Upon The Next Crisis, The Rules Will Suddenly Change

...For the benefit of the elites; not the rest of us...

We can add a third certainty to the two standard ones (death and taxes): The rules will suddenly change when a financial crisis strikes.

Why is this a certainty? The answer is complex, as it draws on human nature, politics and the structure of societies/economies ruled by centralized states (governments).

The Core Imperative of the State: Expand Control

As I explain in my book, Resistance, Revolution, Liberation, the core (i.e. ontological) imperative of every central state is to expand its reach and control.  This isn’t just the result of individuals within the state seeking more power; every centralized state views whatever is outside its control as a threat.  The way to reduce or neutralize a threat is to take control of the mechanisms that generated it.

Once the state has gained control of these mechanisms, it is loath to relinquish them; to relinquish control is to invite chaos.

There is of course an intensely self-serving dynamic to extending state control: those being paid to enforce this state control have an immense vested interest in the state retaining (or even extending) this control, as their livelihoods now depend on the state doing so.

The higher-ups in the state also have a vested interest in retaining these new controls, as more control means more wealth and power accrue to those at the top of the centralized power pyramid: this extension of state control means private enterprise must now lobby the state for favors, and it gives the higher-ups more perquisites and favors to dispense—for a price, of course.

This vested interest arises throughout the power pyramid, from the bottom functionary with newfound power over common citizens to the managers of the departmental bureaucracy tasked with enforcing the new control to the apex of state authority.

This hierarchy of state power creates another threat to the central state; the corralling of state power by fiefdoms within the state itself.  In other words, fiefdoms can become semi-autonomous agencies that are only nominally under the control of central authority.  The answer is of course additional layers of oversight, compliance, investigation and enforcement within the state itself.

The State Serves Elites First and Foremost

Though modern states always claim to serve the common citizenry, in reality the state serves the wealth/power elites who need state complicity to maintain their wealth/power.  These power elites function as the modern-day equivalent of aristocracy: everyone is equal, but some or more equal than others, to use Orwell’s timeless phrase.

This reality leads to a non-formalized two-tier system: one for commoners and one for the power elite/New Aristocracy.  A formalized two-tier system would incite political disorder, so the system is nominally “everyone is equal under the law” but in practice there are two tiers.

Tax collection is a good example. The corporate/financier power elite have access to complex tax avoidance schemes that are unavailable to commoners, who have few tax reduction tools.  The judicial system is another: power elites can play the system via high-cost attorneys while commoners are left to plea-bargain a reduced sentence, even when they are innocent.

When crises arise, the state first protects its own authority and control. Its second priority is securing the wealth and power of the elite.

The Self-Serving Savior State

Human nature being what it is, there are two motivations for state authorities to expand their reach and control.  Some of those with state authority feel it is their prerogative (or even their responsibility) to expand state control to protect the commoners who are likely to suffer should a crisis erupt. This do-good impulse may be genuine in some, but by and large it is not compassion that dominates decision-making but the dynamic of a central state having so much power in the first place: you have the power, so do something to save us from the consequences of crisis.

In other words, once power is concentrated in the hands of a few, those few are responsible for handling crises that would have otherwise fallen on a decentralized system with many levels of response.

Then there is the Machiavellian impulse to use crisis as the cover for a power-grab, a dynamic encapsulated in the phrase, never let a good crisis go to waste. This dynamic doesn’t have to be passive; power elites don’t have to wait for a crisis, they can engineer one by exploiting their control of state and private-sector mechanisms.  This process of engineering a crisis can be policy-driven (as described in Naomi Klein’s book The Shock Doctrine) or propaganda-driven (the sinking of the battleship Maine, Nazi Germany’s Lebensraum, etc.).

Though many call an expansive state The Nanny State, I prefer the term The Savior State, as the state claims its expanding powers under the guise of saving us from a variety of threats—including those that arise from the socio-economic system the state oversees. In other words, The Savior State’s guiding ideology is to save us from ourselves.

If we might harm ourselves with addictive drugs, the state’s solution is to imprison everyone caught with addictive drugs—except of course those addictive drugs that enrich the Power Elites (nicotine, alcohol, synthetic opioids, etc.).

If the state deems it risky for children under the age of ten to play outside unattended, the state’s solution is to treat the parents/guardians as criminals.

Each extension of control creates new layers of vested interests—more functionaries who gain not from solving problems but insuring they fester into the future as a form of guaranteed employment, and more opportunities to dispense favors in the informal two-tier system of powerless commoners and influential elites.

The Crisis Toolbox: Political Expediency

History teaches us that authorities view crises as first and foremost a threat to state authority, secondarily as a threat to elites’ wealth and power, and then lastly as a threat to the socio-economic system they rule.

Given these crisis management priorities, their first response is to extend their authority by whatever means are necessary.  Once these new powers are in hand, the state deploys them to limit the threat posed to the power elites and the structure that supports state and elite wealth/power.

In a centralized power structure, this crisis management manifests as change the rules without warning to increase the reach and power of the state.  The justification is something along the lines of these emergency powers are needed to protect the nation—powers that all too often become permanent, as powers once taken are rarely relinquished for all the reasons outlined above.

While the rule changes are presented as both necessary and well-planned, in actuality the process is one of political expediency:  a hurried rush to do whatever limits the risks to the power elites’ wealth and power before opposition can be organized, and to cloak the power-grab in the usual Savior State garb: we are acting to save the system that benefits you.

But this expediency comes back to haunt both the state and the power elites, as expedient power grabs designed to protect the state and elites do not actually address the dynamics that spawned the crisis in the first place. Rather, they exacerbate the problem by introducing self-serving fixes that paper over the problem as a quick-and-dirty way of protecting the power and wealth of the state and private-sector elites.

These fixes end up crippling the mechanisms that are needed to actually solve the systemic sources of the crisis.

The Continuing Financial Crisis

Financial crises are inevitable, and the state (which includes the central bank) seeks to limit the crisis by taking control of the market. 

Examples include: closing the stock market, declaring a bank holiday, issuing a new currency, fixing wages and prices, and banning short selling.

In the current financial crisis that started in 2008 (and that has yet to end), central banks and states have largely avoided these outright takeovers of the market in favor of a more subtle strategy of controlling the markets while maintaining the appearance of “free markets.”

In Part 2: How To Defend Against An Unfair Re-Set Of The System, we’ll examine the ways the U.S. state and central bank have already extended control over the market—for example, via the mass purchase of assets by central banks (see accompanying chart)-- and what additional controls they will likely impose as the simmering crisis erupts anew in the years ahead.

We’ll also look at what we mere commoners can do to protect ourselves from the inevitable risks and unanticipated calamities this centralized control will unleash.

Click here to read the report (free executive summary, enrollment required for full access)

Against The Tyranny Of The So-Called Experts

Submitted by Kurt Schlichter via Townhall.com,

America’s elite – that collection of puffed up mediocrities who until recently held the undisputed command of the heights of our politics and culture – is in crisis. Its unbroken track record of failure has finally stirred the rest of America from its coma. The normals are now hella woke, and the elitists are being hella rejected. Unused to accountability, the elite is in a tizzy over the way people are not only blaming it for its myriad failures but are taking concrete steps to restrict its power. It’s not just electing Donald Trump. It’s ignoring the media, ignoring Hollywood stars, and ignoring the cabal of “experts” who presume to tell us how to live.

And it’s about time.

The best thing about being a member of the elite is that you really don’t have to do anything to become one. You can be born one – no matter how dumb or drug-addled you are, if you’re a Kennedy you’re elite regardless of how many times you blow the bar exam. Or you can become one by getting into the right school – remember, a Harvard degree does not mean you did well at Harvard. Everyone at Harvard does well – an “A” is a participation trophy. It’s getting in that matters, and getting in depends, in significant part, on who you are. Elite mom and dad, welcome to the Ivy League.

The elites, having been called out for their failure, are now trying to rebrand themselves as “experts.” It’s important to distinguish “elites” from “experts.” Elites want to be seen as experts because an expert is assumed to actually know something and to have some sort of technical skill. To be elite, you just have to be accepted as elite. That’s why elitists fudge the terms; they want the credibility of being experts without actually having to do what a real expert does.

Take, for example, the notorious New Yorker cartoon of the passenger on the plane electing himself pilot. The point, which the elitists think is brilliant, is that the running of government should be left to the experts without the participation of you people. Of course, pilots are trained in detailed technical skills and, critically, are accountable for their performance. If they fail, they get fired – or worse. [Insert Kennedy pilot joke here] If an elitist fails at an important job, she gets nominated for president. See the difference?

The point they want to make is that we should submit to their “expert” (really, elite) guidance, since we are unfit to determine our own destiny. Yet, when piloting this country over the last couple decades, these elites have flown the plane straight into the ground. Real experts are held accountable, but elites never are. Their landing is always soft – it’s never the elites who suffer while the normal prosper, only the other way around. The elitists always win – that’s why they are called “elite.”

Remember, whenever anyone tells you to blindly give up your input and rely on an “expert,” you stand a good chance of being scammed. Take a doctor. Doctors have a hard skill. They go through a lot of training. And medical malpractice kills about 98,000 people per year. Doctors are experts, but they are not perfect. No expert is. Nor are they perfectly disinterested technicians. A lot of doctors are terrible people – the worst divorces lawyers deal with are doctor divorces. Don’t confuse expertise with morality.

Like all humans, experts are self-interested. That’s why some doctors complain when their patients read up on their symptoms in Google. “Gosh, these peons are presuming to gain access to my secret knowledge – how dare they!” Yes – thanks to technology, much of what doctors do (which is maintain and use knowledge – many never touch a scalpel) can be done by normals on line. You have a symptom and you go to Web MD and often it answers your question – “Eww, that weird lump is a sebaceous cyst, not melanoma.”

The same with lawyers – go to LegalZoom to create your routine limited liability company and you’ll do it for a third of the price of the lawyer who merely changes the names on the last routine limited liability company formation documents he prepared. Trying a case is different – you probably want a technical expert who has done it before. But a lot of legal knowledge is not only accessible but employable by regular citizens; the laws restricting the practice of law to those with a license may protect some people from harm, but it also ensures we lawyers can restrict supply and thus justify our outrageous fees. Remember, a lot of “expertise” is not skill derived from experience but merely access to information. And when everyone has that access, well, the guilds get really protective of their turf.

The expert technocracy model of governance also depends on the underlying assumption of a disinterested, objective technician class that will protect others’ interests before its own. But the notion that a particular expert is disinterested and somehow only concerned with objective facts is simply silly. As a trial lawyer, I absolutely know the other side is always going to hire some “expert” to say exactly what needs to be said to help its case. We litigators regularly refer to experts as “whores” – it’s just assumed. Now, smart lawyers try to get honest experts – I’d much prefer to hear early that my client’s case has problems. But there are surprisingly few smart lawyers – again, simply because you are in an expert caste does not mean you are not a half-wit.

The simple fact is that when people push for government by expert, the experts they want running things will always – every single time – happen to have exactly the same policy preferences as the people pushing them. “Leave climate science to the experts!” Yeah, and in a shocking turn of events, the experts we are supposed to defer to feel the solution to climate change is to give more money and power to the people demanding “Leave climate science to the experts!”

And then there’s the problem of incompetent experts. This is especially true in the media, where the internet has made the journalistic gatekeeper model obsolete. These hacks are panicking, and trying to claw back their authority by labeling dissent “fake news” – that is, when they aren’t themselves publishing outright lies and propaganda they imagine we’ll buy into. Talk about, as Peggy Noonan aptly put it, being patronized by our inferiors.

You would think that if you presumed to tell the rest of us what to think that you might first ensure that you actually know stuff. But then, being elite means never having to actually accomplish anything, like knowing stuff. For example, Judd Legum, a senior apparatchik at ThinkProgress.org – the popular leftist political site best known for stuffing two questionable assertions into one web address – went on with Hugh Hewitt, who asked him a series of pretty basic questions about government and foreign policy. Well, it was pretty ugly. What he didn’t know was … extensive. I’d liken the segment to the Bataan Death March but Judd would probably not get the reference. He’ll have to check Wikipedia, just like everyone else. But then, if everyone else can do what Judd does, why do we need him and his ilk?

Experts aren’t what they used to be – that is, experts. “Experts” tell us that by an act of sheer desire, Dave can transform into Diane. That’s crazy. We try to outsource our moral judgment to “ethics experts” and end up with nutballs telling us infanticide is cool. The experts told us how there was an ice age coming. Then acid rain. Then ozone depletion. Then global warming. Then, when it didn’t actually get warmer, global climate change. Yet, somehow we are expected not to notice this litany of wrong and to just submit to the guidance of people who are literally never right.

Sure, if I had a brain tumor, I’d want a skilled neurosurgeon to take it out – though note how Dr. Ben Carson’s demonstrated track record of competence at that hard skill has earned him zero respect from the left, demonstrating that their alleged regard for expertise is simply another scam. But while I would rely on my doc for the technical work of cutting and slicing, his expertise does not apply to the other key issues involved – like whether I want to accept the consequences of the surgery on my quality of life. Questions that relate to our preferences and morals are not the province of experts. Nor should decisions regarding the principles and policies of our government be delegated to the technical experts charged with carrying them out.

We are American citizens. We can decide for ourselves what kind of nation we want to live in. That’s our decision. Experts? Well, you can provide advice, and then you can carry out our instructions. But don’t presume to do any more than that. You work for us, not vice versa.