I generally like Dimitry Orlov's outlook. He is more apocalyptic than I am, but his heart is in the right place. He thinks the West's Establishment is the Wizard of Oz. So do I. But let us not forget that the Wizard ran Oz without opposition for quite some time.
Orlov thinks we are getting close to the end of the movie, when the Wizard gets exposed. Recall that it was Toto who did it. Here is his latest article.
There are times when a loud cry of "The emperor has no clothes!" can be most copacetic. And so, let me point out something quite simple, yet very important.The old world order, to which we became accustomed over the course of the 1990s and the 2000s, its crises and its problems detailed in numerous authoritative publications on both sides of the Atlantic--it is no more. It is not out sick and it is not on vacation. It is deceased. It has passed on, gone to meet its maker, bought the farm, kicked the bucket and joined the crowd invisible. It is an ex-world order.
We're not there yet. That's because central banks still create counterfeit money to keep things going. But there are limits to this process. I just can't time it.
ORLOV ON THE USSR
He says that the USSR collapsed in a heap without warning, 1985-91.
If we rewind back to the early 1980s, we can easily remember how the USSR was still running half of Europe and exerting major influence on a sizable chunk of the world. World socialist revolution was still sputtering along, with pro-Soviet regimes coming in to power here and there in different parts of the globe, the chorus of their leaders' official pronouncements sounding more or less in unison. The leaders made their pilgrimages to Moscow as if it were Mecca, and they sent their promising young people there to learn how to do things the Soviet way. Soviet technology continued to make impressive advances: in the mid-1980s the Soviets launched into orbit a miracle of technology--the space station Mir, while Vega space probes were being dispatched to study Venus.
Soviet technology, outside of weaponry and rockets, was a joke. It was always mythological. From 1917 until 1970, at least 95% of Soviet technology was imported from the West: either stolen, imported, or built in the USSR by Western corporations. That was proved in the mid-1960's by Antony Sutton's path-breaking three-volume study, Soviet Technology and Economic Development. Also, three premiers died in rapid succession, leaving the Empire leaderless.
The 1980 Olympics revealed to the Soviet leadership that they were poorly dressed bumpkins when compared to the Western tourists who came to see the festivities. Despite all of their power, Soviet leaders could see that Western tourists made them look like rubes just in from the farms, which they had always been. From 1917 on, the Communists were the dregs of the Russian social order. They got worse over time. Overseeing genocide does that to bumpkins. Hayek's chapter 10 in The Road to Serfdom is correct: "Why the Worst Get on Top."
Soviet universities were known for nothing. Nobody outside of the Soviet bloc ever sent his children to be educated in the USSR.
The USSR in 1980, in the words of journalist Richard Grenier, was Bangladesh with missiles.
In the second half of the 1980's, the giant Potemkin village went bankrupt. Gorbachev, hat in hand, went begging for loans in the West. He did not get them.
Orlov continues.
But alongside all of this business-as-usual the rules and principles according which the "red" half of the globe operated were already in an advanced state of decay, and a completely different system was starting to emerge both at the center and along the periphery. Seven years later the USSR collapsed and the world order was transformed, but many people simply couldn't believe in the reality of this change.
He is correct. But the rot was there from October 1917. The USSR never was a serious social order, except for weaponry and masses of troops to throw at the enemy. Communism never built anything of value, anywhere.
In the early 1990s many political scientists were self-assuredly claiming that what is happening is the realization of a clever Kremlin plan to modernize the Soviet system and that, after a quick rebranding, it will again start taking over the world. People like to talk about what they think they can understand, never mind whether it still exists.
I knew conservatives who said this. A few still do. I was not one of them. What the Soviet Union's leaders did in December 1991 convinced me. They buried the stinking corpse. They became Russian leaders overnight. Then they re-named the cities: back to old Russian names. That was the symbolic announcement of the death of the USSR.
His point is this: what looked powerful in 1985 went belly-up in 1991. My comment: looks can be deceiving, especially if your politics blinds you to reality. Non-Leftist analysts were never taken in by the USSR. Paul Samuelson was -- totally. In 1989, two years before the USSR collapsed, as its economy was visibly falling apart, Samuelson and co-author Wllliam Nordhaus wrote this: "The Soviet economy is proof that, contrary to what many skeptics had earlier believed, a socialist command economy can function and even thrive." (Paul Samuelson and William Nordhaus, Economics, 13th ed. [New York: McGraw Hill, 1989], p. 837.) Ludwig von Mises wasn't deceived for a minute. He had written "Economic Calculation in the Socialist Commonwealth" in 1920. In 1966, at the age of age of 84, he wrote an article on the futility of Soviet economic reforms. Then he showed why, based on economic analysis. As he put it, "The present-day strength of communism is entirely due to the mentality of the pseudo-intellectuals in the Western nations who still enjoy the products of free enterprise." Twenty-three years later, Samuelson proved Mises's point as well as it could have been proved. As Bugs Bunny said, "What a maroon!"
Orlov then switches to the West. It, too, looks unstoppable, he says. It isn't, he says. Here is my point: there is substance in the West's social order that never existed in the USSR. The West will not suffer a comparable disintegration. The West is not a Potemkin village.
STUPID POLITICAL TRICKS
Orlov continues:
And what do we see today? The realm that self-identifies itself as "The West" is still claiming to be leading economically, technologically, and to be dominant militarily, but it has suffered a moral defeat, and, strictly as a consequence of this moral defeat, a profound ideological defeat as well.It's simple.
1. How can they talk of the inviolability of private property while confiscating the savings of depositors in Cypriot banks?
2. How can they talk of safeguarding the territorial integrity of countries while destroying, in turn, Yugoslavia, Iraq, Libya, Syria and Ukraine?
3. How can they talk of free enterprise and then sign contracts to build ships but refuse to deliver them because of pressure from Washington, as happened with Mistral ships which Russia ordered from France?
4. How can they talk of democracy and then use naked threats against the premier of Greece--the birthplace of European democracy--forcing him to ignore the unprofitable results of the Greek national referendum?
5. How can they talk about fighting racism while in the US they are constantly shooting mass quantities of unarmed Negros, all the while forbidding people to call them Negros.
6. How can they accuse the Serbs of genocide while refusing to acknowledge what they did to supposedly "independent" Kosovo, which has been turned into a European criminal enclave specializing in the production and distribution of narcotics?
7. How can they claim to oppose extremism and terrorism while training, arming and financing ISIS and the Ukrainian Neo-nazis?
8. How can they talk about justice while the US maintains the largest prison population in the history of the world and has executed many people subsequently discovered to have been innocent?
9. How can they talk about freedom of religion after the US federal government exterminated the Branch Davidians in Waco, Texas, and then imprisoned the survivors, even though the government's allegations against the sect have subsequently been proven to be false?
10. How can they accuse others of corruption after the colossal financial embarrassment of 2008, in the run-up to which obvious financial bubbles that were ready to bust were assigned the highest ratings?
What has happened is the worst thing that could have possibly happened: in full view of the entire world, "Western values" have been demonstrated to be null and void.
Western political values, yes. Western private values, not yet.
If you think that these are just some specific examples of difficulties or mistakes that could potentially be overcome in some dim and foggy future, then you are wrong: this is all of the "Western values" worth mentioning, and they have all been invalidated by observation. Note the past tense: they already have been invalidated. Are there any "Western values" left intact? Oh yes, just one: the rights of sexual minorities. But it is not possible to maintain Western civilization on the strength of gay marriage alone.Is it any wonder then that the rest of the world is trying to put as much distance between itself and the morally bankrupt "West" as it possibly can, as quickly as it can? China is working on developing its own model, Russia is striving for self-sufficiency and independence from Western imports and finance, and even Latin America, once considered the backyard of the US, is increasingly going its own separate way.
But the separate ways that all of these societies are heading are in fact side roads along the same highway. Western fascism is still the model for all of them. They call it something else, but that is what it is. It is the alliance between the state and the private sector. This is the dominant Western economic outlook today.
Putin is an ex-KGB apparatchik. He is now the supreme bureaucrat and the supreme politician. He has no ideology. He has no vision. He has no commitment to a new world-and-life view. He is not offering a different philosophy. He is a Russian nationalist, a former Russian bureaucrat, and a master of what is a Russian version of crony capitalism.
Chinese politicians are just the same.
Latin America's revolutionary leaders are a bunch of third-rate socialists, trying to do a Fidel Castro impersonation. They are basically Hugo Chavez, but without the oil.
In other words, the rest of the political world is just as corrupt as the West's is. As George Wallace used to say, there is not a dime's worth of difference among any of them. I would modify this. There is not an SDR's worth of difference.
We are back to the old political slogan, which I invoke again and again: "You can't beat something with nothing."
A CONFEDERACY OF DUNCES
China is a Keynesian laboratory. It has more central bank inflation than we do. It has more government intervention than we do. The apparatchiks who run it are stupider economically than ours are. They steal from their people on a massive scale. It is a rigged mercantilist economy. It is better than communism, but it is certainly worse than anything in the United States.
This is also true of Russia. This is also true of Latin America, with the possible exception of Chile.
The ranks of the fools who are still buying the West's story are shrinking, while the ranks of the rebels are growing. There is the truth-teller Edward Snowden, who was forced to flee to Moscow to avoid persecution back home. There are European parliamentarians who recently broke ranks and visited Crimea. There are French and German military men who are volunteering to defend Eastern Ukraine against Western attack. There are the many European businessmen who came to the Economics Forum in St. Petersburg to sign trade deals with Russia, never mind what their politicians think of that.
He is still focused on politicians. There, it doesn't make much difference. They are all corrupt. The systems on both sides of the border between East and West, wherever it is, are corrupt. They are too big. They are interventionist. They all have the same kind of central banks. They are all run by Keynesians. There are only degrees of difference.
On the other side, the rapidly emerging new world order was recently on display in Ufa, capital of the majority-Moslem Republic of Bashkortostan in Southern Urals, Russian Federation. Leaders of more than half the world's population came there to sign deals, integrate their economies, and coordinate security arrangements. India and Pakistan set their differences aside and walked in through the door at the same time; Iran is next. "The West" was not represented there.
These political leaders are apparatchiks and hacks, just like political leaders everywhere else. They can sign all of the deals they want. These deals are deals between governments, and these governments are inefficient, corrupt, and Keynesian. It does not matter what agreements they sign. It does not matter what these deals promote. The deals won't work, because they are deals among government politicians and bureaucrats. This is international Keynesianism.
Now that all Western values (other than the rights of sexual minorities) have been shown to be cynical exercises in hypocrisy, there is no path back. You see, it is a matter of reputation, and a reputation is something that one can lose exactly once. There is a path forward, but it is very frightening. There is the loss of control: Western institutions can no longer control the situation throughout much of the world, including, in due course, on their own territory. There is the abandonment of the Western narrative: Western pontificators, pundits and "thought leaders" will find that their talking points have been snatched away and will be reduced to either babbling apologetically or lapsing into embarrassed silence. Finally, there is the loss of identity: it is not possible, for the non-delusional, to identify with something ("The West") that no longer exists.
Western values, no. Western political values, yes. But so what? You can't beat something with nothing. The BRICs' politicians are wanna-be's. They are bumpkins on the outside, looking in.
But the most frightening thing of all is this: behind a morally bankrupt civilization there are morally bankrupt people--lots and lots of them. Their own children, who will be forced to make their way in the world--however it turns out to be--will be as disrespectful of them as they were of their own vaunted civilizational values.
Orlov doesn't discuss the extent of the international cooperation within the superclass. He needs to comment in detail on the book by David Rothkopf: Superclass. This book is very good on the main point: there are about 6,000 leaders who control total wealth that is equivalent to what the bottom two billion people own. They are interconnected. About a third of them attended the same three-dozen colleges and universities. They are Keynesians. They are deal-doers. There are multibillionaires among them. There is an ideology that is common to them: the government-business alliance. In other words, they are fascists. There are Eastern fascists, and there are Western fascists. But they are all fascists.
Asia is now Western. India has been Western at the very top of its political leadership for at least a century. Gandhi was a British-trained lawyer. China is Western at the top because Marxism is inherently Western: the concept of linear history. Asian markets are at the bottom is more mercantilistic than free market, but mercantilism is Western. Asians are learning English. They are on the Internet. The intellectual leaders of Asia's future attended Harvard, Yale, and Berkeley. The best universities are in the West. Asians who want their children to succeed in the East send their children to study at the best universities in the West. This has been going on since the 1920's.
Orlov needs to read Barzun's book, From Dawn to Decadence (2000). He needs to read Van Creveld's book, The Rise and Fall the Nation State (1999). I have discussed their importance here:
There is no serious challenge to the Western political model. There is simply competition among brands.
BRAND COMPETITION
The central institution in almost every modern nation is its central bank. Here is where unofficial sovereignty lies (in both senses). Central bankers do not claim this authority; they merely exercise it. They let politicians take the hit for economic failures. They call the shots, because they control the central institution: money.
The mark of sovereignty never changes in history: coinage. There is usually a politician on a coin. This goes back to 600 B.C. Ethelbert Stauffer was a theologian, an historian, and an expert in numismatics. He wrote his great little book, Christ and the Caesars (1955), in terms of the history of the Roman Empire's coinage: the deterioration from precious metals to copper coins with fake silver. The coins had images of a god on one side and a Caesar on the other.
Today, we have paper money. Each nation's paper money has different politicians' pictures on the bills.
This is no longer so important, because most money is digital. We get our choice of credit cards. Here, there are bank logos, not politicians' pictures. The churches of America are MasterCard, Visa, and American Express. There is brand competition.
When politicians go to summits to do their deals, they always take the finance ministers. Their finance ministers are the liaisons between the politicians and the central banks. The politicians are on tight chains, not the other way around.
The public keeps its collective eye on the politicians. This is exactly what central bankers prefer.
The politicians are the Great and Powerful Oz. Central bankers are the little man behind the curtain.
SPECIE VS. SPECIOUS
Counterfeit coins have been with us for as long as specie coins have circulated. Specie has not circulated since the mid-1960's in the United States.
There are no gold and silver coins circulating anywhere in legal markets. This is the mark of the triumph of central banking. The coinage reflects the integrity of the banking system. Fake.
Here would be a serious alternative to all of the name-brand national chains of the New World Order.
1. The abolition of the nation's central bank.2. Private coinage systems
3. No legal tender laws
4. No membership in the UN, IMF, World Bank, or any NGO
5. No membership in regional military alliances: NATO, CENTO
6. No "most favored nations" trade deals
Until we see a nation that moves in this direction, there are no serious alternatives to the New World Order. It wins by default.
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