Use access key #2 to skip to page content.

Larry Summers telling them their troubles are over. (If I were Larry, I'd start thinking about a move to some place like the Canary Islands.)

Recs

14

August 07, 2009 – Comments (12) | RELATED TICKERS: GS , C , JPM

Hunky DoryBy James Howard Kunstler
on August 3, 2009 7:36 AM    
     Whenever the herd mentality lines up along a compass point leading to "permanent prosperity," or a yellow brick road lined with green shoots, or something like that, I tend to see the edge of a cliff up ahead. We are now completely in the grips of the deadly diminishing returns of information technology.  The more information comes to us about How Things Are, especially from TV, the more confused or wrong the conventional view gets it.
      A broad consensus has formed in the news media and among government mouthpieces and even some "bearish" investors on the street that "the worst is behind us" in this tortured economy.  This view is completely crazy.  It will only lead to massive disappointment a few weeks or months from now, and that disappointment might easily transmute to political trouble.  One even might call the situation tragic, except a closer look at the sordid spectacle of what American culture has become -- a non-stop circus of the seven deadly sins -- suggests that we deserve to be punished by history.
     The reason behind this mass delusion is not hard to find: it's based on wishing, especially the wish to retain all the comforts, conveniences, luxuries, and leisure that had become normal in American life.  These are now ebbing away in big gobs for most of the population -- while a tiny fraction of the well-connected pile on ever larger heaps of swag, enjoying ever more privilege. Those in the broad bottom 95 percent were content as long as there was a chance that they, too, could become members of the top 5 percent -- by dint of car-dealing, or house-building, or mortgage-selling, or some other venture enabled by easy credit and a smile.  Those days and those ways are now gone.  The bottom 95 percent are now left with de-laminating houses they can't make payments on, no prospects for gainful work, re-po men hiding in the bushes to snatch the PT Cruiser, cut-off cable service, Kraft mac-and-cheese (if they're lucky), and Larry Summers telling them their troubles are over. (If I were Larry, I'd start thinking about a move to some place like the Canary Islands.)
     Too many disastrous things are lined up in the months ahead to insure that we're entering a new phase of history: The Long Emergency.
     Government at every level is worse than broke.
     Our currency, the US dollar, is hemorrhaging legitimacy.
     Inability to service old debt at all levels or incur new debt.
     Bad (toxic) debt lurking off balance sheets everywhere.
     The housing bubble fiasco is far from over.
     Commercial real estate fiasco just getting started.
     Unemployment rising implacably.
     So-called "consumers" unable to consume consumables.
     Crucial energy import supply lines fragile.
     Food supply subject to energy problems and climate abnormalities.
     A world full of other societies who would enjoy watching us fail and suffer.
     When The Long Emergency was published in 2005, I said then that the greatest danger this society faced would be its inclination to gear up a campaign to sustain the unsustainable at all costs -- rather than face the need to make new arrangements for daily life.  That appears to be exactly what has happened, and it didn't happen under the rule of some backward-facing, right-wing, Jesus-haunted crypto-fascist, but rather a "progressive" party led by a dynamically affable young man unburdened by deep cultural allegiance to Wall Street. Barack Obama has been sucked in and suckered.  "Change you can believe in" has morphed into "a status quo you will bend heaven and earth to hold onto."
     Whatever else you might think or feel about Mr. Obama's performance so far, this strategy on the broader question of where we go as a nation pulses with tragedy.  What's remarkable to me, to go a step further, is the absence of comprehensive vision -- not just in the president, but in all the supposedly able and intelligent people around him, and even those leaders not in government but in business and education and science and the professions.
     History is clearly presenting us with a new set of mandates: get local, get finer, downscale, and get going on it right away. Prepare for it now or nature will whack you upside the head with it not too long from now.  Attempting to maintain anything on the gigantic scale will turn out to be a losing proposition, whether it is military control of people in Central Asia, or colossal bureaucracies run in the USA, or huge factory farms, or national chain store retail, or hypertrophied state universities, or global energy supply networks.
     These imperatives are so outside-the-box of ordinary experience right now, that to drag them into the arena of politics can only evoke blank stares or nervous giggling. But whether we like it or not, these are the things that will really matter in the years ahead -- not whether General Motors can ever make a profit again, or what Target Store's sales figures are next quarter, or whether the latest high-rise condo-and-gambling complex in Las Vegas will be successfully marketed.
      Here, in the dog days of summer, it seems to me that the situation in the USA is so fundamentally bad, so unpromising, so booby-trapped for failure, that I wonder if there has ever been a society so badly deluded as ours.  We're prisoners of our wishes, living in a strange dream-time, oblivious to the forces gathering at the margins of our vision, lost in a wilderness of our own making.
     Anything can happen now.  I certainly wouldn't rule out international mischief as we arc around into fall.  The air is so full of black swans that the white swan now seems like the exceptional thing. Whatever else happens, it sure will be interesting to see the public's reaction to Wall Street's announcement of Christmas bonuses.  The folks at Rockefeller Center better be thinking about getting a fireproof tree.
____________________
Kunstler's novel of America's post-oil future, WORLD MADE BY HAND, is now available in paperback. I am at work on the sequel. 
    

12 Comments – Post Your Own

#1) On August 07, 2009 at 8:27 AM, alstry (36.38) wrote:

The reason behind this mass delusion is not hard to find: it's based on wishing, especially the wish to retain all the comforts, conveniences, luxuries, and leisure that had become normal in American life.  These are now ebbing away in big gobs for most of the population -- while a tiny fraction of the well-connected pile on ever larger heaps of swag, enjoying ever more privilege. Those in the broad bottom 95 percent were content as long as there was a chance that they, too, could become members of the top 5 percent -- by dint of car-dealing, or house-building, or mortgage-selling, or some other venture enabled by easy credit and a smile.  Those days and those ways are now gone.  The bottom 95 percent are now left with de-laminating houses they can't make payments on, no prospects for gainful work, re-po men hiding in the bushes to snatch the PT Cruiser, cut-off cable service, Kraft mac-and-cheese (if they're lucky), and Larry Summers telling them their troubles are over. (If I were Larry, I'd start thinking about a move to some place like the Canary Islands.)
     Too many disastrous things are lined up in the months ahead to insure that we're entering a new phase of history: The Long Emergency.
     Government at every level is worse than broke.
     Our currency, the US dollar, is hemorrhaging legitimacy.
     Inability to service old debt at all levels or incur new debt.
     Bad (toxic) debt lurking off balance sheets everywhere.
     The housing bubble fiasco is far from over.
     Commercial real estate fiasco just getting started.
     Unemployment rising implacably.
     So-called "consumers" unable to consume consumables.
     A world full of other societies who would enjoy watching us fail and suffer.

HOW CAN SO FEW SEE IT??????????????????????

Report this comment
#2) On August 07, 2009 at 8:34 AM, OneLegged (< 20) wrote:

I happend across a copy of USA Today at the local coffee shop yesterday.  Every account of every aspect of the economy that was covered in that paper refered to the economic troubles in the past tense.  Every one.  The premise being that the economy is well on its way to complete recovery.  Sales are up. earnings are up and unemployment is down!!!!  It was a real eye opener.

Report this comment
#3) On August 07, 2009 at 8:45 AM, alstry (36.38) wrote:

Unemployment rising implacably.

Based on today's numbers, are we only counting certain people?

Report this comment
#4) On August 07, 2009 at 9:51 AM, HighRisk41 (28.77) wrote:

Amen!!!

Oh wait can I say that anymore??? I sure hope I don't offend anyone. 

Report this comment
#5) On August 07, 2009 at 9:56 AM, StopLaughing (< 20) wrote:

Larry is planning on replacing Bernanke. That will be a nice move (LOL).

Report this comment
#6) On August 07, 2009 at 10:02 AM, StopLaughing (< 20) wrote:

Dear Abitare and Alstry:  You are forgetting that you can get Keynsian Econ to work for a while. Things will appear to get better (at least the GDP and maybe the employment #s) before it gets worse.

Your timing is premature.  Give it 1 to 2 years.

Report this comment
#7) On August 07, 2009 at 10:48 AM, JerseyShoreGirl (< 20) wrote:

Great piece .. so full of the truth, it is chilling .. because it all seems so unavoidable at this point.  The reason why so few see it is because we don't have any watchdogs in the mainstream media .. they're all lapdogs to this administration.

 

Report this comment
#8) On August 07, 2009 at 11:01 AM, davejh23 (< 20) wrote:

"...the greatest danger this society faced would be its inclination to gear up a campaign to sustain the unsustainable at all costs -- rather than face the need to make new arrangements for daily life."

How can people argue with this?  How can anyone suppose that artificially inflating our GDP through government spending is a sustainable approach?...that it won't lead to disaster in the end?  While the bears may dominate CAPS (at least the blogging), it seems that people are getting greedy, and it's certainly time to be fearful.

Report this comment
#9) On August 07, 2009 at 8:35 PM, FleaBagger (28.17) wrote:

It's funny that alstry made the first comment. I was just thinking that Kunstler sounds just like alstry, but a much better writer and with more sensible punctuation.

I just wanted to say that I found this to be the most moving part:

[I]t seems to me that the situation in the USA is so fundamentally bad, so unpromising, so booby-trapped for failure, that I wonder if there has ever been a society so badly deluded as ours.  We're prisoners of our wishes, living in a strange dream-time, oblivious to the forces gathering at the margins of our vision, lost in a wilderness of our own making.

Students who know the history of the Fall of Rome know that this is not unprecedented, and they know what happens to a debt-driven, morally and financially bankrupt, self-indulgent society. The "forces gathering at the margins of our vision" are just like the outer pressure of barbarian attacks and inward vacuum of ignorance and moral decay that led Rome inevitably to its collapse. I say inevitably, but it was the willfully ignorant, self-indulgent attitude of the people that made it so. But the knowledgeable could not convince or help the ignorant (see alstry's blog).

You've heard that Rome was not built in a day. Rome did not fall in a day, either. Its long, staggering decline from global superpower status was marked with numerous warning signs of inflation, asset price collapses, and moral outrages that were absorbed by an invincible indolence. It was only the attacks of primitive foreigners that awakened Rome from her stupor, and that only for a little while and never meaningfully.

So this is the modern update. It has new special effects, and we're going through the emperors out of order. But it's otherwise a scene by scene, shot for shot remake. I don't know if the first Macrinus was any good, but I'm really enjoying Obama's portrayal. Watch out when we get to Nero.

Report this comment
#10) On August 11, 2009 at 7:24 PM, alexxlea (44.18) wrote:

The fall of the American Empire in the past tense was actually going to be central to my thesis. This is a wonderful piece. No one knows the reality that we are going to be one of those underdeveloped countries that we've always mocked, and those who do will never admit it till their dying days because fear of the truth begets a mindset that you do not wish to live with every day of your life.

Report this comment
#11) On August 11, 2009 at 7:30 PM, alexxlea (44.18) wrote:

Also of note that perhaps it is not the Roman decline we should look to as a model for our own, though it is a distinct possibility. Also note that the spirit of Roman global superiority morphed to Constantinoble and its economic successes while losing its geographic heart in Italy to distress. That whole situation always reminds me of that fact that the United States of America is essentially the Anglo vestiges of the British Empire and a continuation of the western lineage of dominant world powers.

We are creature of comfort and precious few realize that we were once creatures of necessity. I wish the ugliness of need does not surpass the beauty of humanity that dwells within us when the moment of truth is upon us. 

Report this comment
#12) On August 11, 2009 at 7:51 PM, ffampuero (< 20) wrote:

 A crisis of this magnitude was not produced overnight. The potential solution will not happen overnight either. In the spirit of "immediate results" the voices of doom about Mr. Obama have multiplied and there has yet to be a moment of reflection to understand that the present Government is only 7 months old. However, by reading everyone of the previous comments the outcome is decidedly assured. You people need to travel a bit more, but not to Vegas or Miami, but around the world. Only this way will you able to understand what the USA is, has been and will possibly  continue to be if only it could manage the fear and ignorance that now pervades around the country. The country has been here before and it was able to transcend the times but through hard work, less fear, more collaboration and so much more belief. Listen to each other opine and you would think that "The End is Near". Sad. 

Report this comment

Featured Broker Partners


Advertisement