Where liberty is, there is my country.
Debt is any enemy of government’s perfect ally. The more a government borrows the more it’s weakened. The consequences of debt, required repayment of principal, and compounding interest are inexorable, forestalled by central bank and government machinations but never prevented. The longer they forestall the more severe the consequences. Central banks and governments have fostered the world’s greatest debt bubble and promoted negative interest rates to facilitate it. An unprecedented tsunami of debt has creditors paying borrowers to lend them money. This weird and anomalous combination, impossible in a world without central banking, portends global disaster.
The enemies of government have only to wait. When the reckoning arrives, governments will find they no longer have the means to wage war or control their populations (see “The Illusion of Control,” and , Robert Gore, SLL ). Their demands on their nations’ productive taxpayers and their depreciation of currencies have stripped their countries of their wealth and ability to produce. Be it by creditors, revolutionaries, or invaders, or some combination of the three, these governments will be toppled and replaced by something new. It’s a story as old as human history.
A graph of global economic growth versus the much steeper graph (in both percentage and absolute terms) of global debt growth above it conveys an obvious message: something has to give. When that something gives it will lead to the greatest deflationary depression in history. The trillions in fiat debt that governments and central banks will conjure in response will be no match for the quadrillions (one quadrillion equals one thousand trillions) in debt, unfunded liabilities, contingent liabilities, securitized collateralized-debt, derivatives, and other promises—all counted as a liability or quasi-liability on one set of books and an asset or quasi-asset on another—that will unravel and implode.
Governments are meeting the ongoing economic and financial crisis—whose “official” start will probably be placed at the 2008-2009 implosion, but whose roots stretch back to at least 1971, when Nixon closed the gold window—the same way they always have: stealing incomes and wealth, keeping for themselves or giving to favored recipients, issuing debt, “encouraging” or outright forcing their central banks to buy that debt, and debasing their currencies. This bag of larcenous and fraudulent tricks produces nothing, leads to no voluntary, mutually beneficial trade, and retards savings and investment, the foundations of economic growth and progress. It is how Herbert Hoover and Franklin Roosevelt turned what should have been a garden variety recession and financial reset into the Great Depression.
It is why a Greater Depression is at least ten years on and the worst is yet to come. Anyone who doubts that we’re in this Greater Depression should reflect on one fact: across the developed world national governments’ debts are growing faster in both percentage and absolute terms than government-calculated gross domestic products. In other words, the “growth” we now have is more than completely offset by the greater growth of those national governments’ debt. The disparity yawns even wider when growing individual, corporate, and political subdivisions’ debts—which mostly fund consumption and so generate no offsetting return—are added to national governments’ debt.
One positive thing about the Greater Depression going forward is that it will hit an inflection point and its pace will dramatically quicken. That inflection point will be crashing equity and debt markets, heralding the depression’s severe economic contraction. Default, bankruptcy, and deflation will be the order of the day and much of what the world now considers wealth—debt and equity claims, title to land and tangible assets pledged as collateral for multiple loans—will simply evaporate.
Broken promises, vanishing wealth, and contracting economies will inevitably lead to social disorder and chaos, which severely resource-constrained governments will be unable to control or contain. Current political arrangements and geographic boundaries will not survive the stress, with larger entities shattering into smaller ones. The parasitic monstrosities that are today’s governments will be unsupportable. Future generations will look back in wonder that they were able to expropriate so much of the world’s production and wealth while being responsible for so much of its misery.
Necessity is the mother of invention and inventive thinking. Collapse will lead not just to a wrenching political, economic, and financial reordering, but an epochal reset in human thought. Most of what most people now believe will be seen as tragically wrong. Today’s impervious-to-facts-or-reason worship of governments, rulers, and their minions will certainly stand revealed as the folly it’s always been.
Sand is sand until somebody figures out how to make glass, semiconductors, and solar panels. For centuries petroleum was considered a nuisance. It didn’t become valuable until somebody discovered its constituent elements could be used for, among other things, light, heat, and powering internal combustion engines. Gold was just another rock until humanity discovered its many virtues, which make it ideal for, among other things, jewelry, microcircuitry, and money (see “,” Robert Gore, SLL).
A resource, natural or otherwise, is a resource because it has at least one use. Resources are not the ultimate source of wealth, the minds that discover uses for them are. Very few wealth-creating ideas are tabula rasa, without antecedent. They build on prior discoveries and ideas. Innovation, when allowed to proceed, is a compounding, exponential process, creating new possibilities that lead to more innovation. It epitomizes organic adaptation, the bottom-up, decentralized progress that humanity makes when it’s not smothered by its diametric opposite—top-down, centralized command-and-control.
Reality-based intelligence, competence, and innovation will be prized as the world is forced to organically adapt to economic collapse, entropic decentralization, and much smaller political subdivisions. Those who would build new societies will need builders. Engineers, scientists, entrepreneurs, farmers, plumbers, electricians, mechanics, carpenters, computer programmers, machine-tool operators, doctors, technicians, etc.—people who know how to do useful things—will find their skills, ingenuity, and industriousness in demand. Politicians, bureaucrats, lobbyists, lawyers, crony-socialist executives, administrators, college professors, think tank propagandists, criminals, celebrities, safe-space students, perpetually aggrieved whiners, a menagerie of misanthropic misfits, the indolent, the entitled, etc.—people with little or no useful skills—will be so much disposable baggage. Ironically, within this latter group there are numerous proponents of population reduction. Without an exercisable claim on the talents and production of the former group, they may well find themselves at the head of their own line.
The first question those who would found new societies may ask is: What must we do to attract the builders? The proper question will be: what must we not do to attract the builders? For once builders will be in the driver’s seat, and it’s not difficult to imagine their answers. They’d like to hold on to what they earn, so forget theft under the euphemism of taxation. Why should they fund senseless wars or the lifestyles of people they neither know or care about, and probably despise? Bye-bye warfare and welfare states. Forget the frauds of fiat debt, legal tender laws, and central banking; individuals and markets will decide the accepted medium or mediums of exchange.
Builders don’t cotton to people who know less than they do about their occupations telling them what to do, so you can toss hundreds of thousands of laws, regulations, and codes out the window. As a matter of fact, they don’t particularly like other people telling them what to do, period. Isn’t there an ancient parchment somewhere that says: ? What must be done to attract the builders? Leave them alone to pursue their happiness!
As the world splinters into a thousand or more enclaves, they will be experiments into what works and what doesn’t, confronting two basic issues: supporting their populations and defending themselves. The most successful at the former will undoubtedly be the most successful at the latter because both stem from a common source—productive human minds that are free to innovate, produce, and voluntarily cooperate and exchange, and thus have a stake in defending what they build from armed invasion, parasitic immigration, and internal corruption and subversion. The multiplicity of enclaves will give builders the option to leave failing ones and find or start ones more to their liking.
When humanity proceeds from one epoch to the next, there are usually precursors within the prior epoch of what’s to come in the next one. Hong Kong after World War II offers a glimpse of what’s possible in the coming age of decentralization. It is smaller than Rhode Island, has a population roughly equal to Washington State’s, and no natural resources other than the natural shelter and deep waters of Victoria Harbor, which enabled the construction of one of the world’s leading ports. Yet, in a span of fifty years it went from scattered farming and fishing villages emerging from Japanese occupation to a commercial and financial powerhouse with one of the world’s highest concentrations of both skyscrapers and ultra high-net-worth individuals.
It capitalized on capitalism, which unleashed the skills, ingenuity and industriousness of Chinese immigrants fleeing Communist China, attracted to its low taxation and minimal government interference in the economy. Hong Kong is, of course, a nightmare to all those bleating about wealth inequality. The lower bound on wealth is zero, the upper bound in a Moore’s-law world where science, knowledge, and technology are exploding exponentially virtually infinite. Such will be the gap in the new era’s most successful enclaves, with their dramatically reduced or nonexistent taxes and minimalist or nonexistent governments. The bleaters will be apoplectic, well-advised to find an enclave of their own kind to shelter themselves from the horror—someplace where everyone is poor, but equally so.
Hong Kong is also a nightmare to all those statist collectivists who insist that freedom is impractical and can’t work in the present day and age. What they really mean is that individual rights, self-interest, market competition, voluntary interaction, and free exchange among builders can’t work, but force and fraud can, as long as they’re on the business end of the guns and the checks are made out to them. A bankrupt world plunging toward ruinous chaos is the end result of barrel-of-a-gun political power. It is only the power to stymie, stop, cripple, enslave, corrupt, plunder, destroy, and murder. If people cannot handle freedom for themselves, they sure as hell can’t handle power over other people. If the last century has demonstrated nothing else, it has demonstrated that. Just consider the bloodbath perpetrated by the author of the barrel-of-a-gun quote.
Imagine a group of several million people from around the world signing a petition to the United Nations or whatever global governance organization the globalists foist on us. They ask for a small area, say no bigger than Rhode Island, or maybe Rhode Island itself, in which they are allowed to set up their own country and live in freedom, with a minimalist government or no government at all. They volunteer to pay the expenses for anyone who doesn’t want to live in Freedomland to move to the location of their choice.
If you’re shaking your head at the impossibility of such a proposal, are you doing so because people could never live together in freedom or because the world’s powerful would never allow it? The former answer involves such a dim view of human nature it’s a wonder those who believe it even get out of bed in the morning. The latter answer is based on a clear understanding of the world’s powerful.
Mel Gibson shouted it in Braveheart: Freedom! It’s an ideal that’s animated the best of humanity for centuries, the discussion of which is the first thing repressive regimes censor. If discussion is impermissible, then a real-life test of that which they hate and fear is out of the question; its success would be an irrefutable reproach to their professed politics and their psychopathic psyches. Freedom and tyranny can’t live under the same roof. The chaos and violence engulfing Hong Kong was foreordained in 1997. Gibson was drawn and quartered.
However, the dinosaur—predatory government—faces its extinction. Those who worship and those who hate state power both sense that titanic forces are at work, that earthshaking changes are coming. Real power, the power to create, invent, build, and produce—the power of the mind—awaits its full liberation. The war for freedom will be bloody and chaotic, but it’s a war that must be fought…and won.
On the other side of that valley, havens will emerge in which humanity is finally free to reach its vast, glorious potential. That’s worth fighting for.