Donald Trump and the Zombie Elites - Mike Swanson (02/09/2017)
This is the first post in what is going to be series of posts about Donald Trump, the United States, and you and I.
It’s going to be about the rise of Trump, what he represents, and today’s American political culture.
My goal is not to support or bash Trump or the Democrats, but to do the best I can do to bring understanding to what is going on today.
Of course, this will impact investing and what goes on in the financial markets even if right now things seem odd.
When it comes to the markets there is no volatility and no worries about anything.
In fact, the stock market made history this week, because the S&P 500 just logged 80 straight days without falling even one percent in a single day.
And it’s funny, because the markets are calmer now for the moment than ever before, but when you talk to people just about anywhere there is more of a feeling of unease than ever before too.
And much of that is associated with the election and Donald Trump.
You have people against Trump demonstrating against him who appear in the eyes of the Trump voters to be irrationally freaking out simply because they lost the election.
At the same time, you do have a lot of uncertainty over what Donald Trump is going to do.
He came in as a populist set to make massive changes and that is going to mean breaking some serious eggs.
I spent the days following Trump’s election victory spending hours on the phone talking to various people and reading material to try to figure out Trump myself.
I then wrote a 30 page plus private report to my Power Investor members about what Trump is looking to do in regards to the economy and how it will likely impact the financial markets.
I was considering actually writing a book about my findings.
But I didn’t do it.
I came to see that the news cycle was simply moving too fast for me to write a book.
So instead I’m going to aim to do a couple of blog posts a month about Trump and the state of American society and culture.
That’s going to enable me to touch on a lot of topics and write about things I have wanted to talk about for some time.
I also think that blog posts might be the best format for something like this, because with blog posts you can put videos in them and can link them to each other and to other sources of information and over time actually build up a great encyclopedic type of resource for people.
I got a unique take on things.
I really do not care about looking at things from the partisan prism that dominates our media and political system.
So I’m likely to say things that might upset both sides or actually force people at times to look at things a little differently that might disturb them.
So why am I calling this post today Donald Trump and the Zombie Elites?
Donald Trump won the Republican Primaries last year because of a collapse within the Republican Party that enabled him to walk right through and dominate it.
The Republican Primary voters had enough of Jeb Bush and the others like him and wanted real change.
And on the November election-day we saw that evening that the rest of the American people decided too that they wanted to reject the system so to speak and vote for the man who positioned himself against it.
Nothing like it had been seen in American politics in our lifetimes.
But all of this happened because of a failure of the elites.
Life is not static.
American history has gone through changes at times and there have been times when one elite faction has dominated one political party or the entire political system.
Starting in the 1970’s a rise of a new banking and financial elite began with a new vision of the world.
Nixon took the US dollar off of the gold standard and that enabled a new era of monetary policy of limitless money printing that brought huge stock market gains and enabled countries all of the world to build more and more debt.
The former Greek finance minister Yanis Varoufakis described this best in his book The Global Minotaur: America, the True Origins of the Financial Crisis and the Future of the World Economy.
This global financial elite believed that free trade could grow the world and actually create a better type of society than had been seen in the past.
This was a time of the Cold War in the 1970’s and they believed that this Cold War would end one day and they were preparing for that day in which they would assert leadership and create a “new world order” for the good of mankind built on peace and prosperity.
Of course, this elite was set to benefit and did indeed benefit through free trade, because the more money flows around the world the more transactions are made at banks and the more loans are made with banks and so the more banks will profit.
But they thought what was good for them was best for everyone, because it would enable them to become a new type of satisfied person.
This new vision was actually shown to the American people in a classic 1970’s movie titled Network.
You should see this movie as it has revalance for today.
I’m not going to go into the whole plot, but it is about a major television network and the people who work for it - one of whom is a reporter talking head named Howard Beale who decides to stop playing the role of spitting BS talking points to his audience and speak the truth.
He then finds out that foreigners are going to buy the TV network he works for and wants to stop it.
So he goes to confront the ruler of the network and then finds out that the way he thought the world works is not the way it really works.
This network ruler named Arthur Jensen explains the way things really work to him and then lays down a new vision of the world for him to believe in, which includes a new vision for human life itself.
The ruler says, “You are an old man who thinks in terms of nations and peoples. There are no nations. There are no peoples. There are no Russians. There are no Arabs. There are no Third Worlds. There is no West. There is only one holistic system of systems.
One vast and immane, interwoven, interacting, multi-varied, multi-national dominion of dollars. Petro-dollars, electro-dollars, multi-dollars, reichmarks, rands, rubles, pounds and shekels.”
“It is the international system of currency which determines the totality of life on this planet. That is the natural order of things today. That is the atomic, and sub-atomic and galactic structure of things today.”
Jensen then says, “We no longer live in a world of nations and ideologies, Mr Beale. The world is a collage of corporations, inexorably determined by the immutable bye-laws of business. The world is a business, Mr Beale. It has been since man crawled out of the slime.”
“And our children will live, Mr Beale, to see that ... perfect ... world in which there is no war nor famine, oppression or brutality. One vast and ecumenical holding company for whom all men will work to serve a common profit. In which all men will hold a share of stock.”
“All necessities provided. All anxieties tranquilized. All boredom amused.”
This was the first time this vision was shown to the American people in a movie theater.
But in real life it was best pushed for and advocated at the time by David Rockefeller and his Trilateral Commission founded in 1973.
These policies would benefit Americans and the rest of the west by creating economic growth and an acceleration in “happiness” and “comfort” through consumer goods and television watching.
But the Network movie warned too that there would be a cost of this too for people in their relationship with politics and to their own individuality at the end of it in a final speech by Beale.
Instead of remaining individuals, they would become a part of the mass.
And people really took the deal.
Instead of fighting they became obedient.
Those that were young in the 1960’s going through the sexual revolution and going through the wars and demonstrations of that era became the contented yuppies of the 1980’s.
When the Berlin Wall fell it looked like the vision of the network ruler had been fully achieved and within a full decades the entire world would be integrated into this global system and finally as one best-selling author put it at the time it would mean The End of History and the Last Man.
But two things happened.
First despite the way it appeared there is no tiny power elite that is capable of ruling the entire world, because businesses and elites rise and fall and often what ends up happening is you get competing power elites with different interests that end up battling things out using the politicians as their own personal weapons.
And secondly, this global system of trade became imbalanced by all of the debts it created and grew more and more unstable.
In fact, it has gotten to the point where today you cannot find a figure like David Rockefeller among the elites who truly believes that they are going to create a final end of history.
Instead, the financial elites of today feel under siege as populists in Europe and Donald Trump in the United States now are asserting the primacy of the nation over the individual elite.
And so the European Union itself is under threat of collapse.
The problem is that the elites over the past twenty years have not been able to fix the imbalances in the system.
The 2000 internet bubble burst was the first problem that became dominating news.
But the imbalances began with debt crisis in Latin America in the early 1980’s and grew with the US Savings and Loans Crisis and the 1998 bailout of the LTCM hedge fund.
Those were the events that led to 2000 bubble bust.
And of course, it all came to a final head in 2008 with the financial crash of that year.
Or did it?
Since 2008 the Central Bankers around the world have engaged in QE money printing programs in order to stabilize the system, but they have not been able to return the system to true sustainable economic growth, because they have been unable to fix the imbalances.
Yes - stock markets have boomed since 2008, but the global economy has remained sick.
That’s a recipe for political turmoil and that is exactly what has begun.
However, the economic malaise has also hurt companies that are not a part of the financial and banking sectors.
Take a look at this chart of the US trade with the rest of the world including exports and imports.
When world trades shrinks it means there is less real profit to go around.
This goes a long way to explaining Donald Trump.
Shrinking global trade hurts some American businesses and makes talk of tariffs attractive to them!
But the whole vision of the 1970’s banking elite was one of growing global trade and money flows and they hit a wall.
And without limitless never stopping or never pausing growth they have been incapable of believing anymore in a great future vision down the road and so have the masses themselves.
And so the financial elites have become nihilistic.
There is no other way to describe them than that, because they have been incapable of engaging in any reforms or putting things back on an even track.
And that has created a massive leadership gap in the political and business world that Donald Trump took advantage of to become the President of the United States.
Perhaps no better commentator today has described the current policies of the financial elites and why they are now nihilistic than economist Michael Hudson.
Here is an interview with him.
As Hudson puts it’s “debts that can’t be paid won’t be paid.”
And that day of reckoning will one day be our future.
If it hits when Trump is in the White House what will he do?
Well Donald Trump and the people around him have a different way of seeing the world than David Rockefeller did.
Trump does not worship free trade and instead sees business as a zero-sum negotiation game of winners and losers.
In Trump’s world you either are with him or against him.
That’s how he has done business and that is how he is going to play politics whether that means domestic politics or world politics.
For just one example of this witness how he responded at a Sheriff’s meeting the other day when he heard of a lawmaker in Texas who did not see things the same way he did.
David Rockefeller is still alive at 101 years old.
But he has become senile and lost his mind.
You may want to call him a zombie elite, but I am sure he is still proud of the role he played in the world.
In 2003 Rockefeller published his memoirs and wrote, “For more than a century, ideological extremists at either end of the political spectrum have seized upon well-publicized incidents such as my encounter with Castro to attack the Rockefeller family for the inordinate influence they claim we wield over American political and economic institutions. Some even believe we are part of a secret cabal working against the best interests of the United States, characterizing my family and me as 'internationalists' and of conspiring with others around the world to build a more integrated global political and economic structure — one world, if you will. If that is the charge, I stand guilty, and I am proud of it.”
And as far as his critics go he also wrote, “The anti-Rockefeller focus of these otherwise incompatible political positions owes much to Populism. Populists believe in conspiracies and one of the most enduring is that a secret group of international bankers and capitalists, and their minions, control the world's economy. Because of my name and prominence as head of the Chase for many years, I have earned the distinction of ‘conspirator in chief’ from some of these people.”
“Populists and isolationists ignore the tangible benefits that have resulted in our active international role during the past half-century. Not only was the very real threat posed by Soviet Communism overcome, but there have been fundamental improvements in societies around the world, particularly in the United States, as a result of global trade, improved communications, and the heightened interaction of people from different cultures. Populists rarely mention these positive consequences, nor can they cogently explain how they would have sustained American economic growth and expansion of our political power without them,” Rockefeller wrote.
Well with the rise of Trump we will all find out how the populists do.
People are calling Trump all sorts of things, but it is time and history that will tell the tale.
However, so far what Trump has been offering is not the empowerment of the individual human being in a return to the values that founded America, but a new form of citizenship in which the citizen worships the state and the leader of the state as his friend and big brother who can defend him against all enemies and threats whether they come from the outside or inside. The new Trump man is to obey and worship Trump and hate anyone that disagrees with Trump no matter what the issue is.
So you got one elite that tried to create a system that failed and a Donald Trump faction coming in trying to create a new order out of the current chaos.
Just because one order fails does not necessarily mean that the next one is going to be better or worse, but only that it will be different.
Ironically the Network movie in an earlier scene showed how a person can get out of these cross currents, but it all seems so crazy and deranged to anyone witnessing it and seemingly impossible to maintain - as Jensen later took control of Beale in the movie and then set up a chain of events to lead to his televised assassination.
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