Below we look at the forgotten America, the US Middle Class.
The Current America: War Hawks and Wall Street in Bed with DC
Recently, while visiting The Arlington National Cemetery, I shot a brief video discussing the fiscal cost of the Warfare State.
The points I made were economic, not personal. Below, I get more personal…
Rights Exchanged for Security
In a nutshell, I simply wished to suggest that our coastlines are not subject to any pressing Jihadist invasion threat and, as a result, perhaps an annual military spend of $800 Billion is worth a second thought?
These military numbers, by the way, don’t include the boon of pork being handed out to our “Intel State”—which includes a pell-mell of 17 sub-agencies (CIA to NSA) tasked with keeping us “safe for democracy” by essentially removing large swaths of our Constitutionally and democratically protected rights.
The ironies do abound…
As for those bygone rights, I am referring to those little gems, you know, like the right to privacy (gone), habeas corpus (gone), protection from illegal search and seizure (gone) and free speech (here in form, but gone in substance, with 5 conglomerates running the “Fourth Estate” of a highly censored–and frankly stupid–US main stream media).
Some will say, of course, that with the threat of terror apparently everywhere, giving up certain liberties in the name of security is simply a necessary evil, and one that must be embraced in extreme circumstances such as the post-9-11 world.
But I’ll remind us that Ben Franklin, who also knew a thing or two about extreme circumstances in the U.S., wisely remarked that “those who surrender liberty in the name of security deserve neither.”
Besides, even if some crazy second-cousin of ISIS wants to set off a dirty bomb in Cleveland, I’m not sure how another US Aircraft carrier is going to prevent this.
Free Markets Exchanged for Fed Control
As for free markets, they too are gone, replaced instead by a Central Bank.
Supply and demand, as well as normal business cycles–including healthy recessions, died long ago when that impressive looking building on Constitution Ave, with its equally impressive title—the Federal Reserve—emerged from the pen of Woodrow Wilson in 1913.
It’s worth noting here that Wilson, perhaps one of our worst Presidents, nevertheless admitted that signing the magical money maker (i.e. that bank cartel otherwise known as the Federal Reserve) into law was not only the darkest day in his life, but in the history of this country…
It’s also worth noting that the Federal Reserve, which is a privately-owned bank, is neither Federal nor a reserve. Just saying…
In fact, it is prior permutation, the US central bank was described by Andrew Jackson as the “prostitution of our government for the advancement of the few at the expense of the many.”
Truer words were never spoken.
And as I’ve written here, here and here, and just about everywhere else here, the Federal Reserve is an entirely false hero, soon to be un-masked.
It has done nothing but distort the credit markets, buy us time and an entirely fake recovery (benefiting the top 10% of our country), and is responsible for creating the biggest securities bubble (and pending crash) ever seen—one poised to unleash the worst economic recession in US history in the coming years—if not sooner.
I wonder if Bernanke will still be on his book tour then?
Why such concern with the Fed?
Because its idea of solving a debt crisis (think 2008) is based on creating more debt (think today). Ask John Law of 1721 or the French Assembly of 1793 how well that idea works…
In fact, ask any economic historian who isn’t on the Fed payroll, and they’ll confirm it. Better yet, read a little more von Mises and little less John Keynes.
But if you want an even quicker summary as to why this is not a rant, but an historical as well as mathematical fact, you can also listen to this brief podcast here.
But I digress…
The American Ideal—Lost?
I want to get back to what was not said in my video among Section 60 at Arlington, where more than one person with whom I once shared beers, time and memories are now permanently residing—which is to say: also gone.
Why? Because, like my colleague Thomas Lott (a veteran who left Yale in 1968 to spend the first years of his then blonde youth in Vietnam), they believed in this country, in each other and in the promise of our national ideals.
Red or blue, we all, I surmise, share those same beliefs.
As for the endless war on terror, I will never, not ever, reveal in a public blog what I think (and know) of its origins.
Nor will I name the civilian Pentagon officials who lobbied and pushed this global war well beyond its necessary expiration date for financial and political motives that have little to do with national security and far more to do with a few well-funded lobbies off K-Street and their private checking accounts.
Such political and financial dishonor, in the DC shadows, however, takes nothing, and I mean NOTHING, away from the military honor of the men and women lying in Arlington or the countless small cemeteries across this country.
They served an ideal, and represent the American ideal. Full stop. Period.
But is the American Ideal Serving Us?
In this backdrop, we also need to ask this: Is the ideal that once was Washington DC serving the people it governs?
In school, from the Pledge of Allegiance of the first grade all the way to the Constitution I revered (and studied) in law school, the separation of powers, and even of the Church and State, for example, made sense.
That is, the Enlightenment ideals of Madison, Jefferson and Adams, gave me—and all of us– a compass worth following and a nation worth supporting—be it with a rifle, a pen, a dollar or a legal brief.
What made equal sense was the balance of powers of our three branches of government, as well as the separation of war-lobbyists (legalized bribery) and State, as well as the separation of Wall Street and State.
I believed this then, and believe this still.
But something has gone amiss.
In the years since I left the ivied walls of constitutional law and theory to live in the actual halls of practice (which includes forays into the Intel State and Wall Street realities), I’ve seen an increasing encroachment on these ideals.
Military and State, Wall Street and State: Not Part of the Original Plan
Stated more bluntly, Wall Street, like K-Street, is no longer separate from our “State,” but frankly sleeping in the same dirty sheets.
Folks, this is a very dangerous trend.
The power, for example, that the Fed directly has over our markets, and thus indirectly over our economy, is nothing short of appalling. In “saving us” from 08 pain, they are going to destroy us with the “cure.”
In my father’s markets, the Fed was an unknown blip on Wall Street. Today, it’s the new Wizard of Oz—the center of nearly every market headline and discussion…
Meanwhile, the rise of the warfare state that Eisenhower warned of in 1961 is no different. It has metastisised from a collection of brave West-Pointers and military professionals into a cesspool of highly questionable civilian “advisors.”
And these same National Security “advisors” who have slithered into the ears of Presidents Bush-1 through Trump, have consistently pushed a military agenda overseas that has less and less to do with America’s security than one might otherwise want to consider.
But again, I won’t and can’t go there.
But I will encourage you to ask yourselves just what American security interests you feel justify thousands of US boots on the ground today in Iraq, Syria, Jordan, and soon, possibly Iran?
Is it to avenge 9-11? To capture Osama bin Laden? To find those weapons of mass destruction?
Do your own thinking, your own fact-finding, your own research and common-sense smell-testing. I’m not here to stand on a soap box, but simply to request you create your own.
Folks, do a little research…
Most of you, I’ll wager, are already asking yourselves such questions. And those of you who voted for Trump, you’ll recall that he was particularly vocal and brave, at least in the primaries, about getting Americans OUT of foreign-war nightmares like Syria et al.
And yet we are still there—rattling swords with names like Russia and Iran over a northern chunk of (oil rich) territory in Syria…
But even Trump, it seems, could not fend off the cackle of war hawks who lurk in the shadows (and his national security board) of the very swamp he pledged to drain.
Also, the sons and daughters of Trump, Obama, Kushner et al will not likely be carrying M-4’s anytime soon into the streets of Ramadi, Aleppo or even Tehran.
And needless to say, most of the sons and daughters of the top 1-5% here on Wall Street are not lying in Section 60 of Arlington. Don’t believe me? I have the numbers…
But this by no means suggests that patriotism and military service is ignored by the middle or even rising upper class. In fact, one-half of our enlisted recruits come from the top 40% of the US income distribution.
Nevertheless, the bulk of our volunteers stem from that ever-shrinking, median income family —that “other America” in the $65,000 income range.
This is the America largely between our two fancy coasts, coasts that I know all-too-well in my so-called “fancy life” and “fancy schools.”
But like my colleague Tom, I know that middle, fly-over America as well—it’s where I grew up, held a baseball in my fist, and made friends who’d later enlist in wars while I won scholarships to those shiny campuses out East.
And don’t get me wrong, the sons and daughters of Choate, Andover and Harvard have made their own contributions to service, be it with or without a gun.
There are numerous ways to stand up for one’s ideals.
But when it comes to risk, war or economic hardship, it is becoming increasingly undeniable that middle America—the one that Wall Street forgot and that the Pentagon takes for granted—tends to suffer the most when things get, well: distorted…
Which, at long last, brings me to the point of this fairly unusual yet highly personal blog. Things are bad, and getting worse, for the majority of Americans.
Middle America—and the US Middle Class—Has Been Forgotten
And my point is this: Middle America, that is, the America that struggles, believes and works to make and keep America’s foundation strong, is at its greatest risk today.
Because that America—the heart of this country—has been overlooked by the country they still believe in.
If you think this is just an opinion from a Wall Street apologist or Ivy-League cad, then let me leave you with some facts rather than platitudes.
By the way, I saved these facts for the end because I want them to sink in. To stick.
And here they are—check them for yourselves:
- 52% of American children live in homes supported by the welfare state. And what’s even worse, this is nothing new—but part of a long, buried American truth.
- 40% of US Households today could not raise $400 in cash in case of an emergency without having to sell something.
- According to the Social Security Administration, 50% of all American workers made less than $30,500 dollars last year.
- This means that nearly 50% of American “middle class” families live just $1000 above the national and federal poverty level for a family of five ($29,420).
In short, the historical backbone of this great country, the landscape that I was born into, is well…crumbling.
So, tell me this: do you still think our nation is strong, or have you just confused an East Coast stock bubble with a roaring middle America?
And the next time you hear one of those talking bubble-heads on the left or right financial media swoon about “surging GDP growth,” “record high employment” and the next tech stock to “beat earnings expectations,” please come back to earth.
That is, turn off the propaganda and turn on your common sense, which any one of us, whether on Madison Avenue, Malibu Beach or Main Street Ohio, should already know.
In short: America, from Arlington Cemetery to Stevensville Michigan, is not what the pundits say it is.
And what’s even more disturbing about the foregoing facts is this: The Recession we are tracking here at Signals Matter is lurking over the horizon.
In other words, that shark fin (or bond wave) of rising rates is approaching our rickety debt bubble, and most of this country is not only (and unfairly) unprepared, they had nothing to do with it.
The same, of course, cannot be said of those fancy lads in DC and Wall Street—the ones who have forgotten the rest of America as they pocket a fortune in the Fed carry trade or lobby for military contracts in the swamp.
In short: The one’s who bailed out Manhattan’s banks yet turned their backs on Main Street.
Tom and I have not forgotten Main Street. We literally grew up on it.
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