Guest Post: "We Have No Other Choice"

Tyler Durden's picture

Submitted by Charles Hugh Smith from Of Two Minds

We Have No Other Choice

America is just going through the motions because we have no other choice--or so we believe.

I have long thought that America Is Just Going Through the Motions--of caring about the deficit, of financial "reform," and everything else:

Let's be honest, shall we? There never was any fire for real reform of the financial sector. It was all rote, a foul, stupid play-act, a passionless pantomime of "caring" and fake-"progressiveness" displayed for propaganda purposes.

I now think we're just going through the motions because we have no other choice than to "extend and pretend" the Status Quo. Choice is of course a matter of perception, a situation where perception defines what is "possible" and what is "impossible."

Interestingly enough, the "possible" is what we think we can manage, while the "impossible" is what happens to us whether we thought it possible or not.

Consider the Federal Reserve. Liberal media mainstay The Atlantic published a fawning puff-piece lauding Ben Bernanke as the man who "saved the economy": The Villain: The left hates him. The right hates him even more. But Ben Bernanke saved the economy— and has navigated masterfully through the most trying of times.

We all know what Ben "saved," and it wasn't the economy--it was the fraud-based crony-capitalist financial sector. In case you missed the primer that explains the fundamental frauds at the heart of our economy:

Money from Nothing: A Primer on Fake Wealth Creation and its Implications (Part 1)
(Part 2)

Claiming that "saving the financial sector was necessary to save the economy" is akin to claiming that saving the massive tapeworm coiled inside the patient is necessary to save the patient: the logic is backward. The financial sector (tapeworm) is the cause of the economy's (the patient) weakness and collapse.

Ben is no genius nor is he a hero. He is simply doing what he has to because he has no other choice. What would happen if Ben didn't funnel hundreds of billions of dollars into the financial tapeworm? It would die, and the "too big to fail" banks--for all intents and purposes, the Fed's partners, and the generous funders of political toadies--would cease to exist. Extremely wealthy and powerful people-- the top 1/100 of the top 1%--would lose great wealth and the power it buys.

In a system that has become dependent on crony-capitalism and fraud for its very survival, then that is obviously not even a choice.

How about the political class of toadies, sycophants, leeches and cowards who passed a 2,300-page "reform" bill that nobody read, much less actually understands? Senator Dodd recently penned a bloviated defense of his "save the poor tapeworm" legislation, the Dodd–Frank Wall Street Reform and Consumer Protection Act in The Economist, claiming that it was "impossible" to "reform" our "complex" financial system with a mere 37 pages of legislation, the length of the original Glass-Steagal Act that separated commercial and investment banking: What If We're Beyond Mere Policy Tweaks? (February 6, 2012)

Consider the Glass-Steagall Act, at 37 pages in length, and the 2,319-page monstrosity of the “Dodd-Frank Wall Street Reform and Consumer Protection Act:" (Source)

Back in December, Nick Schulz helped put the size of the 2,074-page healthcare bill into some historical context by comparing its length to some previous bills that rank among the most consequential in U.S. history, like the 82-page Social Security Act of 1935 and the 74-page Civil Rights Act of 1964.


Now that Congress has passed the “Dodd-Frank Wall Street Reform and Consumer Protection Act,” it might be a good time to compare the 2,319-page financial reform bill (245 pages longer than the healthcare bill) to the previous bills listed below (and see graph) that are considered among the most consequential legislative acts for banking and finance.


1. Federal Reserve Act (1913) – 31 pages.


2. Glass-Steagall Act (1933) – 37 pages.

Actually, the entire fraudulent tapeworm could be killed with a single page of legislation, or more correctly, a single five-point paragraph: To wit:

1. Commercial banks cannot conduct any investment banking, and investment banks cannot conduct any commercial banking. Any financial institution that accepts deposits or issues loans or financial instruments of any nature will be regulated as a bank.

2. All assets of any nature must be listed at the close of business daily marked to market, as in the futures and options markets. If there is no regulated market for a class of financial instruments, the Treasury is instructed to establish and regulate a market for that class of financial instruments. Holding assets off-balance sheet is a criminal offense with a minimim fine of $10 billion per asset. If the fine cannot be paid in full, the FDIC is instructed to seize the bank and liquidate its assets in an orderly and timely manner.

3. No bank will be permitted to have assets or liabilities in excess of the smallest gross domestic product (GDP) of the 50 states.

4. No private banks may create any money through debt. All loans must be made out of existing deposits and equity. (via David V.)

5. No exceptions or exemptions are allowed to these statutes.

That would pretty much do it. Separate commercial from investment banking, require all assets to be marked to market every day, and limit banks from expanding to the point of being able to blackmail the nation, i.e. "too big to fail."

Instead, by one count, Dodd-Frank requires regulators to create 243 rules, conduct 67 studies, and issue 22 periodic reports. Does anyone seriously believe this complexity will "fix" anything?

But the legislators had no other choice. If they killed the TBTF banks, they would have killed their good friends and generous donors, so that was never a possibility. Ditto with healthcare "reform" and all the other phantom "reforms"--actually changing the Status Quo would cause immense financial pain in the class of wealthy people who fund the politicos and lobbyists, and trim money flows elsewhere in the system.

"Having no other choice" is a social fractal. Why do families persist in taking on $100,000 student loans for mostly mediocre educations with mostly mediocre "benefits" in the job market? Because they feel they have no other choice.

Why do people persist in mortgaging their future and accepting the yoke of debt-serfdom to own a house? Because they feel they have no other choice, and owning a house has become integral to the "American dream."

Why do local state, county and city politicos continue playing absurd budget games, shuffling funds, borrowing from their employees' pension plans to make this year's pension plan contribution and similar threadbare tricks? You guessed it: they have no other choice, lest someone somewhere feel some pain.

Why do our Federal "leaders" borrow $1.5 trillion each and every year now, fully 10% of the nation's total output, knowing full well that this level of borrowing will bankrupt the nation? (Don't forget to add in the "supplemental" off-budget borrowing.) You know: they have no other choice, lest someone somewhere feel some pain.

So instead they keep the accelerating vehicle pointed straight for the cliff. There are only two end-states to this level of borrowing: hyper-inflation or default. Any other "choice" is mere fantasy.

As noted above, what's possible is what you perceive, and what's impossible is what happens later whether you thought it possible or not. The Status Quo of a fraudulent financial system and a borrow-trillions-every-year-til-Doomsday Central State will implode, regardless of how many people think it "impossible."

If you take a star of sufficient heft such that it burns through its fuel at a rapid clip, then it will implode in a supernova whether you thought it possible or not.

"We have no other choice" is partly "deer in the headlights," partly fear of consequence and partly intellectual laziness, i.e. a continuing failure of imagination. Just to take two examples of many: anyone who is convinced they "have no other choice" but to enslave themselves with $100,000 in student loans should read Debt-Free U: How I Paid for an Outstanding College Education Without Loans, Scholarships, or Mooching off My Parents. Yes, it requires sacrifices and hard work, but it does outline a debt-free choice.

The Status Quo depends on debt-serfs who feel they "have no other choice" for its survival, but there are other ways of perceiving our financial options, for example Early Retirement Extreme: A philosophical and practical guide to financial independence.

OK, so these options may not be for everyone, but to deny they exist is delusional.

Consider America's second favorite obsession (the first being achieving "fame" by appearing on broadcast TV), losing weight. Here are two articles on the physics of weight loss by a UC-Berkeley physicist who lost 30 pounds: (via Ken R.)

The Physics Diet

On Gluttony

Is it "convenient" to lose weight? no, it is generally inconvenient and requires sacrifice, discipline and embracing responsibility--all the attributes of life we avoid by perceiving no other choice.

What's possible is what we perceive, and what's impossible is what happens later whether we thought it possible or not. The "impossible" systemic collapse will happen because we've left no other option open. We will get "wake-up calls" along the way, but these will be ignored because to change anything in the Status Quo will cause pain to someone somewhere, i.e. it is inconvenient.

Could we choose another future other than collapse? At this point, the answer is no, because we have no other choice.

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mrgneiss's picture

Because Bush Sr's real name is Scherff, and guess where he is from:

Is any of this true?

Seems like it would explain a lot, why we are here, where we are headed.

trav7777's picture

...and the band played on

that weblink you posted is dogshit.  Fuckin Warburg and Loeb and all of these were JEWS.  Webster Tarpley is fond of wild assed hatred of Germans...why doesn't he identify WHO the people were who precipitated WW2 through the financial chicanery that ended up starving germans to death?

CompassionateFascist's picture

Zionist banksters financed Nazi Party, late 1920s, then helped finance the Reich during the mid-1930s. Churchill, after bailing him out post '37 market crash, they flat out owned. The rest you know. "wake up calls"? There will be no more. '08 was a warning tremor. House Republicans had one last chance to kill the Beast w '11 debt ceiling vote. They caved. Die is now cast. Snake-eyes soon.


Simple, hyperinflate (which is going on) wipe out all debt.  Issue new gold & silver money from reserves - proportionately to every American via social security and other measurements to determine a fair payout for all citizens.  Done cocksuckerz!

theMAXILOPEZpsycho's picture

you forgot the deflation and crash part where the government/banks take over all the assests

FEDbuster's picture

Wouldn't you like to see Jamie Dimon come on CNBC say to Steve Liesman, "The FED? We are the God damn FED!"

mayhem_korner's picture



Debasement is going on now - not hyperinflation.  Hyperinflation is a loss of faith in currency; that hasn't happened yet.  And inflating debt away does not apply equally to all debt, especially consumer debt.  You can have high inflation, but unless wages move in tandem, those debt service payments don't get easier for consumers (in fact they get harder because more fiat is chasing staple items).


Are you really sure loss of faith in the US dollar isn't currently going on all over the world?  Germnay didn't 'hyperinflate' in a day.

mayhem_korner's picture



It has to happen en masse at the retail/consumer level.  You'll know when it happens.  Only a small % of us have moved all but a working capital allotment of fiat out of the banking system altogether and/or converted that fiat into stuff that's useful and holds value.

When you start to see ATM runs, hysteria, and mid-day price changes in things other than gasoline, then you'll know you've hit paydirt.

The stuff going on around the globe, especially the abandonment of petrodollars and the not-so-subtle trade agreements among the Chindos, is simply positioning for the post-dollar-collapse.

Reptil's picture

A citizen cannot lose faith in the currency if the citizien is MANDATED to buy his/her food with it, and when wages are in said currency.
Add sophisticated (invisible) electonic payment "services" and it'll be clear that whoever has the chip (implant) eats (peas).
Face it, we independents (financially, spiritualy) are a minority. Debt peonage is what's planned.
Will it work?

Partially. ;-)

EscapeKey's picture

"Fair"? You think Jamie Dimon gives a crap about what's "fair"?


"Fair"? You think Jamie Dimon gives a crap about what's "fair"?


That's why the inevitable complete and total destruction of debt and fiat must (will) take place.  There is no other way to wrestle the power from those in power, save a standing army.  All electronic / paper debts & 'wealth' will be eradicated.  Until the playing field is leveled, the owners and their leverage will rule.

illyia's picture

How long? A month? June? September? After the elections? After Martial Law ? After a Totalitarian Rule of Ten Years in the USSA?

It is so easy to dismiss the consequences and say: "Until all electronic / paper debts & 'wealth' are eradicated... Until the playing field is leveled, the owners and their leverage will rule..." But that could take a very long time.

[Or it could be fast and bloody. Either way]

easypoints's picture

A "Standing army" can take many different forms. Unfortunately, history shows it to be a prerequisite to the type of power shift you are talking about. The power of paper can change, only to change back again. Real change only happens after heads literally roll (1786 France). If violence isn't part of the reset, then no consequence was realized, and the morals of those in power remains unchanged. The same rigged system is re-worded even more perfectly, and celebrated by the people as a fresh start (1930 Germany).

Willzyx's picture

They tried fair in the former soviet union when they distributed shares of the former state owned companies.

InconvenientCounterParty's picture

Borrowing for health care is a black hole too.

All the GOP has to do is get that protected from bankrupcy law and they'll be all set.

Best Health care in the world accoding to Faux News. No mention of 10% healthcare inflation though.

theMAXILOPEZpsycho's picture

sure is going to be a laugh watching all those entitled diabetics, cancer patients, people on life support, fatsos with clogged arteries trying to fend for themselves once the nurses and docs have left in order to do the same thing...and probably taken the drugs with them to barter! Got popcorn?

espirit's picture

You have a better chance of survival if you wash up on the beach and get taken to Sea World.

Free meds, food, and love.

zerozulu's picture

Sure they have no other choice, But if some one has a choice its a wonderful idea. Get 100,000 loan and buy PM with your cash. wait till your son/daughter graduate than sell the pm and pay in penny.

Stanwick's picture

Bailed on your GED did ya

EscapeKey's picture

Hyperinflation is caused by government deficits.

And once inflation is set in motion, it is politically the easiest option to keep going.

twotraps's picture

Agree with you, because its been their default strategy to date.  However, the heavy implication is that they know what will happen if it gets out of hand, or will be able to control it.  There is no precedent for todays intervention, no way of knowing without massive last minute rule-changes to handle serious hyperinflation.  

FEDbuster's picture

Having the world's reserve currency and ZIRP, is like giving a Ferrari to a 16 year old for his birthday.  You know it will be fun for awhile, but it will end badly.  The crash will be epic, and even the most prepared will have trouble surviving. 

BLOTTO's picture

Reason? - because we are all being brainwashed.



Born-Again Bankster's picture kids are so fucked. 

centerline's picture

Not sure about that. Depending on age, they might be ok. The fucked is us.

Manthong's picture

 Yep, they are all screwed unless your idea of a good maturation process is “whatever doesn’t kill you makes you stronger".

centerline's picture

Nice to think for a moment though that we might be able to take the brunt of this for our kids.   Unfortunately you are more likely correct.  Odds are the world they inherit will be a more troubled place than the world is today.  This shitstorm may start off with bang, but it is most likely going to be generations in duration.

CompassionateFascist's picture

Not really. Teach them useful skills. Like hunting and fishing.

centerline's picture

Making wolf nipple chips.  LOL.

urbanelf's picture

Can't say I agree with #4.  There's nothing wrong with fractional reserve banking so long as it can never be a tax payer liability.  If you think a bank account is a bad investment, buy a safe and a shotgun.

theMAXILOPEZpsycho's picture, bullionvault...are they banks?

Manthong's picture

In the classic sense, yes and they would be legal for "currency" transactions if we practiced free market capitalism in the United States. 

10mm's picture

Buy a safe and additional guns.

espirit's picture

You're only as good as what you can carry.  Better stash the rest.

Dr. No's picture

I can understand your point, you premote customer beware.  However, Fractional Reserve banking can be difficult to stabilize without a flexible money supply.  In the event of a bank "run" and without the ability to print money, many depositors will be SOL.  buyer beware I agree.  It would be good to have your shotgun ready for this as well.  Actually, what banking situation cant be helped with a shotgun?

10mm's picture

Shotgun,if your in the city,fucking AK/AR.Were talking numbers,not a random breakin.

lolmao500's picture

The university bubble...

financial apocalyptic contagion's picture

Tyler why so quiet man??
The S&P just hit 1400 and no celebrations??

akak's picture

Equally mysterious is the absence of RobotLemming here crowing over this "achievement" that is largely the result of currency debasement and nothing more --- not that I am complaining, mind you.

lolmao500's picture

Bibi is nuts.

Netanyahu is preparing Israeli public opinion for a war on Iran


In his speech before the Knesset on Wednesday, Netanyahu urged his colleagues to reject claims that Israel is too weak to go it alone in a war against a regional power such as Iran and therefore needs to rely on the United States, which has much greater military capabilities, to do the job and remove the threat.


Netanyahu presented three examples in which his predecessors broke the American directive and made crucial decisions regarding the future of Israel: the declaration of independence in 1948, starting the Six Day War in 1967 and the bombing of the nuclear reactor in Iraq in 1981.

The lesson was clear: Just as David Ben-Gurion, Levi Eshkol and Menachem Begin said "no" to the White House, Netanyahu also needs not be alarmed by President Obama's opposition to an attack on Iran. Netanyahu believes that, as in the previous incidents, the U.S. may grumble at first, but will then quickly adopt the Israeli position and provide Israel with support and backing in the international community.

NotApplicable's picture

Just as soon as they sink the Enterprise.

I have to wonder if the damn thing hasn't already been preloaded with bombs so they don't have another embarrassing incident like they did when they failed to sink the USS Liberty.

PaperBear's picture

I have no other choice than to own physical silver because it is about to end its 140 year long demonitised status.

Stanwick's picture

140 years of waiting...zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzz

ebworthen's picture

And the "no other choice" is by design.

How do you steal from someone or make them look like the perpetrator?  Paint them into a corner, put them in an impossible situation where it is next to impossible to make it through the week without robbing Peter to pay Paul.

Bailouts for the Kleptoligarchy necessitates raping the citizenry, and the citizenry is blamed for wearing cut off shorts and sucking on a popsicle.