The Scenic Route to Hell
by Jeff Thomas
I rarely comment on specific news items, as I tend to focus on the long view. However, I’ve been repeatedly asked to comment on the recent American presidential election and what a win by Donald Trump will mean.
Of course, those who read this publication are rarely liberals in the modern sense. Many are conservative, but the majority are likely to be libertarians. Those from the latter two groups may well be singing, “Ding-dong, the witch is dead” at present, but this will not be the case.
Mrs. Clinton and her fellow globalists are not about to shrink back into the night.
Already the mighty hand of George Soros is visible on the East and West coasts of the US, in the form of massive demonstrations and, in some cases, riots from the “Not my president” crowd. This is a setback for them, not an endgame.
At the same time, of course, a quieter group – those who supported Mister Trump – are hoping that all will be right with the world in future. They will be anticipating a stemming of the migration tide from Mexico and the Middle East. They’ll be hoping to see companies located in the US to increase hiring and those that have left the US due to excessive corporate tax returning. They may also be anticipating a diminished national debt and an overall return to prosperity.
They will be disappointed.
Mister Trump has never been a conservative of the traditional school. He’s more of the modern school, which translates roughly to “collectivism lite.” His solution for exiting businesses is not diminished taxation, but trade embargos (check the Hawley–Smoot Tariff of 1930 to see how well that will turn out). He doesn’t wish to do away with socialized medicine, only to scrap Obamacare and replace it with “Obamacare lite.” (Government will still be the driver of the system, not the private sector.)
He supports mandatory social programmes like Medicare, Medicaid, Social Security, etc., that gobble up 67 percent of government expenditure, even though they have reached the point that they are not only unfunded but unfundable.
In addition, he has promised to rebuild the country’s aging infrastructure, expand the military, ramp up aggression against ISIS and bomb oilfields controlled by the Islamic State.
Mister Trump has, however, stated that he will diminish direct taxation. The highest earners would pay 33 percent and the corporate tax rate would drop to 15 percent. Yet, he offers no explanation as to how he will make up for the shortfall. Nor does he explain how he will deal with the mushrooming national debt.
What this tells us is that, despite the euphoria that is presently being felt by Mister Trump’s supporters, the fundamentals that plague the US economy remain present and not only is it impossible for him to reverse the pre-existent slide toward economic collapse, it’s not really even a part of the agenda.
Under Mister Trump, the US will still see inflation for the US dollar and larger deficits.
At the same time, we’re approaching a wave of corporate debt default for the record books.
The huge volume of junk bonds that were issued in recent years will begin to come to maturity in 2017. 2018 will be more severe and 2019 worse still. Highly leveraged companies will go belly-up.
National debt, corporate debt and personal debt are peaking and there will be nowhere to turn for a meaningful bailout. Although there will be quantitative easing and confiscation of private wealth in the coming years, no president, either liberal or conservative, can stop the debt bulldozer that’s now rumbling down the street.
None of this is to say that there may not be significant benefits to a Trump presidency. He’s likely to take a less collectivist approach, will diminish taxation and most importantly, will be less likely to take the US into another world war. This fact alone is reason to be grateful for his ascendancy.
But, regardless of who won the American presidential election, market collapses, debt defaults and an eventual currency collapse were baked in the cake. It’s safe to say that, should they occur in the next four years, as would seem likely, they would be blamed on the president, as they would happen on his watch.
This being the case, in addition to the fact that conservative thinkers are aging and being replaced by collectivists, it’s very likely that the US is looking at its last Republican president.
For those who oppose collectivism, the future may look a bit more promising after the recent election, but the outcome will be essentially the same. On the road trip into the future, the scenery may be a bit more palatable than it would have been had Mrs. Clinton been elected, but the fundamental outcome will be the same.
Those who recognize this fact stand a chance to fare better than those who don’t. They will have a brief time to prepare for the inevitability of coming events.