Thursday, June 13, 2024
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Biden’s US faces economic and geopolitical collapse


THE corrupt and incoherent President Biden is a permanent insult to democracy and the world which has to engage with him. As a result his country is in what could be a terminal state of economic and geopolitical decline and potentially engaged in three or four destructive wars (against Russia, China, Iran and, through Israel, with worldwide Islamism). There is even a direct connection between the latter and the US southern border crisis as Islamic enemies infiltrate the US. Here the authorities warn who to look out for:

As with all governments which fail and destroy the wealth-creating, market-constrained private sector from which they glean their tax revenues, the US Government resorts to state-created non-jobs – plus in the case of the US the ‘non-consumable’ products of the extremely expensive military sector.

The perennial lie of the political class is that state spending is ‘public spending’ whereas the only meaningful public spending is the spending by the public in the private sector. The public’s spending on the ‘products’ of the state is controlled and demanded by the state. Only in the private sector are the producers effectively controlled by the public (who can stop spending until prices fall or switch to alternative suppliers) although in the increasingly corporate statist economy, where privileged largely non-taxpaying big corporations rule, the state increasingly combines with corporations to frustrate the public.

The decline of the US economy is now to be seen in the private sector as the state piles on state-funded and protected jobs. The September employment figures show the process: 

As a result the American consumer is struggling, as shown by these record defaults on car payments. There are more than 305million cars in the USA at 900 per 1,000 population. 

The US is now adding debt at an exponential rate. It racked up its first $10trillion in debt over the course of 232 years. Following the Great Financial Crisis, it added another $10trillion in nine years. The next $10trillion took four years. The US has added $2trillion in debt in the last four months and the national debt is now approaching $34trillion which would be 130 per cent of projected GDP for 2023 (roughly the same as basket-case Italy). And Biden keeps on borrowing and spending – proposing another $100billion on Ukraine, Israel, Taiwan and America’s greatest internal crisis, the mass invasion across its southern border.

The need to rein in the grotesque inflationary money printing of the Covid years, the costs of the Ukraine fiasco, the billions spent on the fatuous ‘Inflation Reduction Act’ and the beginning of the vote-buying period in the run-up to the 2024 Presidential election has meant 11 interest rate rises since March 2022. The dangerous result of suddenly discovering prudence inevitably means an overreaction and now money supply has suffered its biggest contraction ever.

As a result bankruptcies have risen steeply to levels not seen (with the exception of the Covid lockdowns) since the great financial crisis of 2008-2009:

So having spent like a drunken banker as growth returned, the US has record debts just as it descends into recession and commits spending to more wars – the worst possible combination.

While accusing Iran of funding terrorist groups throughout the Middle East (including Hamas in Gaza) the US recently released $6billion of Iranian funds frozen in Western banks since sanctions were applied in 2018. In return Iranian prisoners were released to the West. In 2016 President Obama gave $400million to Iran to halt nuclear weapon development. No doubt these vast sums will have been used to fund the enemies of Israel and the US in the Middle East.

In addition we know from images of Hamas’s newly acquired weaponry that US armaments supplied to Ukraine have found their way to the Middle East. Only in the last few weeks have US legislators set up some perfunctory checks on money and weapons supplies to Ukraine. And Biden would not have done that without Republican demands.

The simplistic view of the world from Washington DC, and hence the dangerous naivety of US foreign policy, is reflected in the inability of most Americans to find Ukraine on a map and the inability of even the CNN network to locate cities in Israel.

So the world sees US internal bankruptcy, international ignorance, disastrous leadership and the rapid decline of the US dollar as the chief reserve currency. 

No wonder, when the US accounts for 42 per cent of the entire world’s budget deficits even though it accounts for only 25 per cent of the world’s total GDP.

The combination of economic collapse, financial mismanagement on a gargantuan scale, collapsing faith in the dollar and an invasion by declared enemies on the southern border while pursuing geopolitical domination through expensive wars, all with the weakest political leadership in the history of the US, is a disaster for the West and a source of massive instability for the rest of the world.

Just as Israel is beset by war on six fronts (Hamas in Gaza, Houthi in Yemen, Iran, Syria, Hezbollah in Lebanon, Arab West Bank) so the US is fighting multiple wars brought on by its imperial overreach and, in Ukraine, demonstrating its weakness to its enemies.

Dangerous times need wise leaders ‘speaking softly but carrying a big stick’ (Theodore Roosevelt) not an American political class squeaking aggression everywhere but in what looks like terminal economic and geopolitical decline.

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Rodney Atkinson
Rodney Atkinson
Rodney Atkinson is an entrepreneur and political economist who is the author of some 500 articles and policy papers. His Freenations website is 23 years old. Rodney Atkinson's books are available on Amazon .

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