Happy Lockdown Day
We hope you had a good Labor Day.
While the holiday traditionally marks the end of summer, we’re not really at the seasonal “end.”
There are still a couple of weeks before the calendar rolls over into fall.
But still, this is when people usually return from vacation and get serious about work for the rest of the year. Kids are in school, too. And fashion-conscious women no longer wear white shoes…
This year, all that comes with virus-related variations.
Many people now work at home unless they’ve been laid off. There’s widespread anxiety over jobs and finances.
Kids are “sort of” in school, or watching classes online, depending where you are.
And white shoes? Well… there are fashion criminals among us.
Something else, too… Labor Day 2020 marked six months since the coronavirus slammed home in the U.S.
It’s been six months of “lockdown,” in one form or another: isolation, facemasks, social distancing, shortages at stores, disruption to travel and much else about the American way of life…
From behind the Whiskey bar, we saw some of this coming…
And with Labor/Lockdown Day behind us, it’s fair to ask what other rocky roads lie ahead with life, education, politics and the economy.
Let’s dig into this…
Early March seems like an age ago. The U.S. economy was firing on all cylinders, although the far away, China-centered “virus” issue was worrisome.
Indeed, China was sick on a vast scale. Wuhan and surrounding provinces were locked down; well over 60 million were under some sort of isolation or quarantine.
At the end of January, major airlines cancelled air travel between the U.S. and China. By mid-February there were rumors about shutting down U.S. traffic to/from Europe. (That happened in the third week of March.)
But none of this would have been a big surprise to you if you read my Feb.13 article, “A Nation in Facemasks.”
“What’s happening in China is about to affect you in a big way — no matter where you live or what you do,” I wrote.
“You will feel this thunder out of China sooner or later… and probably sooner.”
I discussed China’s economic shutdown and described the industrial fallout, including closed factories, cargo containers that never loaded, ships that cancelled sailings and eventual empty shelves in American stores.
I discussed China’s draconian approach of locking down its population to control the spread of the virus. I mused whether this kind of action might land on U.S. shores.
The virus “is already playing havoc with the global economy,” I wrote.
“It’s going to smack-down many overvalued plays and players. And beyond that, if that virus breaks free it’ll play havoc with every belief and social myth we hold. It could be a sickness that surpasses biology.” (Emphasis added.)
And here we are… Six months into our U.S. lockdown, with social, political and economic effects that are severe enough to be able to forecast generational impacts.
Think of the tens of millions unemployed, many of whom will never get their old job back. And consider the millions of closed businesses, many of them gone for good.
We are witness to a generation of human effort up in smoke, in a vast conflagration like one of those massive California wildfires that are visible from space.
Think about “stranded capital” — the hundreds of billions of dollars’ worth of sports stadiums, concert venues and museums all empty of visitors. Consider the under-used airports and fleets of commercial airplanes sitting idle in desert storage.
Also don’t forget the empty commercial real estate, motels, shopping malls, closed factories and much more, growing moldy across the land.
And wrap your brain around entire regions where oil production has become uneconomic… where wells, equipment and (figuratively speaking) workers are being “shut in.”
Then there are those multitrillions (with a “t”) of dollars spent by Congress, “borrowed” — ha! — from the Fed, via the Treasury Department. Pay it back somehow, some day? No, never…
And where did that tsunami of dollars go? Some went — and yes, we are thankful for this — to ordinary people in the form of unemployment comp or other grants. Many millions were able to pay rent, buy groceries, get around in their car.
Justifiably, people asked, “What can the country do for me?” And the politicians sent out checks.
While far more trillions went to government grants and bailouts. To businesses — via the Paycheck Protection Program (PPP) — to keep people employed. To banks to keep the books solid. To states and localities to maintain public services. And to Wall Street, to reflate a stock market that had tumbled like a stone off a cliff.
People can argue over details. But it’s safe to say that the past six months have changed the country down to its very monetary and social foundations.
Meanwhile, many horrible, strategic, nation-killing errors and blunders have also surfaced due to the virus and associated lockdown.
Back in February, I discussed the history of U.S. pharmaceutical production, and how the country had all but walked away from that critical industrial capability.
Later, I noted how U.S. medical care has become China care.
I also discussed the fallout from decades of globalization, and how the U.S. has lost deep layers of economic power.
In mid-March, as the U.S. locked down, I discussed the new “Silent Spring,” in which most of the nation simply throttled back to what miners call care and maintenance.
And we discussed the crackup of education as colleges and universities shut down. In particular I said;
“With Harvard and others now closing doors and going online, we’re seeing a tectonic change in the country’s structure for higher education. …. [This is] a profound, multibillion-dollar, future-shaping institutional move. … By going off campus and online — even for a few months — universities across the land are rebranding, and perhaps not in a way they might have intended.”
Indeed, this fall term is shaping up to be an expensive, miserable experience for many on campus, certainly for students and faculty. Most activities at most schools remain closed. Students are confined to dorm rooms. Online classes are iffy at best.
Yet most schools still charge “full” tuition for this restrictive, online version of college education. And amazingly, students and parents are paying for it!
During my recent trip across the Northeast, I stopped near Saratoga Springs to visit old friend James Howard Kunstler. He’s a historian of architecture who writes (brilliantly!) about how U.S. society has built itself into an overly complex, energy-dependent system.
We discussed the current situation with colleges.
“The virus illustrates two vast frauds in modern academe,” said Jim. “First, higher ed has spent decades building itself into an impossible cost structure, with expensive facilities, overpaid administrators and the need for high tuition, subsidized by government loans.”
“Second, colleges and universities are failing in their basic intellectual mission. For the most part, few places offer anything like a true, higher education. Most humanities and social studies departments are little more than Marxist indoctrination centers. And even the science and engineering side has been infected.”
Just as worrisome, per Jim, is that this ideological poison has filtered down into U.S. secondary, middle school and even elementary education.
Most urban school districts are failures. They spend significant amounts of money to mis-educate large numbers of young people. Some suburban and rural school districts still perform creditably, but there’s nothing about it that indicates a comprehensive program to salvage the nation through better education.
Jim described the problem in terms of American society’s profligate use of energy:
“Fifty or 60 years ago, the planners decided it was a good idea to consolidate small schools into larger districts and facilities. We wound up with packed schools across the country that have the architectural charm of insecticide factories. We bussed kids across entire counties, wasting time and diesel fuel. All so that the vast multitude could receive a crappy education.”
Now that a national-scale lockdown keeps most young people at home, and away from their “insecticide factory” schools, the country has awakened to the fact that there’s no good, workable way to educate large numbers of children. Let alone how to do it at home in a nation full of single-parent households, or families in which both parents must work just to pay the bills.
“If we’re lucky,” said Jim, “something new and useful will come out of the home school movement. Maybe a return to the ‘one-room schoolhouses’ of old. But even that requires some critical mass of people who can still teach sophisticated subjects at levels most parents can’t accomplish.”
In other words, we’re almost certainly looking at a “lost” year for students. Or maybe two. And then, much of the overall educational system is rotten to the foundations: K–12, college, university, grad school, faculty, administrations, government oversight…
We have here a multigenerational challenge.
But right now, the immediate challenge for America is to make it through just the next two months, to the presidential election. Even then, the matter won’t be “over.”
Will Trump win reelection? Or Biden? It’s up in the air. Your hunch may be as good as anyone else’s.
After election day, we’ll see bitter arguments over who apparently “wins,” compounded by the inevitable legal battles that will follow from the broken (if not corrupt) voting system that exists in many states.
My colleague Jim Rickards has Trump slightly ahead just now. But it all comes down to “likely” voters going to the polls in key battleground states.
Don’t trust the so-called “news” media to tell you what’s happening. Most of what comes across the airwaves is just whatever, agenda-driven storyline some mega-corporation wants to pump into the ether.
And all of this plays out against a nationwide backdrop of continuing social protest over racial issues, coupled with deeper activities by subversive groups that would just as soon burn parts of the country to the ground. (Indeed, more than a few cities have already been put partially to the torch.)
So while U.S. politics has descended into trench warfare, another social and cultural revolution plays out on livestream. It’s no way to run a country… No way to run an economy… No way to build a future.
Looking ahead, beware the stock market, where even the mightiest companies are perched to fall (I discussed the downside to Apple a couple of weeks ago.)
And of course, as we move ahead after Labor/Lockdown Day, have some cash, beware of a market crash and accumulate gold and silver as the buying opportunity presents.
On that note, I rest my case.
That’s all for now… Thank you for subscribing and reading.
Managing Editor, Whiskey & Gunpowder
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