## Monday, June 27, 2016

### Do you have a Collapse Insurance Policy?

Note: this one is a bit gloom-and-doom, with a survivalist bent

Alan Greenspan has raised the alarm about impending economic doom, and has even called for a return to the gold standard. Now your first thought might be, "didn't that guy kinda prove himself to be chronically wrong when forecasting the economy?" And you'd be right, because he did. Hailed as a genius, if you could go back in time through his tenure as Fed Chairman, closely follow his predictions, and then assume they were 100% wrong, you could make a killing. If ever there was a person who should be jailed for acting smarter than he is, it is Alan Greenspan.

On the other hand, for someone in his position to raise such claims merits attention. It's like if the former CEO of McDonald's said we should all stop eating out, but with more desperation. And really, who has a better feel for our economy crashing than the man with the most experience at wrecking it himself?

So I'm going to move forward with his warning, because it highlights my own predictions on the matter (tie goes to the confirmation bias). I hope to influence the reader to understand the dynamics at play here, and solidify their own circumstances, as well as to put myself on the record in the matter (people never believe that you successfully predicted something unless you can prove it).

I believe, like Greenspan, that economic and political calamity is inevitable, and I don't think most people are ready for such an event, physically or psychologically. Prompting Greenspan's comments were questions about Brexit's expected effect on the economy. The prognosis doesn't seem to be good. On the face of it, Brexit should not greatly change the global economic situation. I don't believe London will enact policies vastly different than those imposed on it by Brussels (although there will be some improvements). But what Brexit does is, it starts the run on the bank. No one wants to be the last loser in Europe holding the EU debt, and housing all the unproductive migrants. Brexit is not the problem, any more than the nervous depositor removing his investment is the problem. The problem with a run on the bank is that the bank was insolvent to begin with.

On our side, we know the US is not solvent. We know the $20 trillion national debt will never be paid. We know the demographics and entitlements schedules are a ticking time bomb. We know the government is only growing, while productivity is decreasing. We know that medical care is becoming unfeasible in its cost and that college and student loans are a big bubble waiting to burst. It is easy to be lulled into complacency. We look around and everything is fine. Everyone is still going to work. Everyone is driving nice cars. Everything is okay. I would really urge people to consider that it is not okay. That the critiques of our situation aren't some academic wrangling, but an impending crash that we cannot avoid, and will probably be worse the longer it takes to arrive. Let's think of of the whole thing as a matter of resources. Our society is flush with resources. There is a lot of money, a lot of food, a lot of oil. Humans have never had so much. Not only does our society have a lot of resources, but if operates on the assumption that there will always be more. We put our retirement into stocks knowing they will grow with the economy. We get mortgages for our homes knowing their values and our own incomes can only increase. When we invest, we are not taking ownership of something tangible, like industrial capital. To some extent we are, but what we are really doing is betting on the future economy. If I have$1000, I can purchase resources, say food, or perhaps a plot of land to grow food, or I can do what most people do (if they even have any extra money) and invest it. That \$1000 I give to the stock market yields me no resources, but I have the promise that I will one day convert that investment into more resources than I could have originally extracted.

So what we know as wealth does not equate to resources. For most people, their wealth is not substantiated by resources, but by the promise of future resources. And as long as there is reason to believe there will always be more resources, always economic growth, then everything is fine. But what if economic growth doesn't happen? What happens just if people believe that economic growth will not happen? When that time arrives, people will do the logical thing. They will take their investments (their bets on economic growth), and they will convert them back to tangible resources. As investments are cashed out, the remaining investments lose their value, as result of demand economics, and even more people will be prompted to remove their investments. This is a classic run on the bank type of scenario. If most of your wealth is tied up in financial products looking for the greatest return, you are at risk of this type of scenario. When it happens, if you end up on your ass, you will have only yourself to blame.

We no longer live in magical growth land. The chance of a run on investments is real, and if you are not insured against calamity, you are just as at risk as the guy who lives next to a river with no flood insurance. You are simply irresponsible at this point if you don't take out a 3-step economic crisis insurance plan, as follows.
1. You should have tangible resources available to you. I can't tell you what to have available (gold, guns, and food is standard among the collapse minded), so you need to ask yourself one question: if all my investments disappeared overnight, could I survive with what I have on hand? If you aren't sure the answer is yes, you have work to do.
2. If a run on investments occurs, you need to recognize it, and convert your investments to resources before none are left. Just by reading this post, you have a much greater ability to beat the pack than most people. But most people will get nothing at all.
3. You must know how you'll generate and defend resources. This is about education and psychological preparation as much as anything. Many people will lose their minds if they lose their wealth. They will become entirely paralyzed when faced with true physical hardship, let alone risk to survival. Don't be one of them. If you've have time to accept that bad times are possible, even inevitable, you will be so much further ahead than those suddenly having their little bubbles popped.
There are two extreme types of reactions to collapse. On the one hand you have the crazed survivalist, who is ready to head to the woods at a moment's notice, whose whole life is centered on the coming collapse. On the other hand, you have the delusional city-dwelling investor who aggressively maximizes returns and doesn't understand the risks of doing so. Be in the middle. Think of it as taking out an insurance policy. Yes, it will cost you some, but you reduce your risk exposure to the coming and inevitable collapse. Cheers.

### The Left is Unprincipled

I used to think that liberals stood for something, and conservatives were defined by being against whatever liberals were asking for. In this viewpoint, liberals have a relatively clear agenda: they were for environmental regulation, for animal rights, for LGBTQQXR;πr² rights. They were for taxation and social programs, and all the things we would call the liberal agenda. On the other had, conservatives didn't really stand for anything in particular, but only resisted the changes being pushed upon them.

However, I'm now convinced that conservatives are the pro crowd, and liberals are the antis. Conservatives are pro-family, pro-constitution, and pro-Christian values. They are very familiar with what aspects of society they wish to preserve. The liberals don't have a rational agenda or clear vision for the world, so much as they are against what they see as an evil tradition. They are anti-conservative. They don't define themselves, they merely form up in opposition of the conservatives. Whether the dynamic itself has changed, or merely my viewpoint of things has changed, is uncertain. But I think it is both.

Here's an example that illustrates my point, and thinking about it prompted me to write this post. Liberals were once opposed to the EU. They saw the EU as just a consolidation of power for the old European order. Today, the right-wing have turned completely against the EU. The immigration crisis has demonstrated just how much national sovereignty they have lost, and they have mobilized and now Britain has voted to leave the EU. And the lefties are going nuts. Really foaming at the mouth, calling all the leave voters racists, bigots, morons, and much worse. The mainstream has been openly racist against whites, openly biased against older people; really no amount of hatred is being shied away from in their denigration of the vote.

But they used to be against the EU. Supposedly they were principled, but once the conservatives got on board, the lefties now are utterly certain that the EU is the greatest institution ever, and always has been. Why? Because they are unprincipled. They can only stand opposed to others. This goes a long way to explaining why most liberals can't rationally argue their support for the EU! They have no principles!! You cannot have a logical system with no axioms. It's no wonder that what they put forth as "argument" is almost invariably a mush of emotional string-pulling, ad hominen invectives, and rambling straw man arguments. That would simply have to be the result. They are only equipped to attack (because they are anti, no pro), and even those attacks are a sort of primitive clamoring that sidestep almost any notion of empiricism. (Some put forth the appearance of empiricism, but it is generally very shallow or misleading venture, such as a a link to biased "sources" like Politifact.)

So the right is pro, the left is anti, and yet I feel something has been omitted. What of us who only became conservative because we are anti ourselves. For instance, I only finally became a full-on conservative in response to (1) the immigration crisis in Europe, and (2) the lefty student coup that occurred at my state's flagship public university, Mizzou. So I am actually a reactionary myself. The left is a reaction to the right, but another group, usually called the Alt Right, is a reaction to the liberals after we've seen just what they are leading us to.

So does our right-side reactionary viewpoint suffer the same shortage of axioms that now define the left? Intuitively I say it does not. I have been very surprised at the level of logical discourse and intellectualism that occurs at the alt right. Surely there must be some axiomatic underpinnings, and yet we are inherently reactionary. Is this a contradiction? Have we merely adopted the axioms of the conservatives in response to the left? I will explore this some more in a later post.

Ignoring the alt right for the moment, the conclusion stands that the left are merely reacting against tradition, and that largely explains the desperate shrill shrieking, the hate-filled rhetoric, and the almost complete lack of rationale being emitted by the left in response to Brexit. I feel like if tomorrow the conservatives all united in their support of gay marriage, and became very vocal in promoting it, the liberals would flip their position, and claim that marriage was a way of imposing old control structures or moralities on homosexuals. Pay attention from now on when you see a liberal stance on any issue. Ask yourself, is this a genuine concern, or does it seem to be merely another anti-conservative reaction?

## Tuesday, June 7, 2016

### Universal Basic Income

Someone asked my thoughts on this article, so here are my thoughts on it.

The article, titled Why do the Poor Make Such Poor Decisions, suggests that a person in poverty is likely to exhibit worse behavior than if he wasn't in poverty. The example used to support the claim is a tribe of Cherokee with a very high poverty rate. Once a casino was built, greats sums of money were made available to the tribe. Many families incomes were significantly increased, and observed levels of degenerate behavior in the school children was observed to decrease. The conclusion is that the Cherokee example proves that a universal basic income is a good solution to address the issues with poverty in America.

First off, I do agree that the results of the Cherokee example reflect a generality. I agree with the premise that people who are desperate or humiliated by their circumstances will tend to act in an asocial way. Reducing crime and other undesirable behavior by reduction of poverty is a worthy approach. However, the Cherokee example cannot be extrapolated to larger US society. It is unique for two reasons.

1. Universal basic income is redistributive

Providing basic income to all citizens is ultimately a redistribution of wealth from the rich to the poor. Now it may be that the improved societal behavior of the underclass is worth taking money from the rich. Or, it may be that taking money from the rich, who are typically the most productive members of society and invest their wealth in the most productive ventures, is not worth the improved behavior because it tends to shrink overall wealth in the nation in the long term. Which logic is correct is circumstantial and not easy to answer. The difference of opinion on the matter is one of the core divisions between liberal and conservative viewpoints in America.

In either case, the Cherokee example does not possess the same redistributive characteristic. The money for the poor was not taken from rich Indians. It was from an entirely new and massive source of wealth coming from the outside. For the equivalent situation in the US as a whole, we would need many trillions of extra dollars per year in extra wealth from benevolent outside source. It would have to be aliens.

2. The Cherokee are a tribe, America is not

There are often cases where socialist successes in other places are used as shining examples of how things should work in America. Bernie Sanders has had great success in proclaiming that America needs to be more like Venezuela (hopefully he's stopped saying that) or Scandinavia. Always the socialist utopias are small nations, that are ethnically, culturally, and politically homogenous (relatively). Bernie Sanders thinks that America should be more like Denmark. But Denmark is roughly the size and population of Maryland, and it is populated almost entirely (until so recently) of Danish people, who share the Scandinavian worth ethic and are all social democrats to some degree. It is the quintessential high-trust society. In a high-trust society, you can leave your door unlocked, let your children roam, and give to those who are down, because you know the world is not fair, that the other person works just as hard as you, and it may only be a matter of fate that fortunes are not flipped.

America was at one time a high-trust society but that is no longer so. At least not in the cities, where most people live. And as America becomes more multicultural, and less willing to assimilate migrants, we move closer and closer to the low-trust extreme. It's a contradiction of liberalism that their goal of multiculturalism is directly at odds with the goal of socialism. Socialism only works in a high-trust society.

It may be possible for the Cherokee to spread the wealth among the people. The share an ethnicity, a culture, and common sense of purpose. There is a recent effort out of the Bay Area to provide basic universal income to the underclass in Oakland. It's a bit of an experiment, really. But the reality is this: the successful whites and east Asians in the area will be funding the survival of the impoverished blacks. Whether those paying the heavy tax load will accept this indefinitely, or end up moving to a lower-tax areas, is ultimately the question. Will the talent that has flocked to Silicon Valley in recent decades continue do so, when they are facing an increasing tax burden in what is already the highest cost of living in the US? No, and in fact they're already leaving for places like Seattle and Portland. The redistribution from rich to poor will only work as long as enough rich people stick around.