A rogue candidate won't get to first base. He won't get any campaign contributions. And he won't get media attention. The hacks will label him as 'unelectable' and make him invisible, too 'kooky' and 'fringy' to be worthy of serious attention.
Industry, the media, and the educated classes all line up in favor of acceptable candidates ...those who promise not to rock the boat. To get votes, of course, the candidate will promise "change"...but change is the last thing he will deliver. The elite don't want it. The lobbyists, fixers, meddlers, chiselers, and zombies don't want it. And you don't want it...not now...not after you have invested 4 years and $100,000 to get into it. Yes, you, college graduates, you've paid your dues. You've done your time. You've got your ticket. And you sure don't want someone coming along telling you that the system doesn't really work that way...that you've wasted your time and money...and that you are a fool for believing it.
No, you want to get in line and put your hand out.
Over the last 50 years, the amount of credit in the US has increased 50 times. This represented roughly $33 trillion in new money - purchasing power that hadn't existed previously. Richard Cantillon noticed in 1755 that when new money is added to a financial system it doesn't go to everyone equally. Instead, it goes to the people who control the system. Later, it trickles down to the chumps. And by then it has lost most of its value.
You're hoping that more new money is added. And that you - as aspiring members of the elite - get some of it. But, you're a little late to the party. You don't control the system. Old people control the system...the oligarchs. The fixers. The manipulators. The ones with the money. And the power. They're going to take the new money...and the old money. And then, the system is going to blow up before you get to the head of the line.
"Intertemporal discoordination' is the kind of expression you'd expect from a German. In this case it was Ludwig von Mises. He was Austrian. Same difference. The expression means that when the authorities meddle with the supply of money and credit, they inevitably make a mess of things. But it is a very special kind of mess. First, as Cantillon noticed, the insiders get first crack at the money. Second, the new money creates distortions and disruptions that doom the whole system to collapse.
The famous economist, John Maynard Keynes, explained the importance of credit as "a link between the present and the future." That's what that 'intertemporal' is all about. In a nutshell, your parents and the insiders get the new credit. You get the old debt.
I speak as something of an expert...or at a least a veteran...on this matter. Thirty years ago, I didn't think it was fair that my generation should run up so much government debt and expect you to pay for it. I put together a class action suit, against the US government, in which my son, Will, who was 7 years old at the time, was the primary plaintiff. A federal court ruled against us. It said we didn't have standing to sue. That was when Will and other youngsters faced $1.7 trillion of federal debt. Now, there's 10 times more federal debt. Economist Richard Duncan thinks it will go over $30 trillion before the whole thing blows up.
Why so much debt? Because it is the way the insiders transfer real wealth from you to them. The financial industry loans you money for houses, cars, you name it. And - in the case of mortgages - the loan will be backed by Fannie Mae. Mortgage loans rarely get paid off. Instead, they just go on forever, from one 'owner' to the next. That is how the financial industry came to be landlord to 44 million Americans. Where do the banks get the money they lend you? Out of nowhere.
But you're already acquainted with the credit system, aren't you? The average graduating student has about $25,000 in debt. Here in Baltimore the marginal tax rate is close to 50%. So, you'll have to clear $50,000 in income to pay it back.
When the Spanish conquered Latin America, their 'encomienda' system typically required only 40 days of work from their victims. The French conquered Madagascar; they forced male Hovas between the age of 16 and 60 to work 50 days per year. The US example is closer to that of Russia, where Tsar Paul I, in 1797, declared that 3 days a week was enough for serfs to give their lords and masters. That works out to nearly 150 days.
A 50% tax rate - federal, state, and local --is the equivalent of about 125 days of forced labor per year. Pretty steep. But that's just the beginning. In our system of crony democracy, all the major industries have whips in their hands.
And, now that you're out of college you can join the corvee.
Bill Bonner is the President & Founder of Agora Inc, an international publisher of financial and special interest books and newsletters.