Is America’s Economy Being Sovietized?
PHOTOS.COM
The foundation of the Soviet model of trade and investment was
centralization. The entire goal of communism in general was not to give more
social and political power to the people, but to extinguish alternative options
and focus power into the hands of a select few. The process used to reach this
end result can vary, but the goal always remains the same. In most cases, such
centralization begins with economic hegemony, and it is in our fiscal structure
that we have the means to see the future. Sovietization in our financial life
will inevitably lead to sovietization in our political life.
Does the U.S. economy’s path resemble the Soviet template exactly? No. And
I’m sure the very suggestion will make the average unaware free market
evangelical froth at the mouth. However, as I plan to show, the parallels in our
fundamentals are disturbing; the reality is that true free markets in America
died a long time ago.
The Tyranny Of Planned Economy
The characteristics of a free market society defy the use of centralized
planning. Adam Smith’s original concept of free market trade stood as an
antithesis to what was then referred to as “mercantilism,” a select few “joint
stock companies” (corporations) monopolizing production while using government
ties to destroy any new competition. Unfortunately, there are to this day
economists and politicians who believe that corporate centralization is a
“natural” function of a free market. In reality, corporate monopolies are an
unnatural creation of collusion between governments and big-money interests
designed to suffocate any entrepreneurship outside of their sphere of influence.
Over time, as we now see in the United States today, government power and
corporate power begin to hybridize, until one can barely be distinguished from
the other.
The bottom line is that you cannot have planned structures, monopolized
production or controlled capital flow within an economy and still claim it to be
a “free market. There are no exceptions to this rule.
The Soviet system was the ultimate in centralization. Every aspect of
financial life was dictated by the communist government, from industrial input
and output to investment to food production and rationing to wages and retail
prices. Some people might argue that this structure is a far cry from what we
now have in the United States, but let’s look at the fundamentals.
Controlled Money Creation
One of the primary tenets of
The Communist Manifesto was the creation
of a central bank meant to keep tight controls over currency issuance. The
existence of a central bank immediately disrupts any chance of a true free
market. Central banking without competition allows an oligarchy, whether
corporate or political or a meshing of the two, to manipulate interest rates as
well as adjust prices through inflation. Lending standards (which the central
bank determines arbitrarily) built on fractional reserve banking opens the door
to murky debt instruments and toxic financial products that are further used to
either fabricate a “high” standard of living (as we saw in the U.S. in the 90s
and early 2000s) or execute a bubble implosion causing a lower standard of
living (as the U.S. is experiencing today).
Since the establishment of the Federal Reserve through subversive collusion
between banking interests and corrupt politicians in 1913, America has not had a
free market system. From that point forward, every boom and bust, every interest
rate disaster, every inflationary increase in prices has been scientifically
engineered.
Dominance Of Industry
Soviet controls on industrial output are legendary. Every part of the
resource allocation process became subject to bureaucracy, and this led to
stunted manufacturing growth as well as a culture of misrepresented economic
data. In the United States, the establishment has taken a slightly different
approach but with the same end result.
Heavy taxation on business ventures within the U.S. against entrepreneurs not
lucky enough to run in elitists circles has erased incentives for manufacturing
experiments within our borders. In the meantime, members of the corporate glee
club receive government subsidization while they simultaneously outsource
industrial projects to Third World nations. Controlled industry within communist
Russia was meant to force the population to depend upon the government for every
means of survival. In the United States, dependency on government has been
replaced by interdependency on the globalized model in general. Necessities are
now compartmentalized, and only select international businesses with cooperation
from government have the ability to bring all the pieces together to keep our
domestic economy running smoothly. Our society has been so distanced from
self-sufficiency that many people now consider the globalist dynamic
indispensable.
Bureaucracy And Food Production
U.S. Environmental Protection Agency and U.S. Food and Drug Administration
regulations, based on dubious junk science and often instituted on high without
congressional oversight, further erode business possibilities, especially for
young companies as well as private agriculture, while giving free reign to
elitist entities like Monsanto, an organization the government actually
protects through specialized legislation making it nearly immune to civil
litigation.
While farms in the United States are not exactly “controlled” by the Federal
government in the Soviet sense, many of them are subsidized through welfare on
the condition that they grow only particular kinds of crops, raise particular
animals or grow nothing at all. This subsidization is an indirect form of price
control, creating engineered scarcity or abundance. At the same time,
agricultural empires like Monsanto make private farm ownership increasingly
difficult by using their government protection to harass and squeeze out
independent food producers.
This destabilization of private resource management by common citizens has
culminated in the passage of President Barack Obama’s executive order National
Defense Resource Preparedness, which allows under a “national emergency” (which
the President can declare for any reason) the confiscation of any and all
private resources, including farms and businesses, to be redistributed by the
government to ensure security conditions. This is the Stalinist model, pure and
simple.
Centralized Control Of Investment
We now know that since at least 2008, the U.S. stock market, often presented
by the mainstream as a paragon of free market prowess, has actually been propped
up and inflated by Federal Reserve fiat. Both former Fed Chairman Alan Greenspan
and current branch head Richard Fisher have openly admitted in separate news
interviews that the central bank spends considerable energy in “artificially
sustaining” equity markets. This has been done, I suspect, with full knowledge
of the U.S. Treasury and the Obama Administration.
The Soviet model for investment was to remove all uncertainties from their
domestic markets, often in the name of preventing manipulation by “speculators.”
The speculator rationale was generally a distraction away from the attempt to
dictate the natural forces of supply and demand. The idea was that if the
government could dismiss legitimate demand or lack of demand or hide excess
supply or lack of supply, the perception of a balanced economy could be conjured
for the population. This led to strict redirection of capital to areas where
manipulation was needed to artificially pump up (or deflate) a particular part
of the economy. The government became the sole investor of the Soviet system
and, thus, the sole determinant of the success or failure of any particular
market.
This is
exactly what is going on in America today. Federal Reserve
fiat is being printed and dumped into every financial mechanism that supposedly
maintains our country’s fiscal health, including stocks, Treasuries and
municipals, while trade volume remains low and private investment disappears.
The Federal government now owes its very existence to the continued support of
central bank dollars, and the Dow Jones does as well. If this is not the Soviet
ideal, then I don’t know what is.
Labor Oppression, Dismal Living Standards And Government
Dependency
Poverty levels within the United States are at record highs. Nearly 50
million Americans are now dependent on government-subsidized food stamps for
their survival. Nearly 100 million Americans receive welfare (or Social
Security) in one form or another from the establishment. That is almost
one-third of our entire population that relies on the system for at least a part
of their sustainment. If Obamacare is fully realized, millions more Americans
will also be conditioned to become dependent on government-designated healthcare
providers. The point is not to pass judgment on those people who get money or
services from the government, only to make clear our progression away from
freedom and into centralized servitude.
For a Soviet structure to thrive, poverty among common citizens has to be
institutionalized. Dependency requires a constant state of desperation. In
America, this has been accomplished through a combination of inflated prices and
reduced wages in conjunction with the destruction of labor options.
At the height of the communist machine in Russia, employment was ample; but
the kind of employment one could apply for was dependent on bureaucratic red
tape and availability based on a worker’s record. Only the academic “elite”
within the government-run cesspools of Soviet universities and military schools
had their choice of employment; even then, they were often pressured into
particular specialized fields, depending on the kind of labor the state needed
done at that particular time.
In the United States anyone can certainly aspire to do whatever job he hopes
to do. But again, options have been removed economically; and the same academic
elitism pervasive in Soviet Union labor markets exists in America today. In a
recent installment of his weekly radio show,
New York Mayor Michael Bloomberg said it was better for
“so-so” high school students to pursue a career in plumbing rather than go to
college.
Though I rarely agree with Bloomberg on anything, my initial reaction was
surprise at his willingness to steer American youth away from university
indoctrination centers. However, upon further examination, it became clear that
Bloomberg was not trying to save the next generation time and money. Instead, he
is promoting a shift in the labor dynamic of the U.S. economy toward a
Soviet-style foundation. Bloomberg knows well that the U.S. labor market will
never return to its former glory, partly because he is a supporter of the
globalist policies that ruined our economy in the first place. Instead of
suggesting ways to reverse the trend of progressive poverty and the lack of
high-end jobs that engender ingenuity and invention, elitists like Bloomberg are
saying “forget your dreams and get used to being a drone.”
In a 70 percent service and retail economy, where job availability is
increasingly degraded and independent business is discouraged, Americans will
have two choices: Excel in the world of federally funded and propagandized
education and sell your soul just for a
chance at obtaining a
professional career in a field of influence or settle for the leftovers. For
some people, being a plumber is a fine thing; but it should not be the
only thing. In a true free market, a smart man can make his own way, even
if he does not conform to the ideologies of the educational racket. In a
Sovietized market, a smart man is prohibited from accomplishing anything unless
he conforms to the ideologies of the educational racket.
In the end, the Soviet economy was so utterly fraudulent that the final
collapse of the system came as a complete surprise to many in political and
economic fields. Centralization is an absolute affront to the natural laws of
supply and demand and an oppressive hindrance to the innovation that humanity
thrives on. Such systems require constant theft from the populace in the form of
reduced jobs, reduced wages, reduced resources, increased taxes, increased price
controls and a highly ignorant citizenry in order to function even for a short
time. Sadly, the United States is well on its way in all of these areas, lending
itself to a global economic tyranny in which all of us work much harder, for
much less and all for a government that uses our very labor against us.
–Brandon Smith
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