Survival__ Structuring Prosperity for Yourself and the Nation - Charles George Smith [9]
As the middle class increasingly runs afoul of the byzantine, Kafkaesque regulations imposed by an ever-expanding State, they find that financial leverage and legerdemain is far more lucrative than actually producing goods and services.
Unsurprisingly, the Plutocracy finds ways to gain exemptions, loopholes and special dispensations that greatly reduce the reach of troublesome regulations and taxes that burden middle class entrepreneurs.
As the middle class abandons thrift and production for financial speculation and highly leveraged debt (following the example of their Plutocratic overlords), tax revenues soar as leveraged speculation pyramids into bubbles, enabling vast expansions of a State which is inherently seeking constant expansion of its income and powers.
When these financial bubbles eventually deflate, then tax revenues plummet as productive work and investment have declined. Why bother working hard when the big, easy money is made via leveraged speculation? Only fools would tolerate all the regulatory costs and high taxes imposed on producing goods and services; far easier to speculate in bubbling assets like housing, stocks, energy, etc.
The State responds to this drop in tax revenues by raising taxes on the remaining productive middle class, creating a positive feedback loop which reinforces the incentives to either drop out, move to speculation or game the system.
Though heavily marginalized, the underclass also copies the Plutocrats' lead by gaming whatever entitlements the State offers to buy the underclasses' silence, passivity and compliance. Thus petty corruption and fraud increases in all State entitlement programs as every sector of society seeks to suck off the maximum benefits while contributing the least possible to the public coffers.
Thus does a nation or empire built on the sacrifices and communal spirit of its citizenry degrade into a doomed culture of self-aggrandizement in which sacrifice is for suckers and looting, manipulation, fraud, embezzlement, exploitation of influence, debauchery of credit, maximization of leverage and the pursuit of speculative riches are the order of the day from the Plutocracy on down through the technocratic upper caste to the underclass.
4. In a society with what we might term an adult understanding of the world, it is understood that difficult trade-offs are a necessary part of life. One cannot pursue every path at once, acquire every desired object at once or learn every skill at once. Priorities must be established via vigorous, open-minded debate (either within oneself for one's own decisions or within the nation-State for larger issues) and a painful triage laid down in which some wants are set aside in favor of actual needs.
Broadly speaking, this is the result of a cost-benefit analysis. Items with increasingly higher marginal costs and increasingly lower marginal returns (a topic covered later) are sacrificed in favor of projects with low costs and high returns. This is, after all, mere common sense.
This painful "adult" process has been replaced in the U.S. by a permanent adolescence in which accountability, integrity and trade-offs have been banished by stupendous borrowing. Infantile tantrums and various states of psychological denial have crowded out open-minded discussion; every want has been funded by breathtakingly massive borrowing by the State, private enterprise and households alike.
Once the thick shield of denial is finally pierced by events, it is replaced by the search for an external force or agency to blame for self-destructive indulgences. Personal responsibility, integrity and accountability are set aside in favor of an adolescent sputtering rage.
A pernicious, largely unexamined legal system creates tremendous incentives for unnecessary actions designed to ward off lawsuits,