Detroit, Riot City: In scenes better suited to a Third World country (above, and below right), tens of thousands of desperate people assemble outside Detroit's Cobo Center in the hope of receiving $3,500 emergency welfare aid disbursements. Unemployment in Detroit is nearly 29 percent.
An individual in the habit of passing bad checks can't complain that he's the victim of a criminal conspiracy if local merchants compare notes and decide not to take any more of his bank drafts. Such coordinated action isn't a "plot" or a "scheme" -- it's a form of cooperative self-defense by people who have been victimized by fraud.
The same principle applies to the alleged "conspiracy" against the U.S. dollar reported earlier this week by Robert Fisk of the London Independent:
"In the most profound financial change in recent Middle East history, Gulf Arabs are planning – along with China, Russia, Japan and France – to end dollar dealings for oil, moving instead to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar."
As Fisk pointed out in a follow-up report, the "de-dollarization" of the oil market -- a process Iran has already begun, which helps explain Washington's bellicosity toward Tehran -- "reflects a growing resentment in the Middle East, Europe and China at America's decades-long political as well as economic world dominance."
After unpacking that observation a little bit we should understand that the resentment has as much to do with the method Washington has employed to maintain its dominance, as with the fact of that dominance itself: Since the dollar was entirely de-coupled from gold in August 1971, Washington has essentially been running an empire on money borrowed from the same people it seeks to push around.
During the most hubristic phase of the Bush-Cheney regime, Pentagon "futurist" Thomas P.M. Barnett explained that in the global division of labor, countries like China make things, earn money, and lend that money to the U.S. Government. Washington, for its part, provides "security" in the form of wars, occupations, and other acts of mass destruction.
Barnett wrote an entire book -- The Pentagon's New Map -- based on that the assumption that this arrangement would define world affairs for at least the next several decades. The news that America's creditors aren't going to permit Washington to continue with its oddly impecunious imperialism was no more surprising than the revelation that Barnett is a crack-pot rather than an oracle.
Officials in all of the relevant countries hastily disavowed Fisk's report. This didn't prevent a flight to gold. In fact, the frantic efforts to sustain the fiction that the dollar is in any sense a store of value probably amplified the rush to gold, in the same sense that subjects of the Soviet state didn't believe tales of official corruption and abuse until they had been officially denied.
Washington's courtiers in the "respectable" media characterized the developments described by Fisk as a "plot" against the dollar, or a "sneak attack" against Washington's economic hegemony.
Oh, those damned Arabs -- how dare they want something of actual value in exchange for the world's most coveted commodity! Those devious Chinese -- by what right would they stop underwriting Washington's debt?
Strangely enough, none of those assailing the Arabs and Chinese for backing away from the dollar have seen fit to condemn the individual who actually recommended this course of action roughly a year and a half ago: Alan "Fifth Horseman of the Apocalypse" Greenspan.
As I noted at the time (see "Our Money's No Good Here," February 25, 2008), during a conference of the Gulf Cooperation Council in Jedda, Saudi Arabia, Greenspan -- the indispensable architect of the ongoing global depression -- urged the Arabs and their allies to abandon the dollar whose value Greenspan had done so much to destroy.
Since the creation of the Federal Reserve System in 1913, the dollar has lost 96 percent of its purchasing power. The fact that the dollar can be used to purchase anything of value is an abiding testimony to the power of official myths to contort the thinking process of human beings en masse.
There is nothing behind the dollar apart from the "full faith and credit" of the world's most powerful criminal syndicate -- well, that, and the willingness of oil-producing states to accept the dollar in exchange for petroleum. Cut that last lifeline, and there is nothing to impede the dollar's immediate fall into utter uselessness.
I find myself reminded of the old joke about an astrophysicist who is accosted after a public lecture by a crusty old man of decidedly pre-Copernican views of the universe.
"You seem like a very bright young fellow," the old man begins, seasoning his words with condescension he wasn't entitled to express, "but you've got it all wrong. You see, the earth is actually carried on the back of a giant turtle. That's the simple truth."
"But what supports that turtle?" inquires the astrophysicist with a mixture of amusement and annoyance."
"Why, another turtle, of course!" ripostes the old man.
"And what --" begins the increasingly irritated scholar, before being cut off.
"You're a clever fellow, but it won't work!" exclaims the old man. "It's turtles all the way down!"
Commissar Bernanke and other guardians of official monetary superstition are committed to preserving the delusion that prosperity can be sustained on the back of a currency that is backed by nothing but itself. It's dollars all the way down -- an infinite regression into worthlessness. And, pace the plans of the anti-dollar coalition described by Fisk, the descent shouldn't take nine years.
The term "apocalypse" refers to an unveiling, a revelation, a dramatic disclosure. We're in the early stages of a dollar apocalypse -- a process that will expose the Greenback as a fraud. Already we're seeing portents of what America will look like as the unveiling continues.
Detroit, once the paradigm of America's industrial power, has become an economic moonscape. More than half the population lives below the poverty level; unemployment is nearing 29 percent, and grass is literally growing in the streets of some neighborhoods. Unburied bodies are accumulating in the county morgue because nobody has sufficient funds for interment or cremation.
A few days ago, tens of thousands of desperate Detroit residents besieged the Cobo Center in the hope of receiving housing assistance vouchers provided by the federal government. Within less than three minutes, 25,000 applications were filled out for 3,500 available vouchers.
Amid the scuffles, tramplings, death threats, and other incidental violence, a telling example of the self-replicating fraud of our monetary system could be seen. The Detroit News reports:
"After the applications ran out, some scam artists were selling photocopies of the originals for $20 each. They were doing a brisk business, even though the white original forms state clearly on the bottom: `Do not duplicate -- Must Submit Original Application.' Volunteers from the city of Detroit Planning and Development Department eventually handed out yellow photocopies themselves."
Coercion and redistribution: Detroit residents fill out welfare voucher applications on the hood of a police car.
Here we can see the terminally corrupt financial system in tragic microcosm.
The Feds, through the miracle of deficit spending financed through inflation, issue vouchers to substitute for the regime's worthless legal tender.
Some local scam artists exploit the desperation of the destitute by producing worthless counterfeits of the vouchers and charging for them.
Rather than punishing the criminals who created and sold those worthless documents -- call them voucher "derivatives" -- government officials simply make that scam official policy on the assumption that other people somewhere will absorb the costs. This is the same mechanism used to bail out the corporatist welfare whores of Wall Street, just on a much more limited scale. The biggest difference, of course, is that while most of the welfare applicants in Detroit were left with worthless applications, the welfare whores on Wall Street were spared such disappointment.
It's fiat "money" and criminal fraud all the way down. How far does "down" go? We're going to find out.
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Dum spiro, pugno!