In all the smoke and fog emitted by Trump and his
adversaries, it must be hard to make out the actual issues dogging this
society, and even when you can, to find a coherent position on them. This was
nicely illustrated in Paul Krugman’s fatuous column in Monday’s New York
Times, “On Economic Arrogance” — the title
describes Krugman’s own attitude to a T.
In it, Krugman attempts to account for the no-growth
economy by marshaling the stock-in-trade legerdemain of academic economics:
productivity, demographics, and labor metrics. Krugman actually knows zip
about what afflicts us in the present disposition of things, namely the
falling energy-return-on-energy-investment in the oil industry, which is
approaching the point where the immense activity of getting oil out of the
ground won’t be worth the cost and trouble of doing it. And since most of the
things we do and produce in this economy are based on cheap oil — with no
reality-based prospect of replacing it with so-called “renewables” or as yet
undiscovered energy rescue remedies — we can’t generate enough wealth to
maintain anything close to our assumed standard of living. We can’t even
generate enough wealth to pay the interest on the debt we’ve racked up in
order to hide our growing energy predicament. And that, in a nutshell, is
what will blow up the financial system. And when that department of the
economy goes, the rest will follow.
So, the real issue hidden in plain sight is how America —
indeed all the so-called “developed” nations — are going to navigate to a
stepped-down mode of living, without slip-sliding all the way into a dark
age, or something worse. By the way, the Ole Maestro, Alan Greenspan, also
chimed in on the “productivity” question last week to equally specious effect
in this Business Insider article. None of
these celebrated Grand Viziers knows what the fuck he’s talking about, and a
nation depending on their guidance will find itself lost in a hall of mirrors
with the lights off.
So, on one side you have Trump and his trumpets and
trumpistas heralding the return of “greatness” (i.e. a booming industrial
economy of happy men with lunchboxes) which is not going to happen; and on
the other side you have a claque of clueless technocrats who actually believe
they can “solve” the productivity problem with measures that really only boil
down to different kinds of accounting fraud.
You also have an American public, and a mass media, who
do not question the premise of a massive “infrastructure” spending project to
re-boot the foundering economy. If you ask what they mean by that, you will
learn that they uniformly see rebuilding our highways, bridges, tunnels, and
airports. Some rightly suspect that the money for that is not there — or can
only be summoned with more accounting fraud (borrowing from our future). But
on the whole, most adults of all political stripes in this country think we
can and should do this, that it would be a good thing.
And what is this infrastructure re-boot in the service
of? A living arrangement with no future. A matrix of extreme car dependency
that has zero chance of continuing another decade. More WalMarts, Target
stores, Taco Bells, muffler shops, McHousing subdivisions, and other
accoutrement of our fast-zombifying mode of existence? Isn’t it obvious, even
if you never heard of, or don’t understand, the oil quandary, that we have
shot our wad with all this? That we have to start down a different path if we
intend to remain human?
It’s not hard to describe that waiting world, which I’ve
done in a bunch of recent books. We’re going there whether we like it or not.
But we can make the journey to it easier or harsher depending on how much we
drag our heels getting on with the job.
History is pretty unforgiving. Right now, the dynamic I
describe is propelling us toward a difficult reckoning, which is very likely
to manifest this spring as the political ineptitude of Trump, and the
antipathy of his enemies, leaves us in a constitutional maelstrom at the very
moment when the financial system comes unglued. Look for the debt ceiling
debate and another Federal Reserve interest rate hike to set off the latter.
There may be yet another converging layer of tribulation when we start
blaming all our problems on Russia, China, Mexico, or some other patsy
nation. It’s already obvious that we can depend on the Deep State to rev that
up.
* * *
Note: The blog is sponsored this month by David
McAlvany’s firm, ICA. Find out why investors have used them since 1972 to
acquire physical gold and silver, and request free information, by
visiting: http://mcalvanyica.com/investorkit/
