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Disorderly Conduct
There has been much ado nationally and globally over the latest seemingly made for TV reality shows and soap operas emanating from the United States centered upon what is now known as the debt ceiling and sovereign default debate. At the heart of this ongoing multifaceted drama queen-isms are some very real philosophical differences that will cause long unappreciated or underappreciated dynamics to be addressed, wanted or not, in ways that will by the very nature of these differences be messy with many intended and unintended consequences. The simple fact that the United States is at the heart of the current global order means everyone is along for the ride. Welcome aboard the crazy train as America must now try, or soon will be forced by circumstance to attempt the transition from hipster adolescence to maturity.
As has been noted Ad nauseam through polling, Americans now expect, no demand ever lower taxes and higher quality and wide ranging “essential” services. This forms the crux of the developing debate in Washington and within broad society. This debate has been fomented and enhanced since the last great depression and WWII to a point of seeming absurdity. This absurd tragi-comedy now seems more like a festering malignant cancer rather than simply a cyst that can be easily treated to an ever greater portion of American and indeed world society. What many “Tea Partiers” are just now coming to appreciate is that a great deal of the government “cheese” they decry is in fact viewed as “essential” not only within their own districts, but to their personal philosophy (1).
It seems that for the balanced budget amendment (BBA) perspective of many fiscally conservative folks a moment of truth is arriving, if not with this latest go round, then perhaps as soon as the next election. This reality is, using a strictly Art Cashin like back of the envelope calculation, a true BBA would start from the premise that of the current 3.6 trillion federal budget 1.6 trillion would need to be cut to equal the roughly 2 trillion in receipts. Observing “austerity” in other regions currently or from what history of such events can teach us tells us one would need to cut an additional 400-800 billion from this sum as such a change to capital expenditure would be hugely deflationary to say the least as broad society would be massively restructured by such a change.
Such a change would drive federal spending to a range of 1.2 trillion to 1.6 trillion (in current metrics). This realization forms the crux of broad opposition to a BBA approach in other segments of society as it would eliminate the current structure of WIC cheese that forms the basis for the current status quo of broad society, the elites that draw the most sustenance from it and everyone else who is dependent upon it, one way or another. To say moving American society away from the painful addiction of cocaine/methamphetamine/opiate economics and the political life derived from it would be painful is a supreme understatement. No wonder the Tea Partyers are getting jawboned and slammed in the public and private spheres by the hopelessly afflicted and conflicted dope peddlers and their addicts.
This is counter-balanced by an ever greater appreciation within broad American society that the current structure of financing via a “Money Tree” payday loan hustle is totally unsustainable. This is one of the great lessons to broad society from the GFC, the great recession it has spawned and the ongoing restructuring of American households, communities, businesses, and now finance and government. So the questions more folks seem to be grappling with are the counter intuitive what’s in it for me vs how can this kind of governance be any good for me or anyone else when it is so very bad for me on a personal level? This internal discussion forms THE counterweight to the structures of the status quo. A counterweight no amount of FOXism/MSNBCism/WSJism/NYTism or any other kind of media induced massaging of public opinion will be able to temper as broad main stream media is now becoming ever more accepted, rightly or wrongly as a giant News of the World (2) enterprise more interested with hacking phones than news.
Meanwhile, all of these evolving issues are not lost upon broad human society, especially in the developing world, or those that have recently transitioned from developing to developed, or more developed as the case may be. It seems that the painful lessons of transition as discussed in the Korean experience by Ha-Joon Chang in: Bad Samaritans - The Myth of Free Trade and the Secret History of Capitalism (3) or in the developing dynamics recently discussed by Nader Mousavizadeh in his Reuters opinion article: How we got to the archipelago world (4) are an emerging reality for more of the world citizenry and their structures.
While there are many other examples available to causal inspection it seems that these painful lessons are often quickly lost, as exemplified in the experience of Chang. There are also emerging dynamics at play with those nations and peoples with the freshest memories of their own painful experiences as they move away from the super centralized macro econometricism and its attendant structures as they are now known. This move seems premised upon self-survival since they see great instability, hence great risk in the structures that supposedly provide stability, stability premised upon the ascendant “first world” and its attendant economic and political systems.
This ascendency is now being openly questioned as the first world and those that are hopelessly dependent upon its financial methamphetamine are increasingly seen as hopelessly addicted to fast food economics with the attendant morbid obesity, lack of exercise, diabetes, risk of stroke and all too apparent heart disease that will eventually kill it. In this they see their own recent experiences with economic death and have no desire to relive it any time soon, at least no more than is absolutely necessary given the dynamics at play with a seriously dope addicted first world at the hub of global finance and political life.
It appears an ever broader portion of American society and those societies of the emerging world are starting to come to the same conclusions, conclusions that the financial and political elite have no desire to acknowledge or appreciate since it means devolution of the power structures currently in place and depended upon by nearly everyone. These structures and their unraveling are keyed upon some basic common understandings. These understandings are all rooted in the concept of risk free risk expressed by the capital asset pricing model and the interdependency of the Sharpe ratio and the Black-Scholes model as recently discussed by Martin Hutchinson in an Reuters opinion piece titled: U.S. debt capers may expose “risk-free” fallacy (5).
No small wonder just about everyone thinks everyone else is being unreasonable in the current primary and ancillary debates.
Like it or not there is no such thing as risk free risk or a free lunch. As more folks wake up to the dawning reality, a reality that no amount of printing be it fiat currency or journalism can assuage the first things folks are doing is asking some hard questions. In the final analysis the questions being posed by an ever increasing portion of American and indeed world society are nothing compared with the questions that are forthcoming in the US and the answers the emerging world are now arriving at. These questions being where we are going, what are our goals and how will we get there as broad society moves beyond its learned fixation with blame fixing as a route to a sort of pseudo problem solving to the incredibly hard work of actual problem solving.
By our very nature Americans, with our penchant for optimism, these questions and the answers we come up with are now forming the next great defining moment in our national evolution. So, to those that would question our ability or resolve to undertake a process of resolution and transformation, a process that may very well be as messy as the processes that got us here, as our very nature and systems are by their very construct messy I would simply say: we’re a messy people and don’t bet against us. My associates and I here off South Main Street USA would also say: It’s our turn to strike the “you can for me” from our systems of self-government and firmly reestablish the concept of “I can” back in to AmerIcan life and its representative structures.
Cheers from off South Main Street USA
Links
2 - http://www.dailymail.co.uk/news/article-2012035/News-World-close-Sunday-announces-James-Murdoch.html
4 - http://blogs.reuters.com/nader-mousavizadeh/2011/07/25/how-we-got-to-the-archipelago-world/
5 - http://blogs.reuters.com/columns/2011/07/26/u-s-debt-capers-may-expose-risk-free-fallacy/
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HI Miles! Thanks for the essay!
No one, no party, nothing is perfect, but i firmly believe the tea party has the capability of saving the country. If the Republical party doesn't embrace and follow the austerity and required constriction of government spending and power, the split will be a split that will be a nail in the coffin of our country and i pray that will not happen.
Keep safe out there on South Main Miles!!!
Agrotera
Congratulations Miles!
I am optimist by nature. But sadly, I have come to conclude that we are not going to make any headway towards change until we have a real blow out. It may or may not occur in our lifetimes.
Excellent post by Miles although last paragraph left me hanging because all the changes I have lived through have been on a downward trajectory. Attitudinal shifts are important but structural changes forcing trajectory direction change is a prerequisite . Increasing debt limit will continue downward spiral for instance and continuation of power structure and similar practices/economics. How do we achieve structural change with or without upheval. Answer may be it is impossible through regulatory, constitutional and voter mandates. Perhaps there is also a macro economic cycle testing viability of any empire political/economic model. The current one is certainly under stress, and points to imminent collapse without viable alternatives . Perhaps we need another John Maynard, Marxs, Jefferson and Miles rolled into one.
The Tea Partiers, while trying to uncover the contradictions in the decade old status quo, are tripping over some of the new found truths, and so must be crazier than the established parties who still believe the lies hook, line, and sinker?
What kind of shitty argumentation is that?
Not that you are the only one with that line of thought, Miles, just saying.
Austerity does not mean poverty. We have in this country people who are grossly overpaid and who 'contribute' very little if nothing at all.
And then we have people who are grossly overpaid who are destroying peoples lives. (looking at you Valerie Jarrett & Lisa Jackson)
I am grossly underpaid by choice. I bet I 'contribute' more in 1 month than many of these dickheads in government leadership and union leadership do in a year. Being grossly underpaid is the trade off for a premium lifestyle which is based on anything but glossy materialism.
To paraphrase Sheryl Crow, I HAVE been there and the brochure may look nice but how much of your soul are you willing to sell for it.
How much of your soul are you selling? I'm buying mine back. My future is wide open. Trailblazing baby.
"No Man is an island", how many are you taking with you?
Very nice Miles, thank you! I agree that when it goes down to it, most of us regular folks will figure out the right thing to do, rather than what we can get away with...
This may indeed be the Second Civil War of the USA. This time we over throw the Slave Owners of Wall Street and Washington DC. We must FREE America. Let us use the tactics of MLK, Gandhi and Mandela. Keep faith in Americans. We ARE a Can Do People. USA.
I'm going long on this idea...
Come Deceember the debt ceiling debacle would no longer be spoken about. Once the debt ceiling is raised the media will shift to other more pressing matters.
There will be no revolution. Just new contenders on american idol.
If they do it like they are talking about now with a separate comittee giving more cuts in the coming months it will not be forgotten.
I agree with you that the debt ceiling debates going on now will eventually lead to the examination of the real issues at hand.
I also feel that many of those who oppose raising the debt ceiling and those who call for a balanced budget are not fully aware
of the consequences for themselves and their constituents. We cannot have the benefits of socialism without the cost of much higher
taxes. Most people are for cutting programs and entitlements to other 'less-deserving' groups as long as their piece of the pie is
left intact. A real solution would be a bitter pill for just about everyone. The dream of kicking the can down the road in hopes that
prosperity is just around the corner is fading fast. The reality of higher taxes and reduced spending in the face of a weak economy
and high unemployment is approaching fast. The longer we wait to face our problems, the more severe the problems become and
the closer we get to real default and utter chaos.
A nice article, Miles. Thank you for contributing.
Great article, Miles. Two points I took away are
1) The tea party has not really realized the dire effects that a BBA would have on our way of life. I'm glad you emphasized that with actual figures as to how much would have to be cut.
2) Even Main St Americans are starting to look with a jaundiced eye on MSM regarding it as more a source of phone hacking or the like than a balanced picture of reality. This is encouraging to hear.
These two points are enough for me. Thanks!
The debate has only nominally been about the debt ceiling. The ongoing deficits and how we will pay for them has been at the heart of the conversation all along. All the party leaders understand how cutting the budget has contractionary implications and that is why they have battled hard not to have to make those cuts. No doubt unemployement would rise and the stock markets would fall and it wouldn't do to have that right before an election. The blame game will be tremendous anyway but why go the route of a BBA when we can either print or monetize the wherewithal to fund the fedgov. Robbing folks by way of inflation is much easier and it is much harder to pin the blame on the folks running things. It is easy to blame big business, oil companies, speculators, hoarders, the Chinese or any other bugaboo we can think of.
Thanks Miles for putting it out there where we can see it.
Well done
one of the 2 statements i agree with Big O on (the other one being his 2006 quote on the debt ceiling):
"Change does not come from the top-down, but from the bottom-up."
time to put his little foot in his big mouth.
for the people that offer one sentence of drivel for a mans hard work!
for a mans feelings and thougts that are shared in hopes of improving the World..
these people are a plague upon mankind, sent by the devil himself to drag the world into darkness.
I would hope you are not a frail man Miles and that you will soldier on and continue in your way to fight the good fight.
The Corporate Media Machine.. is the way the "We the Sheepeople" are kept dumbed down.. that and flouride amongst ever other thing they can throw at us! to make us all ignorant of the rape that continues daily.
"Jews will play a leading role in multicultural Europe," says Jewish researcher
http://www.youtube.com/watch?v=VYeZW-WcSlc
http://www.youtube.com/watch?v=ZldFWb-mYBc&feature=related
Keiser Report: Oligarchy Propaganda (E164)
Miles...nice job!!! How to go....yes, I am reading ZH every day, better than ever. Still lurking......
Nice summary.
I would add however that there is no way to eliminate the consequences of a credit/debt based boom. The sooner this course is changed the less is the pain. As the magnitude now approaching the final, default stage, tha choice remain is default today or default tomorrow. Still the sooner the better stays true.
Meanwhile, our so-called leaders in D.C. are busily adding cosmetics to a swine and calling it a Debutante!
"Americans have a penchant for optimism" is a misnomer for sticking their heads in th sand and ignoring reality in favor of the free lunch. Lunch will be served with noting on the plate along with the bill payable in cash aka gold
Well said, Miles. Anyone who doesn't know we are in a depression, doesn't know anyone who does an honest day's work.
The MSM is in a sort of catatonic state of denial, less relevant by the minute, unless you live for celebrity gossip. They can't die soon enough. Please keep writing.
Miles,
Congrats on your first contributor piece. For you drive by types who don't like it, don't just hit and run, say why you don't like it. Could help Miles refine, could start a good conversation.
For my part Miles, I have decided there is no spoon. There is no Fed, no debt, no spoon. We are chickens on acid.
there is no goodwill either. at least as an accounting entry.
I think I agree with you, but could you please further describe this wonderful theory of "chickens on acid" ;)
Simply awesome.
I too have never lost faith in our people. But I long ago decided the elites are pretty much focked ;-)
http://www.youtube.com/watch?v=zs8QKXtCN9w
Nice rant, MK.
Neither "side", blinded by their own spittle, knows what they do.
A Kendig article! So-weet!
Like cattle, Americans sought refuge in a new party (of the T.E.A. kind), only to discover butchers waiting there too. Our political system is fucked - we can't wait for the Feds to "grant" us sovereignty - we must resist everything they do now. Anything they dangle in front of us is a Faustian bargain.
Not just awful...it was sophomoric.
Concise version....we all disagree on everything except the fact that the MSM puts out propaganda.
...wow...there's some news.
I loved it. I like the quote "It’s our turn to strike the “you can for me” from our systems of self-government and firmly reestablish the concept of “I can” back in to AmerIcan life and its representative structures. " Reminds me of Kennnedy's "Ask not what your country can do for you..."
Huh?
Huh?
Wow...that was really awful...