Theft Breeds More Theft

 

Inflation & Social Decay - Doug Casey On Rising Prices And Falling Values

Authored by Doug Casey via InternationalMan.com,

International Man: Whether it’s at the grocery store, the mall, restaurants, or airports—anywhere you turn—people are finding inferior goods and services at higher prices.

Living standards have taken a big step backward recently and are trending even worse.

What is really going on?

Doug Casey: There’s an inclination on the part of people to blame the producers of products—the butcher, the baker, and the gasoline maker—but that’s actually very silly, insofar as these people create real wealth.

They’re fighting the effects of government inflation, which doesn’t create anything but fiat currency and fiat credit, which is what actually takes the prices higher. In fact, inflation of the currency, which is to say an increase in the amount of purchasing media above the increase in real wealth. It’s what inflation is all about; it’s the State subtly stealing capital and wealth from individuals.

The big problem with the depreciation of the dollar is that producers are blamed as being the problem. They’re the solution to the problem in that they create real wealth. The real enemy here is the State and its central bank, the Fed.

International Man: How does inflation erode ethical standards, leading people to cut corners, lie, cheat, or even steal as they try to maintain their living standards?

Doug Casey: The prime directive of life is to survive, and entities, whether they be governments, corporations, or individuals. They will basically do whatever they have to do to survive.

Unfortunately, inflation is all about theft, subtle and hard to diagnose as it is, but theft breeds more theft.

Leaders of any organization, whether it be governments or corporations, set the moral tone. The average person may not understand much about economics, which is the study of how men produce and consume in order to survive, but they have an intuitive, even if not a technical, understanding of it.

Inflation, the theft of people’s wealth, eventually leads to revolution and overturning of society itself.

International Man: How does inflation contribute to a more litigious society, with people increasingly looking to take money from others through the legal system?

Doug Casey: Once again, the average person doesn’t understand economics very well, but he does understand that some people in modern society are getting rich without producing anything. And, they’re benefiting from the subtle fiat currency creation.

In any event, they diagnosed that there’s a theft going on. In a society based less and less on production and more and more on the theft of pre-existing wealth, it’s natural enough that it becomes a Hobbesian war of all against all where counter-theft takes place through the legal system as opposed to actual physical violence.

It’s very much like Al Capone said. “One thug can rob a gas station of $100, and if he’s caught, he’ll go to jail for years. But a lawyer with a pen can rob a country of a million and never get caught.” That’s what’s going on.

The system has become entirely corrupt, and the government, which is supposed to protect the individual man, is actually the main culprit in stealing money from him. The fact that the US has over a million practicing lawyers is a symptom of corruption where people are using the legal system to steal.

International Man: What are some historical examples of inflation leading to significant social and cultural degradation, and what lessons can we learn from them?

Doug Casey: The destruction of the currency usually leads to a social upset because people who’ve produced in their lives and saved the difference do so with the national currency. But if the national currency is destroyed, everything they’ve worked for throughout their lives is also destroyed.

Inflation upsets the entire basis of civilized society. It was a major reason why Chiang Kai-shek’s regime collapsed in China after World War II and a major reason why the Communists, whatever else they’ve done to their society in China, have been reasonably competent managers of their own currency.

The Weimar Republic in Germany after World War I completely destroyed the mark, and the social upset that it caused led to rioting in the streets between the Nazis and the Communists, and of course, the Nazis won.

Some countries suffer from perennial inflation, which results in a constant attempt to take over the government.

People find that when real wealth becomes hard to produce, there’s an inclination to go into politics to gain wealth and power as opposed to producing things. It’s why countries with unstable currencies become unstable socially, economically, and politically as well.

International Man: You have frequently discussed how to protect yourself from inflation’s financial and economic effects with gold and other hard assets.

However, aside from the financial effects, how do people protect themselves from inflation’s negative social, cultural, and political effects we’ve discussed today?

Doug Casey: The most important thing that you can do is gain skills, lots of skills, both in breadth and in depth so that no matter how things are sorted out, you’ll always be in a position to produce things that people want.

I’d like to share Robert Heinlein’s quote about what somebody should be able to do.

“A human being should be able to change a diaper, plan an invasion, butcher a hog, conn a ship, design a building, write a sonnet, balance accounts, build a wall, set a bone, comfort the dying, take orders, give orders, cooperate, act alone, solve equations, analyze a new problem, pitch manure, program a computer, cook a tasty meal, fight efficiently, die gallantly. Specialization is for insects.”

I suggest that there’s a practical path to doing that, to qualifying yourself to thrive no matter which way the economy evolves. And for 90% of the people, it’s not sitting at a college desk for four years listening to a woke professor drone on about politically correct topics.

I suggest you subscribe to Matt Smith’s son Maxim’s blog, where he describes, on an ongoing basis, exactly what he’s doing to educate himself instead of going to college.

For many years, I’ve considered college to be a complete misallocation, even worse, a waste of four of the best years of your life and a lot of money to have your head filled with incorrect ideas, which are hard to wash away.

So, the answer to the question is to prepare yourself intellectually, psychologically, and skill-wise.

It’ll put you in a position to produce more than you consume. And what we usually talk about in this newsletter is what you do with the wealth that you save so it’s not inflated away by your government.

*  *  *

The truth is, we’re on the cusp of an economic crisis that could eclipse anything we’ve seen before. And most people won’t be prepared for what’s coming. That’s exactly why bestselling author Doug Casey and his team just released a free report with all the details on how to survive an economic collapse. Click here to download the PDF now.

via zer0hedge