Category Archives: deficits

A Warning of Economic Collapse

Eleison Comments by His Excellency Bishop Richard Williamson

Traditional Catholic Bishop Richard Williamson’s latest missive should be a wake- up call for those who naively believe that the worst is behind for the US and Western economies after the March financial sell off and the long-anticipated implosion of the bubble economy.  His Excellency asserts that the US and much of the world are on a financial precipice:

At this moment the United States has been brought to the brink of a tremendous

economic crisis, and with the USA, the rest of the world.*

Bishop Williamson contends that it has not only been the response to the virus, but more importantly, the response to the bursting of the financial bubble, created by the Fed, which will ultimately lead to a cataclysmic collapse:

By 2019 as the public was more and more hooked on fantasy money, the

Fed’s public balance sheet took off into complete unreality, seven trillion dollars

and counting, and it is now crashing the real economy with the corona-panic,

then ‘paying’ the crash debts that everybody gets into with its unreal trillions, but

turning the whole world into real slaves.

The bishop’s brief analysis of the history of the Fed is right on as he explains that the central bank has been the engine of monetary mischief since its inception:

These money men had promised that the Fed . . . would solve the problem

of reoccurring economic crises. . . .  It did nothing of the kind.  On the contrary,

it made them even worse, like the Great Depression of 1929 and the years following,

and now the Depression of the 2020s which risks making 1929 look like a picnic, and

risks stripping the United States of its prosperity and enslaving its liberty by making all

American citizens into debt-slaves. The middle class will soon be no more.

One quibble: Bishop Williamson rightly sees the problem of the money supply controlled by “private individuals” (central banksters):

It is not normal for private citizens to control their State’s money because they risk

doing so in their own interests, and not for the common good.

Yet, the alternative – State control – is no better and, under “democratic conditions,” maybe even worse considering the State’s horrific record in the debasement of money, the creation of booms and busts, hyperinflations, the destruction of savings, etc.

The only economically sound, morally defensible monetary system is one based on gold/silver where money and credit cannot be created “out of thin air” and where competing gold and silver producers vie with one another to produce the “best money.”  Such a system requires no central bank while fractional-reserve banking is prosecuted as fraud.  The creation of money is what is mined out of the earth not government and central bank fiat.

America’s current financial condition has ominous parallels to ancient Jerusalem before its destruction by the forces of Vespasian and Titus.  A couple of years before its final destruction, a Roman army, under Cestius Gallus, had stationed troops under the walls of Jerusalem posed to launch an assault.  Yet, Gallus did not attack and ultimately pulled back.  This was a clear fulfillment of Christ’s prophecy about the city’s destruction:

And when you shall hear of wars and seditions, be not terrified: these things must first

come to pass, but the end is not yet immediately.  [St. Luke Ch. XXI; vs. 9]

 

And when you shall see Jerusalem compassed about with an army: then know that

the desolations thereof is at hand. [Ibid., vs. 20]

Rome’s hesitation – a clear result of Divine intervention – gave Christians a chance to escape the coming conflagration which many wisely took advantage of:

Then let them that are in Judea, flee to the mountains: and let them that

are in the midst thereof depart out: and let not them that are in the

countries, enter into it. [Ibid., vs. 21]

Destruction of Jerusalem

50. The First Jewish-Roman War; the destruction of the ...

Since the March lows, Americans have been in a situation not unlike the denizens of ancient Jerusalem.  The relief programs and bailouts of businesses (mostly large corporations and banks) has staved off an even greater downturn, however, this has come at a tremendous cost as the Fed has had to print trillions, the consequence of which will mean either a collapse of the dollar or, at the very least, a dramatic loss in its purchasing power.      

At present, it does not appear that the US has much time before the final unraveling of the economy takes place.  The current debt levels and the new debt that will have to be created to maintain the status quo will lead to a monumental monetary crisis.    

Many have interpreted Jerusalem’s fall as a punishment for its sins.  Likewise, the coming collapse can also be seen as retribution for the US’s crazed monetary and fiscal policies which have bankrupted the nation while enriching the few at the expense of the many. 

While Jerusalem’s destruction had little reverberations on the wider Roman Empire at the time, the demise of the dollar will have global implications since it is the world’s reserve currency.  Like those who heeded the Divine prophecy two millennium ago the present generation should take Bishop Williamson’s words to heart and prepare for the coming financial storm.

*His Excellency Richard Williamson, “Economic Reality,” Eleison Comments, 12 September 2020.  https://stmarcelinitiative.com/eleison-comments/

Antonius Aquinas@AntoniusAquinas

https://antoniusaquinas.com

 

Debt, Death, and the US Empire

Deep State Operative John Bolton

In a talk which garnered little attention, one of the Deep State’s prime operatives, National Security Advisor John Bolton, cautioned of the enormous and escalating US debt.  Speaking before the Alexander Hamilton Society, Bolton warned that current US debt levels and public obligations posed an “economic threat” to the nation’s security:

It is a fact that when your national debt gets to the level ours is, that it constitutes an economic threat to the society.  And that kind of threat ultimately has a national security consequence for it.*

What was most surprising about Bolton’s talk was that there has been little reaction to it from the financial press, the markets themselves, or political commentators. While the equity markets have been in the midst of a sell off, it has not been due (as of yet) to US deficits, currently in excess of $1trillion annually.  Instead, the slide has been the result of fears over increase in interest rates and the continued trade tensions with China.

While Bolton’s warning about the debt is self-serving, it is accurate in the sense that the US Empire which, in part, he directs is ultimately dependent on the strength of the economy.  “National security” is not threatened by a debt crisis which would mean a compromised dollar, but such an event would limit what the US could do globally.  Real national security is defense of the homeland and border control – non intervention abroad. 

War mongers like Bolton are fearful that a debt crisis would necessitate a decline in US power overseas.  America is fast approaching what took place with the British Empire after its insane involvement in the two World Wars and its own creation of a domestic welfare state which exhausted the nation and led to the displacement of the British pound as the “world’s reserve currency.” 

The US-led wars in the Middle East have been estimated by a recent Brown University study to have cost in the neighborhood of $4 trillion.** Despite this squandering of national treasure and candidate Trump calling the Iraq War a “disaster,” as president, Trump increased “defense” spending for FY 2019 to $716 billion.***

US Military Bases Around the World

Profligate US spending and debt creation has, no doubt, been noticed by those outside of the Empire.  It is probably why Russian President Vladimir Putin has been so hesitant to take any serious action against the numerous provocations that the US has taken around the globe and against Russian interests directly.  The wily Putin probably figures that an implosion of US financial markets would eventually limit America’s ability to foment mayhem and havoc internationally. 

The Trump Administration’s latest bellicose act, engineered by – you guessed it – John Bolton, has been the withdrawal from the intermediate-range nuclear forces treaty (INF). The treaty, signed in 1987, was a landmark achievement of the Reagan Administration which de-escalated tensions between the two super powers and kept a lid on a costly arms buildup that neither can afford. 

The next financial downturn will certainly dwarf the 2008 crisis, the latter of which nearly brought down the entire financial system.  The next one will be far worse and will last considerably longer since nothing has been resolved from the first crisis.  The only thing that has occurred has been the creation of more debt, not only in the US, but by all Western nation states.

Under current ideological conditions, a change in US foreign policy to non-intervention is unlikely. Public opinion is decidedly pro-military after years of indoctrination and propaganda by the press, government, academia, and the media.  It will take a fall in America’s economic power, specifically the loss of the dollar as the world’s reserve currency, which will ultimately bring down the empire that has neocons like John Bolton concerned.

Unfortunately, until that time, the US will continue its rampaging ways.  The day of reckoning, however, appears to be fast approaching and instead of a defeat on the field of battle, the US Empire will collapse under a mountain of debt.  It would be more than fitting that such a scenario should play itself out which would thus begin the very necessary retribution process that may, at least in a small sense, compensate those who have suffered and died from America’s murderous foreign policy.

*Tyler Durden, “John Bolton Warns National Debt Is An ‘Economic Threat’ To The US Security.”  Zero Hedge.  01 November 2018.    

**Jason Ditz, “Study: US Wars Cost $4 Trillion, Killed 259,000.”  Antiwar.  29 June 2019.

Military Benefits, “2019 Defense Budget Signed byTrump.”  Military Benefits. September, 2018. 

Antonius Aquinas@AntoniusAquinas

https://antoniusaquinas.com

The Gold Standard: Protector of Individual Liberty and Economic Prosperity

goldstandard vs.    the-bill-of-rights

 

 

The idea of a constitution and/or written legislation to secure individual rights so beloved by conservatives and among many libertarians has proven to be a myth. The US Constitution and all those that have been written and ratified in its wake throughout the world have done little to protect individual liberties or keep a check on State largesse.  Instead, in the American case, the Constitution created a powerful central government which eliminated much of the sovereignty and independence that the individual states possessed under the Articles of Confederation.

While the US Constitution contains a “Bill of Rights,” the interpreter of those rights and protections thereof is the very entity which has enumerated them.  It is only natural that decisions on whether, or if such rights have been violated will be in favor of the state.  Moreover, nearly every amendment which has come in the wake of the Bill of Rights, has augmented federal power at the expense of the individual states and that of property owners.

History has shown the steady erosion of individual rights and the creation of “new rights” and entitlements (education, health care, employment, etc.) which have occurred under constitutional rule.  Instead of limitation on government power, constitutions have given cover for the vast expansion of taxation, regulation, debt, and money creation.

While taxation has always been a facet of constitutional governments, it has been the advent of central banking and with it the elimination of the gold standard which has provided the means for the state to become such an omnipresent force in everyday life.  Irredeemable fiat paper money issued by central banks has also led to the entrenchment of political parties which has allowed these elites to create and subsidize dependency groups which, in turn, repeatedly vote to keep the political class in office.

Without the ability to create money and credit, the many bureaucracies, regulations, and laws could neither be created or enforced.  This would mean that the vast and powerful security and surveillance agencies could not exist or would be far less intrusive than they currently are.  With commodity money, debt creation would have to be repaid in gold, not monetized as it is currently done through the issuance of paper currency.

Just as important, it would have been next to impossible for the two world wars to have been fought and carried to their unimaginable destructive ends.  None of the populations involved would have put up with the level of taxation necessary to wage such costly undertakings.  Few of the wars which followed (most of which have been instigated by the US) could have taken place without central banking.  Nor could the level of “defense” spending – currently at a whopping $717 billion for fiscal year 2018 – be financed if the US was on a commodity standard.*

Under a gold standard, governments would have to rely on taxation alone.  Since citizens directly feel the effects of taxation, there is a “natural level” that it can be raised.  Punitive tax rates usually lead to a backlash and potential social insurrection which strike fear in the hearts of political elites.

Recent projections by the Congressional Budget Office again demonstrate that constitutional government provides little restraint on spending.

If present trends continue, the federal government will spend more on its interest serving its debt than it spends on the military, Medicare, or children’s programs.  It is also expected that next year’s interest on the debt will be some $390 billion, up an astonishing 50 percent from 2017.** And, for the entire fiscal year of 2018, the gross national debt surged by $1.271 trillion, to a mind-boggling $21.52 trillion.***

At one time, economists used to speak of the pernicious effects that “crowding out” had on an economy.  Since the onset of the “bubble era,” talk about deficits has almost dropped out of financial discussions.  Yet, the reality remains the same: public spending and borrowing divert scarce resources away from private capital markets to unproductive wasteful government projects and endeavors.

For those who seek a reduction in State power, defense of individual rights, and economic prosperity, the re-establishment of a monetary order based on the precious metals is the most efficacious path to take.  Such a social system would not require elaborate legislation or fancy proclamations of man’s inalienable rights, but simply a return to honest money – gold!

*Amanda Macias, “Trump Gives $717 Billion Defense Bill a Green Light. Here’s What the Pentagon is Poised to Get.”  CNBC.com 14 August 2018. https://www.cnbc.com/2018/08/13/trump-signs-717-billion-defense-bill.html

**Nelson D. Schwartz, “As Debt Rises, the Government Will Soon Spend More on Interest Than on the Military.”  The New York Times. 25 September 2018 https://www.nytimes.com/2018/09/25/business/economy/us-government-debt-interest.html

***Tyler Durden, “US Gross National Debt Soars $1.27 Trillion in Fiscal 2018, Hits $21.5 Trillion.” Zero Hedge.  2 October 2018.   https://www.zerohedge.com/news/2018-10-02/us-gross-national-debt-soars-127-trillion-fiscal-2018-hits-215-trillion

Antonius Aquinas@AntoniusAquinas

https://antoniusaquinas.com