Every economic indicator shows the U.S. economy is still in trouble; still declining. The promise of “green shoots” seems false. And yet, the American people seem strangely calm. Am I the only one who thinks it’s almost “too quiet”?
On June 10th, California’s state Controller John Chiang warned that if California didn’t find some additional and extraordinary source of funds within 50 days (by August 1st), California’s state government would suffer a “meltdown”. Mr. Chiang didn’t define “meltdown,” but he had to be talking about a catastrophic event wherein the California state government would be so impoverished that it would be unable to continue overpaying all of its employees and providing at least some welfare to poor Californians.
California’s financial problems can be traced, in part, to political disputes and grandstanding by various California politicians. But those problems can also be traced more fundamentally back to our federal government which—in the name of “global free trade”—has slashed our tariff barriers, passed treaties like NAFTA, GATT and WTO, and thereby caused many of our industries to relocate to third-world countries to take advantage of cheap labor.
Note that this “cheap labor” is primarily physical labor and that the industrial jobs that were shipped overseas were primarily “physical” jobs.
Our federal politicians justified “global free trade” by promising that after shipping many of our industries and industrial jobs overseas, our economy would enter a “post-industrial” phase where most Americans would have service jobs like system analysts, hi-tech repairmen and mortgage application specialists. The idea of a pollution-free, service-based economy was beguiling. None of us would work hard. Few would get dirty. In essence, we’d all be paid to just shuffle each other’s paper applications for jobs, dental insurance and mortgages.
Unfortunately, the idea of a service-based, post-industrial economy is idiotic. In the real world, if you don’t work, you don’t eat—and “work” ultimately means that you must produce some tangible things like food, clothing, automobiles, homes, dishwashers or computers. Yes—every economy has need for some “service” jobs—but an economy that does not primarily produce tangible “things” cannot prosper and will inevitably suffer exactly the kind of financial collapse that currently threatens the U.S. and California economies.
When (thanks to gov-co “globalists”) our industries relocated overseas, they took the physical jobs that are generally most suitable for “poor people” who may lack the intelligence, education or psychological aptitude required to hold a “service” job or work in a corporate cubicle. The majority of America’s poor are good and decent people who may lack the qualities necessary to be system analysts, but are nevertheless quite capable and entitled to work physically in an industrial facility. They are perfect for assembly line jobs and driving a forklift in the warehouse—and there’s nothing wrong with this. In the end, these “poor” people have a right (or at least a reasonable expectation) to the kind of jobs that they are best able to do.
In fact, after WWII, thanks to high tariffs and American industry, such people earned a good living, bought homes, raised their families and were largely content. But starting in the 1990s, gov-co forced many of their industrial (physical) jobs overseas, and thereby deprived these people of the very kind of physical jobs that they were best able to do. Deprived of many of the “physical” jobs and unable to perform “service” jobs, these poor people were essentially abandoned by gov-co to welfare, crime (drug dealing & prostitution) and (for the most adept) civil service. (In fact, at the same time our industries were taking our physical jobs overseas, state government employment was rising dramatically across the country. Gov-co was taking the “best and the brightest” of the poor and teaching them to be bureaucrats.)
Insofar as the feds drove many of the “physical” jobs out of the U.S. (and coincidentally, allowed millions of illegal aliens to enter to compete for whatever physical jobs remained), it’s not unreasonable that government should be obligated to provide these jobless poor with welfare. And make no mistake—I’m no liberal. I’ve never sought nor advocated welfare. But when the government—for its own un-American, globalist reasons—drives the people’s jobs out of the country, that government has an obligation to provide the people with enough welfare to continue to survive. Or, failing to do so, that government must reasonably expect the poor to do what anyone else would do when they can’t find work or food: rob, riot and plunder.
Which brings me back to Controller Chiang’s warning of a California “meltdown” sometime after August 1st.
If and when such “meltdown” takes place, the California state government will stop providing many services. But virtually no state services go to the rich—so the rich won’t be directly affected by a state government “meltdown”. Relatively few state services are intended for the middle class, so the middle class will also escape with direct injury. However, because state services are primarily intended for the poor—the poor will be adversely and disproportionately affected by a California government “meltdown”.
So—what do you suppose will happen if California turns off the welfare machine? Can we reasonably expect that the poor—deprived of both physical jobs and welfare—will at least take to the streets to demonstrate? Of course.
Next, note that California’s “meltdown” is predicted to take place in the mid-summer. Summer is America’s riot season. No one riots in the winter—it’s too cold. Few riot in spring or fall. But a long, hot summer can provide an environment that’s ideal for both wildfires and fiery riots.
Then—note that some estimate that there may be 250,000 gang members in southern California. (These are often the sons and daughters of poor parents who can no longer find adequate “physical” jobs because the genius globalists have shipped many of those physical jobs to China and India.) Some believe these So-Cal gang members are not merely armed better than the local police—but may be better armed than some U.S. infantry platoons.
Lessee. First, we’ve got a financial meltdown that may deprive the poor of their welfare. Second, we’ve got roughly 250,000 highly-armed gang members (sons and daughters of poor people). And, third, “It’s summertime, summertime, sum-, sum-, summertime.” Does it take a genius IQ to see these three ingredients and conclude that California just might be heading for a truly “riotous” summer?
It would reportedly take about $26 billion to balance California’s books. President Obama’s not sending one cent. However, Governor Schwarzenegger didn’t ask for $26 billion. Because California’s credit rating is so low, the “Governator” merely asked that the Obama administration “co-sign” for a loan of lousy $5.5 billion to get California though the summer (a/k/a the wildfire and riot season). Obama refused.
I find President Obama’s refusal to assist California shocking. Disturbing. Frightening. Isn’t the Democrat party the one that’s supposed to help the poor? Isn’t President Obama seeking a Supreme Court candidate who has some “special sensitivity” to the problems of poor people? Can’t Obama see what may happen if the California poor are deprived of both jobs and welfare?
California has the nation’s biggest single-state population. California has the biggest state economy (bigger than all but a handful of the world’s nations). California is big.
In the last nine months, the federal government has spent over $1 trillion to “bail-out” a number of Wall St. financial firms, banks and corporations that were deemed “too big to fail”. How is it that California (our most populous state and biggest state economy) is not also “too big to fail”?
How can the federales justify giving most of $1 trillion to Wall St. but not even $5.5 billion to California? $1 trillion is $1,000 billion. California needs $5.5 billion (about 1/200th of $1 trillion) to make it through the summer (riot) months. Surely, the feds can see that California is facing a potentially explosive situation that could end in looting, fires and even widespread deaths.
So why not provide California with a lousy $5 or $10 billion to at least reduce the probability of summertime riots?
It’s insane to refuse to provide those funds. It’s like playing Russian Roulette with real bullets and real lives. By refusing to help California, President Obama does not merely risk real catastrophe—he seemingly encourages such catastrophe.
And California’s not alone. North Carolina, Mississippi, Indiana, Arizona, Illinois and Pennsylvania all also have multi-billion dollar deficits—though none to compare in size to California’s. Still, all of these states may also be entering the “Summer of Their Discontent” with insufficient funds to pacify the poor.
It’s estimated that the total state deficits are about $240 billion—only about one-fifth of the sum the feds have already pumped into Wall St., some banks and corporations. And I guarantee that the states would shout with joy if the feds would provide just half of their deficits—$120 billion—which would be just one-tenth of bail-out money so far spent on corporate entities “too big to fail”.
And yet President Obama refuses to assist.
How can this be?
When you consider the summer season, the likely reaction when the poor are deprived of welfare and the dangerous consequences of rioting, I find the fed’s refusal to help frightening.
Why?
Because, under these circumstances, the refusal to send funds makes absolutely no sense. It is irrational. It is insane.
Unless . . . unless the fed’s want a massive riot . . . unless the feds want a pretext (like 9/11) to pass some act or do something so unthinkable that it would be politically impossible except in the context of a dire emergency.
Suppose riots break out in California. What are the odds that similar riots would also break out in other states unable to provide sufficient welfare? What happens if summertime riots break out in two, three, or more American cities?
Under the pretext of multiple riots, could the Obama administration stampede Congress into passing another “emergency” bill without even reading it? Answer: Absolutely—that’s already been done repeatedly (the Patriot Act after 9/11, the bail-out bill of A.D. 2008 and the recent “cap and trade” bill). It can be done again.
If so, what sort of bill might we expect? Three possibilities come to mind:
1. Gun Control. If LA is populated by 250,000 armed gang members, we can reasonably expect to see a lot of people (including police) die from gunfire in a widespread LA riot. Could such fatalities provide sufficient pretext to pass a draconian gun control bill? Maybe—but I doubt it. More precisely, while such law might be passed, I doubt that any such law is likely to be easily enforceable. I don’t believe that any pretext will be sufficient to persuade Americans to voluntarily surrender their firearms. And government should have brains enough to avoid passing laws they can’t enforce without widespread voluntary compliance. (But if government should have some brains, how do you explain the G.W. Bush administration?)
2. Bank Holiday. Economist Bob Chapman (International Forecaster) has predicted that a “bank holiday” may be planned for this summer. If so, such “holiday” could be easily justified under the pretext of multiple summer riots. Such “holiday” would probably accompany a significant devaluation of the American currency.
3. Default. LEAP/E2020—a highly-respected European think tank—has warned that “on the eve of summer 2009, the question of the US and UK capacity to finance their unbridled public deficits has become the central question of international debates, thus paving the way for these two countries to default on their debt by the end of this summer.” It would probably be easier for gov-co to default on its debts while the American people were distracted by TV coverage of widespread rioting.
4. ??? At least some of the people in Washington DC are not only smarter than me but even sneakier. I wouldn’t be surprised if they used the pretext of multiple riots to pass any number of bills on subjects that I can’t yet imagine.
More, California Controller Chiang’s June 10th prediction of meltdown after August 1st may have been overly optimistic. California is already sending out over 28,000 “IOU’s” to Californian’s who expected to receive a state income tax refund. Plans are afoot to send similar “IOU’s” to state government vendors, contractors, municipalities and even students expecting student aid checks. People will receive IOU’s now with promises of hopefully being paid later—perhaps next fall.
How do you suppose the IOU recipients are going to react? Almost all common Americans are in a state of financial stress. Most are living hand-to-mouth. Virtually all IOU recipients were counting on receiving a negotiable check rather than an IOU. For some, these IOUs will result in mortgage foreclosures, losing homes, cars, utilities. You know that many of these people are already desperate. You have to know that many will be infuriated by the IOUs. Angry people tend to riot.
It’s enough to make me laugh like an undertaker. It’s a perfect storm. What do you suppose those college kids will do if their student aid checks are replaced by “IOU’s”? Some college kids live to riot. The only reason many of ‘em go to school is for a chance to “act out”. California may soon give them their chance. And note that once a riot starts for any reason, for no reason, it can quickly escalate—just like a wildfire—into widespread destruction and death.
I am not predicted that the college kids will riot. But I am saying that when conditions are conducive to riots, it’s at least foolish (and perhaps suicidal) to create a series of separate flash points (poor, taxpayers, college kids, or (as I write this) even Michael Jackson’s SRO funeral, etc.) that might incite such riots.
Therefore—rather than having a financial “meltdown” in early August (as suggested by Controller Chiang) and possible riots later that month—it’s not impossible that California could see riots as early as mid-July (the “ides” of July) as reaction to its “IOUs”.
But—who can say? Maybe the riots can be delayed until August, or September or even early October. With luck, we might not see any riots at all.
However, while summer riots can’t be predicted with certainty, the probability of summer riots might occur has been increased by the states’ financial deficits and the feds’ almost incomprehensible refusal to help.
Again—the feds’ refusal to hand out a relative pittance to the states—seems so irrational that I can’t help but be suspicious. Why won’t the feds help? Any fool can see that these circumstances at least increase the chances of riots.
To me, it seems so easy for the feds to reduce the probability of riots by simply distributing a mere $50 billion to the states, that I can’t avoid a frightening conclusion: the feds want riots.
And if they want ‘em, you can bet we’re gonna have ‘em. You can bet that if the feds want riots as pretexts for draconian laws or as distractions from defaults, there will be agent provocateurs who will ensure that, come the Ides of July (or maybe August or maybe September), devastating and catastrophic riots do take place.
Again, I’m not predicting summer riots. I’m simply describing what seems to me to be a chain of “logic”. That logic suggests, first, that the Obama administration’s seemingly irrational refusal to aid the states will increase the probability that riots might take place; and second, if Obama’s refusal is not irrational, then it may be intended to precipitate such riots.
I hope I’m wrong. I hope the riots don’t take place. I hope our federal government is not sufficiently treasonous to precipitate riots.
But if my chain of “logic” makes any sense to you, then now—right now—might be a very good time to insure that you are fully prepared for the “Ides” of July, August and September. How are you fixed for food? Water? Guns? Gold?
Buckle up.
