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Guest Post: Why Reforms Won't Work

Tyler Durden's picture


Submitted by Charles Hugh-Smith of OfTwoMinds blog,

Regardless of the need for reform, it isn't going to happen for these structural reasons.

The list of public/private institutions that desperately need structural reform is long: the Pentagon, healthcare (a.k.a. sickcare), Social Security, the complex mish-mash of programs that make up the Welfare State, the 73,000 page tax code, public pensions and the financial sector, to name just the top few.

Every reasonably informed person knows that all these institutions need deep, systemic reforms, not another layer of bureaucratic oversight or a few policy tweaks. As evidence that the Status Quo is finally confessing to the obvious, please read Can America Be Fixed? The New Crisis of Democracy by Fareed Zakaria (Foreign Affairs).

The article lays out the unsustainability of current public/private institutions and policies in irrefutable detail.

Regardless of the need for reform, it isn't going to happen for these structural reasons. In a nutshell, the public-relations America presented by the mainstream media and the State bears little resemblance to the actual machinery of finance and governance.

1. Elections have become the means to control the redistribution of national wealth to politically powerful cartels and constituencies rather than the pathway to good governance. Good governance gets abundant lip-service (propaganda supporting the flimsy facade of PR America), but American government has by and large lost the institutional memory of actual (as opposed to PR) good governance.

We might use the career of Paul Volcker as a window into what has been lost. As Austan Goolsbee writes in his review of Volcker: The Triumph of Persistence by William L. Silber: "Volcker still believes that public service is the most important thing someone can do, but he fears that this attitude may be a relic of a bygone era."

Why be coy? In a nation of revolving doors between public service and fat-cat corporate lobbying positions, it is decidedly a relic of a bygone era.

As Mr. Zakaria observes, "The system works better as a mechanism for campaign fundraising than it does as an instrument for financial oversight."

This institutional corruption and loss of good governance cannot be repaired in a single election, and it renders real reform impossible.

2. In a bought-and-paid for democracy like America's, vested interests protect their perquisites, power and share of the swag/national income regardless of the costs to the economy and society at large. This perversion of "national interest" to serve provincial, neofeudal fiefdoms necessarily leads to the real national interest being subverted and sacrificed on the altar of expediency and protection of the Status Quo at all costs.

In a bought-and-paid for democracy like America's, it is impossible for a government whose first priority is serving and maintaining vested interests to assert the national interest if that requires dismantling the vested interests' power and share of the swag.

3. This feeds a self-reinforcing feedback loop of political expediency. Since real reform requires cutting the perquisites and swag of self-serving fiefdoms and crony-capitalist cartels, phony "reforms" are passed in a purposefully obscure flurry of complex legislation that leaves all the real work to regulators who are politically in thrall to the very interests they are supposed to regulate.

These simulacra reforms feed the PR need to "do something to fix the problems" while doing nothing but extending the Status Quo and making the problem's next crisis that much worse.

Here is the perverse feedback loop: when the next crisis hits, the cuts to the Aristocracy's fiefdoms and constituencies would need to be even deeper and are therefore even more repellent, so real reform is even more impossible than in the initial crisis. Another round of toothless, hyper-complex regulation is hurriedly enacted, erecting a Complexity Fortess around the parasitic fiefdoms and cartels.

4. The political, corporate/financial and National Security State Elites represent a vanishingly thin layer of the American economy and society. America today is the nightmare scenario feared by James Madison and other Federalists: a covertly created monarchical (what I term neofeudal) empire much like the Roman Empire--a republic in name but in reality a highly centralized Empire operated for the benefit of tiny Elites who buy complicity of the masses with free bread and circuses.

The "Monarchical Federalists" Madison and Jefferson feared have indeed established a neofeudal, neocolonialist Empire.

In this context, it is interesting to note that fully 20% of all entitlements (tax credits, Medicare, Social Security, etc.) flows to the top 10%, 58% goes to middle-income households and 32% goes to the bottom 20%. The swag of bread and circuses is remarkably well-distributed, buying off every sector of the populace.

5. Behind the PR facade of democracy and free-market capitalism, a parasitic Aristocracy extracts income and wealth from a financially indentured class of serfs. This Aristocracy is composed of several Elites which are served by what I term the Upper Caste of technocrats (prep-school/Ivy League graduates who enter technical/managerial service in key institutions, plus a handful of officers brought up through the service academies and war colleges).

These Elites and the Upper Caste serve each others interests, a social heirarchy that Hilton Root characterized as a "society divided into closed, self-regarding groups." The slow trickle of the "best and brightest" into the Upper Caste via Ivy League university admission is also a propaganda facade, as Ron Unz ably and exhaustively proves in The Myth of American Meritocracy How corrupt are Ivy League admissions?

The trick is enable just enough meritocracy to support the PR facade. The Ivy League has mastered that balancing act.

These Elites have few if any links to the social layers below. Charles Murray spoke to some aspects of this trend of financial/social Elitist isolation from the debt-serfs and middle managerial class below in Coming Apart: The State of White America, 1960-2010, but the key dynamic that is outside Murray's sociological purview is the stark reality that the Elite class is devoid of any real feeling for or interest in the common good or public weal.

That is, not only have the key institutions of American governance and power lost the memory and mechanics of good governance, the Elites running the institutions have become an inbred neofeudal Aristocracy characterized by an unexamined (and thus deeply adolescent) sense of entitlement to the reins of power and control of the national income.

It's not just the institutions that have lost any conception of good governance-- the Aristocracy ruling the nation has lost all interest or recognition of the common good. This is of course not unique to America; the same disregard for the common good is at the root of Greece's status as a failed state.

The incestuous embrace of privilege and power by protected, socially isolated Elites characterizes failed states and brittle, doomed regimes throughout history. It is painful to recognize that this is precisely what America has become: a failed state that refuses to admit to its institutional failure because that would require the recognition of a neofeudal, neocolonial Empire ruled by a small, self-serving, parasitic political and financial Elite.

There is one last dynamic that has yet to unfold: the disconnected, protected and politically incestuous Elites at the top of the monarchical Empire recognize the need for real reform at the last minute, when it is too late to effect repairs on a rotten-to-the-core and bankrupt State.

America may be as long as a decade away from this final recognition and frenzied rush to reform what has already been destroyed by self-serving Elites and parasitic, parochial fiefdoms.

One key element in this dissolution of the corrupt regime is the wholesale abandonment of the Elites by the managerial class which belated grasps its role as enforcers of the parasitic class and accepts that its naive aspirational ties to the Elites were illusory: When Belief in the System Fades (March 12, 2008).

RIP: Our Expansionist Central State (23 Minutes, 25 Slides) CHS with Gordon T. Long:


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Thu, 02/07/2013 - 12:24 | 3223184 ParkAveFlasher
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We're totally heading into war.  Command and control economy.

Thu, 02/07/2013 - 12:30 | 3223198 Bad Attitude
Bad Attitude's picture

As Dear Leader says: "Forward!"

Thu, 02/07/2013 - 12:43 | 3223246 economics9698
economics9698's picture

Preaching to the choir. 

Thu, 02/07/2013 - 13:37 | 3223385 smiler03
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What has the Hoover Dam bypass bridge got to to with this article, a leap of faith?

Thu, 02/07/2013 - 16:17 | 3223958 mightycluck
mightycluck's picture

Watch the reform sessions in Congress. There will be no reform, just gov't control!!!!!!!!!!!!!!!!!!!!!!!!!!!

Thu, 02/07/2013 - 12:38 | 3223215 BLOTTO
BLOTTO's picture

And then, 'out of the chaos', comes 'order'...


Sound great eh?


Until one realizes its 'their' verision of 'order.'


Thu, 02/07/2013 - 12:26 | 3223187 Mike in GA
Mike in GA's picture

In sum, Collapse is the only workable "reform".

Long pitchforks.

Thu, 02/07/2013 - 12:31 | 3223200 Joe Davola
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Pitchforks will be limited to the blunt 3 tine variety in pending legislation.

Thu, 02/07/2013 - 12:42 | 3223240 willwork4food
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Then they better have their brownshirt henchmen guarding trees since a sharpend stick would look very good jammed up their elite-entitled asses.

Long wood products.

Thu, 02/07/2013 - 16:18 | 3223963 mightycluck
mightycluck's picture

Sorry. I was trying to post the story on Elizbeth Warren and her struggles to control lending.

Thu, 02/07/2013 - 12:35 | 3223213 otto skorzeny
otto skorzeny's picture

long long rifles

Thu, 02/07/2013 - 14:41 | 3223626 Rick Blaine
Rick Blaine's picture

even longer long rifles with short barrels

Thu, 02/07/2013 - 13:07 | 3223305 Vashta Nerada
Vashta Nerada's picture

Exactly.  What cannot be paid will not be paid.

Thu, 02/07/2013 - 12:27 | 3223189 LawsofPhysics
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Obviousman is back.  No shit the "elites" have no interest in those below them... maybe.

I'd argue those who worked from nothing providing new tech or a real fucking service may have some interest (although typically too busy actually working- the "birthright" elite certainly don't give a shit).  In any case, most fascists do not, at least until the guillotines roll that is...


Some things never change, hedge accordingly.

Thu, 02/07/2013 - 12:36 | 3223214 Spastica Rex
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Case in point: Bill Gates is a kind and goodly king who asks nothing but goodness from those who would curry his favour.

Thu, 02/07/2013 - 12:42 | 3223236 Azannoth
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Those who actually make it in this System become automatically "feudal lords" and have little to no interest in fighting the Status Quo and even if they tried their Empires are too dependent on the system and would instantly collapse (or get taken out by competitors) if they tried.

Even guys like the Google founders with their "Do no Evil" mantra cannot totally oversee a company this size and are constantly circled by lobbyists who put wool on their eyes, and the really good guys never make it anyway. No man or small group no matter the resources or commitment can make a difference they opposing forces are too strong and too entrenched, nothing short of a full blown reset.

Thu, 02/07/2013 - 12:43 | 3223247 Spastica Rex
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Dude, I've come to the conclusion that most people want kings.

Thu, 02/07/2013 - 12:46 | 3223261 Azannoth
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Yes they only bitch about "The King(s) bad manners" but never about the very existence of kings, Sheeple will be Sheeple can't help it

Thu, 02/07/2013 - 12:46 | 3223263 francis_sawyer
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I agree 100%... The only people who don't want kings are 'other' kings...

Thu, 02/07/2013 - 12:48 | 3223264 francis_sawyer
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Thu, 02/07/2013 - 14:17 | 3223530 CH1
CH1's picture

Two up arows for a dot.

That's interesting.

Thu, 02/07/2013 - 14:59 | 3223682 francis_sawyer
francis_sawyer's picture

What's your opinion on this?


_ . . .       . _ . .       _ _ _       . _ _                     _ _       .

Thu, 02/07/2013 - 12:46 | 3223265 francis_sawyer
francis_sawyer's picture

I agree 100%... The only people who don't want kings are 'other' kings...

Thu, 02/07/2013 - 12:47 | 3223268 Spastica Rex
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Thu, 02/07/2013 - 12:50 | 3223266 francis_sawyer
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Damn ~ the Hedge is sticky today

Thu, 02/07/2013 - 12:50 | 3223276 Dr. Engali
Dr. Engali's picture

Unfortunately you are right. Having to make your own decisions is hard for most people.

Thu, 02/07/2013 - 12:29 | 3223193 Joe Davola
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Holding up Volcker's belief that public service is the most important thing one can do is closer to the real problem.

Thu, 02/07/2013 - 12:35 | 3223209 kridkrid
kridkrid's picture

Deep down, people don't really buy that BS. It's a card that sociopaths play to gain trust. It works for most, has the opposite effect on people who can see and think.

Thu, 02/07/2013 - 12:39 | 3223221 otto skorzeny
otto skorzeny's picture

volcker is a conservative keynesian-pay no mind to him

Thu, 02/07/2013 - 12:31 | 3223202 dbTX
dbTX's picture

It's not going to happen because we are dead ass broke.

Thu, 02/07/2013 - 12:45 | 3223257 eclectic syncretist
eclectic syncretist's picture

Bullshit.  We are our most valuable asset no matter what.  What Charles Hugh-Jass of Obtuse Minds and too many other people don't realize is that we have all the power we believe we have, and if we want to take BS Bernanke and all the other Central Banksters and Criminals and get rid of them we can.


Thu, 02/07/2013 - 14:20 | 3223545 CH1
CH1's picture

We are our most valuable asset no matter what.

No argument, but so long as you keep treating the elite as though they are the center of the universe, they'll keep doing exactly what they're doing.

The answer is not to "get rid of them," but to walk away from their circus.

Thu, 02/07/2013 - 12:35 | 3223211 CrashisOptimistic
CrashisOptimistic's picture

Verbal gobbledygook.

It's about numbers and nothing but numbers.

The Sequester is $85B (and more to come in upcoming years).  They want to replace it with other cuts or tax increases?

Go ahead.  Go ahead and have your taxes.

Just make DAMN SURE it's more than $85B IN 2013.  No bullshit delays.  Cut cut cut . . . NOW.  DO IT NOW.

They can't.  GDP will implode.  They know it.  This is what tipping point meant.  We're past it.  People are going to die by the billions.

Thu, 02/07/2013 - 12:42 | 3223238 Spastica Rex
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People are going to die by the billions.

Of course, everyone will.

Thu, 02/07/2013 - 13:17 | 3223322 Vashta Nerada
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So, essentially, if the sequester was increased by 15X, we would be close to matching spending to tax revenue.

Thu, 02/07/2013 - 14:06 | 3223486 Thisson
Thisson's picture

It's a myth that GDP will "implode" when gov't stops spending.  GDP represents the distribution of production.  For example: assume GDP is, initially, 100 units of resources.  Of these units, 25 are allocated to Consumption, 25 to Investment, 25 to Government Spending, and 25 are Exported.  Suddenly government decides not to consume any resources, and uses 0 units instead of 25.  Those 25 units are now available to be used for Consumption, Investment, or Exported.  Most importantly, only units allocated to investment increase productivity so that there will be more units available for distribution in the future.  This is fucking common sense.  Yet professional economists continually argue that the economy can possibly grow by increasing the allocation of resources to Government and Consumption.  It's complete idiocy!

Thu, 02/07/2013 - 16:10 | 3223938 DR
DR's picture

"Those 25 units are now available to be used for Consumption, Investment, or Exported"


If there is a demand for these 25 units, otherwise GDP implodes. Private sector investment is at record post WWII recovery lows. No one wants to invest in real production-everybody wants to inflate paper. 

Thu, 02/07/2013 - 16:12 | 3223943 Matt
Matt's picture

Government is increasingly funded by debt. If government spending drops, no one else is going to be willing or able to borrow to spend equal to what the government spends. Therefore, not only will the government spending become a smaller portion of the pie, but the pie itself becomes smaller.

Normally, this is considered a normal thing after a massive credit boom. Under Keynesian systems with debt beyond sustainable limits, a shrinking pie (total GDP) is a calamity. Tax reciepts shrink while the debt grows, leading to more and more printing to try to keep the system from collapsing.

I guess it also helps if you distinguish nominal GDP from real productivity.

Thu, 02/07/2013 - 12:36 | 3223218 Floodmaster
Floodmaster's picture
Defense-related expenditure 2012 Budget request & Mandatory spending[22][23] Calculation[24][25] DOD spending $707.5 billion Base budget + "Overseas Contingency Operations" FBI counter-terrorism $2.9 billion At least one-third FBI budget. International Affairs $5.6–$63.0 billion At minimum, foreign arms sales. At most, entire State budget Energy Department, defense-related $21.8 billion   Veterans Affairs $70.0 billion   Homeland Security $46.9 billion   NASA, satellites $3.5–$8.7 billion Between 20% and 50% of NASA's total budget Veterans pensions $54.6 billion   Other defense-related mandatory spending $8.2 billion   Interest on debt incurred in past wars $109.1–$431.5 billion Between 23% and 91% of total interest Total Spending $1.030–$1.415 trillion
Thu, 02/07/2013 - 12:39 | 3223225 LawsofPhysics
LawsofPhysics's picture

none of which is even remotely on any sort of chopping block.

Thu, 02/07/2013 - 12:46 | 3223242 CrashisOptimistic
CrashisOptimistic's picture

Not sure what that's all supposed to mean.  That there is money spent to defend 15.6Trillion in GDP?  So go ahead and cut it.  Go ahead.  Cut it big.

GDP will implode.  It doesn't matter what you cut.  GDP will implode.

BTW you left out the portion of Social Security paid to military retirees, since they pay in.  So be sure you include some SS cuts too.  You also left out the tax deduction for home mortgages for houses owned by active duty military stationed at a base.  You also left out that portion of Dept of Education that could be apportioned to children of active or retired military.

You must be a right winger.

Thu, 02/07/2013 - 12:50 | 3223274 RSBriggs
RSBriggs's picture

-1 for being a fucking leftist idiot troll...

Thu, 02/07/2013 - 13:11 | 3223315 Vashta Nerada
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National defense is actually in the constitution, unlike all of the other 'mandatory' spending.

Thu, 02/07/2013 - 14:09 | 3223501 Thisson
Thisson's picture

Defense yes.  Offense, no!  Almost all of that spending is for offense!

Thu, 02/07/2013 - 14:14 | 3223517 Vashta Nerada
Vashta Nerada's picture

I had always heard that a good offense was the best defense, or was it the other way around?

Thu, 02/07/2013 - 14:20 | 3223544 LawsofPhysics
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Pssstt.  Bill of Rights > Constitution.  

Thu, 02/07/2013 - 14:13 | 3223514 CH1
CH1's picture

First of all, I never agreed to be bound by the constitution.

Secondly, "national defense" and "bases in 120+ countries" are a LONG way from synonymous.

Thu, 02/07/2013 - 14:20 | 3223546 Vashta Nerada
Vashta Nerada's picture

I certainly agree that defense can be cut, my point being that of all of the supposedly sacrosanct items we spend on, somehow the 60% of total spending on various welfare programs is ignored, while the 20% of spending on defense which is actually constitutional is focused upon.

Thu, 02/07/2013 - 14:37 | 3223612 CH1
CH1's picture

Fair enough.

Thu, 02/07/2013 - 15:08 | 3223727 Totentänzerlied
Totentänzerlied's picture

Constitutionality is no excuse. What's that? Yes, the Constitution can be wrong. If it was right in any meaningul way, the present situation would not exist. Just another piece of paper they dangle in front of you.

Thu, 02/07/2013 - 13:59 | 3223458 Falconsixone
Falconsixone's picture

Haha...Yeah...DOD...That's not counting the DOO (Dept. Of Opium)... Probably same # or more...I wonder if the corner dealers getting retirement?

Thu, 02/07/2013 - 12:45 | 3223222 Mercury
Mercury's picture

...the Elite class is devoid of any real feeling for or interest in the common good or public weal.

To paraphrase an editorial in the WSJ today, why are rich leftists all about "simplicity" "organic" and "local" in their personal lives but when it comes to politics they're all about complex, remote, governance stuffed with artificial additives and preservatives and produced by an all-powerful conglomerate that limits choice?

Thu, 02/07/2013 - 15:12 | 3223738 Totentänzerlied
Totentänzerlied's picture

You're not very familiar with how Marxist communism works, are you?


Thu, 02/07/2013 - 12:43 | 3223226 Dr. Engali
Dr. Engali's picture

Charles you are a little behind the curve with this post. It has been obvious for years that the empire is in it's death throws and the elite are curently pillaging what's left of her. It's also obvious that they don't care about the sheeple, they have another agenda in mind and it sure isn't for the benefit of us.  We are in the terminal phase of empir's life span. It will continue to accelerate downward and there won't be any "structural reform" until there is a complete collapse.

Thu, 02/07/2013 - 16:05 | 3223920 SmallerGovNow2
SmallerGovNow2's picture

Let's bring the collapse already doc, I'm sick and tired of watching this slow motion train wreck...

Thu, 02/07/2013 - 12:42 | 3223241 1000yrdstare
1000yrdstare's picture

Will it work? ....Try taking a pork chop away from a pitbull.....same result.

Thu, 02/07/2013 - 12:42 | 3223243 Inthemix96
Inthemix96's picture

They dont care about reforms, because they dont give a shit.

So long as these filthy perverts are at the helm, helping themselves to the fruits of OUR collective labour, selling their own souls for fucking money, they couldnt give a fucking shit about the average joe.  Today you are not even a number to these cunts, you are there to pay into the system for their expense claims and when have been worn out on the hamster wheel another one comes along for more profits and graft for them.  Get it into your fucking minds people, these bastards only care about themselves and fuck us any way they can.  Reforms?  Fuck reforms.  This game is over, they have robbed everything we had, and the way these fuckers get the "get out of jail" card, is to send us and our kids to war.

Frankly folks, if we dont stop this, these fuckers is gonna have us fighting in Aisa.  We need to put a stop to them before they kill us all.

Thu, 02/07/2013 - 14:39 | 3223520 CH1
CH1's picture

They dont care about reforms, because they dont give a shit.

Agreed. And things will never, ever change, so long as we keep obeying them. EVER.

Thu, 02/07/2013 - 15:24 | 3223786 Totentänzerlied
Totentänzerlied's picture

Let's not be naive. The elites are very pro-reform. Campaign-finance reform ... to allow them to buy their lackeys off even more easily. Healthcare reform ... to increase their insurance co./pharma co. profits. Tax reform ... to pay less in taxes and pilfer more of everyone else's wealth. Foreign policy reform ... to conduct even more unethical activities to boost their MIC profits. Regulatory reform ... to erect more barriers to entry, discourage small entrepreneurs, prevent anyone from competing with their firms, set up cartels/monopolies with the blessing of the state, etc. Education reform ... to create their future min. wage employees who will never cause trouble politically or intellectually, not to mention feed the kids garbage (to benefit sickcare cos.) and buy off the teachers.

Reforms are great, the elites love reforms. Because they dictate what the reforms will entail. CHS proves himself, once again, either naive or deceitful.

Thu, 02/07/2013 - 12:45 | 3223256 centerline
centerline's picture

Good article CHS.

What is needed now is to start blending this with the shift into a post-industrial, lower EROEI world.

Then start asking questions.  Beginning with the idea that we are not the only ones who see the mathematical fail of perpetual growth.  Let's collectively connect the dots and come to some reasonable conclusions.

Thu, 02/07/2013 - 16:02 | 3223916 SmallerGovNow2
SmallerGovNow2's picture

Don't you mean higher EROEI ?

When the EROEI of a resource is less than or equal to one, that energy source becomes an "energy sink", and can no longer be used as a primary source of energy.

Thu, 02/07/2013 - 12:48 | 3223270 LongSoupLine
LongSoupLine's picture

Why reforms won't work...


Those in fucking power do not make money off fucking reform.  Reform helps the real, honest money makers of nations.


Fuck you Obama, Chicago fucking crooked prick.

Thu, 02/07/2013 - 19:26 | 3223324 prains
prains's picture

I'm not sure where Cheney and Rummy hail from but I know a couple of gangsters when i see them 

what was the bill again? 2.3 trillion?

Thu, 02/07/2013 - 12:52 | 3223278 Catullus
Catullus's picture

If there is an elite parasitic ruling class, then I can't believe that what happened in 2008 was purposeful. It was never an attempt to crash the economy to shake people out. There was no reason to risk everything to do that. Instead, I think that rich ruling elite was frightened to the very core. We were going to wake up the next day with no money in our checking accounts. They would have been ripped limb from limb and they know it.

I'll continue to post this: the bailouts in 08-09 were about control and nothing else. A forced liquidation would have caused key assets to be divided up to the non-elite. This was simply an unimaginable scenario. And when you hear from some of the elite's managers that it was the "responsible thing to do", it's because anything else would have meant loss of control.

Thu, 02/07/2013 - 13:15 | 3223328 centerline
centerline's picture

2008 may have been on purpose and was controlled quite well.

But, I really like the thought process here that you are running with.  This sort of thinking is what is needed more around here.  


Thu, 02/07/2013 - 14:41 | 3223627 Matt
Matt's picture

The Queen of England lost a fortune in the 2008 crash. Has anyone found if the Rothschilds lost money? It seems to me that you cannot accuse people of being in on a conspiracy, when they are on the losing end of the situation. I think the Ackman / Icahn squabble clearly illustrates that there is no one unified group of uber-rich, but rather a divided group competing with each other.

Thu, 02/07/2013 - 15:00 | 3223683 centerline
centerline's picture

I totally agree. Multiple groups seeking different outcomes.  No doubt.  Definately has to be considered in any attempt to piece together a clearer picture of what is going on.

Thu, 02/07/2013 - 16:29 | 3224005 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

I'll agree with one sentiment in this whole thing; when you get right down to it, it is always about power and control, nothing more nothing less.

Thu, 02/07/2013 - 13:44 | 3223409 forwardho
forwardho's picture

Yes, caught with pants around ankles.

The four+ years have not been wasted. Societal controls are now in place. At first I was shocked,(foolish me) that 93 out of 100 senators would vote for a draconian NDAA. Then realized they saw behind the curtain, and were afraid. "Belligerent acts" indeed. Healthcare will soon be controled, who will dare speak out (far less stand up) when services that may save you life could be denied? All the ducks are now in a row. Total control is attainable.

Power, naked merciless power!

Thu, 02/07/2013 - 15:06 | 3223717 centerline
centerline's picture

I wrote about this the other day actually.  What seems like such horrific acts by so many politicians makes perfect sense in the context of them seeing being the curtain... getting exposed to the impossible math, the consequences of inevitable failure, etc.  Even then, they are still just stooges.

Thu, 02/07/2013 - 14:21 | 3223550 Falconsixone
Falconsixone's picture

Catullus....I n my opinion you are wrong.


It is no accident. All planned destruction of this country and all the others. Divide and conquer, Order out of Chaos, Huxley, Agenda 21, Bilderberg, Illuminati, Club of Rome, Masons, Zionist, Royalty...on and on


If you control the land and the sea and the wind is your ship ever going to run aground if you don't plan it?


The only thing those cunts don't control is Americans with arms. Which is what keeps most of the world decent. If those guns go the world turns in to a dark place you will not like at all.

Thu, 02/07/2013 - 14:33 | 3223590 Catullus
Catullus's picture

Fair, but let's say these organizations do exist, why would risk a collapse? Its a big gamble, and the reward is not obvious. So even they did take a conscience decision to crash the markets, then it seems like they didn't get much on the back end. Either way (meaning cadre of acting elites or not), I think they're incompetent. Smart people spend their entire existence not getting themselves into situations like that.

Thu, 02/07/2013 - 15:17 | 3223760 centerline
centerline's picture

Collapse is coming one way or another.

The truly powerful can attempt to avert disaster in a peaceful and honest manner - which will never happen when there are multiple groups competing for different outcomes.  Would also go against human nature in so many ways.  Would require adult conversations, etc.  lol.

Or, they can let fate have it's way.  Big risk here.

Or, they can attempt to control the outcome and crush the opposition in the process.  This is where I think we are.  The reward is survival.  The reward is a seat of power in the world that is to come.  To be able to continue a life of luxury while Rome burns.  Some might even see it as "saving the Earth" or "saving the human race."



Thu, 02/07/2013 - 15:45 | 3223862 Not Too Important
Not Too Important's picture

Yes, collapse is coming. The 3 trillion lethal doses of plutonium spreading around the planet from Fukushima will see to that.


“Fukushima Equals 3,000 Billion Lethal Doses"

“Dr Paolo Scampa, a widely know EU Physicist, single handedly popularized the easily understood Lethal Doses concept. “Lethal Doses” is a world wide, well understood idea that strips Physics bare and offers a brilliant, understandable explanation for all the physics gobbledygook Intelligence agencies and their respective governments use to disguise the brutal truths of the Fukushima Daiichi Disaster." "Three thousand billion (3,000,000,000,000) Lethal Doses of Radiation means there are 429 Lethal Doses chasing each and every one of us on the planet, to put it in a nutshell. This is up from about 70 Billion Lethal Doses March 23, 2011. It is getting worse everyday without any intervention by the US and the other nuclear powers….”

"Note that the lethality of radioactive reactor cores goes up the first 250,000 years they are out of the reactor – not down."

Thu, 02/07/2013 - 15:33 | 3223822 Totentänzerlied
Totentänzerlied's picture

"why would risk a collapse?"

Because. They. Own. 90%. of. Everything. Worth. Owning.

A collapse is bad for you. Not for them. At least that's what they believe. And why shouldn't they ... they own people (paid off), land, precious metals, means of production, resources, mines, water sources, you name it. All the stuff you need to get by, and all the stuff everyone else wants.

Time and time again in history, the elites of any given society believed - for all sorts of reasons, credible and not - that they would always come out on top. No different this time. It's what they're raised on and inculcated with - how to influence and control others. When there is a collapse, you can bet your last dollar they believe they'll be coming out on top when the dust settles, even if that means taking the show to another country or continent, which they are more than happy to do, as European history circa 1600-1945 demonstrates.

Thu, 02/07/2013 - 14:46 | 3223643 Matt
Matt's picture

I think there is much that is uncontrollable, and much where the control is quite tentative.

The algos are never truly under control; one random technician can screw up and send things out of control at any moment.

Droughts, Earthquakes, riots. All well out of control. The masses are never more than three missed meals away from revolution. That, I believe, is the message of the Arab Spring. Nothing to do with a sudden desire for democracy, just a desire for some affordable bread.

Thu, 02/07/2013 - 13:01 | 3223286 Dr. Engali
Dr. Engali's picture

The Hedge has been going off line a lot lately. Are the servers overloading, or is it something a little more sinister ?

Thu, 02/07/2013 - 13:09 | 3223311 slightlyskeptical
slightlyskeptical's picture

I think it your own internal issue. I have never been 404'ed on Zero Hedge.

Thu, 02/07/2013 - 13:45 | 3223412 CommunityStandard
CommunityStandard's picture

I was 404'd for about an hour as well, unless I've been working in the same office as Engali this whole time and never realized....

Thu, 02/07/2013 - 13:07 | 3223292 ebworthen
ebworthen's picture

When individual vice is rewarded while individual virtue is punished - there is no group or organizational solution other than shame and repudiation of individual vice.

The corrupt used to be tar and feathered and chased out of town - instead of held up as heroes or visionaries. 

Equivocation and moral turpitude are held in high regard.

Society has abandoned the utility of shame, and instead embraced moral relativism.

Rather than the cream of society floating to the top of government and industry it has been the bad bowel movements.

Thu, 02/07/2013 - 13:03 | 3223297 IamtheREALmario
IamtheREALmario's picture

Nice article.

I agree that when the managerial class realizes that it is doing all of the work and the elitist are just parasites then there will be real change and the managergial class will once again try to make sure that such a travesty never happens again.

Currently the managerial class still view their lives as privileged ... but that will change as the middle class is destroyed.

Thu, 02/07/2013 - 14:14 | 3223515 Thisson
Thisson's picture

No, once they realize how it works the managerial class scheme to become the parasites in the next iteration of the system.

Thu, 02/07/2013 - 15:35 | 3223832 Totentänzerlied
Totentänzerlied's picture

Who the hell junked you?

Thu, 02/07/2013 - 16:28 | 3224001 Totentänzerlied
Totentänzerlied's picture

No, the managerial class wants to become the elites.

Thu, 02/07/2013 - 14:56 | 3223673 10mm
10mm's picture

And now DHS is set to purchase a further 21.6 million rounds of ammo  to add to the 1.6 billion bullets it already obtained in the last 10 months.10 miilion .40 cal HPs,10 million 9mm 115 gr HPs,1 million 9mm fmj's.

Thu, 02/07/2013 - 15:41 | 3223847 Not Too Important
Not Too Important's picture

Keeps it off the shelves, to starve the civilians. Best to learn how to make your own.


Sat, 02/09/2013 - 04:28 | 3228338 The Navigator
The Navigator's picture

Keep (1) rotating and (2) increasing your stock of ammo. And for longevity, keep it dry.

Thu, 02/07/2013 - 15:20 | 3223772 dadichris
dadichris's picture

these are all the symptoms of an empire in decline. nature will simply take its course...

Thu, 02/07/2013 - 15:35 | 3223831 skipjack
skipjack's picture

Except that the Constitution prohibits a standing army of a longer duration than 2 years...we don't need anywhere near the Army we have.

Thu, 02/07/2013 - 16:32 | 3224020 exgop
exgop's picture

we do now skipjack years of world domination tends to create enemies with good reason

Thu, 02/07/2013 - 16:41 | 3224042 Hail Spode
Hail Spode's picture

Excellent post.   I'm just trying to hang on until the failure of central planning, and it feels relatively close now.    Corrupt systems like this one eventually collapse due to being unable to support the weight of their own lies.  The one thing that could save them- realistic feedback from a free market, is the very thing they are constantly trying to stop.   It turns out perception is not reality after all, and the longer people try to pretend that it is, the heaver the 2x4 of reality feels when it finally hits them in the forehead.

Thu, 02/07/2013 - 16:57 | 3224111 decentralizedsc...
decentralizedscutinizer's picture

There is a solution: re-vitalize the basic constitutional power structure of citizen sovereignty with a firewall between corporation and state similar to the firewall that exists between church and state. It was thought in 1776 that the church would corrupt the state and the state would correspondingly corrupt the church. It should be obvious today that big business and federal government have totally corrupted each other; equally. We know that free-market capitalism can't work when the government interferes and we likewise know that democratic republics can't function (as advertised) when corporations can use their money to exert conflicting interests. There needs to be a firewall to separate the public's interest from the special interests of a free economy. The Constitution limits the power of government but nothing limits the power of global corporation (banks) . We can fix that with a short, simple amendment:  

28th Amendment

"Corporations are not persons in any sense of the word and shall be granted only those rights and privileges that Congress deems necessary for the well-being of the People. Congress shall provide legislation defining the terms and conditions of corporate charters according to their purpose; which shall include, but are not limited to: 1, prohibitions against any corporation becoming so large its failure would pose a threat to national security or harm the general economy; 2, prohibitions against any form of interference in the affairs of government, education, and news media; and 3, provisions for civil and criminal penalties to be paid by corporate executives for violation of the terms of a corporate charter."


Politics and economics are two very different sciences. Free-market capitalism and democracy can work together; but there needs to be rules.

Thu, 02/07/2013 - 17:30 | 3224223 Vidar
Vidar's picture

A simpler and more effective amendment would be :


"The necessity of separation between Economy and State is recognized as absolute, and every individual has the absolute right to produce, exchange, and consume any article of property, including both goods and services. Therefore, Congress shall make no law interfering with the production, sale, ownership, or consumption of any good or service."


This would eliminate 99% of the Federal government and reduce it to simply defending the borders and resolving disputes involving parties living in more than one state (the military and the federal courts) which are the only two things that the individual states can't handle on their own.

I would like to see the federal, state, and local governments abolished entirely and the institution of a private law society, but until enough people have an understanding of how such a system would work a minimal state bound by the above amendment would at least be unable to threaten the rights of the citizens.

Thu, 02/07/2013 - 20:34 | 3224654 Hail Spode
Hail Spode's picture

Good screen name.  Both your screen name and the point about the threat of corporations to the rights and interests of ACTUAL persons reminds me of the philosophy of government called "Localism".   The ebook "Localism, A Philosophy of Government" addresses the very points you raise, and then some.  Also, it keeps saying "The key tennant of Localism is the decentralization of power."   It might be worth checking out.  On Barnes and Noble.

On Amazon in case you have a Kindle

Fri, 02/08/2013 - 01:06 | 3225205 michael_engineer
michael_engineer's picture

Still no mention by this CHS of resource constraints and scarcities being in play. Makes you wonder what his motive is for not going there.

Sat, 02/09/2013 - 23:59 | 3229839 proLiberty
proLiberty's picture

Professor Joseph T. Salerno wrote of this problem in,  Postscript: Why a Socialist Economy is "Impossible":

In "Economic Calculation in a Socialist Commonwealth," Ludwig von Mises demonstrates, once and forever, that, under socialist central planning, there are no means of economic calculation and that, therefore, socialist economy itself is "impossible" ("unm?glich")--not just inefficient or less innovative or conducted without benefit of decentralized knowledge, but really and truly and literally impossible.

At the same time, he establishes that the necessary and sufficient conditions of the existence and evolution of human society is liberty, property, and sound money: the liberty of each individual to produce and exchange according to independently formed value judgments and price appraisements; unrestricted private ownership of all types and orders of producers' goods as well as of consumers' good; and the existence of a universal medium of exchange whose value is not subject to large or unforeseeable variations.



"Mises demonstrated that, in any economy more complex than the Crusoe or primitive family level, the socialist planning board would simply not know what to do, or how to answer any of these vital questions.  Developing the momentous concept of "calculation", Mises pointed out that the planning board could not answer these question because socialism would lack the indispensable tool that private entrepreneurs use to appraise and calculate: the existence of a market in the means of production, a market that bring about money prices based on genuine profit-seeking exchanges by private owners of these means of production.  Since the very essence of socialism is collective ownership of the means of production, the planning board woud not be able to plan or to make any sort of rational economic decisions.  Its decisions would necessarily be of completely arbitrary and chaotic, and therefore the existence of a socialist planned economy is literally "impossible" (to use a term long ridiculed by Mises's critics)."


Murray M. Rothbard, The End of Socialism and the Calculation Debate Revisited, The Review of Austrian Economics, Vol 5, No. 2

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