Go Foward or Crash?
Wednesday, March 17th, 2010
The Automatic Earth — Ilargi writes: Tim Geithner and Christina Romer tried to paint another rosy economic picture in front of the House Appropriations Committee (”there’s progress, though it’s challenging”), but even their own fellow Democrats don’t buy into it anymore. American politics as a system has ceased to function, because the system has gone from representing people to representing money. And that is something that can only go well as long as the people have at least some of that money. Now that they’re increasingly shut out, the system shuts down; it’s inevitable. Which is why even rating agency Moody’s comes with an at first glance curious warning: even the credit raters now predict pitchforks.
We’ve seen tear gas in Athens recently, and that was just a little taste. As you may know, I’m spending some time in France right now, and it’s not hard to predict what will happen here if and when the government starts slashing salaries (as it must soon). The French simply won’t understand what’s happening, and mass protests will be the result, some peaceful, some violent. It’s every democratic politician’s ultimate conundrum: if you don’t tell people the truth, they’ll turn against you down the line; if you do tell them, they’ll turn against you right away. That makes it obvious to figure out which politicians actually do get elected. Where the government is left, it will swing right, and vice versa, in ever more extreme denominations.
And yet, it’s all just a prologue. There’s nothing easier for politicians than to play people against each other, in order to divert -negative- attention away from themselves. And so they will.
We have a baby boomer generation that has just about all the money that’s left in our societies. Their children, though, have nothing. Except for some hand-outs from their parents (I’m not talking individuals here). Unemployment among young people in many countries is downright scary, often in the 40%-50% range. No jobs, no money, no prospects. In times and places throughout history, this has brought populist dictators to the foreground, and pitchforks and torches into the streets, and there is no reason why it won’t now. Today’s political power is firmly in the hands of the 40-year and older crowd; they have elected incumbent politicians, and more importantly, they have the money and thus the power. The younger generation has no money and no power, but they also have nothing left to lose.
That is a dangerous combination, and how we deal with it will be what decides our futures. …
Most people are far too complacent when it comes to the consequences of a shrinking economic system. Many claim that we can easily downsize to smaller homes and smaller lives, since there’s so much we don’t really need anyway, that we will move in together and return to “good” conversations, growing our own tomatoes and all that. But that’s just not going to happen voluntarily, not on a large and wide scale. The human mind has no reverse. It doesn’t even have a steering wheel. We are built for one of two things: go forward or crash. It looks like there’s no forward left before a major crash happens first. It also looks like there’s not a whole lot of people who realize this. (03/17/10)

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