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Tuesday, January 21, 2014

The Influenza Deception

Guest Post By Brandon Turbeville

With the latest round of hysteria regarding the prevalence of the annual flu season and the “need” for the flu vaccine in full swing, one unaccustomed to reading the details of government statistics and the arguments for or against vaccination might justifiably be terrorized into running to their local vaccine dispensary and rolling up their sleeves. Indeed, the average person encountering the reports of infection, hospitalization, and death will justifiably be stirred into a frenzied state of panic.

The vaccine makers, pharmaceutical companies, and their representatives also known as medical doctors, are, of course, waiting with open arms and needles locked and loaded. With statistics such as “hundreds of thousands” of infections and “tens of thousands of deaths” by the flu virus being repeated ad nauseam, it is understandable why many hapless individuals rush to take toxic vaccines unaware of the hazardous ingredients they contain.

However, what is scarcely examined is whether or not these numbers quoted by mainstream media outlets and the medical industry are, in fact, accurate. Indeed, in most cases, these numbers are simply repeated by various players with little or no adequate challenge ever mounted against them.

Yet, upon closer examination, the statistics being repeated by these outlets are revealed to be nothing more than propaganda. While the flu virus might not be something to ignore, the truth is that the apocalyptic predictions and bio-panic reports constantly shoveled out to the American population are much smaller both in terms of infection and mortality rates.

These vastly reduced amounts of infection are clearly evident when one evaluates the actual numbers of infection confirmed to be caused by the flu virus itself.

First, it is important to point out the difference between Influenza (Flu) and Influenza-like illness. Both the flu and flu-like illnesses reveal themselves by the manifestation of the same symptoms, i.e. fever, runny nose, headache, body aches, etc. Both are caused by viruses. However, the flu is caused, logically, by the influenza virus of which there are three different types (A,B, and C) while flu-like illness is caused by a variety of other viruses.

Unfortunately, the majority of individuals who manifest these symptoms and who make a trip to their medical doctor are diagnosed with the flu, with no further testing to confirm this diagnosis. Thus, while medical doctors and their patients might believe they are witnessing an influx of flu patients, the reality may be that none of these individuals actually have the flu, but, instead, they may be infected with a flu-like illness.

For instance, one need only take a look at the statistics compiled by the CDC (Centers for Disease Control and Prevention) to understand that the flu is not the culprit of an annual genocide lurking behind every corner and on the hands of every sniffling person.

The following data lists the year, the number of tested cases of sickness, and the percentage of those tested that turned up positive for the flu, respectively.

1997-1998 99,072 13.05%[1]

1998-1999 102,105 14.21%[2]

1999-2000 106,768 15%

2000-2001 88,598 11%

2001-2002 100,815 15.5%

2002-2003 96,871 11%

2003-2004 130,577 18.9%

2004-2005 157,759 14.9%

2005-2006 179,772 12.1%

2006-2007 179,268 13.2%

2007-2008 225,329 18%

2008-2009 195,744 14%

2009-2010 157,449 21%

2010-2011 256,399 22%

2011-2012 234,456 12%

The average percentage rate of flu virus infection during the 15 years between 1997 and 2012 is 15.05%.*[3]

Clearly, as one can see from the data above, the hype surrounding the flu virus is hyperbolic to say the least. The worst flu season in 15 years yielded just a 22% infection rate, while many of the other years yielded significantly below that. 2002-2003, for instance, only had an 11% infection rate.

Thus, for the last fifteen years, the flu infection rate hovers around 15%; meaning that approximately 85% of the people who believe they have the flu or are diagnosed with the flu, do not have it at all. These statistics mean simply that 85% of the population diagnosed with the flu actually have a flu-like illness, not the flu itself.

Also note that the years with the highest rate of infection (2009-2011) were the two years of and immediately following the H1N1 Swine Flu panic that resulted in the mass vaccination of millions of people the world over. Considering that the potential for the seasonal flu vaccine was demonstrated to actually increase susceptibility to the H1N1 Swine flu, one would be justified in wondering whether or not it was actually the vaccine that caused the slight uptick in infection rates for those years.

Nevertheless, since the virulence and spread of infection of the flu is vastly lower than what is claimed by the medical industry and media outlets, the question then becomes whether or not the virus is particularly deadly when one is actually infected by it. Thus, it is once again important to look at the numbers.

The official statements coming from the CDC claim that, on average, 36,000 people die each year from the flu. 36,000 is indeed a frighteningly large number, despite the fact that they themselves strike a stunningly low number of the population as a whole.

However, there are once again issues with the actual numbers of flu deaths when those numbers are broken down. First, it is important to remember that flu deaths are lumped together with pneumonia deaths every year. Second, it is also known that flu deaths are often statistically combined with flu-related deaths for propaganda purposes. Much like intentionally confusing the cases of the flu with cases of flu-like illness, compounding flu deaths with flu-related deaths or pneumonia deaths, serves only the purpose of causing panicked stampedes toward vaccination by the general public are being assaulted with the massaged and manipulated numbers.

By lumping flu and pneumonia deaths together, the propagandists in the medical and pharmaceutical industries as well as in corporate media outlets are able to provide a number in the realm of staggering proportions, somewhere in the range of 50,000 to 60,000 depending on the year. Yet, in order to determine how many individuals were killed by the flu as opposed to pneumonia, a separation of the numbers must take place.

Thus, if the medical industry’s claims of approximately 36,000 dead from the flu each year are true, that would mean that slightly to well over half of the initial total of 50,000 to 60,000 provided would have been caused by the flu itself. This assumption, however, is wholly incorrect as it rests on the factual accuracy of the CDC’s claims of 36,000 dead from the flu every year.

To be fair, medical researchers claim the reason they lump flu and pneumonia deaths together in their final reports is due to the possibility of secondary pneumonia infection as a result of the flu. However, as mentioned above, it is quite possible to tell whether or not the deaths recorded were due to pneumonia as well as whether or not they were flu or flu-related.

Interestingly enough, the CDC itself admits that even influenza-related deaths (not only deaths that were caused solely by influenza), are drastically lower than the amounts paraded in front of the public. On its own website the CDC states, “only a small proportion of deaths in either of these two categories are estimated to be influenza-related. CDC estimated that only 8.5% of all pneumonia and influenza deaths and only 2.1% of all respiratory and circulatory deaths were influenza-related.”

With these numbers in mind, if we take the 60,000 deaths estimated to have been caused by Pneumonia and Influenza, the death rate would hover at or around only 5100 (slightly more or slightly less), not 36,000. Keep in mind, even the term “influenza-related” is a very loose and statistically generous term. The CDC defines “influenza-related” by stating the following: “Seasonal influenza-related deaths are deaths that occur in people for whom seasonal influenza infection was likely a contributor to the cause of death, but not necessarily the primary cause of death.” This definition allows for the attribution of death to be labeled as “influenza-related” even when influenza is not the cause or even a contributing factor simply because of its presence in a terminally ill or dying person.

Because the CDC has been much less forthcoming with the data regarding flu deaths or even influenza-related deaths, the exact numbers of influenza-related deaths are difficult to determine. From searching the CDC website, the only readily available set of numbers that directly referenced the number of influenza-related deaths came from the year 2009-2010 which listed the number of deaths at 2,125.

However, the National Vaccine Information Center compiled a chart of Pneumonia and Influenza deaths dating back from 1940 and ending in 2010. The deaths are separated by those attributed to Pneumonia and those attributed to Influenza. Nevertheless, it should be pointed out that the deaths attributed to the flu are in fact influenza-related deaths, not deaths directly attributed to the flu virus. The numbers for the years 1998 - 2010 are listed below.

1998 720

1999 1,724

2000 1,665

2001 257

2002 727

2003 1,792

2004 1,100

2005 1,812

2006 849

2007 411

2008 1,722

2009 2,918

2010 494

With this in mind, when examining the confirmed cases of death confirmed to have been caused by the flu, the average number is generally much lower than 36,000 flu deaths per year cited by medical “experts.” Yet the numbers listed above include “Influenza-related” deaths, not flu deaths directly traced back to the flu itself. In fact, the real numbers of flu death are vastly lower than even 1,000 people per year. In the last fifteen years, not one flu season has been recorded as having contained even 100 flu deaths during the course of one year.

Indeed, in the last fifteen flu seasons, only 216 people have died as a result of the confirmed flu.

This is quite a different breakdown of flu deaths than that which is presented in media reports. For this reason, it is important to note that either pneumonia or some other illness is responsible for the other deaths included in the calculations. A drop from 36,000 dead to, in some cases, single digit figures is the result of an overwhelming misrepresentation of the facts to say the very least.

Thus, with the above information in mind, it is important to take a closer look at the statistics. Below are listed the last 15 flu seasons with the number of dead who are tied directly back to the flu. As you can see, the numbers are hardly cause for panic.

1997-1998 6

1998-1999 13

1999-2000 9

2000-2001 7

2001-2002 7

2002-2003 31

2003-2004 18

2004-2005 19

2005-2006 18

2006-2007 13

2007-2008 16

2008-2009 43

2009-2010 16

2010-2013 Data unavailable

Very little can be added to the statistics as presented above beyond pointing out the misleading and false nature of the propaganda machine operated by the pharmaceutical, vaccine, and medical industries via their mouthpieces in the mainstream corporate media , particularly regarding the nature of the dangers of the flu virus and the need to vaccinate.

For too many years, the American people as well as the people of the rest of the world have been stampeded into to taking toxic injections and dangerous vaccines in order to protect them from a highly inflated bogeyman.

While the flu is no laughing matter, the projection of it as the new Black Plague that will kill us all is the opposite of what is needed to improve public health. The overwhelming majority of people who are diagnosed with the flu only have a flu-like illness to begin with. Regardless, even if you contract the flu, it is important to remember that well below 100 people die of the virus every year.

Thus, as the hype and hysteria ramp up at the beginning of flu season and continue throughout the subsequent months, it is helpful to remember the numbers and statistics provided in this article, so as to avoid succumbing to the panic such propaganda is attempting to produce.

To an unvaccinated person, Flu season does not equal imminent death, a justification for panic, or even a reason to be overly concerned (assuming that person has a healthy immune system and other commonsense health precautions have been taken).

To a vaccinated person, however, the dangers from lurking viruses may be the least of their worries.
2008-2009 1,557

2009-2010 2,125


[1] Tenpenny, Sherri. “Flu And Flu Vaccines: What’s Coming Through That Needle?”

[2] Tenpenny, Sherri. “Flu And Flu Vaccines: What’s Coming Through That Needle?”

[3] Please note: These numbers were a result of the calculations of the figures provided by the CDC and two sets of numbers as calculated by Dr. Sherri Tenpenny. These numbers, although accurate, should be taken as an approximation. The actual numbers may be slightly higher or lower by a measure of hundredths or tenths of decimal points. These numbers, however, can be confidently used as a representation of the amount of flu infections during these years.

Recently by Brandon Turbeville
Brandon Turbeville is an author out of Florence, South Carolina. He has a Bachelor's Degree from Francis Marion University and is the author of six books, Codex Alimentarius -- The End of Health Freedom, 7 Real ConspiraciesFive Sense Solutions and Dispatches From a Dissident, volume 1 and volume 2, and The Road to Damascus: The Anglo-American Assault on Syria. Turbeville has published over 275 articles dealing on a wide variety of subjects including health, economics, government corruption, and civil liberties. Brandon Turbeville's podcast Truth on The Tracks can be found every Monday night 9 pm EST at UCYTV.  He is available for radio and TV interviews. Please contact activistpost (at)

Thursday, January 16, 2014

Who Has The Time And Motivation to Comprehend The Mess We're In? Almost Nobody


Guest Post by Charles Hugh-Smith of OfTwoMinds blog,

If we don't understand the problem or the dynamics that are generating the problem, it is impossible to reach a solution or practical plan of action.

When it comes time to assess our grasp of the dynamics of this unprecedented era, how do you reckon historians will grade our collective political "leadership," intelligentsia, central state, corporate leadership and the "common man/woman" citizen? Did we rise to the occasion or did we falter, not in acting to counter the dissolution of the Status Quo, but in simply making a concerted effort to understand the tangled web of lies, corruption, perverse incentives, unintended consequences, simplistic (and utterly misguided) ideologies, not to mention the real-world limits of a supposedly limitless world, that have become the key dynamics of this era?

I suspect future historians (presuming the funding of such scholarly assessments survives) will grade all categories either F or D-. The reasons are not difficult to discern, and it behooves us to understand why we are collectively so ill-prepared to understand our era, much less fix what's broken before the whole over-ripe mess collapses in a heap.

1. Intellectual laziness. Very few people are willing to work hard enough to figure things out on their own. It's so much easier to join Paul Krugman dancing around the fire of the Keynesian Cargo Cult, chanting "aggregate demand! Humba-Humba!" while waving dead chickens than ditch reductionist, naive ideologies and actually work through an independent analysis.

2. Independent thinking is an excellent way to get fired, demoted or sent to Siberia. Though America claims to value independent thinking, this is just another pernicious lie: what America values is the ability to mask failing conventional ideas and systems with a thin gloss of "fresh thinking."
In other words, what the American state and corporatocracy value is the appearance of independent thinking, not the real thing. Since the real thing will get you fired, everyone who works for government or Corporate America masters the fine arts of producing simulacra, legerdemain and illusion. This only further obscures the real dynamics, making legitimate analysis that much more difficult.

3. Relatively few have any incentive to question authority, the state or the corporatocracy. Humans excel at figuring out which side of the bread is buttered, and who's lathering on the butter: self-interest is the ultimate human survival trait (we cooperate because it serves our self-interest to do so).

While we cannot hold the pursuit of self-interest against any individual--after all, who among us truly acts selflessly when push comes to shove?--we can monitor the monumentally negative consequences of self-interest and complicity on the systems and Commons we share.

When roughly half of all households are drawing direct cash/benefits from the central state, how many of those people are interested in doing anything that might put their place at the feeding trough at risk? Sure, people will grouse about this or that (usually related to the conviction that they deserve more or have been cheated out of "their fair share"), but as long as the government payments, direct deposits and benefits keep coming, what possible motivation is there for the recipients to devote energy to investigating the potential collapse of the gravy train?

Corporate America is no different. The store may be devoid of customers, but the employees will strive to look busy to keep the paychecks coming until the inevitable lay-off/implosion occurs. How many Corporate America employees will critique their way out of a paycheck? In an environment this difficult for job-seekers, you'd be nuts to bother figuring out why your division is failing, knowing as you do that the truth will result in the "termination with extreme prejudice" of the naive fools who presented the truth as if it would be welcome
Does anyone seriously imagine that any employee of a bloated bureaucracy will ever voluntarily challenge the squandering of revenues when that might cost them their own paycheck, bonus, contract for their brother-in-law, etc.? A few protected people (professors with tenure, for example) can be "brave," but their "bravery" is cheap: their protestations cannot trigger termination with extreme prejudice, so the gesture of resistance is just that, a gesture.

4. Those relative few who might have a real motivation to undertake independent analysis have little time to pursue this noble project. They are working absurd hours and enduring absurd commutes. Between getting the bundles of diapers into the elevator and planning what to cook for dinner, there is precious little time or energy left for figuring out the mess we're in. Just getting to a second or third job can suck up a significant amount of time, money amd energy.

And so the busy employee/sole-proprietor/contract worker listens to NPR or some talk radio program for a few minutes, reinforcing their ideology of choice, and turns on the "news" (laughably bad propaganda churned up with "if it bleeds, it leads") as background noise and spends whatever personal time they have on Roku, Netflix, Facebook, Twitter, email, etc. seeking distraction or solace from the daily workload.

In a strange irony, there are plenty of citizens who have plenty of time (recall that Americans manage to watch 6-8 hours of TV a day), but their marginalized status and dependence on the state drains them of motivation to do anything but seek amusement and distraction.

If we don't understand the problem or the dynamics that are generating the problem, it is impossible to reach a solution or practical plan of action. In other words, the four points above doom us just as surely as the dynamics of insolvency, corruption, debt servitude, Tyranny of the Majority, etc. etc. etc.

Choose your metaphor of choice, but rearranging the deck chairs on the Titanic has a nice ironic texture in an election year, when the "news" will be focusing on rearranging the political deck chairs on the first class deck--at least when there's no celebrity ruckus or "if it bleeds, it leads" to crowd out what passes for "hard news" in a regime dedicated to the distractions of bread and circuses. 

Tuesday, January 14, 2014

We Will Be Told Hyperinflation Is Necessary, Proper, Patriotic, And Ethical

Guest Post by Patrick Barron via The Ludwig von Mises Institute,

Hyperinflation leads to the complete breakdown in the demand for a currency, which means simply that no one wishes to hold it. 

Everyone wants to get rid of that kind of money as fast as possible. Prices, denominated in the hyper-inflated currency, suddenly and dramatically go through the roof. The most famous examples, although there are many others, are Germany in the early 1920s and Zimbabwe just a few years ago. German Reichsmarks and Zim dollars were printed in million and even trillion unit denominations.

We may scoff at such insanity and assume that America could never suffer from such an event. We are modern. We know too much. Our monetary leaders are wise and have unprecedented power to prevent such an awful outcome.

Think again.

Our monetary leaders do not understand the true nature of money and banking; thus, they advocate monetary expansion as the cure for every economic ill. The multiple quantitative easing programs perfectly illustrate this mindset. Furthermore, our monetary leaders actually advocate a steady increase in the price level, what is popularly known as inflation. Any perceived reduction in the inflation rate is seen as a potentially dangerous deflationary trend, which must be countered by an increase in the money supply, a reduction in interest rates, and/or quantitative easing. So an increase in inflation will be viewed as success, which must be built upon to ensure that it continues. This mindset will prevail even when inflation runs at extremely high rates.

Like previous hyperinflations throughout time, the actions that produce an American hyperinflation will be seen as necessary, proper, patriotic, and ethical; just as they were seen by the monetary authorities in Weimar Germany and modern Zimbabwe. Neither the German nor the Zimbabwean monetary authorities were willing to admit that there was any alternative to their inflationist policies. The same will happen in America.

The most likely trigger to hyperinflation is an increase in prices following a loss of confidence in the dollar overseas and its repatriation to our shores. Committed to a low interest rate policy, our monetary authorities will dismiss the only legitimate option to printing more money — allowing interest rates to rise. Only the noninflationary investment by the public in government bonds would prevent a rise in the price level, but such an action would trigger a recession. This necessary and inevitable event will be vehemently opposed by our government, just as it has been for several years to this date.

Instead, the government will demand and the Fed will acquiesce in even further expansions to the money supply via direct purchases of these government bonds, formerly held by our overseas trading partners. This will produce even higher levels of inflation, of course. Then, in order to prevent the loss of purchasing power by politically connected groups, the government will print even more money to fund special payouts to these groups. For example, government will demand that Social Security beneficiaries get their automatic increases; likewise for the quarter of the population getting disability benefits. Military and government employee pay will be increased. Funding for government cost-plus contracts will ratchet up. As the dollar drops in value overseas, local purchases by our overextended military will cost more in dollar terms (as the dollar buys fewer units of the local currencies), necessitating an emergency increase in funding. Of course, such action is necessary, proper, patriotic, and ethical.
Other federal employee sectors like air traffic controllers and the TSA workers will likely threaten to go on strike and block access to air terminal gates unless they get a pay increase to restore the purchasing power of their now meager salaries.

State and local governments will also be under stress to increase the pay of their public safety workers or suffer strikes which would threaten social chaos. Not having the ability to increase taxes or print their own money, the federal government will be asked to step in and print more money to placate the police and firemen. Doing so will be seen as necessary, proper, patriotic, and ethical.

Each round of money printing eventually feeds back into the price system, creating demand for another round of money printing ... and another ... and another, with each successive increase larger than the previous one, as is the nature of foolishly trying to restore money’s purchasing power with even more money. The law of diminishing marginal utility applies to money as it does to all goods and services. The political and social pressure to print more money to prevent a loss of purchasing power by the politically connected and government workers will be seen as absolutely necessary, proper, patriotic, and ethical.

Many will not survive. Just as in Weimar Germany, the elderly who are retired on the fruits of a lifetime of savings will find themselves impoverished to the point of despair. Suicides among the elderly will be common. Prostitution will increase, as one’s body becomes the only saleable resource for many. Guns will disappear from gun shops, if not through panic buying then by outright theft by armed gangs, many of whom may be your previously law-abiding neighbors.

Businesses will be vilified for raising prices. Goods will disappear from the market as producer revenue lags behind the increase in the cost of replacement resources. Government’s knee-jerk solution is to impose wage and price controls, which simply drive the remaining goods and services from the white market to the gangster-controlled black market. Some will sit out the insanity. Better to build inventory than sell it at a loss. Better still to close up shop and wait out the insanity. So government does the necessary, proper, patriotic, and ethical thing: it prints even more money and prices increase still more.

The money you have become accustomed to using and saving eventually becomes worthless; it no longer serves as a medium of exchange. No one will accept it. Yet the government continues to print it in ever greater quantities and attempts to force the citizens to accept it. Our military forces overseas cannot purchase food or electrical power with their now worthless dollars. They become a real danger to the local inhabitants, most of whom are unarmed. The US takes emergency steps to evacuate dependents back to the States. It even considers abandoning our bases and equipment and evacuating our uniformed troops when previously friendly allies turn hostile.

And yet the central bank continues to print money. Politically-connected constituents demand that it do so, and it is seen as the absolutely necessary, proper, patriotic, and ethical thing to do.

Friday, January 10, 2014

Six Reasons Why The Government Is Destroying The Dollar

 Guest Post by Daniel R. Amerman, CFA

The United States government has six interconnected motivations for destroying the value of the dollar:

Six Reasons Why The Government Is Destroying The Dollar
  1. Creating money out of thin air on a massive basis is all that stands between the current state of hidden depression, and overt depression with unemployment levels potentially rivaling those seen in the Great Depression of the 1930s.
  2. It is the most effective way to not just pay down current crushing debt levels using devalued dollars, but also to deal with the rapidly approaching massive generational crisis of paying for Boomer retirement promises.
  3. It creates a lucratively profitable $500 billion a year hidden tax for the benefit of the US government — a tax which is not understood by voters or debated in elections.
  4. It creates a second and quite different form of hidden taxation by way of generating artificial market highs, which while non-existent in inflation-adjusted terms, do create artificial investment profits that are fully taxable and highly profitable for the US government.
  5. It is the weapon of choice being used to wage currency war and reboot US economic growth; and
  6. It is an essential component of political survival and enhanced power for incumbent politicians.
In this article we take a holistic approach to understanding how individual short, medium and long-term pressures all come together to leave the government with effectively no choice but to create a significant rate of inflation that will steadily destroy the value of the dollar over time.
If you have savings, if you rely on a pension, if you are a retiree or Boomer with retirement accounts — any one of these six fundamental motivations is by itself a grave peril to your future standard of living. However, it is only when we put all six together and see how the motivations reinforce each other, that we can most effectively seek personal solutions.
Reason One: The Political Interests of Self-Serving Politicians
Even after the major tax increases of about $400 billion a year that took effect at the end of 2012, almost 5% of the US economy is still currently funded by deficit spending. From a political perspective, this approximately $750 billion a year in borrowed money is “free money” that politicians often get to disburse on a political district and favored special interest group basis. In other words, roughly $650 per month per above-poverty line American household can be used to reward friends — and can be withheld from enemies — with personal credit being taken by the benevolent politicians for this never-ending largess.
In past decades, politicians were restricted to spending perhaps $200 or $300 per month per household over and above what the government was collecting in taxes, with the difference being borrowed in the bond market. Anything above that would require the unpleasantness of raising taxes, which might put individual politicians in danger of actually losing their position and privileged lifestyle if he or she weren’t in a “safe” district. However, in the current climate all limitations are gone, the pork is rolling out on a historically unprecedented basis, and the politicians are wielding unprecedented power.
So why do the limitations usually exist on at least some level, and why are they gone now? Historically, the US government had directly created money out of thin air on a massive basis to fund deficit spending during the Civil War, and also during the Revolutionary War. There is a very good reason such governmental actions are so rare: the value of the US dollar was rapidly destroyed in both instances. So, this spending without limit would not ordinarily be a sensible path. Unless, from the government’s perspective, there were other dangers that were considered a greater threat, and that could be addressed only through destroying the value of the dollar.
Reason Two: To Hide a Depression
(I have written numerous articles about various aspects of Reasons Two through Six for some years now, and my long-term readers and subscribers have been well aware of the building pressures. While the emphasis of this article is on the interweaving of the short, medium and long-term relationships between the six reasons, we will first set the stage by taking a few paragraphs each to briefly review the individual government motivation, with a link to a full length article that covers the problem in more depth.)
While you wouldn’t know it from government press releases or media headlines, there has been a gaping hole in the US economy since 2008, as illustrated below:

Crowding 1

During the first round of the Financial Crisis in 2008 and 2009, the US private sector nearly collapsed, threatening to send the US economy straight into deep depression. We’re talking about a $1.3 trillion private sector collapse that was contained only by the government fantastically increasing the money it spent, even while tax revenues were falling. Indeed, the creation of huge government deficits has been all that has maintained even a facade of semi-normalcy. Remove that mechanism, and it is straight to official Great Depression-level unemployment in months.
Even as the true gravity of the situation is hidden from the general public, so too is the true cost of the grossly irresponsible short-term “band-aid” that is being used to cover the hole in the US economy. The destruction of the value of savings in general, as well as the impoverishment of Boomers and retirees in particular, is explained in my article linked below, “Hiding A Depression: How The US Government Does It.”
Reason Three: A Desperate Attempt to Escape Depression By Waging Currency War
The US government has been waging currency war since September of 2010. Simply put, the US would have great difficulty emerging from depression so long as the US dollar were “strong”, because a strong dollar translates to “expensive” US workers who have difficulty competing for market share even in the US economy, let alone abroad. So one reason for a nation intentionally slashing the value of its currency is that its workers become relatively cheaper, enabling them to not only better defend their domestic market share, but to begin to take market share in foreign economies as well. However, when a major player goes on the currency offensive, many trading partners will counterattack in the attempt to defend their own economies, not by making their own currencies stronger, but by weakening them — so that their domestic workers remain relatively inexpensive and will be better able to compete for market share.
To successfully maintain and increase the power of this currency offensive while negating attempted counterattacks, the Federal Reserve chose a radical weapon in the form of QE3 — which began with the public announcement that it would be directly creating money on a massive scale equal to 6% of the US economy indefinitely, with the proceeds going to purchase US government debt and mortgage-backed securities in the secondary markets. Ultimately, the only protections for a symbolic currency such as the US dollar are the policies deployed by the Central Bank to maintain that value. And when the nation’s chief central banker directly threatens to use his power to destroy the symbol, rather than preserve it — the threat is extraordinarily effective.
QE3 has been highly successful in reducing the value of US currency relative to both Europe and China. However, Japan has counterattacked with the new Abenomics, a particularly potent form of quantitative easing which has been quite successfully pushing down the value of the yen versus the rest of the world, thereby ratcheting up Japanese export profits.
There is no free lunch, however. While the US government is insisting to the world-at-large that it is not engaged in currency warfare, in order to maintain the plausible deniability that is essential to diplomatic doublespeak, it is also hiding the heavy cost from its own citizens. The US standard of living since the late 1990s has been based on having a “strong” dollar and huge trade deficits — meaning we haven’t actually been able to pay for what we consume for a long time. Therefore, even as jobs and the real economy grow, there is a drop in the overall standard of living, which is not evenly weighted, but is disproportionately borne by savers, Boomers and retirees.
A deeper exploration of how this works, including the specific ways that older citizens are — and will continue to be — the primary victims, can be found in my article linked below, “Bullets In The Back: How Boomers & Retirees Will Become Stimulus, Bailout & Currency War Casualties”.
These second and third components of hiding a depression and waging currency war are tightly interwoven, and could even be called “killing two birds with one stone”. The money doesn’t exist to keep the US from openly plunging into depression, it simply isn’t there for a fiscally responsible government. And covering the economic hole by creating money out of thin air at a rate equal to 6% of the total US economy is so fiscally irresponsible, that few nations dare a counterattack of such magnitude. So for now, massive monetary creation allows the US to not only cover over the current hidden depression, but also to wage all-out currency war to try to emerge from that depression.
While boosting employment is an important motive behind currency warfare, to better understand the agenda of the US government, we’ll next explore the greatest financial problem of all, and how destroying the value of the dollar is the intended solution.
Reason Four: Dodging National Bankruptcy
Sometimes households reach the unfortunate point where when they add up the credit cards, mortgage payments, and second mortgage payments — they realize that they will never be able to pay their bills. They know they are bankrupt and there is no way of dodging it. But instead of reducing their spending — they may actually ratchet it up, until all the lines of credit are maxed out, and the bills are all in arrears. Because once bankruptcy is inevitable anyway, why slash your standard of living before you absolutely have to? Partying it up for another few months won’t change the destination, so why not?
Fortunately, relatively few ordinary people are so irresponsible as to think that way. There is ample evidence, however, that a good number of politicians hold that mindset when it comes to budget deficits that appear impossible to repay, at least in the conventional manner.
There is a pervasive myth that is being frequently repeated, which is that our children and grandchildren will be slaving away for decades to pay back the money that we’ve been borrowing to fund this reckless deficit spending. The assumption behind the myth is that were it not for the current spending, the nation would be fine, and therefore increased taxes will be needed to pay back these borrowings over the decades to come.
Except that the nation wouldn’t be fine. For like most other major developed nations in the world, the United States has been effectively bankrupt for quite some time, with a day of reckoning that is approaching fast — with or without the current outrageous level of deficit spending.
The graph below is from my article, “Six Layers Of Deficit Impossibilities Mean Retirement Catastrophe”.

L deficit 6

As developed step by step in “Six Layers “, when we add up current and future federal deficits, as well as unfunded Social Security, Medicare and other unfunded government promises, the total comes to over $785,000 per non-retired household over the coming years that has an above-poverty line income.
And this actually isn’t even the total cost — it is the excess cost over and above current estimated tax receipts, with those estimated receipts being based on the assumption of a healthy and growing economy. When we drop the assumption of an economy growing at the same rates of the last 50 years, then the shortfall goes far higher — perhaps to over $200 trillion for Social Security and Medicare alone by some recent estimates. That would raise the total shortfall to over $2 million per non-retired and above-poverty-line household.
If taxes can’t pay (and it’s ludicrous to think they can), and the US doesn’t declare bankruptcy, then just how do we cover the gap?
Short answer: pay in full, but make the dollar worth five cents. This drops the per household cost for everything from almost $800,000 down to about $40,000. Painful, but manageable over a period of 20-30 years.

Bailout Lies 10

Merely make a dollar worth five cents, and those seemingly impossible government promises become quite payable. The problem with this “solution”, however, is that it also requires making most people’s life savings worth five cents on the dollar.
Reason Five: Create a Massive Hidden Tax
The Federal Reserve effectively controls short, medium and long-term interest rates in the United States, and this means that it controls the borrowing costs of the United States government. As developed in my article linked below, “Hiding A $500 Billion Tax On Savings: How The Government Deceives Millions” , by forcing interest rates below the rate of inflation, the Federal Reserve creates about a half trillion dollar per year “windfall” gain for the federal government.

Save Tax 6

This is not “free money”, far from it — for every dollar that the government takes in from interest rate manipulations comes directly out of the pockets of savers. That is, for the government to come out ahead by $500 billion per year requires savers and pension funds to come up short by $500 billion per year. This makes it a tax — in all but name. It is also essential to note that two elements have to come together to make this hidden tax work: 1) there have to be low interest rates, and 2) there also has to a substantive real rate of inflation (which can be quite different from the official rate).

Save Tax 9

From a politician’s perspective, this massive tax — almost three times the size of federal corporate taxation — is a “dream tax”. Half a trillion dollars a year is available to spend without overtly raising taxes or increasing deficits! Sure, there is a cost, which is the entirely deliberate destruction of retirement dreams and promises for tens of millions of US workers and retirees — particularly Boomers — as well as pushing forward the insolvency of state and local government pension funds around the country. But the deliberate bankrupting of a generation is a long-term problem with no clear accountability and almost no voter understanding, which means it is more or less irrelevant for how political decisions are made today.
Reason Six: Taxing Inflation As Income
Let’s consider three market scenarios when viewed from a governmental tax collection perspective.
1) Falling Markets. If investment markets such as the stock market are falling — then on average, rather than generating taxes for the government, they result in tax deductions, as investors write off their losses. Falling asset values are disastrous for government budgets, because falling investment markets act to reduce government tax collections.
2) Level Markets. If markets are on average neither rising nor falling but going sideways — then while tax deductions are not being generated on a net basis, neither are total tax collections. While this is a better scenario for the government than falling markets, it is still quite problematic for tax collection in general, because one of the primary sources of tax revenues — particularly from the more affluent portion of the population — ceases to exist.
3) Rising Markets. There is nothing like a good bull market to rapidly increase government tax collections. Investors all across the country are ratcheting up their tax payments, and rising markets also tend to generate frequent short-term trading, which means that many of those tax collections will be at the lucrative (for the government) short-term bracket level. It is no coincidence that the only US government surpluses in recent decades occurred at the height of the tech stock bubble, with the often frenetic short-term trading (at short-term tax rates) that was a part of it.
If governments didn’t have a means for turning level or falling markets into rising markets — this three-part relationship could be a huge problem, particularly with a struggling economy.
Fortunately for the government — and very unfortunately for investors — there is a very powerful weapon which can turn falling or level markets into rising markets, while radically increasing investment tax revenues. This weapon is inflation, the destruction of the value of the dollar, and it has generated enormous hidden tax revenues for the US government ever since the United States went off the gold standard in 1933.
While these hidden inflation taxes are very well understood by governments and economists, the average voter and investor is not even aware of their existence. To help address this knowledge gap, I have prepared two resources, linked below.
“Could Misleading Theory And Jargon Threaten Your Net Worth?” is an easy to follow, illustrated tutorial which shows how the destruction of the value of money can be used to cover over the destruction of the value of assets — even while generating substantial false “income”, which is fully taxable even though it doesn’t exist in after-inflation form.

Jargon A 03
Jargon A 05

As developed in the article, when it comes to the largest components of household net worth for American households, for the 22 out of 40 years analyzed — the destruction of the purchasing power of assets was being (successfully) hidden from the public.

Stealth 06

As shown in the graph above, and developed in my article, “Stealth Taxes Consume Stock Gains & Retirement Plans”, about 94% of taxes paid on stock price gains held between 1997 and 2012 weren’t actually paid on real income — but rather on inflation. That is, for every $1 of taxes on “real” or after-inflation income, the government was collecting $17 in taxes on phantom income — which had been created by the rate of inflation.
It is difficult to overstate the importance of inflation to the government when it comes to both the level and the reliability of investment tax collections. With no inflation in the mix, it all comes down to the economy and the luck of the markets. And in any given year, falling markets could generate increased tax deductions that could cripple government revenues.
Even a moderate annual rate of inflation, then (whether included in official government inflation estimates or not), is enough to skew investment tax returns strongly in the government’s favor. And of course the higher the rate of inflation, the more powerful the financial advantages to the government of this long-standing tax, which as the US government knows quite well from eight decades of experience — most voters don’t understand.
The Convergence of the Six Overwhelming Governmental Motivations
The Long Term
Let’s add our six powerful motivations together and see how they interrelate. The truly big picture for both the United States and most other major developed nations is that population growth has been shrinking, while long-term promises to current and future retirees will be enormously expensive to fund, and for the most fundamental of demographic and economic reasons, the nations simply can’t afford to pay for those promises.
On a global basis, governments are left with a choice between breaking promises openly – reneging on their legal commitments on a massive scale, possibly having to actually declare bankruptcy in many cases (effectively) – or they can follow the time-honored route that almost every nation which has found itself in the situation and has had the ability do so has done:  they can pay their promises in form, but not in substance. They can inflate away the value of their national currency, and pay everything in full, but that currency will only be worth a fraction of what it is right now.
So the larger the future shortfall, the more overwhelming the motivation to destroy the value of the currency, and the greater the degree of destruction of the currency that is necessary in order to turn impossible promises into possible promises.
This is particularly the case when inflation not only reduces the real expenses (in after-inflation terms), but also increases the real income.  The higher the real rate of inflation (which is not the same thing as the official rate), then not only the lower the real size of the required payments to beneficiaries, but the higher the collection of hidden taxes in the forms of both Financial Repression and inflation taxes.  Thus, the gap is closed from both directions.
The Short Term
Let’s look at the short term in the United States. As previously discussed, there is currently a gaping hole in the US economy that is equal to about 5% of its size if we look to official deficits, and about 8% if we include the hidden $500 billion tax on savings.  This economic hole in the private sector is being covered over by overt deficit spending and hidden taxation, which in combination account for about one in every twelve dollars spent in the nation this year.  If this 1-2 combination of deficits and hidden taxation were to cease abruptly, and taking into account the millions of unemployed who are being effectively hidden by changes in workforce participation rates, then the US risks going straight to a Great Depression-level of unemployment.
So, if you’re in the political establishment and you don’t want outright political revolution, then you have enormous incentives to try to keep an appearance of normalcy in the economy through spending vast sums of money that can’t be paid for by taxes, and running up endless deficits to keep the facade of a healthy economy, no matter how much damage you need to do to the long-term value of your nation’s currency.
Tying Together Long Term & Short Term
Short term interests are served by recklessly risking the long-term value of the nation’s currency, thereby providing the funding to cover over the hole in the economy.  Long-term interests, in terms of impossible government promises that must be inflated away, are served by the destruction of the value of the nation’s currency. The more severe this destruction, the less the cost of repaying impossible promises. Arguably then, the more risk that is taken in “papering” over the hole in the current economy, and the more severe the long-term consequences, the better off the government will be in the future when it comes to its ability to cheaply repay debts that are otherwise unpayable.
The Medium-Term & The Real Economy
Now, let’s go to the medium term and consider the real world factor that bridges the current economic crisis and the long-term economic crisis. That bridge is ultimately all that really matters, and it is the real economy. Without a powerful and rapidly growing real economy, there is no way out of the hidden depression in which the United States currently finds itself. American workers must be competitive if they are to regain both domestic and international market share (a situation many other nations are in as well).
Mixing Medium & Long Term
Nobody knows the true extent of the trouble the US economy faces over the next ten, twenty and thirty years as Boomer retirement promises come due in full. But we do know that:
1) It would take a historically unprecedented rate of economic growth to meet the promises in current dollars without bankrupting the nation; and
2) The financial devastation could be far, far worse than most estimates if the US economy does not perform like it has historically, but instead continues the downward spiral of a wounded empire that is losing prominence and economic power on the world stage.
When we strip away the standard assumption by the government when making budget projections of endlessly compounded 3% real economic growth, and say that we are either losing economic growth or just breaking even, then the future shortfalls grow even more staggering.  Indeed, when we include the academic evidence of the growth-slowing effects of large government deficits, and then add in the reduction in consumption expected for an aging population, then we may already be in an effectively zero per capita growth mode, as covered in my article linked below, title.

Bridging Medium, Long & Short Term
What the short term and long term both have in common is that the only true solution is ultimately to grow the real economy. The real economy has been hampered since the mid-1990s by a short-sighted “strong dollar” policy that has enormously benefited major international corporations and major banks, while creating a debt-driven illusion of personal prosperity for many of the citizens of the United States.  It’s a standard of living that could never be paid for, but rather was reliant on other nations lending the US the money to fund that lifestyle, so long as we agreed to keep the dollar “strong”. The effective terms were that certain other nations lent us the money to live it up without our being able to pay for the goods that delivered our subsidized standard of living, and in exchange we let them take our industries and jobs.
To re-grow the real economy and regain economic competitiveness, the US must remove the handcuffs on American workers, which requires driving down the value of the US dollar.  This has to be done in a competitive world, where other nations want to defend their own market share by driving down the value of their own currencies. So for the US to be “successful”, it has chosen a strategy of taking more radical actions – in the threat to destroy the value of its currency – than other nations dare counter.
In other words, the other nations aren’t as willing to recklessly and rapidly wipe out the value of their citizen’s savings as the United States is, which gives the US a temporary “advantage” in currency brinksmanship against most of the world (other than Japan, who has taken the competitive currency devaluation lead for now with Abenomics).
Most conveniently, the otherwise-impossible cost of covering over the gaping hole in the US economy can be paid for through open monetization on deliberate, prominent display for the whole world to see.  The strategy is to simply manufacture the money out of nothingness, which then lets the rest of the world know that the US dollar is in grave peril of swiftly diving in value.  This then drives down the value of the dollar, and reboots the real economy and real American competitiveness, even as the hole in the economy is temporarily covered over.
Perhaps most important of all, this begins the rapid destruction of the value of the dollar as necessary to avert formal US bankruptcy when it comes to paying the enormous retirement and health care obligations that are coming due over the next ten, twenty and thirty years.  Even as this higher rate of inflation increases tax collections year after year on a massive basis through using the two distinct types of hidden taxes, which history shows that average voters don’t understand. The equations are simple: 1) no inflation means no hidden tax revenues from Financial Repression and investment inflation taxes; and 2) the higher the rate of inflation, the higher the receipts from hidden taxes which don’t have to be defended in elections.
To understand the true extent of the danger to your savings requires understanding how all three of these levels work together: hiding the depression in the short term, rebooting the real economy in the medium term, and the long-term destruction of the value of the dollar so that tax revenues rise, even while impossible promises are paid in form but not in substance. All three levels effectively require the destruction of the value of the savings of older Americans and retirees in particular. It is your future lifestyle that must be sacrificed for all of these goals to happen together.
Adding In Short-Term Political Benefits
And finally, perhaps not quite as fundamental as the other factors but still significant, there are enormous political rewards for those currently in power when it comes to pursuing this approach.  As covered in my article, “Hiding A Depression”, the government’s share of the US economy swiftly went (with amazingly little commentary) from 35% of the total economy to 43% of the total economy.  In the real world of politics, this growth translated to increased discretionary spending, that (usually) rare commodity that is the currency of pure power.  In normal circumstances, between government transfer payments, the military, and the established bureaucracy, there isn’t all that much discretionary money for politicians to channel for their partisan desires.  That has turned upside down.  Indeed, discretionary money was created so fast that Congress and the Administration initially had trouble figuring out how to spend it.
The government has enormously increased its control over the day-to-day economic life of the nation – not on an altruistic basis, but in the exercise of raw political power.  Politicians have the unprecedented ability, almost without limitation, to take the ~$650 per month per above-poverty line American household in money that is being created out of the void ($1,100 with the hidden savings tax), and to use it to reward their friends and hurt their enemies.  And many are doing so.
The Personal Implications
These six powerful motivations all exist simultaneously, they all wrap around each other in their numerous interrelationships, and they all reinforce each other.  Together they constitute an overwhelming incentive to make sure that a dollar does not remain worth a dollar.
The implications of these six powerful motivations all coming together are that there are multiple compelling reasons to believe that the value of the US dollar (and many other currencies) will be mostly or near entirely destroyed in the coming years and decades. Now, when paper wealth is wiped out for much of the population, and real wealth (goods and services) for a nation has taken a blow, but is not wiped out – then what we necessarily have is a massive redistribution of wealth.  And there is very good reason to believe that the largest redistribution of wealth that has been seen in modern times is likely to be occurring over the coming years.
Inherently, the older that you are – the more likely it is that wealth will be redistributed away from you instead of towards you.  A giant “Reset Button” will likely be pressed for the dollar, and with it – if you have been following the conventional wisdom for retirement investing – the value of savings and investments will likely evaporate.  And if you’re nearing retirement, you may not have that many working years left to recover from the damage, with jobs being difficult to come by even if you want to work.
 So the older compete against the younger – not just for jobs, but for goods and services, where the younger workers have the current income in inflation-adjusted terms to buy these desirable goods – and the older don’t.  Thus, the older citizens become impoverished relative to the younger citizens.  This is a history that has been repeated time and again across nations and across the centuries – it is the pensioners that get nailed when the currency reset button gets pressed.
Making it even more difficult is that the hidden savings tax acts as a giant anchor, making it near impossible for fixed income savers to break even on an inflation-adjusted basis, let alone compound their wealth like all the financial planning models promised.  Simultaneously, the likely reduced economic growth rate associated with a heavily indebted and aging nation will likely slash further stock returns, or even turn them negative in after-inflation and after-tax terms when we consider hidden inflation taxes on investments.
Both of the pillars underlying conventional financial planning have shattered and fallen, which leaves traditional retirement investors with two negative return asset classes (in inflation-adjusted and after-tax terms) that are steadily destroying wealth over the long term rather than compounding it.   Even as the slick investment firm ads featuring vibrantly healthy and wealthy retirees enjoying their active and prosperous retirements, continue to fill the airwaves and financial media.
There are personal solutions. Indeed, there are other schools of investment finance that can handle what is coming, with methodologies that are used by the most sophisticated investors in the world – but they are quite different from the simplistic strategies that dominate both the mainstream and contrarian flavors of personal finance.
The first step is to see what is coming.  Once you see how all six factors work together – you will be able to do something that most people will never do, which is to take personal responsibility for your own future in a deeply unfair world.  Neither the government nor Wall Street are going to bail you out of the mess they have created, and the conventional financial “wisdom” isn’t going to do it either.  You’re on your own, and that means rolling up your sleeves and taking individual actions to protect what you and your family have.
Once you’ve decided to accept this personal responsibility for your future, then you have to be open to changing how you see money and your investments. To find personal solutions, you have to be open to education leading to paradigm change.  When you have that education, and have changed the “lenses” through which you view money and investments – then you can also start to see the professional grade tools that can be used to handle the simultaneous destruction of the value of money, and the value of assets.  Surprising tools found in places you never expected, often without even calling a broker, that can be accessed by most people, and used in a dynamic sequence for the stages of crisis – when we step outside the usual personal finance boxes.
Your financial profile can’t look at all like that of an ordinary older person – or you will share the fate of most older people.  To survive and even thrive in the very different financial environment of this decade and the ones to come, requires changing that profile so that inflation systematically redistributes wealth to you, rather than away from you, and the more of the value of the dollar that is destroyed – the better off you become on an after-inflation basis.

Wednesday, January 8, 2014

Pimping the Empire, Conservative-Style

Guest Post By Charles Hugh Smith

"Conservatives" and "Progressives" alike are pimping for the Empire when they support the Central State's essentially unlimited powers.

Yesterday I described how so-called "Progressives" are pimping for the Empire. The same is true of so-called "Conservatives." (I am reprinting the intro for those who missed yesterday's essay.)

(I say "so-called" because the "Progressives" are not actually progressive, and the "Conservatives" are not actually conservative. Those labels are Orwellian double-speak, designed to mask the disastrous consequences of each ideology's actual policies.)

Let's begin by stipulating that ideology, any ideology, is an intellectual and emotional shortcut that offers believers ready-made explanations, goals, narratives and enemies without any difficult, time-consuming analysis, study or skeptical inquiry. This is the ultimate appeal of ideology: accepting the ideology relieves the believer of the burdens of analysis, skeptical inquiry, uncertainty/doubt and responsibility: all the answers, goals and narratives are prepackaged and mashed together for easy consumption.

This is one of the core messages of Erich Fromm's classic exploration of ideology and authoritarianism, Escape from Freedom.

And what is the essential foundation of authoritarianism? A central state. This is not coincidental.

What few grasp is the teleology of the centralized state: by its very nature (i.e. as a consequence of its essentially unlimited powers), the central state is genetically programmed to become an authoritarian state devoted to self-preservation and the extension of its reach and power.

This is why the Founding Fathers were so intent on limiting the powers of the Central State. They understood the teleology of the centralized state: by its very nature (i.e. as a consequence of its essentially unlimited powers), the central state is genetically programmed to become an authoritarian state devoted to self-preservation and the extension of its reach and power.

You can't cede unlimited, highly concentrated powers to the central state and then expect the state not to fulfill its teleological imperative to protect and extend its powers. The state with unlimited powers will be ontologically predisposed to view any citizen that seeks to limit its expansion of power as an enemy to be suppressed, imprisoned or marginalized.

The state with unlimited powers will be ontologically predisposed to protecting its powers by cloaking all the important inner workings of the state behind a veil of secrecy, and pursuing and punishing any whistleblowers who reveal the corrupt, self-serving workings of the state.

The state with unlimited powers will be ontologically predisposed to view any other nation or alliance as a potential threat, and thus the state will pursue any and all means to disrupt or counter those potential threats.

The state with unlimited powers will be ontologically predisposed to create and distribute propaganda to mask its self-serving nature and its perpetual agenda of extending its powers, lest some threat arise that limits those powers.

Democracy and a central state with unlimited powers are teleologically incompatible.

Though they piously claim to desire a limited State, conservatives cede it essentially unlimited powers because they want that state to be powerful enough to impose their agenda on others and reward their constituencies.

Conservatives are masters at projecting a preachy devotion to a limited state, democracy, liberty and free enterprise while their support of the Central State undermines every one of these values. Conservatives are like the preacher who issues stern sermons on righteousness every Sunday while skimming big money from pimping sordid, destructive policies Monday through Saturday.

Conservatives claim to want to limit the Central State, but their slavish support of Medicare, Social Security, the Pentagon, the National Security State, the Federal Reserve (and thus interest on the national debt), farm subsidies to Big Ag, law enforcement and the War on Drugs Gulag means they support virtually 100% of the Central State's unlimited powers. Their proposed "cuts" are farcically tiny slices designed for propaganda purposes--out of $4 trillion Federal budget, conservatives preach "austerity" while leaving the Empire and their crony-capitalist cartels entirely intact.

Conservatives claim devotion to national defense while actually having no interest in actual defense. Their sole interest is supporting their favored cartels and projecting a politically useful facade of being pro-national defense. In the real world, they support the revolving door between the Pentagon and defense contractors and profitable but ineffective weapons systems. Conservatives happily shove weapons systems down the nation's throat the Pentagon doesn't even want, all the while masking their crony-capitalist agenda behind pious claims of supporting the military.

That is particularly Orwellian: ignore the military's true needs in favor of funneling profits to your crony-capitalist pals. The same Orwellian agenda powers conservative support of the banking sector (conservatives never met a banking subsidy they didn't love), Big Ag, Big Pharma, Big Everything--conservatives will support any Big Business at the expense of the taxpayers and the national commons.

The one essential tool conservatives need to force their crony-capitalism on the citizenry is an powerful Central State--and so they support the essentially unlimited powers of the Central State with gusto, even as they bleat piously about the Founding Fathers.

The Founding Fathers had two primary concerns: foreign entanglements and the dangers of an unlimited Central State. So-called Conservatives are blind to the gap between the reality of their support of a Global Empire and an all-powerful Central State and the fantasy that they even understand the Founding Fathers' concerns, much less actively pursue them.

Conservatives are against Big Government except when Big Government benefits their constituencies. Boost the Pentagon budget by 10% a year, rain or shine, to counter every possible threat to the Empire, boost the National Security State (Homeland Security, NSA, etc.) every year, boost the War on Drugs Gulag annually, leave Medicare, Social Security and interest on the national debt as sacrosanct, and guess what--you've created a self-liquidating monster State.

Behind their preachy facade, conservatives have turned democracy into an auction of political favors. As they belly up to the limitless trough of central State revenues and power, conservatives have embraced the auction as the true mechanism of governance: banking statutes are written by banking lobbyists and then signed into law.

What is the difference between a so-called Progressive who tells us Congress has to pass a crony-capitalist healthcare law to find out what's in it and a so-called Conservative who pushes a banking law penned by lobbyists? There is none: both are pimps.

Once you cede unlimited, highly concentrated power to the central state, you get an authoritarian empire that is driven to protect itself from any threat at all costs--including democracy, though the state may maintain a facade of carefully managed "democracy" as part of its propaganda machinery.

You cannot have a state with essentially unlimited power and not end up with cartel-capitalism. So-called Conservatives defend their favored cartel-fiefdoms, yet these cartels are busy bankrupting the nation and destroying the very bedrock of the liberties Conservatives claim to hold dear.

Once you choose to cede essentially unlimited powers to the Central State, all decisions after that are made in service of the state. The idea that the state can be limited to national defense is illusory.

The only legitimate duties of the state are limited: 1) protect the commons from destruction and exploitation; 2) protect the citizenry from exploitation or oppression by those with superior power or resources; 3) maintain transparency in all governance and 4) maintain a system of sound money.

The so-called Conservatives will learn what the teleology of the state means in the real world when the state comes after them. Once you cede unlimited power to the central state, any attempt to limit that power marks you as an enemy.

Supporting the Central State to protect your favored cartels and protect your political power over the state's tax revenues is simply pimping for the Empire. You can call it "conservative," but it's still pimping for the Empire.

Television news, the stage play

image source

Guest Post by Jon Rappoport

There is a bit of magic to it.

Images sent over thousands of miles, well-lit anchors who seem alert to everything of importance taking place in our world, field reporters in far-flung places who pop up and respond instantly to the anchors and deliver close-up accounts of vital events.

And the same important faces of government leaders who, day after day, are struggling to improve our destiny against great odds, against intransigent enemies of progress.

All this is delivered to us in the space of a few minutes, each night, like clockwork.

The fatuous wall-to-wall lies aside, the news presents that little show of magic which the people sorely need. The need never dies. It’s eternal.

Substitutes for the real thing are acceptable. The television anchors can be obvious oafs, hucksters, cheap con artists; it doesn’t matter.

They can twist the truth, burn it, hide it, step on it, reverse it; it doesn’t matter.

If the US government hires, supports, and arms terrorists, the news can claim the government is doing everything possible to fight against terrorism—including the installation of a massive Surveillance State. The absurd contradictions are simply ignored.

As long as television news gives viewers a small hit of magic, it stays in business. The magic is the stage play, the anchors and reporters are the actors, and the whole show, as it passes into eyes and ears, imparts a dreamlike quality.

Once upon a time, the dream, the magic, the myth were the saddle, reins, and horse of a great personal adventure. But in this modern age, the news stands in as the (brain-addled) knight on his quest for truth and meaning.

In 1927, Carl Jung wrote: “…the dream is the theater where the dreamer is at once scene, actor, prompter, stage manager, author, audience, and critic.”

But for most people, that startling analysis was too much. A single human being staging his own reality? Impossible. The dream and the magic must come from somewhere else, from a place and personage stamped with an official authoritative imprimatur.

There must be The Voice and it must be the news, and it must narrate (invent) the dream.

When this happens on a daily basis, most viewers sink so far into the stage play they fully accept its parameters and remain enclosed.

The space, time, and energy of the play form a continuum that is a prison.

In this prison, viewers are content to “take their magic” from an external source. This is considered safe. This is considered proper. This is considered reasonable. Magic comes to be thought of as always and forever coming from a place that is definitely not-self.

That’s the key.

By extension, speak to people about lost civilizations, hidden archeology, visitors from space—all of which are not-self—and they are eager for more of that magic.

But talk to them about lost continents within the Self, the archeology of the subconscious, the alchemical force of imagination, the creative principle underlying knowledge, their own manufacture of reality…and they tend to back away.

They prefer Small Self to Large Self. They’ve chosen a humble role. That’s the front they want to show to the world.

And society, government, and the news are more than happy to subjugate them to such a role.

And that’s how individual power is replaced and hidden.

When I was a small boy, the stooge for official reality was one of the most respected men in America, Edward R Murrow. He seemed to be talking out of a dark vault. His somber tone, his serious intent, his moonscape rhythms offered doom, but always with a hint of light, because he knew Justice and, therefore, it might still prevail, if good men stepped forward and fought for it.

I can still remember thinking, this is a show, it’s a good show, but it’s theater. I knew that, because in those days my friends and I played on fields of our own choosing, we were free, we made up our own rules and our own games, and we loved having that power.

And then at night, I found my imagination by reading novels about sea voyages and trips to other planets—and soon enough I realized the news was a story about power being everywhere I wasn’t.

It was a losing proposition, from one end to the other.

Fortunately, my other early education was conducted in a local pool room. People who were a lot smarter than I was taught me how to recognize a hustler.

Official reality is a cosmic hustler.

Jon Rappoport is the author of two explosive collections, The Matrix Revealed and Exit From the Matrix, Jon was a candidate for a US Congressional seat in the 29th District of California. Nominated for a Pulitzer Prize, he has worked as an investigative reporter for 30 years, writing articles on politics, medicine, and health for CBS Healthwatch, LA Weekly, Spin Magazine, Stern, and other newspapers and magazines in the US and Europe. Jon has delivered lectures and seminars on global politics, health, logic, and creative power to audiences around the world. You can sign up for his free emails at