One Year Ago!
Good Morning all of you hard working semi-sane individuals out there in reality land; your King of Simple News is on the air.
About a year ago, I wrote a piece that described the problems that Japan and other heavily dependent export countries were currently experiencing. Let’s revisit some of the points that I made as I believe the relevance of those points is what we many people are getting for Christmas.
We need to consider that the U.S. is not exempt from the same problems that affect other nations. In fact, we are in worse shape because we produce very little that foreign nations can afford. Therefore, our leadership kicked the can on down the road a few years by selling us on the idea that we could trash manufacturing and small based agriculture and borrow our way to Utopia. Do you really believe we can exist on ever mounting debt? If so…about that ocean front land that I have for sale over in Eastern Utah.
When we talk about the crowded export nations, it really does boil down to this: If you live in a 400 sq. ft. apartment together with three other people and there are folks living under the same conditions, up, down, and sideways from your place…a grand piano is not on your Christmas list.
Japan and Korea have risen to prosperity by makin’ stuff that some other country would buy with raw materials that they imported, but that they can’t buy for themselves due to space requirements. Similar, if you would, to a New York apartment dweller. When you lack a garage or a parking space, a Hummer is simply not in the cards for a birthday gift.
This is why we see so many Japanese and Korean tourists in Las Vegas, the money was starting to crowd the space that the toilet paper formerly occupied and the folks in Vegas were willing to provide a little entertainment in exchange for some yen and won.
I’m certainly not demeaning the Japanese. When you live on some islands that are smaller than California and you have 3.5 times more neighbors than Californian’s do; you do what you gotta do to make a buck. However, it appears that the buck has stopped.
If you want a real life example of how stimulus plans work, Japan is on their 7th stimulus plan and they continue to see declining living standards. Perhaps the Japanese plan is the one that our leadership is adhering to…stimulus = lower living standards for most Americans.
Japan designed an economy that was 100% dependent on massive exports; forever. A think tank team in Tokyo was locked in a room for a week without any saki and charged the daunting task of determining the root of Japan’s current problem. They have now divulged their findings and concluded that forever is a long time.
Japan now imports 40% of their food. They pay for that food with the money that is received from exports. Nuff said.
Korea is virtually in the same boat, as exports represent some 70% of their economy. Protests of the unemployed in both Japan and Korea are becoming common place. (Sound familiar)?
The glue that held all of this mess together was the trade imbalance between these overpopulated nations and the U.S. who would buy anything that was available on credit. Our current and implausible economic train wreck was literally designed by our own federal government.
Once the U.S. entered into both NAFTA and the World Trade Organization agreements, the monkey was dead and show was over for the American Middle Class. Our jobs and industry were put out to the lowest bidder without consideration of the eventual consequences.
So now what? In the case of Japan and Korea, I see little hope for either. Both of these nations have risen to a standard of living that exceeded the natural carrying capacity of their sovereign land mass. They cannot possibly consume their own production (domestic growth) due to physical space requirements and yet their elevated standard of living creates an ingrained cost basis that will forever limit exports. Yes, exactly like the United States.
As for the U.S., the American public will at some point all wake up on the same morning and realize that they have been mathematically sold out by our government and Wall Street.
The citizens of the U.S. and Canada will eventually unite in a revolt of sorts that will demand that jobs and troops be returned to the North America.
As an aside, the requirement for a passport between the U.S. and Canada should have never seen the light of day. We have enjoyed the distinction of having the longest unguarded border in the world with our northern neighbors, and if anything, the laws should have been relaxed, not strengthened, in these trying times.
Continuing at the same time that we see the public outcry, our standard of living (as measured by per-capita consumption) will necessarily decline in an effort to reach a semi-sustainable level.
Those of us who would like to get a jump start on this downhill trip should attempt to simplify our lives by our own volition. Slow down and live.
So there you have it, my thoughts from a year past.
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“Japan designed an economy that was 100% dependent on massive exports; forever.”
The US designed an economy that was 100% dependent on massive growth; forever.
There are significant differences between Japan and the US; however, the same imbeciles have been running the show in both places.
Watch Japan closely. The Japanese inhabit a small, rocky group of islands with little arable land and few natural resources. Their population is in overshoot now, but that is changing.
The US has a larger land mass with more arable land and some remaining resources. However, our population is also in overshoot, but unlike Japan, our population is still growing. Some people never learn.
Give the US a few years, we will catch-up with Japan. Our road will be different, but the destination is the same. Any bets on who wins the race to the bottom? There are plenty of other horses in this race too.
Mike,
Where will we all be in a year from now? I came across a disturbing if true news article from one of the European News Websites. I’m attaching a link at the bottom. Here’s the Headline:
President Obama Orders 1 MILLION US Troops to Prepare for CIVIL WAR.
“Russian Military Analysts are reporting to Prime Minister Putin that US President Barack Obama has issued orders to his Northern Command’s (USNORTHCOM) top leader, US Air Force General Gene Renuart, to “begin immediately” increasing his military forces to 1 million troops by January 30, 2010, in what these reports warn is an expected outbreak of civil war within the United States before the end of winter.”
The article touches on many points that Mike and fellow commenters have discussed here over the past few years.
http://www.eutimes.net/2009/11/obama-orders-1-million-us-troops-to-prepare-for-civil-war/
Greg,
One stark similarity between Japan and the U.S. is that we are both broke. The U.S. does have some resources remaining, but our current plan to grow out of this recession will remedy that nuisance.
The one bright spot is that we could easily grow all of our food needs…Japan can’t.
George,
What an ugly report huh? I’m not really buying that we will break down into Civil war within a year.
As you suggested, I have written that there are differences between regions in the U.S. that will never be bridged. The division between the ultra right and the ultra left will likewise never be bridged, but I don’t believe that either will lead to a true civil war in the near future.
Note that the article continually refers to “The West.” This is a suggestion that there are subtle divisions among nations and the tone eludes to jubilation over our collapse. After all, “The West,” celebrated the fall of the iron curtain endlessly.
Did the cold war really end or just take a break to regroup? I suggest the latter.
Mike,
Tremendous foresight on your part. I hate to say this, but overcrowding, lower living standards, possibly not enough food? Sounds like the recipe for another war. And “free trade” was supposed to make nations interdependent so that war was not possible. It looks as if “free trade” may be the catalyst for the next big one.
Yes, we can grow enough to feed 300 million people. However, if Americans can’t afford to pay for it, and other countries can, it could be sold to the highest foreign bidder.
We could starve in spite of adequate domestic food production. Let’s keep in mind how Capitalists and “free markets” work. Does anyone think that big agribusiness cares if we starve if there is more money to be made selling the food elsewhere?
Hotrod,
You were reading my mind. We embraced world trade with both arms as we ran out of domestic oil. We decided to import our way of life and therefore, world trade is good.
When the shortages come and our dollar is worthless, how well will free trade and globalization play? Why do we have 700 military bases around the world? To protect democracy? I’m thinkin’ not.
Just a little comment on “the same imbeciles have been running the show in both places.”
If anybody cares to note, those “imbeciles” are all doing pretty well.. Not the middle class, not the majority of people in the country.. But, those running the show have been doing pretty well.. Even when the chips seem to hit the fan, they seem to wind up on their feet with generous bailouts..
I note BHO is just getting around to looking into jobs recovery.. It didn’t take him that long to bail out the billionaires who caused the problems..
Not too sure who the “imbeciles” are, but, those running the show seem to be making out much better than I am..
From my point of view, they seem pretty smart, and maybe we are the imbeciles.??
wma…
Greg,
There must be something to this E.S.P. thing tonight. As I wrote the comments I was thinking about how those in the massive cities would pay for the food if they were unemployed.
Of course, you are correct in assuming that our food would go to the highest bidder or exchanged for the remaining oil. A hungry man would trade a pound of gold for a big double cheeseburger!
Wma,
Those imbeciles are crooks and contrary to advertised opinion, crime does pay quite well.
The imbecile moniker was aimed at the impossible direction that they have steered us, and it is in fact imbecilic.
It’s all measured in dollars Willy, the bad guys are winning.
I like this food growing topic. Bottom line is that it matters little who owns the land (it is who is in possession of it), the real problem lies in the era after peak net energy (post oil). Billions will die from starvation in the year following peak net energy. Ya, see the land is great, but if you do not have the fuel to farm it or the fertilizer (oil and natural gas) to correct it’s deficiencies, it matter little who owns it at the time.
A couple of factors will affect our ability to grow our own food after 2030 (latest). Civil war within our country 9This will happen in varying degrees) and nuclear war ( a real possibility) during the oil acquisition years, coming up real soon. Even if we quit using the growth pattern for our economic policies, tomorrow, we will soon not have enough oil to even fight a war. This will severely jepardize our ability to feed oursleves in the future. Of course, everyone on the planet knew this day was coming at the latest in 1974. Are we doing a better job of planning now that the deadline is approaching. Doesn’t look like it from here. -bb
“The citizens of the U.S. and Canada will eventually unite in a revolt of sorts that will demand that jobs and troops be returned to the North America.”
The troops will be returned to North America alright … to usher us into Haliburton detention camps.
This sorta reminds me of a “Foto-funny” in the National Lampoon back in the 70s. The first couple frames had a picture of Leonid Breshnev saying he’d like to extend a heartfelt word to the Czech people … Tanks. The last photo was one of the soviet T-72s rolling into Prague.
The issue of providing food is complex and politics complicates it even more.
There are many people in organic farming today who claim they can match the output of chemical farming, even surpass it. And they have the documentation to back-up that assertion. We need to make the transition to organic farming quickly and do it with short-term subsidies. After all we have been subsidizing big agribusiness and automakers with cheap oil for decades. If we ever priced oil based upon its true cost, taking into account its finite and irreplaceable nature, and the pollution it causes, neither of these approaches to business would have ever worked.
If preventing mass starvation was our goal, we could limit that unfortunate occurrence to those areas that are hopelessly over populated relative to local resources already, those areas include parts of China, India and Africa. However, in spite our pious jabber, that is not a priority.
As bad as our energy situation is; in the short-term, we could reallocate our remaining oil, giving preference to agriculture and agricultural transport. This would allow us time to make the transition to more organic and local food production. However, this would be strongly opposed by special interests and would be defeated or delayed.
Whatever carnage we experience in the coming decades won’t result so much from a lack of resources, but rather from mismanagement of what we do have. It will also come from our indifference to the suffering of people that we don’t know, people we can’t identify with. Whatever guilt is felt will be rationalized away and we will still see ourselves as caring people. That’s assuming we even give a damn, we may be too busy saving our own hides to care.
The troops will be returned to North America alright … to usher us into Haliburton detention camps.
I don’t see that as a viable option for the US government. We are talking about the same US military that got it’s butt kicked in Viet Nam by a hopelessly out gunned enemy. The same one that could only get a “draw” out of the Korean War and is currently losing wars in Afghanistan and Iraq. They are good at killing people and winning battles, but lousy at winning urban guerrilla wars. Worse yet, they have never had to fight a battle in a country as big as the US, and for the first time the battle will be on their home soil. When troops go home for leave, they will travel through a war zone and go home to a war zone. If they wear their uniform home, they will simply be a target, so will their families.
Even now the military can’t keep their own troops from killing each other - at home! What will happen when the military is breaking down because of conflicting opinions within the military about fighting against their own people.
If the powers that be are smart, they will just take a page from the Nazis. Find a scapegoat for the mess and deflect the rage away from themselves at home. Also, create some foreign enemy and launch another war overseas to distract people. At least until we run out of money and energy. This is a much safer strategy than risking all-out, urban guerrilla warfare with 300 million people armed to the teeth with guns and rifles.
Propaganda is almost always more effective than bullets, not to mention cheaper and safer.
Some pretty deep comments there this morning!
Billyb commented about the necessity of oil to produce and transport food. I agree whole heartedly.
Well before we are out of oil, the cost of producing food will skyrocket as will the cost to process and transport the same. As we continue to add new consumers to our already over burdened society, we purposely weaken our own system. Go figure.
The issue is not whether we can grow enough food in America to feed Americans, that’s a no brainer. Like taking corn from a blind chicken; it’s easy. The problem is that the basis for our entire lifestyle is collapsing.
Greg talked about the wars and they do remind me of the gorrila tactics that were employed in our own war of Independence. The British were ill prepared to fight those who didn’t follow the rules.
I suppose so long as we have young men and women who are willing to die because our leadership tells them to…that we will always have wars.
I personally would have difficulty dieing in the act of supporting the lifestyles of the likes of Barrack Obama, Nancy Pelosi, Harry Reid, George Bush, Dick “Dick” Cheny and 535 corrupt Congress men and women. But, that’s just me.
I am not smart enough to make a good prediction for exactly how this will unfold. I do expect that real war will play a part in it sometime, but when is wide open. It could be a decade away or it could be next week. Two things I am sure of; I won’t be around “forever” and our leaders have great egos more often than great ideas.