We Now Live in a “Pimpocracy”
Shabby Immensity
Today, we continue mouth wide open … staggered by the shabby immensity of it … a tear forming in the corner of our eye.
Yes, we are looking at how the US economy, money and government have changed since President Nixon ended the gold-backed monetary system in 1971. It is not pretty.
We already know about the money. Since 1971, it’s been a credit-based, not a gold-based, system. The pre-1971 economy had three key characteristics:
1) It was healthy – Industry made things and sold them at a profit
2) It was fair – Financial progress was fairly evenly distributed.
3) It was solvent – The US was a creditor, not a debtor, nation.
Cartoon by David Horsey
Change in global share of manufacturing output, selected countries (via Vox EU)
Platitudes and Hypocrisies
Americans still say they believe in free markets, democracy and financial rectitude. But only as platitudes and hypocrisies. America’s industries have largely been shipped over to China and other lower-cost producers in the emerging world.
That didn’t “just happen.” The Fed’s EZ money financed it. American consumers borrowed to spend more than they could afford. Walmart met their desires (if not their needs) with “Everyday Low Prices,” courtesy of low-paid Chinese workers.
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