Who’s in Charge?

For many years, we have been predicting that the die has been cast for economic and political cataclysm for the US economy and, by extension, that of the first world. Not surprisingly, the reaction by most others over the years is that the sun is still shining and that only a "Chicken Little" would be predicting a major storm. During this period, most people have said, "We'll deal with it if it comes and not before."

We are now on the cusp of that storm; close enough that most people are beginning to bite their nails. Eyes are glued nightly to the television news to see what new developments have occurred in the last twenty-four hours. There are almost daily occurrences that, only a few years ago were treated as so unlikely as to be laughable. At this point, the entire population is beginning to fear the worst, but hope for the best. Almost to a man, their next step is to wait to see what will happen. This is not only not the best approach to the situation, it is exactly the worst approach.

We were certainly not alone in our predictions. Beginning in 1999, when the Glass Steagall Act was repealed by the US Congress, those economists who were of the Austrian School immediately recognized that this one occurrence foretold a sea change in the economy; it assured a major calamity that would take years to fully unfold.

As those of the Austrian School predicted at that time, events such as the collapse of the housing market, the first crash of the stock market, significant inflation and many more dominoes have fallen in order, as predicted. Americans do now recognize that the situation is quite serious and, predictably, those voters who only two years ago opted for promises of "Hope" and "Change" (which were not backed up by any specific plan), are now turning more conservative and, in 2010 voted for a more fiscally conservative direction. Sad to say, their hopes will not be realized.

Let's briefly examine the reasons why they will not.

Most modern democracies are founded on the two-party system - a system which, in theory, puts the decision-making in the hands of the electorate. The two-party system is a wonderful invention, as it creates the illusion of control by the electorate, while allowing virtual dictatorship.

In the American model of democracy, the present dictator is Big Business, which is to say, the major banks, the military industrial complex, the oil companies, etc. While most Americans readily accept that these entities have undue influence, they fail to recognize that Big Business is directly in charge.

Stated briefly, the present structure is as follows:

One political party ostensibly favours economic freedom (business, movement of money, etc.), but opposes social freedom gay rights, abortion, etc). The other political party ostensibly favours social freedom, but opposes economic freedom. I stress the word "ostensibly," as the voting public routinely assume that their party will vote in accordance with their stated party principles. The elected members of the party do indeed speak out strongly in favour of the stated party principles at every opportunity, yet they ultimately vote independently of them; each time stating that "compromise was necessary in order to be expedient." On each issue, the voters are chronically surprised by this eventuality, yet, just as chronically, remain hopeful for success on the next go-round, only to be disappointed yet again.

Why on earth should this be? Surely, politicians would be likely to vote in accordance with their supporters wishes, yet they routinely disregard them. At some point, any thinking person should become cynical enough to say to himself, "If our elected members' loyalty is not with us (the party supporters), it must be with someone else. Who is that someone else?" Once that question is asked and, more to the point, consciously investigated, the answer is not difficult to obtain. It's right there for all to see.

As Deep Throat in the film "All the President's Men" famously stated, "Follow the money." The ultimate decision-makers in any political situation are always those who pay for the privilege. Big Business is the primary contributor to the campaign funds of both parties. Ergo, they truly control both parties. For example, at a time when Big Business wishes to ramp up, say, the level of military expenditure, they donate large sums to both parties, with the agreement that they will "get something back" after the election. They do, of course, donate the larger portion of their money to the party that is most sympathetic to the cause of defense. This assures that they will get their warfare (and the concurrent defense contracts) regardless of the outcome of the election. This process is the same regardless of the current goals of Big Business, whether they be defense spending, bailouts, destruction of the rights of the citizenry, etc.

This approach has been in effect for decades, but in recent years, it has become ever-more pronounced, as Big Business now actually chooses candidates. The method is to look at the existing field of likely candidates and offer a greater sum to the party in question if their choice of candidate is selected by the party for backing. At times, however, a candidate is created out of nothing, as has occurred since 2000. This is manifestly the reason why candidates such as George W. Bush, who was woefully unqualified for the job, was chosen as the republican candidate for 2000. Bush, while incompetent, could be counted on to act with bravado in any situation and, more importantly, could be counted on to do as he was told. He was the ideal choice to create war in the Middle East under the cause of "Freedom." In addition, he could be counted on to act decidedly against Freedom at home, by unashamedly passing legislation that would turn the US into a police state. (While these two decisions are in direct conflict with each other in terms of personal ideals, they both serve the cause of Big Business, the ultimate decision-maker).

Similarly, when a candidate is needed who will promise greater control of the people by Government, Big Business switches gears and more strongly supports the other party. In the 2008 presidential election, the voting public hardly noticed when Goldman Sachs, America's premier banking concern, provided considerable backing to the Obama campaign fund. On the surface of it, this backing seemed ludicrous - Big Business supporting an extreme leftist. However, the payoff came when Goldman Sachs' largest competitors (Bear Stearns, et al) were allowed to fail while Goldman Sachs received billions in bailout funds - a decidedly non-leftist act and a highly profitable one for Goldman Sachs.

On the military front, liberals have been disappointed and confused that Obama has continued the "Bush War" unabated and, worse, has now begun his own "intervention." However, if they were to look at the Big Picture, they would recognize that it is not the "Bush War", it is the "Big Business War". Both Bush and Obama are merely business managers, as will be the next president.

If Americans could step back enough to understand the Big Picture, they would be more able to see the political structure as little more than a distraction that has been created to keep the attention away from those who are really in charge. Politics in America has become reduced to something more resembling a team sport than a representation of the views of the voters. Just as few Americans would have both a Yankees cap and a Red Sox cap in their wardrobes, most voters buy into one party of the other and, over time, become so mired in the image of the opposing party as "evil", that they fail to recognize that their own party acts in near-identical fashion. This is "sports team" loyalty at its most effective.

It is specifically this blind dedication by the voters to party politics that allows the true controllers of the country to systematically remove, at turns, economic rights from the population under Democrat rule and social rights under Republican rule.

America is now in very deep trouble socially and economically and most Americans are now, very late in the game, recognizing this fact. Yet the great majority continues to vainly hope that their party will somehow prevail, as they believe that this would mean that everything will turn out fine. This belief assures the continuance of the present process, as Big Business steadily devolves what was once a great republic and relegates both Democrat voters and Republican voters equally to a condition of ever-increasing servitude.

In 1935, Benito Mussolini, dictator of Italy, wrote, "Fascism should more properly be called corporatism because it is the merger of state and corporate power." Some Americans reading this may wonder if that can be possible in America's future. Those who are truly honest with themselves will admit that America is now and has been for some time, a true Corporatist state.

As stated above, this is an ongoing process, which has been possible through the willing cooperation of the American people. Another pertinent quote is from Alexander Tyler in 1787, an Englishman who, in predicting the likelihood of success for the new American republic, stated, "A democracy is always temporary in nature; it simply cannot exist as a permanent form of government. A democracy will continue to exist up until the time that voters discover they can vote themselves generous gifts from the public treasury. From that moment on, the majority always votes for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to loose fiscal policy, which is always followed by a dictatorship."

The US is well along the way in this process. It is interesting to note that no democracy has ever reversed this process, as long as some hope existed of maintaining the entitlements that they gave up their liberty to receive. Invariably, a collapse of entitlements has always been necessary to convince entitlement junkies that there is, in fact, no more free lunch. If history holds true in the current situation, the US will not save itself in 2011, nor in 2012. It will not begin to reverse its course until the collapse of the system has occurred.

It can be argued that the mere discussion of collapse is defeatist thinking, but I disagree. I believe that it is always wiser to be a giraffe than an ostrich; that is, to try to see above the clouds than to stick our heads in the sand. The soundest reasoning is to go under the assumption that history will, as always, repeat itself. (Human nature, after all, never changes.) Once we accept that likelihood, we turn our attention to adjusting our personal situation as effectively as possible, so that we are not amongst the victims of events that are beyond our control. We cannot stop a storm, but, if we plan ahead, we can either travel away from it, or create our own personal protection from it until it blows over.

Tags: us politics, euro, debt crisis, austrian economics,