The Beast Called Capitalism

The Beast Called Capitalism

by Paul J. Bern

(selected from chapter 4 of his latest release, "Occupying America: We Shall Overcome")

Why is it so untouchable and radical to even suggest auditing the Federal Reserve to those in charge of it? In my research I found that many believe that if our Government dared to audit the Federal Reserve (as you would naturally do with any business that handled huge flows of your money) its books would be so horrifyingly off that they would have to be shut down. Clear back in June 2009 CNBC did an interview with Jim Grant, editor of Grant Interest Rate Observer. He essentially told them that the Federal Reserve couldn't possibly withstand the scrutiny of an audit and it would have to be shut down if the money discrepancies and disaster were known.

It has been known for some time that the Fed is not part of our Government, but a private corporation we did stupid business with back in 1913. Lately, we see them making all kinds of money on our out-of-control “national debt” (a loan-sharking scheme if ever there was one), paying off big banking friends with back door deals and simply growing our debt that they and their cronies are making tons of money off of. Think of the orgy of delight they have going. No audit since 1913. I can think of several reasons are clearly stated as to why the Federal Reserve is at the heart of our economic meltdown. Just a few of these include:

• The Fed is a debt based financial system.
• The Fed has a monopoly on the creation of this debt based money.
• The power of money creation and debt creation is in the hands of private individuals, not the US Government, according to the US Constitution.
• The Federal Reserve itself is not much of a profit – making institution. Rather it is a tool that enables others to make obscene amounts of money.
• The Federal Reserve has decided to play bizarre games of questionable legality with our money.
• The Federal Reserve is undemocratic while it runs an American economy based on democracy. Calling this a conflict of interest is putting it mildly.

All the branches of Government – including the allegedly “private” company of the FED must be audited and held accountable to the American people or be shut down. There needs to be national and constitutional reasons to even keep Federal departments open, such as the Dept. of Energy, Dept. of Education and a whole host of others. I want to know if they are doing their jobs or duplicating the work of states. Regarding the Dept. of energy, hmmmm – after decades, are we energy independent yet? Do we have more nuclear, oil and natural gas infrastructure? Have we been able to disengage from OPEC and start exporting energy? No, no, and no. It is time to shut them all down.

The final example of counterfeit wealth that I will cite in this chapter is that of the collapsing US real estate market. It is apparent to all who have been keeping track of this collapse that this has all been by design. Wall Street and the banking sector, combined with real estate and mortgage brokers who were too smart for their own good, have run American property values right into the ground for their own enrichment. In the process, the US middle and working classes have seen their single biggest investment that they will ever make – their homes, vacation homes and other investment properties – continue to lose resale value like a troublesome car that needs an expensive repair. It costs more to keep either of them than regular working folks can afford. Housing prices are likely to keep falling the rest of this year, and probably won't show much improvement in 2013 either, according to a survey of economists. A CNNMoney exclusive survey of 27 economists showed the battered US housing market is facing myriad problems and won't turn around anytime soon. The median forecast was for a 3.9% decline in the second quarter compared to a year earlier, and a 2.9% drop in prices over the course of the full year. I firmly believe that there will be further significant declines in home prices in order to set a true bottom for the market. To put it succinctly, the bottom of the housing crash is yet to be determined. Homeowners and lenders alike are justifiably apprehensive about the possible outcome and its repercussions.

One definite outcome will be the death of American suburbia, or at least as we have known it. For decades, Americans have consumed more energy, built bigger houses, and driven more miles with each passing year, but not anymore. Along the way, there were three inexorable trends at the base of the societal pyramid. First, we plowed more energy into our homes each and every year. We cooled and heated our houses more (sometimes wastefully, sometimes not), brought in more and more appliances, added televisions and computers and phones. Per capita electricity shot up from about 4,000 kilowatt-hours per US resident in 1980 to over 13,000 kilowatt-hours by the 2000s. Second, we needed more electricity because our houses got huge. The median home size shot up from about 1,500 square feet in the early 1970s to more than 2,200 square feet in the mid-2000's. Third, we drove more and more miles every year to get around and between our sprawled-out cities. Back in 1960, Americans drove 0.72 trillion miles. By 2000, that number had reached 2.75 trillion miles. In 2007, the last year this data is available as of this writing, vehicle miles traveled hit 3.02 trillion.

The beast called capitalism is so consumed with its own greed that it has started feeding on itself. The interest that is accruing on the money it lends is adding up faster than the principals can be repaid. Capitalism constantly tries to fill its belly, craving to soothe a spiritual hunger that it has mistaken for physical needs and wants. Capitalism has the whole world, from developed countries like the US, Canada and Europe to third world backwater nations, drowning in endless debt. It is similar to someone who is “upside down” on a home loan or a car note, owing more on the home or vehicle than it's worth. It is also noticeably similar to what is happening with student loans, with the interest accruing faster than the principal can be paid down due to the income limitations of the recent graduates – assuming they have any income at all. Interest on the national debts of other developed countries is also adding up faster than their debts can ever be repaid. Therefore big banking effectively “owns” those countries. Why conquer a country when you can just buy one by burying it with debt? Nice people.

But lately I have observed that things have reached a tipping point, and there is a real possibility that some countries could be forced to default on their own obligations, ruining their credit ratings and making it difficult, if not impossible, for them to borrow additional funds to pay off their previously incurred debts. In other words these countries, especially the US, are taking out loans to pay off other loans, and there is no practical way this practice can be continued. It's all just a great big Ponzi scheme, and it will come to an end, as all Ponzi schemes do. And when that happens, you better look out. But even if all this turns out to be a false alarm, there are 4 other ways that America's economy can be seriously disrupted, but which will not affect the top 1%.

[1] Another war, and America is preparing for exactly that. So are Russia, China and the Arab countries, in case you didn't notice. The other Asian Muslim countries such as those in southwestern Russia and Pakistan would also be included. There are also the wild card countries of Israel and North Korea. If either of those countries goes to war, particularly Israel, take cover immediately or go home and stay there until it's safe, because the nukes will definitely be flying. This is not a drill.

[2] A natural disaster, which is inevitable sooner or later, particularly within the USA. For example, a category 4 or 5 hurricane hits the Houston, Texas area where the majority of America's oil refineries are located, disrupting US fuel supplies for weeks. In that event, gas prices would go to between $5.00 and $7.00 per gallon, if any fuel can be had at all. Another example: earthquakes. From what I know about American earthquake fault lines, having studied the matter in my spare time, is that anyone living on the US west coast or along the upper Mississippi river valley should seriously consider moving starting right now. Ditto for floods, particularly in the upper Midwestern US, parts of Louisiana, and south Florida. You are free to disagree with me on any or all of these points, of course, but those who choose to ignore me do so at their own risk.

[3] An oil embargo or blockade, with particular focus on Saudi Arabia and Iran. America imports over one fourth of its petroleum from Saudi Arabia. Although it is considered an American ally, it has much closer ties to the Islamic republics and dictatorships of the Middle East than Washington would like you to think. If Saudi Arabia were to turn against us in a future Mideast war, it would result in immediate gas rationing here at home. Then there is the wild card of Iran and its proximity to the Strait of Hormuz where the Arabian sea empties into the Indian ocean. Fully 20% of all the world's oil flows through this narrow stretch of water. If Iran closes the Strait of Hormuz, the world's economy would go into a tailspin. Here at home, if either one of these scenarios were to play themselves out, we will see gas prices well in excess of $6.00 per gallon. As in the second possibility listed above, the price of gallon of gas could spike to in excess of $7.00 per gallon. Either of these occurrences would plunge the entire world into an economic depression, and into a third world war as well.

[4] A large-scale terrorist attack anywhere in the world and especially here in the US, with the most likely scenarios being chemical, biological, or nuclear in nature. Another possibility is the release of an Electromagnetic Pulse, or EMP, that would disable Internet, wireless, aviation, TV and radio communication for days or weeks, maybe even months in a worst-case example. In that event, the majority of our electronic equipment would have to be replaced, from our computers to our telephone and utility networks. Even the on-board computers in our cars and trucks would have to be replaced, meaning our engines will not start and our GPS devices would be useless. The avionics in many modern planes, including military aircraft, would cease to function, grounding all of them. In other words, an EMP would shut down the entire country, or at least parts of it, depending on how close to the source one may be. As in the examples above, economic and social pandemonium would result. The only two good things that I see that could come from that particular event is that it would destroy capitalism, since big banking and Wall Street's infrastructure are heavily dependent on computer technology, and it would destroy or render useless much of the military hardware currently in existence, making waging war impossible.

As the capitalist economic system continues to implode in slow motion like the twin towers of 9-11, the top 1% have become acutely aware of the fact that they are almost out of time. They are rushing to patch up the system just a little bit longer so that they can continue to milk America's economy and assets dry. By the same token, they are worried about the rise of the Occupy and 99% Movements, and rightfully so. The wealthy and well-connected top 1% see these movements as a threat – and well they should – and I am proud to be affiliated with them both. They are concerned that America's people might decide to take back what was taken from them, which is the Constitutional ownership of this great land of ours. And so the top 1% are waging an economic and class-based civil war within the boundaries of the United States against the remaining 99% of us, the true-blue and red-blooded backbone of America. We the people, as our Constitution says, are the true owners of this land of ours because that's what our laws say, and we are a nation of law-abiding and mostly peaceful people. As it is written in the Declaration of Independence, “In order to secure these rights, governments are instituted among men and women, deriving their just powers from the consent of the governed, to such an extent that whenever any form of government becomes destructive to these ends, it becomes the right of the American people to alter or abolish it” …

Based on these words written by Thomas Jefferson, 21^st century Americans of all races, nationalities, religions and backgrounds have a moral obligation and a spiritual duty to alter or abolish the US government in its current form for the primary purpose of crafting a replacement, even if it means calling another Constitutional Convention – something that hasn't happened in too long a time. Who knows what the future might hold – only God knows. But if we unite together as one American people, we most definitely do have the power to change its outcome.