Why We’re Fragmenting: The Status Quo Is Disintegrating

Why We’re Fragmenting: The Status Quo Is Disintegrating, by Charles Hugh Smith.

I confess to being amused by the mainstream media’s implicit view that everything would be peachy if only Trump wasn’t president. Memo to MSM: the nation is fragmenting for reasons that have nothing to do with who’s president, or indeed, which party is the majority in Congress, who sits on the Supreme Court, or any other facet of governance.

The nation is fracturing and fragmenting because the Status Quo is failing the majority of the citizenry. The protected few are reaping all the benefits of the Status Quo, at the expense of the unprotected many. …
This unsustainable asymmetry is the only possible outcome of our socio-economic system, which is dominated by these forces:

  1. Globalization–free flow of capital, labor arbitrage
  2. Nearly free money from central banks for financiers and corporations
  3. Pay-to-play “democracy”
  4. State protected cartels that privatize gains and socialize losses
  5. A system stripped of self-correcting feedback and accountability

Once you understand the inputs and structure, you realize there is no other possible output other than unsustainably expanding debt and wealth/income inequality….

What do people do when centralized systems fail to deliver what was promised? They fragment into smaller “tribes” and find fewer reasons to cooperate in centralized systems.

This has all happened before:

As historian-economist Peter Turchin explained in his 2016 book Ages of Discord, human history manifests cycles of social disintegration and integration in which the impulse to cooperate in large social structures waxes and wanes. …

Turchin’s model identifies three primary forces in these cycles:

  1. An over-supply of labor that suppresses real (inflation-adjusted) wages
  2. An overproduction of essentially parasitic Elites
  3. A deterioration in central state finances (over-indebtedness, decline in tax revenues, increase in state dependents, fiscal burdens of war, etc.)

These combine to influence the social order, which is characterized in eras of discord by declining loyalty to self-serving special interests (disintegration) and in eras of cooperation by a willingness to compromise for the good of the entire society (integration).

Well we certainly have all three forces operating in the West at the moment. The West’s declining demographics would lead to tight labor markets, except for all that third world immigration and opening of markets has led to labor over-supply except among high-end professionals.

Centralization is now a disruptive drag rather than a benefit. Centralization provided widespread gains in efficiencies in its boost phase, but now that it is sliding down the S-curve, it only benefits the few at the expense of the many.

The returns on centralization have diminished to less than zero: centralization’s primary outputs are now corruption, lack of accountability, cronyism, complexity moats and bureaucratic thickets that obscure the self-serving nature of centralized power.