Return of Class Warfare

The super rich suffer from acute nihilism and are vastly outnumbered by newly Internet literate aggressive personality types. They will lose badly if they don't preemptively and radically modify present socioeconomics

Considering all the negative attention that the global oligarchy has been getting recently, one interesting fact often left unmentioned is that the super rich are outnumbered 9,999 to 1. Let's briefly define what we're dealing with.

When one really filters rich people overall, it's evident that the number of decision makers is actually rather small. Out of 7 billion people on earth in the near future (6.8+ billion now), less than 1% are trend setters within social hierarchies. This is the socially visible merchant class that makes money purely off capital investments. That is less than 70 million capitalists scattered about. Majority of this group have relatively insignificant pools of investment money which doesn't expand much (mom and pop small business owners who may have some political pull locally but not too much nationally and internationally).

Within this group, there is 1% (<700,000) that makes the rest look like paupers. Here is a detailed article showing the sheer inequality among the capitalists in United States. These are the people so far removed from the rest of the world materially that they usually end up oppressing the lesser capitalists (through stock market swindles, cartels, and disproportionate buy outs of political lapdogs). In other words, majority of those within richest 1% are fighting their own battle against the 1% in their ranks.

The 700,000 super rich are trend settlers among trend setters. At this point real oligarchic activities become possible. An oligarch is simply anybody with enough disposable wealth to influence politics. Although actions (like paying 2 thousand dollar ticket at a candidate's fund raiser and donations to think tanks of one's choice) technically qualify, in the international arena influence really requires funding/owning think tanks with a global reach.

Finally, perhaps around 50,000 individuals (a few thousand families really) within the 700,000 have the power to culturally pull the rest of the international oligarchy behind them through role modeling and proactive moves. This small number of key oligarchs makes it very easy to hound them politically. Conceivably, people can protest in front of rich people's gatherings rather than in front of gatherings of politicians in the future.

The 700,000 are buffered by millions of loyal and very well paid proletariat patsies. They are the cream of the crop of the wage laborers who often defend the caste above them to the bitter end. One can compare them to house slaves who got it pretty good (200,000 - 600,000 a year paychecks). They can be found writing state propaganda articles for such oligarchic mouthpieces as the Harvard Business Review, The Economist, The Atlantic, and similar rags. This richest proletariat caste appears the most brainwashed due to its complete adoration of the ruling caste (desire to mingle and get interviews) and contempt for the caste right below them. Here is a good example of the type of apologist garbage they tend to write. It pretends to be a serious criticism on the surface while actually being staunchly defensive (avoid if you have a weak stomach).

The good news.

Out of 7 billion people on the planet, almost 500 million people are ENTJs and ENTPs, many of whom are getting Internet for the first time. If you include all relatively unemotional and intuitive homo sapiens such as INTPs and INTJs (perhaps even more dangerous to the rich through behind the scenes work), then the number goes to 700 million uppity proletariat. These 700 million people are the most likely to self educate themselves by utilizing new informational technology and to subsequently find out about their exploitation at the hands of the 700,000. Now, they cannot all be bought off, suppressed, and co-opted. There just isn't enough room in the upper circles for so many comfortable house slaves. Even if 20% of them are co-opted into status-quo hierarchies worldwide, that leaves over 500 million on the outside looking in. This means that the enemies of humanity at large are outnumbered roughly 500-1000 to one (by people who got the drive and the oversized ego to try to bring them down).

The richest 0.01% cannot always count on the loyalty and constant support of the 10% of the population internationally (those who are assumed to have too much invested in the system and who are "too comfortable" to rebel). As much as petty capitalists and top notch white collar professionals defend the oligarchy on a day to day basis, as much as they want to be the people above them, their adoration can nevertheless rapidly transform into burning resentment and jealousy (since they realize that there are tangible limits to meritocracy and social mobility even in the upper circles). Therefore, roughly half a billion energetic, excitable, self educated, and newly politically aware individuals on the "outside" got people and supporters on the "inside" who can sabotage the oligarchs up close and feed valuable information (leak data, provide whereabouts of gatherings, provide funding, and share strategic input).

Besides being outnumbered they are also overcome with nihilism which can be exploited

Just as was the case over 100 years ago (when Nietzsche first described the phenomenon in detail), it appears that the most powerful individuals on the planet have not developed a common and coherent moral system for themselves and their offspring. Even as the elites are becoming increasingly culturally homogenized via cosmopolitan modes of consumption, Internet communication, international think tanks, common ivy league education, and jet travel allowing frequent dinners together, the majority of them have not officially agreed upon a life expanding moral framework of the future.

The future necessity and inevitability of some centralized governance on a planetary scale combined with the psychological need of rulers to overcome nihilism in a permanently atheistic world (when hedonism, Buddhism, socioeconomic ideology, and attainment of power to highest offices in the land fail to provide psychological comfort), will lead to such moral concoction eventually. However in the meantime, the lack of a relatively uniform belief system to indoctrinate elite's children (future planetary leadership) into is leading to severe infighting when it comes to paths towards planetary unification. This in turn allows for international paralysis and deference to the default mode of predatory corporate globalization overlapped with petty nationalisms.

Out of 700,000 super rich, the combination of thirst for both knowledge and power over others is mostly prominent among the NTs in the Myers Briggs typology. That leaves us with roughly 70,000 individuals who'd like to tinker with humans in new ways on a global scale and who have the financial means to do so. The ESTJs, who are 10% of the population, can add people to this group but only for managerial non-productive (in terms of building a new system) positions. Oligarch ESTJ spawn is likely to engage in something seemingly unnecessary considering their money such as military service. ESTP ofspring would get their kicks from flying balloons around the world or hunting lions (the traditional venues). Other personality types would not really be interested in possibilities of planetary governance. Many would consider politics in general beneath them (since politicians are just butlers) and boring. Even fame loses its appeal since it is not a means to get ahead and brings attention of the peasants to the wealth. If politically engaged at all, their donations would just go towards supporting the status quo of current predatory globalization.

Most of the world's proletariat are so busy just trying to survive that they have overestimated the potential of psychological fulfillment that hedonism can bring. For children of the oligarchy, sex, travel, and partying stop providing the same kick when they reach their late 20s. That's when they go their separate ways as determined by what neural breed they are. The financial means of the oligarchic NTs do a number on their egos (and the egos of the clinical psychopathic minority most likely overly represented within the ENT group) as a type of world conquest becomes possible.

One may argue that power may be sufficient to fill that void but only a minority of elites have the extroverted and emotionless traits to be inclined towards active involvement in politics. Even if they attain positions in high office, the satisfaction from power gained is not great considering most modern legislative and executive branches in the Western world are trapped within crushing interconnected oligarchic corporate power networks. Thus, even if a son from the capitalist class gets into high public office, his real satisfaction will stem mostly from drinking, talking, and dining with fellow political junkies rather than remolding the world with his will. If some legislation does get passed, it'll mostly benefit his fellow top 1% peers and have a less than pleasant feel that he is their secretary. It could very well be that political backers who actually try to get the poor peasantry educated are doing so out of resentment against their overbearing aristocratic fathers and/or their more extroverted political friends. This certainly has happened before when some children of the aristocracy in imperial Russia and Britain flirted with communism.

Conclusion:

They are much weaker and more psychologically paralyzed than they appear. Their patsies can be turned against them and millions of people throughout the world will go about doing just that. The goal is to target key oligarchic financial structures (federal reserve and various major banks) and create informational critical mass in the minds of the wage laborers at large. The super rich have grown too soft and comfortable and the intellectual oligarch strategists among them are overwhelmed by group think and cultural inertia of their peers. As this brilliant article suggests, sociologists should refocus from studying the least well off members of society to those best off in order to properly analyze what we're up against. To understand it is to find ever better ways to fight it. In the near future, the political class can be made to serve the general population again. Politicians are notorious for being able to smell blood in the water and the oligarchs present very juicy cows from which to milk political capital and fame (those politicians who stand up to the robber barons tend to get into history books).

Sound Money and Deflation

"With the enormous leaps in industrial productivity over the 20th century, shouldn't a penny now buy me at least 10 Snickers bars instead of nothing?" 

(Or how fiat money serves to prolong the life of capitalism while libertarians are ironically fighting to make capitalism disappear)


A great question, considering world's population rose 4.2 times from 1900-2010, annual copper mining output rose 30 times in same time period, and industrial/agricultural mass production technology (for making candy) has made exponential efficiency leaps. To investigate this serious matter lets look beyond the screams of "federal reserve and fractional lending robbed us all with depreciating overprinted fiat currency!" and delve into the underlining physical dynamics.

A one ounce Hershey's bar cost 3 cents (9 grams of copper) in 1918 whereas a 1.45 oz Hershey's bar in 1982 (last year to have 95% copper pennies) was 20.6 cents/62 copper grams per chocolate ounce. As of 2010, the Hershey's bar approximates 65 fiat cents an ounce but since the imperial authorities diluted the penny with mostly zinc (making current pennies a harder to quantify mix of zinc and copper), I'll use the 1918-1982 period for simplicity.

If one adjusts for inflation, 3 cents in 1918 is 19 cents in 1982 (539% depreciation in purchasing power). An 80 year old, lets call him Bob, getting his favorite childhood candy treat would have seen his under the mattress savings buy 6.3 less Hershey's chocolate. Now this may not seem too bad IF Bob was in a theoretical situation where his real income growth was pegged to inflation the entire life and his fiat currency grew in a bank under inflation pegged interest throughout the 20th century. Considering the candy's probable mild price buoyancy due to brand recognition, on the surface it looks like the company is only charging Bob 8% more than they did in 1918 (20.6 cents to 19).

Looking through an Austrian economics lens of inflation being an increase in the money supply, since most people do not have their finances perfectly adjusted to inflation, Bob is being continuously ripped off and impoverished via inflation tax. He may not get exactly 6.3 times less chocolate but even 2-3 less Hershey's towards the end of life is a criminal swindle.

A defender of the socioeconomic status quo in 1982 may partially agree but counter this via a pseudo-Austrian angle, "If anything Bob is lucky to only be paying 62 grams of copper per ounce instead of 9 grams in 1918 since copper is mined faster than people are breeding. He looks like he is getting a deal when using this depreciating physical metal! Copper is as fiat as paper!" (Authorities saw the copper content in penny spike more than a fiat cent in 1980-1981 period and thus changed the content, the price of copper in penny then collapsed to just under 1 fiat cent again in 1982-1984).

This is an interesting response and lets take a look at it without distracting ourselves with multitudes of other serious issues such as the government ending the use of silver in currency, going off the gold standard, stagnation of real incomes, etc. Some of these issues will begin to be resolved indirectly by the end of the article.

If one tries to look at Bob's situation via Marxist economics lens of commodity exchange, then we see that the poor fellow is being swindled in another way. This investigation is a little trickier considering technological productivity cannot be readily quantified and since the concept of productivity itself is culturally determined. What is very safe to say is that mechanical efficiency in producing an ounce of Hershey's has risen a lot more between 1918 and 1982 than the 260% rise of human population in same time period. That is, if copper production/demand magically froze in place, a 1982 Hershey's chocolate ounce should cost not 9 grams but substantially less. Surely, they've figured out ways to stamp out these chocolate treats by the millions in ways not dreamed of before (even taking into account employee salary operating expenses).

Of course copper dynamics were not frozen but they also end up benefiting Bob. If you consider the borderline exponential and evolving industrial demand for copper for electrical/water purposes throughout the 20th century, then it is clear that the 530% rise in copper production in 1918-1982 does NOT devalue 62 grams (needed to buy one 1982 Hershey's ounce) by half.

In other words, even though the copper money supply rose at twice the rate of human population, we did not see 100% inflation of the penny since the industrial demand for copper kept up pace with the human population at the very minimum. Therefore, a Hershey's bar ounce in 1982 should have cost at most 6 cents (1918 price * population growth) instead of 20.6 cents. Therefore, Bob doesn't just get ripped off through expansion of the fiat money supply but by value of goods not reflecting the breakneck pace in development of production and distribution of Hershey's bar. Considering a pre-1982 copper penny is approaching 3 fiat pennies in worth at the end of 2010 (and many countries having pulled copper from their currency in last 30 years), it may well be that a Hershey's bar should cost a lot less than a copper cent today. This makes more sense if one remembers that a silver dime from 1964 is worth over 2 dollars presently (even though annual silver output expanded 35 times in 1900-2010 period).

It appears safe to say that fiat currency was haphazardly introduced by business leaders in first half of the 20th century (via their political appointees) to prolong the life of capitalism via inflation. Ironically, the financial robber barons ended up doing the same thing that rural agricultural interests wanted in late 19th century America. 19th century saw various deflationary collapses and farmers wanted silver/gold bimetallism since rapid mining of silver would have introduced inflationary pressure on the dollar and thus prevented profit loss. Banksters 100 years ago were gold bugs since they made money from loans and deflation benefited the loan sharks. Since financial capitalist take over of industrial/agricultural capitalism was mostly complete by 1900, bankers tended to win political arguments.

During the great depression, there developed a compromise and some convergence of thought between financial, agricultural, and industrial interests concerning the benefits of inflation. Biggest bankers by that time, found a way to profit while expanding the money supply via modern money mechanics and farmers ended up getting governments to pay them to not produce too much and thus prevent deflationary profit loss. FDR managed to reconcile the key parasites, preserve capitalism, and artificially prolong the profit taking of major monopoly industries at the long term expense of the consumer (in a very humane developmental manner). Yes, he also did a lot of great things and is one of the kindest masters people saw in the last century (no sarcasm).

If the price of an 1982 Hershey's bar reflected the real amounts of hard money (commodity) availability PLUS availability of Hershey's ingredients (commodities) PLUS the cutting edge technological ability to produce and distribute the Hershey, then we'd see the company experience the periodic deflation born crisis of overproduction that the communist manifesto summarized. One can imagine what will happen to corporate bottom line if a copper/silver/gold/rare earth metal commodity money coin buys more consumer goods every year than the previous one. On paper, Austrian utopian capitalism is too efficient and benefits the consumer too much (so much in fact that it quickly implodes in deflationary collapse horror show, massive unemployment, and technologically driven socioeconomic evolutionary leap towards post-scarcity society).

It is little wonder that Trotsky sided with Austrian economists when he wrote of pre-requisites of United States going communist. They being commodity backed hard money utilized to barter for consumer goods. This is especially true for gold since gold production only rose 5.5 times in the 1900-2010 period, barely above population growth. Ironically, the current wave of libertarians are fighting to make capitalism disappear (since non-fiat currency would fully unleash the post-scarcity potential of means of production and distribution that have existed around us since at least the 1950s and that Buckminster Fuller and King Hubbert described in detail). I will leave with a few 1934 quotes from Leon Trotsky regarding the absolute necessity of ending the federal reserve. ;)



"-This system will be made to work not by bureaucracy and not by policemen but by cold, hard cash. 
-Your almighty dollar will play a principal part in making your new soviet system work. It is a great mistake to try to mix a “planned economy” with a “managed currency.” 
-Your money must act as regulator with which to measure the success or failure of your planning. 
-Your “radical” professors are dead wrong in their devotion to “managed money.” It is an academic idea that could easily wreck your entire system of distribution and production. That is the great lesson to be derived from the Soviet Union, where bitter necessity has been converted into official virtue in the monetary realm. There the lack of a stable gold ruble is one of the main causes of our many economic troubles and catastrophes. It is impossible to regulate wages, prices and quality of goods without a firm monetary system. An unstable ruble in a Soviet system is like having variable molds in a conveyor-belt factory. It won’t work."

Maximum Wage and the Limits of Human Inequality

Pegging the rise of maximum compensation to the rise in the minimum will go a long way towards avoiding global disruptions





The appropriate maximum wage that society should have will be a critical issue in this century. It is generally agreed upon at this point that a neurosurgeon should get compensated more than a tour guide. The Soviet experience of a relatively narrow gap between highest and lowest compensation (top company manager officially earning 3-5 times the entry level worker) shows that society's progress stagnates if tangibly unequal abilities and contributions are rewarded with compensation that's perceived as relatively equal. Yet various banana republics (United States included) around the world demonstrate that stagnation also sets in when wage inequality gets sufficiently monstrous.

It is not enough to look at relatively egalitarian societies like Japan or Sweden to try to find some golden maximum/minimum ratio. What is needed is a common sense and/or philosophical framework that 1) justifies a certain income ratio
and 2) creates conditions compatible with human nature and self interest that allow the set ratio to be maintained.

1) Justification for capping the difference between top and bottom incomes should be grounded in reality and pragmatism and not idealistic popular desires of how a world should be. Theorists like Nietzsche spent considerable time elaborating that humans aren't equal. Yet in an ironic twist, the same reasons (that he gave for not having a leveling system where everybody is assumed to have the same value) can be used to set limits to difference in valuation.

click to enlarge

Like many characteristics of a population, the natural abilities to be exchanged for money are spread along a bell curve. Natural ability is anything that gives a physiological edge in addition to training. An example would be the hyper sensitive and rare taste buds of a top chef or a fighter pilot with remarkable reflexes and fast twitch muscles. If you take a person with poor taste buds and a person with exceptional ones and provide both with identical intensive high quality training on food preparation, there will be a certain intangible limit to how much better one chef is than the other. This applies to all professions. What is known for sure is that one is not 1000 times better chef after the training (or 100 times). Such numbers are simply ludicrous mathematically.

Napoleon Bonaparte is not 100 times superior person to say, a gas station manager and neither does Napoleon deserve 100 times more cars, 100 times more houses, 100 times better quality food, 100 times the salary, 100 times the size of personal land, etc. Think about it. Even without the leveling of military training, if you take the brain of the gas station manager and multiply its function by 10, the gas station manager would give Napoleon a run for his money in most if not all areas of life. Whether intelligence, speed, personality, patience, if you take an ability on one low end of the bell curve and multiply it by no more than 10, you automatically get to the other end of the bell curve (ex: IQ of 30*10=300).

I am using a multiple of 10 for simplicity here since the actual difference cannot be readily quantified (one perhaps can argue better for 15, 20, or 8). Considering the outrage over the bankster bonuses in the last 2 years, it appears the general public intuitively knows that there are limits to salary compensation. What remains to be done is to draw some line in the sand. A person earning 10 times as much as somebody earning 50 grand a year is getting half a million and automatically gets into top 1% income bracket. 10 times the compensation is an enormous leap. This perhaps sounds shocking, the way explaining that a duke does not have divine right to all the local land might have sounded shocking 300 years ago.

"But isn't compensation also determined by social importance of an ability (usually allocated by market forces)?"

As far as social importance, it is a very valid point. In today's absurd dying socioeconomic system, we don't see prime ministers and military generals receiving the same incomes as Lloyd Blankfein or other wall street criminals. We also don't see the operators of nuclear missile submarines getting 400 times the amount a waitress or a new army recruit gets (the way a modern CEO does compared to entry level workers in his/her organization).

Certainly the argument from social importance would indicate societal leaders, augmenters, and protectors to be the most vital. It is a tricky subject which should be properly studied with in depth examination of what professions benefit society the most (hint: engineers and scientists in political power). There are various ways of determining social importance with length and difficulty of educational training being one of them and critical examination of what makes real physical economy grow being the other (to filter out people who spent 13 years in intensive study of psychoanalysis or Gregorian chant from the top compensations).

This leads us to the idea of a free market competition, a concept as utopian and disconnected from reality as pure communism. The unregulated "market" is and will remain a diverse collection of political power centers that evolve the rules of the global private casino as they see fit. The obvious examples of the market giving top rewards to athletes, pop stars, and organized crime (Citigroup, JP Morgan Chase, etc) shows that it is a very poor determining mechanism of socially important tasks. This is where we see a difficult social divergence happening between perceptions of important jobs (nuclear power plant director) and consumer determined rewards for not-so important jobs (national talk show host). Obviously we'd like for both the public and infrastructural demands (that allow the public to live) to have a say in compensation without too much divergence.

If incomes could be broken into 10 levels, it very well could be that a top entertainer should be a level 7 worker (earning 7 times more than the minimum income of level 1) while the nuclear power plant director gets to be level 8. This will be up to the politicians and the needs of the crowds as long as they maintain the ratio system (in this case, based on maximum wage difference of bottom income multiplied by 10).

2) How does one make the maximum wage system stable and compatible with human nature? The simplest solution is to make the rise in maximum salary dependent on the rise in minimum salary. This means that if level 1 worker earns 100 units a day while the top level 10 worker earns 1000, the level 10 would only be able to get a raise of 10% to 1100 units if the salary of level 1 goes to 110. If you are beginning to suspect we are moving beyond capitalism to a more high tech welfare system of the future, then you are correct. Notice how the maximum salary gets to grow while being tied up to the minimum.

Pegging the material progress of the highest compensated to the material progress of the poorest can easily work within the capitalist system but it begins to work even better in a post-monetarist technocratic system. The strongest and richest must be given a personal incentive to improve the lives of the weakest and poorest through an income peg. They will still remain 10 times better off (10 times the cars, 10 times the living space, 10 times the clothing) but at the same time, if they work in their self-interest they will be lifting all boats. This dynamic inevitably puts more technically oriented people into top positions of society where they are most needed anyway. We're talking people who understand how to improve infrastructure, logistics, and basic structural economic welfare provision.

These matters will continue being a major concern as we gradually transition to a post scarcity transhumanist world of the future. It is important that we start discussing the limits to human inequality early on before social disturbances on a planetary scale have a chance to really develop.

WikiLeaks Reveals Bits of Conversation from Various G20 Meetings

Top 10 Jobs of the Future

As the Western world is seemingly headed into a deepening neofeudalism, the question once again turns to what jobs will be on the rise in the next 2 decades. We've consulted our experts in sociological and economic trends and came up with the optimal list of job satisfaction and bang for your college investment buck.

1) Personal Transport Professional

Assist visiting Chinese businessmen to move around in style and get in shape at the same time! Give tours, have fun conversations, and even have a chance to learn about how non-Western nobility lives.

Required: 4 year college degree with double major in public relations and athletics (parents, send your kids to endurance runners camps early so they get enough awards to compliment the grades needed to get into college). Knowledge of Mandarin and other languages recommended.

2) Organic Farming Technician (OFT)

Become a freelance serf who is not bound to the land like your peers. Enjoy fresh food and air daily as you help pay for your sins against Mother Earth, Queen of Queens.

Required: Masters in agriculture with additional year for local certification in soil management. Monthly dues to area's farming guilds vary by region.

3) Entertainment and Media Professional ("Court Jester")

Being a celebrity star is easier than ever. You too can be famous in your regional fiefdom. Whether performing at a birthday party for the son of a local baron or delighting the hearts of weary OFTs after a harvest, endless job satisfaction is to be had uplifting the spirits of nobles and serfs alike.

Required: Bachelors in media communications and athletics to be Court Jester's assistant. After unpaid internship as right hand man for a year, another 4 years in graduate school for a public relations degree. Must be good looking and possess good cheer.

4) Colonial Military Peacekeeping Officer

Help protect freedom at home by promoting Green Democracy in liberated regions. Do your state duke and Mother Earth proud by performing bravely and professionally in rural/urban pacification. Have the power of a small time lord yourself by calling in airstrikes and settling disputes among tribal factions.

Required: ROTC and minimum of 4 year military commitment followed by police officer training. Public relations degree and knowledge of multiple languages is a big plus.

5) Footwear Technician

FTs have always been essential to our society but in recent years more so than ever due to increasingly exotic hides found in the footwear of the nobles and visiting tourists. Knowledge of shining methods for specific leathers (acquired from strange animals on remote personal hunting grounds) gives one a confident sense of purpose.

Required: Double major bachelors in animal biology and public relations as well as a 3 month apprenticeship in a local FT guild.


6) Harem Upkeep Assistant

Live in a futuristic gated castle and eat the same healthy exotic food that your lord eats! Socialize with dozens of other harem brides as you work on joint projects of manor improvement and personal assistance. This highly sought after position is also an opportunity to be selected for delegated uterus renting to produce future nobles. Generous retirement packages.

Required: 2 year intensive training course in psychology and communication and at least 95% score on the HAT (Harem Assistant Test). Internships before dowry negotiation may be asked for.

7) Freelance Strike Manager

Help protect your community and the assets of the local baron through strike removal. Utilize the latest in tazer, chemical, and baton methodology to extract the troublesome progressive/communist/socialist/terrorist agitators from the ranks of normal serfs. Have the satisfaction of getting our remaining factories moving again! Flexible schedules and wide range of personal freedom in handling of diverse situations.

Required: Must be a loyal member of the local ruling party for at least 4 years. Former colonial military peacekeeper service and past criminal convictions for battery are recommended.

8) Manor Executive Manager ("Butler" in the peasant vernacular)

The most prestigious job on this list is of course the MEM. Stimulate your mind through being the right hand man of your lord. Live in a castle, oversee harem disputes, negotiate with local serf overseers, arrange festivities, and meet a lot of interesting people while holding their drinks.

Required: PhD in organizational psychology and bachelors in public relations. Former work in the academia, knowledge of high culture, grasp on 2+ languages, and non-peasant background is a must.

9) Debt Prison Security Manager

Help prevent strategic defaults on debt and guard runaway serfs as they are given work to redeem their sins. Enjoy unparalleled job security, improved credit score, and better interest rates for keeping democratic capitalism running.

Required: Bachelors in finance and a degree from a police academy. Martial arts skills are a plus. Must have good credit rating standing.

10) E.S. Counselor (Environmental and Spiritual)

Help provide spiritual and practical advice to troubled souls. Nothing brings more joy than providing people with textbook approved scientifically backed meaning. This position involves improving the living habits of serfs through explaining the dangers of environmentally damaging material possessions, the value of honest hard toil, and how to secure loans for tools necessary to maintain your solar hut and plot of land.

Required: Masters in psychology and geology followed by 4 years of practicum on various serf reservations. Must be charming, have good grasp of peasant vernacular and luddite theory.

But how will I pay for all the schooling necessary?

Talk with your local E.S. Counselor about the various indentured technician programs available in your principality.

European Union Versus United States

Reserve Currency Fight to the Death? Part 2: Looking at pros and cons of major monetary competitors to see whose currency will collapse first



In part 1, there was background on why United States can now proceed with attempts to financially collapse the European Union. Although Washington-Wall Street Complex completely mismanaged the socioeconomic functions of North America for 40 years now, until 1999 there was always time and breathing room to kick the debt problem further into the future. The appearance of the euro on the scene automatically made EU a dangerous rival. This antagonism is more acute than ever in 2010. That's because the upcoming second dip of the economic collapse inside US would cement euro's role as world's reserve/best safety destination and send human resources (in form of American braindrain) back to the old world.

It is now common (and increasingly publicly admitted by the parasitical elites) knowledge that US and UK are worse off than EU in terms of debt and structural inability to do anything about it (rapidly export and grow their way out of the hole). However, the competition in whose reserve currency will pop first will still be close since each union has substantial strengths and weaknesses that are unique to itself.

The credit rating agency attack dogs have been unleashed ( ripping into those European players who were already weakened by banksters) around the time when world was moving away from the dollar in the fall of 2009. The PIGS countries problem can be seen as a grand diversionary tactic to distract from USA's fatal condition. EU, led by Berlin, has fired back recently in the form of American style 1 trillion euro bailout meant to make EU outlast United States. US will correspondingly now throw everything but the kitchen sink. Lets look at the match up.

EUROZONE: 

Pros -

1) Stronger political safeguards against banksters on average. There are better mechanisms at popular and pragmatic resolution of conflicts (proportional representation for most member states and also at continental level). People in member states have just a tad bit more say/power compared to financial parasites than people in individual states in US. It is slightly more difficult to loot Europe to the same extent as occurs(ed) in North America. This was evident in more rapid and gently more intense implementation of regulatory financial reform by EU member states since 2008. Less third world-esque socioeconomic conditions in general.

2) Trade balance with the rest of the world better than USA's. Depreciation of the euro helps European exporters more than American ones since they have more industry to make desired exports in the first place. EU has powerful states that can actually produce and export more value added needed goods such as cars and nuclear technology that non-Western world is ravenous for. Germany and France are more equipped than Texas and California in this regard (potential ability to keep non-producing states afloat and to strengthen the reserve currency via industrial production). Countries like Ireland have their healthy relatively debt free counterparts within the zone. Substantial gold reserves are present on the continent.

3) There is stronger infrastructure centric focus to give confidence to major world players in long term soundness of the euro. The continent is a lot more interconnected by high speed rail than US to keep real trade and growth going. Welfare state provisions in staples like education and health keep more money in the hands of poorer consumers to keep continental trade going on an individual level. In other words, Main Street is not as dingy, miserable, and desperate compared to its Anglo counterpart. This translates to better trained and educated workforce as a human reserve.

4) Direct investment business from abroad logistically easier. There are more neighboring non-euro using economies with a stake in the eurozone who bolster it through meaningful trade (fiscally prudent states like Norway, Sweden, and Russia). Hundreds of millions of  Eurasian peoples know who they'd rather see collapse.

5) Concentrations of ambitious oligarchs and political elites who understand the war preventing historical grand nature of EU project as a whole and who will go to radical measures to save it. Comparison can be made to elites behind US constitution (vast majority of ordinary people had no input in 1780s).

Cons -

1) Lack of American style centralized imperial leadership on continental level allows for same nationalistic problems that plagued US in early 19th century. Harder to justify subsidies to weaker nations even if their books and infrastructure are better than California's. Conversely, harder for leaderships of small nations to justify staying in the union. Threat of economic and political secession a lot more real. EU also has fewer and less powerful mechanisms to exploit and loot non-EU states the way US does. It therefore makes the continent more vulnerable to exploitation by oligarchs in US, China, and Russia.

2) Lack of numerical parity for euro use in the world compared to the dollar. Dollar still dominates and there is historic psychological comfort, investment, and commitment to it among the elites of the world. It's difficult to very rapidly disentangle due to professional careful research needed.

3) Lack of equally powerful credit rating agencies to hit back at credit worthiness of US states in retaliation. Lack of similar ability to project imperial power via naval and land forces to bolster euro as reserve and to humiliate dollar centric societies. Lack of European bases and troops on US soil as a form of intimidation. Pathological reliance on American elites for military protection and even ideological guidance. Not as capable (as Anglo counterparts) to create new financial instruments to throw against opponents.

4) Urban educated population a lot less controllable and less likely to go along with plans of EU leadership compared to their counterparts in New York, Portland, etc.


UNITED STATES: (one of course can just reverse what's listed above but here's a few key things to keep in mind)

Pros -

1) Physical ability and enormous propaganda megaphone to do mass diversions to distract from domestic and dollar problems. This can include anything from engineering a crisis such as a war or an economic implosion of EU's allies. The sheer amount of thermonuclear power that US has gives confidence to its "zone" as safety for the rich the world over. US is also able to manipulate price of oil more than any other entity and thus mess with the energy finances of the EU. Not mentioning the ability to just tell millions of investors the world over to not invest in Europe by downgrading credit worthiness. This will actually work briefly as a destabilizing tool when combined with other measures. Amazingly, enough people still believe in what credit rating agency swindlers say.

2) Better ability to do under the table deal making with Russia and China against EU's interests in order to preserve the dollar as reserve a while longer. Of course it may seem unlikely that Beijing and Moscow will go with Americans over Europeans but US has more things to offer with its military might. We don't know what a cornered animal is capable of in terms of switching policies and bargaining (see alliance building with Maoist China in the 1970s).

Cons -

1) Washington's bailout came way before EU's and now that it is running out there is danger EU can just outlast its monetarist competitor. US has already been looted thoroughly by the banks and there is little left to do in terms of paper shuffling. Similarly, there is little left to cut in US in terms of infrastructure and services. Unlike Europeans, Americans never created a solid welfare state to deconstruct and what existed was already reduced greatly over the past 30 years. If social unrest in US reaches Greek levels, then major powers will see the writing on the wall that (the historically tolerant) US peasantry has reached its breaking point.

2) Financial parasites in London may throw their lot with Europe thus creating infighting between Wall Street and London as centers of oligarchic power. This will depend on political decisions of the new British government. To see where rats from a sinking ship are headed (and what ship they're running from) will hint at what follows (note Wall Street higher ups getting increased police protection before the 2008 crash).

Overall it appears the European Union has an edge for short term survival of its currency. However, US has historically proven that it is capable of rather intense actions to bolster itself. We'll see what else is indirectly thrown at Brussels, Berlin, and Paris in weeks ahead and if they are able to muster equally intense counter attacks.

Energy Independence: How Much Nuclear Power Do We Need?

Fission and fusion power is the green cake of the future. Solar and geothermal is the icing. Lets make more cake.

The urgency and opportunity has never been greater for the world to engage in a large scale effort to mass produce third and fourth generation nuclear power plants. Only fission and then fusion projects can provide the concentration of energy (bang for your resource buck) needed to effectively power 21st century infrastructure like MagLev trains, desalination plants, and terraforming projects to turn deserts into farmland.

First, the recent nuclear disarmament treaty between Washington and Moscow provides substantial amounts of ready to use highly enriched uranium. Currently, 45% of nuclear power and 10% of total power in United States is already provided by dismantled Soviet warheads. The supply from new and future arsenal cuts (US has recently revealed it has 5,113 warheads overall) will push back peak uranium worries and create a situation where there is a lot more nuclear fuel than power plants to utilize it. Thousands of ready made warhead fuel cores are waiting to be used as we speak.

Second, there are signs that increasing numbers of America's oligarchy are concerned about being humiliated by the Chinese and Russian elites when it comes to making money off nuclear reactors internationally and acquiring corresponding prestige. This is significant in that the luddite rich kid baby boomers, former ivy league hippies, and gravediggers of FDR's infrastructure policies are coming around to the idea of reawakening the nuclear engine of growth in the 50s and 60s. This was noted in Obama's semi acceptance of McCain's nuclear energy proposal during the state of the union speech. The number of new reactors pushed by the administration is inexcusably low now but they can be a political foot in the door towards future construction. Additionally, a key player in the military establishment (General Electric) has used its propaganda arm (NBC) to start a national nuclear energy discussion with the documentary The Nuclear Option right around the time when GE was swinging financial and propaganda support towards Obama's election. National discussion of any serious issue with potential for massive societal uplift and transformation is very rare these days so the mere existence of a widely broadcast pro-nuclear energy documentary is significant (imagine if there were documentaries on NBC that slam federal reserve, military industrial complex, and insufficient taxation of the rich).

Third, the historic oil spill in the Gulf of Mexico has the potential to be "oil's Chernobyl". That is, to psychologically imprint on the youtube generation's mind that pushing Hubbert's peak through shale and offshore is very costly and deadly compared to fission. Nuclear energy serves as an important point of political contact and agreement between young (educated) environmentalists and young conservative nationalists. De Gaulle's nationalistic model of energy independence for France through safe clean mass nuclear power serves as a continuing example to emulate and rally behind. Since Russia recently spurned French nuclear industry (through an alliance with Germany to mass construct nuclear reactors for sale abroad), US has a chance at genuinely constructive and mutually beneficial outreach to Paris.


So how much nuclear energy do we need?

As much as can be made at any given time. The need resembles bullet making in wartime. What people need to remember is that nuclear science does not stand as relatively still as coal/oil burning science. Third and fourth generation reactors stand to be exponentially more powerful (think Richter scale) than their first and second generation cousins. Fission technology is evolving and will continue to produce more and more energy per pound of uranium until new sources of high intensity energy are ready for application (fusion). US would have been energy independent long time ago if construction of newer and newer reactors continued at same pace as in the 50s and 60s.

As of 2006, world's energy production rose to 472 quadrillion Btu from 283 quadrillion Btu in 1980 (66% increase). World's population in same period has grown from 4.5 billion to 6.5 billion (44% increase).

That is pathetic and criminal if one looks at it from perspective of enforcing the UN charter of human rights.

In more than 25 years since third generation nuclear reactor technology became a reality, there has been just 18% growth in how much average energy is available to a human on this planet (73 million Btu per person versus 62 million in 1980). This would obviously be horrifying even without the fact of exponentially disproportionate use of energy by some homo sapien over others. The amount of available energy per person should always be exponentially increasing if humanity is to survive and prosper through terraforming, high tech agricultural/water projects, and space exploration.

Western technological luddites and fear mongers always explain how each person on the planet cannot have the same "way of life" as a middle class Westerner (living in poorly designed suburban sprawl) . The current planetary energy policy (or lack of it) makes that statement not only true but hints at the genocidal implications if it is continued. The problem boils down to:

a) Necessity of people in the southern hemisphere to skip the inefficient suburban residential infrastructure lifestyle step (lifestyle that young westerners are moving away from through migration to urban centers) and go straight into high tech urban living (the way some rural areas of India went from no telephone straight to wireless broadband)
b) Insufficient energy available to world's poorer people to power machines that extract/refine commodities, power machines in utilization of these commodities for construction, power the new construction in order to even have the inefficient suburban infrastructure that they need to skip

Solution to this two part problem lays in mass production of new reactors that are spread over the planet in a way so there is roughly same amount of energy available per human. This average energy amount would be growing annually. Such kind of energy egalitarianism would bring enormous environmental benefits as 2 billion poorest people leapfrog over (instead of repeating) the 20th century residential construction process in the West. Of course, this new energy could be used for suburban construction but if average income Westerners and Asians acquire ability and will to build and maintain high density futuristic cities (that make Portland seem inefficient and provincial), then that becomes the role model lifestyle instead of American style urban sprawl.

The growth in total energy available to humanity should always be accelerating and not be pegged to population growth (such as energy growth 3-4 times the world population's and no more). This would prevent global violence and struggle over commodities by allowing advanced nations to build mass infrastructure for themselves as well as for southern hemisphere simultaneously. Most importantly, with sufficient growth in amount of reactors, oil and coal fueled suburban lifestyle will actually be more expensive in comparison to planned nuclear urbanization. Same way as suburbia powered by burning wood would be ridiculous in comparison to an oil powered city. In the process of moving straight from subsistence living to a concentrated density nuclear city, a lot of environment and human dignity is saved. As of today, urbanization is still happening around the world but only in the horrid slum expansion variety. Poorer countries have plenty of resources to barter in exchange for reactors. There are even small floating reactors being developed now that can be towed to client's ports.

Imagine the possibilities and what people would have done if 1000 modern coal power plants appeared in 1880s America. Similar societal gain is possible with international UN/G20 backed fission/fusion campaign. The entire world would become equally developing since the concept of Western suburban house and an electric car near it would seem ridiculously archaic and inefficient goal to strive towards. With sufficient power, completely reimagined and modular cities of the future are possible that are linked by MagLev trains spanning entire continents. With enough power you can have enclosed organic farms in the most inhospitable of areas. With enough power you can utilize larger and more advanced mechanized forces do extract more resources out of the ground cleanly and better reuse materials harvested from older cities/buildings. Most importantly, more energy production allows power to be basically free for individuals and small light industry businesses.

Fission power today is only 15% of world's energy production but can be rapidly expanded to over 50% with sufficient international cooperation. BRIC countries are already engaged in slowly revving up potential for mass production of third generation reactors. The trick towards entering the 21st century rests on tapping the economies of scale for large capital intensive projects. Each additional reactor will be cheaper than the last as well as the retooling machinery upgrades. The process needs to be international in scope and streamlined the way some weapons manufacturing is during wartime.

Hopefully USA's oligarchy will finally accept reality and necessity of collaborative nuclear power plant construction sooner than expected (as much as they'd hate the side effects of empowerment, improved quality of life, and better infrastructure for the peasants that it'll bring). Geothermal and solar do have their complimentary roles to fission and fusion but as an icing on the cake of macro technological progress.

Hoover Presidency and Obama

Hoover, a capable technocrat dealt with a deepening depression by trying to improve status quo fundamentals rather than trying to bring new fundamentals into being. Obama, a year into his presidency, does the same but worse.



Timing is everything. When a Republican held on to the presidency during 1929-1933 period of deepening international depression, half a century of Democratic party governance followed (with last vocal remnants arguably stamped out in 1994). Population's psychological association of Herbert Hoover's GOP with worst financial catastrophe in memory and inability to substantially remedy anything (during a 4 year downward spiral) was total.

These days, Hoover's name lives in infamy even though he was a brilliant and very capable micromanaging technocrat. Just like Carter, he was overseeing macro scale global decline and similarly to Carter, did not have the will to radically break from the status quo establishment modes of thinking. The reason for them not breaking with the past too rapidly is that grand declines happen over a period of years with a number of positive reversals. The gradual nature of decline allows the psyche of the political leadership to adjust to increasingly worsening reality (which would otherwise be intolerable if decline occurred in say, 2 weeks instead of 2 years). For example, after Great Crash decline of 50% from 381 to 198, the Dow recovered 33% of the losses by summer of 1930. That was the first of the great sucker rallies that continued until the ultimate bottom and socioeconomic emergency in 1933.

Hoover's administration did not have as many data metrics as exist now (concerning homelessness, hunger, etc) concerning true economic situation on main street. For guidance, they thus overly relied on the casino gambling chart for the rich (that is Dow Jones) even more than Obama administration today.

Here's how that chart looks today:

The current sucker's rally got the gambling chart up to almost 60% in 2009 from its post crash lows. Internet trading advances allow more players with better communication to participate. This means even greater potential for volatility in general (large negative and positive reversals) than in 1930s. When Hoover was in office well into the year following the collapse, his chart looked like this:

Does not look all bad right? Perhaps it looks as if some nuts and bolts need to be tightened by a gifted team of technocrats and the great bubble machine will be up and running again? Although the time for relatively radical measures (FDR style attempts to preserve capitalism) was perfect, these measures would have been politically impossible and were not seen as needed. The rest is history. As tax revenue for government to do anything increasingly dried up, Hoover had less and less tools at his disposal. His administration was in the classic gambler's dilemma of hoping for a reversal while riding an incredible wave all the way down.

The current economic depression may be even worse for United States than the last one in a number of key respects.

1) There is a lot less industrial capacity to fill up than there was in 1929

2) Unemployment after 2008 crash rose a lot quicker than after 1929 crash. By same unemployment calculation standards used in 1929, we are approaching 25% real unemployment already whereas it took 4 years in 1930s for it to get that bad then. If we mimic the Hoover era descent as well as we did the crash (half the gains gone bringing Dow back to 1996 level within months), we'll reach real unemployment of over 50% by 2012. Argentina, with half of its population below poverty line is a good recent example of what we can expect once the dollar default occurs (regardless of the form it takes).

3) Other great powers DO have often greater and often newer industrial capacity to outcompete us even if there is a political decision in Washington to use state capitalism to climb out of the depression using China-esque mercantilist system and industrial exports.

4) The government debt and budget expenditures (proportional to the size of the economy) are greater than in 1929

5) Ethnic divisions are a lot greater than in 1930s due to the number of white Americans being below 70% of population versus being over 90% in 1930s. This may hinder government acquiring enough political will to engage in real nationalist safety net provisions.

6) Modern American oligarchs are internationalists and have better means and will to move their wealth and themselves abroad if needed

My full article outlining the historical context of diminished means to climb out of the hole compared to before and some means left to Obama administration's disposal can be found here.

Obviously 80 years of technological progress means that welfare provisions will be a lot more tangible once social mindset turns towards providing them. This depression will be a lot more physically comfortable than the old one just because gadgets and developments in social sciences advanced greatly. This however does not eliminate the psychological pain born out of comparisons, thwarted expectations, interpersonal alienation (due to better communication technologies versus in person contact), and collapsing national morale of people who fancy themselves as citizens in a "superpower".

History would have been neatly repeated politically if McCain got elected. The resentment based oligarchic GOP socioeconomic structure (that Nixon first hinted on and that Reagan entrenched) collapsed under its weight in 2008 under GOP president. McCain's poor neural circuits and inability to generally surround himself with prudent people (although he did use Romney for financial advice in Sep and Oct 08) means that he would have dealt with the downward spiral even worse than Obama.

(sidenote: Of course it's possible he would be too old to care about politics as usual and would have started emulating his hero Teddy Roosevelt by turning on Wall Street. Such speculation about the "real" McCain or "real" Obama coming out when in power is useless. It's enough to keep in mind that crisis would continue deepening under the watch of another GOP leader).

It may sound ridiculous to think McCain would have accomplished even less than Obama by now but we must remember that even Hoover, the technocratic wonder boy, couldn't do much. McCain's sheer presence and belligerent posture would cause greater capital flight out of the country and quicker movement from dollar as a world reserve. Bailout to first class passengers (Wall Street) leaving the slowly sinking ship would have continued.

So now we have a rather interesting situation that just when the GOP has totally burned itself out and is in the process of disintegration, the people are associating their tangibly felt decline in living standards with the newly ascendant democratic party. Although this does not mean the democratic party will not keep winning in next elections (due to GOP infighting and shrinking economic pie with which to reward supportive factions), its potential to emerge as a monolithic long term juggernaut is greatly diminished.

Exasperation with both political wings of the oligarchy leaves people without a scapegoat for their psyche and opens the door to radicalism and rise of regional (rather than national) power centers. It remains to be seen if the key members of the international community will find it worth their resources to step in to bail United States out (to prevent potential long term geopolitical headaches stemming from social unrest in a state with many nuclear warheads and to profitably pick the bones of the country in the process). Although the bailout infusion has delayed the dollar default, it just made its consequences worse once it arrives.

On a more cheerful note, here's a political cartoon from 1930s.

Protectionism Works

Protectionism is what made every historically major country wealthy and powerful in the last 300 years (including the current free trade pushers like UK and USA). Protectionism should stop being a bad word as Japan and China can testify


The title may make the reader shake head immediately because a kind word is not often found with "protectionism" in the same sentence these days. Although United States industry was essentially built on protectionist tariffs (until 16th amendment of 1913 allowed federal government to start functioning via income tax instead of high tariffs on imports) the last 30 years involved continuous top down push of free trade propaganda. It is thus understandable that protectionism brings a negative psychological reaction even if there aren't ready made arguments to explain why.

If one looks at how world's key societies rapidly became wealthy and powerful (in the last 300 years), protectionism was always the dominating factor to help out native industry. France and England in 18th-19th century, United States, Japan, and Germany in 19th-20th century, and China in 20th are just some of the success stories.

In fairness, we can't overlook a number of small (population and physical size) states that are positioned to thrive in free trade by their geography (ocean reliant ports of Singapore, Hong Kong, Netherlands and Switzerland with its base in ancient Alps trading routes) which often also function as financial hubs. As far as large historically active players on the world stage, all became what they are due to basics like tariffs.

One may begin to argue that protectionism of old was different in that it was an ideological pillar of now "discredited" mercantilism. However, mercantilism never went away and still works wonderfully in more advanced forms in China and Japan (and even in Western Europe to a certain degree). Certainly we can understand the desire of a state to lower protectionist measures once its industries have sufficiently grown and benefited from them. We have seen England begin to push free trade propaganda in 19th century after its factories became the best in the world. Same pattern continued with United States (which had some of the most advanced and some of the only factories left standing) after World War 2.

One would think that United States would learn a lesson from slow decline of British Empire (late 19th century to 1960s) due to transition from mercantile protectionism to free trade and reserve currency imperialism. Surely it would have affirmed that lesson from the rapid rebirth (after the initial breathtaking success of their mercantile industrial expansion in late 19th century) of Japanese and German societies in the 1950s ad 1960s. It was crystal clear what works for national enrichment, job creation, national self respect, technological progress, and higher quality of life for the average citizen.

It can be summarized as follows:

1) Tariffs work, keeping out foreign competition and their advanced imports such as cars works, trade barriers work, high import duties work, allowing foreign companies to set up shop only in partnership with native companies/unions works

2) Free trade doesn't work as well as trade barriers historically when it comes to rapid national development and can even fatally drain a nation

For a number of years before the current economic depression hit, many old time free trade warriors like Nobel prize winning neoclassical economist Paul Samuelson began to realize that the global reallocation of industry can produce a domestic win-loss scenario for United States (especially in its trade contact with protectionist China) where the loss is so great as to be socially catastrophic. Samuelson used to have absolute faith in comparative advantage but his most recent major paper argues that free trade theory needs to be reformed for the modern world if it is to survive. Samuelson is too old (94) to meaningfully contribute at this point but major reallocation of his thought at this age shows the seriousness of free trade problems. One translated Der Spiegel interview has him mouth the thoughts familiar to anti-WTO protesters: that rising economic inequality within "globalizing" nation is a type of win-loss scenario that is unacceptable and stupid to be allowed to happen.

Another crusty dinosaur, Alan Greenspan, has mentioned a few years ago how rising inequality can threaten democratic functioning of United States. When free marketeers and capitalist internationalists utter words like these, it's the equivalent of John McCain saying that perhaps United States naval forces should be cut down in size. It's the equivalent of the Pope saying that perhaps some birth control should be introduced into church doctrine to save lives. Some of American elites (mostly in the nationalist democratic wing of the American oligarchy) have taken notice of this.

At this point, rapid and badly needed protectionist measures may shock United States into falling further into the economic abyss. Chinese retaliation and corresponding rise in cost of imports will not help United States get further away from risk of a hyperinflationary scenario. It would thus make sense for Barack Obama to sneak in defensive nationalist measures gradually. His recent decision to to impose a tariff on Chinese tires may be beginning of such an attempt. Tariffs on foreign made car batteries and materials/parts connected to industries decided to be"strategic" ( like green energy ) may follow. The way protectionism is introduced by the current administration will be vital for any chances of American rebirth within a generation.

When pound sterling began declining as reserve currency in the 50s and 60s along with British industry, London decided to cut off its foreign colonies for purposes of national regeneration and survival. United States needs to begin a similar process of disengagement from the world to match decline of the dollar as reserve. Since British Empire and United States were both in strong imperial position at the time of their full commitment to pushing free trade on the world, they found it easy to combine lack of protectionism with parasitic existence of unproductive consumption through the use of reserve currencies. In that sense, free trade "worked" for them for a while even as it impoverished small countries that were pushed to engage in it. This period is now coming to an end and a new model has to be formulated.

Some Europeans, like Emmanuel Todd, propose "protectionism on a continental scale" (the article is in French but is very readable with google translate). It may be argued that China already practices that to a degree in that it has the population and economy large enough for import restrictions without being crushed and impoverished. European Union definitely has what it takes for such an action especially if it coordinates with some nearby states like Russia. North American Union and South American Union may one day be such entities to effectively fight off Asian and European imports. Trade cannot be decoupled from production and effective production needs to be able to compete between itself rather than just exist in one part of the world where it's cheapest.

Let's hope some common sense prevails and more people question official orthodoxy of global unification by only one narrow "inevitable" route (the optimism of Thomas Friedman is now laughable in hindsight). Real globalization seems a lot more within reach when self enriching, wealth producing, continent wide economic unions do business with one another in a more equal way.

Lets remember what the 25th president of the United States William McKinley said about free trade at the end of 19th century when he affirmed a commonly held belief among American elites and citizens,

"Under free trade the trader is the master and the producer the slave. Protection is but the law of nature, the law of self-preservation, of self-development, of securing the highest and best destiny of the race of man. [It is said] that protection is immoral…. Why, if protection builds up and elevates 63,000,000 [the U.S. population] of people, the influence of those 63,000,000 of people elevates the rest of the world. We cannot take a step in the pathway of progress without benefitting mankind everywhere. Well, they say, ‘Buy where you can buy the cheapest'…. Of course, that applies to labor as to everything else. Let me give you a maxim that is a thousand times better than that, and it is the protection maxim: ‘Buy where you can pay the easiest.' And that spot of earth is where labor wins its highest rewards."