As I write this, I feel as if I’ve been transported back to the months before 1929’s Black Thursday and 1941’s attack on Pearl Harbor, both at the same time.
There’s lot’s to cover. We’ll begin with the fact that it’s election season again. In case you have not guessed, I loathe governments. Since the beginning of history, they have been despicable organizations that attract the worst kinds of people — those who obey orders without regard to ethics.
Before I go further, let me make clear that the country and the government are not the same thing. The American founders understood this, and created the Constitution as an attempt to keep their new government from destroying the country. It worked, for a while.
Can anyone doubt that by far the greatest amount of robbery, murder, torture, enslavement, genocide, kidnapping, vandalism and fraud around the world have been committed by governments?
Those who believe politics will solve their problems are living in a world of unicorns and rainbows.
Today politicians and bureaucrats have so much power they encroach on every corner of our lives. Therefore, achieving — and keeping — whatever we each regard as the good life depends more and more on a deep understanding of the cancer called politics.
A primary mission of Early Warning Report is to help you cope with this plague and, as much as we can ethically do so, find ways to be on the receiving end instead of the paying end of its alterations in flows of money. More about these flows shortly.
First we need to strip politics down to its essentials, so we can see what is really going on. Much of this EWR will be quick refresher points about the true behavior of governments. It’s nothing like what we were taught in school.
The first point is, governments have no wealth of their own. They only have what they seize from others. Therefore, as political philosopher Karl Hess said to me often, to give, a government must first take away.
This means politics all over the world operates in the same fundamental way. Here it is in one short paragraph.
A politician stands before a crowd and shouts, “If you put me in power, I will give you everything you want and you won’t need to pay for it! I will force the person standing next to you to pay for it!” And the crowd cheers.
H.L. Mencken: “Every election is a sort of advance auction of stolen goods.”
By and large, the power junkies who conduct this hoax most convincingly are the ones who get elected.
This is the foundation not only of democracies, but of republics, dictatorships, monarchies and all other forms of government. At bottom, a power junkie keeps his office only as long as his population refrains from removing him — with ballots, bricks or bullets. So the population is bribed into submission by convincing them they are getting something for nothing.
I also loathe members of the entertainment industry who teach that government is our superhero. The premise of the TV show Criminal Minds is, if you are in trouble, an ace team of FBI agents will pile aboard a luxurious $48 million Gulfstream jet and fly to your rescue.
This government-as-superhero propaganda has dire consequences. Remember Hurricane Katrina. Hundreds died standing around waiting for the government to save them.
I once met an American woman who was caught in an ambush while on safari in Africa. Hiding under a truck waiting to be discovered and killed, she said she kept wondering, where are the Marines, why don’t the Marines come?
Lots of bright people work for governments. Public employees tend to be much smarter than the general population. PhD levels of intelligence are not uncommon. (See “Why Your Postman May Be Smarter Than He Looks,” Forbes website, May 27, 2011.)
But the intelligence of an organization is not the same thing as the intelligence of its members. Government organizations are designed to be dumb as a rock.
They are tax supported.
When a group acquires the privilege of taking money by force, what incentive do they have to clean house, to clear out the deadwood, to improve their product?
For the most part, deprived of the if-you-foul-up-you-go-broke discipline of a free market, governments are all-star football teams running plays written by monkeys.
It’s been my experience that when you need an assist, with anything from education to fixing potholes or finding lost mail, fine, contact them. Smart, well-intentioned, demoralized individuals from stupid, corrupt SNAFU mills will do their best to help. But don’t expect much.
(Research organizations such as the Cato Institute, Mises Institute and Foundation for Economic Education specialize in discovering ways to get things done without the “help” of governments. Google “libertarian think tanks.”)
This insanity will halt on the day the tax support stops. Until then, the primary key to lasting investment success will be to keep on dodging those unicorns and rainbows.
Editors note: Clearly, there are many strange things afoot in the world. Distortions of markets, distortions of culture. It’s wise to wonder what’s going to happen, and to take advantage of growth while also being prepared for crisis. How will you protect yourself in the next crisis? See our PDF guide that will show you exactly how. Click here to download it now.