Home » Economy » Now We Can Stop Paying Attention

Now We Can Stop Paying Attention

by John Rubino on November 7, 2012 · 23 comments

Two years, billions of dollars worth of political ads, and a nearly infinite number of platitudes and lies later, the election is finally over and we’re…back where we started, with a divided government run by the same people, likely to pursue the same policies and spend a similar amount of time in gridlock. Not all that surprising when you think about it, since the country is evenly split between two outmoded but antithetical worldviews.

What is surprising is that anyone thought the outcome of this election mattered in the first place. The sad reality is that the institutions that dominate the system no longer care who is “in charge.” And all it takes to illustrate this point is a quick glance at the following chart of America’s total debt, which is the sum of federal, state, and local borrowing, home mortgages, credit cards, student loans, business loans, etc.

Note that between 1980 and 2008 it rose steadily under both republicans and democrats. Even during the supposedly fiscally responsible Clinton years (1990 – 1998), while government debt fell a bit, total debt soared. Why? Because there are two ways for a government to fund its overspending: The first is to borrow, as happened in the 1980s under Ronald Reagan. The second is to convince individuals and businesses to do the borrowing and to buy stuff with the proceeds, thus producing taxable income that helps balance the government’s books. Either way, systemic debt goes up.

In the 1990s the Clinton administration chose the second strategy, using easy money to fuel a housing boom and tech stock bubble. The result was a torrent of borrowing, spending, and IPOs, which boosted federal tax revenue and produced a few years of balanced budgets. The government – for those who were focused only on the public debt – looked well-run. But to the tiny handful of Austrian economists out there, the fact that total debt was soaring, and that the average loan was becoming more and more speculative, led to the conclusion that we were creating a debt bubble that could only end with an historic bust.

That bust came in 2000, and republican George W. Bush was forced by its magnitude to leverage both the public and private sectors, producing a housing bubble combined with record government deficits. That bubble burst in 2008, leaving incoming democrat president Obama with a traumatized private sector incapable of leveraging itself further. He saw no option but to run deficits that a generation ago would have seemed physically impossible.

The system, in short, demands ever-increasing amounts of debt and couldn’t care less whether republicans or democrats provide it.

Someday the markets will put a stop to the borrowing, but until then it really doesn’t matter who we elect or what they promise. Debt, after it reaches a certain level, is all that matters – not immigration policy or health care or marginal tax rates or short term interest rates or gay marriage. All are irrelevant compared to the institutional momentum of increasing leverage.

Total debt is now about $175,000 per citizen, or $700,000 per family of four. The average family’s income is something like $50,000, so it’s clear that we’ve long since passed the point where a return to a 1980s version of placid normality is a viable possibility for the country, any more than it would be for a typical family that woke up to find itself $700,000 in debt. Going forward the choice is to inflate or die.

So Why Bother Watching?
This story is at least a decade old, and it’s getting tiresome for all involved. For the majority who expect positive change from each election the disappointment must be exhausting, as each inevitable compromise moves their latest hero one step closer to impotence. For the small number of people who see the underlying truth, this show is even harder to watch because the obvious, inevitable ending just won’t come. The zombie that should have died for good after the 2000 tech stock crash keeps shambling along, wreaking havoc or boredom, depending on whether you’re in its path or watching from a safe distance.

The solution? Accept that time spent obsessing over a process with a predictable result but unpredictable schedule is time wasted. So just stop watching. Make the right – and by now obvious – financial and lifestyle choices and then tune out. Turn off the TV and stop reading the business and political sections of the paper. Use the resulting time to develop yourself and cultivate your community. You know what’s going to happen, more or less: A decade hence your gold will be worth a lot more and everything else quite a bit less. And you know your friends will suffer and need your help. So prepare for the things that you can predict.

Once the markets stop providing unlimited leverage and the system crashes for good, then tune back in and add your voice and your capital to the debate over what to build in its place.


  • kopavi

    I so agree with this column, right on the mark. We bailed from TV around the first of the year, Watch movies on ROKU and we’re happy. Don’t listen to commercial radio I found HOS.com instead. We read a lot, had a great garden, worked on developing our survival skills. So many vote for “the lesser of two evils” but fail to realize that the lesser of two evils is evil. We wrote in our favorite candidate for most all the offices. Until the majority take this approach, nothing will change.

    • paper is poverty

      We also canceled cable after the first of the year. What people get from television is that reassuring sense of normalcy, that the world out there is going on as usual. That’s what the TV is, when it’s plugged into cable: a normalcy broadcaster. Which is exactly what we don’t need, when there are major changes coming that we need to wrap our minds around. My family now watches Netflix and Amazon videos via the Roku and it does not feel like a sacrifice. After not seeing any TV commercials for months, now when I see TV ads on Hulu I cannot believe anyone is willing to put up with them. Apparently most Americans are happy being insulted and treated like a child for 16 minutes out of every hour. They just don’t see it that way because they’re so used to it.

      I also voted third party wherever possible, but I don’t think any real change is to be had by voting except for proposals and local elections. (And proposal elections can still be bought, as evidenced by the failure of Prop 37 in California.) We need a lot less focus on voting and a lot more on direct actions like boycotts, protests, tax revolts, general strikes, etc. Good old civil disobedience. Yet another skill to retrieve from the dustbin of history.

  • David Reischer

    I feel blessed as a nomad to be witnessing a Fourth Turning. As a nomad scavenging for hard assets is in my blood.

  • http://profiles.google.com/jordan.greenhall Jordan Greenhall

    John, you have me until the penultimate paragraph. The problem? When the bust comes, gold will be confiscated just like it was 80 years ago. Or worse. The right answer isn’t to tune out, but to start fabricating the community that will be resilient enough to weather the crash and the political convulsions that follow.

    Other than that, spot on.

    • kopavi

      I don’t mean to argue the point, but…. When gold was confiscated 80 years ago, it was the standard for money of the land. Not so today. The mint is stamping gold coins for sale to anyone. I wonder about the attitude of the people to such a move. There are too many voices, such as dollarcollapse, ZeroHedge, etc who would be shouting across the land to mobilize resistance. For the government to redefine gold as a the ultimate money would be a blatant admission that all previous financial “management” was a mistake. With that as an admission, before the gold could be confiscated the bond vigilantes would destroy US bonds. At that point, would there be enough of an organized government to take the gold from 300 million reasonably well-armed citizens? Perhaps not. As Russell has suggested a better method would be to simply declare a dollar backed by a gold standard and back the new price of gold at some silly high value, $7.5k/oz. This of course presumes we have any gold left, an open question, no?

      (But just in case, silver is a better hedge against that sort of nonsense than gold as attempting to confiscate all the silver would be far more difficult.)


      • trent

        Ha, they already are confiscating assets, except this time its all of them. Printing more dollars for themselves and buying up everything that isn’t nailed down (and that will come later). Just look at how the same hedge funds that prob would have went bust are now buying up blocks of properties to rent back to the schulubs who lost most during the bust. All with the governments blessing.

        • David Reischer

          I know :(

  • Robert

    You assume that your gold is safe John. It isn’t. While all roads may lead to gold, when they get there those governments which are the worst of the criminal syndicates like China and the United States will be guaranteed to nationalize the gold of their citizens to help to stabilize their broken financial system.

    And why would you think that the same citizenry who today are kept in perpetual and willful ignorance by their educational institutions and media so they ritually vote for the DemoPublican agents of the same Power Elite over historically meaningless issues will somehow be empowered after the inflection point of bankruptcy?

    It seems to me that losers are losers and morons are morons. They are only going to wake up due pain and harsh suffering, given that the present generations of Americans have the capacity to ever learn at all. And based on the number of voters yesterday (100% of whom are voting for the system) they have not suffered nearly enough.

    Never assume that when you are within a herd of stupid animals capable of stampeding and violence at any given time that you and your family are in a safe place. Less so because should it come to that the criminal government that brought us to this point has (knowing its likely social consequences) given itself techo police state powers to bring the populace including you and me under heal as needed.

  • John G.

    Sound advice, John.

    kopavi, the vast majority of Americans did not turn in their gold when ordered by FDR:

  • http://www.facebook.com/people/David-Zuniga/1389494145 David Zuniga

    One of your best monographs yet, John.

    I would disagree with some of the comments here; the legal reality has the shoe precisely on the other foot. Rather than fearing that government would steal the citizens’ precious metals (for monetization purposes, I agree with ‘kopavi’, that silver would be superior and is the traditional metal defining a “U.S. Dollar” anyway), We The People must simply force the individual members of Congress, severally, to end their counterfeiting concession to the FED cartel — and to agree to co-sponsor OUR reform legislation (the “Lawful U.S. Money and Banking Act”, also outlawing the ‘fractional reserve’ banking fraud).

    The draft law was written by Dr. Edwin Vieira, Jr, author of “Pieces of Eight” — the two-volume, 1600-page comprehensive history of U.S. money and the laws and cases involved therein.

    If they refuse to end their constructive co-conspiracy in those financial crimes, the AmericaAgain! members of their state (or US congressional district), with the guidance, support, and organizing help of the AmericaAgain! Legal Section, will file multi-count criminal complaints or affidavits based on State criminal statutes fitting those same crimes, pursuant to charging orders in the politician’s State Criminal Court back home.

    This will be one of the 17 targets of the AmericaAgain! Indictment Engine(TM): to turn these tables entirely, placing the sovereign People back in the position of power always retained by us (read Amendment X) but never yet exercised.

    I agree with John and most of the fellows here; the majority of Americans, after five generations of government schools, are intractably ignorant and inert, by design. But that has been the historical norm since the Roman empire at least. It only takes one victim of a crime to bring a successful indictment; we will have dozens or in some cases hundreds…filling the courtroom.

    The law is on our side. And if even just 1% of the voting age population intelligent and motivated enough to take action, we would still outnumber them 4,000 to one.
    Our website is still in beta; the final site will be at AmericaAgainNow.com, but you can at least see it at http://americaagain.nationbuilder.com

    The re-election of Obama is just what we needed to energize the remnant that we hope to recruit. A Romney win would have put them back on cruise control.

    D.M. Zuniga
    Founder, AmericaAgain!

    • Gin

      What has happened with this?

      • David Zuniga

        Thanks for asking. Our new website is


        Our temporary crowdfunding site is


        My new book FEAR The People (2nd Edition) is scheduled to be at Amazon late next week (by Aug 1); it lays out what we are doing in seven states this year, in 27 states in 2016, and in all 50 states through 2020; the three stages of FEAR The People(TM)…

        First: we will obtain the last 27 state legislature votes needed to ratify the 28th Amendment (original First Amendment passed by Congress and ratified by 11 states; the first article in the Bill of Rights…the only one of 12 articles therein that has not been ratified).

        Second: we will work with TEA Party groups, homeschoolers, and military veterans in the 6,400 new, much smaller US congressional districts to populate those House seats with citizen-statesmen.

        Third: those citizen-statesmen will have as their prime directive (first official action) enacting the Bring Congress Home Act. (See the 90-second video at the second link).

        A great deal of work, and we are understaffed at present…but not for long!

  • wearyanddreary

    who gives a shit about debt? The fed is going to forgive the treasury’s debt and we start printing from scratch. DUH.

  • Pingback: Now We Can Stop Paying Attention | How To Reduce Debt Quickly()

  • Tony D

    Hi John,

    I’m so relieved that you wrote the last part about tuning out. I think Ive wasted a fair amount of time obsessing of a crash that “should have happened” by now. Worrying about the crash on a daily basis, is to a degree, pointless. Stack, prep and get on with life is a great philosophy. I’m also sick of the ongoing titillation provided by various PM “commentators” who for the past 2 years have repeatedly stated that silver and/or gold is about to explode in price. Some of them are little more than shills.
    The risk is that life will pass some people by while they “wait” for the collapse to occur. TPTB have a lot of control over this game and while collapse seems inevitable it may take a lot,lot longer than expected..

  • john.s

    scary. simple. truth.

  • Si

    Great point re tuning out, and one I am going to pay attention to. Like one of the other comments, I have spent a stupid amount of time reading and watching and waiting. Thinking that the next think MUST be it……….. Surely!

    Thank you

  • Rapscallion

    Wow! Some of you people actually voted? Why? You obviously weren’t informed enough if you shut off the TV and quit reading the newspaper. Arrrggggh! You people aren’t even close to understanding what’s really happening. Just more sheeple in the flock!

  • Scott McGiffid

    The financial system will collapse as soon as they run out of zeros.

    • oneup

      That’s OK, they can always tag on some 1’s. The shortage of zeros won’t stop the money printing.

  • Pingback: Now We Can Stop Paying Attention | What Am I Missing Here?()

  • http://twitter.com/Paul_Revere_Mad Paul Revere

    Everything that we’re doing on this planet is unsustainable. We need a new vision for the U.S. and the rest of the world. Our problems are much bigger than bankers. But most of us are so simple minded that we think protesting, voting and complaining will make a difference.


    OsiXs (Common Sense 3.1)

  • Bruce C.

    I’ve been off line for a while so I didn’t see this post until now.

    I suppose “tuning out” – or focusing on more creative things, rather – is good advice, but I actually enjoy watching the show. Good thing I’m not a god because I like to see retribution. At the same time it’s a fun challenge, and satisfying in a perverse sort of way, to actually profit from all the fraud, deceit, corruption, denial, and hypocrisy. Nevertheless, I’ll be adding two new hobbies in 2013: target practice and vegetable gardening.

[Most Recent Quotes from www.kitco.com] [Most Recent USD from www.kitco.com] [Most Recent Quotes from www.kitco.com]