Good Morning to the Middle Class of the world; your King of Simple News is on the air.

In yesterday’s comments, alert reader, Dave Eriqat, noted that he was excited with the goings on in Detroit. What Dave was referring to was the “deconstruction” movement. Entire sections of old and abandoned neighborhoods, along with their accompanying infrastructure, are being torn down and returned to farming and nature. Youngstown, Ohio is practicing the same program on a lesser scale.

Both cities are reacting to reality; some 30 years after reality arrived. That’s what humans do you know? We are rarely proactive. We hold on to the old paradigms until on some dark and desperate night, our grips are pried from their historical coattails. Only then, out of total despair, do we embrace the harsh reality and hurry to create yet another false paradigm that is totally devoid of math and physics.

It seems to the human mind that our lifestyles were abandoned overnight, but nothing could be further from the truth. Detroit proper for instance, has been shrinking for fifty years.

The folks in Youngstown, Ohio have admitted that they spent many useless years trying to bring the steel mills back rather than focus on how they were going to proceed without the steel mills.

There is a very important lesson to be learned from Detroit, Youngstown, Cleveland, and a hundred other shrinking cities; exponential growth is impossible. Will New York, Boston, Chicago, Los Angeles, and Dallas also shrink? Sure, at least the living standards will diminish, as physics are not confined to locale.

For Detroit, it was the downfall of the American auto manufacturing that became the death knell, in Cleveland it was the collapse of manufacturing, in Youngstown it was the steel mills shutting down. What then will be the downfall of cities such as New York and Los Angeles?

What will be the downfall indeed; in two words, “false employment.”  We have created artificial employment for the simple motive of advancing the mathematically impossible concept of debt based growth capitalism.

Population growth is the fuel that powers growth capitalism and that population has to be employed; one way or another. Growth capitalism is a false paradigm and the consequences of that false paradigm will visit the other large cities of America just as it did Detroit.

To put this more simply, in order to grow population beyond the carrying capacity of the land, we must artificially grow the employment base within the confines of large cities.

Before his death in 1989, M. King Hubbert stated, “Most employment now is merely pushing paper around. The actual work needed to keep a stable society running is a very small fraction of available manpower.” And so it is.

Balanced employment vs. physical capital, peaked around 1970. Since that historic date we have advanced the folklore of debt based growth capitalism with false employment supported by growth of debt. And since debt is nothing more than a claim against future growth, we can create false employment until such time that the future can no longer provide for the past debt service.

A million is a thousand, thousand. A billion is a thousand, million. A trillion is a thousand, billion. In 1970, the National Debt that had accumulated over the first 194 years of this nation was $371 Billion, just over one-third of one Trillion. Today, a short 40 years later, congress has raised the debt ceiling to $14.3 Trillion. The current one year deficit alone, of $1.6 Trillion, is 431% greater than the total debt accumulation of the entire nation over our first 194 years of existence!

Do you think maybe something went wrong? Congress doesn’t.

The burning question is then, how much debt can the future bear? Millions upon millions of jobs are based on the answer to that question. When on some dark dreary night, we reach that limit, the awful reality that arrived in Detroit will come calling on the remainder of America’s largest cities, of that, there is no question.

But in the mean time, as a people and a nation, we will embrace the false paradigms of our underlying economic platform, that of debt based growth capitalism, until such time as harsh reality comes knockin’ on our collective doors. Unless that is, you adopt my motto of, live simple, live free, and live well.