Elon Musk & Trump's Economic Plan Risks Causing an Instant Depression

And you thought the jokes about Puerto Rico were bad!

This is an exchange on twitter / X between a right wing lunatic, “Fischerking” and Elon Musk, who has suggested he could find a way to cut $2-trillion out of the U.S. Budget and instantly balance the budget.

The idea that this will cause a rapid recovery is completely delusional, and based on a completely insane economic philosophy currently playing out in Argentina under the libertarian lunatic, Milei, which has seen poverty shoot up to over 50%.

It is essentially a plan to drive the U.S. into receivership and liquidate the economy. It is basically treating the entire government and economy of the U.S. as if it’s a meme stock.

In a recent interview, economist Stephanie Kelton, who is a proponent of modern monetary theory, stated what we should all recognize as self-evident: when the government runs a deficit to stimulate the economy through investment and spending, that deficit is all deposited in private bank accounts. (Conservative governments have taken to reverse-Keynesian policies, borrowing to finance unfunded tax cuts.)

The central problem of our current, mainstream economics is that they are all from a single point of view - the owner. While they talk all the time about balance, and deficits, and debt, they do not consider both sides of the ledger.

It is a statement of fact that all spending is someone’s income. Private spending as well as public spending. If you take $2-trillion out of the economy, that is $2-trillion that will not be circulating in the private economy. That’s called “a massive recession”.

It would have a seismic and devastating impact on the U.S. economy, which would then be followed by a tsunami of defaults, as people and businesses are tipped into bankruptcy. As millions are driven into bankruptcy, we should not for a moment think this will help individuals afford housing, because these properties can all now be snapped up by people of means.

That is a plan to drive people and American businesses into bankruptcy, driving down prices and wages so that companies can pay workers less, and so that billionaires can buy quality property at rock bottom prices.

It’s not $2-trillion plan for economic recovery - it’s a heist, and for a lot more than $2-trillion.

It has to be said, that if Vladimir Putin, Modi in India and Xi in China were to come up with an economic plan that would break America’s back as an act of financial warfare, this is what they would do. In this case, persuading the deluded and ignorant leaders of a country to commit economic suicide. This is also being driven by cryptocurrency lunatics like Peter Thiel who have a vested interest in cryptocurrency, and want their private cryptocurrency to become an international reserve currency, which is insane.

Sometimes you’ll hear liberals say “I’m a white guy, I’ll be fine, it’s the vulnerable we need to worry about,” still don’t get it. When these people say they want a revolution, they mean it, and their ideas are batshit crazy, which is why, when they get in charge and nothing works, they start killing people. So, you know what? Your privilege is not going to protect you. Quite the opposite, in fact.

This is practically a recipe to create the conditions for a civil war, by people who have been funding separatist movements in the U.S. and Canada.

It is absolutely insane that Elon Musk, the richest person in the world, whose technical achievements have all been financed by government - either funding Musk directly of funding the know-how and training for everything from rocket science to microchips and everything in between and beyond. Musk, who entered the U.S. illegally and is backing a president promising mass deportation - that Musk wants to impose brutal austerity on the American people because he’s too ignorant of actual macroeconomics to see past his own bias due to loss aversion.

In an interview, Elon Musk said Americans “must accept "temporary hardship" once Trump is elected.”

A “Cathy Young” on Twitter remarked that it

“Sounded much better in the original Russian as "временные трудности" (vremenniye trudnosti), i.e. temporary hardships. Literally Soviet propaganda language routinely used to explain why the workers' paradise had not yet arrived. (Those temporary hardships lasted 70 years btw).”

And this, to me, is one of the most enraging things about it. Musk is saying Americans must accept temporary hardship - but he won’t. This is not a shared sacrifice, and Musk sure as hell won’t feel the pinch.

There were times when people managed to keep society together in a crisis because there was shared sacrifice - dealing with shortages in war. Nowadays, it’s never shared sacrifice anymore: it’s human sacrifice, and it’s always being proposed always proposed by people who feel absolutely nothing.

Part of what marks all of these spacey, flakey tech billionaires whose products have all made things cheaper and nastier while not really ever having created anything new. Searches, shopping, sending money, advertising.

We’re currently living in a world where one of the major motivations of BRICS - Brazil, Russia, India China and South Africa, along with other countries - are actively seeking not just to set up an alternate payment system, but to collapse the existing U.S. dollar based system through espionage, financial warfare, military warfare, foreign interference and propaganda.

For all the people who ask “how could people believe or follow such-and-such a leader,” the reality is that we are all susceptible being credulous or gullible, including people who are wealthy and “sophisticated”

“Ricky Jay, the sleight-of-hand master, told 60 minutes that “the ideal audience would be Nobel Prize winners....They often have an ego with them that says, ‘I am really smart so I can’t be fooled.’ No one is easier to fool.””

The developed world - Canada, the U.S., the EU and the UK are all being targeted by the governments of China, Russia and India, in an effort to collapse our economies, divide NATO and cripple the military capability to respond in conflict.

Now, one of the reasons this is a real and credible threat is that these other countries recognize something about the way our economy runs, that mainstream economists in Europe, the U.S. and Canada do not.

They know that it is not government debt that collapses market economies.

It is private debt, and there are record amounts of private debt in the U.S. and especially in Canada.

So a loss of trillions of dollars to the U.S. economy would implode the economy, the deportations and social chaos, and the insane tax measures would leave the U.S. completely unable to fund anything - especially the military.

This sounds like a deliberate plan to do to the U.S. what the Vandals did to Rome - breaking the “tax spine” that made it possible for government to govern.

The final collapse of the Roman Empire - which was swift and happened in a mere two generations - was driven because the Vandal invasion of northern Africa “broke the ‘tax spine’ of the Empire.”

Unable to pay its soldiers, the military disbanded, and the Empire ceased to be.

To ACTUALLY save the economy, governments in developed countries like Canada. the US and Europe should be running high-pressure economies. To increase the size of the productive economy and shrink the size of the financial economy.

This is the goal and strategy of Ron Paul and the Christian right.

This is the goal of the far-right Christian libertarians supporting Ron Paul, who, it has to be said, are cranks when it comes to absolutely everything.

The destruction of the Federal Reserve and the U.S. defaulting is to rob “opponents” of their power by depriving them of access to money, and militias will sweep in to take secure power.

“Clarkson’s analysis of the Christian Right’s strategy focused on their efforts to gain power and control through the political system by exploiting ignorance of their goals and modus operandi as well as through subterfuge, chicanery, and stealth. His analysis did not extend to the role and function of the Patriot militia, nor did he consider their alternative route to power: the collapse of America’s economy and its concomitant loss of legitimacy. This part of the strategy has been followed since the 1980s and, as we shall see in this chapter, is the foundational strategy of the Tea Party movement that was devised by Gary North and implemented by Ron Paul. At the end of Chapter 17, William Lind’s strategic assessments for the Patriot militia highlighted the confluence of military defeats and economic collapse leading to a crisis of legitimacy.

These ideas are not only strategic assessments from Lind, but are consistent with Gary North’s early writings and even Howard Phillips’ own forecast of how the Christian Right would come to power. North is the Christian Right’s leading Christian libertarian economist who believes the Federal Reserve System is evil and the gold standard a panacea for all that ills American society.”

Gary North, it should be said, “believed that capital punishment is appropriate punishment for male homosexuality, adultery, blasphemy, abortion, and witchcraft.”

In other words, he is a deluded, superstitious nutcase, and an ignoramus about everything - the Bible and economics included. There is a reason and deep symbolism why Moses was disappointed when he found his people were worshipping a golden calf. Real calves are something living that will grow of their own accord, and may give back, milk, meat and more cattle. A golden calf is dead and sterile - as is all money.

As I have written elsewhere, Jesus’ lessons on economics are quite clear, and they are neither socialist nor are they capitalist. They do, however, show a keener appreciation than most present-day economists for the ways that the forces of debt can grow out of control.

Now, while people may revel in this as freedom or liberation - and heaven forbid I should be accused of being pro-Roman Empire - the reality is that when economic systems where negotiations that work on money collapse, if they are not replaced with another credible system that works on money, the result is chaos and brutality.

The commonly held idea is that taxes and costs of government are a “dead weight” that make the system less efficient, and that if all these costs could be eliminated, taxes would be unnecessary, is a fantasy that actually involves disssolving the entire superstructure of the economy that makes its functioning possible.

It also has to be said that human history is an incredibly miserable business, and the shock we experience reading about the corruption, sleaze, crimes and worse is partly that these things were kept from us as children, and also that in the past, it wasn’t always so bad.

The genuine history of the world is generally much worse and more unpleasant than we are led to believe. There are experiences whose pain can’t be articulated, and there are acts that are beyond human comprehension.

It also has to be said that austerity does not work and is monumentally dangerous.

In over 140 countries, a group of researchers studied what happened after financial crises - the answer was that the population got more polarized, more nationalistic and socialist at the same time. Major wars are almost always preceded by financial crises.

How Financial Collapses drive Extremism and War

This should be recognized for what it is: in a time of insecurity, people are clinging together for safety - but they’re like too many people rushing about on the surface of an unstable raft. When the only thing that is short is money, that is a policy mistake, not a reason for people to starve.

There is an attitude - or at least a stubborn lack of understanding - about how devastating a financial crisis can be. There is an attitude that it can’t possibly have been that bad.

In my piece on economic collapse always preceding wars, I wrote that Kindleberger notes

“some writers doubt that the disruption to money could really have harmed people, saying that “the economic and demographic catastrophe of the Thirty Years’ War is, if not a myth, at least exaggerated.” People closer to the events argued that when comparing the damage of war to the damage of money losing all its value, that the damage from the economic crisis was worse.

Historians closer to these events did make these arguments - that the economic catastrophe was worse than the Black Death. Following a coin clipping crisis that precipitated a market meltdown in England, required the coin to be reissued 1696, Macaulay wrote:

“Yet it may be doubted whether all the misery which has been inflicted on the English nation in a quarter century by bad Kings, bad Ministers, bad Parliaments and Bad Judges, was equal to the misery in a single year caused by bad crowns and shillings.”

In this, we also need to consider what trump advisor and strategist Steve Bannon has said. Bannon wants a revolution, and in an interview, Bannon said he was a Leninist.

Lenin, it should be remembered, did that while killing a lot of people as well.

Bannon, like many of Trump’s supporters, is no dummy. But he does have his history wrong. He wrongly believes that:

He sums up WWII as:  

“really the Judeo-Christian West versus atheists, right? The underlying principle is an enlightened form of capitalism, that capitalism really gave us the wherewithal. It kind of organized and built the materials needed to support, whether it’s the Soviet Union, England, the United States, and eventually to take back continental Europe and to beat back a barbaric empire in the Far East.” 

Of course, none of this makes sense. The Soviet Union, where religion was outlawed, ultimately joined with the Allies to defeat the Nazis, who were not atheists, and the whole thing was done and paid for by government. China was an ally against Japan. WWII came out of WWI - in which warring European states who were mostly white and Christian (of a wide number of denominations) slaughtered each other in the millions. 

Bannon continued.

“The underlying principle is an enlightened form of capitalism, that capitalism really gave us the wherewithal. It kind of organized and built the materials needed to support, whether it’s the Soviet Union, England, the United States, and eventually to take back continental Europe and to beat back a barbaric empire in the Far East.

That capitalism really generated tremendous wealth. And that wealth was really distributed among a middle class, a rising middle class, people who come from really working-class environments and created what we really call a Pax Americana. It was many, many years and decades of peace.”

This is all wrong. It certainly wasn’t capitalism alone that defeated Nazi Germany, it was governments and the military, including the USSR, which was definitely not capitalist.

The “great compression” that occurred between 1938 and 1945 in the U.S. and Canada due to the economic measures required to deal with the war were extraordinary.

Did private industry play a role in building the war machine for WWII? Of course. But it was ordered and paid for by the U.S. and other governments. The US ran a control economy, with wage and price controls. Food, fuel, coffee, sugar and rubber were all rationed, and every scrap of metal was recycled to be used strategically for the war effort. Unemployment went down to 2%, but while inflation was high, wages went up by 80% in just four years. By 1945, when the controls were lifted, the average American worker was saving 20% of their income.

To get an idea of the scale of investment during WWII, the private capital tool stock of the US was doubled, at government expense. Add to that investments in R & D and new technologies originally for military use- the jet engine, radar, electronics, computing,  nuclear and medical technologies, all of which were later commercialized.

The “Pax Americana” started with a decision on the part of the Allies not to repeat the mistake of the Treaty of Versailles and the First World War, when victors’ justice imposed terrible costs of reparations on Germany. John Maynard Keynes quit the Versailles negotiations with a warning the terms would start another war in twenty years - he was right.

The Allies launched a Marshall Plan to help Germany and Europe rebuild. The so-called “Golden Age of Capitalism” saw the highest growth the world has ever seen, between 1945 and 1975. It was defined not by laissez faire capitalism, but the welfare state and the “mixed economy.” Could GM have sold as many cars if governments weren’t building freeways and Interstate Highways in the 1950s?

In the 1970s, neoliberal, free-market, anti-government policies first took hold, and an alt-history of prosperity was developed instead. Think tanks, economists and politicians all railed that government can do only harm and that it has warped the free market and created all the ills in society - even poverty. But growth since 1980 has been worse than it was during the mixed economy.

Peter Thiel, who is on Trump’s transition team, wrote that the gilded age of the 1920s were the peak of “democratic capitalism,” which he argued has been in decline ever since, in part because women got the vote. Others, like the Koch brothers, look back on the 19th century robber barons as the peak for America. In this sense, economic libertarians and followers of Ayn Rand are like anti-vaxxers, but for democracy, the rule of law and reality-based finance.

What you need to understand about Elon Musk, Trump, Thiel and all the people around them, is that they don’t really understand the system they work in, and their actual plan is to pull the whole structure down on top of all of us, because they don’t actually know how to fix anything. As billionaires - and sometimes, as Americans - they are floating in a bubble of privilege where they can be continually and relentlessly wrong and it doesn’t make a difference - to them.

Their views are anti-everything - and not just anti-democracy, or anti-government, or human rights, anti-history, anti-economics, anti-reason, anti-science, they are also, fundamentally anti-Christian, because it ignores all of the actual economic lessons that are the core focus of Christ’s last days.

They are bad scholars of everything, especially the Bible, and their only real use for religious belief is to use it as a cudgel with which to abuse others.

There are plenty of people around the world who would cheer the United States no longer being an influence on the world stage, but this plan is a recipe to deliberately create desperation and deprivation that is worse than throwing a match into a room full of explosives, with no plan to deal with the aftermath.

The Trump campaign has strapped itself to a bomb with the intention of blowing up the U.S. Economy. They mean it. As the old saying goes, “When someone tells you who they are - believe it.”

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