by Bill Bonner: The
US Empire: A Tragic Comedy in Three Acts
Wall Street movement is getting a fair amount of press. The movement,
as you know, dear reader, is a loose assembly of the jobless, the
homeless and the shiftless. Troublemakers, every one of them, with
no coherent or sensible view of what is wrong or how to fix it.
But whats wrong with that?
Wall Street protests started on Sept. 17 with a few dozen demonstrators
who tried to pitch tents in front of the New York Stock Exchange.
Since then, hundreds have set up camp in a park nearby and have
become increasingly organized, lining up medical aid and legal help
and printing their own newspaper, the Occupied Wall Street Journal.
About 100 demonstrators
were arrested on Sept. 24 and some were pepper-sprayed. On Saturday
police arrested 700 on charges of disorderly conduct and blocking
a public street as they tried to march over the Brooklyn Bridge.
Police said they took five more protesters into custody on Monday,
though it was unclear whether they had been charged with any crime.
the zombies stayed on the sidewalks as they wound through Manhattans
financial district chanting, How to fix the deficit: End the
war, tax the rich! They lurched along with their arms in front
of them. Some yelled, I smell money!
The US is probably
getting ready for a revolution. Back in the Cold War days, the CIA
was asked to do a portrait of a country that might have a revolution.
It decided that such a country would have three characteristics:
A big gap between
rich and poor.
A middle class
that was disappearing
or one that never existed in the first
A lot of people
with a grudge.
The US fits
each of these criteria. And then some others the spooks hadnt
thought about. The U6 broad measure of unemployment is going up
16.5% of the population without work. There are 6.2 million people
who have been looking for a job for more than 6 months.
$7 trillion poorer, according to David Rosenberg, than they were
4 years ago and property prices are still going down.
also a Great Correction in progress. It, along with the policies
of the US government, grind the faces of the poor.
marginally successful people think the system has failed them. Youth
joblessness is at Great Depression levels. More than 45 million
are on food stamps.
to think what they must think when they must think it. So, a person
who feels he has failed must come to terms with it. He must find
a reason that gets himself off the hook. It must be someone elses
It was not
his fault he failed his chemistry exam. The system should
provide him with a good job anyway. It was not his fault his house
got taken away; the system caused prices to fall
and his job
got exported to Mumbai. It was not his fault he didnt save
any money; the banks took advantage of him mercilessly. He may even
get a deficiency notice telling him he has to
pay the bank for its loss on his foreclosed house.
to injury, why dont you!
The guy has
a legitimate beef!
his fault that the Nixon administration cut the link to gold in
1971. It wasnt his fault the Chinese produced things better
and cheaper. It wasnt his fault that the feds kept stimulating
and encouraging him to go deeper and deeper into
debt at artificially low interest rates. And it certainly wasnt
he who caused the housing bubble to blow up
or who caused it
in the first place.
But one thing
you can depend on. Not many people will do the hard work of connecting
the kneebone of this disaster to the legbone that caused it. And
he wont want to make the sacrifices necessary to protect himself
from it either. (Our advice: cut expenses to almost zero
become a bankruptcy lawyer.) Instead, hell
join the revolution.
people do not join revolutions for good reasons. They join them
for bad ones. They expect miracles. One wants free money. The other
wants power. One wants to see his brother-in-law, who earns big
money as a currency trader at JPMorgan, brought low. Another just
wants to get high. One expects his mortgage to disappear. Another
wants the whole neighborhood to disappear. One hopes to see his
dead wife rise from the grave
the other hopes his live wife
will fall into it.
the bankers are rich and evil. Another believes the oil companies
are rich and evil. A third thinks all rich people are evil. And
a fourth believes that all people are evil, even those in the Occupy
Wall Street movement.
Some want to
save porpoises. Some want people to use only natural deodorant.
And a third thinks the world uses too much oil
and that only
people who drive Priuses should be allowed on the road on Sunday.
He owns a Prius dealership.
It is fun to
mock the protestors. Thats why we do it. They are such easy
But here at
The Daily Reckoning we always stand with the powerless, the
aimless and the witless. We are champions of the underdog
lost cause and the diehard. So, we lock arms with the protestors
and pledge our solidarity.
Vive la revolution!
But the poor
protestors are just victims of history. When the US embraced its
empire it condemned its middle classes. Why? Because thats
how empires work. They bring in cheap goods and sometimes
money itself from outside. Whether they are taken as booty
or traded for the imperial currency, the effect is about the same;
they undermine local industries and local wages.
imported wheat from Egypt, by the boatload, and gave it to citizens
(an early form of food stamps). Result: the price of wheat collapsed.
Small farmers couldnt compete with free wheat. They couldnt
earn a living.
also brought in slaves. Rich, politically-connected Romans took
over the small farms, consolidated them into big plantations, and
ran them with slave labor. Again, the local labor was out of luck.
so bad for the small farmers that they sold their children into
and then, themselves. Then, in alarm, an edict prohibited
Roman farmers from selling themselves into slavery. They were required
to remain on their farms
and at work.
Spain ran a
very different, short-lived empire in the 16th century. It conquered
New World civilizations and imported gold and silver on a colossal
scale. It was as if they were printing money! This easy money made
the Spaniards rich. They used it like America uses her dollars
to buy things from overseas. Pretty soon, the Spanish neglected
their own manufactures and their own farming. Prices rose. Spains
nascent middle class was smothered in the crib.
so different now? The rich get rich. The middle classes get poorer;
they have to compete with imperial plunder
riches coming from
Asia, bought with dollars that were never earned
will be redeemed.
middle classes were happy to sell their own children into perpetual
debt servitude. The kids face obligations 5 to 15 times as great
as annual output. Unless they revolt, they will have to work their
entire lives to pay for their parents excesses.
But what will
they do when future generations can take no more? They cannot sell
themselves into slavery. Theyve already done so. Most face
a lifetime of student debt, mortgage debt, and medical debt (aka
Medicaid and Medicare), already.
What can they
do? Join the revolution!
with permission from the Daily
Bonner is the author, with Addison Wiggin, of Financial
Reckoning Day: Surviving the Soft Depression of The 21st
The New Empire of Debt: The Rise Of An Epic Financial Crisis
and the co-author with Lila Rajiva of Mobs,
Messiahs and Markets (Wiley, 2007). His
latest book is Dice
Have No Memory.
Since 1999, Bill has been a daily contributor and the driving force
behind The Daily Reckoning.
© 2011 Daily Reckoning
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