I have, for
the past 35 years, expressed my grave concern for the future of
America. The course we have taken over the past century has threatened
our liberties, security and prosperity. In spite of these long-held
concerns, I have days – growing more frequent all the time
– when I'm convinced the time is now upon us that some Big
Events are about to occur. These fast-approaching events will not
go unnoticed. They will affect all of us. They will not be limited
to just some areas of our country. The world economy and political
system will share in the chaos about to be unleashed.
Though the
world has long suffered from the senselessness of wars that should
have been avoided, my greatest fear is that the course on which
we find ourselves will bring even greater conflict and economic
suffering to the innocent people of the world – unless we quickly
change our ways.
America, with
her traditions of free markets and property rights, led the way
toward great wealth and progress throughout the world as well as
at home. Since we have lost our confidence in the principles of
liberty, self-reliance, hard work and frugality, and instead took
on empire building, financed through inflation and debt, all this
has changed. This is indeed frightening and an historic event.
The problem
we face is not new in history. Authoritarianism has been around
a long time. For centuries, inflation and debt have been used by
tyrants to hold power, promote aggression, and provide “bread
and circuses” for the people. The notion that a country can
afford “guns and butter” with no significant penalty existed
even before the 1960s when it became a popular slogan. It was then,
though, we were told the Vietnam War and the massive expansion of
the welfare state were not problems. The seventies proved that assumption
wrong.
Today things
are different from even ancient times or the 1970s. There is something
to the argument that we are now a global economy. The world has
more people and is more integrated due to modern technology, communications,
and travel. If modern technology had been used to promote the ideas
of liberty, free markets, sound money and trade, it would have ushered
in a new golden age – a globalism we could accept.
Instead, the
wealth and freedom we now enjoy are shrinking and rest upon a fragile
philosophic infrastructure. It is not unlike the levies and bridges
in our own country that our system of war and welfare has caused
us to ignore.
I'm fearful
that my concerns have been legitimate and things may even be worse
than I first thought. They are now at our doorstep. Time is short
for making a course correction before this grand experiment in liberty
goes into deep hibernation.
There are reasons
to believe this coming crisis is different and bigger than any the
world has ever experienced. Instead of using globalism in a positive
fashion, it's been used to globalize all of the mistakes of the
politicians, bureaucrats and central bankers.
Being an unchallenged
sole superpower was never accepted by us with a sense of humility
and respect. Our arrogance and aggressiveness have been used to
promote a world empire backed by the most powerful army of history.
This type of globalist intervention creates problems for all citizens
of the world and fails to contribute to the well-being of the world's
populations. Just think how our personal liberties have been trashed
here at home in the last decade.
The financial
crisis, still in its early stages, is apparent to everyone: gasoline
prices over $4 a gallon; skyrocketing education and medical-care
costs; the collapse of the housing bubble; the bursting of the NASDAQ
bubble; stock markets plunging; unemployment rising; massive underemployment;
excessive government debt; and unmanageable personal debt. Little
doubt exists as to whether we'll get stagflation. The question that
will soon be asked is: When will the stagflation become an inflationary
depression?
There are various
reasons that the world economy has been globalized and the problems
we face are worldwide. We cannot understand what we're facing without
understanding fiat money and the long-developing dollar bubble.
There were
several stages. From the inception of the Federal Reserve System
in 1913 to 1933, the Central Bank established itself as the official
dollar manager. By 1933, Americans could no longer own gold, thus
removing restraint on the Federal Reserve to inflate for war and
welfare.
By 1945, further
restraints were removed by creating the Bretton-Woods Monetary System
making the dollar the reserve currency of the world. This system
lasted up until 1971. During the period between 1945 and 1971, some
restraints on the Fed remained in place. Foreigners, but not Americans,
could convert dollars to gold at $35 an ounce. Due to the excessive
dollars being created, that system came to an end in 1971.
It's the post
Bretton-Woods system that was responsible for globalizing inflation
and markets and for generating a gigantic worldwide dollar bubble.
That bubble is now bursting, and we're seeing what it's like to
suffer the consequences of the many previous economic errors.
Ironically
in these past 35 years, we have benefited from this very flawed
system. Because the world accepted dollars as if they were gold,
we only had to counterfeit more dollars, spend them overseas (indirectly
encouraging our jobs to go overseas as well) and enjoy unearned
prosperity. Those who took our dollars and gave us goods and services
were only too anxious to loan those dollars back to us. This allowed
us to export our inflation and delay the consequences we now are
starting to see.
But it was
never destined to last, and now we have to pay the piper. Our huge
foreign debt must be paid or liquidated. Our entitlements are coming
due just as the world has become more reluctant to hold dollars.
The consequence of that decision is price inflation in this country – and that's what we are witnessing today. Already price inflation overseas
is even higher than here at home as a consequence of foreign central
banks' willingness to monetize our debt.
Printing dollars
over long periods of time may not immediately push prices up –
yet in time it always does. Now we're seeing catch-up for past inflating
of the monetary supply. As bad as it is today with $4 a gallon gasoline,
this is just the beginning. It's a gross distraction to hound away
at “drill, drill, drill” as a solution to the dollar crisis
and high gasoline prices. It's okay to let the market increase supplies
and drill, but that issue is a gross distraction from the sins of
deficits and Federal Reserve monetary shenanigans.
This bubble
is different and bigger for another reason. The central banks of
the world secretly collude to centrally plan the world economy.
I'm convinced that agreements among central banks to “monetize”
U.S. debt these past 15 years have existed, although secretly and
out of the reach of any oversight of anyone – especially the
U.S. Congress that doesn't care, or just flat doesn't understand.
As this “gift” to us comes to an end, our problems worsen.
The central banks and the various governments are very powerful,
but eventually the markets overwhelm them when the people who get
stuck holding the bag (of bad dollars) catch on and spend the dollars
into the economy with emotional zeal, thus igniting inflationary
fever.
This time – since
there are so many dollars and so many countries involved – the Fed
has been able to “paper” over every approaching crisis
for the past 15 years, especially with Alan Greenspan as Chairman
of the Federal Reserve Board, which has allowed the bubble to become
history's greatest.
The mistakes
made with excessive credit at artificially low rates are huge, and
the market is demanding a correction. This involves excessive debt,
misdirected investments, over-investments, and all the other problems
caused by the government when spending the money they should never
have had. Foreign militarism, welfare handouts and $80 trillion
entitlement promises are all coming to an end. We don't have the
money or the wealth-creating capacity to catch up and care for all
the needs that now exist because we rejected the market economy,
sound money, self-reliance and the principles of liberty.
Since the correction
of all this misallocation of resources is necessary and must come,
one can look for some good that may come as this “Big Event”
unfolds.
There are two
choices that people can make. The one choice that is unavailable
to us is to limp along with the status quo and prop up the system
with more debt, inflation and lies. That won't happen.
One of the
two choices, and the one chosen so often by government in the past
is that of rejecting the principles of liberty and resorting to
even bigger and more authoritarian government. Some argue that giving
dictatorial powers to the President, just as we have allowed him
to run the American empire, is what we should do. That's the great
danger, and in this post-911 atmosphere, too many Americans are
seeking safety over freedom. We have already lost too many of our
personal liberties. Real fear of economic collapse could prompt
central planners to act to such a degree that the New Deal of the
30's might look like Jefferson's Declaration of Independence.
The more the
government is allowed to do in taking over and running the economy,
the deeper the depression gets and the longer it lasts. That was
the story of the 30s and the early 40s, and the same mistakes are
likely to be made again if we do not wake up.
But the good
news is that it need not be so bad if we do the right thing. I saw
“Something Big” happening in the past 18 months on the
campaign trail. I was encouraged that we are capable of waking up
and doing the right thing. I have literally met thousands of high
school and college kids who are quite willing to accept the challenge
and responsibility of a free society and reject the cradle-to-grave
welfare that is promised them by so many do-good politicians.
If more hear
the message of liberty, more will join in this effort. The failure
of our foreign policy, welfare system, and monetary policies and
virtually all government solutions are so readily apparent, it doesn't
take that much convincing. But the positive message of how freedom
works and why it's possible is what is urgently needed.
One of the
best parts of accepting self-reliance in a free society is that
true personal satisfaction with one's own life can be achieved.
This doesn't happen when the government assumes the role of guardian,
parent or provider, because it eliminates a sense of pride. But
the real problem is the government can't provide the safety and
economic security that it claims. The so-called good that government
claims it can deliver is always achieved at the expense of someone
else's freedom. It's a failed system and the young people know it.
Restoring a
free society doesn't eliminate the need to get our house in order
and to pay for the extravagant spending. But the pain would not
be long-lasting if we did the right things, and best of all the
empire would have to end for financial reasons. Our wars would stop,
the attack on civil liberties would cease, and prosperity would
return. The choices are clear: it shouldn't be difficult, but the
big event now unfolding gives us a great opportunity to reverse
the tide and resume the truly great American Revolution started
in 1776. Opportunity knocks in spite of the urgency and the dangers
we face.
Let's make
“Something Big Is Happening” be the discovery that freedom
works and is popular and the big economic and political event we're
witnessing is a blessing in disguise
