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oftwominds-Charles Hugh Smith: How to Make a Million: Extortion Creates its own Antidote

oftwominds-Charles Hugh Smith: How to Make a Million: Extortion Creates its own Antidote.

The problem is its own solution. Whether we try to stop the Status Quo, or let it stop, it WILL stop.

Longtime correspondent Eric A. has a new essay describing a key dynamic of the years ahead: Extortion and skimming create their own antidotes. As the costs of skimming, extortion and corruption reach new heights, the savings to be gained by bypassing the Status Quo systems also increase.

Here are a few of Eric’s previous essays:

A Brief History of Cycles and Time, Part 1 (May 13, 2013)

A Brief History of Cycles and Time, Part 2 (May 14, 2013)

Generation X: An Inconvenient Era (May 23, 2013)

The essence of my key analytic concepts, neofeudalism and neocolonialism, is that debt and other state-cartel schemes enclose and imprison the bottom 90% while leaving the illusions of liberty, democracy and “prosperity” intact so the debt-serf inhabitants of the home-country neocolonial plantations love their servitude.

Eric’s point is that the incentives to escape the home-country plantation are rising in parallel with the skimming of the state-cartel Elites.

Here’s is Eric’s provocatively insightful essay:


Concerning the Middleman-Skimming Economy, I’m here to tell you, it’s not all bad! The oppressive system you describe of graft, fraud, theft, and extortion creates its own antidote.
Banking, for instance. Problem: they have created an enormous skimming operation, and one that puts users at personal and financial risk, as well as annoying the heck out of customers for no reason. But that means the problem, stated simply is, “they make too much money.”

But that means that ANY ONE who goes around them in ANY WAY, has enormous payoff. Also creating a solution, like micro-loans, digital clearing, etc, has enormous incentive.

Simply put, so long as the out-sized pay exists, the out-sized incentive to avoid them, ignore them, go around them, re-think them, will always exist. Every minute, to every participant. So they’re really creating the solution as fast as they can.

Same with these other issues. Health Care? The kickoff of ACA (Affordable Care Act, a.k.a. ObamaCare) was the starting gun for cash-only medical care which until now only lived in the slimmest shadows. Since basically the co-pay alone is more than paying in cash–and the entire premium is 110% of direct welfare to the health lobby (a business model usually called “extortion”)– there’s no possible incentive not to ignore the system entirely and pay cash. The penalty would have to be 2x, 3x, 5x higher to come anywhere near tipping the balance. And thanks to a decade of previous screwing, the young people don’t actually HAVE the money, so even if the penalty were raised, it would have no practical effect.

Although college, with their 3x more admins, paid 2x more is a clear example, it’s the same with military, government, all these. All we have to do to save 50%, 90% or more is ignore them and let them collapse.

What do you think Detroit is doing for their present residents? As far as I can tell, basically nothing–and that’s true for cities nationwide. All we have to do is tell them to cease existing, go bankrupt, for-the-love-of-God stop helping, and we’ll all save 50% of our money and scarcely have a lower level of service. I mean, you can hardly exceed abominable.

The NYC school system is a great example: something like 66% of students drop out, while many of the remainder are uneducated and illiterate. What possible harm would it be to close the school system and stop paying for it altogether? With rates that bad, basically only the students who would study at home and pass anyway are passing now. Teachers, administration, programs, are therefore measurably providing ZERO benefit over the baseline. So it’s easy to see that we can’t possibly do worse, BUT WE CAN SAVE 100% OF OUR MONEY.

That’s incentive. Especially when most of us haven’t got a nickel to spare. By demanding ALL THE THINGS, they have only destroyed themselves.

Unfortunately, they’ve taken most of us with them.

Just for anecdote, a friend of mine works for a group home. They had a resident with a 105-degree fever who had been to the E.R., but had returned as his heart was racing–a thing easily noticed by pre-nurses and healthcare-oriented staff.

This patient had chest pains as well, and although hard to quantify it was worrisome stuff. So they took him back to the E.R. and waited 2 hours to be seen because there were… wait for it… two patients that evening.

The doctor prescribed Motrin. … I didn’t skip over a part there, the doctor heard the healthcare employee say the patient had chest pains with an irregular heartbeat, refused to hear it, refused to examine, said they’d seen the patient yesterday and they had a cold. Yes, they’d been in already. Because they didn’t diagnose it the first time. The hospital then forgot to fill the prescription Motrin and issued an empty envelope, releasing the patient on a Sunday, presumably to DIE OF HEART ARRHYTHMIA, and/or fever, and/or whatever it was they might have had, which they didn’t know, because they never looked.

If we were in a log cabin, in 1820 Kentucky, and I spent 2 hours walking my sick Pa down to the neighboring cabin and said, “Well Billy-Joe, Pa’s been sick and now his heart sounds funny,” what do you think you would do? You’d probably say, “let me listen and see if you’re right.” We’ve descended below the level of instinctual primate behavior here, and are into some sub-basement reserved for PhD’s.

Doctors and mis-prescriptions are now a leading cause of death–26x more deadly than firearms, 800,000 vs. 30,000/yr.

Death by Medicine (Estimated Annual Mortality and Economic Cost of Medical Intervention)

Gun violence in the United States

Granted that as people see doctors when already ill, the numbers are not neatly comparable. However, medicine is considered “safe” or “exemplary”, we are encouraged to use it, while guns are often considered the standard for “unsafe” and “dangerous.” While many would die without medicine, this suggests the baseline is that 800,000/year would be saved by banning medicine altogether. In short: We’re doing it wrong. Considering we pay twice (on a per person basis) what other developed nations pay for care, net-net could we really do much worse by having no doctors or medicine whatsoever?

Not really an unusual case either. They tried to kill someone a few weeks earlier and a different patient that weekend. They have tried to kill family members several times. I’m sure most readers have a similar scare stories. But death by neglect is still fatal, the fault of just not giving a damn.

Surely I exaggerate?

800,000 people were statistically killed via paid-for quack science that incorrectly (and illegally) promoted statins in Europe.

Medicine Or Mass Murder? Guideline Based on Discredited Research May Have Caused 800,000 Deaths In Europe Over The Last 5 Years (Forbes)
The earlier paper demonstrated the potentially large and lethal consequences of the current European Society of Cardiology guideline recommending the liberal use of beta-blockers to protect the heart during surgery for people undergoing non cardiac surgery. There is, it has now become clear, a general lack of concern and response to evidence of scientific fraud and misconduct.

This was quickly followed by a few thousand probable deaths of blood clots due to a newer configuration of the Pill.

Have 800 women been killed by the Pill? The alarming dangers of taking so-called third generation contraceptives (Daily Mail, U.K.)

(Note that 800 deaths are only the U.K.) –Just two random articles in the last few days, probably hundreds of others with millions of deaths if I looked. The over 60,000 deaths from provably corrupt research authorizing Vioxx comes to mind.

I somehow feel that if I killed 800,000 people through fraud, abuse, or neglect, that the police would be –I don’t know– MAD at me or something. Or killed even one group home patient by refusing to lift a finger. There were once quite a number of laws concerning it: neglect, reckless endangerment, manslaughter–murder even.

But that’s so 20th Century. Consequences, I mean. Laws and enforcing them. Like so many, we’re now considering flying out of the country for healthcare, but unlike so many we don’t have money for 5-star hospital spas in Goa or Singapore. So we were thinking maybe the Belgian Congo for better medical care than rural NY. I hear they may have stethoscopes there.

THAT’S what I mean when I say you could close the whole system and have it be a measurable benefit to mankind.

The problem is its own solution. Whether we try to stop, or let it stop, it WILL stop.Because anything that can’t go on, won’t. When you’re at 100% costs and 0% benefits, congratulations, you’ve reached the Singularity.


Thank you, Eric, for an insightful look at the benefits of bypassing or ignoring the Status Quo systems, and the benefits that will accrue from their inevitable collapse. The idea that the next arrangement will be better, cheaper, more equitable and sustainable is not yet dominant, but that doesn’t mean it isn’t true.

oftwominds-Charles Hugh Smith: Pimping the Empire, Progressive-Style

oftwominds-Charles Hugh Smith: Pimping the Empire, Progressive-Style.

Supporting the central state to protect your favored cartels is simply pimping for the Empire.

The central illusion of both Left (so-called Progressives) and Right (so-called conservatives) is that the Central State’s essentially unlimited powers can be narrowly directed to further their agenda.

(I say “so-called” because the “Progressives” are not actually progressive, and the “Conservatives” are not actually conservative. Those labels are Orwellian double-speak, designed to mask the disastrous consequences of each ideology’s actual policies.)

Let’s begin by stipulating that ideology, any ideology, is an intellectual and emotional shortcut that offers believers ready-made explanations, goals, narratives and enemies without any difficult, time-consuming analysis, study or skeptical inquiry. This is the ultimate appeal of ideology: accepting the ideology relieves the believer of the burdens of analysis, skeptical inquiry, uncertainty/doubt and responsibility: all the answers, goals and narratives are prepackaged and mashed together for easy consumption.

This is one of the core messages of Erich Fromm’s classic exploration of ideology and authoritarianism, Escape from Freedom.

And what is the essential foundation of authoritarianism? A central state. This is not coincidental.

What few grasp is the teleology of the centralized state: by its very nature (i.e. as a consequence of its essentially unlimited powers), the central state is genetically programmed to become an authoritarian state devoted to self-preservation and the extension of its reach and power.

The central illusion of Progressives is that an all-powerful central state will not become a self-serving expansive empire, but will be content to wield its vast powers to protect its favored cartels/monopolies and distribute money skimmed from the citizenry to Progressive constituencies such as public unions, healthcare and education.

This is an absurd fantasy. Once you give a central state essentially unlimited power to stripmine income and wealth from its citizens, create and/or borrow essentially unlimited sums of money, protect private (and politically powerful) cartels from competition and project military, financial and diplomatic power around the globe, the state will pursue Authoritarianism and Empire as a consequence of possessing those powers.

You can’t cede unlimited, highly concentrated powers to the central state and then expect the state not to fulfill its teleogical imperative to protect and extend its powers. The state with unlimited powers will be ontologically predisposed to view any citizen that seeks to limit its expansion of power as an enemy to be suppressed, imprisoned or marginalized.

The state with unlimited powers will be ontologically predisposed to protecting its powers by cloaking all the important inner workings of the state behind a veil of secrecy, and pursuing and punishing any whistleblowers who reveal the corrupt, self-serving workings of the state.

The state with unlimited powers will be ontologically predisposed to view any other nation or alliance as a potential threat, and thus the state will pursue any and all means to distrupt or counter those potential threats.

The state with unlimited powers will be ontologically predisposed to create and distribute propaganda to mask its self-serving nature and its perpetual agenda of extending its powers, lest some threat arise that limits those powers.

Democracy and a central state with unlimited powers are teleologically incompatible.

Progressives worship the central state and cede it essentially unlimited powers because they want that state to be powerful enough to impose their agenda on others and reward their constituencies.

But it doesn’t work that way. Once you cede unlimited, highly concentrated power to the central state, you get an authoritarian empire that is driven to protect itself from any threat at all costs–including democracy, though the state may maintain a facade of carefully managed “democracy” as part of its propaganda machinery.

You cannot have a state with essentially unlimited power and not end up with cartel-capitalism. So-called Progressives defend their favored cartel-fiefdoms of healthcare and education (and the “conservative” banking and defense cartels, too, to insure banks fund their campaigns and to protect their political flank with a “strong on defense” carte blanche to the National Security cartels), yet these cartels are busy bankrupting the nation and destroying the very programs Progressives claim to hold dear.

You can’t have it both ways, Progressives: if you support a central state with essentially unlimited power to protect and fund your constituent cartels, you end up with self-liquidating cartel-capitalism, a state bent on protecting itself from the uncertainties/risks of democracy and a global Empire that is teleologically driven to expand its reach and power by any and all means available.

Once you choose to cede essentially unlimited powers to the central state, all decisions after that are made in service of the state. The idea that the state can be limited to helping the needy is illusory.

The only legitimate duties of the state are limited: 1) protect the commons from destruction and exploitation; 2) protect the citizenry from exploitation or oppression by those with superior power or resources; 3) maintain transparency in all governance and 4) maintain a system of sound money.

The so-called Progressives will learn what the teleology of the state means in the real world when the state comes after them. Once you cede unlimited power to the central state, any attempt to limit that power marks you as an enemy.

War at Home: Covert action against U.S. activists.

Supporting the central state to protect your favored cartels and protect your political power over the state’s tax revenues is simply pimping for the Empire. You can call it “progressive,” but it’s still pimping for the Empire.

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