Big Government

The US Wars with China and the War with Itself

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The US is currently at war with China over trade, economic policy, technology, capital and
geopolitics (Dalio, The Changing World Order, 2021, Chapter 13). While the US has no formal
treaty obligation with Taiwan and President Nixon and Secretary of State Henry Kissinger
recognized China’s claim five decades ago, President Biden repeatedly said the US would
intervene militarily to defend the island. Only a global hegemon could make such a threat.
China is destined to once again be a great dynasty, as it has been at least twenty times over the
last 22 centuries. The US was the sole global hegemon by 1945 as all the major empires of the
world were at this stage in decline, setting the stage for a century (the historical norm) of global
dominance. But within two decades, with the ascendance of FDR protégé Lyndon Johnson, a
War in Vietnam and a “Great Society” at home, the US was in decline.

In spite of the creation of OMB in 1970, the flight from the dollar that forced President Nixon to
default on gold convertibility in 1971 and the creation of the CBO in 1974 to stem the debt
crisis, starting in 1975 30 states petitioned for a federal balanced budget amendment. Since
then, US debt has grown 100-fold, current spending is twice revenue, the Federal Reserve is
financing half that deficit and the dollar has fallen 98% relative to gold. Such debt super-cycles
end in national bankruptcy-ending empire the way Hemmingway described: “slowly at first,
then all at once.”

National denial has global consequences. Britain entered into the Great War as a declining
power to thwart Germany, then a rising power. World War II was really an extension of the
Great War, when a German veteran, a lance corporal, came to power on the false narrative that
the Bolsheviks and Jews caused their loss. Britain lost the empire but remained in denial until a
speculator dethroned the pound Sterling in 1992. Similarly, the Soviet Union was in denial (as
was the US CIA) right up to the point of total collapse from within in 1989.

The US is now arguably in the position of Great Britain prior to the Great War as a military
power, but faces internal dissent that is arguably worse than that of the former Soviet Union. It
can follow the British path to weaken the rising power while restoring US hegemony, remain in
denial and continue on its current path toward civil war or revolution, or seek a softer landing
based on a restoration of US founding principles. Faced with these choices politicians generally
find war more politically palatable than the short-term pain of restructuring, even when that
results in complete destruction, asserting “nobody could have seen this coming.”

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The Great Unraveling

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For the last few weeks we have been watching one of the greatest collections of weaponized autistics in the world going happily about their task of unraveling exactly how much of our money was directed through previously undetected means for previously undetected and wholly curious ends. The Doge crew are going at it with the zeal and joy of unleashed rat terriers turned loose on a field of suitable prey, in tracking millions of dollars’ worth of our money into various progressive slush funds.

And interesting things are suddenly happening. Although coincidence is not causality, by any means … still, there are things that people on the conservativish side of things have wondered about for the last decade. Things like … strangely well-choreographed protests, with tens and hundreds of participants (who mostly have no obvious means of support) appearing almost like magic, carrying professionally-printed signs. Hmmm … we all wondered in times past: who is footing the bill for all this?

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In At the Beginning

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Reading here and there about what can only be viewed as corruption of various charitable agencies by an apparent flood of government dollars, I am certain now that I was inadvertently present at the very start of that corruption – a warping of charitable concern towards refugees, as well as non-refugee migrants, the homeless, the addicted and the otherwise socially maladjusted. I was a college student in my junior year at a no-name public university, at the time of the fall of the South Vietnamese in 1975. My adolescent years had been haunted by the ongoing war in Vietnam, a war painted in the most horrific colors by the then-extent national media. I grew up in a place, a time and in a class of Americans where men were much more likely to be drafted and sentenced to serve for a year in what was painted by the national establishment media as a pointless, endless, thankless war.

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Quote of the Day

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Dominic Cummings:

The EU has kneecapped itself and is failing in all important areas: productivity, debt, public order, immigration, defence, technology, political extremism. Brussels chose self-sabotage on advanced technology. Unlike Britain which at least has DeepMind here, the EU has none of the leading labs. As the Commission said, we will be leaders not in AI but ‘trust in AI’! Mission semi-accomplished comrades! Brussels can kneecap itself and other countries that choose to follow its regulations but it will not compete with US and PRC or shape the global struggle over AI. Valley companies have already made clear they will simply not release models in the EU rather than follow EU regs. Taliban today can download new models now blocked for Brussels elites. Those who think AI will be like aspects of post-war car regulation are wrong. AI is ultimately about power and Great Powers will not let Brussels set the rules. I’ve watched SW1 repeat soundbites from the EU for 25 years on ‘strategic autonomy’ and ‘now we’re going to get serious on technology’. They’ve always been hollow. I said in 2022-4 that covid predicted that not even wanting to prevail in Ukraine would force either the MoD or Brussels to stop the delusions. They babbled and watched. They left defence industry and procurement a farce. They encouraged deindustrialisation and sabotaged industrial production while babbling about net zero. Thanks to Brexit and the work we did in 2020 with the secret part of the Integrated review exposing the disaster zone of the MoD and agreeing a plan for radical change, we could have sorted ourselves out. Instead, 2021-4 the Tories worked with the worst parts of the MoD to continue the lies and delusions and followed the EU into escalating a dumb war which could have been avoided. The latest defence review is a disaster and the UK and EU will be humiliated month after month.

 

Thoughts:

1. There but for the grace of God go we.

2. UK and EU politics and culture are farther gone than ours. However, as in the 1970s with Thatcher and perhaps now with Trump, political and cultural course reversals are possible given gifted opposition leaders and a preference cascade or two.

3. The British establishment, by criminalizing dissent, insure that even more than our Democrats  they will not see the political wave coming that turns them out of power.

4. It’s never over.

DOGE is an Oxymoron: Unchecked “Democracy” is the Problem

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Unlike the private sector, where operational efficiency is necessary to survive, the public sector is and always has been inherently inefficient. But that’s not the main problem. Think of federal public polices justified as being in the “public interest” as a building. On the upper floors are the best of them, the merely inefficient. At the mezzanine level are those suffering from extensive waste, fraud and abuse. On the ground floor are policies and programs rife with self-dealing and crony capitalism. Down in the basement is the “temple of virtue” where taxpayers are sacrificed to multiple ideological isms.

DOGE is peeking inside the locked doors on all four levels. As DOGE exposes “Dirty Deeds, Done Dirt Cheap,” politicians cry foul, as “they were implemented (by us) democratically. To paraphrase Churchill, “democracy is less bad than totalitarianism,” but, he might have added “generally worse than competitive private markets.” At this stage in US democracy, DOGE revelations have lost some of their shock value as commonplace, and politicians emphasize their good intent. DOGE needs to demonstrate that “good intentions” often lead to bad outcomes, and do not justify corruption in any case.

DOGE alone can only win a few skirmishes against Congress and its massive army of rent-seekers feeding off their largess. With public understanding and support, the Trump Administration could bring about more permanent structural changes that provide greater voter control.

Life is a Competition

Americans love sports, from 5 & 6-year-old soccer leagues through high school, college and pro teams, where the competition to succeed is intense. Pro sports is a business, as the recent Luka Donic trade to the Lakers reminds us, with winners and losers. It is incredibly “democratic” as millions of fans choose what players to follow, games to attend or stream at the posted price, and owners respond continuously to fan expectations. The competition is subject to a massive set of complicated rules and limitations enforced by referees and judges whose integrity is subjected to coaches’ challenge, instant replay and fan fury. That reflects the system of checks and balances that a competitive private market incorporates.

Now imagine a pro sports league designed and governed by the most honest and altruistic national politicians. They would deem it unfair to pay some athletes more than others, or to exclude the weak or physically impaired from the competition. Winners would be determined by political deal making in smoke-filled back rooms. Prices would be determined according to “ability to pay” and ticket purchases would be mandatory whether or not attending the games, with revenues first flowing through party coffers. Fans would be told who to root for and losing teams and cities would be declared winners so as not to result in hurt feelings. Voting against this system would result in your team being designated the loser but you would still be required to buy the tickets. That’s a metaphor for our current “altruistic” federal democracy.

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