Back in the U.S.S.A.
The Soviet economy was largely fake, almost all of it controlled by the Communist Party. Government deficits supported a bloated military that looked powerful on paper but couldn't win a war.
Friday, June 21, 2024
Bill Bonner, writing today from Poitou, France
The best government is a benevolent tyranny tempered by an occasional assassination.
Voltaire
There are the elites... and there are ‘the people.’
Yes, the rich are different. But it’s not just a matter of money, they also have power.
It is as if they lived in ‘two separate countries,’ says Stephen Moore.
The elites live on the two coasts. They send their children to good schools and universities. They work in the ‘talking professions’; that is, they don’t sweat with hammers, drills, grills, machines or chemicals. Instead, they bend ideas, information and spreadsheets — as investors, lawyers, journalists, professors and managers. They earn more money. They live in bigger houses. But they weigh less, on average, than MAGA supporters... .and they wouldn’t be caught dead at a Trump rally.
As socialite Ms. J. Gordon Douglas once put it, among the elite, ‘you can’t be too rich or too thin.’
The Rasmussen polling organization took their pulse at the end of last year, reporting the results in January. They defined the elite as having at least one postgraduate degree after graduating from an Ivy league college, $150,000-plus income, and living in a ‘dense urban area.’ This probably defines more of a super-elite than the top 20%... but it is something the rest of them can aspire to.
What did they find? Moore summarizes:
Nearly three-quarters of the elites surveyed believe they are better off now financially than they were when Joe Biden entered the White House. Less than 20% of ordinary Americans feel the same way....Elites are three times more likely than all Americans to say there is too much individual freedom in the country. Astonishingly, almost half of the elites and almost 6 of 10 ivy leaguers say there is too much freedom.
An astonishing 72% of the elites — including 81% of the elites who graduated from the top universities — favor banning gas cars. And majorities of elites would ban gas stoves, nonessential air travel, SUVs and private air conditioning.
Most elites think that teachers’ unions and school administrators should control the agenda of schools. Most mainstream Americans think that parents should make these decisions.
Oh, and about three-quarters of these cultural elites are Biden supporters.
Moore comments:
The snobs thumb their collective noses at the unrefined working-class Americans. The elites believe they are intellectually, culturally and morally superior to the working class and rural America….Crime, illegal immigration, inflation, fentanyl and factory closings aren't keeping the elite up at night because in their cocoons, they don't encounter these problems on a daily basis the way so many Americans do today. Not too many main street Americans are losing sleep about climate change or LGBTQ issues.
But the situation does not describe merely a political divide. It is not just a matter of Republicans versus Democrats... not a case of good guys versus bad guys. If you vote for Donald Trump you may think you will end the elites’ control. But that’s not how it works. If you rid yourself of one group... another will take its place. Like the poor, the elites will always be with us.
The coming election will make little difference... no matter which way it goes. Because both parties are frauds. They merely represent different aspects of elite America; neither represents ‘the people.’ Both have been corrupted by power and money; both have signed on to the important parts of elite agenda — more spending, more war, and more debt.
Both Republicans and Democrats have been suborned... neither dares oppose the powerful elites that support them. That’s why debt ‘ceilings’ never hold... budgets are never balanced... and US troops still lounge at more than seven hundred overseas bases – decades after the need for them disappeared.
Soviet America
Historian Niall Ferguson likens the US situation circa 2024 to a “late, Soviet America.” He notes that in 1990, observers were noticing a “ghastly and tragic... loss of morality” within the USSR. “Apathy and hypocrisy, cynicism, servility, and snitching,” were running wild. Nearly half the population thought that theirs was an “unjust society.” USSR leaders were old party hacks — Brezhnev, Kuznetsov, Andropov, Chernenko — or just ineffective.
The Soviet economy was largely fake... almost all of it directly or indirectly controlled by the Communist Party. The government ran chronic deficits... supporting a bloated military that looked powerful, on paper, but couldn’t win a war.
“Sound familiar?” asks Ferguson:
Look at the most recent Gallup surveys of American opinion and one finds a similar disillusionment. The share of the public that has confidence in the Supreme Court, the banks, public schools, the presidency, large technology companies, and organized labor is somewhere between 25 percent and 27 percent. For newspapers, the criminal justice system, television news, big business, and Congress, it’s below 20 percent. For Congress, it’s 8 percent. Average confidence in major institutions is roughly half what it was in 1979.
We gave up trying to solve the nation’s problems a long time ago. Today, we merely try to anticipate them.
It’s not the Democrats’ fault. Nor the Republicans’. Both are tools of degenerate elites, who are likely to drag the country further and further into debt, inflation... and war.
Expect a long period of chaos — financial, political and social. And watch out for the guillotine.
Regards,
Bill Bonner
Research Note, by Dan Denning
Of the 69 central banks surveyed by the World Gold Council in their study of central bank gold reserves, not one of them plans to decrease their gold holdings in the next twelve months. You can review the survey (with much more readable charts) here. But what does it mean?
For central banks, gold is a reserve asset. It’s liquid. And it poses no default risk, unlike sovereign bonds issued by governments. Central banks buy gold out of tradition and caution. They also contribute to the demand that sends the gold price higher (gold is up 14.7%, year-to-date).
Later today, Bonner Private Research will release the annual update of our Strategy Report. For new subscribers, this is the easiest and fastest way to see where we’re advising you have your money over the next year (and the next ten years). The report will also be available as a downloadable PDF.
Finally the truth! Friends, we're on the roller coaster; the bar has come down, locking us in, and the little train has left its boarding area. You and I are on the thing for the duration of the ride. The time to worry about the roller coaster and its shocks and thrills is BEFORE you board, NOT when you're on it. There is one thing that can change the arrangement: complete financial collapse. It's the only thing beyond their reach. I think the majority will choose "better Red than dead." Me? I find it liberating to realize I no longer need to waste time, labor, or, especially mental energy, on a failed enterprise. It's too bad it came to this, but we could literally not stand prosperity. Best always. PM
I rarely disagree with anything Mr. Bonner and friends have to say, but I would argue that this time around there is a huge difference between the parties: energy policy. If the dems win, the insane war on fossil fuels will continue, to the detriment of all economies, and all but the elites. If the Obnoxious Blowhard wins, we may be able to put the fantasy of the Green New Scam behind us. As the data centers that AI demands are built, the grid will need more reliable, not intermittent, power.
I find it hard to believe that most of us favor the war on the first amendment, the war on meritocracy, gender silliness, and the rest of the woke agenda. Then again, I live in Flyover America.