What Happen When A Country Goes Bankrupt

This is what happens when a country goes bankrupt

It's uncomfortable to think that the 'richest', most powerful nations in the world-- the United States, most of Western Europe, Japan, etc. are already insolvent.

But if you read the first installment of this Crash Course you know that this statement is based on fact. It's not some attention-seeking end of the world prediction... but merely a presentation of publicly available data and fifth grade arithmetic.

History is full of examples of superpowers buckling under the weight of too much debt and unsustainable finances. The Roman Empire. The Soviet Union. The French Bourbon monarchy. The Ottoman Empire.

This is not the first time in history that it’s happened. And it's foolish to think that 'this time is different'.

Furthermore, history shows that whenever governments enter this 'orbit of insolvency', they almost always rely on the same destructive playbook of tactics. Capital controls. Price controls. Gun controls. And more.

Today we should talk about these steps-- what history demonstrates are the eight steps that bankrupt governments almost always take. You can read today's lesson here:

http://secure.sovereignman.com/cc/eight-steps

You'll also find a riveting video clip with Ron Paul and Jim Rogers from the Offshore Tactics Workshop that we held in Chile earlier this year. Ron thinks that "there's going to be a lot more chaos yet to come."

>>1

Internationalization Crash Course : http://secure.sovereignman.com/cc/welcome

Six Pillars of Self-Reliance : http://s3.amazonaws.com/sm-cdn/reports/SixPillarsOfSelfReliance.pdf

Game of chicken as Congress shutdown looms


LAWMAKERS have one final day to prevent the first US government shutdown in 17 years, with congressional leaders showing little intent to compromise.

   But House Republican Kevin McCarthy offered a glimmer of hope when he said: "I think the House will get back together in enough time, send another provision not to shut the government down but to fund it, and it will have a few options in there for the Senate to look at again."

   Congress must pass a stopgap funding measure before the new fiscal year begins today or much of the US federal government will close down. - AFP.

SFBE gets a smaller cardboard-box.

http://www.thewebcomiclist.com/o/8538

Here's a fun bit of trivia: The last US President to propose a universal health care system was Richard Nixon. He'd had an older brother who died of tuberculosis, and the costs of his medical care drained his family. He had to work as a janitor to support himself in high school. Nixon managed to keep up his grades anyway and got a scholarship to Harvard - which he had to turn down, because it didn't include a stipend for room and board. His parents couldn't afford to help because of the money they were spending on his poor brother.

As shady as he was, Nixon understood the miseries of being poor and unable to afford health care. Think about that for a minute: Richard fucking Nixon, a guy who's name became shorthand for political corruption, was more compassionate and tuned in with the needs of the American people than Republicans are today.

FIRST IN 17 YEARS

Budget impasse forces US shutdown

MONUMENTS closed, offices fell silent and 800,000 public servants were told to stay at home on Monday as Washington's perennial political crisis forced the first government shutdown in 17 years.

   The effects of the budget battle ranged from the poignant to the symbolic. A social programme that provides food to poor women and children was hit and the Statue of Liberty was closed to visitors.

   Under the Capitol, where rival clans of lawmakers failed overnight to find an eleventh-hour deal to pass a federal budget, the National Mail was sealed off by a sign marked "area closed".

   Prospects of a swift resolution to the crisis were unclear and economists warned that the struggling US economic recovery could suffer if the shutdown drags on for more than just a few days.

   In a zero sum battle typical of the divided US political system, Republicans tied new government funding to attempts to delay or dismantle President Barack Obama's signature health care reform.

   Each time, their effort was killed by Mr Obama's allies in the Democratic-led Senate, leaving the government in limbo when its money ran out at the end of the fiscal year at midnight Monday.

   "This is an unnecessary blow to America," a sombre Senate Majority Leader Harry Reid said.

   Some federal agencies deemed non-essential were all but closed. About 97 per cent of National Aeronautics and Space Administration's (NASA) staff were sent home, although those supporting the crew of the International Space Station were kept on.

   Other bodies like the military and border patrol were kept at full strength, but the Pentagon was due to stand down almost half of its 800,000 civilian employees.

   A Quinnipiac University poll said the voters oppose the shutdown as a way to derail Obamacare by a margin of 72 per cent to 22 per cent.

   While Obama supporters blamed the deadlock on a relatively small faction of "Tea Party" conservatives in the Republican-led House of Representatives, Congress as a whole has lost prestige. - AFP.

>>7
Nice sci-fi flick. You should make it into the next Fallout 4 game or something.

people stop loaning them money

First major Western govt to default since Nazi Germany?

WASHINGTON - Reneging on its debt obligations would make the United States the first major Western government to default since Nazi Germany 80 years ago.

   Germany unilaterally ceased payments on long-term borrowings on May 6, 1933, three months after Adolf Hitler was installed as Chancellor.

   The default helped cement Hitler's power base following years of political instability as the Weimar Republic struggled with its crushing debts.

   "These are generally catastrohic economic events," said Professor Eugene White, an economics historian at Rutgers University in New Brunswick, New Jersey. "There is no happy ending."

   Failure by the world's biggest economy to pay its debt in an interconnected, globalised world risks an array of devastating consequences that could lay waste to stocks markets from Brazil to Zurich.

   A default would also bring the US$5 trillion market in Treasury-backed loans to a halt.

   Borrowing costs would soar, the dollar's role as the world's reserve currency would be in doubt and the US and world economies would risk plunging into recession - and potentially depression.

BLOOMBERG

Some months ago, European MEP Nigel Farage blasted French President Francois Hollande as leading the pack "in the modern day Pantheon of idiots who are running countries around the world..."

(You can see Nigel's scathing remarks here, about 35 seconds in to the clip:  http://youtu.be/UZap5n3zGZ8)

Of course, the French president had recently introduced a 'hate tax' on its countries most successful people, driving out whatever few productive people remain in France.

But this hate tax was just the tip of le iceberg.

Just look at what they've done or announced just in the last month:

1) Double the corporate surtax

It's not enough that France has one of the highest corporate tax rates in the developed world. On top of this, they have a corporate 'surtax', or a tax on top of the tax.

And earlier this month, they announced plans to DOUBLE it.

2) Increase reporting obligations

Anyone who has ever started a business knows that a new business is like a newborn baby. It's critical to focus on growth, not on filling out a bunch of paperwork.

The French government doesn't care about this. So they've recently LOWERED the bar for reporting obligations, requiring a businesses with top-line revenue of just 80,000 euros to submit time consuming and onerous VAT reports to the tax authorities.

3) Increased pension tax

France has one of the most bankrupt... and unsustainably generous... pension systems in the world.

But rather than completely overhauling the system and expect people to, you know, actually work past the age of 55, they've just decided to raise the pension tax. Again.

4) Energy drink tax

Not to be outdone by Michael Bloomberg's soda tax in New York City, the French National Assembly has recently proposed to tax energy drinks... as much as ONE EURO ($1.37) per can.

5) Higher property taxes

Last month, the French government announced plans to revise property value assessments across the country, which serves as the basis for a number of property taxes.

6) Data tax

You can't make this stuff up.

In one of the most absurd tax propositions in history, the French government now has the idea that they should tax data transfers outside the European Union.

They actually plan on proposing this at this week's European Summit. Strangely, though, they don't seem to even understand what this means. They're just so desperate to tax something... anything. They're just monkeys throwing darts at the wall right now.

And they're getting ready for more.

Earlier this year, the French government promised a 'tax pause' in 2014, suggesting that they would not raise taxes next year.

Last month, though, they revised this pledge, saying that the tax pause would take effect in 2015 instead.

Needless to say, there will be no pause in 2015.

Why? Because France is broke. Like so many other nations across the West, France has been rendered completely insolvent by decades of unsustainable spending.

France has been in this position before. In the 18th century, the French Bourbon monarchy was the pinnacle of civilization.

Yet decades of unsustainable spending took their toll on the economy. They tried everything-- raising taxes, debasing the currency... yet their was no avoiding the inevitable. Revolution.

And this period of turmoil, from the time the French people stormed the Bastille, to the time when calm prevailed, took 26-years.

In the meantime, they had internal civil war, external war against both Austria and Prussia, hyperinflation, and the genocidal dictatorship of Robespierre.

Conditions are similar now, both in France and across the West. This includes the Land of the Free.

We have reached a time where it's imperative to look abroad at different options and opportunities. Clinging to blind patriotism-- staying home, doing nothing, and trusting your government-- is akin to taking a toaster into the bathtub.

Wealth and power have constantly shifted throughout history. And the transitions are rarely smooth or peaceful. It's foolish to assume that this time is any different.

http://www.thewebcomiclist.com/o/8538

We need to give value back to our work and back to our money, the approach of "taking it from this guy" will never work.

I say we focus on states rights, create new ways of providing for ourselves, new forms of entertainment such as mega theme parks, and trade with our selves for the next 200 years.