From The Automatic Earth→
There is a point where, when you need to grow faster and faster just to meet your payments and other needs, you can’t grow enough anymore. That’s not just the problem for banks and carmakers, it’s the underlying issue for our entire economic system. A constant growth rate will never be sufficient down the line, you need your growth rate itself to grow. Our society depends on exponential growth. And that process stops somewhere. It’s the same as the reason why your body stops growing around age 20. If you would grow to be 10 feet tall, your bones would break under your own weight.
There are limits inherent in any and all systems, and ignoring laws of physics doesn’t mean they go away. When Glass-Steagall was repealed, and when Larry Summers, Tim Geithner, Phil Gramm and Robert Rubin managed to stop regulation of securities, Wall Street banks in effect obtained permission to grow as in the physical world only malignant tumors do and can. And we all know from observing that physical world that these tumors, if left untreated, will grow until they kill their host. America is the host to General Motors and Citigroup, to Chrysler and Bank of America. Instead of seeking treatment, the country seeks to deny the harmful and lethal effects, or even the very existence, of the cancerous growths in its body politic. And economic.
If we stick to this metaphor, it’s not that hard to see where it goes. At some point, you, or we if you will, need to make a choice. You either choose to lose your life, as when you don’t seek treatment, or you choose to risk losing your hair and feeling real sick for a time, as when you go in for radiation and chemo-therapy. Our societies as a whole are stuck in denial mode so far. Looking at the Obama, Geithner, Gordon Brown et al responses, all I see is an attitude that says: we don’t need treatment, we can beat this by ourselves, on our own.
And while miracles may have happened at times while humans have roamed this earth, it’s an insane and irresponsible gamble to take when you are a President or Prime Minister or Treasury Secretary and you hold the welfare and potentially the very lives of millions of people in your hands. That’s simply inexcusable. Still, looking at what happens to our economies and the actions, worth trillions of dollars, that are being taken, all I see is continued denial. It’s impossible to let GM and Citi go, we can’t live without them, that’s the prevailing drive.
Well, they’re going no matter how fiercely you try to deny it, like so many organs being amputated from your disease-riddled body. Toxic assets cause diseases. It’s up to us to decide whether they will finish us off as nations and societies. So far, we have made all the wrong decisions. We couldn’t have been more wrong if we had tried. It’s time to get a true diagnosis, and stop listening to faith based quacks and tea-leaf healers, to rid ourselves of Geithner and Rubin and Summers and Bernanke. Unless we have a death wish. Do we? Do you? It’s time to face that question for real…
see also Dmitry Orlov’s Social Collapse Best Practices→
Hat tip Janie Sheppard