Sunday, 11 November 2012

America Defeats America



There are two speeches in American political history that I find wholly admirable.  The first is Abraham Lincoln’s Gettysburg Address.  The second is Richard Nixon’s Great Silent Majority oration.

It was the latter I thought of in the wake of Barack Obama’s recent re-election to the White House, specifically the conclusion, where Nixon offered the following observation;

Let us also be united against defeat. Because let us understand: North Vietnam cannot defeat or humiliate the United States. Only Americans can do that.

That’s it exactly: in voting for Obama Americans have defeated and humiliated themselves.  The country faces four more years of drift, uncertainty and decline.  The business of America is business, former President Calvin Coolidge once said.  It isn’t any longer: it’s big government and welfare.  The country is well on its way to becoming just another European social democracy, its standing in the world diminishing by the day.  How are the mighty fallen.

I speak as an outsider, of course, one who has a tremendous respect for the United States and the leadership it has traditionally offered the free world, a leadership, as Nick Gardiner noted recently in the Telegraph, which depended on a sound economy, limited government, free enterprise and a strong national defence.  I speak as an outsider living in a European present, knowing exactly what that entails, a present that is obviously destined to be America’s future.

Yes, I can understand the uncertainty.  I’m sure a lot of Americans voted for Obama less out of love and admiration than fear of the possible changes that a Republican presidency might bring.  Obama, perhaps, offered hope.  What kind of hope, one has to ask?  His record shows clearly enough that it is the greatest of the many misfortunes that escaped from Pandora’s Box.

What did you get?  Was it a new vibrancy, a new economic energy, a new horizon?  No, it was bailouts that bailed out nothing; it was crippling levels of debt that crippled the economy, which will cripple the economy far into the future.  More taxes, more poverty, are all part of the Obama legacy, the answer to which is the vicious cycle of welfare.

The facts are stunning.  America’s national debt now stands at $16 trillion.  Yes, trillion.  Can you picture even one trillion?  I can’t; it’s too big a figure for my limited imagination.  But in actual figures it’s this: 1, 000, 000, 000, 000, that’s a million million.  One trillion dollars laid end to end would reach from here to the sun. Even like this it seems to defy comprehension.  In more manageable terms the actual American debt per taxpayer amounts to $111,414 and rising. 

The position, astonishingly enough, is worse than Greece, Europe’s economic Achilles heel.  The Weekly Standard reported recently that

According to estimates from the International Monetary Fund, America’s total government debt will be $16.8 trillion by the end of the calendar year, compared to $441 billion for Greece…On a per person basis, that means U.S. debt is $53,400 for every man, woman, and child, compared to $39,400 for every man, woman, and child in Greece. The disparity between per capita debt in the U.S. and Greece has grown 40 percent (roughly $8,400) since 2011. Now, U.S. per person debt is 35 percent higher than that of Greece, and is also higher than per capita debt in Portugal, Italy, or Spain (which together with Greece make up the so-called PIGS countries).

With rising debt comes declining economic freedom.  The United States has now fallen to tenth place in the world rankings, with government spending exceeding one third of total domestic output. In other words, the US government now spends more than the entire Gross Domestic Product (GDP) of China, Australia and Spain combined.  To this burden has to be added the promised health care reforms, not a dream but a bureaucratic and financial nightmare.

The businessman challenged the lawyer and the lawyer won, that’s the verdict of last Tuesday.  Look for more of the same, look for ‘progressive’ policies that offer no progress, look for increasing forms of paternalism and liberal totalitarianism.  Look, above all, for a nation divided against itself.  

16 comments:

  1. America is being held hostage by this %#@$&* !

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    1. I found out tonight that some states are petitioning to secede from the Union! I've no more details at the present.

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  2. Here's what National Public Radio - as liberal a source as you can find in the USA - says about the approaching 'Fiscal Cliff.'

    http://www.npr.org/2012/11/11/164797987/how-the-fiscal-cliff-would-hit-the-economy

    On the other hand, military spending off the books is still wildly out of control.

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    1. That was an interesting article, Calvin. The prospects seem fairly dire.

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  3. Una situación complicada, realmente.
    En esta crisis global, unos Países arrastran a otros y la especulación y los intereses no paran de enfriar la economía.
    Muy buen Post.
    Un abrazo.

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  4. Indeed. The civilization that is known as the West has risen reached it's zenith declined and is now in the process of collapse. That is certain what is not certain is when and what form the collapse will take. No doubt the collapse will happen sooner rather than later if one has to make a prediction then it would have to be by 2014. As for form it will be at least very unpleasant which may lead to a renaissance or more likely a new dark age.

    The Obama's and Hollande's of this world are a very good indicator that the collapse is imminent as collapsing civilizations often have leaders that are week and inept in charge just prior to the collapse.

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    1. Antisthenes, spot on! I was thinking today of drawing parallels between the modern Western world and Rome of the fifth century, with leaders like Obama and Hollande reprising emperors like Honorious and Arcadius. The downward sweep gets ever faster.

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  5. A look at the figures is interesting.
    UK public debt to GDP ration 90%
    US public debt to GDP ratio 73%
    UK external debt to GDP ratio 503%
    US external debt to GDP ratio 100%
    US debt is lower than most EU countries, and much lower than UK debt. And that is before we start to unravel the festering pit of the derivatives market....whose debt looks like making the US debt look tiny.
    I particularly like the fact that the US has massive manufacturing ability, while the UK has minimal, and falling (note that Ford now manufactures no vehicles in the UK with the closure of its last plant)

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    1. John, we have gone even faster into the cycle of decline. We have a government pledged to reduce debt which is actually increasing it. Do we have a government at all, I begin to wonder? If we do, it has all the power of a county council.

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  6. Yes, the US is an endless source of disaster stories.
    Another place where "social" welfare is totally outpaced by "corporate" welfare.
    After all, a 30 million dollar aircraft looks good on paper, and looks expensive through the firing sights of a shoulder-borne ground-to-air missile (which is arguably more intelligent than the guy firing it).
    The UK does no better, endless cosseting of highly uneconomic "defence" industries, that are only useful when used for attacking someone.
    Do we have a government ?
    Good question.
    Well, we have the EU, and various governments within....that do ?
    After all, even with Camerons endless intent to "claim back" powers to the Uk gov, he has still to assure us that the Uk gov is able to wield these powers...and he forgets that all the EU has to say is "no".
    Where does he go then ?
    None of the parties has any intention of leaving the EU, but the only way to retrieve any of "the powers" is to file intent to leave and then negotiate terms to continue to trade with the EU while being out of it. None will do that. the gravy train is too well equipped to get off, for them.
    Economics is a pointless exercise, what one takes from a pocket one puts back into another pocket. Quite simply, the gov "bailed-out" the banks. It did that by buying-back government bonds from those banks. To do that it just printed the money. It cost nothing. So the gov debt of one trillion is actually 650 billion. Wise people would borrow, if needed, when interest rates were low. Interest rates are low now.
    I suggest a read of:

    http://notayesmanseconomics.wordpress.com/2012/11/12/after-fridays-move-is-the-uk-now-monetising-its-government-debt-it-does-now-look-rather-permanent/

    which is, to say the least, interesting !
    Smoke and mirrors anyone ?

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    1. And then there is Abu Qatada. There comes a point when one thinks it's not possible to get any angrier, only to discover that it is!

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  7. http://www.usdebtclock.org/world-debt-clock.html

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  8. Worth a read. And contemplation:

    http://www.zerohedge.com/news/2012-11-18/global-shadow-banking-system-rises-record-67-trillion-just-shy-100-global-gdp

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    1. John, I shall read and contemplate.

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