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The Free Market vs. Fraud

Written by Gary North on April 16, 2016

Charles Hugh Smith begins his essay on widespread fraud in the rhetorically correct way: by stating the truth in a list of short observations.

This can’t be said politely: the entire status quo in America is a fraud.

The financial system is a fraud.

The political system is a fraud.

National Defense is a fraud.

The healthcare system is a fraud.

Higher education is a fraud.

The mainstream corporate media is a fraud.

Culture–from high to pop–is a fraud.

Need I go on?

I have never seen a more cogent short list of neglected but important points.

But Smith neglects to see all this as an extension of Sturgeon’s law: “90% of everything is crap.” Theodore Sturgeon was my favorite science fiction author in my youth. But his law is more science than fiction.

What is different today is this: a growing minority of Americans understand the specific nature of several of these frauds, and the general public is sensing that something is deeply wrong.

There is another important aspect of this list: it’s not just America. Western industrial society indulges in the same frauds.

The financial system is international. It’s an Anglo-American fraud. At the heart of this is the Mother of All Financial Frauds, central banking. The British provided the model in 1694: the Bank of England.

Higher education is a fraud everywhere. It’s not just the West.

Outside of the State of Israel, national defense is a fraud.

The West’s political systems have been frauds from the beginning. The increase in fraud is due to democracy. It takes greater skill and more spin to bamboozle the democratic public than it does a public under tyrants. That is Classical Greece’s legacy to the West. Educated men in the West have been asked to read Thucydides’ reconstructed speech by Pericles on Athenian democracy. In the good old days, educated men read the speech in Greek. But their teachers rarely asked them to put two and two together. Pericles had convinced Athens to start a war with Sparta in 431 B.C. In the second year of the war, he gave a funeral oration — a rhetorical justification of his own lack of good judgment. If you want the background, read my 2003 article, “It Usually Begins With Thucydides.” Athens lost the war after 26 years. Five years later, the Athenian government convicted Socrates of corrupting youth by asking politically incorrect questions. Socrates was silly enough to drink the hemlock instead of departing, which was an option granted to him by the assembly. He believed — as they all believed — in salvation through politics. For the Greeks, as for Tip O’Neill, all politics was local. Socrates preferred to die rather than to leave Spin City. Apologists for both Greek democracy and Socrates have been spinning this sequence of events for a millennium. The Western political tradition rests on fraud. The more things change, the more they stay the same.

In the United States, this increase in the reign of political fraud has had the support of the public for over a century. The election of 1912 solidified it politically: the triumph of the Progressives. We had a respite, 1921-29. Then it ended. Basically, the Presidential election of 1904 ended the Old Democracy: limited civil government based on Grover Cleveland’s model. Yet how many historians — let alone voters — remember that election and the candidate who lost? Almost none.

(For the rest of my article, click the link.)

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