Coronavirus is like termites that attack rickety wooden scaffolding. When the scaffolding collapses, you blame the scaffolding, not the termites. From James Howard Kunstler at kunstler.com:
Had enough excitement yet? At least the stock markets are following an established script: the bubble pops, the elevator drops, for a while it stops… and then investments sink to the deepest sub-basement, where they linger for a long, long time. Hello, next great depression…. We know how that story goes, even if it hurts.
This corona virus is something else. It engulfs whole populations in a fog of confounding narratives. Is it no worse than a bad common cold, except for old folks already half-gone with chronic illness? Or does it really slam people even in the midst of life? Well, Wuhan hospital director Liu Zhiming, 51, went down two weeks ago, and gastroenterologist Xia Sisi, 29, and Dr. Peng Yinhua, also 29, and some prominent Iranian politicians, and lots of very sick healthcare workers from Korea to Italy. Whatever corona virus is, I’m not persuaded that it’s a hoax.
One monster banging around in that fog is the narrative that China started this thing simply to get rid of Mr. Trump. There’s a real baby-and-bathwater proposition. Would China, in effect, blow up its export economy for that, i.e. commit suicide? Because a lot of those prior arrangements will probably not come back — the manufacturing supply lines for this-and-that, the fabulous cornucopia of plastic goodies extruded from all those smoking factories and flushed out to the world, the whole glorious let’s-get-rich extravaganza that Deng Xiaoping kicked off forty years ago. It’s looking like the global economy is on the rocks, perhaps for good, as we knew it. Is China as plumb crazy as, for instance, America’s political Left?
If anything, China has only validated Mr. Trump’s point that America bargained away its industrial independence, and must become more self-sufficient again. True enough. Where I depart from MAGA is my sense that the industrial age itself has probably shot its wad, and that whatever America makes of itself going forward is likely to be a much more modest and simpler way of life, without a lot of the dazzling bells and whistles we’ve become accustomed to, and perhaps some genuine hardship.
I say that, readers will recall, because it really all comes down to the energy inputs available and that part of the picture has gone pretty grim in just the past week. The convergence of world events has driven a wooden stake through the heart of the shale oil business. From the get-go, shale oil was a loser because it just cost too much to get that oil out of the rock it was trapped in. It only worked as a financial stunt during the low interest lending orgy of the past decade. It was a magnificent stunt, you understand, goosing US production to 13 million barrels a day — energy independence, with all those short-term feel-good vibes — but it was just a stunt and now it’s over. The reality of this has yet to penetrate the American hive-mind.
Corona virus neatly imploded that financing scaffold, and now, with world business locked down and markets cratering, capital is vanishing. As I’ve averred before, the shale companies spent ten years proving to investors that they can’t make a red cent. Their bonds and notes are sinking into sub-investment-grade oblivion. Some of the major producers — Whiting, Oasis, Chesapeake — have lost over 90 percent of their share value and will probably soon be gone. Who would lend them more money now, even if the money was there? (Maybe Uncle Sam’s wicked step-son, Mr. Trump, if it comes down to that… we’ll see.) Meanwhile, oil is cheap, but demand is gone, planes are not flying, ships are not sailing, stadiums are empty, lots of things are shutting down, and quite a bit of it may not ever come back.
US politics were already crazy enough before all this suddenly happened. The crisis of the past few weeks also saw the supernatural elevation of Joe Biden to the utterly implausible role of last-vehicle-standing in the Democratic Party demolition derby. Who do they think they are kidding? Not only is Joe Biden observably gone-in-the-head — that is, clearly unfit to be president — but he’s loaded down with a steaming, fetid cargo of easily proven grifting offenses so clunky and obvious they would embarrass a South Philly mobster. I’m sure Mr. Biden stayed in the race solely to avoid investigation for his operations in Ukraine and China with son, Hunter.
Corona virus has provided a chance for the former veep to duck out of the spotlight, where he spent recent weeks blathering incoherently and starting fights with voters. And now something really nefarious may be a’foot with the Dems. If the wounded Bernie Sanders does not use Sunday’s debate as an opportunity to expose Mr. Biden’s dementia and finish him off, here’s the DNC’s playbook: Hope that the stock market crash and broken economy sink Mr. Trump in public opinion, then contrive to nominate Mr. Biden and get a black woman on the ticket as veep. That part of the story has been trotted out already. I’m beginning to wonder whether that black woman will happen to be Michelle Obama, and I’m also wondering whether Barack Obama is behind the scenes orchestrating this. Of course, Mr. Biden, if elected, will serve in office less than a week — just long enough to hustle him off with the 25th amendment. Voila! The Obamas are back in the White House, out-Clintoning even the Clintons! Happy days are here again! (Not.)