PICTURING COLLAPSE

A particularly disturbing aspect of the accelerating rush to a very possible near-future fiscal collapse of government at all levels – bankruptcy, default, the destruction of the dollar as a currency, the increasing dysfunction of  markets under increasing  loads  of regulations and taxes – is that none of  the potential  Republican  candidates for President in 2012  have provided  a vision that impacts the emotions of this destructive scenario.

People see what things look  like now  — not so bad, even for the worst off if nobody in the U.S. is  starving to death, people still get  their Social  Security checks, etc. — but they are not being warned of what their lives will be like under rapidly approaching desperate conditions that will be very different from now. 

They are not getting a  picture of life in a collapsed U.S.  The frightening reality of a United  States in collapse, with severe economic and political instability, large numbers of destitute people desperate for food and shelter, mobs, rioting and looting, even dead bodies in the streets, on and on, does not make an appearance in the current political  arena.  

All Republicans give you is numbers, like the x fund (Social Security, Medicare, etc.) will run out of money in y years, the amount of the GDP going to pay just the interest on the national debt will be x in only y years.  People are unlikely to be frightened by dry numbers because they can’t imagine what the end results will look  like, so there’s no emotional impact. 

Unless the emotional brain is involved, nobody is going to care enough to seriously consider what needs to be done to avoid disaster.   What is needed for any possibility of change or at least to help people prepare for the (coming soon) unimaginably bad years is for the general public to have a vision that impacts the emotions of what the world of Americans is going to look like in a collapsed America. 

When  the collapse comes, it will happen quickly and unpredictably.  How is fiscal  collapse, the destruction of the dollar and the  collapse of free markets going to change the United States?  What will ordinary daily life be like?  This is not going to be pretty!    

The best picture I can think of for how bad things can get in a collapsing, formerly reasonably prosperous economy is a book on what happened in the German Weimar Republic as a result of the destruction of the mark due to hyperinflation.  That book,  "When Money  Dies: the Nightmare of the Weimar Collapse" is available for $8.00 from Amazon.com. 

It is  an  exceptional book because rather than just tell you about the reality of collapse as a series of changing numbers (such as falling  Gross Domestic Product, increasing Consumer Price Index, increasing national debt, etc.), it actually described in frightening detail what  happened to people’s daily lives, often in the words of those living during the collapse, and including that of the most prosperous.      

For  example, Lady Listowel (Judith, Countess of  Listowel), whose  father  held a senior post in the Hungarian diplomatic service,  commented on distress among the circle of her family’s friends in Budapest during their hyperinflationary period at about the same time as it occurred in Weimar Germany: 

"One  used to  see  the appearance of their flats gradually  changing.  One remembered where there used to be a picture, or a carpet,  or  a secretaire.  Eventually their rooms would be almost empty… In  practice,  people didn’t  just die.  They were terribly hungry, and  relations  and friends  would help with a little food from time to time.  Some of them begged — not in the streets — but by making casual visits  (one knew only too well what they had come for)…  Everyone still tried to keep up appearances at first;  early on, people looked around to see what economies they could make, what clubs to resign from, what luxuries to do without.  Later it was a question of considering what necessities to do without." 

This is what was happening to the affluent!   In  another example (this one recorded by Ernest  Hemingway, who was in Germany at the time, 1923),  a waiter told him,  "We haven’t had any fun since 1914.  If you made any  money it gets no good, and there is only to spend it.  Last year I had enough money saved up to buy a Gasthaus at Hernberg.  Now that money wouldn’t buy four bottles of champagne."    

Another of  the eerily familiar processes reported in the book concerned taxes.  As of August 1923 in Weimar Germany,  the book  reports,  "[s]tatute books on taxation formed a mountain several feet high, and none could tell who was liable to pay what,  when or to whom.  …in human terms, the imposition of unpayable taxes to settle an impossible debt had at last destroyed tax morals at every level of society."    

In the face of all this, the current Republican lineup offering themselves up for President in 2012 is incredibly weak.  Where  is the leader who can vividly depict a frightening future that grabs the public’s emotions while at the  same time, can propose solutions that the public can grasp that can prevent this outcome?

For it is very counterproductive to simply scare folks with portrayals of a dystopian future.  You have to offer hope – not hopey-changey silliness but real solutions.

House Budget Chairman Paul Ryan’s proposed $6.2 trillion cuts in the federal budget is a good start – but our financial situation is so dire that far more radical solutions will be needed, particularly to the Fed’s main entitlement programs.

When a company goes bankrupt, it goes into receivership with its assets sold off to pay its creditors.  Thus we must consider selling the assets of the Federal Government to pay for its debts.

The  Federal government currently owns close to 30% of the land area of the United States, nearly 650 million acres.  Even leftwing environmentalists in Australia are now suggesting (such as in a recent issue of the science journal  Nature,  a pretty left-wing publication;  the  journal’s science is usually good, its politics usually stink) that the less productive of "conserved lands" in Australia be sold to allow  for the protection of more environmentally important  areas.  

There was an idea proposed recently by some Republicans (McCain et al) to sell off certain federal lands previously deemed unneeded  by the Clinton Administration, but the idea is a non-starter because the money raised would simply be set aside in a "fund" and used  to buy more private lands located within national forests. 

This  is just  another example of weak Republican thinking. Why defer to the Clinton Administration’s idea of what federal lands should be sold off and why let the money be used to federalize other more valuable private lands?      

It  would  be possible to sell off enough of this Federal Estate (a land estate never envisioned in the Constitution) each year to pay off the Social Security/Medicare recipients.  Appeals to these politically powerful groups stressing that either the feds sell off these idle lands, most of which have no special environmental qualities as do Yellowstone or Yosemite, or you lose your "benefits" should result in  a very satisfactory, very loud outcry demanding federal land sales. 

These lands, currently doing nothing productive in the hands of the federales, would end up in the private sector and have a  very stimulating effect on economic activity by, for example, allowing development  of  oil, gas, minerals, timber, and other resources.   It  would even make a retreat in the boonies something that would be affordable by middle class Americans.    

As of now, Republicans really don’t have as great a chance of defeating Obama in 2012 as they may  think.   Unless some Republican,  a great communicator, is both able to engage people’s emotions — to shock them out of their complacency — and to provide hope in the form of practical and politically possible new solutions, they are not going to be able to win. 

And, if the Republicans (meaning the right kind of Republicans) don’t win in 2012,  then the risk of the U.S. ending up in a disastrous  fiscal collapse will become a virtual certainty.   

 Emma Peel is a  scientist, economist, laissez faire capitalist, and dedicated troublemaker.