The Fruits of Globalism: Unemployment, Social Unrest and a Deep Depression

The major U.S. stock market indexes continue to climb, despite the record number of people who are still out of work.

“It’s the virus,” the traders say. “Once that’s gone, companies will rehire their old workers and things will go back to normal.”

But they’re wrong.

The fact is, the American economy has been out of alignment for some time, thanks in large part to the work of the globalists.

They sold policymakers and workers on the idea of letting other countries build everything for us while we handled the service side of things.

All the coronavirus did was wake people up to the fact that things aren’t quite right.

The problem is that they’re misdirecting their anger and disillusionment… and have become unwitting tools for people with ulterior motives.

There’s an awful lot to unpack here — but it explains exactly what we’re seeing today and why it will continue long after COVID-19 is confined to medical history books.

So let’s dig in!

It isn’t news that unemployment is sky-high. Never in history have so many people lost their jobs at once…

Not surprisingly, most of the job losses have been in the service industries.

Take a look at this table from the Bureau of Labor Statistics (BLS).

Employment change by industry

Employment change by industry, Bureau of Labor Statistics.1

That big red bar represents the loss of “leisure and hospitality” jobs. Seven million people who used to work at bars, restaurants, hotels, casinos, amusement parks, etc., are now on the dole.

Most if the other staggering losses come from a variation of the service sector, too.

Look at “education and health services,” aka schoolteachers and medical staff. Heavy layoffs.

Or look at “professional and business services,” aka law firms, insurance offices and much more. More layoffs.

Also note how the “retail” and “government” categories also took employment hits. More service sector, in other words.

You probably expected to see retail job losses, considering the closed malls and stores, etc. from sea to sea.

But you might be surprised by the government layoffs. It’s mostly state and local government employees who’ve been caught up in office closures due to the drop in tax revenues.

All of these losses have been credited to the coronavirus. And to be sure, simply shutting down large sections of the economy to “flatten the curve” is a direct cause for the sudden spike.

There is, however, an indirect cause — the near-complete loss of our manufacturing base.

Back in in March I wrote, “A real economy makes real things.”

Put another way, tangible things have a tangible value. What a person, assembly line or full factory builds is an asset. The buyer walks away with something they can keep.

Everything else is just people passing bits of paper back and forth.

Yet over the past few decades, America has gladly given up its ability to build things and accepted more jobs passing currency back and forth. The service economy.

Policymakers bought into the idea that deindustrializing made sense because of some sort of mystical “efficiency” in foreign factories.

American workers fell for the promise that a service economy offered better, more plentiful jobs.

And look where we are now!

Meanwhile, the BLS chart shows that “manufacturing” and “mining and logging” have been less affected than most other sectors.

Of course, there was a relatively smaller employment base in those industries to begin with. Those sectors experienced their job losses over the past few decades, versus the past few months.

Still, the fact that so many of the remaining workers are still on the job tells us something — they are the vaunted “essential employees.”

The folks who need to make stuff are still making stuff.

And many of the ones who have lost their jobs because of the coronavirus have globalism to blame. That’s because the components they use come from other countries — causing interruptions to supply chains.

(I discussed touched on this briefly in my article about Boeing’s latest troubles.)

As for mining and logging, even the name is deceptive. Really, how many miners or loggers do you know?

It’s better to look at what many call the “resource”-focused sector, which extracts things from the ground. In that regard, we’ve certainly seen massive job losses across the energy belt of Texas, Louisiana, Oklahoma and more.

Those energy jobs had been keeping pipelines filled and flowing, and burner tips and refineries working. Energy workers supply the means to keep most everything else happening in the economy.

Without those now-idle hands out in the oilfield making things happen, there will soon be less U.S. oil and gas. We’ll be back to importing more and more oil. It’s the “next” significant national problem, standing there in plain sight.

Yet it’s getting lost amongst all the other noise of the moment — the large swaths of Americans who are loudly demanding to be recognized as victims.

This, too, has its roots in globalism.

Here’s another BLS chart for you. It shows the ratio of employment per population, meaning the percentage of total population in the workforce.

Employment to population ratio

Employment to population ratio, Bureau of Labor Statistics.2

Twenty years ago, about 65% of the U.S. population was “working,” meaning employed within the economy. The number took a hit in the 2008 crash, dropping to 58%. There was a slow rebuild over the past decade, back to 61% or so.

Then came the virus, which caused the sudden drop to 52% in nearly the blink of an eye.

We’re witnessing a truly “wartime” level of social dislocation, comparable to the shift in the U.S. in 1942…

Except that now, instead of millions of people leaving the civilian economy and going to work as soldiers, sailors and defense workers, they just lost their job and are now sitting at home.

The thing is, a job is a key part of a person’s identity.

A common thing to ask someone you just met is, “What do you do?”

The common way to reply is with your occupation. “I’m a waiter in a restaurant”… or “I’m a roughneck on an oil rig”… or “I write about gold, freedom, history, government overreach and other things more people should care about.”

So when 30 million people summarily lost their work and workplace, a bit of their personal identity was lost too.

In that light, it makes sense why so many people are suddenly transferring their energy to other issues such as race and social justice.

They have time, of course, thanks to being unemployed. They still have money, too, thanks to the U.S. government’s generous handouts.

But those handouts came with a time limit — and folks know the free gravy train could end at any time.

As they stew on that, the mainstream media has been feeding a constant sense that things are unfair.

It all just gels together: the loss of identity, the fear of the future, the unfairness of it all, eventually robbing a person of hope.

And that becomes the recipe for nationwide social disruption.

I suspect that what we see happening across the landscape is not something that will somehow blow over quickly.

These millions of people are ripe for exploitation by others who want to harness this widespread idle energy for ulterior purposes.

The extremes on both the right and the left are trying to tear down the country and replace it with some as-yet undefined version of a follow-on nation.

Unfortunately, even if there was a “fix” for the problem, and it began tomorrow, things would require decades to play out. Right now, we’re standing on the tip of a massive iceberg of social change.

My point is that we’re now seeing what happens when you transform from a country with a large economy that makes “real” things into a financialized service economy.

The money is made on Wall Street, not Main Street… and thanks to the coronavirus, people have finally started to notice.

Unfortunately, they’re misplacing the blame. Protesters should be demanding a productive economy that offers work, identity, fulfillment and upward mobility to tens of millions of disaffected people.

The politicians should be figuring out how to create one.

Instead, everyone is being manipulated to feel like a victim — convinced that knocking down a few statues or fighting for the right to fly certain flags will make the nation a better place.

Until we focus on what really matters — what will really make the nation great again — our troubles will just get worse.

On that note, I rest my case.

That’s all for now… Thank you for subscribing and reading.

Best wishes,

Byron King

Byron King
Managing Editor, Whiskey & Gunpowder

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1 Employment by Industry Monthly Changes, U.S. Bureau of Labor Statistics 

2 Employment–Population Ratio, U.S. Bureau of Labor Statistics

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Byron King

A Harvard-trained geologist and former aide to the United States Chief of Naval Operations, Byron King is our resident gold and mining expert, and we are proud to have him on board as the managing editor of Whiskey & Gunpowder.

This “old rock hound” uses his expertise and connections in global resource industries to bring...

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