Imagine government officials in the US establishing a policy of treating dogs with the inhumanity detailed in White House "torture" memos? There would be marches in the streets for the dogs, but discussions at today’s water coolers hold no mention of the beatings, sensory deprivation, or stress positions encountered by those snared in the War on Terror’s drift nets and held captive by US military personnel in Cuba or Iraq.
This evolving acceptance of double standards is inevitably leaking back into the domestic lives of US citizens. The tenor of moral standards is moving toward the complete utilitarian justification of force. As our top elected officials have said, "All options are on the table." This sort of thinking is already operational in the Drug War, where the absurd notion of imprisoning persons for their own good has enjoyed decades of popular support.
The rot in Western Civilization (especially in the USA) is clear whether one examines the foregoing political/moral facet or conditions in the economic sphere. Manufacturing has declined in the US in favor of service provision, with weapons production becoming one of the last remaining bastions of power in the former and financial machinations the dominant element of the latter.
For years we’ve had a massive growth in credit creation by the Federal Reserve System, which financed and magnified a mountainous expansion of asset values and an increasingly obsidian array of structured asset products like Collateralized Debt Obligations and Credit Default Swaps. As evaluating the real worth of paper assets became ever more difficult, clarity of focus in investment gave way to a utilitarian version where "it’s worth whatever someone (a greater fool) will pay for it."
Value clarity, like moral clarity, is entirely relative. Traditional standards now apply in neither the political/moral sphere nor the economic/financial sphere.
The fact that these trends have been operating for years and decades is especially difficult, as it appears that such trends that should have reached aphelion long ago simply continue without boundary. When a seemingly unsustainable trend continues day after day, week after week, it’s easy to give into despair.
My favorite analogy for this pyramid of credit creation, debt origination, and risk assumption is the game Jenga. The cycle goes like this: New debt is collateralized by rising asset values whose very increase in value occurs because of demand created by the creation of credit turned into the assumption of new debt. This is like taking blocks from the body of a Jenga tower and placing them on top of the stack. Each new layer increases the risk of upset.
As we know, eventually the underlying structure of the Jenga stack is so weakened that the tiniest imbalance sends it toppling into total collapse. This analogy should hold for financial systems Americans assume to be permanent. This portends a period of great difficulty and relative chaos lies ahead. Navigating it will be a central challenge for every individual in coming years.
Eventually the consensus will reverse from the current self-destructive trend. Hard lessons are re-taught during difficult times. When all the empty promises of the political class have been laid bare, and the consequences of a morality of naked force are visited upon those previously indifferent to the plight of others, then should the tenor of our society reacquire the pillars of a stronger and more ordered community.
It may take a long time, but this sojourn into de-civilization, too, will end. It will end because people who hold to standards and recognize moral clarity teach others by example and naturally eschew force. It’s the only thing we can do, even if we become small islands in the coming maelstrom.
March 5, 2007