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The End Of An Empire And The Beginning Of A Depression

The American Dream
April 16, 2011

Since the end of World War 2, the United States has been the leading military power and the leading economic power on the entire globe.  The U.S. has had the largest economy in the history of the world, the U.S. dollar has been used by nearly all of the nations on earth as a reserve currency and the U.S. military has had a physical presence in most of the countries on the planet.  Today, the U.S. military is in approximately 130 different nations and it has a total of about 700 military bases around the world.  But just like the Roman Empire, the U.S. empire has become overextended and it is starting to decline.  Most of our politicians believe that we can continue to “police the world” and project our power to every corner of the globe, but the more we meddle the more the rest of the world hates us and the worse our financial problems get.  America is now swamped with debts and our influence is fading.  The truth is that what we are witnessing is the end of an empire and the beginning of a depression.

Over the past decade, the wars in Iraq and Afghanistan have cost U.S. taxpayerswell over a trillion dollars.

So what have we gotten in return for a trillion dollars?

In Afghanistan, we haven’t even found the one man we supposedly went there to look for – Osama Bin Laden.  It defies comprehension how a man with a really bad kidney disease can hide in caves and evade the most powerful military on earth for nearly a decade.

But at least we got rid of the Taliban and set up a good form of government, right?

Oh yeah, we set up a really wonderful government.  For example, they recently arrested a one-legged Afghan Red Cross worker and sentenced him to death for converting to Christianity.

Fortunately there was enough of an international outcry that Said Musa was not hung, but the fact that the Afghan government wanted to string him up is enough to show that we have completely failed over there.

The same thing is true in Iraq.  Yeah, we may have gotten rid of Saddam, but the nation is now in far worse shape than before we went in.

Before the war Christians felt safe in Iraq.  Now large numbers of them are fleeing Iraq as fast as they can.  More than 80 Iraqi Christians were recently beheaded on a single day.  All the Christians were trying to do was attend a church service.

Now we are involved in a third war in the Middle East.  Even though Libya was no threat to the United States, Obama felt compelled to stick our nose into a chaotic civil war.

Now it looks like our involvement in Libya could last for a very, very long time.

In a joint op-ed piece in the New York Times, Barack Obama, David Cameron and Nicolas Sarkozy declared that NATO military operations in Libya will not end until there is a regime change….

However, so long as Qaddafi is in power, NATO must maintain its operations so that civilians remain protected and the pressure on the regime builds. Then a genuine transition from dictatorship to an inclusive constitutional process can really begin, led by a new generation of leaders. In order for that transition to succeed, Qaddafi must go and go for good.

So exactly who are we “helping” in Libya?

It turns out that we are providing “air cover” for many of the same people who were shooting at our troops in Iraq.

Yes, you read the correctly.

According to The Telegraph, the leader of the Libyan rebels is even admitting that his “troops” include jihadists that were firing bullets at U.S. troops in Iraq….

Abdel-Hakim al-Hasidi, the Libyan rebel leader, has said jihadists who fought against allied troops in Iraq are on the front lines of the battle against Muammar Gaddafi’s regime.


What type of government do you think they are going to set up once this is over?

And all of this meddling is turning the rest of the world against us in a big way.

Most Americans don’t realize just how much hatred there is for America in the rest of the world.  There are millions upon millions of people out there that now hate us with every fiber of their beings, and every time we bomb someone else world opinion turns against us even more.

Sadly, our meddling goes well beyond the three wars we are currently fighting.  The truth is that the U.S. military is actively “conducting operations” in dozens of different countries.

For example, most Americans don’t even realize what the U.S. is doing in Pakistan.

How would you like it if a foreign power was conducting missile attacks inside the United States over the objections of our national leaders?

Well, that is what we are doing in Pakistan and we are going to continue even though Pakistani officials are adamantly objecting.

According to AFP, the CIA intends to continue conducting operations in Pakistan no matter what the Pakistani government says….

The Central Intelligence Agency has no plans to suspend “operations” in Pakistan against terror suspects despite objections from leaders in Islamabad, a US official said Thursday.

This approach to foreign policy is absolutely foolish.  Attempting to have an “iron grip” on the rest of the world is only going to cause the rest of the world to deeply hate us and deeply resent us.  We like to think of ourselves as “do gooders” but most of the rest of the world considers us to be tyrannical.  Eventually the rest of the world will lash out at us.

In addition, maintaining our vast empire is bankrupting us.

As I have written about previously, U.S. military spending is wildly out of control.  The truth is that U.S. military spending is greater than the military spending of China, Russia, Japan, India, and the rest of NATO combined.

The United States already accounts for 46.5% of all military spending in the world.  China is next with only 6.6%.

Just one day of the war in Afghanistan costs more money than it took to build the entire Pentagon.

So will reducing military spending solve all of our financial problems?

Of course not.

In fact, if you eliminated every penny of military spending we would still have a gigantic budget deficit.

And that is another reason why our empire is dying.

The United States has the biggest debt problem in the history of the world.

Right now the U.S. government is over 14 trillion dollars in debt.  Our debt is increasing by over 2 million dollars every single minute.

Our politicians are running up the national credit card as if there will never be any consequences.

But a very serious day of reckoning is coming, and when it arrives the rest of the world is not going to be in the mood to help us.

It is being projected that by 2021, the U.S. will be paying $1.1 trillion a year just in interest on the national debt.

So how big is a trillion dollars?

Well, if you were alive when Jesus was born and you spent a million dollars every single day since then, you still would not have spent a trillion dollars by now.

Our national debt is now at a tipping point.  A recently revised IMF policy paper entitled “An Analysis of U.S. Fiscal and Generational Imbalances: Who Will Pay and How?” projects that U.S. government debt will rise to about 400 percent of GDP by the year 2050.

So what are our politicians doing about it?

Nothing.

During the last election, the Republicans made a “pledge” to the American people to cut $100 billion from the 2011 budget if they were elected.

Then once they got in they told us that $61 billion would be enough.

Then John Boehner gave in and agreed to cut the 2011 budget by only $38.5 billion.

Well, now it turns out that even the $38.5 billion figure was not even real.

According to the Congressional Budget Office, the “budget deal” will only slash $352 million (with an “m”) from the 2011 budget.

That is less than one percent of the $38.5 billion figure that was announced.

No wonder so many Tea Party activists are now declaring that John Boehner must go.

In the end, our politicians do not intend to do anything about our runaway debt.

The Democrats will shut down the government rather than allow serious cuts to social programs or entitlements.

The Republicans will never allow serious cuts to the military and they are pushing for even more tax cuts.

So how in the world is U.S. government debt ever going to be brought under control?

The sad news is that it is not going to be.  It is just a matter of time before a great U.S. debt crisis strikes.

But the U.S. is not the only one with a debt crisis.

The European debt crisis just seems to get worse with each passing month.  The bonds of several European nations have been significantly downgraded in recent weeks.

According to the Wall Street Journal, Moody’s actually downgraded Irish debt by two levels on Friday….

Moody’s Investors Service Inc. downgraded Ireland’s government debt by two notches Friday, taking the country to the brink of junk status, and kept its outlook negative.

Things are getting scary.

Bond yields all over Europe are going through the roof.

A year ago, the yield on 10-year Portuguese bonds was hovering around 5%.  On Friday it reached 9.0%.

A year ago, the yield on 10-year Irish bonds was also generally in the neighborhood of 5%.  On Friday it closed at 9.7%.

But that is nothing compared to what is happening to Greek debt.  On Friday, the yield on 10-year Greek bonds skyrocketed to an astounding 13.83%.

Yes, a depression is getting a little bit closer every single day.

Things don’t look good in Asia either.  Prior to the recent tsunami, the Japanese economy was the third largest economy on the entire globe.

But there are now very serious questions about whether or not Japan will ever fully recover from what has just happened.

The mainstream media has been really downplaying the economic damage that has been done to Japan, but eventually the truth will become clear.  In a previous article, I contended that this was essentially a “death blow” for the Japanese economy….

The tsunami that struck Japan on March 11th swept up to 6 miles inland, destroying virtually everything in the way. Thousands upon thousands of Japanese were killed and entire cities were wiped off the map. Yes, Japan is a resilient nation, but exactly how does a nation that is already drowning in debt replace dozens of cities and towns that are suddenly gone? The truth is that thousands of square miles have been more completely destroyed than if they had been bombed by a foreign military force. The loss of homes, cars, businesses and personal wealth is almost unimaginable. It is going to take many years to rebuild the roads, bridges, rail systems, ports, power lines and water systems that were lost. Nobody is quite sure when the rolling blackouts are going to end, and nobody is quite sure when all of the damaged manufacturing facilities are going to be fully brought back online.

If all that wasn’t bad enough, the nuclear crisis at Fukushima just seems to get worse by the day.

According to the Los Angeles Times, seawater near the Fukushima nuclear complex was recently found to contain “iodine-131 at 7.5 million times the legal limit”.

Authorities in Japan recently upgraded the crisis at Fukushima to a “level 7″ nuclear disaster, and almost everyone is finally acknowledging that this crisis is as bad or worse than Chernobyl.

Many now fear that vast portions of northern Japan may end up beinguninhabitable after all this is over.  The health effects and the economic effects from this nightmare are going to be felt for the rest of our lives.

But even if all of the things above were not happening, the rapidly rising price of oil could potentially be enough to push the world into a depression.  The entire global economy is predicated on the ability to consume gigantic amounts of very cheap oil.  Nobody has ever been able to prove that the global economy can continue to function normally if the price of oil stays above $100 a barrel for an extended period of time.

When oil goes up, people start staying home.  Certain types of economic activity become unprofitable.  The cost of transporting all goods increases.  The amount of money being transferred out of the U.S. economy and into the hands of oil barons soars.

The average price of a gallon of gasoline in the United States is now $3.81.  It is about a dollar higher than it was at this time last year.

If the price of oil stays where it is right now, the global economy can probably handle it, at least for a while.  However, if it explodes up to $150 or $200 a barrel it is going to unleash hell on world financial markets.

The world is becoming a very unstable place.  The U.S. empire is crumbling and the global financial system is on the verge of a nightmare.

Hopefully the rest of 2011 will not be as eventful as the first part has.  We could use some global peace and stability for a while.  Unfortunately, that is probably not going to be the case.

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