Charles Hugh Smith: What If There Are No Solutions?

The unencumbered realist concludes that there are no solutions within a status quo structure that is itself the problem.

Realists who question received wisdom and conclude the status quo is untenable are quickly labeled pessimists because the zeitgeist expects a solution is always at hand–preferably a technocratic one that requires zero sacrifice and doesn’t upset the status quo apple cart.

Realists ask “what if” without selecting the “solution” first. The conventional approach is to select the “answer/solution” first and then design the question and cherry-pick the evidence to support the pre-selected “solution.”

What if all the status quo “solutions” don’t actually address the real problems? This line of inquiry is strictly verboten, for there must be a solution that solves everything in one fell swoop.

Examples of this approach abound: a one-size fits all solution that resolves all the systemic problems by itself. All we have to do is implement it.

Replacing fiat currencies is one example that I have explored:

You Want Truly “Sound Money”? A Thought Experiment

Contrarian Thoughts on the Petro-Yuan and Gold-Backed Currencies

I’ve also explored how real change works: it takes many years (or even decades) of sacrifices and high costs with none of the immediate payoff we now expect as a birthright. Real change pits those benefiting from the status quo against those finally grasp that the status quo is the problem, not the solution, and these political/social battles are endless and brutal because any gains come at somebody else’s expense.

The Forgotten History of the 1970s

The 1970s: From Rotting Carcasses Floating in the River to Kayak Races

Fiat currencies contain the seeds of their own self-destruction, but establishing a gold or bitcoin standard creates its own problems. As I explained in the essays listed above, trade imbalances are inherent in a world of scarcity and so exporters of essentials will end up with all the gold / bitcoin and the importers of essentials will end up with no gold or bitcoin, and no means to buy exports. Since the exporting economies are mercantilist by nature, they cannot import enough from their customers to balance trade asymmetries.

The other problem with the gold / bitcoin standard is there is nothing inherently decentralized, equitable or democratic about these standards. In other words, any standard based on wealth distributed by scarcity is inherently neofeudal, as the wealthy / powerful acquire asymmetric ownership of all forms of wealth and use this to buy political influence to maintain this asymmetry to their advantage.

Wealth and political power are two sides of the same coin, and so the majority of gold / bitcoin / quatloos / land always end up in the hands or control of the few.

This asymmetry then enable the few to influence political processes to defend their ownership / control and lower the costs of their dominance while increasing the costs / taxes paid by the peasantry.

The ownership/control of gold and bitcoin is already extremely asymmetric, and making either the sole form of “money” will greatly benefit the few who already own/control these assets. The few peasants who acquire a gold coin or slice of bitcoin will remain as powerless as the majority who own none.

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