Why Even a Modest Disruption Will Shatter the Status Quo, by Charles Hugh Smith

From Charles Hugh Smith at oftwominds.com:

Any modest reduction in debt, tax revenues, consumption or new borrowing will bring the entire Status Quo crashing down.

Consider this clipping from the August 1932 San Francisco Chronicle newspaper:

“Reduction of salaries of municipal employees and limitation of city positions to only one member of a household will be sought by (Supervisor) Adolph Uhl in two amendments to the San Francisco charter. The salary reductions would run from 2.5% for the lowest bracket to 25% on salaries of $500 a month or more.”

Thanks to the handy BLS Inflation Calculator we know that $500 a month in 1932 is the equivalent of $8,680 per month (about $104,000) a year.

Imagine the tempest of fury and outrage that would arise should this be proposed the next time local governments run short of funding. Nowadays, the calls would not be for sacrifices from the highly paid public servants but for tax increases of 25% to maintain public-servant wages and benefits while the private sector economy implodes.

This unwillingness to sacrifice for the greater good is now endemic. This is the result of two powerful social forces:

1. The loss of any shared sense of purpose or social good worthy of sacrifice.

2. The ascendancy of maximizing private gain by whatever means are available as the primary purpose and goal of the Status Quo.

The dominance of maximizing private gain by whatever means are available leaves the Status Quo brittle and fragile. Since everyone reckons any sacrifice should fall on someone else, the only possible result is disunity and bitter conflict over modest sacrifices that are too inconsequential to save the system from collapse.

To continue reading: Why Even a Modest Disruption Will Shatter the Status Quo

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