We live in two different Americas, argues Charles Hugh Smith in today’s reckoning. Which one do you live in?
It’s easy to lay America’s visible frustrations at the feet of Covid lockdowns or political polarization, but this conveniently ignores the real driver: systemic unfairness.
The status quo has been increasingly rigged to benefit insiders and elites as the powers of central banks and governments have picked the winners (cronies, insiders, cartels and monopolies) and shifted the losses and risks onto the losers (the rest of us).
We now live in the world the 19th-century French economist Frédéric Bastiat so aptly described:
“When plunder becomes a way of life for a group of men in a society, over the course of time they create for themselves a legal system that authorizes it and a moral code that glorifies it.”
Ours is a two-tier society and economy with a broken ladder of social mobility for those trying to reach the security of the technocrat class.
As Bastiat observed, those rigging the system to benefit themselves always create a legal system that lets them off scot-free and a PR scheme that glorifies their predation as well-deserved rewards from their enormous appetite for hard work and innovation.
Embezzling a couple billion dollars also earns you a get out of jail free card: none of the perps in Wall Street’s skims, scams and frauds ever gets indicted, much less convicted, and none of Wall Street’s legalized looters ever goes to prison.
And this is a fair and just system? Uh, right.
The Roulette Wheel Is Rigged
Meanwhile, the reality is the roulette wheel is rigged, and only chumps believe it’s a fair game. Those who know it’s rigged have essentially zero agency (control/power) or capital to demand an unrigged game or finagle their way into the elite class doing the skimming.
The net result is soaring frustration with a patently unfair system that’s touted as the fairest in the entire world.
The key takeaway, in my view, is that the unfairness isn’t limited to the economy, society or politics — it’s manifesting in all three realms. It isn’t just frustration with domestic issues — the global economic order is also a source of unfairness and powerlessness.
These are the dynamics that are tearing apart our social cohesion and that will soon start destabilizing the economy — regardless of how much “money” the Federal Reserve prints.
How divided is America?
There is a map, courtesy of the Brookings Institute, showing the roughly 500 counties Biden won and the roughly 2,500 counties Trump won.
This might seem like a chart of political polarization, and superficially that’s clear, but the real polarization is economic-financial: there are two economies in America, and there’s very little commonality in the two economies.
70% of America’s economy is generated in fewer than 500 counties; the other 2,500 [ … ]