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Only Young Societies Are Egalitarian

A quick glance at the USA tells me it takes about 3-400 years for a brand new society of frontiersmen and settlers to settle down into a civilization at equilibrium.

Every mass society that’s been around for any length of time has set traditions and customs, stratified social classes, and the vast majority living close to subsistence with a ruling class and its functionaries controlling most wealth.

This truth began to dawn on me when I first moved from the American West where “everyone is middle class” to the East Coast.
To my amazement I soon encountered a highly structured caste system.  Each stratum of society lived entirely separate from the others even if they existed in close proximity.  For each caste there were clear codes of dress, of speech, of behavior.
Working low status jobs that required uniforms or heavy duty work clothes, I quickly came to understand that white collar types, the perpetually harried and anxious middle classers, would refuse to acknowledge my existence, even trying to walk right through me as if I weren’t there.  Talking to them was out of the question.
Sure enough, when I went out in nicer clothing, I had no trouble getting their attention and talking to them.  I was amazed.

Lower proles often wore black shoes and gray baggy clothes that allowed them to blend into walls and not be seen as they hauled dollies loaded with goods in and out of shops or cleaned up the streets.   These people I saw were the local class of untouchables, ashamed even to be noticed.

There were aristocrats who walked about in elegant earth tones with a satisfied smug expression on their faces.  Just beneath them were their upper middle class followers, whose attempt to imitate their masters’ smile looked more like a petulant sneer.

In the West where I had been raised, athleticism, fitness, and outdoor activity had been counted as virtues.
In the East, the physical was clearly seen as a vice, fit only for proles.
Men prided themselves on being stick thin, emphasizing their gaunt figures with tight clothes.  For women, gentle Yoga in indoor studios, well away from the sun, was the most vigorous activity they permitted themselves.  They seemed to me very like Chinese mandarins who grew their nails long to show beyond all doubt that they never had to perform lowly physical labor.

It was not just the social systems of the East that made me think at once of China and India, but also the sheer density of people.
For the first time in my life, there were endless crowds everywhere I went.  Public restrooms were scarce, the few available, mobbed by hundreds of people and filthy.  Any public resource at all in such an environment was sure to be quickly exhausted in a true tragedy of the commons.  There were few places to sit, even fountains were designed to make it difficult for people to snatch up the coins dropped in them.    The spaces shown as “parks” on the maps were just islands in the middle of intersections, a ring of benches around a statue, most of them occupied by sleeping homeless people.

On reflection, I understood the East coast of the US, unlike the West, had existed for awhile under the rule of England and inherited its customs and institutions.  But mainly, it has simply been there longer.
All available resources and social positions are taken, everyone is caught in competition for an unchanging quantity of scarce resources.

I realized that the Western USA with its relatively informal egalitarian culture is an aberration.  It’s simply too new to have settled into a more normal system.  The West is still a frontier.
Once there’s no more frontier, people have to live together in the same society.
Within a few generations, people assort roughly into classes based on their ability to control wealth and exert power.  Then each class largely breeds with its own until each caste is practically a distinct genetic breed.
Once the process is complete, you have the classic mature social structure that’s indistinguishable from Ancient Egypt or Mesopotamia.

It is important to make this observation because many of humanity’s best accomplishments come from exuberant new cultures over short periods of time, while ancient empires more often plod on for milennia in a senile daze, living on borrowed inertia, unable to adapt or change, with millions of striving laborers, not one of them producing a new idea.

A US Collapse Vs. SU Collapse

The US and SU had many things in common as massive highly nationalistic, highly idealistic, highly militarized nation states founded on pioneering territorial expansion across their continents.

In fact, it was their very alikeness that made them competitors for the same niche!

The author of this piece argues that for all its flaws, the cooperative, state run nature of the Soviet Union made it easier to weather governmental collapse than we’d see in a zero-sum super competitive ultra privatized US that barely 20 years after the SU’s is certainly in sharp decline and possibly on its last legs.

LINK

Brookings Institute Talk on Russia and America

I attended a talk today at the Brookings Institution about the future of Russian-American relations.

Naturally there was considerable focus on current issues such as Syria and Snowden being given asylum, and how it might affect the upcoming G20 summit.

I didn’t wonder about it much, really.  There’s nothing in Syria that’s central to Russian interests and Snowden, while a nasty diplomatic slap in the face, does nothing to change the larger situation.

I was more interested in bigger political and economic developments and where they might be headed.

Interestingly, the experts pretty much all agreed that the present political order in Russia is dependent on Putin’s cult of personality – that without his influence there would be nothing to hold Russia’s oligarchs together.
And – there is no plan for succession should something happen to Putin tomorrow…

They addressed how Putin’s main objective with his anti-American gestures is to boost his popularity at home.   His anti-American posturing has a huge appeal to his base – Russia’s working classes.
The urban middle and upper middle class has little loyalty to Putin, often protesting him in Moscow and St. Petersburg, so it’s only natural Russia’s ruler tailors his image to the vast majority he relies on.

While Syria is, relatively speaking, a sideshow, the fate of former Soviet republics is not.  Since the collapse of the Soviet Union, among Russia’s first concerns is to bring countries like Ukraine closer to Moscow and prevent them from aligning with Western Europe.

If we look at the numbers, though, it seems to me Russia’s agenda is doomed to fail.

Russia’s entire economy is worth 1.8 trillion.  This is enough to make it one of the world’s bigger economies, but to put Russia’s imperial goals in perspective, Italy’s economy is considerably bigger at 2.2 trillion with 1/3rd the population.

Let’s pretend we are Ukraine for a moment:

Which would we align with:  A 1.8 trillion Russia or a 17 trillion European Union?!

Not to mention, Russia’s economy to this day is based heavily on commodities like natural gas rather than skills or tech.
Indeed, one subject to arise during the question and answer session with the experts was brain drain from Russia…

With no Soviet Union any more that can keep their best talent captive, skilled Russians are increasingly ditching their home country for places like Silicon Valley.  And Russia itself with its feudal oligarchs and powerful crime lords tends to be very unfriendly to commerce.
So long as Russian small businessmen are parasitized by protection rackets and foreign investors are confronted with corruption, their economy is not likely to become truly “modern” any time soon.

A main theme of the talk was to ask what Putin really wants and how to get Russia to work more closely with US objectives.  Even the experts seemed to regard Putin as a mystic, inscrutable, Eastern Czar.
If we look at the numbers, though, it seems clear why the US can’t seem to get Russia to budge.

Relatively speaking, the US really is not that important to Russian interests so it simply doesn’t have that much leverage.
The vast majority of Russia’s foreign trade is with the European Union and with China in a distant second place.   Commerce with the US takes a comparatively puny 4th or 5th place with just a few percent of the total.  Also, the US is just about on the other side of the planet from Russia’s major cities while China and Europe are much more immediate neighbors.
It really shouldn’t come as a surprise that US requests take a back seat compared to more immediate concerns.  What decisive advantage does America offer in exchange for Putin’s cooperation?  Putin is a pragmatist, so clearly what he’s being offered isn’t worth as much as he gets from slighting the US to boost his domestic approval ratings.

The economic reality on the ground is that Russia is already just a big commodity provider for the EU, and thus in every meaningful sense, already part of Europe.
If we look at the facts, Russia as a modern great power, is pure fantasy.

During the talk, there was mention of a new, more Western generation of Russians just waiting for the older oligarchs to die off.  Such a generation is bound to reconcile Russia’s political reality with the economic reality.
Instead of trying to keep states like Ukraine from being sucked into Europe, Russia will itself be sucked into the Euro zone.

Even if Russia somehow remains an aloof oligarchic kleptocracy, it will still be useful for its resources as a lesser partner of Europe.

Graph Russia Trade Partners

IQ Isn’t A Great Predictor Of Presidential Success

IQ is still only a so-so predictor of success for a President, it doesn’t judge a President’s learning method, ability to rigorously fact check sources, fortitude, mental flexibility, leadership, teambuilding skills, bureaucratic support, ect…:

http://www1.csbsju.edu/uspp/Election/bush011401.htm
In terms of brute brainpower, the smartest postwar presidents were Richard Nixon, a Duke Law School graduate with a reported IQ of 143; Jimmy Carter, who graduated in the top 10 percent of his Naval Academy class; and Rhodes scholar Bill Clinton, a graduate of Georgetown University and Yale Law School. Deeply flawed presidencies all, despite their potential.

In contrast, take high school graduate Harry Truman — railroad worker, clerk, bookkeeper, farmer, road inspector and small-town postmaster — or Ronald Reagan, sports announcer and B-list actor with mediocre college credentials.

Despite their intellectual limitations, both achieved substantial political success as president. And, to press home the point, there is Franklin D. Roosevelt, a top-tier president in rankings of historical greatness, whom the late Supreme Court justice Oliver Wendell Holmes branded “a second-rate intellect but a first-class temperament.”

Will Hyperinflationary Depression Hit the USA before 2015?

Many economists predict that the US dollar will lose its current reserve currency status.  Some economists believe this will happen around 2030;  John Williams of Shadowstats believes it will happen no later than 2014.

[A] hyperinflationary great depression…  will encompass a complete loss in the purchasing power of the U.S. dollar; a collapse in the normal stream of U.S. commercial and economic activity; a collapse in the U.S. financial system, as we know it; and a likely realignment of the U.S. political environment. Outside timing on the hyperinflation remains 2014, but events of the last year have accelerated the movement towards this ultimate dollar catastrophe. …

[B]efore the systemic-solvency crisis began to unfold in 2007, the U.S. government already had condemned the U.S. dollar to a hyperinflationary grave by taking on debt and obligations that never could be covered …

Bankrupt sovereign states most commonly use the currency printing press as a solution to not having enough money to cover obligations. The alternative here would be for the U.S. eventually to renege on its existing debt and obligations …
a solution with no happier ending than simply printing the needed money.


Where both private and official demand for U.S. Treasuries had been increasingly unenthusiastic, the Fed—the U.S. central bank—effectively has been fully funded Treasury needs for most of 2011, with its “quantitative easing II” becoming a euphemism for Fed monetization of U.S. Treasury debt.

Further easing by the Fed is likely in the months ahead, as the ongoing economic turmoil triggers significant further fiscal deterioration. Those actions should pummel heavily the U.S. dollar‘s exchange rate against other major currencies. Looming with uncertain timing is a panicked dollar dumping and dumping of dollar-denominated paper assets, which remains the most likely event as proximal trigger for the onset of hyperinflation in the near-term.

The early stages of the hyperinflation would be marked simply by an accelerating upturn in consumer prices, a pattern that already was initially in response to QE2. Also, money supply velocity … will spike, as the U.S. dollar, again, comes under heavy and even disorderly selling pressure, with both domestic and foreign holders getting rid of their dollar holdings as quickly as possible. One factor that can contribute to rising velocity is the current circumstance where U.S. investors cannot get a safe return that beats inflation, as reported by the government. Investors can do better by buying a store of products that are rising price, rather than by holding cash or a Treasury bill.

Given the current lack of political will by those controlling the U.S. Government to address the fiscal solvency issues, the U.S. has no way of avoiding a financial Armageddon. Various government intervention tactics might slow the process for brief periods, and the system always is vulnerable to external shocks, such as wars and natural disasters. Government actions could include supportive dollar intervention, restrictions on international capital flows, wage and price controls, etc. Effects of any such moves in delaying the onset of full hyperinflation, though, would be limited and short-lived. There is no obvious course of action or external force at this point of the process that meaningfully would put off the nearing day of reckoning.

[F]oreign holders of U.S. assets have something in excess of $12 trillion in liquid, dollar-denominated assets that could be dumped at will into the global and U.S. markets.

As excess dollars get dumped into the global markets, a shift in the tide against the U.S. dollar gets reflected in a weakening exchange rate, which in turn spikes dollar-denominated commodity prices, such as oil. Increasingly, that effect has been in response to intensifying dollar-debasement efforts by the Fed. The result is that U.S. consumer inflation has been increasing during the last year, once again, not from strong economic demand and a surging domestic money supply, but from distended monetary policies and a global glut of dollars that has been encouraged by the U.S. central bank.

Demand and supply affect the U.S. dollar. Supply soars and demand shrinks with the increasing unwillingness of major dollar holders to continue holding the existing volume of U.S. currency and dollar-denominated assets, let alone to absorb new exposure.

Therein lies a significant threat to near-term U.S. inflation. Heavy dumping of the U.S. dollar and dollar-denominated assets would be highly inflationary to U.S. consumer prices. It also likely would activate heavy Fed intervention in buying unwanted U.S. Treasuries.

How long would a hyperinflation last before the government brought its fiscal house into order and established a sound currency? I would be surprised if the hyperinflation crisis lasted beyond a year or two, since the system is not positioned to handle the crisis well and pressures for rapid resolution would be extremely strong. All that depends, however, on what evolves out of what otherwise would be highly unstable political, economic, financial and social environments.

-Taken from
HYPERINFLATION 2012 SPECIAL COMMENTARY NUMBER 414 January 25, 2012
http://www.shadowstats.com

Scenarios:

Scenario 1 – Moderates Rule:
Panic begins in 2013; hyperinflation runs wild in 2014 and radical political changes occur in 2015. Congress retains legitimacy but puts many bankers in prison for their white-collar crimes.  The Supreme Court issues many multi-page documents that no one can afford to print out. Electricity is for the ultra-rich and the police. Meanwhile, the former middle class learns how to dumpster-dive for food.  Jeb Bush is elected President in 2016, with Henry Kissinger serving as his chief advisor.  Despite grave health problems and widespread hunger, the majority of Americans believe that obedience to government is the best of all possible lifestyles.

Scenario 2 – Unpopular Election Leads to Stable Martial Law:
Panic begins in 2012 with widespread allegations of vote fraud; hyperinflation runs wild in 2013, leading to a breakdown of food distribution, martial law, and civil war.  Following a violent dispute between armed agents of the DHS and FBI, Lon Horiuchi is sworn in as President-for-Life.  Alex Jones is heard to shout “I told you so” as he is dragged onto a cattle car headed for a FEMA camp. Meanwhile, mandatory military service ensures that the enduring encampments will be heavily manned, everywhere from Afghanistan to Zimbabwe.  Monsanto takes over the Department of Agriculture and summarily executes all organic farmers.  Social Security and Medicare are re-negotiated to stipulate that Inner Party members have first claim on all benefits and services, but all classes are required to pay on penalty of death.  Hollywood puts out a record number of movies, webcasts, and TV shows, all of which glorify obedience to the Totalitarian State.  Robot drones fly everywhere; every room has a surveillance camera; every action a citizen takes is a potential ground for disciplinary action by the all-encompassing State.

Scenario 3 – Total Disintegration:
Excellent propaganda efforts allow complacency to prevail until December 2014.  By January 2015, every country outside the USA is dumping dollars.  A few canny merchants manage to sell off prestigious US weapons systems to ambitious upstarts.  Military desertions are frequent; morale is at its lowest ebb. The ultra-rich flee to distant locations such as the Cayman Islands, Hong Kong, Israel, and Tahiti. Beverly Hills is sold off to nouveau-riches; all Hollywood movie studios shift operations overseas.  Canada is swamped with American refugees pleading for political asylum. The United Nations shifts its meetings from New York City to Sao Paulo for safety reasons.

Numerous factions within the military and government vie for supremacy;  CNN celebrates prominent generals as war heroes on Monday, but the same generals are hanged as traitors by Friday.  Popular discontent grows as commercial food stores go out of business and government hand-outs of food are often moldy and unfit for human consumption.  There are wild contrasts in standard of living; the rich walk warily on the same streets as the poor and hungry. Free speech zones are reserved for rich young students who can be relied on to protest only what the government already dislikes.  Pain rays, attack dogs, and tear gas silence unarmed protestors, but fail to impress street gangs funded by illegal drugs and armed with illegal guns.

Some Black and Hispanic street gangs  end up fighting each other to extinction, but most of them concentrate their efforts on terrorizing whites and Asians in an effort to extract tribute.   Armed robbers who had previously conducted home invasions in the cities begin raiding farms.  Farmers use modern technology such as cheap surveillance cameras and wireless networks to coordinate violent vigilante actions.

The prison-industrial complex is attacked by homegrown terrorists, leading to a massive expansion of military security outside prisons.  20% of the USA population is either incarcerated or branded as a felons.  Felons paroled from the prison system are given the choice between summary execution and indefinite detention in a FEMA-run labor community.  Prisoners provide ultra-cheap labor and the prison system is a pillar of the economy.

About 5% of the USA population holds a secret or top-secret security clearance.  Such clearances are required to work in the armaments industry and to hold public office.  Many young people strive to obtain such clearance, but rapidly become disaffected; many security clearance holders are subjected to “stop-loss” regulations that prevent them from leaving their jobs.  Censorship becomes the prevalent consideration in all USA media; clearance holders live in constant fear of blackmail, formal charges of treason, or brutal-but-unofficial disciplinary action.

Internet infrastructure degrades because copper telecom cables are stolen and sold to unscrupulous profiteers.  White radicals find receptive audiences.  Civilian combat shooting becomes widely reported, but police and prosecutors are not able to investigate most incidents to determine whether they were self-defense.

The USA government retreats to its Deep Underground Military Bases, and is able to retain control of its satellite network in order to continue issuing orders to troops overseas.  However, the military is hollowed out by desertion.  The USA retains many military capabilities but loses its diplomatic prestige.  The IRS escalates its levels of violence and shoots many tax protesters dead.  The Department of the Treasury proposes a cashless currency system but lacks the resources to implement it. Meanwhile,  the Federal Reserve Note only has value on military bases; barter reigns everywhere else.

California is taken over by narcoterrorists; the USA promptly bombs California’s cities with daisy-cutters and depleted uranium.  Plagues and packs of wild dogs become prevalent because there are too many dead bodies and no one is willing to bury them.  Cults and drug use become prevalent (in areas outside USA military control) because many Americans have no Internet access and are desperate for escapism.  However, drug-centered tribes and religious cults fail to accumulate any political power, because the prominent ones are soon exterminated by raids from the DHS.

Washington and Oregon, overwhelmed with Californian refugees, lapse into chaos.  United Nations peacekeepers attempt to suppress gang war.   Montana, Idaho, North Dakota, and South Dakota form the Northern Conference, maintain good relations with the remnants of the USA military, and refuse to admit United Nations peacekeepers.  The Northern Conference grudgingly does business with China over the Canadian border. Southern Texas is a warzone; Northern Texas pleads for international food aid but refuses United Nations involvement. The United Kingdom attempts to send SAS units to rescue a British diplomat captured in Florida, but the entire mission is foiled by heavily armed Hispanic gangs.

By 2025, the USA closes its bases in Japan, Korea, Germany, Iraq, and Afghanistan.  Other bases, such as Guam and Saudi Arabia, remain open.  At the United Nations Building in Sao Paulo, Russia, China, India, and Brazil announce their commitment to BATO, the Benevolent Alliance Treaty Organization, which will absorb the United Nations Security Council in order to send peacekeepers to protect the starving civilians in war-torn places such as Louisiana, Oregon, and Texas.

Scenario 4 – Military Mutinies:

By 2015, USA warfighters (including sailors, marines, airmen, and soldiers) are widely aware that their pay is nearly worthless.  Rather than obeying orders and upholding standard military decorum, warfighters engage in mass disobedience.  They make public political statements in uniform.  They denounce their superior officers as traitors.  They clog the military justice system with legal protests.  They circulate underground “newspapers” of radical dissent.  Those who can take early retirement re-enter civilian life as anti-statist radicals.  Smedley Butler’s “War is a Racket” becomes the most-quoted essay of 2015.

At home, some DHS and police personnel are inspired by these mutineers, but others are indignant.  Following many nonlethal shows of force and many riots, the police recognize that the general citizenry loves warfighters much more than they love cops.  A few police resign in disgrace.  Many warfighters run for local political office on an anti-statist campaign.

Ron Paul is too old to run for office, but becomes a major influence on many young office-holders.  The USA undertakes peaceful means to alter its own government and to abolish many of its government agencies.

Visualizing The U.S. Electric Grid

The U.S. electric grid is a complex network of independently owned and operated power plants and transmission lines. Aging infrastructure, combined with a rise in domestic electricity consumption, has forced experts to critically examine the status and health of the nation’s electrical systems. Link

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