• Solutions: Do You Have More Confidence in Yourself or Your Government?

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    by Simon Black: What
    Are the Social Implications of Economic Collapse?



    Over the last
    days, I’ve endeavored to explain why the economic reversal
    of fortune in the west is unstoppable… and what the social
    implications of this decline will be.

    Economic decay
    and social upheaval are inextricably linked. This is not some doom
    and gloom conjecture, but rather simple historical reality: when
    you take away people’s livelihoods and their abilities to put
    food on the table for their families, turmoil reigns.

    Consider Argentina
    during its millennium economic crisis… Zimbabwe during its
    hyperinflationary period… Japan during its lost 2-decades…
    Germany in the interwar period… Rome during the reign of Tiberius…
    Russia after the fall of communism…

    There is a
    common element in each of these examples – even just a few
    years before the economic turmoil began, nobody would have expected

    If you had
    told an Argentine in the mid 1990s that he would be digging for
    food out of a trash dumpster in a few years, he would have been
    insulted. If you had told a Japanese businessman in 1984 that he
    would spend the next decades floundering in stagnation, he would
    have thought you were crazy.

    What would
    you have said in 1995 if someone told you that government agents
    would fondle children at airports while stagflation takes over the
    economy and the government borrows money just to pay interest on
    the money it has already borrowed?

    balance sheet is deteriorating by the hour, and lenders will require
    a higher return to compensate them for this additional risk. Consequently,
    government borrowing costs will rise, making the situation even
    more precarious.

    The increased
    interest expense will cause them to borrow even more money and go
    deeper into debt until one of two things happens: either the Federal
    Reserve debases the currency to its intrinsic value, or the US government

    Either case
    is catastrophic. If the US defaults on its debt, it would set off
    a chain reaction of derivatives that would bankrupt the entire financial
    system. If the Fed debases the currency, Americans will be left
    holding worthless dollars that can’t even be used as toilet

    you can expect the government to declare war on its citizens, raising
    taxes to feudal serf levels in order to pay for their largess, and
    imposing police state conditions to keep everyone in check.

    So – what
    is one to do about this? There are a few options.

    1) Do nothing.
    You can always stick your head in the sand and have faith that your
    ‘leaders’ are going to work out the problems, because,
    hey, collapse could never happen here… right? This option obviously
    worked out well for the Argentines, the Japanese, the Germans, the
    Romans, etc. who thought the same thing.

    2) “Stay
    and fight”. This is a nonsense solution. There is no enemy
    to fight… these issues were not caused by a single person but
    by the very institution of government. People who talk about political
    solutions have no understanding of the problems – try getting
    155 people to agree on specifics. Now try 155 million.

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