Did you know you owe $27,000, mostly to the government of China? Oops, now it’s 27-1….27-2….okay, it’s not going up that fast, but you get the picture—all that stuff we’re buying from China—they’re loaning us the money to buy it—at a nice, profitable rate of interest—and those dollars we’re using to pay them back are losing value as the debt mounts. Kinda like one of those dream sequences where if you could only move fast enough to get away from the monster…but you can’t, and then you wake up, eyes wide, heart pounding, safe in your bed.
But that appears to be where the metaphor breaks down, because as far as I can tell we are already as awake as we’re gonna get and we will not wake up safe and warm in our beds as the monstrous debt burden created by our government and the business interests it serves crashes down on us, destroying the economy and culture we have known all our lives. The old boys in charge know exactly what’s happening. That’s why they’re working so hard to pad their own nests. They figure there’s only so much to go around, it ain’t enough for everybody, and they’re by-God gonna make sure they get theirs.
So, given that we can’t wake up from this nightmare, what can we do? We have to become as fully conscious of what is happening as we can, and perhaps this will permit us to take charge at least of how we and the people we love fare in the so-far slow-motion collapse of the American way of life.
Here’s some numbers about what’s going on:
Three billion dollars a day—three billion dollars a day—is being spent on interest payments in this country. Aw, c’mon, that’s only ten bucks per person per day—but, gee, that’s $3,650 per person per year. In interest payments. Mortgages, credit cards, car loans, the whole juggled edifice of consumer financing that gives the economy the superficial sheen of health. And that’s on top of the money you owe the Chinese.
Another number: $834 billion dollars was borrowed against mortgages last year alone. That’s $2800 per person racked up in just one year—again, in addition to the per capita share of overseas debt. If the cash flow dries up, the only security a lot of people will have will be that the default will be so massive that the banks won’t know what to do with all the property they could foreclose—but they might take it anyway. When the Soviet Union crashed and burned, most people lived in state-owned housing and just kept living in it, even if they couldn’t pay the rent. We may not be so lucky over here.
Third, a pair of ratios: 42 to 1, and 431 to 1. The first number is the ratio between average CEO salaries and average worker salaries in 1980. 42 to one. The second is the ratio between average CEO salaries and average worker salaries in 2006. 431 to one.
In 1980, the top 1% of income earners collectively earned 9.3% of the nation’s income; today that number is14.3%. The wealthiest 20% of the American public earned 45.5% of the income twenty-six years ago; today they control 52.2%. In a world where money talks and votes, that’s a working majority. And the rising tide did not lift all boats. Income share for the remaining 80% of us dropped during that period. If the minimum wage had followed executive salaries, it would be $23 an hour; if average wages had followed the executive lead, the average American would be earning over a hundred thousand dollars a year. The irony is that many of those who are doing that well think they are average Americans. They are not. They are the American aristocracy, as out of touch with reality as the French nobles who played at milking cows and tending gardens before the French Revolution.
If only the American aristocracy were grounded enough to be learning to milk cows and grow gardens! For the most part they are not. They are as firmly hypnotized by the American myth as the lowliest NASCAR or American Idol devotee, ordering their lives as if they will always have access to plenty of home heating oil, gasoline, electricity, food and money.
The reality is that a storm cloud is gathering on the horizon that will blow America’s state religion of materialistic consumerism right out of the water. See, that’s what you do about monsters in dreams—you create a bigger monster to fight the one that’s chasing you—but wait, wasn’t that storm cloud on the horizon the slow-motion monster that was chasing us to begin with?
Well, that’s the thing about monsters in your dreams—they’re unacknowledged parts of yourself that, when you embrace and accept them, turn out to be your biggest unacknowledged strengths.
This metaphor is still tricky—how is the impending collapse of the American economy going to turn into an unacknowledged asset?
What’s so great about dollars being worth less and everything costing more?
What’s so great about the collapse of consumer culture? Shopping malls going out of business? No more new subdivisions? No more new highways? Spotty maintenance on the highways we’ve got, leading to their collapse? The end of widespread intercity trucking? Being forced by circumstances to rely on our friends, neighbors and fellow townspeople for our needs? Hmm…the upside of the downturn? Hmm…having no money for gas is one way to cut carbon emissions, eh?
And if the US collapses, what will the Chinese do about all the money we owe them? Will they try and seize our wide open spaces for resources and lebensraum? Will our default slow their growth? Worldwatch Institute projects that, at its current rate of expansion, China will soon use more automobiles than currently exist and more oil—and paper—than is currently produced. They may be able to produce millions of new automobiles, but enough fuel for them, and enough paper to write out the owners’ manuals, will not happen unless there are some as yet unforeseen breakthroughs in technology.
Astronomers warn that China’s current airline expansion plans, along with other air route expansions currently planned, will put enough water vapor in the air to end ground-based astronomy—and make the planet cloudy enough to cut into the efficiency of solar collectors.
The Chinese are positioning themselves for world hegemony, and history is on their side at this point in the game. They are the world’s major source of development capital. When England ruled the world, London was the main source of development capital. And the United States is no longer the world’s main source of development capital. We are the world’s major debtor nation, and it’s tough to order people—or countries—around when you owe them lots of money. That’s what US diplomats, from Condoleeza Rice on down, have been finding out lately.
The Chinese have partnered up with Russia and the former Russian republics in central Asia to form what is called “The Shanghai Co-operation Organization,” which is intended to function like NATO in some ways and the EU in others, co-ordinating the member nations’ activities at many levels, They have invited Iran, India, and Pakistan to join. The US asked for observer status, and was turned down. They’re having a party, and we can’t come.
This is the much-feared counterweight to US world hegemony, and we can’t push them around. We can’t push them around financially because we owe them money and they have oil and factory capacity that we don’t have any more. We can’t push them around militarily because even if our army wasn’t bogged down in Iraq they’re just too darn big for us to threaten. They are not “democratic,” either in reality or in the eyes of the Bush administration, and they have so far been efficient in suppressing those of their citizens who would like a more open society. They are the wave of the future and they’re not a workers’ paradise. They’re just a more efficient autocracy than this country.
They are, however, ecological hellholes. History may be on their side, but the planet is not. Global warming is bringing increasing desertification to central Asia, and may dry out much of China, India, and the former Soviet Union in a matter of decades. Already most of China’s major cities are facing critical water shortages. The 2008 Beijing Olympics may be canceled due to sandstorms.
So…what to do about this? Hunker down, buddy up. Stay out of debt or get out of debt. (Yeah, I know, we can’t do much about the debt the government’s running up for us.) Vote for honest politicians when you can find them, even if you don’t think they’ve got a prayer of getting elected. Plan for long term local self-sufficiency, and cultivate a sense of humor. You’re probably going to need it.