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"the money being argued over, shifted around from column A to column B, assigned to this or that actuarial table or budget line or account or obligation or vault or "structured vehicle"- that money is just... not... there."



July 19, 2011 – Comments (3)

The Amazing Dissolving Nation By James Howard Kunstler
on July 18, 2011 10:07 AM

  Going broke fast is a very compelling problem. For ordinary people it tends to induce chicken-with-no-head syndrome - a mad burst of pointless locomotion ending in sudden collapse. If the US debt ceiling is raised - which I think is a 90 percent bet - there will be a sigh of relief that resounds from the lobster pounds of Penobscot Bay to the parking lots of Silicon Valley... and poor dissolving America will still be stuck in its essential predicament of being broke. So a lot of pointless locomotion will continue in the form of positioning among a troop of clown candidates for the dumbshow of the 2012 election. I wonder lately whether that election will actually happen.

Europe is arguably worse off money-wise, more broke, flimsier, crapped out, crippled, and paralyzed. Sad, because in outward appearance Europe  is - how shall I put this? - better turned out than America. Europe is a fit, silver-haired gentleman in a sleek Italian suit and a pair of Michael Toschi swing lace wingtips, holding a serious-looking Chiarugi leather briefcase. America is pear-shaped blob of semi-formed male flesh, in ankle-length cargo shorts, a black T-shirt featuring skull motifs, tattoos randomly assigned (as if by lottery) to visible flesh, a Sluggo buzz-cut, and a low-rider sports cap designed to make your head look flat. In other words, he lacks a certain savoir-faire compared to his European cousin. But both are broke. Neither has any idea what he will do next - though, for the American, it will probably involve the ingestion of melted cheese or drugs (or both). When the European collapses, a certain air of delicacy will attend his demise; the expired American will go up in flames in a trailer and they'll have to sort out his remains from the melted goop of his dwelling-place with a front-end loader.

This is the way the world ends for the OECD, the nations that affected to be developed and civilized. This phase of globalism is certainly not the end of history, but it is looking like the end of accounting tricks, and possibly democracy, which has discredited itself with accounting tricks. At a certain point in time, the sickening recognition sets in that appearances are not the same as reality - and then, all of a sudden, you're in a political maelstrom. Citizens of the various lands will discover that the money being argued over, shifted around from column A to column B, assigned to this or that actuarial table or budget line or account or obligation or vault or  "structured vehicle"- that money is just... not... there. There's no money. It was pretend money. From now on, none of you will get paid. Imagine a world where nobody gets paid.

 the rest is here:

3 Comments – Post Your Own

#1) On July 19, 2011 at 1:06 PM, leohaas (30.13) wrote:

Just one thing: if the ceiling is raised, the US will not be broke. After all, it will be able to pay its debts. If the ceiling is not raised, however, then the US is broke because it will not be able to pay all its obligations.

Being broke has nothing to do with how much you owe. It is a cash flow problem.

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#2) On July 19, 2011 at 5:05 PM, rfaramir (28.63) wrote:

Not being able to pay its debts is different from not being able to pay its obligations.

The US has 'obligated' itself to pay a bunch of promises it should not have made to the American people.

The basic property-rights-respecting obligation to pay your debts is a higher obligation than promises to spend on some special interests when taking from some other (unspecial) persons fails to come up with enough loot to fund the promises.

We have plenty of cash flow each month to fund our debt obligations about 10 times over. There is no reason to default on those debts. Only because politicians in power WANT to scare people into coughing up more dough to fund the special interest spending do they even mention it.

The US does not have a revenue problem, it has a spending problem. The revenues are much higher than they were 20 years ago, but the spending is higher still. Are we more free and prosperous than we were 20 years ago? No, we are poorer and more restricted. Is government bigger and more powerful or smaller and weaker? Bigger and more powerful. That's the cause of our problem.

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#3) On July 19, 2011 at 9:34 PM, Frankydontfailme (28.83) wrote:

And somehow democracy is the problem. We don't have a democracy.

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