This is a re-post from eight years ago. I still feel the same.
I see you standing here, asking for help, about once a week. You are always polite, and I respect that. I’d like to do something for you… something that would matter long-term. Giving you a few notes or coins now and then may be fine, but I’d really like to improve your situation more permanently.
In other words, I’d like to give you a job. Continue reading “A Frank Letter to the Homeless Man Under the Bridge”
* Before anything else, I need to clarify my meaning: There are “activists” whom I respect and support. (Ernie and Donna Hancock leap to mind, as do several Bitcoin “activists.”) I divide these people from the activism of my title, because these people act, encourage, and teach directly, not through third parties.
This distinction will become clear to you as we proceed.
Once upon a time, there were courageous computer types who defied mighty Western governments and worked around them to deliver usable cryptography to the world. It took skill, it took intelligence, and most of all, it took courage. But these people took the risks and did it, and I think they deserve credit for it.
Sadly, however, more than a few of those people descended from the ranks of the righteously disobedient to the level of mere activists. They spend their efforts these days encouraging legislation, engaging in dialog, and promoting causes.
In other words, they went from doing things themselves to begging overlords to do them. Consider the two models:
The first model required skill, intelligence, and courage. It required people to act against the will of the dominator.
The new model makes activists advisors to the dominator. In their imaginations, they are so smart that they can trick the dominator into doing “the right thing.”
Please note that model #1 removes power from the overlord and transfers it to individuals.
Then please note that model #2 enhances the power of the overlord. It is only the overlord who is held as a proper actor.
Sadly, model #2 has become the primary model of activism in the Western world, and this is the model that I oppose.
#1: It enhances the existing order. As I’ve written before, mankind is now living with space-age technology and bronze-age rulership, a ridiculous and retrograde mode of organization. We desperately need to get past it, but rulership never willingly lets go of power. Supporting rulership – enthroning it as the only legitimate actor – is devolutionary; it drags us away from the future.
#2: It evades courage and risk. No one likes risk, but in a world controlled by bronze-age dominators, progress requires it. Under the modern activism model, however, almost no courage is required; the activist is a partner to power. Successful activism, under this model, ends with the ruler – and only the ruler – acting.
So long as we beg the ruler to act, we are harmless to power and even helpful to it. For example, while Alexander Haig was a major figure in the Reagan White House, he was confronted by anti-war protestors. His response was telling:
Let them march all they want, as long as they continue to pay their taxes.
Activism that relies on the existing order is no threat to the existing order. It benefits the status quo and it neuters potential activists of the first model, seducing them to avoid risk.
#3: It corrupts the activists. Activists of the second model tend to have problems with arrogance. That’s my observation, of course, and yours may differ, but the entire model rests on the ability of the activist to outsmart other people.
The model #2 activist outsmarts ruling factions to get his or her way. He or she works social media to get groups of people to repeat his or her slogans; he convinces masses to show up at his events; he gets TV cameras where they need to be when they need to be, then crafts sound bites that will play well on the news. In other words, he outsmarts everyone else.
The modern activist uses people as tools, especially the social media throngs. Thus, he or she gains a very real type of power. And as we should all know by now, power corrupts.
The successful activist, as a tool of his or her trade, must become famous, and fame corrupts at least as fast as more traditional types of power.
#4: It keeps the masses firmly within the status quo. People seeing the great, well-publicized successes of the model #2 activists never see any reason to move on their own. The brilliant activist gets things done by outsmarting power. That being so, their most sensible action is simply to support a successful activist.
Why should the concerned young person launch out on their own, seeing that famous gurus are already talking to the prime ministers, filing class-action lawsuits, and have thousands of online admirers? So, he or she finds a role inside the status quo that the activist is “changing.” Something feels naggingly wrong about it, but who is he or she to challenge the great guru?
And so the status quo continues forward apace.
#5: It creates and enhances a victim-based culture. Nothing gets better results in the modern age than portraying oneself as a victim or portraying one’s cause as in the service of victims. And so, that is precisely what the clever activist must do.
Worse, the activist needs his/her crowds to appear as victims and subtly encourages them to see themselves that way. Soon enough, the thousands do see themselves as victims, empowering the activist to champion their cause.
And please note that once we slide our minds into the role of “victim,” we give up agency over our lives. From then on, we become dependents, rather than confident actors on our own behalf.
In other words, we hand over our power to the activist and become dependent upon him or her.
Worse, we become morally dependent upon the activist, because the very role of “victim” requires a moral judgment. The guru activist then becomes a major force in our moral universe.
This amounts to a loss of personal power that is both subtle and pernicious, atrophying our ability to handle even our interpersonal interactions.
#6: It helps victims by using other people’s money. Convincing the state to “do something” is the easy way out. Rather than standing up and getting busy (and, god forbid, spending our own money), we empower the state to act. The truth, of course, is that the state does nothing without first stealing money, but we can easily imagine that it doesn’t cost us.
This model permits us to feel righteous at no expense. It’s false and wasteful, of course, but the illusion is easy to maintain… at least in the modern climate, where few things are called by their true names.
So, please engage in Model #1 activism: Use your own mind, your own cleverness, your own effort. Bless the world.
And once you do, give yourself credit. You will have earned it. You will have gained a real reason to feel righteous. Enjoy it.
Paul Rosenberg
www.freemansperspective.com
This is the question that astute investors are forced to ask themselves these days. No reasonable person believes that a system of ever-expanding debt can resolve painlessly. It simply cannot happen… not, at least, until 2+2 stops equaling four.
But the international money system, while deeply interconnected, can implode in sections. In fact, it’s highly unlikely that it will crash as a single unit.
So, if you have significant moneys to invest, you end up coming back to our question: Who will be the last to crash? Once you decide that, you can concentrate your assets in that place, hoping to come through the crash with at least most of your value intact.
Let’s look at several aspects of this:
World debt is upwards of $200 trillion, and growing steadily. World GDP is $70-some trillion, only about a third of the debt. This debt will not be paid back. Massive amounts of debt will have to be written off in losses.
US debt is north of $18 trillion. (Amazingly, *cough*, it hasn’t changed in months *cough*.) Forward promises are north of $200 trillion, meaning that a child born today is responsible to repay $625,000. And since roughly half the US population pays no income tax… and presuming that this newborn will be a member of the productive half… he or she is born $1.25 million in debt. Such repayments will never happen. Most of those debts will not be repaid.
Japan is worse off than the US. The UK is bad. Many EU countries are worse.
These numbers, by the way, are ignoring more than a quadrillion dollars of derivatives and lots of other monkey business. (Rehypothecation, *cough*, *cough*.)
Informed men and women understand that the entire system is unstable. Probably a majority of them are simply hoping that it holds together until they die. A few dream that magical new inventions will kick-start the system into a new orgy of debt, blowing an even larger super-bubble that lasts through their hopefully longer lifetimes.
But informed people also know that the system stands almost wholly upon confidence. If the sheep get scared enough to run away, the whole thing ends… and no one is ready for it to end.
So, heavy investors speak in soothing tones. They don’t want to spook the masses.
Last year, the International Monetary Fund (IMF) published a horrifying paper, called The Fund’s Lending Framework and Sovereign Debt. That paper, in turn, was based upon one from December of 2013, called Financial and Sovereign Debt Crises: Some Lessons Learned and Those Forgotten.
The December 2013 document, right at the start, says that “financial repression” is necessary. Here’s what it says (emphasis mine):
The claim is that advanced countries do not need to resort to the standard toolkit of emerging markets, including debt restructurings and conversions, higher inflation, capital controls and other forms of financial repression… [T]his claim is at odds with the historical track record of most advanced economies, where debt restructuring or conversions, financial repression, and a tolerance for higher inflation, or a combination of these were an integral part of the resolution of significant past debt overhangs.
So, in order to fix debt overhangs – currently at horrifying levels – financial repression is not just an option, but required.
And of course, they’ve already had a trial run, when they stole funds directly from individual bank accounts in Cyprus.
The IMF report goes on to say:
[G]overnments can stuff debt into local pension funds and insurance companies, forcing them through regulation to accept far lower rates of return than they might otherwise demand.
[D]omestic defaults, restructurings, or conversions are particularly difficult to document and can sometimes be disguised as “voluntary.”
We have a pretty good idea of what’s coming down the pike.
But again, Goldman’s Muppets are not to be told about this. And truthfully, most of them don’t want to know.
People make large bets on what Janet Yellen and the Fed will decide next, but when we do that, we overlook something very important:
Yellen is merely an employee of the Federal Reserve, not an owner. And we don’t know who the owners are.
We do know that the Fed is owned by private banks, and that it has a monopoly on the creation of US currency, but we really don’t know who owns the shares. The true owners are almost certainly reflected in the roster of primary dealers, who skim Federal Reserve units as they’re being made, but we don’t know much more than that.
So…
Who are the people that Yellen takes orders from?
What do these people want?
What are their long-term positions?
Who might they protect, aside from themselves?
We don’t have real answers to any of these questions. From our perspective, the guts of the machine are hidden behind a curtain.
One thing we do know is that the US has a strong hand. Within a general deflationary situation, the Fed can print away. And they’re propping up the US markets quite well… for now.
Feeling their power (after all, they can blow up more stuff than anyone else!), the US is throwing their weight around, forcing nearly every bank in the world to play by their rules. (Think FATCA and fining foreign banks.) And for the moment, it is working.
Bullying everyone else over the long term may, however, not be viable. No one – especially people like Putin and the Chinese bosses – likes to be slapped around in public. And they are not powerless.
Europe isn’t looking good. Japan isn’t looking good. The UK is holding, but as mentioned above, its numbers are horrible. Switzerland seems to be in-between strategies. China has problems. Russia has problems. The BRICS have never been stable.
That leaves the US. My impression is that most serious investors would rather hold dollars than yen or euros; most big businesses too. Their bets are on that the US will crash last.
So, are the Fed and the US Treasury doing this intentionally? Are they quietly pulling the pins out from under the others, making sure that they’ll be the last currency standing? I have no inside information, but I’d bet on it.
Remember, the gang on the Potomac has most Americans believing that whatever they do overseas is pure and holy. Furthermore, 99% of their serfs will reflexively obey any order they give. So, why shouldn’t they play dirty? They have the best bombs and a somnambulant public.
For now.
Paul Rosenberg
www.freemansperspective.com
It is an interesting historical fact that people who take part in rebellions tend to coin their own money – not when the rebellion concludes, but as it starts.
There is good evidence that silver half shekels, like the one pictured above, were actually minted on the Temple Mount during the Jewish Rebellion against Rome in 66-70 AD. (The wonderful Biblical Archaeology Review ran an article on the subject.)
And this case is hardly unique; there have been many rebellions that promptly issued their own currency. Here is Massachusetts currency from 1776, issued early in the American Revolutionary War:
The primary reason that rebels create their own currency is that monetary control is far more of a force than people realize. Baron Rothschild was not being overly flamboyant when he said, “Give me control over a nation’s money supply, and I care not who makes its laws.” Being able to manipulate a money supply is a fantastic power, affecting every part of an economy. If you know in advance that the money supply will go up (diluting its value) or contract (concentrating its value), you immediately gain a massive advantage over everyone else – and you can target this advantage to help or hurt almost any group you choose.
Because of this, a rebel group that is tied to their opponent’s money has nearly lost before the battles begin. Serious rebels learn this quickly.
The rebellion that we’re all part of is not an armed rebellion, but a moral rebellion. And, interestingly enough, our rebellion understood very early on that money was a primary factor in our enslavement.
The roots of our rebellion go back as far as the first oppressed man or woman who thought clearly about morality, whenever that was. In modern times, however, we can trace our rebellion back to the 1940s – a time in which Mises had already been examining the foundations of money, Hayek was interested in competing currencies, and Rand was examining the morality of money.
(I’m passing over very many good people in the above paragraph. May they forgive my brevity.)
In our lifetimes, we’ve had David Chaum’s work on digital cash, Orlin Grabbe’s work (both theoretical and practical), e-gold, Pecunix, networks of exchangers, subsidiary services, and, most recently, crypto-currencies, beginning with Bitcoin. Our moral rebellion is not slowing down.
What matters about all of these currencies (and many more I haven’t mentioned) is that they are all rebel currencies. Sure, a few criminals and Ponzi operators have made use of our technologies, but that’s simply unavoidable. How many crooks use government money? (Answer: all of them.)
I think it’s important to make a few points about this moral rebellion of ours:
Our rebellion money has actually done a fine job of supporting these two moral points. The supposed failures of these currencies were primarily that they couldn’t withstand coercive and violent attacks. In other words, they worked very well; their “problems” were attacks from the status quo: a system of coercion and violence, masquerading as justice.
What we are now seeing is a moral awakening. Young people are questioning the systems that supposedly sustain them but actually use them as slaves.
When people begin to see the world in moral terms, they quickly perceive the deep immorality of the status quo – a system that is utterly dependent upon coercion and deception. If there is a root to the continuance and success of honest, rebel money, this is it.
In the end, our battle is this: morality versus coercion and deception.
Paul Rosenberg
FreemansPerspective.com
I’m going to use a couple of passages from the Bible (the original set of moral standards for our Western civilization), followed by an examination of both Bitcoin and cartel money, to see how they hold up in comparison.
As for my use of the term “cartel money,” it’s the best short description I know for the dollars, euros, yen (and so on) that we use in our daily commerce. They are produced by secretive and monopolistic groups of private banks. That rather precisely matches the definition of cartel.
I think by now we have all heard the big accusation against Bitcoin – that it is used for “money laundering” – made especially by the money cartels (the European Central Bank first).
First off, that doesn’t make sense to me. A currency is supposed to be neutral – that is its purpose. So, accusing a currency of money laundering is like jailing a knife for murder. But, that’s not precisely the point we’re addressing here.
Rather, the question is: do the cartels do the same thing that they condemn?
You bet they do!
Read this story on HSBC. Then read this one on Wachovia. These banks laundered hundreds of billions of dollars – knowingly – for violent drug lords. And it gets worse: No one from either bank went to jail. Neither bank was shut down. Neither bank suffered more than a minor fine.
So, how much of a concern can money laundering really be to the cartels and their politician partners? Clearly none, or very close to none.
And, since the cartels accuse Bitcoin of being used for bad things, let’s be clear about the situation: Every mafioso on the planet uses cartel money. So do all the drug smugglers, terrorists, and pornographers.
Does Bitcoin accuse the money cartels? Nope. Bitcoin has no official operators to speak for it at all.
It is true that many Bitcoin users accuse the cartels of being manipulators, but, at least for now, there is no Bitcoin cartel that is even capable of manipulating the currency.
So, round one goes to Bitcoin: The cartels very clearly condemn themselves, and Bitcoin clearly does not.
When Bitcoin creator Satoshi Nakamoto posted his Bitcoin paper in 2008, he laid everything open for all to see. Then he wrote the Bitcoin program and left it “open source,” so anyone could see the programming.
The process of creating cartel money, on the other hand, is mostly hidden, purposely confused, and isn’t even taught to most Econ majors. And if you think that’s just my opinion, here’s one from the esteemed economist John Kenneth Galbraith:
The study of money, above all other fields in economics, is one in which complexity is used to disguise truth or to evade truth, not to reveal it.
The argument is made, of course, that the process of creating dollars, etc. is very complicated, and that people don’t understand it because of that.
I don’t think that’s true, but even so, let’s compare it to Bitcoin: Making bitcoins is also complex, but Bitcoin enthusiasts have been working night and day to explain their new currency and how it works. I’ve seen them cornering people at birthday parties, trying to make them understand.
Round two goes to Bitcoin also. Bitcoin wants to be seen and known, and the cartels surely do not.
Satoshi Nakamoto began the original Bitcoin document by saying that he wanted to, “allow online payments to be sent directly from one party to another without going through a financial institution.” He goes on to say that he was creating,
an electronic payment system based on cryptographic proof instead of trust, allowing any two willing parties to transact directly with each other without the need for a trusted third party.
In other words, Satoshi wanted to remove the necessity of one man ruling another in the area of money. Furthermore, he did it, then went away.
As for the motives of the cartel, we can’t really tell. The visible heads of the Federal Reserve are certainly not the owners of the Federal Reserve, and the US government refuses to reveal the names of the owners.
Perhaps the closest real examination of their motives comes from a renowned professor who worked for them for a few years. Professor Carroll Quigley of Georgetown – and a major influence on none other than Bill Clinton, wrote this in his book Tragedy & Hope:
The powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent private meetings and conferences. The apex of the system was to be the Bank for International Settlements in Basle, Switzerland, a private bank owned and controlled by the world’s central banks which were themselves private corporations. Each central bank… sought to dominate its government by its ability to control Treasury loans, to manipulate foreign exchanges, to influence the level of economic activity in the country, and to influence cooperative politicians by subsequent rewards in the business world.
So, was Quigley right? I have no solid proof that he is, but he would be an awfully hard witness to impeach. One substantiation that comes to mind is a recent comment by Illinois Senator Dick Durbin. In the midst of a political fight, he complained, “The banks own the Senate.”
That’s not really proof either, but it is interesting.
You can make up your own mind on the banks, but Satoshi’s motives are fairly well beyond question.
I think it is clear that from a moral standpoint, Bitcoin is far, far better than cartel money. (As are silver and gold.)
So, the next time you hear someone calling Bitcoin dangerous and evil, don’t let them get away with it!
Paul Rosenberg
FreemansPerspective.com
