Just pulling together a few more or less random things for this post.
Just to bulk it up – ya know…
First: a few words from Charles Hugh Smith. (he is always good for a nice turn of phrase)
A funny thing happened on the way to the infinite demand/consumption model – The consumer-debt-based economy is toast, but everyone’s too terrified by its demise to acknowledge this reality, never mind consider a new model.
The consumer-debt-based economy is doomed; good riddance. It was nothing more than an elaborate cargo cult based on marketable anxiety…
(click on the heading for the full article)
He has a couple more articles that are worth reading too.
The Coming Global Instability, Part I
(July 28, 2011)
The Coming Global Instability, Part II
(July 29, 2011)
Here is a fun piece from “The Oil Drum”
Growth has become such a mainstay of our existence that we take its continuation as a given. Growth brings many positive benefits, such as cars, television, air travel, and iGadgets. Quality of life improves, health care improves, and, aside from a proliferation of passwords to remember, life tends to become more convenient over time. Growth also brings with it a promise of the future, giving reason to invest in future development in anticipation of a return on the investment. Growth is then the basis for interest rates, loans, and the finance industry.
Because growth has been with us for “countless” generations—meaning that everyone we ever met or our grandparents ever met has experienced it—growth is central to our narrative of who we are and what we do. We therefore have a difficult time imagining a different trajectory.
This post provides a striking example of the impossibility of continued growth at current rates—even within familiar timescales… We will begin with semi-practical assessments, and then in stages let our imaginations run wild—even then finding that we hit limits sooner than we might think. I will admit from the start that the assumptions underlying this analysis are deeply flawed. But that becomes the whole point, in the end… (more)
Here is some stuff from Karl Denninger.
That there are no cuts.
The claim of “cuts” is a lie.
This path will lead to a credit downgrade and ultimately bankruptcy.
He’s not pulling his punches – at all.
And Kerry is trying to argue against fixing the problem, and that “we need more time.”
Well, no, we don’t. We’ve had four years since the crisis became emergent. Both House and Senate have refused to deal with the issues. The Senate hasn’t even passed a budget for the last two years!
Sorry Kerry, your side has had the gavel and yet your answer is simply to print up more hot checks and lard up the debt. It’s a scam and a fraud.
I didn’t think I’d heard someone speak the truth in the Senate or House – that they were all liars.
Well, thus far – all but one. Thank you Senator Coburn.
And, following up on that theme…
- Lie once again about “cutting spending.” It does no such thing. It increases spending – every year. Bogus and outright-fraudulent “baseline budgeting” means that if they intended to boost spending $300 billion but only increase it $200, that’s a $100 billion “cut.” If you ran your household like this you’d be broke in a week. For the US, it will take a bit longer.
- No tax increases. That’s nice, but let’s not forget that while the Democrats scream about the “Bush Tax Cuts” the FICA tax cut was theirs. Obama signed it. You cannot keep reducing income and increasing spending forever.
- The cuts, fraudulent though they are, aren’t even real anyway – and not binding either. There’s nothing before 2013, which means a downgrade is almost certain. Further, raising the debt ceiling now for the whole amount, but allegedly finding the “cuts” over 10 years is an outright fraud by a ratio of 10:1.
- A 2013 timeline for actual changes means nothing, since the next Congress is not bound by what this one does. Period.
- Sequesterization didn’t work in 1997. It won’t work in 2011 either.
- We failed to get to $4 trillion. That’s what S&P said they needed, and they said they needed to see that within the next three years. Now we find out if S&P has any balls.
We also get to find out if the so-called “Tea Party” is worthy of the name. Yeah, I posted that my opinions change when facts do, and they appeared to.
Boehner needs to be ejected from Congress in the next election, and the remaining “mainstream” Republicans must go with him, along with any claiming to be “Tea Partiers” who vote for this abortion. All of them.
In the meantime, kill this bill and by doing so balance the budget in three days.
Lastly: I consider the Boiling Frog Syndrome.
If you put a frog into a pot of water, but raise the tempurature so slowly it doesn’t notice the change – and wont hop away before it ends up getting boiled.
Are we in the same situation?
Along with all the other writers I quote, I too have warned about the consequences of the path we are on.
But if the reality is that our slide into Recession and Depression is so slow and gradual, then people might habituate to the changing circumstances at a pace they can accomodate and tolerate.
If change happened overnight, people would be squealing blue murder. A cut in their income or wealth that equaled what inflation has done in the last decade, but was compressed into a year, it would provoke huge reaction.
Is it design or happenstance that the changes are so slow as to be below peoples perception tolerances?
I have been hoping for several years now that an economic collapse would provoke a revolution. But perhaps it wont – perhaps it never will.
It doesn’t matter if things get bad – it just matters that they don’t get bad too fast.
history is replete with examples: at Easter Island the civilisation there rode a train to nowhere all the way to the end. Their environment was patently degrading before their eyes, but all they did was build bigger and bigger monuments until there was nothing left to save. They did what we are doing, talked a bigger and bigger game and changed nothing.
More to the point, even while they could see there was a problem, it was such a creeping and slow thing that there never developed a crisis large enough and urgent enough to disrupt the status quo, or the established powers and social order.
The bums in charge never got kicked out on their arse. Instead they came up with every more reasons and rationals for why they needed to do more of the same.
For the Romans it was Bread and Circuses.
For us it is borrowing and debt (amoung other things).
It will kill us eventually if we don’t change. But it is killing us slowly, so slowly we don’t notice it – or can choose not to notice it…
I have been looking for the Big Bang of a global economic contraction or collapse.
Perhaps I should have been looking for a Wimper instead.
I still think the crash will come, but is a crash that happens at the speed of a glacier still truly a “crash”?
If it can’t provoke a startled reaction, then probably not, that just becomes an accomodation.
Are we truly so dumb, we can’t even get out of our own way?
Will we truly ride this slow train to nowhere?
Unless this crisis actually picks up some pace somewhere along the line.