Mad World by Gary Jules

Wednesday, March 31, 2010

The big picture...

This blog sucks for anybody with A.D.D. or no time on their hands. Some of the stories and video on here are long but worth it. If you haven't seen the blog lately go through several of the most recent post, some of the news I've gathered has been great. Thanks for visiting!

The RentenDollar: A conspiracy theory OR Please tell me where I’m wrong.

Posted By Larry Correia on his blog
"Monster Hunter Nation"

(The background history in the beginning of this article is kinda long but wait until you come to the conclusions near the end! I think Larry has a pretty clear view.)

Late last night I came up with my very own conspiracy theory. It seemed a little odd at the time, but as I’ve continued to think it over, I’ve not yet been able to poke any significant holes in it. Of course, it is the kind of thing that an accountant turned science fiction author would come up with.

Basically, I’m starting to think that certain factions within our government actively want hyperinflation to occur as a surefire method of instituting de-facto communism in America…

Crazy, right? I know, you’re thinking that surely Correia has gone off the deep end and spouting off all sorts of doomsday nonsense, but hear me out first.

As many of you know, I’m a history geek. Last year I wrote my first alternative history novel set in 1932. Because I’m a stickler for authenticity, I did an absurd amount of research. I read every book I could get my hands on about what is normally called the interwar period. I mostly concentrated on American history/culture but I also learned a bit about the Weimar Republic.

The interesting factoids about the Weimar Republic that most of us remember is that it was the home of hyperinflation (remember the wheelbarrow full of money to buy a loaf of bread) and eventually it also gave us one of history’s greatest scumbags, Hitler. Other than that, most Americans don’t really know much about the Weimar Republic.

Okay, but where did the hyperinflation come from? I’m going to greatly simplify this because A. I’m a writer and accountant, not a historian, go to Wikipedia and B. This is only for a background to draw a comparison to what we’re doing right now.

The Weimar Republic (If I recall correctly, they actually called themselves the Deutsch Reich) came about after WWI. The German Empire had fallen apart, leadership fled, and for the next couple of years there were several battles fought between different factions of communists, socialists, and conservatives. (and when I say conservative it isn’t what it means here and now. I mean conservative back toward the empire, royalty, and all that entails). These were not polite political discussions. These were a series of violent mini-revolts where various cities would go off and declare themselves independent, like the Soviet State of Munich. Then a bunch of communists and the “Freikorps” would clash in the streets, then repeat a week later in a different city. It was bad.

Eventually the Weimar Republic was formed from the different groups, and immediately it had a whole new set of problems. The Germans signed the treaty of Versailles, they gave up a bunch of territory, and even worse, then took on a massive war debt and an agreement to basically pay the allies for the biggest war in history.

So what does a government, which is already sitting on a very damaged economy, do in order to pay this debt? They printed more money. Sounding familiar yet?

It got worse. As the Weimar printed more money, their government got more bloated, and ate up even more of their resources. (at one point a chancellor laid off several hundred thousand government employees to try and make ends meet). As their money inflated and became more useless, France got tired of not getting paid, and being jerks, invaded and took over the Ruhr, which was one of the most productive regions in Germany. This caused a drop in production, and then everybody else went on strike.

Meanwhile, the money kept inflating to levels that people couldn’t even understand. Back during the war, the Mark was something like 4 to 1 against the dollar. By the time they hit hyperinflation, they’d gone to millions to 1, and by the end, it was literally trillions to a single dollar. They would print new bills, and a few days later all they were good for was note paper. This is where the stories about the wheelbarrow full of money for bread comes from. To put this in perspective, this would be like you filling the trunk of your car with twenty dollar bills and then using all those trash bags full of money to buy some shoelaces and a tube of toothpaste.

So basically Germany was totally screwed.

So how did they get out of it? Contrary to what most Americans think, it wasn’t Hitler that came along and fixed Germany’s economic problems and turned them into an industrial powerhouse war machine through the sheer power of him being a complete ass. There was actually a time period in the thirties that the Weimer knew as the Golden Years, because they’d finally gotten much of their economy back under control.

They rebooted their currency. If I recall correctly, their new currency was called the Rentenmark. They introduced the Rentenmark, and you could trade in your trillions of crappy marks for one of them. It went back to 4-1 with the dollar. Now here’s the thing. You can’t just change the name and have new currency. Your currency has to actually be based on something. (kind of like how the dollar is based on good feelings and rainbows).

They based it on land. It was the one asset that the government could go and take over to use as a base asset, and land is always valuable because they aren’t making any more of it. Congratulations land owners, all your dirt belongs to us, but people were so desperate (and tired of carrying buckets of silly money around) that it didn’t matter. They were desperate, and desperate times called for desperate (and sometimes stupid) measures. Using the new asset-backed Rentenmarks, Germany was able to start paying their debts again and get on with a semblance of normalcy, well at least until they elected a bunch of lunatics in snazzy uniforms.

So why this long story? Because it is to compare with what we’re doing ourselves. Right now the United States is on the path to hyperinflation. CBO is predicting that by 2020, our debt will be 90% of our GDP. (EDIT: As was pointed out in the comments, my information there was wrong. We’ll hit 90% way way earlier than that, so it is even worse) Think about that for a second. That would be like if you had a $50,000 a year job, but you owed vicious thumb-breaking loan sharks $45,000 that was still collecting interest. Our entitlements are bankrupting us. Even before Health Control (because if you believe the government is going to spend a trillion bucks and cut the deficit, you must sleep in a helmet) we’re only a few years from all our tax dollars only being able to pay for Medicare, Social Security, and interest on our debt. That’s it.

Now, what happens when you as an individual can’t pay your debts or pay your bills on time? Your credit rating goes down. And when your credit rating goes down, you can no longer get that low interest Visa-Black-Platinum-Playboy card (with Sky Miles!) you can now only get the Soup-Kitchen-Discover card at 280% interest. Many people don’t realize it, but governments have credit ratings too. Right now we’ve got a great one, based on ‘because we’re so awesome’. But we’re getting really close to losing our good credit rating, (because awesome will only get you so far before you actually have to pay the bills) when that happens, all of those already really bad estimates about our future debt are going to get far worse. How much worse? Have you ever played Fallout 3 on the Xbox? Kind of like that.

So while we’re on our way to Thunder Dome, the government is printing dollars like crazy, faster than ever before, with no signs of letting up. Inflation is coming. When the credit rating tanks and the entitlements get worse (or the oil currency switches to something else) hello, Master Blaster! We’re in deep trouble. We’re looking at hyperinflation. Dollars worth nothing, burning them to keep warm would be more efficient, kind of thing.

Yet the government, that surely has some smart people in it, continues to increase our spending, increase our debt load, and do things that are the exact opposite of fiscally responsible. It is almost as if they want the system to collapse…

Then I remember the Weimar Republic. They had hyperinflation. How did they get out of it? By rebooting the currency. What was the new currency based on? Land. Land is an asset.

The government is gobbling up land out west like crazy. Every time we discover a deposit of oil or coal out here, the government immediately discovers a snail or a flower on it that might be endangered and grabs a couple hundred thousand more acres. The government is trying to kick 18,000 people out of their homes in Colorado to put in a new “tank range”.

But that wouldn’t be enough. Think beyond land. Think assets.

Fanny May and Freddy Mac now hold something like 50% of the mortgages in the US. The government has recently either directly taken over, or regulated the living crap out of our auto industry, insurance industry, banking and finance industry, and now health care…

The people of the Weimar were so desperate, that they would do anything to get out of their economic crisis.

Let’s imagine a hypothetical situation here. Let’s say that in a decade or so, our currency has collapsed. We owe far more than we produce. Companies are failing. Because all of our tax dollars are used just to pay for our debt, taxes have to be raised, which causes even more unemployment and decreased production. Entitlements can’t be met. The current economic crisis looks awesome in comparison, but there is no possible way out, because our money is now worthless.

So… Reboot the currency. Make a new RentenDollar.

The media can even point out what a fantastic idea this is because historically, it has worked before! The politicians will tell us that this is the only way and we must act quickly! People are desperate and will be told that “the private system has failed! Only government intervention can save us now!” (gee, why does that sound soooo familiar?)

Sure, they caused the problem, but that isn’t what most people will think, but as they’ve shown, they don’t really care what we think anyway. They will not let a good crisis go to waste. There is only one teensy downside to this reboot though…

See, the RentenDollar can’t be based on good feelings like the old dollar, it must be based on ASSETS. And since the capitalist system has failed, and the government has already got its fingers in all these various companies, instead of just regulating these companies, why shouldn’t the government just own them?

All those mortgages? They now belong to the government. Banks? Belong to the government. Industrial production? Government. Medical. Government. They’re assets, and they’re necessary to back our new currency.

You don’t like it? People are starving. There are riots in the streets. Cities are burning. We have to act now! Won’t somebody think of the children! There’s no time to read this 9,000 page bill! HURRY!

…And just like that, America has become a communist country. State control and ownership of everything.

So, let’s poke some holes in my late night theory. Please, somebody tell me how this is impossible. Maybe we’re not heading for an economic collapse. Maybe we’re not going to have hyperinflation. If anybody has any evidence of that, I’d love to hear it, because this is kind of depressing.

Or, the other way that this idea could be silly and implausible is if there was no possible way that elements within our government would want to exercise total control over our lives… Yeah… that’s just absurd.

Ask yourself this one question. Do you believe that our current federal government, if presented with the opportunity, would take over and control everything? Yes or No.

Help me out here, guys. I’m not getting any warm feelings from this.

"A society whose citizens refuse to see and investigate the facts, who refuse to believe that their government and their media will routinely lie to them and fabricate a reality contrary to verifiable facts, is a society that chooses and deserves the Police State Dictatorship it's going to get." -- Ian Williams Goddard

Lastly I recently read a pamplet put out by the State Department in 1961, publication #7277, it's called "Freedom From War: The United States Program for General and Complete Disarmament in a Peaceful World". This publication is current policy and has not been repealed. This publication outlines three stages to total disarmament of the United States and the rest of the world. It then talks about setting up the U.N. as the worlds only army and police force to govern all nations.

Can you see what I see?

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