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Meet Hurricane Irma. Her cloud is not mushroom-shaped, but it’s a greater threat to our well-being than Korea. (Wikimedia photo)
For years a gathering storm of mortal threats to our well being, threats obscured by the Kabuki Theater of national politics, threats ignored by the Keystone Kops who pretend to be our leaders, threats fueled by the Masters of the Universe who are happily burning the world to stay rich a little longer, threats to our food and water and air and shelter and climate — all these threats have gathered, and worsened, and all this time we’ve wondered: where’s the breaking point?
Hurricane Irma may well decide. If she fulfills the worse expectations of her — and recent storms such as Harvey have wildly exceeded the worst expected of them — she will barrel into Miami, or close along the vulnerable Florida Coast, as a monster Category Five hurricane. If she does, she could well break us.
Before Harvey hit, FEMA was bankrupt, by any normal measure, it was holding $20 billion in debt that it has no possible way to repay. The fact that this debt is to the US government does not alter the fact that it is debt which, if not repaid, could ruin the deeply indebted creditor. Now, the governor of Texas says his state will need $120 billion to rebuild.
So what happens now if, in addition to Houston and southeast Texas, we lose Miami and much of the Atlantic Coast? While continuing the endless wars in Afghanistan, Iraq and Syria, and maybe starting one with Korea? While cutting taxes for the rich and famous? And, let’s not forget, building the Wall.
The clown princes of D.C. talk as if the only problem in paying for all this is getting the votes. But where does the money — the actual, spendable money you need to buy food and water and fix up your flooded home — come from?
We get it the old-fashioned, American way — we borrow it. But our nation is up to its ears in government debt, our businesses are up to their ears in corporate debt, our people are up to their ears in personal debt. Eight out of every 10 people formerly known as the middle class are living paycheck-to-paycheck, with nothing saved for retirement and nothing set aside for a minor emergency, let alone the destruction of a home not covered by insurance.
Can we all just keep borrowing our way out of trouble forever? That’s the way the clown princes talk. They have never seen a disaster they wouldn’t promise to “rebuild, stronger and better than ever,” never heard about a war they couldn’t afford. Spending without end, amen.
But there is a limit, of course. Arithmetic tells you that. And in fact enough people have warned strenuously about the folly of drowning in debt that the Congress passed a law that put a limit on what they could borrow. Now, every time they reach the limit they set for themselves, they change the law. This is exactly like a chain smoker who sees the error of his ways and vows to stop smoking — one year from today.
But the smoker will stop smoking when he no longer has the money to buy cigarettes. And the borrower will get no more loans when he can no longer afford to pay the interest on his outstanding loans. Or when it becomes obvious that he will never be able to repay the loans he has already taken out.
In 1980 there were two storms in the U.S. whose cost exceeded one billion dollars. So far this year there have been 10. The most expensive storm in 1980 cost $2.2 billion. Harvey alone may run to $120 billion. A “500-year flood” was once expected to occur once in oh, about 500 years. Harvey was the third “500-year flood” in Houston in three years.
Disaster planners, like generals, are always prepared for the previous war. Every disaster plan in existence, as the writer of The Black Swan, Nassim Nicholas Taleb pointed out years ago, is based on the worst previous disaster, which, when it happened, was unprecedented. We’ve had a Katrina, and we’ve had a Sandy, and as long as Harvey acted like them we were doing pretty well. But a Katrina and a Sandy within a few weeks of each other? That’s unprecedented.
There is a breaking point. It’s name could be Irma.
The rotting carcass has a few more maggots. The vultures are circling. The neighbors are beginning to complain about the smell. I think I hear wolves.
But you see, money can be created infinitely. And that means resources are infinite, too. So the politician says.
Let’s hope for now irma is not as bad as it could be right now. There is a long way to go before it comes ashore anywhere. Jong Un may well tell what the heck it is he wants and we may yet come through all this. My view is that we are not being prepped for war right now, I recall the Iraq war hype and in those days you could not question anything cause they would just scream at you for lacking patriotism, its not like that yet. Few western media liberal or conservative are hyping war either, they are hyping fear not war cause they know there is no winners which tells me that DPRK needs to be taken seriously. Its too late, the US may have to accept defeat and give Jong un what he wants.
Maybe Goldman Sachs would lend us the money? They could use the money they got from us.
BTW, did you see Jose warming up in the on-deck circle?
Even without Irma, we’re already broke, so even trying to “rebuild” Houston will be Herculean with respect to resources, money and will. I always wondered how those people who live in Tornado Alley feel when their town gets mowed over a few times. I have a sneaking suspicion that they largely don’t. Either there’s a “problem” with the insurance company (usually in the fine print), rebuilding once takes a lot of effort, but twice, I think most sane people figure it’s time to move (if they still have any resources with which to do so).
Our nations bridges and roadways, sewer systems, dams and levees, water treatment plants and gas lines – ALL ALREADY need maintenance. On top of that the West Coast is burning up, with Montana suffering mightily.
Let’s just ignore Yellowstone, mmm-koi?
CA, where an awful lot of food comes from, is overdue for a big quake. There’s nothing we can do about any of it. Yeah, sure – we’ll go through the motions, but everyone knows how this is going to play out, if your honest. We had a good run, but the movie’s about over. Sustainability is a myth, especially with climate change having gone abrupt on us while we were having so much fun.
We’ll struggle on til the end, but it’s gonna be a rough ride. We’re all just awaiting our turn.
Thanks for the cogent, thought-provoking essay, Mr. Lewis.
Esteemed Secretary of State Rexxon Mobileson thinks global warming is a -relatively- straightforward engineering problem. I agree. With determination and the right financing, we should be able -as a nation- to engineer our way right thru any tricky stuff that’s coming.
For instance, we WILL need a wall. Not a standard brick and mortar keep-em-out border wall, but a technologically advanced Netherlandic-type sea wall stretching from Fort Lauderdale to somewhere just south of north eastern Iowa.
Projected cost? By my estimate, somewhere between three and four hundred trillion in today/dollars. Yup, 350 give-or-take trillion is certainly a lot of money, but if Fed/Yellen can provide those long promised negative interest rates, circa 2050 we should be declaring total (local) victory in the grueling Battle of the Rising Tides, and all without incurring any debt!
In fact, after global warming in all its phases has been soundly defeated, central banks will owe us an S-ton of money for all our necessary but extravagant borrowing and spending. How cool is that?
Max, of course! Wow. I forgot about negative interest rates. Probably because it’s never happened before, in the entirety of human history. But that’s because we are so superior in intellect to the ancients. Hell, I guess we’ve nothing to worry about now……
Yeah it’s great! Get paid handsomely for borrowing money. It’s the New American Dream.
My plan, when negative rates are instituted, is to borrow as much money as my collateral will allow, then lend it back at penurious rates to the institutions I borrowed it from, or to anyone else, for that matter, foolish enough to borrow from me at interest.
It’s my version of the Goldman Sachs Attack, and I expect to be modestly rich, as GS has been pursuing identical-type strategies for many years now, and by all counts, they’re very successful.
Sounds like a plan 😉
We could put Miami on a large barge. Los Angeles deserves to be put on wheels, then we could just drive it inland. Houston, well I’m afraid we will have to turn it into a submarine, and that is going to cost some bucks. Good thing we have the FED.
Thanks for the laughs, guys. Guy McPherson likes to say “only love remains”. I agree. Giving each other a little bit of joy is a very high form love can take.
Have not been keeping up with Guy McPherson latley though I found there was really not much to disagree with now watching these storms and fires linked easily to global warming I dare say no one should be mocking him today.I also do agree only love remains .