The Hyperreal Economy

I have bad news for you. American currency is not what it used to be. And we are no longer a beacon of freedom to the oppressed of Earth, no matter what Bush and Cheney are selling. Disaster capitalism. Hostile takeovers. Terminology hiding the same authoritarian impulse. We're now a people under a spell, and there's nothing that the Federal Reserve can do about it.

In what may be the most poetic of timings, the Fed is set to publicize their secretive assessment of the state of the American economy on Halloween. Think the living dead meets the dying dollar, and you're there. It should make for compelling cinema.

In short, the stock market rises and falls on the Fed's mere words, proving that it is indeed language not liquidity that is the currency fueling our capitalist engine. And while the focus is on the cash and bling of hedge funders and hip-hoppers, the truth is that money is a lie. It's simply information, exchanged in symbols. Paper, gold, silver, whatever. We used to trade in ochre and livestock. What matters is the matter at hand: How our consensually established value enhances the world-at-large. If it doesn't, it ceases to be currency. It becomes oppression.

I wrote about this fucked up condition for AlterNet recently, calling it the hyperreal economy. But those are just buzzwords, built in hopes of attracting attention to what is becoming a very serious problem. From the dominance of electronic stock transactions and worthless IOUs called naked shorts to craps, misinformation and the impending loss of American nationhood, the new millennium's globalized economy might as well be The Matrix. A loosely managed game theory, coming apart at the seams.

Having researched the game above our heads and talked with economists and CEOs on either side of the political divide for the last year or so, I have come to realize that economics is just another game of chance, which like all games need language to breathe them into being. And so when the Fed comes out this Halloween offering dull wonk talk and a quarter-point rate cut, it's almost a certainty that stocks will rise as more and more rich people cash out of the faltering American empire. Like I wrote for AlterNet, all of them know that a recession like few we've experienced is coming. The only question now is whether or not it will occur during a Bush administration or a Clinton administration. The chess pieces have all been placed. The battle is on, and we're all just pawns in the cash grab.

Here's the short version: By the time the Iraqmire ends, we'll be trillions in the hole. The end of oil will throw our once Great Society into chaos. American dollars, already on a decline more than slightly resembling the Titanic crashing into an iceberg, will tumble from respected to reviled. Throw some global warming into that mashup and you have hell on Earth.

The only question left is what we plan to do about it.

We are on the cusp of both disaster and greatness, defining the double-edged sword with every step we take. The Bush administration has broken our mirror of wholeness, illustrating the narcissistic horror an empire at wane can wreak on the world that once considered it the pinnacle of social achievement. We can either absorb that tragedy and evolve, or dig deeper holes in which to hide. Regardless of what the Fed decides on Halloween or which party wins the White House in 2008, we are in danger as a people. In the decades to come, it's not Iran or China or Russia or anyone else who will screw our futures.

No, our planet is going to become our worst enemy, if we keep treating it like shit. The science is in. The rest is propaganda or diversion. We need to pull it together. We need to innovate like our lives depend on it. Because they do.

Comments

[joebaggadonuts]

Scott.

Love your work. You could write lyrics for some bands and get music behind your message. Music moves souls and we need lots of movement.

Thanks for all you do!

joeb.

[morphizm]

Thanks, Joeb. That's about the nicest thing anyone has said to me on the HuffPo.

Scott

[horhay]

I agree. We need some good new music if only for the fact that there isn't much out there. But also to enlighten and inspire the masses, to push back against the status quo, to take it to the next "level".

[mrcontinental]

GLOBALISAT­IONisBARBA­RISM

Here is a link to an excellent article by F. William Engdahl on the dollar system. If you are not familar with his work take a good look around the site because he is quite gifted.

http://www.engdahl.oilgeopolitics.net/1973_Oil_Shock/Dollar_System/dollar_system.html

[GLOBALISATIONisBARBARISM]

Thanks. I’ll do it.

But just a note for the (hypothetically, hopefully still listening, in great numbers) people who are asking for practical policy solutions, William Engdahl is a person very positively referenced in the publications of the LaRouche movement, whose message of “rediscover FDR” (no, more exactly: “Rediscover/-enact the true, orginal American System of Political Economy - as opposed to free-trade imperial, monetarist schemes like globalization! - ... as was last, best approximated by FDR”) I am trying to relay here as the only promising solution.

[mrcontinental]

No one can deny LaRouche's brillance, he has an incredible grasp of the current system and for all practical purposes his reforms would improve the system. The problem is no one wants the system fixed because as long as the present ponzi scheme continues to work that 1% continues to rule. The thought of a fair system for all goes against everything these people believe and they would rather the whole thing collapse before giving up any of their billions to fix the problems. I mean we are talking about people who don't even want to pay their fair portion of taxes.

Only the complete death of the current dollar system will save the world and unfortunately by the time america recovers we will be totally irrelevant to the new global economy. Maybe then we will dust of the Constitution, start from scratch and apply the true spirit of it...you know the Life, Liberty, and pursuit of happiness part. While we are at it dust of the Bill of Rights as well.

[balance]

Trouble is truly brewing for the US economy.

The strong dollar is a big factor in the American quality of life -- it is something we take for granted.

But look at countries with weak and declining currencies, and what life is like there for average people. When credit is tight, it becomes harder for businesses to hire. When the local currency is weak, the buying power and actual wealth of the people is lower.

It can be evident that this may be in store for average Americans in the future.
Large corporations and the elite however, can still thrive under such conditions, a quick look at other nations with large numbers of poor, can reveal that the wealthy elites & powerful corporations can thrive and maintain power in such conditions.

In addition, downward pressure on the Dollar may be good for corporations and for exports, but they also spell trouble for US Consumers and quality of life costs.

For the non-rich, the cost of living will skyrocket.

The weakening US Dollor, combined with increasing energy costs, increasing health care costs, increasing education costs, increased housing costs, and it is obvious that there is a long term economic crisis looming for ordinary Americans.

--And very few in the establishment seem concerned.

The Bush administration has played a huge role in increasing Oil prices with the Iraq war, and with pursuing an antagonistic & non-diplomatic course with many other oil producing countres: Venezuala, saber rattling with Iran & Russia, etc...

The corporate media also seems to be apathetic towards the middle class, since corporate profits won't be hurt with a decreasing dollar and with offshoring work. But increased corporate profits won't necessarily trickle down to the rest of the American populace.

Many countries with strong corporate exports & weak currencies have a populace that struggles to live hand to mouth. -- Except those with strong social & government safety nets, and America doesn't have that.

More people should understand what sort of economy & mess is in store for the next administration to clean up and deal with.

[Visceral]

OK, we're fucked ... but what should we be doing about it? Moving to a stabler country? Buying gold? Learning to farm?

Platitudes aren't enough - we need specifics.

[MilwaukeeDan]

Visceral, I don't think "we're f**ked", but you ask the right questions. Someone recently stated that "in Europe, the government fears the people, while in the US, the people fear the government". The problem is we elect new represenatives but we get the same thing, not much changes. The powers that really run this country(mu­lti-nation­al corporations) want the status quo and they get it. Americans have had it too easy for too long and only a catastrophic occurence will wake them out of their stuper(no Monday Night Football). The wife and I have purchased Euros and we rehabbed a home on her familys farm property in Europe. It's all we could afford to do, and we have no debt. I don't think Social Security or the 401Ks will be around after we retire so we wanted a fallback plan. peace, danilovic

[GLOBALISATIONisBARBARISM]

MilwaukeeDan: To my best of knowledge:
(I) You ARE f**ked, unless an orderly bankruptcy reorganization of the dollar system is undertaken, starting with such a thing as LaRouche’s Homeowners and Bank Protection Act (HBPA). Go google for it.
(II) The “Someone” is mistaken. No government in Europe, so far, has any fear of its people. They are afraid of those elements who have it in their power to denigrade any government for incompetence to please “investors” or for missing any of the ostensibly unanimous goals of the European Union. Thereby bringing down any once solid majority at a stroke of their lying pen, within a few months at most.
(III) Speculating in currencies, momentarily, is a means to personally alleviate the worst. But only until the disasters strikes in earnest. Gold is rising against the Euro, as well. Same with most raw materials, now drawn into the vortex of hyperinflation. Perhaps buying rubles would provide some longer perspective, as Russia has at least some volition to fight inflation and bubble economic conditions, and may be counted doughty enough to once again end free covertibility of its currency against the, soon-to-be, soft-currencies of the West.
(IV) It’s not “corporations” which run U.S. or globalized economy, unlike the common myth has it. Corporations are nothing but the packages into which the legacy of a formerly productive industrial economy is wrapped up and organized for the process of gutting and despoiling, while amassing power and riches and the hands of few. The powers are the hedge funds, the circles of financiers, private banks, “high net worth individuals” and other influence groups (as, e.g., the Council on Foreign Relations, Bilderbergers etc.) who control the corporations.
And one side note to the “grandparent” of this reply (Visceral): Findng out who of us is right is some practical thought work you COULD do. The people of this nation have not yet begun to see the ugliness of reality. But once they see, survival will depend upon them being still able to see anything else, in that moment.

[GLOBALISATIONisBARBARISM]

Well, even though I’m involved in controversial discussion over it with mrcontinental (see below) I still hold to my view that the answer to your question is change US policies, after all!

Buy gold, learn farming, it’s all good, but it won’t help even in case a majority of individuals would do it on their own accord. Why? Because the financial predators will buy a kilogramm for ever gramme of gold privately bought, and because of industrial breakdown a run to the country will not only not suffice to feed the existing population, but will most certainly bring back the darkest feudal age.

But HOW to change US policies? That remains to be found out by every single person reaching such stage of insight as you have, and by the aggregate of all such persons, collectively. Survival, in our times, necessitates that many, many “political artists” will be coming forth, from everywhere and within very short a time.

THE TRICK IS to spread a clear consciousness of the reasons to be panicked, without spreading the panic itself. You need to make a person like MS. PELOSI (or Harry Reid, or all who back their treasonous lack of action) grasp that she will be lynched in the foreseeable future. But how such lynching looks like in 21st century society, that remains for you to find the powers to envision and relay.

Perhaps, a close study of mrcontinental’s writings can help you along.

[Sundialsvc4]

Lone Ranger: "Tonto! We're surrounded!"
Tonto: "Whaddaya mean 'we', paleface?"

---

Let's stop looking quite so narcissistically at "our own" economy, at "our own" affairs as though the United States of America were the only country of conceivable importance anywhere on this planet.

"The World Wide Web" refers to much, much more than a global telecommunications network.

As Chief Seattle observed, "we are all connected ... we are not the fabric but only a strand in it."

The hundreds of other nations and societies elsewhere on this planet understand this perhaps more than we do. In our "so-called 'news'," these other men are usually presented to us as sub-humans living in sub-cultures and enviously staring at "US." But that isn't real, and maybe it's high time that we started to acknowledge that in public.

Today, and to the disgust of both the world community and the US's own citizens, the US presents itself as a rapacious "super power" which considers itself entitled to all the rights and privileges it chooses to associate with that label ... namely, to put the screws to everyone "else."

Such a bully might just find itself quietly excluded from the playground. And rightly so. We'll just stop using your currency to buy our energy, and stop buying your worthless trade-paper, and if you happen to be so naiive as to think that your big guns and big bombs will change things... think again.

Such a bully might think that World War Three is, "Simply Bully!!" ... and profitable too ... but maybe the rest of the people on this planet have OUTGROWN such childish things. And maybe, you're out-numbered after all.

[GLOBALISATIONisBARBARISM]

"illustrating the narcissistic horror an empire at wane can wreak"

The fiendish thing in all that TURGID LOAD OF NONSENSE, which I had difficulty to read to its end, is that by passages like the one quoted it obviously purports to deal with real world, in its tragic, cruel hopelessness.

What is this entire piece of rubbish? Is is supposed to be critical? Has it a real message ("The science is in. The rest is propaganda or diversion. We need to pull it together." – would tend to make it seem so.) Then why not speak it in plain language and even positively conceal it? ("the truth is that money is a lie", "We are on the cusp of [...] greatness") This is truly ROME BURNING. People finding pleasure in such distractions as Scott Thill offers us here have sold out their sense of morals and responsibility. More even than Bush, who just simply is insane.

Evidently everything, in these days, turns around how to accomplish this: FEELING WELL while the flames start to hit your own underbelly.

[mrcontinental]

Just going about your day to day activities is enough to show you that it's "everyone for themselves­." We have far to many special interest groups to ever arrive at a consensus on any subject and once the illusion of economic prosperity has been ripped away fingers will point and the attacks will commence.

It will be like the former Yugoslavia, families and friends, neighbors and co-workers will be at each others throats. Racial tensions always present slightly below the surface will erupt and ignite and engulf whole neighborhoods, and the have nots will be paying visits to the have's and taking that which they desire by force.

There is absolutely, positvely nothing that would indicate that americans will work through a cataclysmic economic depression on the scale that the up coming one will most certainly be. Greed and self interest have caused this current situation and this was during the best of time. Do you think people will rise above it when times are cruel and dark? I unfortunately do not. We are more concerned about our pets than our fellow citizens and I believe that says it all.

[GLOBALISATIONisBARBARISM]

I guess, I fear you’re right, you’re exactly right (... and would feel driven, by the way, to, therefore, conclude that probably the times and events are which the Biblical prophets, long ago, described for the end of the aeon, - if it were not exactly this "faith group" contributing the very most to the hatred and confusion you are talking of.)

But one question let me ask you. You write in your profile that "FOR THE LAST 70 YEARS" [America has settled its governments debt by issuance of paper]. Thereby you include the New Deal of Franklin Roosevelt. But hasn’t the governments debt of FDR been PRODUCTIVE, while ours today no longer is. And aren’t you thereby blurring a very important distinction. Ignorance of which is part of the prevention of the solution.

I mean, you might say, every attempt to wake up this crowd of pet-fuckers, err.. ... self-lovers, is so harshly futile, no positive appeal is worthwhile. But shouldn’t we in any case be fair by impeccable analysis? With this in mind: WOULD NOT a revivification of a kind of New Deal be the solution? And SHOULDN’T we make it a privilege of the really, positively obdurate to oppose the only working solution? Eliminating the danger that scores of those who simply do not understand it unnecessarily join the pathetic chorus!?

Or, once again on the factual side of the matter: DIDN’T the problems start to get really bad, essentially when politicians emulated to go as far away from New Deal policies as possible (labelling them as "emergency measures" now obsolete and counting on the bad taste which emergency will always invoke in better times, for who would like to think back to war and need in times of ease?), and when the people were cold, vain and OBLIVIOUS ENOUGH TO ACCEPT THIS FADDISH SCHEME? – This scheme of the 1960s' drunkenness with youth and cheap rebellion, which only started faddish, but soon set out on the path to grow compulsive, then oppressive, and now monstrous.

[GLOBALISATIONisBARBARISM]

I guess, I fear you’re right, you’re exactly right (... and would feel driven, by the way, to, therefore, conclude that probably the times and events are arrived which the Biblical prophets, long ago, described as due for the end of the aeon, - if it were not exactly this "faith group" contributing the very most to the hatred and confusion you are talking of.)

But one question let me ask you. You write in your profile that "FOR THE LAST 70 YEARS" [America has settled its governments debt by issuance of paper]. Thereby you include the New Deal of Franklin Roosevelt. But hasn’t the governments debt of FDR been PRODUCTIVE, while ours today no longer is. And aren’t you thereby blurring a very important distinction. Ignorance of which is part of the prevention of the solution.

I mean, you might say, every attempt to wake up this crowd of pet-cherishers is so harshly futile, no positive appeal is worthwhile. But shouldn’t we in any case be fair by impeccable analysis? With this in mind: WOULD NOT a revivification of a kind of New Deal be the solution? And SHOULDN’T we make it a privilege of the really, positively obdurate to oppose the only working solution? Eliminating the danger that scores of those who simply do not understand it unnecessarily join the pathetic chorus!?

Or, once again on the factual side of the matter: DIDN’T the problems start to get really bad, essentially when politicians emulated to go as far away from New Deal policies as possible (labelling them as "emergency measures" now obsolete and counting on the bad taste which emergency will always invoke in better times, for who would like to think back to war and need in times of ease?), and when the people were cold, vain and OBLIVIOUS ENOUGH TO ACCEPT THIS FADDISH SCHEME? – This scheme of the 1960s' drunkenness with youth and cheap rebellion, which only started faddish, but soon set out on the path to grow compulsive, then oppressive, and now monstrous.

[morphizm]

Tough crowd!

[dejavu2]

Mission accomplish­ed...I'm scared shitless. But seriously there are some very sobering times for our country coming up. It truly makes one feel so helpless. How do you make people who don't have a conscience suddenly have one? I'm guessing the only way is to stop putting money into their pockets. Let your consumer voice be heard!

[GLOBALISATIONisBARBARISM]

But "consumer" is exactly what you will no longer by, once the economic catastrophe start unfolding.

Finally, let your citizen's voice be heard.

(E.g. by stopping seeing in a non-event like the unproven man-made quality of global warming, with its allegedly but likewise unproven quality of becoming catastrophic, cloud your perception of what really bring about your humilitati­on.)

[mrcontinental]

"We are on the cusp of both disaster and greatness"

What greatness would that be? This nation is more fractured and divided than at any point in history. Uncontrolled greed has already taken us over the edge. 1% having 40% of the wealth... no when it blows there will be only disaster and only blood will satisfy many.

It's almost to terrible to contemplate but we must. We could have a situation every bit as bad as "The Balkans" right here on Main Street USA.

[mmckinl]

Spot on ...

America is just a shell. We've exported our productive base and imported debt. We've exchanged ethics for fear and morality for torture. It's every man for himself and a corporatocracy for a government.

Our current political structure is hamstrung by money and media malfeasance. This country will survive , but as what ? Will it be an enlightened, chastised new form of the New Deal or wil it be Mussolini's Italy?.

[GLOBALISATIONisBARBARISM]

Exactly, mmckinl. THIS is the question. -- Not the stuff about (allegedly man-made) global warming, which is used to throw dust in people's eyes and dispose them to accept a new round of bubble economies (cap-and-trade) and neat forms of market-based genocide (burning food in your tanks).

[Henry]

I think that as a country of small family farms and sole proprietors we had a chance...s­mall scale unit production keeping the masses occupied with animal husbandry and immense pride in the soil of the family farm.
However, we have moved into the world of capital multiplication, corporate ipo, leveraged buyout, and paper earnings far removed from effort or production. It's a historical story of haves and have nots. Indifference from no stake, antagonism from humiliation, eventual outrage from intolerance. Crossing mother nature may turn out to be our biggest mistake.

[2Truthy]

"No, our planet is going to become our worst enemy, if we keep treating it like shit."

Scott,
I have always enjoyed your informative essays, and the above sentence is a superb soundbite for the ages -- with just the right "language and liquidity" to inspire change.