There Are No Bank Reserves

Just a reminder that Clown World’s economy is floating on nothing more than clown gas and demon dust:

The pattern really got going with the “bailout” in 2008. Buried in a monster bill that was waived the three day lockdown on votes was a provision that allowed Ben Bernanke to set bank reserves to zero. It was one line in a monstrosity that Hank Paulson insisted on being passed after his “one page” equivalent, which gave him sole authority on $700 billion dollars of public money, went down in defeat a day earlier. I caught it and reported on it but nobody in the Legislature said a single word about it at the time, likely because they didn’t actually read the whole thing and thus other than the snake who put it in there didn’t know it existed.

So, it’s doubtful that the USA’s ability to outspend Russia is going to work the way it did when Ronald Reagan pushed a financial arms race with the Soviet Union.

The US Congress is about to send another $44 billion to Boeing, Raytheon, and the CIA “for the war in Ukraine”. That’s a total of $100 billion sent by the US in 10 months. The entire Russian military budget for the year is $65 billion.

  • Glenn Greenwald

This is the exact opposite of what Jerry Pournelle recommended back in 1986 after contemplating the problem facing the US military.

There is just no way that we’ll respond to the Soviets by building a peacetime military establishment similar to theirs. Unfortunately, although we have rejected matching the Soviet military establishment, we have not seized upon any viable alternative. Instead, we putter about, building some of this and some of that, hoping that our technological superiority will somehow do the trick even though we have no clear cut strategy of technology.

This has not always brought about good results. As Congressman Newt Gingrich, among others, has repeatedly pointed out, simply throwing money at the Pentagon is wasteful. Given money but no marching orders, the Pentagon almost always buys more M-1 tanks for the Army, more carriers for the Navy, wings of F-16’s for the Air Force. They buy “things people can ride on,” as one analyst recently put it.

Left to its own direction, the military is very conservative. Military establishments tend to keep the old, while flirting with the new and glamorous; to buy one or two armored cars, but keep horses for the cavalry. To put catapults and seaplanes on battleships, but reject aircraft carriers as not needed.

The result is a lack of direction… We end up with weapons that no one is trained to use, aircraft with no spare parts and few trained pilots, communications systems that don’t quite work, ships without trained sailors to man them, and missiles that work splendidly in test situations, but have profound problems on the battlefield.

Jerry Pournelle, The Stars At War, 1986

Although it’s even worse now. Instead of funding wasteful and ineffective weapons programs, now the money is being directed into unspeakable trafficking operations and propping up the collapsing Clown World economy.