American Purgatory

December 15, 2009

By G$ Simmons

Are financial markets a direct reflection of the overall health of a nation? I wish they were not, but I fear they are.

I wonder at times if our nation has entered a state of purgatory – all of us mulling around in the waiting room to Hell, anxiously counting the minutes until the grim reaper saunters through the door sickle in hand his mission to send us off to eternal damnation. Unfortunately, there is little time to close this door so that we may stave off this potential fate that looms so near. What we need to alter this course is a procession of men and women who possess moral fortitude and common sense, people of rationality and reason. People of action who will set in motion the dismantling of institutions that bleed this nation dry.

Hope is not a strategy. This present state of manufactured optimism emanating from the White House and our news outlets is contemptible. We are in dire need of new reformist leadership and of new voices that will speak the truth. A national purification is long overdue. Time is not on our side. Look at the track record this nation has racked up over the last few decades and this economic and moral purgatory in which we find ourselves might very well mark the beginning of our walk of death down the long road to Hell.

I make this analogy of a national state of purgatory not in jest, but rather in practical terms. This nation has gone the way of an absolute meltdown of morality and ethics. We’ve reverted to a sort of Wild West where anything goes. From the halls of congress to our corporate boardrooms our collective morality bar has sunk so low we cannot go any lower without disconnecting from the great past this nation is starved to regain. We stand dangerously close to the point where immorality begets our undoing.

This article is my effort to call people’s attention to the truth. The brevity of our circumstance is immeasurable by past reference. Economically, we have never been so challenged. Profits are now had at any cost – damn the long-term consequences. Instead of being exposed as the obvious fraud he was, Bernie Maddoff was coddled by the SEC – an institution whose role as regulator is a complete failure. As Wall Street and Washington betrayed an entire nation, employees of the SEC were too busy surfing porn on the Internet instead of doing the jobs taxpayers pay them to do.  At the same, young girls are selling their virginity to the highest bidder in public cyber-forums where grown men (not hormonally charged teenage boys) seek out their sexual fantasies in the netherworld of Internet pornography. What of the wives, children, and even parents of these men? Do they approve of such questionable actions? Is there any accountability left?

flavor-flavThink of our children turning on the television to see people anamial genitalia, drinking blood or urine, and eating live bugs for money on game shows like Fear Factor, or take Flavor Flav and his hit (how does this happen?) reality show where he maintains a crew of women all of whom physically fight each other to have sex with him because he’s a celebrity? really ?  And finally, there’s always Survivor, the ultimate demonstration of all things wrong with modern human interaction. A reality show that pits person against person in a deceitful game of moral destruction where lack of ethics are rewarded, instead of punished. Survivor, this is what our nation’s leadership has become. Win at any cost!!! again really? I wouldn’t believe it if I heard THIS was the future of entertainment even a decade ago…

Morality is in great part the measure of a nation. Have we unlearned morality? Is this why we find ourselves staring down the abyss?

sheepleWe are allowing ourselves to become more corrupt by the minute. We fail to understand that absolute power, corrupts absolutely. In what will go down as the greatest financial heist in history our leaders have chosen to reward corrupt individuals and their hollow corporations for what are arguably criminal levels of risk behavior by the moneyed elite of this country. What message does that send to our children, or to anyone for that matter? Be as corrupt as possible in the US and you will be rewarded? Be the biggest failure jeopardizing the fate of others then stand in the corporate welfare line with all the other wealthiest institutions of the world, your greedy hand extended for a government bailout check while you simultaneously foreclose on an entire nation? Talk about the rich corralling the masses. It’s no wonder someone coined the term “The Sheeple.”

The path we traveled to this purgatorial limbo is both easily understood and misunderstood. The answers to understanding are sometimes right in front of us. What are seemingly benign things or actions, those everyday judgments or decisions we make to do one thing or another, are not always benign. Tell a little white lie to make that one sale that will put us into our bonus. Rig the game in our favor so that we might enjoy a little more opulence for the few decades we have remaining on this planet. Look the other way while the Federal Reserve and Wall Street blow economic bubble after economic bubble and in the process create a six-hundred trillion dollar shadow banking system that plays by no one’s rules but its own. In the case of Goldman Sachs, and Wall Street in general, lie, cheat, and steal their way to profitability at the expense of three hundred million taxpayers. The fact is that we have become an uncooperative nation willing to take advantage of anyone for the sake of profit. The idea of building a cooperative future where everyone wins has been sacrificed at the altar of short-mindedness.

peter principleIt might be this purgatorial limbo I speak of is simpler than it appears. It could be that we are collectively suffering the consequences of the “Peter Principle”, or getting to the job of failure. This principle supposes that an individual rises in a corporate hierarchy to their first level of incompetence. An assembly worker gets promoted to supervisor then to assistant manager, then manager, until he next gets promoted to an upper management job for which he is ill equipped and subsequently gets promoted no further as he can no longer demonstrate the competence required for the task at hand. He rather relies on subordinates who are then stuck with an upper manager who cannot carry out his own duties. Could this be the state of our nation? Have we been promoted as far as our competence allows? Are we in fact incompetent to handle our future? Have we now elected a man just incompetent enough for the Presidency who is being manipulated by Goldman Sachs, the Federal Reserve, and a circle of (previous) Wall Street insiders now on the government payroll as cabinet members and high-ranking advisors? The saddest thing is that we sit idly by whilst our virtue is being stolen. We do nothing.

A view of the world through rose-colored glasses does no one, any good. We are not as resilient as we think we are. Instead, we exist in a world of synthetic productivity where multi-tasking renders us incapable of doing anything effectively or with any level of competence. Multi-tasking, that art of simultaneous ineffectiveness is a counter productive weapon that to a large degree has contributed to the potential failure of this nation. If you were to listen to Alan Greenspan however, you would believe that multi-tasking through technological gains by way of the “new paradigm” was the gold at the end of the Information Superhighway and that exotic mortgages and the burgeoning spending class paved the road to riches. We now know these premises to be empirically wrong.

It can now be argued that what would seemingly be advancements in productivity are proving to be setbacks. The Information Superhighway has led us to dilute our ability to carry out simple tasks as we click work,  to Facebook or on-line solitaire, or porn. We are now a nation of excuse makers. We look for someone else to keep us one step ahead of our accumulating debt that smothers the potential of what could have been an equitable future. Ironically, it is our technological arrogance that impedes our ability to produce and manufacture our way to prosperity.

made in the usaCraftsmen who used to flock to this country to fulfill the needs of a manufacturing base flock here no more. “Made in the USA” used to mean something. It meant quality. It was the definition of industrial capitalism. But now through the wonders of globalization we have exported our craftsmanship through an outflow of jobs to China and India as we turned everyone in the USA into real estate agents, mortgage brokers, and web designers – a perfect playground for bankers to ply their craft, lending money in every creative manner both thinkable, and unthinkable. “Made in the USA” has been reduced to the status of punch-line – synonymous only with “Mortgage Backed Securities” and other “Toxic Derivatives.”

Is it any wonder we have evolved into the ‘entitled society’? If we weren’t on the government payroll, or subsidized by the US taxpayer through social welfare then we were borrowing our way to prosperity. Enter the God-fearing middle class. Just dumb enough to buy into the scam a couple hundred million people began signing over their paychecks, selling their future for the enjoyment of having things now. We were transformed into non-productive Sheeple, selling our souls for an easier life in lieu of a better future for our children. At our current rate of productive attrition we will soon be a nation of declawed house-cats, possessing no skill-set whatsoever to survive in a world where the ability to produce real goods still reins supreme. Yet we remain the ‘entitled society’, when we are entitled to nothing.

michael douglas greedWe forget (through economic amnesia) that throughout history all societies fail. Nicolaus Copernicus maintained that civilizations failed when bad money, controlled and understood by an elite few, drove out good money. The same can be said for morality. Bad, drives out good. This is a reality of which we should all be acutely aware but rather are immune to its possibility. We dangerously believe we cannot fail. That, in fact, is the greatest gamble of all. A roll of the dice against history, a bet against all natural laws of the universe, all things are in a state of entropy. All things eventually wither away to nothing. To possess longevity is to be ahead of the universe. Sadly, we have constructed a fragile world that produces material things that do not last. The fiat money we use as the currency of our production is by design, destructive itself. The Federal Reserve prints greed, nothing more. But still we covet it. We pursue it as if it had value. And in this pursuit we destroy earth’s resources as if the laws of nature have no relevance. We believe there is only now.

Bankruptcy-3We, the entitled society, morally and fiscally bankrupt have borrowed, spent, and bailed our way into a historical corner. Nero should be so proud. Our public trusts are nothing more than government sanctioned check-kiting operations shifting liabilities from one credit card to another faster than our creditors can say “Federal Reserve.” The Ponzi-scheme that is our fiat currency system is about to go the way of what was for a time the symbol of American superiority, General Motors. It used to be said that what was good for General Motors was good for our nation. As I claimed in 2005 that GM would go bankrupt I will now guarantee that the US government is soon to follow. How our ultimate entropy will take form I cannot say, but form it will. We will default. We will restructure. It will be at this point our arrogance will end.

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December 17, 2009 at 1:51 am
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January 27, 2010 at 11:48 pm
economic amnesia « Thought Shop
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{ 22 comments… read them below or add one }

FRANKFURT AM MAIN, PRINCE December 16, 2009 at 3:06 am

You say that HOPE is not an option, maybe you are right.
For me the only thing that matters: WILL I BE PAID MY SHORTS ON THE DOW?
My answer is, YES, I WILL BE PAID.
The exchanges will never fail, the markets will. There will be always a price for an asset and I promise you that in any scenario DJIA will always be worth more than 0 but less that 2600 points, it will all end somewhere between this 2 prices.
Till it happens thousands of banks and brokers will go under, millions of traders will not be paid their profits, the most will lose everything.
The markets went up because of short covering and TARP money, which Goldman Sucks and JP Shmorgans used to buy stocks, not to lend to individuals and small businesses. No banker will lend a dime when he knows he will not be paid.
So words being words, but your insightful article doesn’t answer one simple question: Where to hide from what’s to come?
Literature and trading don’t go together, maybe you can write something about how traders can save their ass and have their money with a safe broker and bank.

maninwarren December 16, 2009 at 6:58 am
Master Lee Mochow December 16, 2009 at 10:00 am

A master piece I must study this and make it a song, Bless you my friend for taking the time to awake them.
Master Lee Mochow

Master Lee Mochow December 16, 2009 at 10:01 am
EW December 16, 2009 at 10:04 pm

Take Note:

Titus Livy the Roman Historian (59 B.C. to c. A.D. 17) warned about our present state of affairs while watching the Roman Empire Crumble around him. His words (see below) are telling and very pertinent to our current state of affairs. I’m afraid we are repeating the same problems every other “great society” in demise has felt. Have a good one!

“Here are the questions to which I should like every reader to give his close attention: what life and morals were like; through what men and what policies, in peace and in war, empire was established and enlarged. Then let him note how, with the gradual relaxation of discipline, morals first subsided, as it were, then sank lower and lower, and finally began the downward plunge which has brought us to our present time, when we can endure neither our vices nor their cure.” -Livy Ab Urbe Condita (59 B.C. to c. A.D. 17)

John Merryman December 17, 2009 at 4:33 am

The question is to what point of equilibrium does the system collapse and what model can be used to build from that foundation. Here is my idea on how to reformulate our current monetary system and the political mindset in which it functions:

“We think of money as an asset in its own right, but it’s not. Money is a medium of exchange. We do possess the money we hold, in the same way we possess the section of road we are driving on. You own your car, house, business, etc, but not the roads connecting them. Money is a similar medium. It is a drawing right on community productivity for which we exchange our surplus resources. Believing money is property encourages people to hoard it and that is corrosive to monetary systems. If it is withdrawn from circulation, more most be issued until the value is perceived to decline, then the hoarded money is dumped and the system collapses. Otherwise saving money means loaning it to someone else. The problem is that capital is subject to the laws of supply and demand, with the lender as supply and the borrower as demand. Since supply is potentially infinite, it is the amount of prudent borrowing which determines how much wealth can be saved. Unfortunately political power is on the side of those with money, rather than those borrowing it and this results in factors which swell the supply of money, while depleting the resources of borrowers. To create and store more notational wealth, the financial industry resorts to lowering loan standards and manufacturing excess circulation through securities and derivatives. Basically those who siphon all the notational value out of the system can only invest it by loaning back to those who do not have enough in the first place. Now with government guarantees, but that will eventually destroy the regulatory function that validates money in the first place.

Consider how it would change public perception of monetary wealth, if we were to come to the realization that the monetary system really is a form of public commons. The practice of hoarding excessive amounts would lack logical and legal justification, so savings would be taxed progressively. This is not to discourage individual effort, but a necessary recognition of the effect of excess savings on a functioning monetary system. If people understood monetary value constituted public property, than they would be far more reluctant to drain value out of their social networks and environment to put in a bank in the first place. We all like having roads, but there is little inclination to pave more than we need. In this situation, the same would apply to monetizing our lives. Other avenues of trust and reciprocation would have the space to develop, which would strengthen communities and their relationship to the environment.

When the Rothschilds developed private banking three hundred years ago, they were taking over the management of money from monarchs who were profligate. In doing so, they were responsible for maintaining the value of their currency. With central banking, the stability of the currency has become a government responsibility, while private banks maintain the profits of loaning it out. This is the foundation of the socialization of risk and the privatization of reward.

Political power started as private initiative and eventually grew into monarchy. Monarchists railed against mob rule, but we eventually learned how to make politics a public trust by allocating power where it was most responsive. Why not do the same with the banking system? As the currency is a public utility, so profits from its administration could be public income. A public banking system would not be one huge behemoth, but consist of institutions incorporated at every level of governance, so individuals could bank with the ones which funded the services they are most likely to use. Different communities would seek to provide the best services with these funds, otherwise they would lose business and citizens to other communities. These local banks would then be shareholders in regional or state banks to fund larger projects, which would be shareholders in a national bank that would issue the currency.

The problem in developing an successful monetary system is that while bankers are inclined to over-extend credit to increase profits, politicians are inclined to inflate the money supply to pay for public works. So banking would have to be a separate branch of government, similar to the judiciary.

A related problem is the system of public financing, where enormous bills, stuffed with enough goodies to gain sufficient support, are rammed through the system. That’s not budgeting. The process of budgeting is to prioritize needs and desires, then decide where to draw the line between what can be afforded and what cannot. Some years ago there was a discussion about the “line item veto,” where the president could delete any item he wished from spending bills. Obviously this would remove all power of the purse from the legislature and likely be unconstitutional. In the spirit of actual budgeting, a possible solution would be to break these bills down to their constituent lines and then have every legislator assign a percentage value to each line and then re-assemble them in order of preference. The president would then draw the line at what would be funded. This would divide responsibility, allowing the legislature to prioritize, while giving the president final authority over total spending. Since making the cut would be graded on a curve, there would be much less incentive to trade favors and the percentage system would allow legislators to fine tune their granting of favors to other legislators and lobbyists. Since local spending by the national government would be reduced, a local public banking system which recycled wealth back into local infrastructure would fill the hole.”

So the idea is to take our current social atomization and rebuild a bottom up economic structure of local interdependence, yet within a national political organization. Rather than the present economic vacuum designed to siphon all possible wealth into the pockets of those controlling the system of economic exchange.

The absolute, the universal state, is the essence from which we rise, not an ideal from which we fell.

RB December 17, 2009 at 7:54 am

Send snail-mail address and I’ll send to Brett Buchanan and co-author
inside information about what’s really afoot with this dismantlement
of the West.

mike thomas December 17, 2009 at 9:48 am

G$, outstanding article,I couldn’t agree more.As a matter of fact I just ran for and was elected to office,not because I wanted to but because there was no decent person running and I couldn’t in good conscience let people in local office who don’t know or respect the constitution and the wishes of the framers.People are starting to wake up,but who can they vote for?Very few candidates.
When I look around I see the communist manifesto’s principals being practiced more than constitutions.That is horrible and as you said,time is running out.
Keep up the good work
-mike-

Bob December 17, 2009 at 11:32 am

Great, great piece. Thank you for the courage to say it. One thing though. Purgatory is not the final stop on the way to hell. It’s a place of purification, a place to purge the ill effects of sinfulness. It is the final stop on the way to heaven.

Just saying.

Terry Hansen December 17, 2009 at 11:32 am

This is a concise summary of America’s central problem: endemic moral decay.

Greg Simmons December 17, 2009 at 5:17 pm

Bob,

Thanks for the comment. We definitely did some checking before using the word purgatory in the article (and the title). You’re correct on the usage of the word purgatory from a literal theologic standpoint – but from a popular standpoint I’ll refer you to Wikipedia:

The word “purgatory” has come to refer also to a wide range of historical and modern conceptions of postmortem suffering short of everlasting damnation,[1] and is used, in a non-specific sense, to mean any place or condition of suffering or torment, especially one that is temporary.[8]

We also used dictionary.com as a reference.

Mike Singleton December 17, 2009 at 6:47 pm

I call BS.

This whole mess has nothing to do with me or you. Place blame where it truly belongs with the government and the elite banksters. Their lack of ethics and morality does not equal a lack thereof within us.

Do not blame the slave if his master is evil.

You imply a social contract, I signed nothing did you? Such a contract does not exist.

Hagrid December 18, 2009 at 3:40 pm

We The People are the ultimate arbiters of the Constitution — we formed the states, we wrote the Constitution, we created the federal government. We have also stood by, figuratively and literally for over a hundred years, while the Trustees we elected to manage our Trust for the benefit of our communities, slowly and surreptitiously violated their Trust, enriching themselves and increasing their power at our expense, RIGHT UNDER OUR NOSES! We let them do this to us and we have only ourselves to blame — AND — we have only ourselves to rely upon to take back our Trust from the rogue Trustees. Throw them ALL out at the next election — every one of them! Run for office yourself, or encourage any Constitution-respecting citizens to run as Mike Thomas (above) has done. Disrupt the Trustees’ status-quo — put the fear of God into them and even if we don’t remove them all the first go-around, they will see the writing on the wall and behave far better in their last days. Just don’t put me in the same category as Pelosi, Boxer, Feinstein, Reid, Dodd, Clinton, Frank, Schumer and all the other bloated, loathsome rotting corpses running our government… into the ground!

Joe December 19, 2009 at 1:49 am

Here is the psychologist’s explanation for the world we are in:

http://laura-knight-jadczyk.blogspot.com/2008/02/trick-of-psychopaths-trade-make-us.html

Absolutely everything in your commentary is explained there. You may not like. But its crystal clear. And its not just the US that is infected. Its the whole world. This is a big problem requiring a big fix, and the fix is not a pleasnt one to contemplate.

Joe December 19, 2009 at 10:45 am

Here is a condensed (easier to read) commentary on the same subject:

http://www.opednews.com/articles/Is-George-Bush-A-Psychopat-by-Dr–Kevin-Barrett–080602-915.html

Note: It is not about George Bush, but it does include history and politics.

Brian Freeman December 19, 2009 at 1:07 pm

You said it well and good comments.
What came to me this morning is seeing one reason how the economic bubble came to be. Of course it’s not “the” reason.
As you stated, the American workforce went from a mostly skilled manufacturing hourly wage to a commission based parole. The more you sell, the more you make. Much of today’s service sector is based on a commission from the sale. No sale, no pay. Real Estate, insurance and financing is at the top of the list along with auto, furniture, aluminum siding and vacuum cleaner sales people. It’s all about the commission, the bucks, and being a top seller. The only tools needed are nice clothes, smiles, handshakes, and truth stretching lips hyping a product. The perfect Realtor movie is “Glengary, Glen Ross”. Staring Al Pacino, Jack Lemmon, Alec Baldwin, Alan Arkin, Ed Harris, and Kevin Spacy. The story revolves around a sales contest where the winner gets a Cadillac, second place gets a set of stake knives and the rest get fired.

james December 19, 2009 at 7:48 pm

Thanks to the xenophobia around Obama! It has helped so many to go back into our nation’s real history and see things anew. Even the last 8 years was not what we thought it was.

Mike December 22, 2009 at 5:33 am

Good article, but I believe you missed, or I missed when it when I read the article, the real connection between where we are and why. Corruption begets corruption, you identify fiat money as bad but I do not find a clear connection between that and the destruction of our society.

It appears to me that you identified immorality, corruption, greed, etc. as the cause of our decline. IMHO, those are mere symptoms of the root cause of our downfall, fiat money. Fiat money allows a privileged few to get everything they want and need to destroy a society, especially power.

You also imply that Federal Reserve Notes have no value…I disagree. As long as there are folks who will accept them for what I want and need, especially silver :-) , they have value.

de-pat December 27, 2009 at 12:52 pm

Will we destroy the earth before we destroy our own beds, I think not. But the earth does not care just as Mars must not have cared 20 million years ago if it was populated, as I think it might have been. We are just the current vermin on the face of this planet who think we are in some way important to the universe as a whole. Termites must feel a bit like that just before the exterminator gets to work but in the end they are not at all a factor and as such are just destroyed and forgotten in a very short time. At least there is an entity to remember them—-us. Who or what will remember us?

dan December 28, 2009 at 1:06 am

go fuck yourselves fucking ignorant wimp jerks!

Greg Simmons December 28, 2009 at 6:25 pm

Dan,

So you liked the article then? Do you work for Fear Factor? Or maybe Flavor Flav’s entourage?

james M. Convey January 3, 2010 at 12:05 am

The overwhelming sadness is that this piece will be able to convince no more than that very few, who still own the capacity to think for themselves. The gradual dissembling and the eventual demise of this present western human dynamic, initially seeded at the outset of the age of Anglo saxon civilization, is coming to an end. It remains to be seen what will replace it, and whether it will be fondly remembered as a Golden age? The future will be reformed, of this there is no doubt, with a new set of rules in every instance. It is hoped that the violence of change will be minimal, but there will be violence. One hopes we can avoid an apocalypse, but the question remains, if the new order will retain the best of the old, or it’s worst. If it is it’s worst, then just like a virus, it will eventually reappear to destroy anew. Such is the folly and arrogance of empires. To think that America could have been the greatest force for a good and moral eden on earth, the whole earth, if only the vision of it’s good men had not been corrupted over time by power, greed and ego.

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