Jeff Berwick: Day of the Dead State

Jeff Berwick

Day of the Dead State

Jeff Berwick, 19 January 2012

The most surprising thing about the recent downgrading of nine Eurozone countries by S&P is that anyone is surprised to hear that the government debt of any of these countries is risky!

From the Financial Times:

The eurozone debt crisis returned with a vengeance on Friday as Standard & Poor’s, the credit rating agency, downgraded France and Austria – two of the currency zone’s six triple A rated countries – as well as seven nations not in that top tier, among them Italy and Spain.

S&P, under political fire since it announced a review or eurozone debt in December, gave 14 of 16 countries – including France, Italy and Spain – a negative outlook, which it said meant a one-in-three chance for each country of a further downgrade this year or next.

It seems as though it is only a matter of time before they each fall to bankruptcy, no matter how many bailouts they can muster. It’s almost enough to make us change our logo. But, we’ve always said the euro would fall before the US dollar. The dollar will be the last in what will be a crescendo of currency collapse.

What the students of the Austrian School (aka real economics) have understood since the turn of the 20th century was that this was the inevitable result of the pursuit of the socialist utopia where humans would not have a worry in the world, cared for from cradle to grave by the all knowing state.

The modern Welfare/Warfare state was born in the in late nineteenth-century Imperial Germany under Chancellor Otto von Bismarck – his intention was clear from the outset:

“My idea was to bribe the working classes, or shall I say, to win them over, to regard the state as a social institution existing for their sake and interested in their welfare”

Bet you never saw that quote in your government run schoolbooks. Frideric Howe, an admirer of the german systeml wrote that under that system, “The individual exists for the state, not the state for the individual.”

We are now witnessing the end result of the institutions of bribery and theft that swept the rest of the world in the first half of the 20th century.

Read full article.

Phi Beta Iota:  Where the libertarians and the advanced cybernetics, collective intelligence, and systems theory people come together is in the recognition that “management” or “command and control” do not scale.  Bottom up agility that can only be achived by having the greatest intelligence “on the edges” is the only means of achieving resilience in complex systems.  Those of us who saw the death of the state in 1970’s (Richard Falk a leading light) made the cardinal mistake of thinking that something BIGGER was needed–world government.  Now we recognize that we must reverse a century of increasingly corrupt centralization of power; that the preconditions of revolution are created by the overconcentration of power, wealth, corruption, and evil.

1975 MA Paper: The origin, status, and failure of the state as the sovereign mode of human organization

1976 Thesis: Theory, Risk Assessment, and Internal War: A Framework for the Observation of Revolutionary Potential

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