The two sources of ruin
Inflation is not enough – our self-appointed elite is now getting steamed up for war
“The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists.”
Ernest Hemingway
Once again we have both: inflation and war! Any dope could see that when you lend money at below the going rate of inflation, stymie output with regulations, shutdowns, tariffs, and waste trillions of dollars… and try to make up for lost production with printing press money – you are asking for trouble. We said so (ad nauseam) in these pages.
The Fed doesn’t have many responsibilities. Controlling inflation is Numero Uno. Yet it failed to see the inflation it was causing and misdiagnosed it as “transitory” – now, it has no idea how to get the cat back in the bag. Baby steps of interest rates rising by 25 basis points will never do it. The Fed will be following inflation, not leading it.
Meanwhile, in modern warfare, the generals get their medals and sinecures. Defence shareholders get higher stock prices. The whole military/ industrial/surveillance/think tank/ university/press complex becomes richer and more powerful. So, it is hardly surprising that this huge complex – about which Dwight Eisenhower warned us 60 years ago, and which has only got richer and more powerful since – now wants to get the country steamed up for war.
No change in the deep state
In America, the president changes, the ruling party changes, but the “deep-state” rulers remain the same. So do the key policies. The rich get richer. Spending increases. Debt rises. No agencies are eliminated. No programmes end. If any deep-state apparatchik loses his job, he just bides his time for the next administration.
We’d be a damned fool to argue that there is no difference between Russia and the US. But the differences are not always as clear and stark as we imagine. And the masses will go along with almost any “great cause”. They are the taxpayers, “cannon fodder” for war, and “useful idiots” for the whole elite agenda. Mob man is always ready to back his leaders.
Taken into a private room, shown the facts, all the money spent, all the programmes, all the bureaucrats, do-gooders, spooks and paper pushers, and then handed his share of the bill – the average voter would surely recoil in horror. But he still wouldn’t feel qualified to cast his judgment.
Should the Air Force build a new plane? Should hedge funds be allowed to carry forward their losses? Which side should the US back in Eurasia – those who speak Russian or those who speak Ukrainian? Those questions are beyond his ken. They are for the elite – the experts – to decide.
“Baby steps of 0.25% won’t put inflation back in the bag”