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Why America Fell So Far … So Fast
Thomas Edison said, “Dissent is the highest form of patriotism.” And because I love my country, I frequently criticize America’s shortcomings in the hopes of making her better.
But the truth is that the United States is not unusual … it is just like all other empires which have hit their peak and then quickly crashed.
We noted in 2008:
Political insider and veteran reporter Kevin Phillips has documented that every major empire over the past several hundred years has undergone a predictable cycle of collapse, usually within 10 to 20 years of its peak power.
The indications are always the same:
- The financialization of the economy, moving from manufacturing to speculation;
- Very high levels of debt;
- Extreme economic inequality;
– And costly military overreaching.
We wrote in 2009:
In 2000, America was described as the sole remaining superpower – or even the world’s “hyperpower”. Now we’re in real trouble (at the very least, you have to admit that we’re losing power and wealth in comparison with China).
How did it happen so fast?
***
How Empires Fall
Paul Farrel provides a bigger-picture analysis, quoting Jared Diamond and Marc Faber.
Diamond’s book’s, Collapse: How Societies Choose to Fail or Succeed, studies the collapse of civilizations throughout history, and finds:
Civilizations share a sharp curve of decline. Indeed, a society’s demise may begin only a decade or two after it reaches its peak population, wealth and power…
One of the choices has depended on the courage to practice long-term thinking, and to make bold, courageous, anticipatory decisions at a time when problems have become perceptible but before they reach crisis proportions
And PhD economist Faber states:
How [am I] so sure about this final collapse?
Of all the questions I have about the future, this is the easiest one to answer. Once a society becomes successful it becomes arrogant, righteous, overconfident, corrupt, and decadent … overspends … costly wars … wealth inequity and social tensions increase; and society enters a secular decline.
[Quoting 18th century Scottish historian Alexander Fraser Tytler:] The average life span of the world’s greatest civilizations has been 200 years progressing from “bondage to spiritual faith … to great courage … to liberty … to abundance … to selfishness … to complacency … to apathy … to dependence and … back into bondage”
[Where is America in the cycle?] It is most unlikely that Western societies, and especially the U.S., will be an exception to this typical “society cycle.” … The U.S. is somewhere between the phase where it moves “from complacency to apathy” and “from apathy to dependence.”
In other words, America’s rapid fall is not really that novel after all.
How Consumers, Politicians and Wall Street All Contributed to the Fall
On the individual level, people became “fat and happy”, the abundance led to selfishness (“greed is good”), and then complacency, and then apathy.
Indeed, if you think back about tv and radio ads over the last couple of decades, you can trace the tone of voice of the characters from Gordon Gecko-like, to complacent, to apathetic and know-nothing.
On the political level, there was no courage in the White House or Congress “to practice long-term thinking, and to make bold, courageous, anticipatory decisions”. Of course, the bucket-loads of donations from Wall Street didn’t hurt, but there was also a religion of deregulation promoted by Greenspan, Rubin, Gensler and others which preached that the economy was self-stabilizing and self-sustaining. This type of false ideology only can spread during times of abundance and complacency, when an empire is at its peak and people can fool themselves into thinking “the empire has always been prosperous, we’ve solved all of the problems, and we will always prosper” (incidentally, this type of false thinking was also common in the 1920′s, when government and financial leaders said that the “modern banking system” – overseen by the Federal Reserve – had destroyed instability once and for all).
And as for Wall Street, the best possible time to pillage is when your victim is at the peak of wealth. With America in a huge bubble phase of wealth and power, the Wall Street looters sucked out vast sums through fraudulent subprime loans, derivatives and securitization schemes, Ponzi schemes and high frequency trading and dark pools and all of the rest.
Like the mugger who waits until his victim has made a withdrawal from the ATM, the white collar criminals pounced when America’s economy was booming (at least on paper).
Given that the people were in a contented stupor of consumption, and the politicians were flush with cash and feel-good platitudes, the job of the criminals became easier.
A study of the crash of the Roman – or almost any other – empire would show something very similar.
We pointed out in 2010 that more empires have fallen due to reckless finance than invasion. (Whichever side of the stimulus-austerity debate you agree with, spending walls of money on things which neither help people or stimulate the economy is idiotic.)
Inequality was – indeed – one of the main reasons for the fall of the Roman Empire … and inequality in America is much worse than in Ancient Rome. In fact, inequality in America today is twice as bad as in ancient Rome , worse than it was in in Tsarist Russia, Gilded Age America, modern Egypt, Tunisia or Yemen, many banana republics in Latin America, and worse than experienced by slaves in 1774 colonial America.
Finacialization? Yup, we’ve got that in spades … Economist Steve Keen has also shown that “a sustainable level of bank profits appears to be about 1% of GDP”, and that higher bank profits leads to a ponzi economy and a depression). But government policy has been encouraging the growth of the financial sector for decades:
Corruption? Check … the government and big banks are all wallowing in a pig sty of criminal fraud. The economy has been hollowed out due to looting and fraud. And our institutions are so corrupt that people have lost faith in the economy. They are so corrupt and oppressive that people are more afraid of the government than of terrorists.
The bigger the bubble, the bigger crash … and we’ve just come out of the biggest bubble in history.
Costly military overreaching? Definitely…
The war in Iraq – which will end up costing between $5 and $6 trillion dollars – was launched based upon false justifications. Indeed, the government apparently planned both the Afghanistan war (see this and this) and the Iraq war before 9/11.
It is ironic that our military is what made us a superpower, but our huge military is bankrupting us … thus destroying our status as an empire.
Empires which fight “one too many wars” always collapse:
“Just one more surge!” — The Indus
“Just one more surge!” — The Kushan
“Just one more surge!” — The Scythians
“Just one more surge!” — The Parthians
“Just one more surge!” — The Saffarid
“Just one more surge!” — The Ghaznavid
“Just one more surge!” — The Ghorid
“Just one more surge!” — The Timurid
“Just one more surge!” — The Hotaki
“Just one more surge!” — The Durrani
“Just one more surge!” — The Aryan
“Just one more surge!” — The Persians
“Just one more surge!” — The Sassanids
“Just one more surge!” — The Hephthalites
“Just one more surge!” — The Huns
“Just one more surge!” — The Mughals
“Just one more surge!” — The Arabs
“Just one more surge!” — The Turkic
“Just one more surge!” — The Hazaras
“Just one more surge!” — The Khwarezmids
“Just one more surge!” — The Mongols
“Just one more surge!” — The British
“Just one more surge!” — The British (again)
“Just one more surge!” — The British (Yet again)
“Just one more surge!” — The USSR
“Just one more surge!” — The United States
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Bravo Joseph for your philosophical appel, it is entirely valid.
"There is no absolute truth" could well be the most poignant oxymoron there is, this I agree.
Let's call it an axiom then. But on what basis you may ask can we call it an axiom particularly if you are convinced in your gods existence. I concede then we've reached a dead end.
It is worth exploring though why humans have an insatiable desire for an "absolute" moral code.
Stop and ask yourself, why. Why do need such a thing. Why can't we be content that diversity underpins life, diversity underpins the individual, diversity underpins consiousness and thought. Why do we desperately need an absolute. I'd propose that it is because we are still infants. Just like children that need a strict routine in order to fucnction I think we as humans are still very insecure. We need a strcit set of rules handed to us by a father figure, an authority just like a child receives from an adult.
Fascinating really.
Any time anybody brings up the concept of morals, you cannot escape the question of who gives those moral statements. Where do they originate? If there is no moral-giver, there are no morals. There is no such thing as 'right' and 'wrong' and we cannot complain here on zero hedge that the banksters and the fed are doing 'wrong'.
Wipe out humans from this world and let the rest of the planet life in peace
Start with yourself.
bringon, you seem to know the heart of pro lifers, you never speak of the heart of pro deathers...perhaps you should
You're complicating the issue. The heart of a pro-deather that you speak of is a meaningless tangent to the dconversation. Sometimes, maybe often times, there is an unwanted pregnancy. END OF STORY. The conceived embryo is not wanted by the mother of father. It is not up to me or you or anyone else to impose their views on that mother because she is the one who will be stuck raising the baby. I can understand from a purely emotional perspective that you find it hard to grasp but that's because you are not the one stuck with the consequences. A species of sea bird (a puffin I think) hatches two chicks. The stronger of the two chicks pushes the weakest one out from under the parent where it dehydrates or is predated on only inches from the mother. Life is one tough mother fucker my friend and emotions do make it difficult for us in our journey through life. Maybe it's the price we must pay for a so called higher intelligence.
America in decline is pre planned and a simple example for it- Jon corzine and MF global. Crimesat the highest levels with no justice- the FRN a fake promise loved by so many, a society of libertines..fascism centralized power with no one brought to account..how can it end except in ash and sorrow.
Since no one else has stepped in to take up your sadsack soundtrack of sionist lies\distortions&disinfo...
I will address your problem now.
Baby killers... spell it out for us telaviv trollboy...
and then I will give you the personal attention that you be longin for.
Please!
The time-honored mark of the ZH implanted sio-troll...
provocate... implicate... obfuscate...
but when directed to put up or shut up... any other recourse than the vote button cannot be found!
Debate finished... only talmudist genodical racial-supremacists resort to 'baby-killin.' You lose.
Ahhh. The conformist speaks.
I must have hit a little close to home, eh?
What about baby killing?
You sir, are a posterboy for contraception.
Book: "Collapse: How Societies Choose to Fail or Succeed"
My answer to the book's title and main question: societies collapse when the people choose to tolerate a thieving, murderous, criminal government.
"History does not repeat, government does." hujel
America: The first great empire to go from barbarism to decadence with no high culture in between.
Obama gets high all the time.
The demise of the USA began when the US oligarchy embraced Leon Trotsky et al and the ideologues of the Bolshevik revolution of 1917 for its chosen ideologies for Wall Street and its leading Universities. Today, the Headquarters of global Trotskyism is the USA which has allowed itself to be manipulated by those same Bolshevik forces that terminated the Russian Empire and created the Soviet Union with the murder of ~50 million people or more (nobody knows).
Viewing the US from the outside, it would appear most probable that the USA will fall in much the same way as the Russian Empire and by the same ideological forces. But then, maybe it isn't an ideology but more of a diseased parasite?
Ho hum
There is a lovely powerpoint from a russian showing increasing correlation between 1989 soviet collapse and america 2020.
Yes, Dmitry Orlov's "Reinventing Collapse" is an excellent read.
Being excluded from the prosperity brought by an empire does not mean the empire collapsing.
There is no collapse. Only 'americanism' unfolding as the momentum given on 1776, July, 4th.
But the 'american' entitlement mindset is beyond ken: 'americans' figure themselves part of the 'american' middle class through generations.
US 'american' broccoli furiously titrating passionate galactic pultritude, yearning to monolize seven zodiacal crustaceans, chiral denialistic naiads forced to extort the weakness of the middle class inclined pimple.
Is this not citizenism in a new guise?
akak asked:
Your hammering of the point is squarely to the nailhead pounded.
Does not the sun also rise?
But the 'AnAnonymist' disfigurement mindset is beyond Ken and Barbie: Chinese citizenism citizens disfigure themselves part of the 'AnAnonymist' doll-playing class through propagandurbations.
The zodiacal crustaceanity is undeniably bivalvular. It would be an embarassment of club-footed proportions, save that 'AnAnonymists' have no shame.
As a former engage in the merchandisation of top quality, top-iced n ready to BBQ 5\10\day USA-grown, made in merika Broccoli(n all the other delicious n nutritious members of the 'vegetable kingdom')...
I resent yur (probable)aspargus-hatin aspersions towards our veggie brothers..and recommend that yu stick to floating pigs...'domestic deer' ...improbable lamb, n such in the future...
to avoid being lumped together with certain faux Texan NewEnglanders with pressing dietary and synaptic issues! Come sus legumbres pardner!
The statement that our military made us an empire is pitiful ignorance. Our industrial productivity, protected by tariff walls, and an utterly sound currency, made us a world superpower. The military was an afterthought. Un-fortunately they have now, in the declining stages of the culture and the nation, found rationales to subvert too many congress criturs and absorb an absurd amount of productivity.
Maybe it helped that the only country with significant manufacturing capabilities at the end of World War II was the US. Viewed that way the US military did make an empire.
The interstate highways were mean't to move the military machines not convertables and Harleys
The instant England swallowed the no tariff kool aide she lost the title of number one manufacturer to the tariff protected USA.
But hey, whatever. History and truth are irrelevant to the snakes and ticks running the show. The explosive impact of the USA into the ground will be visible from Mars.
Now lets buckle down and get those 13 million, or 33 million once they bring in family members, legalized.
Then we can work in the next amnesty. I hear importing Somalis is really working out; there's no reason we cannot import 5 million 3rd world Muslims and I, for one, endorse this proposal.
FORWARD!
What happened to 'Hope' and 'Change'? Well, maybe we can go 'Forward' huh? /sarc
I think Wall Street screwed the pooch and they haven't figured out yet that it's impossible to 'unscrew' that poor pooch. And we are the ones that have to pay.
It's like a giant German Shepherd screwing a Chihuahua...... (and we're the Chihuahua) They're stuck in there, screwing away, stuck and unable to pull out. Common sense would say throw some cold water on them - that'll usually 'deflate' the big male...
Throwing cold water on them didn't work? Oh wait.... nobody tried THAT?!?!?.............. instead we've been feeding Wall Street more Viagra (measured in trillions)
Just remember what happens with an erection lasting longer than 4 hours.... necrosis sets in because, even though fully engorged, the tissue isn't getting enough fresh blood to stay alive. Maybe that's the problem.... Wall Street's brain is already dying.
http://www.youtube.com/watch?v=izgAhAcbsUY
What is going to crash America? Simple: It is the greed of the elites and their handservents in the government.
I would like to see someone compare the demise of the west with the evolution of porn.
Or the evolution of Oxycontin.
porn hasn't evolved. It's been the same for thousands of years.
I was thinking along the line of womens bodies from HH playboy girls of the 50 to todays buffed up, silicon injected, shaved girls and the easy access of all that stuff. Remember when girls had bush?
Regardless your definition of "Empire," the USA certainly falls somewhere in the midst of Was One, Is One, and Wanted to Be.
Regarding the rapid fall, GW, that is the natural event that takes place when a critical mass of places of influence and control are infested by the Narcissist.
It's nothing more than the Corner to which the Narcissist leads, having destroyed all methods of escape along the way.
The unaware enabling the whole show...
Nothing is different this time, except the unaware get to watch and bitch in real time, as it crumbles.
So much for technology, so much for communication -- We still don't get it.
All in full display, this time.
At least we'll have friends in low places. Japan, France, Italy, Spain, Portugal, Greece, Ireland, the UK, Belgium...
Dude,
Only two issues matter:
1) The 'socialized' losses will soon overtake the 'privatized' gains.
BECAUSE
2) That's how the exponential function WORKS
Hubris , then MATH end ALL EMPIRES...!!
"Socialism is fine, until you run out of other peoples money to spend"/ Margaret Thatcher. Good to remember.
I think quotes from 'leaders' who did more to destroy Britains' economy than help Britain are simply awesome.
I don't think you understand how the socialization of private losses works. How about we let all private banks/corporations fucking fail instead of robbing the fucking taxpayer to bail them out? Why not have the owners, management, and shareholders pay back the fucking creditor instead motherfucker? This isn't socilism, this is crony-capitalism/fascism you ignorant fuck.
Wall Street is the Nomenklatura of the US.
The reason Communism collapsed in Russia (and for all practical purposes in China) is that the Communist leaders realized they could become a LOT richer under capitalism and ther odds of mobs chasing them down and stringing them up in the streets decreased to near zero. Ceausescu in Romania would still be alive (and even wealthier) if he'd realized this.
Communism was just as much about those at the top exploiting the workers' as Capitalism. It was just far less honest about its intentions. Saying 'we're going to help you!' and then shitting on people only pisses them off. Workers that supported Communism thoguht things would improve but for most, they got worse. Workers under Capitalism expected things to get worse - but for most they got better. Things start to hit the fan - revolutions and riots occur - when people lose hope. The question is: "How much 'hope' is left for the workers now under the current 'crony Capitalist' system?
Could someone point this out to Kim Jong Un? Quickly?
Shift+P; we can't run out of money! PARTY ON!
just one more surge!
Eventually the lawyers, accountants, politicians and other nonproducers take to much for a society to continue to actually produce anything.
The irony of it is that if you cut the spending, investment ceases, and the war stocks go belly-up, and in an economy this addicted to massive weapon production runs to hold stock prices aloft, if you want growth, you're going to have to spend more on weapons, that you don't even need.
the problem with cutting .gov spending is the money saved never reaches the private sector because of the deficit. normally, when you take a trillion from .gov and give it to the private sector there is a wash(except that the money spent in th eprivate sector will be more efficiently spent, market driven instead of .gov driven). the economy does not suffer in aggregate. obviously there will be some redistribution out of .gov contractors and the communities that depend upon them but the effect is harmless to the aggregate measure of economic activity. but, cutting .gov spending in a deficit environment only reduces the deficit(the bond market) plus harming all the .gov contractors and the communities that have grown dependent upon .gov. because there is no actual return of the money to the private sector.
that is an unintended consequence of keynesian fiat printappolooza.
Wrong: Proof that War Is Bad for the Economy
um dude, don't know what made you think I was saying war is good for an economy.
All I said was the US is in a trap that it can now not get out of without a massive collapse in stocks if it even tries deep cuts in spending on new weapons (that it doesn't even need). Read it again, I've made this point before. Feel free to point out how it's wrong though. You may want cuts, who doesn't, all I'm saying is don't get your heart set on it, ultimately they aren't coming without a major collapse as well. Though they may need to cultivate and contrive some wars, or rumors of wars, to cover up that they dare not make any concerted deep cuts, due to the risks for so many stocks. That if they do swing the axe, this could bring the whole equities house of cards down (as well as numerous banks of course ... and we can't have that).
This problem is a result of the consistent efforts by the Fed to manipulate and avoid healthy corrections in malinvestment over the years just like when the gov't "protects" the forests to prevent any fires from occurring. All this "protection" just makes for a more dangerous environment with more stuff to burn. Now, that nothing is allowed to falter, fund managers make irresponsible bets on things and over-investment just piles up waiting for a flicker of a problem. So now, nothing can be allowed to show signs of sparking for fear the entire ecosystem will be destroyed. That's the fault of the Fed and their irresponsible mismanagement of our money and monetary policy.
If they want to protect the equities markets, why not add rules and restrictions that penalize flash trading? Why don't they tax your gains based on your length of investment? There are a million other things these corrupt assholes can do other than devalue the people's currency to manipulate the markets that really only serve the wealthiest people. They don't even have a fair system in place that randomly distributes the money so that the "insiders" can't take advantage of the process. Heck, they could even offer discounts on newly purchased stocks that are held for a specified period of time with the printed money. This combined with a time held tax system would ensure that people were investing for the long haul instead of trading for fast cash with inside systems thus adding volatility to the market.
Nothing the Fed is doing is designed to honestly conserve long term value to the markets and level the playing field from well resourced insiders. All they are doing is a reverse wealth transfer from the middle class to the upper class. They are not rewarding investment because no one respects this market action. It's clearly public theft on a grand scale to anyone that shows approval for such criminality by buying into the existing corrupted market system that they are propping up. The only reason it works is because so many people are willing to accept these theft "payments" in exchange for withholding their outrage and contempt for such a plan and joining the foray. There are other options for righting or at least stabilizing this vessel, it's just that no one on the inside would handsomely benefit from the fair methods. It's always about the short term gain with this corrupt system and it used to be where you could excuse yourself from the dirty business running in the WallStreet casino but now you have to go in to recover your stolen money and hope you don't get fleeced again in the process.
The point is that they could make efforts to reduce the debt which would be positive for the markets in the "longer" term view as long as they combined those efforts with others to bring back integrity to the markets along with a focus on rewarding long term investors to a much greater risk degree than short term bandits which should be punitively taxed for their reduced risk tolerance like mutual funds do to customers who attempt to actively trade. It's just that there is no influential beneficiary to this plan and control and regulation are seen as a dangerous restrictive precedent to their creative financial freedoms.
Hey, that was a really great reply Reci, liked the metaphor and your comments, unfortunately we are going to get the wildfire at this late stage, hope it burns them all down, because the TBTFs, and their momma, absolutely have to go.
Maybe next time. btw, welcome to zh.