24 December 2012

Why the fiscal cliff is inevitable

Democrats want the fiscal cliff.  Democrats will blame the Republicans for "blocking legislation" to stop the fiscal cliff.  Dems want higher taxes, and they know that no amount of "soak the rich" is enough to keep their favorite pork spending around.

So why are the Dems even trying to look like they are searching for a solution to the fiscal cliff, even after not being able to produce a budget since they took a majority?  Why?  Because Dems have a better psyops/propaganda cell to get their message out.  They believe based on their experience that they can shift blame to the Republicans.

At this point it our government isn't about actual functioning, it is about the appearance of functioning.  Congress has been reduced to the equivalent of two children pointing fingers at each other and saying, "It's your fault! Nuh uh!" in an attempt to get the public to buy either sides story of how the other kid started the fight and they were just standing up for themselves.

Republicans, if you can't fight dirty, go the fuck home.  If you can't keep proposing real solutions that force the Dems to back down (and show your math, coming off as a technocrat isn't a bad thing in our society), then just roll over and piss on yourself like Boehner already has.

Politics isn't about getting things done, it is all about perception.  All the world is a stage, and politics is center stage.  Any politician who claims to have done something useful with their life in politics by creating legislation is a deluded fool at best, a narcissistic sociopath at worst.  A politician who claims to have done something useful simply by blocking other politicians attempts to rape my freedoms might actually have a claim to the title of "useful."

So, the fiscal cliff is going to come, but Republicans need to start the narrative NOW that it is the Democrats who fought for it, who refused to compromise, who raised taxes on the middle class.  All good little soundbites for the next election season in the house.

The Dems have been playing by Alinsky's rules for a generation or two now.   The battle for the hearts and minds has been won so far by the Dems, but the great thing about an insurgency is that the hearts and minds get swayed the other way.


Another Anon said...

The reason for all the political theater is simply, there are no solutions.

Not one.

What would actually be required is a minimalist state, a small mostly domestic military, a much smaller Social Security and Medicare system and severe austerity across the board.

Both parties, Left and Right have too many vested interests to do that.

Nearly all of them are on one pad or another and even those that aren't are unwilling to make the cuts or take the risks. There are hugely meaningful differences in belief systems and ways of governance

Also even if we could get it done there are serious issues especially in a two years to election or four years to election time frame. IMO Its an at least ten years till done thing.

A real increase in hunger can present a huge national security risk, 50 million on food support, who knows how many on other programs and a lot of anger is a good way to have a French style revolt, especially if the security forces are cut back. And there are innumerable other issues

Even those with the nerve and integrity might shy at the long term consequences in terms of economic issues, global security, domestic peace and such.

So these old fogies and their trainees battened on the wealth of peak America (1968) and stuck in its old narratives, keep on kicking the can. Its beyond them to do otherwise and we are no more capable of meaningful change than the USSR was.

Anonymous said...

I have to agree with the above post, and add that both left and right are reactionaries.

And AM good luck with that fantasy about identity politics for liberty, I really mean it. No proof whatsoever that any of these groups will take you up on it, but at the very least it is your club of "moral superiority" you can wield over the troglodytes of Realville.

AM said...


If the Dems do it, why can't the Republicans do it? So far no one has been able to come up with a good answer for that. Gays? Log Cabin Republicans, Blacks? Got them too, Women, Yup. All the pieces are there except a perception of inclusiveness.

If we are going to be Sweden, then damn it lets be Sweden, high taxes and cradle to grave socialism.

What we can't do is keep spending more money per citizen than France and have tax rates smaller than any other socialist country. Hell, we can even be Germany with business friendly Socialism.

What I don't want is for us to become (formerly) Great Britain, which seems to be the most likely route for us.

Joe said...


At this point, it looks like following Great Britain would be a blessing. I have a bad feeling things are going to end up like Argentina.

Badger said...

X-ring, whole article, thanks.

The Republicans have made their approach to "lesser" government in an individual's life to mean, "except for us where, if you don't think, value & act like us, we don't want you." Until they ditch genuflecting at the High Church of individual moral superiority they have screwed themselves into irrelevance and are deservedly branded hypocrites as they go down in flames.

They need to put someone forth who can endure a good 360-degree assessment, who will also vow to come back with a changed approach 'cause you big Republican babies, your current fuckin' CONOP is hosed from slide 1. Oh sorry; did I offend your sensibilities?

Clinton gutted our HUMINT capability because no one wanted to take seriously what the "unwashed" had to say. How'd that work out?

Another Anon said...

AM, I am hoping we'll go like the former Soviet Union or the Czechoslovakia minus the plutocracy and kelptocracy. Nice and peaceful.

I don't suspect it will be that easy, either the military will go to direct rule (the reason BTW the Founding Fathers didn't want a standing military) or the Left will find some means to use the State or the people to engage in genocidal anti White Conservative violence.

Anonymous said...


Stop getting pulled into the fiscal cliff side show. The fiscal cliff is for public consumption, and it's not really that important in the larger game.

The point is, the US has a serious structural problem. There's going to be a run on the banks (of some sort) at some point. The monetary system and the banking system is trapped, and we're heading toward the Keynesian endpoint. They can talk and bitch all they want about fiscal issues, but the monetary system has to keep printing money, and to keep interest rates at ZERO forever, or it blows up. Once you go there, there is no leaving.

So stop listening to the fiscal crap BS, because that's all it is. They're buying time, and using this fiscal cliff as a sideshow. The real issues are whispered in dark rooms - what happens when the currency fails?

Our problem is structural. You mentioned Sweden. Now Nordic Europe is interesting. You can get away with a lot when you're scaled down to a small size. Sweden is perhaps a bad example, because they're more capitalist than we are at this point, so let's talk about Holland. Holland has a population pretty happy with their socialist programs. They seem to work reasonably well for the moment. They work because they're small, and the population is largely homogenous. That wouldn't work in the US, but it might work on a city or county level. It's not my cup of tea, but it could work at a small scale.

Switzerland is another good example, it's a bottom-up structure rather than the federalist United States since Lincoln. When you structure things bottom-up, they're more stable. The idea is Hayekian, and natural. Adam Smith talked about this, and most recently Nassim Taleb has talked about it at length. The latter spoke in Zurich on this very topic, and there's a video on youtube, just search zurich minds taleb, and you'll get it.

The US and American empire is going to blow apart, nobody in washington has the balls to actually fix anything, it would piss off too many real constituents that they really care about - Defense contractors, and banks. Chalmers Johnson would be good reading for you as well.

AM said...


I've covered the coming financial collapse before.





Anonymous said...


Yes, you've covered the financial collapse before, and you're on the right track. However, I think you're perhaps not seeing the bigger picture of such a collapse, and discounting the vastness of the impact (not necessarily acuteness).

The United States maintains an empire that is the center of gravity and control for most countries in the world. Politically through the IMF, BIS, and international foreign policy, every country in the world, every jurisdiction is under US control except for perhaps a dozen. All one needs to do to start understanding this is look at which countries are non-extradition to the US, and don't have an American military presence, it's a precious few.

The US flexes this power to control other countries domestic policy to varying degrees. India for example a week or two ago, has put exchange controls on gold to slow and prevent the inflow to that country - not in their best interest, but certainly in US best interest.

Net, the US has transitioned the British empire into a global power unrivaled since Rome. However it's all built on leverage and interconnectedness. The network effect scenarios are terrifying. Watch the Taleb video again https://www.youtube.com/watch?v=zOUph1JpLlk, and take special note to the discussion on Societe General. Size is lethal, size makes you fragile. The US footprint and scale is huge, and the interconnectedness of the western system is light-speed.

The US empire is in total control of Japan, they are a complete and total puppet state, and have been since the war. Since they're likely next in line to explode in a currency crisis (see Kyle Bass http://www.zerohedge.com/news/2012-12-26/annotated-kyle-bass-short-japan-thesis), it will be interesting. The contagion effects from any vassal state failing has such huge and unknown network effect possibilities.

The politicians and central bankers in DC from all stripes are mostly filled with hubris. They know that they have to keep scaling up the system to keep it going, but they don't see the disaster stalking the world from their stupidity. They've wired the entire world in such a stupid way, that everything will blow up as a result.

Imagine living in a satellite state of Rome when it collapsed, but with hyper-specialization of labor, over-optimized systems and just-in-time inventory systems. That is more or less the whole world right now. Those fools in DC are a lost cause.

The best thing we can do is to start quietly setting up alliances so that when the inevitable happens, we can quickly limit the damage - tell us what is coming and try to sabotage any crimes against humanity, then set up new Gaul states based on the original intent of freedom, liberty and the constitution.

AM said...


1929 happened.

History doesn't repeat itself, but it rhymes.

The Byzantine Empire lasted a millennium longer than the Roman Empire.

The Soviet Union collapsed, and somehow still manages to be a player on the international stage.

See what I'm getting at? No one knows what the US collapse will look like. We know it will be "big" but we don't know the details.

When you honestly look at US trade, not in terms of "dollars" but in terms of imports and exports, we export food and high tech manufacturing equipment. Sure there are other things we do, such as microchip/processor fabrication, but for the most part if the US ceased to exist as an importer/exporter, the world would be able to adjust without much of a fuss.

Heck, Germany alone could easily take over the high tech demands from our former customers, and while the food exports would take longer, it wouldn't be too long.

Personally I think that that we will fall somewhere along the Weimar Republic after WWI. A worthless fiat currency that eventually leads to a stable economy which leads to a popular despot who uses keynesian economics to fix internal infrastructure.

The biggest reason why the "Stimulus" wasn't really a stimulus is that our "aging" infrastructure is still largely operating at full capacity. For the Dems to actually see any return on investment from Keynesian principles they would have to utterly break that infrastructure first. Kinda explains why they use the EPA to stop new infrastructure from being built, doesn't it?

Galt-in-Da-Box said...

No war in history has ever been won by doctors, free condoms and clean water.
Similarly, getting in bed with the enemy never wins a war, either: you, Mitt Romney & John Boehner have all yet to realize this.
While they sit on their hands and drone on superscilliously about a "fiscal cliff", neither half of the Authoritarian Establishment is going to win after we go over it, because their worst fears will be realized: Government reduced to constitutional bounds and living within its means...
God & Sonny Jesus, wouldn't THAT be a new day!?

Anonymous said...


I mostly agree with you. I think a cross between Wiemar and the Balkans will be the net result. However, I don't think a US dictator will be able to fly. The US is barely functioning now, and it's slipping through their fingers each time they grab for more power.

I see more of a Balkanization end-state perhaps with a Wiemar beginning / middle. I tend to lean towards Taleb's assessment. There is a global pull towards the end of the nation state, and a push toward city states (maybe with a dictator or two at that level). I think that will play out over time. The US has gotten too big to govern top-down. Each day that passes adds diminishing returns. It's the cascade failure problem. It's a form of entropy. The system will correct itself to a new stable, less centralized state. Additional concentration of power in DC just won't work for very long, but they'll probably try it anyway.

Though I agree, we don't know what that will look like in action. I think by looking at history we can see the broad trends that will shape the future.

Where are the minds of current active officer corps? What are they willing to do, and not? If DC pushes to far will it be a Honeker stand down like we saw in East Germany? Any interaction with CIA, pentagon or FBI people would be interesting as well, to the same questions.

AM said...

People keep making cases for Balkanization without much historical thought put into it.

Balkanization happens when people are more concerned about their tribe or ethnicity as an identifying factor. I don't see that in the United States.

It happened when the USSR collapsed as you had Georgians, Ukrainians, Lithuanians, etc.

When Rome collapsed, it had already split, and splitting is a bit different than "fragmenting."

How would the US split or fragment? It can't be along ethnic lines (unless you believe in the myth of Aztlan as pitched by La Raza), and as "tense" as race relations are in the US, this is nothing. There isn't the generations deep hatred like there is in Europe or Asia.

One could make a very good argument that America will just experience an Argentina style economic collapse, possibly with a Chilean style Pinochet dictator as a result.

I understand Bracken's cube, I understand that there will be areas and neighborhoods where you don't want to look different from anyone else, but on the flip side I don't see a Black shadow government forming, nor a Hispanic shadow government forming. Or for that matter, even a Pro Freedom shadow government forming.

AM said...


We couldn't have won WWII without the Communists. Sometime getting into bed with the enemy is just what you need to do, no matter how distasteful.

Anonymous said...


I see Balkanization as a possible and perhaps very likely result because of incentives, not racial or tribal lines. I think the racial issue is mostly BS. The key lies in looking at it in the reverse. It's not that the country strongly wants to split apart on racial, ethnic, or ideological grounds. The problem is you cannot have a system or country that is so top-down to the point of structural instability actually stay together. What cannot stay together will fall apart.

Texas is a good example. They have their own incentives and state "tribe", a lot like Catalonia. The same can be said for Wyoming. The Southeastern US also has it's own culture which is far removed from that of NYC and DC. California has it's own identity, actually 2. As people and states become more desperate, more animosity will build towards the central planners in DC, just as in Catalonia, Spain.

When the printed money stops incentivizing states to suck from the federal teat, it's over - when the states are net payers of money to DC in real value. Once a currency event occurs, and trust in the dollar is gone, DC will be seen for what it truly is, a parasite. Right now, the federal government is taking borrowed money and giving it to the states (bribes) for programs and roads, et al. That won't go on forever. When the value proposition ends, there would be no reason to have affiliation to DC and the system will reset to a natural equilibrium. The US dollar is the lynchpin holding the country together, period.

Austria and Germany, especially compared to Bavaria aren't all that different, but they're separate countries, despite the attempt at "unifying" under Hitler. The world trend is starting to emerge with Catalonia, Scotland and the building resistance to the EU. Those cities and communities that produce value don't want to give it blindly to a central government to be wasted. France was a network of city states even up to the point of Napoleon. Paris was a stand-alone city. Brittany still isn't very french, or Normandy. I wouldn't be surprised to see France split apart again either.

It's not a lack of charity, or compassion for other human beings that these states are seeking separation. It's a natural human organizational rule. It is human psychology. Look up the "rule of 150". Human communities have a maximum threshold before they start breaking down. It's fractal to a city and state level as well. Just as there is a natural limit to how tall you can build a cylinder of sand, human networks have saturation points as well.

Another option for the US is that it could return power to it's state and individual sovereignty past and stay together. That would stabilize the system more or less, but the power structure would fight that tooth and nail to keep their power. Compounding that, when these cascade failures occur, they usually over-correct. Though a return scenario to the original constitutional republic is the most desirable, I think it's unlikely for those reasons.

Anonymous said...


France was a network of city states to the point of Charles de Gaulle, not that long ago...

AM said...

Obviously people from New York have absolutely nothing in common with people from New Mexico, except for television, radio, music, art, fast food chains, language, etc.

The difference between Serbs and Croats was that one didn't go to Church and the other didn't go to Mosque.

Balkanization comes from distinct tribal/cultural/religious differences. What you are pointing out is geographic and economic, more akin to the "split" of the Roman empire.

Whether it is a civil war and Balkanization or a peaceful split is anyone's guess. It could even be that the union is retained, similar to Argentina or other nations that have gone through economic hardship.