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The current global system is doomed ... Collapse now inevitable

Bankrupt USA

(NaturalNews) Those who sailed aboard the Titanic on its maiden voyage were led to believe that because of the design of the Irish-built cruise liner, it was unsinkable. History, of course, proved that to be an incorrect assumption; at 2:20 a.m. on April 15, 1912, the luxury ship sank in the frigid Atlantic Ocean with 2,200 people aboard, roughly two-and-a-half hours after striking an iceberg.

Majestic and luxurious, the Titanic – at 883 feet from bow to stern and with 16 compartments – was thought to be watertight. It wasn't. It's appearance, in other words, was deceptive.

A great many experts today – especially economists and experts who are realists and not corporate shills – are comparing modern markets and financial conditions to the ill-fated Titanic, a facade of stability, while underneath lies an infrastructure doomed to failure.

As noted by Charles Hugh-Smith of OfTwoMindsBlog, recent efforts to fix the ill-designed global financial infrastructure and change course, have been akin to rearranging deck chairs on the Titanic: they might look great on the surface, but in the end the same thing is going to happen.

Specifically, he writes:

"We're like the passengers on the Titanic 10 minutes after the mighty ship struck the iceberg: there is virtually no evidence to those on deck or those snug in their warm cabins that everything they reckoned was safe and secure was doomed to perish.

"Only those who witnessed the damage below the waterline and who knew the limitations of the ship's design grasped that the loss of the ship was inevitable and could not be reversed.

"The current world-system (call it whatever you like--cartel-crony neoliberal-state capitalism, etc.) is as doomed as the Titanic, for the same reasons: the design of the system is the source of its failure."

Rotten infrastructure stems for a poor design

There are, of course, winners in every such system. For the Titanic, the winners were the shipbuilders who were paid handsomely for the design and everyone who managed to escape a watery grave. In the current financial system, the mega-rich are likely going to survive intact, having amassed enough wealth and resources to survive a collapse. They may even watch it from a private island or back-country mansion, secreted away in some remote location.

But the rest of the world won't be so lucky. They'll be the ones who didn't have lifeboats.

So what, precisely, is wrong with the current economic system? Let us count the ways.

For starters, the United States – the world's most prosperous country and No. 1 economy – is completely, utterly, hopelessly broke. When Barack Obama took office he criticized his Republican predecessor for running up the national debt to $10 trillion; the national debt has since ballooned to more than $18.5 trillion, and is set to top $19 trillion before he leaves office in January 2017.

What's more, the amount of unfunded liabilities owed by the U.S. government to its people in the form of retirement benefits like Social Security, Medicare and so forth, is in the hundreds of trillions of dollars. That's like the deficits of Greece and Venezuela on steroids.

What's more, as noted by Hugh-Smith, automation is rapidly replacing human beings in the workplace, and the pace of replacement is quickening. In fact, some estimates say robots could put 80 million Americans out of work in the next few decades.

Collapse is inevitable

And while in the past technology has led to job creation, there is no indication that will be the case this time around. Hugh-Smith points to the ailing music industry – where downloads are free and music that once had to be purchased is easily accessed on a number of platforms like YouTube – falling from a $14 billion-a-year industry a decade ago, to a $7 billion industry today.

And plans to replace incomes lost by rapidly expanding technology – such as taxing corporations and owners of robots – are not realistic in their estimations, Hugh-smith said.

"So if the state took every single dollar of corporate profit (and how realistic is that?), that would fund less than a third of current state spending. And if the state is going to pay tens of millions of additional households a guaranteed income, state expenditures will rise by trillions more," he wrote.

"The idea that profits can support this enormous spending is simply not realistic."

In summary, there just are no good revenue models being offered now, or that will be offered in the near future. All of this combined, says Hugh-Smith, means that collapse is inevitable.






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