James Howard Kunstler writes: Mr. Obama heads to Europe now where official hostility is rising against the Anglo-American method of pounding monetary sand down the rat-holes of “non-performing” debt, bankrupt enterprise, and bubble-levitated bonds. Our poised and charming Prez may escape personal obloquy from the quaint old-world street folk, but most of the other G-20 policy playerz take a dim view of the shell-and-pea games being played by the custodians of the world’s reserve currency, including front-end-loader bank bail-outs, the shuffling of worthless securities under TARPS and TARFS, the desperate efforts to prevent the sane re-pricing of real estate, the cannibalizing of treasuries by the Federal Reserve, the now-notorious hijacking of public “liquidity” injections by third parties like Goldman Sachs, and most generally the perceived sacrifice of everybody else’s greater good for the sake of maintaining Lloyd Blankfein’s cappuccino machine.

What’s going on now is nature’s way of telling you that America’s standard of living has to be reduced by something between 20 and 50 percent.  You can have it in the form of a compressive deflationary depression, including widespread bankruptciesÖ or you can have by way of inflation, in which money loses its value.  But there’s one basic qualification to this: the way down is not symmetrical with the way up.  That is, it’s really not just a matter of ratcheting down to a standard of living half of what it was, say, in 2006, because in the event all the various complex systems that support everyday life enter failure mode before our society re-sets at a theoretically lower level of equilibrium.

By this I mean our methods for getting food, for moving about the landscape, for deploying capital, for trading and manufacturing, for schooling, doctoring, and running public services all destabilize and, to some degree or other, fail to deliver their contribution to normal daily life.  Banking (capital deployment) is already mortally wounded.  It remains to be seen how this will affect the food supply half a year ahead in the harvest system.  Capital is as big an “input” for our method of farming as diesel fuel or fertilizers made from methane gas.  The failure of banking will combine with city and state insolvency to crush public transit, law enforcement, fire protection, and whatever flimsy local safety nets exist to keep the ultra-poor and helpless from die-off.  The lowering of living standards by 20 to 50 percent essentially eliminates all but the must critical commerce, meaning that most of the stores in the malls and strip malls lose their customers and shed employees, while the mall and strip mall owners lose their rents, and the bankers lose performing commercial real estate loans. As all this occurs, tax revenues go way down, schools can’t pay their employees or buy diesel fuel for their yellow bus fleets. More people lose the ability to carry health insurance.  Hospital emergency rooms are overwhelmed. Health care descends to Third World levels.  Meanwhile, pensions are destroyed, the elderly live on dog food and ketchup. (03/30/09)
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Ellen Brown writes: Nervous pundits are predicting the end of American life as we know it, after Fed Chairman Ben Bernanke announced on March 18 that he would be dropping yet another trillion dollars in helicopter money – up to $300 billion to buy long-term government bonds and an additional $750 billion to buy private debt, with the Term Asset-backed Securities Loan Facility (TALF) to be opened up for the sake of consumers and small businesses. The dollar immediately experienced its worst drop in 25 years, amid worries that the Fed’s intervention would spur hyperinflation. Typical of the concerned commentators expressing these sentiments was Mark Larson, who wrote in “Money and Markets” on March 20:

Tim Wood wrote in “Financial Sense” on March 21:

Commentators on the Financial Sense Newshour suggested that the Fed’s move toward “quantitative easing” would be looked back upon as the watershed event in the beginning of the end of the United States dollar. As explained in Wikipedia:

The Federal Reserve has the capacity to create money on its books and lend it to whomever it will. This credit may be extended to the public to replace the loans that banks have been unwilling or unable to make; but there is also a danger that we may just see more money being funneled to those same Wall Street banks that got us into this crisis in the first place. The Fed remains a privately-owned “bankers’ bank,” and it has not asked Congress’s permission before engaging in its new policy of massive “quantitative easing.” (03/30/09)
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BBC Environmental Science — Nasa scientist James Hansen, speaking ahead of a protest in Coventry against energy firm E.ON’s plans for a plant at Kingsnorth, Kent, said: “What has become clear from the science is that the climate system is much closer to dangerous consequences than we had realised even a few years ago.”

He said that reserves of readily available oil and gas, which people would continue to use, were already enough to push the planet into the “dangerous zone” of emissions.

“The only way we can prevent disaster for our children and grandchildren is to cut off the biggest source, coal,” he added.

A spokesman for E.ON said: “We are talking about one coal-fired power station that will hopefully be built in the UK in a 30-year period.

“In China and India they are building the equivalent of Kingsnorth every two weeks.”

He added: “However we recognise that we have to de-carbonise. Earlier in the week we called upon the government to fund carbon capture storage from day one in some form.

“Once one power station has managed carbon capture the technology can be exported. It’s not just a problem in Kent it’s a problem facing the world.” (03/30/09)
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