Crisis as a Means to Building a Global Totalitarian State

As the world financial and economic crisis comes into its own, the Western political leaders and elites are seeking to impress on mankind the idea that this upheaval will end up ‘turning the world into something different’.

Even though the picture of the 'new world order’ remains vague and fuzzy, the main idea is quite clear: A single global government, goes the argument, has to be established if we don’t want general chaos to prevail.

Every now and again, Western politicians mention the need for a ‘new world order’, a ‘new world financial architecture’, or some kind of ‘supranational control’, calling it a ‘New Deal’ for the world. Nicolas Sarkozy was the first to say so, while addressing the UN General Assembly in September 2007 (that is, before the crisis).

During the February 2009 meeting in Berlin convened to prepare the G20 summit, this was echoed by Gordon Brown, who said that a worldwide New Deal was needed. We are conscious, he added, that where the world financial flows were concerned, we would not be able to emerge from this situation with the help of purely national authorities alone. We need the authorities and world watchdogs to make the activities of financial institutions operating in the world markets totally open to us. Both Sarkozy and Brown are protégés of the Rothschilds. Statements made by certain representatives of ‘the global elite’ indicate that the current crisis is being used as a mechanism for provoking some deepening social upheavals that would make mankind – plunged as it is already into chaos and frightened by the ghost of an all-out violence – urge of its own free will that a ‘supranational’ arbitrator with dictatorial powers intervene into the world affairs.

The events are following the same path as the Great Depression in 1929-1933: a financial crisis, an economic recession, social conflicts, establishing totalitarian dictatorships, inciting a war to concentrate power, and capital in the hands of a narrow circle. This time, however, the case in point is the final stage in the ‘global control’ strategy, where a decisive blow should be dealt to the national state sovereignty institution, followed by a transition to a system of private power of transnational elites.

As early as the late 1990s, David Rockefeller, author of the idea of private power that is due to replace the governments, said that we (the world) were on the threshold of global changes. All we need, he went on, is some large-scale crisis that will make people accept the new world order.

Jacques Attali, Sarkozy’s adviser and former EBRD chief, claimed that the elites had been incapable of dealing with the currency problems of the 1930s. He was afraid, he said, that a similar mistake would be made again. At first we’ll wage wars, he went on, and let 300 million people perish. After that reforms will follow and a world government. Shouldn’t we better think about a world government already at this stage, he asked?

The same was stated by Henry Kissinger: "In the final analysis, the main task is to define and formulate the general concerns of the majority of countries, as well as of all leading states with regard to the economic crisis, considering the collective fear of a terrorist jihad. Next, all of that should be converted to a common action strategy… Thus, America and its potential partners are getting a unique chance for turning the moment of the crisis into a vision of hope."

The world is being led to accept the “new order” idea step by step to avoid provoking events that are likely to make the universal protests against the worsening conditions of human existence take ‘a wrong course’ and become uncontrolled. The main thing that Stage One managed to achieve was to start a wide-ranging discussion on ‘global government’ and the ‘inadmissibility of protectionism’ with an emphasis on the ‘hopelessness’ of the national-state models for emerging from the crisis.

This discussion is proceeding against the background of information pressures that help to build up human anxieties, fear, and uncertainty. Some of those information actions are the following: WTO forecasts to the effect that 1.4 billion people are likely to sink below the poverty line in 2009; a warning by the WTO director general that the biggest world trade slide in postwar history is in the offing; a statement by the IMF’s Dominique Strauss-Kohn (a protégé of Sarkozy’s) that a world economic crash is impending unless a large-scale reform of the financial sector of the world economy is implemented, and a crash that is most likely to bring in its wake not only social unrest but also a war.

Against this background, the idea to introduce a common world currency as a cornerstone of the ‘new world order’ was put forward. The real masterminds of this long-standing project are as yet in the shadow. Let us note that some or other representatives of Russia are pushed to the fore. This is reminiscent of the situation before World War I, where the Anglo-French circles that possessed some well-elaborated plans for a new division of the world instructed the Russian Foreign Minister to draw up a general program for the Entente Cordiale. It went down in history as the ‘Sazonov program’, even though Russia did not play an independent role in that war and was from the start built into the system of interests of the British financial elite.

On March 19, Henry Kissinger came to Moscow as a member of The Wise Men (James Baker, George Schultz, and others), who had meetings with the Russian leaders before the G20 summit. Dmitry Trenin, director of the Moscow Carnegie Center and participant in the latest US meeting of the Bilderbergers, called that meeting a ‘positive signal’. On March 25, Moskovsky Komsomolets published an article ‘The Crisis and the World Problems’, by Gavriil Popov (currently President of the International Union of Economists) that openly voiced what was normally discussed behind closed doors.

The article mentioned World Parliament, World Government, World Armed Forces, World Police Force, World Bank, the necessity of placing under international control the nuclear weapons, nuclear power generating capacities, the entire amount of space rocket technology, and the planet’s minerals, the imposition of birth-rate limits, the cleansing of humanity’s gene pool, the fostering of people intolerant to cultural and religious incompatibility, and the like.

The “countries that will not accept the global prospects,” says Popov, “must be expelled from the world community.”

Of course, the Moskovsky Komsomolets article conveys nothing new that would enable one to understand the strategy of the global elite. Another thing is important. The establishment of a totalitarian police order and the elimination of national states is being suggested as an open program of action, and what both the liberals, and the socialists, and the conservatives always viewed as ‘new fascism’ is being recommended as the only possible salutary path for the whole of mankind. Someone wants the discussing of these projects to become a norm. In this context, some ‘particularly trusted’ representatives of Russia are pushed to the fore, Russia that will become the main victim of the policy of total plunder should the ‘global government’ become a reality.

The G20 did not discuss the common world currency issue, since time had not yet come for that. The summit itself was a step forward on the way to chaos, because its decisions, if followed blindly, will only worsen the world socioeconomic situation and, to quote Lyndon LaRouche, will “finish off the patient.”

In the meantime, the crisis is being exacerbated, and analysts are predicting an era of mass-scale unemployment. The most pessimistic predictions come from LEAP/Europe 20201, which regularly publishes them in its bulletins and even set them out in an open letter sent to the leaders of the Twenty before the London summit.

As early as February 2006, LEAP was surprisingly precise in describing the prospects for the ‘systemic global crisis’ as a consequence of the financial illness caused by the US debt. LEAP analysts are viewing the current events in the context of the general crisis that began in the late 1970s and is now in its fourth, final and most grave stage, the so-called ‘elutriation phase’, where the collapse of real economy begins. According to LEAP’s Frank Biancheri, it is not simply a recession but the end of the system, in which its main pillar, the US economy, collapsed. “We are witnessing the end of an entire epoch before our own eyes.”

The crisis may lead to some most difficult consequences. LEAP forecasts a rise in unemployment to 15-20% in Europe and as much as 30% in the United States. If the key dollar problem fails to be solved, the world events will take a most dramatic turn. The dollar collapse may take place as early as July 2009, and the potentially decades-long crisis will trigger off “a world-wide geopolitical disintegration” with social upheavals and civil conflicts, with the division of the world into separate blocs, with the world coming back to Europe’s1914, with military clashes, etc. The most powerful popular unrest will take place in countries with the least developed social security systems and the biggest concentrations of weapons, primarily in Latin America and the United States, where social violence is already now manifest in the activities of armed gangs. Experts note the beginning of US population fleeing to Europe, where the direct threat to life is for the time being not so great. Aside from armed conflicts, LEAP analysts forecast power, food and water shortages in areas dependent on food imports.

LEAP experts describe behavior demonstrated by the Western elites as absolutely inadequate: "Our leaders have failed to understand what happened, and show the same amount of incomprehension to this day. We are amid a period of protracted recession, and it was necessary to engage in introducing some long-term measures to cushion the blows, whereas our leaders still hope to avoid a prolonged recession… All of them have been formed around the American pillar and cannot see that the pillar is a shambles…"

But this is not seen by the mid-level leaders, while the top-level world managers are, on the contrary, informed quite well; it is they who are implementing the ‘controlled chaos’ and general disintegration policy, including a civil war and the disintegration of the United States planned for the end of 2009, a scenario that is being widely discussed both by American and world media.

On the threshold of conflicts planned in various areas of the planets, a system is being established that will give a supranational center relying on a large-scale punitive machine total political, military, legal, and electronic control over the population. That system uses the network management principle that allows embedding into any society parallel structures of authority that report to external decision-making centers and are legalized through the doctrine of prevalence of international law over national law. The shell remains national, while real power becomes transnational. Jacques Attali calls this a ‘global law-based state’.

The ruling center of the global law-based state is located in the US. While its fundamentals began to emerge in the 1990s, the fight against terrorism after the 9/11 events has lead to radically new phenomena. The passing of the 2001 Patriot Act not only allowed security services to control the American population and suspected foreigners, but also accelerated the passing of state responsibilities into the hands of transnational corporate structures.

Intelligence activities, trade of war, penitentiary system, and information control are passing into private hands. This is done through so-called outsourcing, a relatively new business phenomenon that consists of trusting certain functions to private firms that act as contractors and relying on individuals outside an organization to solve its internal tasks.

In 2007, the American government found out that 70% of its secret intelligence budget is spent on private contracts and that “Cold-War intelligence bureaucracy is transforming into something new, where contractor’s interests dominate.” For American society (Congress included), their activities remain classified, which allows them to gather more and more important functions in their hands.

Former CIA employees say that nearly 60% of their staff are on contracts. Those people analyze most of the information, write reports for those who make decisions in state authorities, maintain communications among various security services, help foreign stations, and analyze data interception. As a result, America’s National Security Agency is becoming more and more dependent on private companies that have access to classified information. No wonder, then, that it is lobbying a bill in the Congress that is supposed to guarantee immunity to corporations that have worked with NSA for the last five years.

The same is happening to private military companies (PMCs), which have been assuming more and more army and police functions. On a significant scale, it started in the nineties in former Yugoslavia, but contract workers were especially widely used in Afghanistan and other conflict zones. They did the ‘dirtiest’ actions, as was the case during the war in South Ossetia, where up to 3000 mercenaries were involved. At the moment, PMCs are real armies, each up to 70,000 strong, that operate in over 60 countries, with annual revenues of up to $180 billion (according to Brookings Institution, USA) For example, over 20,000 employees of American PMCs work in Iraq along with the 160,000 American military contingent.

The system of private prisons is also growing rapidly in the US. The prison industry complex, which uses slave labor and sweatshop practices, is flourishing, and its investors are based on Wall Street. The use of convict labor by private corporations has been legalized in 37 states already, and it is used by major corporations such as IBM, Boeing, Motorola, Microsoft, Texas Instrument, Intel, Pierre Cardin, and others. In 2008, the number of inmates in US private prisons was about 100,000, and it is growing rapidly, along with the total number of inmates in the country (mostly African-Americans and Latin Americans), which is 2.2 million people, or 25% of all convicts in the world.

After Bush came to power, privatization of the system for transportation and retention of migrants in concentration camps began. In particular, a branch of the notorious firm Halliburton, Kellog Brown and Root (once headed by Dick Cheney), did just that.

The biggest achievements have been made over the last few years in the area of establishing electronic control over people’s identities, carried out under the pretext of counterterrorism. Currently, the FBI is creating the world’s biggest database of biometric indexes (fingerprints, retina scans, face shapes, scar shapes and allocation, speech and gesture patterns, etc.) that now contains 55 million fingerprints. The latest novelties include the introduction of body scanning system in US airports, tracking of literature read by passengers in flight, and so on. A new opportunity to gather detailed information on people’s private lives follow from the NSA Directive N59, passed in summer 2008, ‘Identification and tracking biometry for the purpose of strengthening national security’, and the classified ‘Homeland Terrorism Preparedness Law’.

Evaluating the policy of America’s authorities, ex-Congressman and 2008 presidential candidate Ron Paul said that America is gradually turning into a fascist state, “We are approaching not a Hitler-type fascism, but one of a softer type, which shows in the loss of civil freedoms, when corporations rule everything and… the government lies in the same bed with big business.” May we remind you that Ron Paul is one of the few American politicians speaking for the closing of the Federal Reserve System as a secret unconstitutional organization?

With Obama’s coming to power, the police order in America is getting tighter and tighter in two directions – strengthening internal security and militarization of civilian institutions. Tellingly, having condemned the infringements on individual freedoms done by the Bush administration, Obama has put his own staff under total control by making them fill out a 63-question form that touches upon the most intricate details of their private lives. In January, the US President signed bills that enable the continuation of the illegal practice of abducting people, keeping them secretly in prisons, and moving them to countries where tortures are used. He also proposed a bill called National Emergency Help Center Establishment Act, which stipulates the establishment of six such centers in US military bases to provide help to people who are displaced due to an emergency situation or disaster and thus get into military jurisdiction. Analysts connect this bill with possible disturbances and consider it proof that the US administration is preparing for a military conflict which may follow after the provocation that is being planned.

The American system of police control is actively implemented in other countries, primarily in Europe – through the establishment of American law hegemony on its territory by means of closing various agreements. A big part here was played by US–European talks out of the glare of publicity on creation of the common ‘area of control over the population’ that were held in spring 2008, when the European Parliament adopted resolution that ratified creation of the single transatlantic market abolishing all barriers to trade and investments by 2015. The talks resulted in the classified report prepared by the experts from six participating countries. This report described the project to create the ‘area of cooperation’ in the spheres of ‘freedom, safety and justice’.

The report dwells upon the reorganization of the system of justice and internal affairs of the EU member states in such a manner that it would resemble the American system. It concerns not only the ability to transfer personal data and cooperation of police services (which is already being carried out), but also, for example, extradition of EU immigrants to US authorities in accordance with the new mandate that abolished all the guarantees the European procedure of extradition provided. In the US the Military Commissions Act of 2006 is in force, and it allows persecution or imprisonment of any person who is identified as an ‘illegally fighting enemy’ by the executive authorities and extends to immigrants from any country not at war with the US. They are persecuted like “enemies” not based on some evidence but because they were labeled so by the governmental agencies. No foreign governments have protested against this law which is of international importance.

Soon they will sign the agreement on personal data communication, in accordance with which the American authorities will be able to obtain such personal information as credit card numbers, bank account details, investments, travel routes or communication via Internet, as well as the information concerning race, political and religious beliefs, habits, etc.. It was under the US pressure that the EU countries have introduced biometric passports. The new EU regulation implies the overall switch of EU citizens to electronic passports from the end of June 2009 by 2012. New passports will contain a chip with not only passport info and a photo, but also fingerprints.

We are witnessing the creation of the global electronic concentration camp, and crisis, conflicts and wars are used to justify it. As Douglas Reed wrote “people tend to tremble in the face of an imaginary danger and are too lazy to see the real one.”

The Tower of Basel: Secretive Plans for the Issuing of a Global Currency

In an April 7 article in The London Telegraph titled “The G20 Moves the World a Step Closer to

a Global Currency,” Ambrose Evans-Pritchard wrote:

“A single clause in Point 19 of the communiqué issued by the G20 leaders amounts to revolution in the global financial order.

“‘We have agreed to support a general SDR allocation which will inject $250bn (£170bn) into the world economy and increase global liquidity,’ it said. SDRs are Special Drawing Rights, a synthetic paper currency issued by the International Monetary Fund that has lain dormant for half a century.

“In effect, the G20 leaders have activated the IMF’s power to create money and begin global ‘quantitative easing’. In doing so, they are putting a de facto world currency into play. It is outside the control of any sovereign body. Conspiracy theorists will love it.”

Indeed they will. The article is subtitled, “The world is a step closer to a global currency, backed by a global central bank, running monetary policy for all humanity.” Which naturally raises the question, who or what will serve as this global central bank, cloaked with the power to issue the global currency and police monetary policy for all humanity? When the world’s central bankers met in Washington last September, they discussed what body might be in a position to serve in that awesome and fearful role. A former governor of the Bank of England stated:

“[T]he answer might already be staring us in the face, in the form of the Bank for International Settlements (BIS). . . . The IMF tends to couch its warnings about economic problems in very diplomatic language, but the BIS is more independent and much better placed to deal with this if it is given the power to do so.”1

And if the vision of a global currency outside government control does not set off conspiracy theorists, putting the BIS in charge of it surely will. The BIS has been scandal-ridden ever since it was branded with pro-Nazi leanings in the 1930s. Founded in Basel, Switzerland, in 1930, the BIS has been called “the most exclusive, secretive, and powerful supranational club in the world.” Charles Higham wrote in his book Trading with the Enemy that by the late 1930s, the BIS had assumed an openly pro-Nazi bias, a theme that was expanded on in a BBC Timewatch film titled “Banking with Hitler” broadcast in 1998.2 In 1944, the American government backed a resolution at the Bretton-Woods Conference calling for the liquidation of the BIS, following Czech accusations that it was laundering gold stolen by the Nazis from occupied Europe; but the central bankers succeeded in quietly snuffing out the American resolution.3

Modest beginnings, BIS Office, Hotel Savoy-Univers, Basel


First Annual General Meeting, 1931


In Tragedy and Hope: A History of the World in Our Time (1966), Dr. Carroll Quigley revealed the key role played in global finance by the BIS behind the scenes. Dr. Quigley was Professor of History at Georgetown University, where he was President Bill Clinton’s mentor. He was also an insider, groomed by the powerful clique he called “the international bankers.” His credibility is heightened by the fact that he actually espoused their goals. He wrote:

“I know of the operations of this network because I have studied it for twenty years and was permitted for two years, in the early 1960's, to examine its papers and secret records. I have no aversion to it or to most of its aims and have, for much of my life, been close to it and to many of its instruments. . . . [I]n general my chief difference of opinion is that it wishes to remain unknown, and I believe its role in history is significant enough to be known.”

Quigley wrote of this international banking network:

“[T]he powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent private meetings and conferences. The apex of the system was to be the Bank for International Settlements in Basel, Switzerland, a private bank owned and controlled by the world’s central banks which were themselves private corporations.”

The key to their success, said Quigley, was that the international bankers would control and manipulate the money system of a nation while letting it appear to be controlled by the government. The statement echoed one made in the eighteenth century by the patriarch of what would become the most powerful banking dynasty in the world. Mayer Amschel Bauer Rothschild famously said in 1791:

“Allow me to issue and control a nation’s currency, and I care not who makes its laws.”

Mayer’s five sons were sent to the major capitals of Europe – London, Paris, Vienna, Berlin and Naples – with the mission of establishing a banking system that would be outside government control. The economic and political systems of nations would be controlled not by citizens but by bankers, for the benefit of bankers. Eventually, a privately-owned “central bank” was established in nearly every country; and this central banking system has now gained control over the economies of the world. Central banks have the authority to print money in their respective countries, and it is from these banks that governments must borrow money to pay their debts and fund their operations. The result is a global economy in which not only industry but government itself runs on “credit” (or debt) created by a banking monopoly headed by a network of private central banks; and at the top of this network is the BIS, the “central bank of central banks” in Basel.

Behind the Curtain

For many years the BIS kept a very low profile, operating behind the scenes in an abandoned hotel. It was here that decisions were reached to devalue or defend currencies, fix the price of gold, regulate offshore banking, and raise or lower short-term interest rates. In 1977, however, the BIS gave up its anonymity in exchange for more efficient headquarters. The new building has been described as “an eighteen story-high circular skyscraper that rises above the medieval city like some misplaced nuclear reactor.” It quickly became known as the “Tower of Basel.” Today the BIS has governmental immunity, pays no taxes, and has its own private police force.⁴ It is, as Mayer Rothschild envisioned, above the law.

The BIS is now composed of 55 member nations, but the club that meets regularly in Basel is a much smaller group; and even within it, there is a hierarchy. In a 1983 article in Harper’s Magazine called “Ruling the World of Money,” Edward Jay Epstein wrote that where the real business gets done is in “a sort of inner club made up of the half dozen or so powerful central bankers who find themselves more or less in the same monetary boat” – those from Germany, the United States, Switzerland, Italy, Japan and England. Epstein said:

“The prime value, which also seems to demarcate the inner club from the rest of the BIS members, is the firm belief that central banks should act independently of their home governments. . . . A second and closely related belief of the inner club is that politicians should not be trusted to decide the fate of the international monetary system.”

In 1974, the Basel Committee on Banking Supervision was created by the central bank Governors of the Group of Ten nations (now expanded to twenty). The BIS provides the twelve-member Secretariat for the Committee. The Committee, in turn, sets the rules for banking globally, including capital requirements and reserve controls. In a 2003 article titled “The Bank for International Settlements Calls for Global Currency,” Joan Veon wrote:

“The BIS is where all of the world’s central banks meet to analyze the global economy and determine what course of action they will take next to put more money in their pockets, since they control the amount of money in circulation and how much interest they are going to charge governments and banks for borrowing from them. . . .

“When you understand that the BIS pulls the strings of the world’s monetary system, you then understand that they have the ability to create a financial boom or bust in a country. If that country is not doing what the money lenders want, then all they have to do is sell its currency.”5

The Controversial Basel Accords

The power of the BIS to make or break economies was demonstrated in 1988, when it issued a Basel Accord raising bank capital requirements from 6% to 8%. By then, Japan had emerged as the world’s largest creditor; but Japan’s banks were less well capitalized than other major international banks. Raising the capital requirement forced them to cut back on lending, creating a recession in Japan like that suffered in the U.S. today. Property prices fell and loans went into default as the security for them shriveled up. A downward spiral followed, ending with the total bankruptcy of the banks. The banks had to be nationalized, although that word was not used in order to avoid criticism.6

Among other collateral damage produced by the Basel Accords was a spate of suicides among Indian farmers unable to get loans. The BIS capital adequacy standards required loans to private borrowers to be “risk-weighted,” with the degree of risk determined by private rating agencies; and farmers and small business owners could not afford the agencies’ fees. Banks therefore assigned 100 percent risk to the loans, and then resisted extending credit to these “high-risk” borrowers because more capital was required to cover the loans. When the conscience of the nation was aroused by the Indian suicides, the government, lamenting the neglect of farmers by commercial banks, established a policy of ending the “financial exclusion” of the weak; but this step had little real effect on lending practices, due largely to the strictures imposed by the BIS from abroad.7

Similar complaints have come from Korea. An article in the December 12, 2008 Korea Times titled “BIS Calls Trigger Vicious Cycle” described how Korean entrepreneurs with good collateral cannot get operational loans from Korean banks, at a time when the economic downturn requires increased investment and easier credit:

“‘The Bank of Korea has provided more than 35 trillion won to banks since September when the global financial crisis went full throttle,’ said a Seoul analyst, who declined to be named. ‘But the effect is not seen at all with the banks keeping the liquidity in their safes. They simply don’t lend and one of the biggest reasons is to keep the BIS ratio high enough to survive,’ he said. . . .

“Chang Ha-joon, an economics professor at Cambridge University, concurs with the analyst. ‘What banks do for their own interests, or to improve the BIS ratio, is against the interests of the whole society. This is a bad idea,’ Chang said in a recent telephone interview with Korea Times.”

In a May 2002 article in The Asia Times titled “Global Economy: The BIS vs. National Banks,” economist Henry C K Liu observed that the Basel Accords have forced national banking systems “to march to the same tune, designed to serve the needs of highly sophisticated global financial markets, regardless of the developmental needs of their national economies.” He wrote:

“[N]ational banking systems are suddenly thrown into the rigid arms of the Basel Capital Accord sponsored by the Bank of International Settlement (BIS), or to face the penalty of usurious risk premium in securing international interbank loans. . . . National policies suddenly are subjected to profit incentives of private financial institutions, all members of a hierarchical system controlled and directed from the money center banks in New York. The result is to force national banking systems to privatize . . . .

“BIS regulations serve only the single purpose of strengthening the international private banking system, even at the peril of national economies. . . . The IMF and the international banks regulated by the BIS are a team: the international banks lend recklessly to borrowers in emerging economies to create a foreign currency debt crisis, the IMF arrives as a carrier of monetary virus in the name of sound monetary policy, then the international banks come as vulture investors in the name of financial rescue to acquire national banks deemed capital inadequate and insolvent by the BIS.”

Ironically, noted Liu, developing countries with their own natural resources did not actually need the foreign investment that trapped them in debt to outsiders:

“Applying the State Theory of Money [which assumes that a sovereign nation has the power to issue its own money], any government can fund with its own currency all its domestic developmental needs to maintain full employment without inflation.”

When governments fall into the trap of accepting loans in foreign currencies, however, they become “debtor nations” subject to IMF and BIS regulation. They are forced to divert their production to exports, just to earn the foreign currency necessary to pay the interest on their loans. National banks deemed “capital inadequate” have to deal with strictures comparable to the “conditionalities” imposed by the IMF on debtor nations: “escalating capital requirement, loan writeoffs and liquidation, and restructuring through selloffs, layoffs, downsizing, cost-cutting and freeze on capital spending.” Liu wrote:

“Reversing the logic that a sound banking system should lead to full employment and developmental growth, BIS regulations demand high unemployment and developmental degradation in national economies as the fair price for a sound global private banking system.”

The Last Domino to Fall

While banks in developing nations were being penalized for falling short of the BIS capital requirements, large international banks managed to escape the rules, although they actually carried enormous risk because of their derivative exposure. The mega-banks succeeded in avoiding the Basel rules by separating the “risk” of default out from the loans and selling it off to investors, using a form of derivative known as “credit default swaps.”

BIS Tower Building, Basel


Botta 1 Building, Basel


However, it was not in the game plan that U.S. banks should escape the BIS net. When they managed to sidestep the first Basel Accord, a second set of rules was imposed known as Basel II. The new rules were established in 2004, but they were not levied on U.S. banks until November 2007, the month after the Dow passed 14,000 to reach its all-time high. It has been all downhill from there. Basel II had the same effect on U.S. banks that Basel I had on Japanese banks: they have been struggling ever since to survive.8

Basel II requires banks to adjust the value of their marketable securities to the “market price” of the security, a rule called “mark to market.”9 The rule has theoretical merit, but the problem is timing: it was imposed ex post facto, after the banks already had the hard-to-market assets on their books. Lenders that had been considered sufficiently well capitalized to make new loans suddenly found they were insolvent. At least, they would have been insolvent if they had tried to sell their assets, an assumption required by the new rule. Financial analyst John Berlau complained:

“The crisis is often called a ‘market failure,’ and the term ‘mark-to-market’ seems to reinforce that. But the mark-to-market rules are profoundly anti-market and hinder the free-market function of price discovery. . . . In this case, the accounting rules fail to allow the market players to hold on to an asset if they don’t like what the market is currently fetching, an important market action that affects price discovery in areas from agriculture to antiques.”10

Imposing the mark-to-market rule on U.S. banks caused an instant credit freeze, which proceeded to take down the economies not only of the U.S. but of countries worldwide. In early April 2009, the mark-to-market rule was finally softened by the U.S. Financial Accounting Standards Board (FASB); but critics said the modification did not go far enough, and it was done in response to pressure from politicians and bankers, not out of any fundamental change of heart or policies by the BIS.

And that is where the conspiracy theorists come in. Why did the BIS not retract or at least modify Basel II after seeing the devastation it had caused? Why did it sit idly by as the global economy came crashing down? Was the goal to create so much economic havoc that the world would rush with relief into the waiting arms of the BIS with its privately-created global currency? The plot thickens . . . .

Ellen Brown developed her research skills as an attorney practicing civil litigation in Los Angeles. In Web of Debt, her latest book, she turns those skills to an analysis of the Federal Reserve and “the money trust.” She shows how this private cartel has usurped the power to create money from the people themselves, and how we the people can get it back. Her earlier books focused on the pharmaceutical cartel that gets its power from “the money trust.” Her eleven books include Forbidden Medicine, Nature’s Pharmacy (co-authored with Dr. Lynne Walker), and The Key to Ultimate Health (co-authored with Dr. Richard Hansen). Her websites are www.webofdebt.com and www.ellenbrown.com.

NOTES

1. Andrew Marshall, “The Financial New World Order: Towards a Global Currency and World Government,” Global Research (April 6, 2009).

2 Alfred Mendez, “The Network,” The World Central Bank: The Bank for International Settlements, http://copy_bilderberg.tripod.com/bis.htm.

3 “BIS – Bank of International Settlement: The Mother of All Central Banks,” hubpages.com (2009).

4 Ibid.

5 Joan Veon, “The Bank for International Settlements Calls for Global Currency,” News with Views (August 26, 2003).

6 Peter Myers, “The 1988 Basle Accord – Destroyer of Japan’s Finance System,” http://www.mailstar.net/basle.html (updated September 9, 2008).

7 Nirmal Chandra, “Is Inclusive Growth Feasible in Neoliberal India?”, www.networkideas.org (September 2008).

8 Bruce Wiseman, “The Financial Crisis: A look Behind the Wizard’s Curtain,” Canada Free Press (March 19, 2009).

9 See Ellen Brown, “Credit Where Credit Is Due,” www.webofdebt.com/articles/creditcrunch.php (January 11, 2009).

10 John Berlau, “The International Mark-to-market Contagion,” OpenMarket.org (October 10, 2008).

The international monetary system’s breakdown is underway

The next stage of the crisis will result from a Chinese dream. Indeed, what on earth can China be dreaming of, caught – if we listen to Washington – in the “dollar trap” of its 1,400-billion worth of USD-denominated debt (1)? If we believe US leaders and their scores of media experts, China is only dreaming of remaining a prisoner, and even of intensifying the severity of its prison conditions by buying always more US T-Bonds and Dollars (2).

In fact, everyone knows what prisoners dream of? They dream of escaping of course, of getting out of prison. LEAP/E2020 has therefore no doubt that Beijing is now (3) constantly striving to find the means of disposing of, as early as possible, the mountain of « toxic » assets which US Treasuries and Dollars have become, keeping the wealth of 1,300 billion Chinese citizens (4) prisoner. In this issue of the GEAB (N°34), our team describes the “tunnels and galleries” Beijing has secretively begun to dig in the global financial and economic system in order to escape the « dollar trap » by the end of summer 2009. Once the US has defaulted on its debt, it will be time for the « everyman for himself » rule to prevail in the international system, in line with the final statement of the London G20 Summit which reads as a « chronicle of a geopolitical dislocation », as explained by LEAP/E2020 in this issue of the Global Europe Anticipation Bulletin.

Quarterly Chinese foreign exchange reserves growth - Source: People’s Bank of China / New York Times, 04/2009

Behind London’s « fools’ game », where everyone pretended to believe that an event of « historical » international co-operation (5) took place, the G20 summit in fact revealed major divisions. The Americans and British (followed by a compliant Japan) desperately tried to preserve their capacity to maintain control over the global financial system, freezing or diluting any significant reform granting more power to the other players, but in fact no longer powerful enough to enforce their aims. The Chinese, Russians, Indians, Brazilians,… strove to change the balance of the international monetary and financial system in their favour, but were unable (or maybe, deep down, unwilling (6)) to impose their reforms. The Europeans (the EU without the United Kingdom) proved incapable of making up their minds between the only two options available: duplicating US and UK policies and sinking along with them, or questioning the very roots of the current monetary and financial system in partnership with the Chinese, the Russians, the Indians and the Brazilians. Today the Europeans have avoided following Washington and London in their endless reproduction of failed past policies (7), but they do not yet dare to prepare for the future.

The ongoing collapse of world trade growth cannot be explained by past relationships – Quarterly growth rates annualized - Source: OECD, March 2009

The Europeans can be held accountable if, in the remaining small window of opportunity (less than 6 months now), they fail to undertake the necessary steps to avoid a 10 year-long tragic crisis (8). Indeed they have the technical know-how that can help to create an international currency based on a basket of the world’s most important currencies, and they know which political approach is required to best combine the various strategic interests of a group of countries whose currencies would comprise the new international reserve currency. Unfortunately, EU leaders (namely Eurozone ones) clearly seem unable to face their responsibilities today, as if they preferred to let the Western system break down (though claiming the contrary) rather than fight to turn it into a bridge leading to a new global system. It may be a choice (LEAP/E2020 does not believe so); it may also be the result of the pusillanimity of EU leaders selected on the basis of their docility (vis-à-vis Washington and major European financial and economic players). In any event, this neutrality is dangerous for the world because it prevents the launch of an effective process to avoid a decade-long tragic crisis to unwind (9).

In this issue of the GEAB, our researchers anticipate the different forms a US default will take at the end of summer 2009, a US default which can no longer be concealed concealable from this April (most taxes are collected in April in the US) onward (10). The perspective of a US default this summer is becoming clearer as public debt is now completely out of control with skyrocketing expenses (+41%) and collapsing tax revenues (-28%), as LEAP/E2020 anticipated more than a year ago. In March 2009 alone, the federal deficit has nearly reached USD 200-billion (way above the most pessimistic forecasts), i.e. a little less than half of the deficit recorded for the entire year 2008 (a record high year) (11). The same trend can be observed at every level of the country’s public organisation: federal state, federated states (12), counties, towns (13), everywhere tax revenues are vanishing, suffocating the whole country with spiraling debts that no one can control anymore (not even Washington).

US tax receipts on corporate income (1930 – 2009) - Sources: US Department of Commerce / Saint Louis Federal Reserve (Q2-Q3 2009 projection by EconomicEdge)

In this issue of the GEAB (N°34), our researchers focus on how to explain the « mystery of gold price ». Indeed, our seekers (of information, not gold) identified a number of interesting leads to understand why (14) the price of gold has been fluctuating around the same level for months when the number of gold buyers is constantly increasing and demand for coins and bars far exceeds available supply in many countries.

Finally, our team gives recommendations on how to prepare for the crisis in the coming months, with particular regard to savings and life-insurance.

---------
Notes:

(1) Total Chinese foreign exchange reserves amount to USD 2,000-billion, of which USD-denominated assets are 70 percent maximum, equal to USD 1,400 billion. The remaining 30 percent mainly consists of EUR-denominated assets.

(2) Most of the time, the same « experts » predicted that global economy would benefit from banking deregulation, that the Internet economy was opening up an era of endless growth, that US deficits were a sign of strength, that US house prices would always go up, and that taking on debt was the modern way to get rich.

(3) The message on the necessity to switch international reserve currency, sent out by Beijing to the world – to US authorities in particular –, on the eve of London’s G20 Summit, was not intended to merely test the waters nor was it some vague attempt with no hope of success. The Chinese leaders had no illusion on the chances for this topic to be actually addressed in the G20 Summit, but they wanted it to be discussed in the backrooms, because they wanted to send an unofficial signal to all the players of the international monetary system: in Beijing’s mind, the Dollar system is over! If no one wishes to prepare for a common alternative system, the alternative system will be built some other way, knowing that the actions the Chinese are currently taking corroborate this intention. For instance, precisely these days (random political schedule is rare in Beijing) a book is being published, entitled « Unhappy China », arguing that Chinese leaders should stand up and impose their choices on the international arena. Source: ChinaDailyBBS, 03/27/2009

(4) This link gives the figures to the last cent: ChineInformation.

(5) Angela Merkel was closest to the truth about the G20 summit when she called it « an almost historical event ». The word “almost” is emblematic of what happened in London: the G20 leaders “almost” created a framework for a joint action programme, they “almost” launched new stimulus plans and new international financial rules, they “almost” banned tax-havens, and they “almost” convinced everyone that it would happen. “Almost” but not “really”, will make a big difference for the next stages of the crisis.

(6) In the previous issue of the GEAB (N°33), our team explained this dilemma for the “international system” today. At some point, it is in the interests of new players to simply wait for the current system to break down in order to build a new one, rather than strive to reform it, and suffer a long period of uncertainty.

(7) In particular, outrageous government borrowing - also called « economic stimulus » in Washington and London.

(8) The decisions taken at London’s G20 summit directly contribute to the long-term crisis scenario.

(9) As regards the EU, LEAP/E2020 emphasizes the inanity of all those economic and political « analyses », produced by leading economists and experts close to the American Democrats, and circulated by all the largest international mainstream media, blaming the Europeans for not following in Washington’s footsteps. Taking their lead from people like Paul Krugman for instance, these « very good friends » of Europe, who like it so much that they think they know better than Europe what is best for it (and what it should become, as indeed the same experts usually advocate its extension to Turkey, see Israel and Central Asia), whereas they would be best giving some quality advice to their own party and their new President to prevent their own country from collapsing, as this is what is really at stake today. It is beyond belief that a panel of experts, who, in all these years, sang the praises of a system which is today collapsing under everyone’s nose, still dares give lessons to the rest of the world. Basis decency suggests only one course of conduct worldwide: silence. In Europe, this position, despite the fact that it still enjoys its usual academic and media support, is too outdated to be accepted. LEAP/E2020 believes it is necessary and legitimate to cast a critical eye on the EU, its leaders and its policies; but doing so on the sole criteria of its conformity or otherwise with Washington’s (or London’s) stance is no longer acceptable. In the same way as financiers and business leaders obviously failed to understand that times had changed regarding their stock-options and “golden parachutes”, a number of intellectuals and politicians have not yet fully understood that their points of reference, values and theories now belong to the past. They should think of the elites of the Soviet bloc and they would understand how and how fast a thought system can become obsolete.

(10) Besides collapsing tax revenues, a protest movement has started in the US against using taxes to save Wall Street and against further deficits, blaming the country’s entire leading class. Sources: USAToday, 04/13/2009; MarketWatch, 04/16/2009

(11) Sources: USAToday, 04/11/2009; MarketWatch, 04/10/2009

(12) In California for instance, the first days of April suggested revenues far lesser than the worse forecasts, likely to result in multiplying two-fold California’s debt anticipated a few months ago. A similar trend is under way at the federal level, making it possible to imagine that the annual federal deficit reaches above USD 3,500 billion, i.e. 20 percent of US GDP. Source : CaliforniaCapitol, 04/08/2009

(13) Some towns, like Auburn near Seattle for instance, are compelled to ban trucks from their major freight routes by lack of maintenance financial means. Source: SeattleBusinessJournal, 04/10/2009

(14)Thus enabling to anticipate upcoming trends.


(c) LEAP/E2020

War, Oil and Gas Pipelines: Turkey is Washington’s Geopolitical Pivot

The recent visit of US President Obama to Turkey was far more significant than the President’s speech would suggest. For Washington Turkey today has become a geopolitical “pivot state” which is in the position to tilt the Eurasian power equation towards Washington or significantly away from it depending on how Turkey develops its ties with Moscow and its role regarding key energy pipelines.

If Ankara decides to collaborate more closely with Russia, Georgia's position is precarious and Azerbaijan's natural gas pipeline route to Europe, the so-called Nabucco Pipeline, is blocked. If it cooperates with the United States and manages to reach a stable treaty with Armenia under US auspices, the Russian position in the Caucasus is weakened and an alternative route for natural gas to Europe opens up, decreasing Russian leverage against Europe.

For Washington the key to bringing Germany into closer cooperation with the US is to weaken German dependence on Russian energy flows. Twice in the past three winters Washington has covertly incited its hand-picked President in Ukraine, Viktor Yushchenko to arrange an arbitrary cut off of Russian gas flows to Germany and other EU destinations. The only purpose of the actions was to convince EU governments that Russia was not a reliable energy partner. Now, with the Obama visit to Ankara, Washington is attempting to win Turkish support for its troubled Nabucco alternative gas pipeline through Turkey from Azerbaijan which would theoretically at least lessen EU dependence on Russian gas.

The Turkish-EU problem

However willing Turkish Prime Minister Erdogan might be to accommodate Obama, the question of Turkish relations with the EU is inextricably linked with the troublesome issue of Turkish membership to the EU, a move vehemently opposed by France and also less openly by Germany.

Turkey is one of the only routes energy from new sources can cross to Europe from the Middle East, Central Asia or the Caucasus. If Turkey — which has considerable influence in the Caucasus, Central Asia, Ukraine, the Middle East and the Balkans — is prepared to ally with the United States, Russia is on the defensive and German ties to Russia weaken considerably. If Turkey decides to cooperate with Russia instead, Russia retains the initiative and Germany is dependent on Russian energy. Since it became clear in Moscow that US strategy was to extend NATO to Russia’s front door via Ukraine and Georgia, Russia has moved to use its economic “carrot” its vast natural gas resources, to at the very least neutralize Western Europe, especially Germany, towards Russia. It is notable in that regard that the man chosen as Russia’s President in December 1999 had spent a significant part of his KGB career in Germany.

Turkey and the US Game

It is becoming clear that Obama and Washington are playing a deeper game. A few weeks before the meetings, when it had become obvious that the Europeans were not going to bend on the issues such as troops for Afghanistan or more economic stimulus that concerned the United States, Obama scheduled the trip to Turkey.

During the recent EU meetings in Prague Obama actively backed Turkey’s application for EU membership knowing well that that put especially France and Germany in a difficult position as EU membership would allow free migration which many EU countries fear. Obama deliberately confronted EU states with this knowing he was playing with geopolitical fire, especially as the US is no member of the EU. It was a deliberate and cheap way to score points with the Erdogan government of Turkey.

During the NATO meeting, a key item on the agenda was the selection of a new alliance secretary-general. The favorite was former Danish Prime Minister Anders Fogh Rasmussen. Turkey opposed him because of his defense of cartoons depicting the Prophet Mohammed published in a Danish magazine. NATO operates on consensus, so any one member can block Rasmussen. The Turks backed off the veto, and in return won two key positions in NATO, including that of deputy secretary-general.

Turkey thereby boosted its standing in NATO, got Obama to vigorously defend the Turkish application for membership in the European Union, which of course the United States does not belong to. Obama then went to Turkey for a key international meeting that will allow him to further position the United States in relation to Islam.

Obama has a Grand Strategy to use Turkey to isolate Russia via Nabucco pipelines through Georgia and Armenia to the EU

The Obama Erdogan talks were perhaps the most strategic of the recent Obama tour


The Russian Dimension

During US-Russian talks there had been no fundamental shift by Obama from the earlier position of the Bush Administration. Russia rejects Washington’s idea of pressuring IUran on their nuclear program in return for a bargain of an undefined nature with Washington over US planned missile and radar bases in Poland and the Czech Republic. The US claimed it need not rely on Russia to bring military and other supplies into Afghanistan, claiming it had reached agreement with Ukraine to transship mililtary supplies, a move designed by Washington to increase friction between Moscow and Kiew. Moreover, the NATO communique did not abandon the idea of Ukraine and Georgia being admitted to NATO. The key geopolitical prize for Washington remains Moscow but clearly Turkey is being wooed by Obama to play a role in that game.

Germany will clearly not join Obama in blocking Russia. Not only does Germany depend on Russia for energy supplies. She has no desire to confront a Russia that Berlin sees as no real immediate threat to Germany. For Berlin, at least now, they are not going to address the Russian question.

At the same time, an extremely important event between Turkey and Armenia is shaping up. Armenians had long held Turkey responsible for the mass murder of Armenians during and after World War I, a charge the Turks have denied. The US Congress is considering a provocative resolution condeming “Turkish genocide” agianst Armenians. Turkey is highly sensitive to these charges, and Congressional passage of such a resolution would have meant a Turkish break in diplomatic relations with Washington. Now since the Obama visit Ankara has begun to discuss an agreement with Armenia including diplomatic relations which would eliminate the impact of any potential US Congress resolution.

A Turkish opening to Armenia would alter the balance of power in the entire region. Since the August 2008 Georgia-Russia conflict the Caucasus, a strategically vital area to Moscow has been unstable. Russian troops remain in South Ossetia. Russia also has troops in Armenia meaning Russia has Georgia surrounded.

Turkey is the key link in this complex game of geopolitical balance of power between Washington and Moscow. If Turkey decides to collaborate with Russia Georgia’s position becomes very insecure and Azerbaijan’s possible pipeline route to Europe is blocked. If Turkey decides to cooperate with Washington and at the same time reaches a stable agreement with Armenia under US guidance, Russia’s entire position in the Caucasus is weakened and an alternative route for natural gas to Europe becomes available, reducing Russian leverage against Western Europe.

Therefore, having sat through fruitless meetings with the Europeans, Obama chose not to cause a pointless confrontation with a Europe that is out of options. Instead, Obama completed his trip by going to Turkey to discuss what the treaty with Armenia means and to try to convince the Turks to play for high stakes by challenging Russia in the Caucasus, rather than playing Russia's junior partner.

The most important Obama speech in his European tour came after Turkey won key posts in the NATO political structure with US backing. In his speech Obama sided with Turkey against the EU and in effect showed Turkey Washington was behind her. Obama’s speech addressed Turkey as an emerging regional power, which was well received in Ankara. The sweet words will cost Turkey dearly if it acts on them.

Moscow is not sitting passively by as Washington woos Turkey. Turkish President Abdullah Gul paid a four-day visit to the Russian Federation this February, where he met with President Dmitry Medvedev, Prime Minister Putin, and also traveled to Kazan, the capital of Tatarstan, where he discussed joint investments. Gul was accompanied by his minister for foreign trade and minister of energy, as well as a large delegation of Turkish businessmen. The stakes in this complex three-way Great Game for domination of Eurasia have been raised significantly following the Obama trip to Ankara. Turkey imports 65 percent of its natural gas and 25 percent of its oil from Russia. Therefore, Turkey is also developing a growing dependency on Russian energy resources, including coal.

On March 27, 2009, a memorandum was signed between the Azerbaijani oil company SOCAR and Russia's Gazprom. The memorandum includes a statement of deliveries, beginning in January 2010, of Azerbaijani natural gas to Russia.

Gazprom was particularly interested in signing such an agreement with Azerbaijan, not the least because Azerbaijan is the only state outside Iran or Turkmenistan, both of which are problematic, that could supply gas to the planned EU Nabucco pipeline, for transporting natural gas from Azerbaijan and the Central Asia states through Turkey to south-eastern Europe. In reality, gas may come only from Azerbaijan. Russia has proposed an alternative to Nabucco project, South Stream, also in need of Azerbaijani gas, so in effect Russia weakens the chances of realization of Nabucco. Obama strategy is clearly not less confrontational with Russia. It is merely playing with a slightly different deck of cards than did Cheney and Bush.

by F. William Engdahl

Burning our Bridges to the XXI Century

The future does not resemble the past – or does it? When the lights go out, people burn candles and oil lamps, just like they used to before the electric grid came into existence. No longer accustomed to working with open flame, they tend to set things on fire, and for a while, until they regain this experience or until natural selection whittles away the truly incompetent, the neighborhood is a constant blaze.

When we find out that the supermarket is out of food and that the cupboard is bare, we hunt, fish, forage, plant kitchen gardens, and start experimenting with raising poultry and rabbits. Those who are incapable of doing so, or who feel that such lowly pursuits are beneath their dignity, become dependent on the charity of those who are more adaptable, or starve.

As modernity runs out of resources (those photons sequestered eons ago in fossil form, now released as carbon dioxide into the atmosphere) patterns of life naturally retreat to their pre-modern forms. If there are no more sneakers from China, we sew moccasins or whittle clogs. If we are resource-poor but resourceful, we can still weave basket-like shoes out of birch bark, stuffed with straw for insulation, called lapti. If we are truly destitute and feckless to boot, then we go barefoot.

It seems commonsense to accept this reversion to norm as natural, and to strive to have enough of whatever we are going to need, be it tools for working leather, a stock of paraffin, seeds, fishing tackle, and a myriad of other similar items that comprised the pre-industrial survival kit. The last thing we should want to do is to throw these things away at first sign of economic distress and for trivial reasons. And yet that seems to be the prevailing pattern.

For instance, if the expectation is that foreigners will no longer want to trade their dwindling crude oil endowment in exchange for worthless US Dollars, and that the US will lose access to 2/3 of its liquid hydrocarbons, it would make sense to make some provisions for raising food and for moving freight. Since a John Deere won’t run on hay, that calls for some horses. Furthermore, now is a perfect time for farms to get “horsed up” because so many horse-owners can no longer afford the luxury of keeping a horse, and it is possible to buy a horse very, very cheaply. Many horse-owners would be perfectly happy to donate their horse and take a tax write-off rather than see their beloved pet turned into glue. Instead, horses are trucked to rending facilities across the border in Mexico, to endure incredible suffering while in transit, and then to be incompetently hacked up with machetes.

Before the advent of fossil fuels, freight that could not be moved by horse and wagon moved by sail. It would therefore make perfect sense that we keep all the sailboats we currently have, because they will surely be pressed into use once other transportation options are no longer available. Keeping a sailboat afloat is not particularly expensive; there are protected coves where a boat can be kept anchored free of charge, provided it is tended to once in a while. The smaller, trailerable boats are also useful, and can keep for years on the hard, under a tarp in someone’s back yard. And yet what is happening now is that sailboat owners, unable to pay the slip fees and the upkeep of their luxury toy, abandon it, simply letting it float away and eventually sink, with its mast protruding out of the water at low tide, or to wash up on a beach, where the surf pounds it into rubble. Even if the boat itself is unsuited for any practical purpose (and, thanks to the combined detrimental effects of sport and luxury on the sailboat market, there are far too many of these) then at the very least they could be stripped of Dacron sailcloth, stainless steel and bronze fittings, lead ballast, marine-grade stranded copper wiring, aluminum spars, and many other items which are both very useful and unlikely to be manufactured in the future in an economy that runs on wind, hay and firewood. The remaining hollow fiberglass husks could make interesting, long-lasting treehouses.

Not that, in general, there is a lack of effort to save things. We are making an effort to save financial institutions, which are the ultimate ephemera of industrial civilization, and are absolutely guaranteed to have no reason to continue into a future in which debt, denominated in future earnings that will be meager at best, and money, which will only hold its value for as long as it guarantees access to sources of pure, concentrated energy, all steadily dwindle to nothing. It is as if the doctors decided to only try to save persistent vegetative quadriplegics with terminal cancer, or if the environmentalists decided that the endangered species list only has room for one animal: the vampire bat. It would make much more sense to try to save small businesses, such as family businesses that serve local communities, because there is a good chance that they will find a use in the future, or at least facilitate the transition. Instead, we are squandering the remaining resources on the various dinosaurs of the industrial age.

I believe in providing a hopeful vision of the future as much as I believe in providing a sufficiently horrific vision of the present for it to be, in my opinion, a realistic one. However, I am beginning to feel somewhat thwarted in my efforts by this new compulsion sweeping the land to shoot oneself in the foot while simultaneously setting one's hair on fire. The only hope I can offer you today is that this current trend toward suicidal stupidity is temporary, and that it will run its course long before we completely ruin our chances for an orderly regression.