Survival__ Structuring Prosperity for Yourself and the Nation - Charles George Smith [165]
10. Leverage capital, assets and skills. In the long view, societies, enterprises, communities and individuals fail when they pour scarce capital and labor into projects with increasingly marginal returns. Examples include constructing large stone monuments on Easter Island while you denude the island of trees and strip the surrounding waters of fish, or drilling for oil in such marginal conditions that the value of the oil extracted barely exceeds the energy costs of extracting and processing the oil.
In each case, the unasked question is: what else could have been done with this capital and labor? Would other investments have generated higher returns? What perverse artificial incentives are in place which reward misallocation of capital and labor?
Alternatively, societies, enterprises, communities and individuals prosper when they leverage existing capital, assets and skills in ways that multiply positive outputs. In many cases leverage leads not to increased production but radically reduced consumption, which boosts surplus even more effectively than marginally increasing output. In vernacular parlance, this can be summed up as "doing more with less."
Speaking of perverse incentives: the ability to borrow virtually unlimited sums of money encourages grossly inefficient extravagance. That in a nutshell is the crippling context of the U.S.A.
11. ESSA: eliminate, simplify, standardize and automate. Rather remarkably for such common-sense principles, these methods of leveraging capital, assets and skills are widely ignored because the State and Plutocracy have erected various perverse incentives for unrestricted borrowing and money printing, marginal returns, crony capitalism, financial fraud and State collusion with Elites.
Once borrowing is no longer unlimited and surplus must be generated, a new set of incentives takes precedence and ESSA suddenly makes sense.
12. Generate value and surplus (working capital). As noted elsewhere in this analysis, the U.S. has not generated a true surplus for decades. It has instead borrowed trillions of dollars from surplus-generating nations and relied upon an essentially fraudulent trade of paper dollars for tangible goods from abroad.
At the household level, generating surplus (capital, savings, etc.) has been replaced with borrowing and ever-rising debt--the very epitome of unsustainability and inevitable ruin.
13. Secure/produce/innovate the FEW resources (food, energy, water). I have stressed throughout this analysis the supremely misleading artificiality of an economics and economy based on metrics such as "GDP growth," "banking profits," etc. which are fundamentally disconnected from the real world we inhabit, a world in which soil, water, food and energy are of paramount importance. Financial legerdemain and metrics are rendered utterly worthless by severe shortages and degradation of the FEW resources, as no amount of paper currency can be exchanged for tangible goods when the shortage is severe.
If citizens are hungry, with no prospects for relief, then "GDP growth" is revealed as a conceptual artifice if not outright intellectual fraud.
The scale of our dependence on abundant, easily transportable cheap fossil fuels is almost unimaginable. The U.S. consumes some 19 million barrels a day of oil, and it produces about 30,000 barrels of biodiesel. Other alternative sources of energy are equally marginal. An integrated understanding (as opposed to a facile, superficial propaganda-based "understanding") of energy reveals that there are no cheap, easy abundant substitutes. Natural gas and uranium face their own limitations, and alternative energy sources are costly--until such time as the oil supply chain breaks down, at which point it will be too late to fabricate an alternative infrastructure.
Neither the market, a self-serving financial Power Elite nor the current insolvent State are likely to secure the FEW resources for the common good,