by Simon Black: Is
the Debt Problem as Bad as They Say?
In the 15th
century, the highest standard of living in the world belonged to
China. Places like Nanjing had reached the pinnacle of civilization
with incredibly modern infrastructure, robust economies, substantial
international trade, great healthcare, and a rising middle class.
globe, Europeans were living out short, mud-filled, brutish lives
in squalid poverty, dying off by the thousands from the bubonic
plague. They were practically Neanderthals compared to the Chinese,
and explorers like Marco Polo wrote fanciful tales of wealth and
opulence in the east.
If you had
told a Chinese merchant at the time that, over the course of the
next several hundred years, global primacy would shift to Europe
(and a relatively unknown American continent), you would have been
laughed at. It was simply unthinkable given how advanced China was
over the west.
And yet, it
happened. History shows us that the great things about western civilization
(Industrial Revolution, technological achievement) and the not-so-great
things about western civilization (imperialism, slavery, genocide)
caused the tables to turn and primacy to shift from east to west.
the tables are turning yet again, and its driven by a number of
At the tail
end of World War II, a new global financial system was concocted
that was heavily biased to disproportionately benefit the United
States. Over the subsequent decades, foreign countries would obligingly
mop up US government largess and finance out of control retail consumption.
It got to the
point where people felt it was a natural right of Americans to have
huge homes, cheap gas, and oodles of junk, as well as a government
that could buy anything it wanted without giving a second thought
to fiscal discipline. Much of this was made possible at the expense
of peasant workers overseas.
they imported US inflation and suffered a tremendous disparity in
standard of living, all because of how the global financial system
was set up. This system, based on the United States as the center
of the economic universe, is now completely fractured, and its
the biggest game changer in centuries.
Is it possible
that such a force can be stopped or reversed? Highly unlikely.
sea changes in the global order happen slowly, like titanic ships
changing course in a tight canal. The initial seeds of change were
planted decades ago when the US began running consistent budget
deficits in the early 1960s, and even before that when the Federal
Reserve Act was passed in 1913 (which forever corrupted the nations
momentum has been building for an exceptionally long time. Todays
debt, inflation, and unemployment crises are merely the latest symptoms
of a cancer that has been growing for decades.
In total objectivity,
the patient is beyond cure at this point
and the math is quite
the rest of the article
June 14, 2011
© 2011 Sovereign Man