Tuesday, December 1, 2020

The Great Reset: Why Bother?

You have to hand it to them. The architects of the Great Reset certainly think big. Gone are the days of tinkering around and incremental changes. Nope, they propose to chuck the whole Western economic system and tear up the social contract and replace it wholesale. If they succeed, the entire world order will change.

At first it might seem like an awful lot of effort. Why reset the global economy when you are already incredibly wealthy? The gap between the ultra rich and the rest of humanity is already enormous and keeps growing, what more do they want?

As I have said before, the real allure of being rich is not being able to buy more stuff than other people. The real allure is psychological, feeling that you are just better than everyone else. It is very much like many rigid religious systems. Being "holy" is mostly about not being like people who are less holy. This is why people who win the lottery are so rarely happy. You can't buy your way to happiness. Being White trash with a Ferrari doesn't mean you aren't still White trash. Look at black pro athletes with all of the money you could imagine and they still act like they live in the ghetto. In my banking days I saw this often, someone poor coming into a bunch of money, blowing it and being right back where they were. I remember one young Indian woman in particular, as an Indian she got a lump sum check from the government for some reason. She came in and deposited it and then I watched as she and her loser boyfriend, who lived with her in a crappy trailer, blew through every penny in no time at all. Then he left her. It was well over ten grand, it would have been a nice start to building something but instead she just pissed it away and she was hardly the only example of a young Indian kid from that tribe I saw do the same thing.

Remember, the bigger the gap between the ultra-rich and everyone else, the happier they are.

Something that irritates the very wealthy to no end is that normal people can rise above their station in the West. For a significant chunk of the last century, it appeared that the economy could grow indefinitely. This was especially true from around the 1950s to the 1990s. 

To understand this, you need to understand the basics of the U.S. economy for the last hundred years.

In the post-World War II era, the economy expanded rapidly in the U.S. because we were largely untouched by the war. Our factories and farms were in great shape and our competitors internationally were kind enough to destroy each other, leaving the U.S. as the sole superpower. If you could get some financing and with a little luck and a lot of hard work, you could create a new business that would expand and create jobs and wealth. Much of this economic expansion was value added, meaning taking a raw material and adding skill and investment to increase it's value.

Suddenly people who came from modest means were buying vacation homes and second cars, TV sets and consumer appliances. The middle class grew and grew. Even guys without college, as most people weren't going to college yet, could work a blue collar job and support a family. Northern Michigan is a prime example of this. There are plenty of very high end homes up there owned by the ultra-wealthy but most of the cabins and small homes on the lakes are owned by blue collar workers, especially UAW autoworkers. Every lake house you drove past had a brand new Chevy or Ford pick-up with a trailer and a bass boat or jets skis. Where I grew up, my dad and the other doctor in his practice lived 5 houses apart but the people who lived between them were just regular blue collar workers. Doctors and professionals lived side by side with factory workers and tradesmen. 

Then that started to change. Two big factors led to where we are today with a largely collapsed middle class.

One was exporting jobs overseas. Blue collar workers became the victims of their own success and the avarice of corrupt union bosses. With no competition, wages kept inflating without much hesitation. At the same time, the rest of the world began to rebuild. It might be hard to imagine now but when I was a kid, "Made In Japan" was synonymous with "Piece Of Shit". I had a buddy in high school named Andy who had a Toyota Corolla that looked a lot like this.....


Manual transmission, no guts at all, crap stereo, it was a great car for a high school kid because you really couldn't get it going fast enough to get in a serious accident. Hideously ugly to boot. 

Then things started to change and the Japanese started making cars that were more affordable, and although it was a mortal sin to say this in Toledo, often more reliable than American cars. My sister had a silver Honda Civic that was one of the earliest models of that auto and it ran forever. The Japs started to make electronics too, cheaper and more efficiently than we could, and with global shipping getting easier it was more cost effective to make this stuff in Japan and ship it here. 

As a result, more and more American workers shifted from making stuff to selling stuff made overseas. This was portrayed in That 70s Show when sitcom dad Red Forman lost his job at a factory and became a manager at "Price Mart".


Pretty soon, the corporations kept getting bigger and the pressure to reduce costs kept increasing and some untapped labor markets were discovered, mainly China and Mexico. Shipping costs continued to shrink making overseas production more viable. More manufacturing went overseas, more Americans moved out of making stuff and into reselling stuff via retail. Of course quality also suffered. Items that used to last for years now lasted for months. The proliferation of Wal-Mart and dollar stores making a profit selling cheap stuff cheaply meant moving lots of product and if that resulted in garbage that needs to be replaced every six months, all the better. The example I keep coming back to is a laundry basket. Growing up, my mom used the same basket for years and years, and she did a lot of laundry, plus as a kid I often flipped it over and sat on it, hid under it, trapped cats with it, etc. Today a new laundry basket from Dollar General or Amazon is garbage, flimsy as soon as you get it and it splits after just a few loads of laundry. Sure it is "cheap" but in the long run that doesn't mean inexpensive. 

Today it is tough to buy much of anything made in America. Just browse through consumer goods on Amazon and see how many are made in China. We are a nation that doesn't make stuff, we are a bunch of people selling stuff made overseas to each other for crap wages.

The second thing that happened and keeps happening is debt. The entire Western world is awash in debt, so much that we can't even imagine it. Most people can't comprehend a million bucks. I saw a cool million in cash once when I was a banker and it was kind of underwhelming but the average person has no clue. I used to work in financial services and banking so a million I could sort of understand. A billion? That is beyond me, even when I had some retirement plan clients with billions in assets. It was a make-believe number.

A trillion? No one understands that. No one can grasp a figure that equals the cost of buying over six million of the homes I live in. Two trillion dollars is more than all of the Federal reserve notes (i.e. dollar bills, $1 to $100 denominations) all gathered together (see Currency Confusion for more about cash versus money).

What about $5 trillion? Or ten trillion? At that point the numbers are just make-believe. We are at $27 trillion in our national debt and climbing as I write this.


Our debt per tax payer is over $200,000 and our debt today is over 128% of the U.S. gross domestic product. That means that if all of the economic output of every American, every worker and farmer and factory, were applied to the debt for the entire year, it wouldn't even pay off the outstanding debt in full.

That figure blew up under Obama and then kept right on blowing up under Trump and when Biden takes office? Expect that number to go into unimaginable levels, as if they aren't already.  

It isn't just the national debt. American citizens are enormously indebted. Credit cards. Mortgages. Car payments. Student loans. Much of the income of average Americans goes to simply servicing their various debts.

Way back in the 1950s, household debt was a fraction of the U.S. GDP. People believed in stuff like saving up for things you wanted, buying a starter home that you expanded or sold to move into a larger home. Most families only had a single car. People barely old enough to vote weren't given unlimited access to unsecured debt via student loans. You couldn't get a mortgage with little or no credit and no down payment. 


Household debt has been at least 70% of the GDP for most of the last two decades. It dropped some as the recession faded but in 2020 it is spiking again....


I assume that two things are leading to this, first people who can't work/won't work but are still spending and also people sitting around on their computer all day. If you look on the internet long enough, you can find something to buy.

This has led to an incredibly fragile economy, with the power brokers spinning a bunch of plates at the same time, knowing that if one crashes, they all crash. For months at the beginning of the "pandemic", our stores were stripped bare of essentials like disinfectant and toilet paper. Many items were out of stock for months or rationed, like fresh meat. This has led to local butchers being booked solidly for years. We had a steer butchered last week and he was way overdue but that was the earliest we could get him in and I made that appointment in March. The guy who runs the shop said they are booked solid until September of 2022. That is not a typo. 2022. Animals not even born yet are scheduled for slaughter already. Millions of people are in very real danger of losing their homes. Tax revenue is certainly down by a huge amount across the board. We are in a precarious position but so far it hasn't completely crashed.

That perilous perch can't keep going forever. Something is going to break. When it does, things are going to go badly. So many people are working in jobs fueled by debt that without an unlimited ability to take on new debt, the economy will crash and then the peasants are going to get out the torches and pitchforks.

John Wilder has a good post on this topic, you should read it: The United States And The Road From Abundance To Bondage

That brings us back to The Great Reset.

Why are billionaires pushing so hard for this? In part because it will make the rest of humanity equally poor and increase the gap between the elite and the rest of us and that makes them happy.

But it is also because they are scared. 

Since the French Revolution, the elites have been terrified of the peasants. It is pretty easy to control peasants one at a time using the power of the state. But when you have millions of them? That is a road that leads to guillotines. 

Six billion angry people with starving kids are going to look for someone to blame. You can deflect it a little but pretty soon the people with the mansions and private jets are going to get noticed. When the peasants aren't reliant on makeshift weapons like pitchforks but instead are already armed with over 400 million firearms? That makes it a million times more frightening.

Think about that and you start to understand why gun control is such a major issue for people like Michael Bloomberg. Loathsome Li'l Mike can hear the sounds of the mob and knows when they come, they are coming for people like him. Perhaps without Orange Man Bad to blame, regular working people will realize that both parties and the entire government is working hand in hand with corporate America to destroy what is left of the American dream.

You just need to read or listen to what the elites consume for "news" to understand this. What they are bombarded with daily is brimming with anti-middle America hatred and especially fear. They don't understand people who like to hunt and fish, who don't want to live on an island covered in concrete and think that family is more important than being on the guest list for the best cocktail parties. They really think that away from a couple of urban enclaves, America is a violent wasteland with rednecks in pick-up trucks with Confederate flags, driving around looking for blacks or faggots to attack. They are terrified of us. 

Some of the key points of the Great Reset are that people will be locked into cities, where they can be watched and controlled, and that they will get whatever they want to amuse and distract them as long as they keep their mouth shut. Legal pot, endless streaming videos, delivery foods and a universal basic income. It is basically bread and circuses gone digital and virtual. Most important, it keeps the people content so they don't start sticking billionaire heads on spikes. You think that Jeff Bezos and Mark Zuckerberg aren't getting a little nervous? 

The "Why?" of the Great Reset is both offensive, using the threat of a man-made "pandemic" to finally push back the bourgeois middle-class that clutters up the privileged spaces of the elites, and also a defensive mechanism to head off a new anti-elite violent revolution. Being insanely rich isn't worth much if you are swinging from a lamp-post. 

5 comments:

  1. I worked for a large corporation several years ago and it was always interesting that no matter how poorly the company did the CEO always had his pay structured in a manner that he received hefty bonuses. It was almost as if the board wanted to reward him regardless of whether or not the stock price tanked. I had to do the ground work of cutting head count, closing factories, moving some production to Mexico, and a multitude of other unsuccessful measures to avoid bankruptcy. When bankruptcy came we were bought out by a bunch of NY Jews...oy vey! I'll stop the story there to say that the elites merely view us as a commodity. We are encouraged to invest in 401-k's that support this corporate charade. In essence we buy the seeds of our own demise by supporting our corporate overlords. Then when the next bubble pops...oops...sorry you lost that "money" too. Don't worry though, by the time you are 105 you should recoup your losses because the stock market averages an 8% ROI over the long term!!! One corporate guy actually told me directly..."Don't worry about the ones you let go, they'll find another job." If justice should ever prevail I promise I won't shed a tear for those @$$h0les and what they've done to hardworking Americans.

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    1. Almost as bad as the architects of the decline of Western civilization are the collaborators, the people who know enough to see what is going on but look the other way and keep silent because their own pockets are being lined. There are a lot of them and it would be smart to work on your carpentry and knot tying skills.

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  2. Nice work today Arthur. Ive been asking myself "why" for a long time. I never once took their fear into account, just their lust for power. Am I wrong to feel energized and hopeful at the thought of the "elites" quaking in their boots? A real eye opener Sir. Thank you for putting a much needed smile on my face today.

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    1. Much of their high minded rhetoric and arrogance is a mask for their fear.

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