You know, when individuals
start taking actions like this, it can change things. An army of one can
sting, but what happens when you have 100,000 armies of one? Or a couple
million? Just think of what would have happened back before WWII in Germany
if each one of the millions of Jews and Gypsies and others the Nazis rounded
up had fought back. The death camps were made possible by people who,
although they had the capacity to act like wolves, acted like sheep.
I’m not saying things will go that way in the U.S. But I do think
there’s increasing resentment on the part of the average citizen
against those who work for "The Man."
L: It comes back to hope. As long as people have a
shred of hope that things might get better, or at least that they themselves
might survive, most won’t embrace violence, because that sets you
irrevocably on a path that can very easily get you killed.
Doug: Although it’s true
that nobody gets out of here alive, it’s natural to want to delay the
eventuality as long as possible. But when you push a person far enough, he
doesn’t care anymore – as recent events have shown.
L: That’s pretty scary, Doug. Given how few
Americans have savings – or even a work ethic – and given what
we’ve been saying in this conversation, a protracted economic crisis
seems like a recipe for violence in the U.S. What happens to a people who
think that the Good Life is winning a lottery or suing McDonald’s for
millions of dollars, when their jobs go away and don’t come back? And
if, on top of that, the cost of government goes way up, to pay for all the
so-called stimulus programs and social spending the government has on
tap… Well, a lot of rage seems inevitable.
Doug: We didn’t talk about
this in our conversation on movies, but there was a movie made about 25 years ago, starring
George C. Scott, called Rage. In it, the government killed the hero’s
herd of animals in some sort of nerve gas experiment gone wrong. The hero
decides to take the fight, as an individual, to the army base that did the
test.
The interesting question is: at what point do such actions reach a
critical mass that renders a society non-viable? Although the average person
doesn’t seem to have a clue what really caused this crisis, he deeply
resents the bailouts and the worthless corporate "suits" who continue
reaping multi-million-dollar bonuses. The system is rapidly losing
legitimacy. What little is left of the free market will be blamed for what
was caused by government intervention.
That in mind, it’s worth noting that the government’s
response to the current crisis has been to do more of the exact same things
that caused the crisis. These buffoons are not just doing the wrong thing;
they’re doing exactly the opposite of the right thing. Too much debt
sent the economy into a tailspin, so the government throws more debt at it.
They are printing more and more dollars, which is going to result in
widespread capital destruction. And they are hiring swarms of bureaucrats to
gum up everyone’s lives – while paying them about 60% more, on
average, than people make in the private sector.
L: And it just piles on – like in a Rugby game.
Speaking of movies, there was a movie made back in the early ’90s,
called Falling Down.
Doug: With Michael Douglas
– I saw that.
L: The protagonist is just some unemployed guy who
gets pushed over the edge and "goes postal." But what you’re saying is that
there’s a pattern here, and that even though the actions are
individual, a large wave of them is… predictable? Inevitable?
You’re talking about blood in the streets, Doug – is that really
where you think things are headed?
Doug: I’m sorry to say it,
but I find myself coming to the conclusion that we may well be reaching such
a point. I don’t see any way out, not without a lot of pain and
turmoil, at this point.
L: That brings us to the concept of unintended
consequences. Not least because the Austin case seems related to incidents in
the book by John Ross by that
name.
Doug: Governments are constantly
passing laws with certain stated objectives; the real objective, however, is
to further the interests of the politicians behind them. Sometimes the stated
objectives are met, sometimes not, but there are always unintended
consequences, and they are usually unwelcome. In the case of the government
meddling with the economy, including an increasingly rapacious tax code, the
unintended consequences can include a violent backlash, like this one.
We’re talking mostly about the U.S. here, but the problem is not
limited to the U.S., by any means.
In his book, John Ross explains how one thing can lead to another, and
unintended consequences can get totally out of control – even to the
point of revolution. Ross couldn’t get the book published – it
was considered too much of a political hot potato. So he self-published, and
it’s sold something like 75,000 copies in hardback, by word of mouth.
That’s an incredibly large number, especially for a novel. And that
tells us something about what a lot of people feel.
L: One of the connections between that book –
written in the mid-’90s – and the Austin case is that Stack takes
a pot-shot at the FAA in his note. Coincidentally, it’s excessive and
abusive action by the FAA – an agency most Americans barely even know
exists – that’s one of the sparks of revolution in the novel.
Doug: The book was worth reading
before and is all the more worth picking up now. And there’s another
book that deals with this theme, by my friend Boston T. Party, a well-known
gun-guru. It’s called Molon
Labe, after
what the Spartans told the Persians at Thermopylae. When the Persians
demanded their arms, the Spartans responded: "Come and take them."
What’s particularly pertinent in that book is that individuals pushed
too far by the government fight back – not to start a revolution, but
as individuals responding to individual thugs, who just happen to work for
the government.
I hate to say it, and I’m not encouraging it, but the truth is
that it’s entirely possible that this could happen, even in the United
States.
Another work of fiction that deals with this is, of course, V for
Vendetta, which we
spoke of in our conversation on movies. Incidentally, at about the time when
that movie was supposed to be released in England, there was apparently an
act of terrorism, and they decided to delay the release of the film.
L: Another novel along these lines is Vin
Suprynowicz’s The Black Arrow. Have you
read it?
Doug: No, but I know Vin is a
solid libertarian thinker.
L: So, government action may have unintended
consequences. But even though they’re unintended, we can’t say
the consequences are unimaginable, or even unpredictable, since all of these
authors clearly saw the possibilities for the sort of thing that this Austin
event might lead to.
Doug: As angry individuals lash
out, feeling a kind of inchoate rage, it’s entirely predictable that an
increasing number of those targets are going to be in government. Back in the
early ’80s, when there was a serious tax revolt brewing, before the
Reagan reforms, I was told a first-hand story about a guy who, when
confronted by a threatening IRS agent, collared him and took his
driver’s license. He looked at the address, then grabbed a tomahawk he
happened to have, smashed it into his desk, and said: "Pal, it’s
you and me. It’s not me and the government. I expect you to go away, or
you’ll have to deal with me in a very personal manner." Of course
the agent could have reported the incident, but he figured it would be wiser
to just close the case and go on to the next guy. Who needs the risk?
L: That is very much the theme of books such as
we’ve been talking about, especially Unintended Consequences, in
which taxation and regulation become very difficult for the government to
enforce, because individuals who’ve been pushed too far start fighting
back. Once the badge and the uniform stop intimidating everyone into
compliance, and especially once uniformed thugs face personal, physical
danger, being a thug stops being much fun anymore.
Doug: And very few of the people
who wind up taking radical measures will actually be radicals, as they
generally were in the ’60s. Most will have no philosophical or
theoretical basis for their actions; they won’t think of themselves as
revolutionaries. But a lot of these ordinary Joes will act. And if they act
in large numbers, it could turn into a major social upheaval. Could we be
getting to a tipping point? I don’t know, but there are straws in the
wind.
Another book on this subject is a rather hefty new one by Jim Davidson
– not James Dale Davidson, but the other James Davidson who deals in
similar subject matter – called, Being Sovereign. Unlike
the others, it’s non-fiction and runs to more than 600 pages, with a
lot of very cogent material related to what we’re talking about.
It’s quite eclectic, well researched, and full of interesting gems of
data. I wonder if the memes in books like these will start spreading through
society more, now that the economy is on the rocks – now that the
gilded cage you mentioned is no longer so comfortable.
L: Could be… such books would have appealed
only to anti-government types before, but now, with fear and anger sweeping
through the population, who knows if such seeds won’t be much more
widely dispersed?
Doug: I don’t know –
but it’s as interesting as it is horrifying to watch the slow-motion
train wreck of the U.S. and global economies continuing.
L: Okay, Sunshine. Investment implications?
Doug: I would have to say that,
generally, they’re not very good. At least not for the kind of stuff
your broker at Merrill is told to recommend.
L: [Laughs] I think I’ve heard this song
before… But can you be more specific?
Doug: Well, I sure wouldn’t
want to own any government bonds…
L: [Laughs]
Doug: [Chuckles] No bonds. And
owning the government’s currency is going to be an extremely bad idea
when inflation gets really bad – which it will do. If they wind
up destroying the dollar, we’re in for really serious trouble –
which looks like exactly what’s going to happen. And I don’t
think people are going to panic out of greenbacks and into the stock market,
not when corporate America is looking so shaky.
L: Don’t hold your punches, Doug...
Doug: I won’t. I think
we’re on the ragged edge, and this Austin thing is a clear warning shot
across the bow. It’s absolutely time to start rigging for stormy
weather, if you haven’t already.
L: Which leads us to your mantra of diversifying
one’s assets, and entire life, out of a single political jurisdiction,
especially the U.S.
Doug: For openers. And if you
don’t have a significant part of your assets, wherever you are, in real
money – that’s to say, gold – you’re putting your
neck on the block. Real estate is going to get taxed to death, paper
currencies are circling faster and faster down the drain, government debt is
a joke. This is a really, really serious set of circumstances that’s
building up.
People need to start thinking in terms of a major turning point
approaching.
I won’t try to predict all the details, but I will say you
better prepare for big changes over the next decade, or you will get run over
by events.
L: Got it. Note to self: avoid becoming roadkill. I
guess you’ll have more specifics in future editions of The Casey Report?
Doug: Yes. I’m working on
an article on China for the next issue.
L: Can you give us a sneak preview? Are you bullish
or bearish on China?
Doug: I’ve been a bull on
China and the Orient for many years, but times have changed. China could be
in even bigger trouble than the U.S. The problems in Greece are going to
spread; I’ve been predicting the euro was going to disintegrate for
some time. What’s going on is a worldwide phenomenon.
L: Well, that sounds pretty grim. But it is what it
is. It may seem pretty extreme to think about, let alone plan for, the U.S.
busting apart at the seams, but if this Austin thing – and the guy who
bulldozed his house – are the leading edge of a wave of action and not
just isolated incidents, it would be stupid, by your definition, not to think
and plan.
Doug: It always pays to plan for
the worst while you hope for the best.
There are times in history when sweeping social changes seem to come
out of nowhere – to most people. But we can clearly see signs of this
one coming, and there’s still time for people to get their own houses
in order. Get out of debt. Accumulate capital. Protect yourself from currency
destruction with gold. Diversify your assets across political jurisdictions.
All the things we’ve talked about.
L: Okay Doug. Thanks for another interesting, if not
exactly cheerful, conversation.
Doug Casey
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