A newsletter full of lies and false assumptions ....

Today a fri­end sent a news­let­ter - and I couldn't resist to show some alter­na­ti­ves to the author's con­clu­si­ons. Most Ame­ri­cans ask que­sti­ons and sta­te the obvious. But the 'brain­wa­sh' in the basic school system keeps them from que­stio­ning "Ame­ri­can Excep­tio­na­lism" and mili­ta­ry / secret ser­vices inter­ven­ti­on and covert actions around the world. And it has got­ten worse through the years sin­ce after WWII .... no end in sight.

[source: Simon Black; http://sovereignman.com/]

“What is it about this place that makes it so poor?”
It was a simp­le que­sti­on posed to me by a fri­end as we wal­ked the streets of Mana­gua, Nica­ra­gua ear­lier this week.
Nica­ra­gua is a love­ly place. But it’s poor. Very poor. It’s the least deve­lo­ped eco­no­my in Cen­tral Ame­ri­ca... and that’s say­ing something.
But it’s worth con­side­ring: what makes an eco­no­my like Nica­ra­gua so poor? And what makes others so wealthy?
Having tra­ve­led to near­ly 120 count­ries, I’ve seen the full ran­ge of rich and poor nati­ons. And I’ll tell you, it has not­hing to do with natu­ral resour­ces or anything like that.
I often have mee­tings with seni­or mini­sters and govern­ment offi­ci­als around the world who tell me all about the ama­zing resour­ces they have in their country.
“We have so much fore­stry land,” or, “Our bau­xi­te reser­ves are among the hig­hest in the world…”
Irrele­vant. Vene­zue­la has incre­di­ble oil reser­ves. Yet they’ve been living in pover­ty for years.
(Now that oil pri­ces are down the Vene­zue­lan govern­ment has had to decla­re every sin­gle Fri­day a holi­day becau­se they can’t afford to keep the lights on.)
Ukrai­ne has some of the most excep­tio­nal farm­land on the pla­net. But the coun­try is total­ly broke.
150 years ago, Hong Kong was a tiny vil­la­ge of illi­te­ra­te fisherman.
50 years ago in Sin­ga­po­re they used to defe­ca­te in the streets, and visi­tors would have to step over rivers of feces in the down­town area.
25 years ago Esto­nia was still part of the crumbling Soviet Union.
None of tho­se places has any resour­ces to speak of. But they’ve beco­me among the wealt­hiest in the world.
What’s the dif­fe­rence bet­ween Hong Kong and Ukrai­ne? Sin­ga­po­re and Vene­zue­la? Esto­nia and Nicaragua?
One of the things I’ve lear­ned in my tra­vels over the years is that wealt­hy nati­ons do have some com­mon characteristics.

Left: Ori­gi­nal;            Right: Alternative



The first set is cul­tu­ral. Wealt­hy nati­ons have a cul­tu­re that values hard work. Know­ledge. Pro­duc­ti­vi­ty. Inno­va­ti­on. Risk-taking. Saving. Self-reliance.

I’m not try­ing to say that peo­p­le in poor count­ries don’t work hard. Far from it.

The point is that if working hard and saving money are strong CULTURAL values (which tends to be the case in Asia), a coun­try is going to do better. 


Wealt­hy nati­ons have a cul­tu­re to bla­me unem­ployment on the indi­vi­du­al, not on mista­kes made by cor­po­ra­te lea­ders. Know­ledge that's free (Secon­da­ry Edu­ca­ti­on) is under­fun­ded; Hig­her edu­ca­ti­on is so expen­si­ve that the majo­ri­ty of gra­dua­tes car­ry this debt for decades.
Inno­va­ti­on, if suc­cessful, will be bought up to curb com­pe­ti­ti­on, flan­ked by laws and regulations.
Count­ries do bet­ter by exploi­ting cheap labor in tho­se count­ries they pre­vious­ly desta­bi­li­zed in order to install pup­pet regimes. 


Second, wealt­hy nati­ons have much bet­ter insti­tu­ti­ons. The rule of law is strong. Pri­va­te pro­per­ty rights are strong. Cor­rup­ti­on is limi­t­ed. Regu­la­ti­on is sen­si­ble. Taxa­ti­on is rea­sonable and efficient.

It’s simp­le; no one wants to do busi­ness in a cor­rupt dictatorship.

Bad insti­tu­ti­ons dri­ve away for­eign inve­stors. And as capi­tal is one of the cri­ti­cal com­pon­ents of eco­no­mic growth, cho­king off exter­nal invest­ment suf­fo­ca­tes an economy. 


Second, wealt­hy nati­ons have more 'fine tun­ed' insti­tu­ti­ons with a lay­out favoring tho­se who can afford it. Thus the rule of law is depen­dent on the amount of money inve­sted. Pri­vate pro­perty rights are good only if the­re isn't an eco­no­mic advan­ta­ge for the rich if they grab it. 

Cor­rup­tion is cal­led "net­wor­king". Regu­la­tion is in favor of tho­se who belong to the estab­lish­ment. Taxa­tion is for tho­se who deri­ve inco­me from work - tho­se ear­ning through 'invest­ment' don't pay.

Invest­ment into the U.S.A. drop­ped sin­ce Trump took office - but he's just out­spo­ken, whe­re­as the for­mer admi­ni­stra­ti­ons dealt their bia­sed actions for the rich in secrecy.


Last (and most important­ly), wealt­hy nati­ons have an “inclu­si­ve” economy.

This means that peo­p­le aren’t medieval serfs toi­ling away for the estab­lish­ment. If someone deve­lo­ps skills, works hard, and takes risks, they’ve got a good chan­ce of moving up the socioe­co­no­mic food chain.

Eco­no­mists call this “inco­me mobi­li­ty”. In the United Sta­tes it’s known as the “Ame­ri­can Dream”. 


Peo­p­le are no lon­ger slaves belon­ging to a per­son - nowa­days they belong to cor­po­ra­ti­ons. The data show that only in rare cases peo­p­le reach ano­ther level on the social lad­der. The few who make it are adver­ti­sed, tho­se who don't are not reco­gnized. They are the majority.

Soli­da­ri­ty with the weak is dead, com­pas­si­on is prac­ti­ced by word, the con­sci­ence is num­bed by a cha­ri­ty check on Christmas.

Any 'sur­plus' on inco­me has to be saved for reti­re­ment, as the systems in place (Social Secu­ri­ty) have been plun­de­red to pay for exce­s­si­ve mili­ta­ry spending. 


Yet all three of the­se fac­tors are start­ing to dis­ap­pear in the US… and in the West in general.

America’s self-reli­ant, risk-taking, hard working, pio­nee­ring cul­tu­re hel­ped pro­pel it to beco­me the wealt­hiest nati­on on the planet.

But the­se traits are rapid­ly vanis­hing, dis­pla­ced by a cul­tu­re that values instant gra­ti­fi­ca­ti­on, con­su­mer debt, and govern­ment handouts.

The insti­tu­ti­ons are fal­te­ring as well. Rule of Law is less pre­dic­ta­ble, with the govern­ment chan­ging the rules in its sole dis­creti­on when­ever it likes. 


The explo­ita­ti­on all around the world lea­ves almost no more resour­ces to rob. The decli­ne is also due to the fact that for­mer pro­du­cers of raw mate­ri­al lear­ned that it pays to install and boost pro­duc­tion of goods & sale of tho­se wit­hout the middle-man.

The US-System its­elf fostert con­su­mer debt becau­se the banks had no limit to bar them from rip­ping off the avera­ge Joe. To bla­me the so cal­led "gou­vern­ment hand­outs" is absurd, when mil­ta­ry spen­ding is thou­sand­fold that of help for the poor and needy.

The rule of law has chan­ged only in one direc­tion: To the advan­ta­ge of tho­se who can afford an expen­si­ve law firm that doesn't ask what's right or wrong but only how much money can be squeezed out of any sin­gle client. 

They pass new rules every day gover­ning ever­ything from what you can/cannot put in your own body, to how you are allo­wed to rai­se your own child, with much of it enforced at gunpoint.
And through an offi­ci­al form of theft known as Civil Asset For­feit­u­re, govern­ment agen­ci­es now ste­al more pri­va­te pro­per­ty from peo­p­le than all the thie­ves and burglars in the coun­try combined.
This is bana­na repu­blic stuff.
Most of all, though, it’s the eco­no­mic struc­tu­re that’s eroding.
The inclu­si­ve eco­no­my of Ame­ri­ca is vanis­hing. It’s beco­ming ‘extra­c­ti­ve,’ mea­ning that the system is desi­gned for the bene­fit of the estab­lish­ment and rig­ged against the individual.
You can see this most nota­b­ly in finan­ce; cen­tral ban­kers have held inte­rest rates down to prac­ti­cal­ly zero for eight years in order to bail out lar­ge banks and the fede­ral government.
Yet in doing so, they have deci­ma­ted the pro­s­pects for reti­rees, respon­si­ble savers, and most of all, young people.
It’s no won­der that the Midd­le Class no lon­ger com­pri­ses the lar­gest seg­ment of the US popu­la­ti­on, accor­ding to Pew Research.
Lar­ry Fink, CEO of Black­rock (the lar­gest asset manage­ment firm in the world) said that a typi­cal 35-year old will now need to set asi­de 3x as much money for reti­re­ment as his/her par­ents did, sim­ply becau­se inte­rest rates are so low.
And Wil­liam Dud­ley, Pre­si­dent of the Fede­ral Reser­ve Bank of NY (and one of the most important Fed offi­ci­als) recent­ly remark­ed how the US is fal­ling behind in terms of inco­me mobility.
“The chan­ce of achie­ving the Ame­ri­can Dream,” he told his audi­ence, “is not the hig­hest for child­ren born in America.”
That’s a pret­ty ama­zing state­ment, and it high­lights how obvious (and important) the­se trends are.
Again, we’re not tal­king about ‘What If’. We’re tal­king about ‘What Is.’ And it has pro­found impli­ca­ti­ons for your long-term prosperity.

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