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August 19, 2021 | A History of the Classic Elite Scam

Is an American author of books and articles on economic and financial subjects. He is the founder and president of Agora Publishing, and author of the daily financial column, Diary of a Rogue Economist.

The greatest happiness is to scatter your enemy and drive him before you. To see his cities reduced to ashes. To see those who love him shrouded and in tears. And to gather to your bosom his wives and daughters.

– Genghis Khan, first Great Khan of the Mongol Empire

POITOU, FRANCE – It’s easy to criticize the Biden Team for its breathtaking incompetence in Afghanistan.

So that’s what we’ll do.

But the debacle illustrates far more than just the failure of one president, one party, or one administration.

It shows us how the whole elite scam works…

…from the delusion that the rest of the world wants to be like the USA… if it could only get the chance…

…to the fantasy that its experts know what they’re doing…

…to the “exceptional nation” vanity… and misplaced faith in high-tech, super-expensive U.S. firepower…

…to the kind of misadventure you get up to when you can pay for it with fake money…

…to the collaboration of Wall Street and America’s leading industries…

…to the complete lack of historical perspective or intelligent political leadership…

…to the bovine-like acceptance by the public of the elites’ conjob…

…and the toadiness of its leading media.

Classic Elite Scam

As we pointed out in an early book, Empire of Debt, the U.S. never really got the hang of imperial finance.

Early empires must have been exhilarating… and rewarding. The conquerors raped the women, made slaves of the men, and carried off all the treasure they could get their hands on.

The Roman Empire was more sophisticated. Victorious troops won slaves and booty, and then the captured people paid regular tribute to Rome.

The British Empire was a more modern, commercial variant, taking raw materials from colonies and using them to make finished products in Britain, which were then sold at a profit.

But the U.S. empire was a money-loser from the beginning. The elite enjoyed the thrill of playing World of Warcraft with live ammunition. They also got the jobs… the contracts… and the power.

But they never figured out how to make it pay, except for themselves… and only by taking the money from their own people.

It was a classic elite scam, in which the rewards go to the people at the top… and the costs (including most of the fatalities) fall upon the public.

Eyes on the Money

Yes, in the Afghanistan debacle, it’s all there… right before our eyes, like a corpse dumped on the highway.

And now we ask: What other incompetence are the elites hiding? What other lies are they telling?

And… will the lies and bungling continue for years… and then come crashing down in a matter of days?

Our beat here at the Diary is economics and finance. So we will ignore the war against COVID-19, the War on Drugs, diversity, democracy, anti-racism, climate control, and the rest of the claptrap. We’ll keep our eyes on the money.

And we note, again, that it’s amazing what you can’t see when you’re paid to be blind.

Investors have made fortunes by not noticing that their stocks are priced nowhere near what they are really worth…

Statisticians are paid to miscalculate the inflation rate…

Economists build careers by ignoring the basics of economics…

Politicians win office by promising to spend more than we can afford…

And Federal Reserve chief Jerome Powell becomes the most famous public servant since Pontius Pilate by closing his eyes to the destruction caused by his phony interest rates and trillions of dollars’ worth of fake money.

Delayed Reaction

The fake dollar was introduced 50 years ago last Sunday. It probably would have disappeared long ago had not then-Fed chair Paul Volcker given it a new lease of life in 1980.

Thereafter, the U.S. held together fairly well for the next 20 years.

So we can probably date the real drift into fantasyland to about the same time as the invasion of Afghanistan… in the early 2000s.

“Reagan proved that deficits don’t matter,” said then-Vice President Dick Cheney in 2003.

Of course, deficits do matter. But not necessarily right away.

And by the time you realize that they do matter, you are trying to take off from a crowded runway… with dozens of people clinging to your wheels.

More to come…




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August 19th, 2021

Posted In: Bill Bonner's Diary

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