The Line in America’s Sand

The US has little room for more immigrants. [The Rude Awakening] May 31, 2023 [WEBSITE]( | [UNSUBSCRIBE]( The Line in America’s Sand - No, America doesn’t have infinite land for mass immigration. - Not if you want the people to survive and thrive. - America’s geography shaped it as much as its history and economic system. [Secret Gold Back currency RUINING Biden’s plans for a digital dollar?]( There is a secret currency that’s beginning to spread across America. And you only have a limited time to claim one of these “Gold Dollars” for yourself. [Click here to learn more]( And since you’ll be getting it as part of an upgrade I want to make to your account… You’ll be receiving one of these [“Gold Dollars” as a FREE gift.]( You just have to watch this [short 2 minute video]( I recorded for you and respond by Wednesday at midnight. [Click Here To Learn More]( [Sean Ring] SEAN RING Good morning from gorgeous Asti! It’s been a while, and I’ve missed you. First, a quick catch-up. Micah, Pam, and I visited Annecy (appropriately pronounced [ON-sea]) in France. It’s a fantastic city on a lake that doesn’t get as much press as many other French destinations. I’ll quickly walk you through it before I get to today’s piece. First, we walked through its old city, which still has its buildings from the Middle Ages. [SJN] Then, we walked through the porticos, which were works of art themselves. [SJN] Next, we traveled to the island in the middle of the river. [SJN] Then we walked through the island. [SJN] That’s the French version of Diagon Ally (for you Harry Potter fans out there). Then we headed toward the lake via the river. [SJN] Then we were on Lac Annecy: [SJN] It’s a sensationally beautiful city. And it’s only about 45 minutes south of Geneva. For us, it was a 3.5-hour drive from Asti. [SJN] So that’s what I’ve been up to. Of course, while I was gone, Speaker McCarthy allegedly struck a “deal” (his word, not mine) with Barely There Biden on the debt ceiling. But it’s more of the same as far as I’m concerned. McCarthy’s Twitter followers crushed him in the comments of his announcement tweet; I’m not sure why he was so smug when he went on the Sunday morning talk shows. But I’ll withhold my final judgment until the legislation finally passes. Today, I’d like to talk about a simple geographical fact affecting everything about America. Rainfall. Surprised? Let me show you. [Biden Orders Americans to Turn In Their Dollars?]( [Click here to learn more]( A former advisor to the CIA and Pentagon predicts President Biden plans to retire the US dollar we know – and replace it with a digital “spyware” currency. Your US dollars could be confiscated – or made worthless. It is underway now. On March 9, Biden signed Executive Order 14067, which could pave the way for the new US currency. AOC tweeted her support. Dems could use this to hold onto power indefinitely. [Please view this warning now](. [Click Here To Learn More]( Washington, D.C., Late 1990s I was walking around Georgetown in the late 90s with my buddy Doc, who lived across the Potomac in Arlington, VA. We went into a bookshop, where I zeroed in on a book with a map on the cover. (You know how I love maps.) The book was The Wealth and Poverty of Nations by David Landes. I only knew that Landes was a Harvard professor because it said so on the book's inside cover. I didn’t know it was the textbook he taught his classes with. I bought the book, and much to my surprise, I devoured it in a couple of days. One of the main ideas of this book is that geography has a massive impact on countries. Now that’s a commonplace idea. Then, not so much. That message always stayed with me wherever I went. And it helped me understand my new homes like London, Singapore, Barcelona, Hong Kong, the Phils, and Italy. US Geography I was on our editorial Slack channel with Rude contributor Byron King and Daily Reckoning Editor Brian Maher the other day when this very subject came up. The UK Daily Telegraph’s Allister Heath had written an article in which he mentioned this: America’s population will continue to grow, hitting 394 million by the end of the century. To which Byron replied: Such a depressing thought. Our half of the North American continent is full. Most people live where people can live, the usual places like coasts, big cities (big for a reason), and areas where they don't bake or freeze to death (except Minnesota). The rest of the USA is pretty much uninhabitable by large numbers of people. And we have maxed out everything... energy is a stretch, water/sewer systems are in crisis mode, the USA net-imports food, the medical system is overstretched, the US education system has broken down for large numbers, universities are Woke & broken, and what jobs? Our Savior Tech is laying off. Finance? (What is there to finance?) Services? (Ditto.) Manufacturing is strangled in the crib by enviro issues, NIMBY, etc. I could go on, but you get the point. I immediately put on my geography hat. Of course, and as usual, Byron was right. It’s not just the area you have to worry about. It’s the resources you need to sustain the population. The 100th Meridian Look at this map: [SJN] West of the 100th meridian, there simply isn’t enough rainfall to sustain a growing population. And this isn’t a recent discovery. From [Earth Magazine]( In 1878, without the benefit of the Landsat program, GPS, or Google, and just a decade after the creation of the National Weather Service, John Wesley Powell first advanced the idea that the climatic boundary between the United States' humid East and arid West lay along a line “about midway in the Great Plains” — almost exactly 100 degrees longitude west of the prime meridian in Greenwich, England. This line, the 100th meridian, runs from pole to pole and cuts through six U.S. states, forming a partial boundary between Oklahoma and Texas. The 100th meridian also corresponds roughly to the 600-meter elevation contour as the land rises from the Great Plains toward the Rockies. In his 1878 “Report on the Lands of the Arid Region of the United States,” Powell identified the “arid region” as the land west of the 51-centimeter-per-year rainfall line, which closely tracked the 100th meridian. This amount of rainfall per year is about the minimum that permits farming without irrigation, and it also greatly influences the types of crops that can be grown. The line Powell noted as dividing the arid and humid sections of the continent has become known as the “effective” 100th meridian. Here’s Wesley’s original map: [SJN] Credit: [U.S. Geological Survey, via Earth Magazine]( The 100th meridian is significant because it marks a distinct geographic boundary, commonly known as the "Great Plains Divide." It has critical implications for agriculture and settlement patterns in North America. The primary significance of the 100th meridian lies in the division between the arid western regions and the more humid eastern regions of the United States. East of the 100th meridian, there is generally enough rainfall to support extensive agriculture without the need for irrigation. However, west of the meridian, precipitation decreases significantly, making it more challenging for agriculture to thrive without additional water sources. This climatic difference has profoundly impacted the development of the United States. It influenced settlement patterns, with the meridian serving as a rough dividing line between the areas suitable for large-scale agriculture and those more suitable for ranching or other land use. Furthermore, the 100th meridian has also played a crucial role in shaping water management policies and practices. The western side of the meridian relies heavily on irrigation to support agriculture, necessitating the construction of extensive irrigation systems and reservoirs to store and distribute water. This has led to complex water rights issues and challenges related to the sustainability of water resources. California Dreaming Not only does the idea of unlimited immigration seem stupid, but the electoral college looks even more brilliant an idea than before. Without a massive population, electoral votes are the only fair way to maintain the union. But California takes the cake. It releases freshwater into the Pacific. On the surface of it, that seems dumb. Concerning Western water rights, it seems madness. Why does California do this? - Flood Control: California experiences periods of heavy rainfall, particularly during the winter months. When precipitation exceeds the capacity of reservoirs and other water storage systems, excess water must be released to prevent flooding. Controlled water releases into rivers and eventually into the Pacific Ocean help manage water levels and reduce the risk of catastrophic flooding in populated areas. - Water Management: California has an extensive water management system that captures, stores, and distributes water throughout the state. Reservoirs and other storage facilities collect water during periods of ample rainfall or snowmelt, and this stored water is crucial for supplying urban areas, agriculture, and other water-dependent sectors during drier periods, such as the hot summer months. Controlled water releases into the ocean may be necessary to ensure a balanced and regulated water supply throughout the year. - Environmental Considerations: Releasing water into the Pacific Ocean can benefit California's diverse ecosystems, including salmon. California has numerous rivers and streams supporting diverse ecosystems. By releasing water into the ocean, California can maintain environmental flows and preserve habitats for aquatic species. These are the official reasons, anyway. But there must be a way to get the water further inland instead of returning it to the ocean. Wrap Up Mass, unlimited immigration simply can’t be done without acquiring, inventing, or securing the resources needed to maintain the population increase. I’m sure there’s a technology that can currently fix this or hasn’t been invented yet. But continuing to leave the border wide open to migrants and other visitors - and there are lots of them - is irresponsible to the point of insanity. Have a great day! All the best, [Sean Ring] Sean Ring Editor, Rude Awakening Twitter: [@seaniechaos]( In Case You Missed It… “Are You 100% American? Prove it!” [Sean Ring] SEAN RING Happy Tuesday from a glorious Piedmont! I was ready to show you pictures from our day trip to Annecy, France, this weekend. But then the venerable Byron King, good friend and Rude contributor-extraordinaire, decided to bowl me over with yet another outstanding historical piece. Since I started reading works by people like Niall Ferguson, Jim Rickards, and, of course, Byron, I know history lessons are only complete with the economics and finance behind the big decisions. This is one of those pieces that will instantly and completely change your understanding of our history… and you’ll be able to apply it immediately to the present. In fact, after reading this, you’ll know more about this stuff than our hapless Speaker! This is a bit longer than the usual Rudes, so I’ll leave you here and see you tomorrow with an original Rude from me. All the best, [Sean Ring] Sean Ring Editor, Rude Awakening Twitter: [@seaniechaos]( [Response Requested]( 1/1000th of an ounce of gold availableReader [Click here to learn more]( As a Rude Awakening reader, Jim Rickards is offering you 1/1000th of an ounce of gold when you upgrade your account. It will come in the form of a “Gold Back” - a new type of gold currency that’s starting to spread across America ([click here to view](. If you have not responded to Jim’s offer yet, and want to know how to claim yours… Please click the link below for details. [Click here to learn how to claim your new Gold Back Currency<]( Thanks! Amber Anderson Customer Service [Click Here To Learn More]( [Byron King] BYRON KING “Are You 100% American? Prove it!” Yes… Give Your Money to the Government. I hope you had a good Memorial Day long weekend. Meanwhile, how do you like that title? Did it catch your attention? Because the idea is to question your patriotism if you don’t fork your money over to the U.S. government. It’s abrupt, but don’t blame me! That wording isn’t mine. Our government said this in a poster from 1918 during the Third Liberty Loan drive that raised money to fight World War I. Here it is, courtesy of the National Archives: [pub] Buy Bonds! (Or we’ll question your patriotism.) This patriotism-questioning, guilt-trip advertising reflects the desperation within the U.S. government in 1917-18, all to raise funds to fight a war. And it’s worth recalling for two reasons. First, we’ll discuss World War I and the Liberty Bond campaign because it was Memorial Day weekend, when we remember America’s fallen from past wars. And second, we’ll discuss government debt. Because right now, the U.S. government is in the midst of a political battle over raising the ceiling on that national debt. That is, the Democrat-run White House and Republican-majority House of Representatives are squabbling over how to continue to fund the government via the sale of… yes… bonds. Lots of bonds. Much like what happened back during World War I. Only with lots more zeroes. Sure, McCarthy agreed to a deal with the Democrats… but does he have the votes to see it through? That remains to be seen. One intriguing bit of history in all this – still pertinent! – is that the idea of a ceiling on national debt originated during World War I. It was part of legislation that enabled the second (of four) Liberty Bond drives, raising the cash that paid for the war. So in this article, we’ll discuss bonds, money, and war. And rest assured, this history from 100-plus years ago remains relevant. Paying for War in the New Age of a Central Bank Where to start? Okay, let’s start with the second term of President Woodrow Wilson. In 1916, the former professor from Princeton campaigned for reelection on the slogan “He Kept Us Out of War,” meaning Wilson kept the U.S. out of the then-raging war in Europe. But you know what happened, right? Once Wilson was safely back in the White House, he took the martial plunge. Wilson was reinaugurated as president on March 4, 1917, and less than a month later, on April 2, he asked Congress for a declaration of war against Germany. The cassus belli was German submarine warfare, namely attacks on U.S. ships that carried war materiel to Britain and France. Well, wars are expensive: “War costs much silver,” wrote Sun Tzu in his ancient text on strategy. The U.S. government had to raise immense sums of money to join the fight in Europe. More money, in fact, than the U.S. Treasury had ever raised before in a very short time. And how does one do that? One way is to sell bonds, and in ways and amounts never before seen. That is, neither the U.S. government nor the general economy was geared toward selling massive levels of bonds, let alone war bonds. Yes, per the Constitution, the federal government could issue debt, but the history along those lines was quite modest. From the Republic's earliest days, when the federal government needed funds, it issued bonds. And with every raise from 1789 to 1917, the amount and accompanying interest rate was authorized by Congress. Up until 1917, federal law provided nothing like a debt ceiling. Then along came Woodrow Wilson, and with the U.S. entry into the European war, fundraising began immediately. On April 24, 1917 – about three weeks after the declaration of war – Congress passed the First Liberty Loan Act; $5 billion was raised via 30-year bonds paying 3.5%. That was just the beginning of a Niagara-level of military spending. As you can imagine, the war, and of course, the Treasury, needed more. So on October 1, 1917, Congress passed the Second Liberty Loan Act, $3.8 billion of 25-year bonds paying 4%. And along with authorization to raise funds via bonds in this legislation, Congress set a ceiling of $15 billion of overall government indebtedness, the first debt ceiling in U.S. history. Here’s what happened. Legislators who enacted this new statutory limit on borrowing were shocked at the rapid growth of federal obligations. Wilson’s war took government spending to unheard-of levels, with entirely unknown future effects on the national economy. For perspective, in the years immediately preceding U.S. entry into the war, the annual federal budget was under $1 billion. Yet as 1917 unfolded, federal debt expanded by an order of magnitude, from under a billion to well over ten billion dollars. War or not, Congress included at least a few members with a flinty, banker-like view toward exploding debt levels. Indeed, back then, everyone alive had come of age in a nation that routinely used hard money as currency, namely gold and silver. From the Civil War to 1900, the U.S. followed a monetary policy of bimetallism, meaning that silver and gold defined the national currency at fixed ratios. Then in 1900, President McKinley signed the Gold Standard Act, which placed the U.S. squarely on the side of gold as the definition of American money. But on December 23, 1913, President Wilson signed the Federal Reserve Act, establishing a U.S. central bank. The idea was for this new entity to issue currency by fiat, meaning book entries of money unbacked by ounces of gold or silver. In other words, the Fed gave the U.S. what people called an “elastic” currency. The idea of elasticity to money supply meant that the central bank could expand or contract the amounts of currency in circulation to meet the needs of the country’s business cycles. If there were an agricultural crash in one place or an industrial crash somewhere else, the banking system could function with loans or another financial backstop from the Fed. As fate would have it, though, in 1914, the first major challenge to the newly created Federal Reserve was to finance a global war that began in August of that year, “the Great War,” as it was called, now known as World War I. By the end of 1914 and into 1915, the Fed rapidly expanded the money supply. It issued billions of dollars in new credit to support the massive trade growth in war-related materials and machinery, moving from the U.S. to France and Britain. It would be a stretch to say that anyone at the time really saw what was coming. Nobody has that kind of crystal ball. But as events unfolded, the earliest, formative days of the Fed brought an explosion of money creation. And not classical, gold standard money; no, it was fiat and mere bookkeeping entries from the Fed to banks that then issued letters of credit to pay for wartime goods and services. It was an unprecedented way to make vast claims on real wealth. And this brings us back to that debt ceiling law in 1917, part of the Second Liberty Loan legislation. In essence, a few members of Congress applied their quaint notions of hard money to the new cascade of spending and debt. They created a debt ceiling as part of national law because they wanted at least a semblance of legislative control over federal outlays, and certainly outlays financed by the issuance of wartime bond debt. The Ever-Growing Federal Debt In 1918 the U.S. passed two more Liberty Loan acts as the war unfolded, in April and September; these raised a total of $11 billion in 10-year bonds at between 4.15 and 4.25%. And then, the First World War ended on November 11, 1918. Through it all, the federal government enlisted celebrities to travel across the nation to urge people to buy bonds. For example, movie stars like Mary Pickford and a young Charlie Chaplin gave talks to promote the bonds. And even the Boy Scouts got into the act, urging fellow Americans to support the effort. [SJN] Boy Scout hands “Sword of Preparedness” to Lady Liberty; National Archives. After the war, the U.S. still needed vast sums of money to pay ongoing obligations. It raised another $4.5 billion via “Victory Loan” bonds, 4-year term at 4.75%, payable in gold, no less. The U.S. government’s war indebtedness topped out in August 1919 at just over $25.5 billion, comprised of Liberty Bonds, Victory Notes, War Savings Certificates, and various other government securities. The next question was how to pay down these obligations. Indeed, the peacetime question of how to repay the country’s wartime debt came home with a vengeance after a massive recession (some say depression) in 1920-21. Where was the wealth, let alone the tax mechanism, for the government to raise funds and pay down such immense debt? Another intriguing, if not astonishing, angle to this looming lack of tax revenue was the 18th Amendment which came into effect in January 1919 and led to the era of Prohibition, via a ban on the sale of alcoholic drinks. In turn, this led to a massive loss of formerly considerable and predictable tax revenue flows to the federal treasury and most states’ treasuries. Prohibition put many firms out of business and led to job losses for hundreds of thousands of workers across the land, from winemakers, brewers, and distillers to farmers, barrel-makers, drivers, saloonkeepers, and many more. Financially, banning booze was a national disaster. In Washington, D.C. of the 1920s, under Presidents Harding and Coolidge, and with no less than the formidable Andrew Mellon as Secretary of Treasury, it was apparent that the war bonds would not be paid in full within the scheduled life of 4-year, 10-year, and even 25- and 30-years. And in another aside, this government financial quandary was behind 1920s-era efforts to limit spending on arms, notably a series of conferences and treaties that limited naval battleships. Getting back to the Liberty Loans for the war, and to make a long story short, the solution was simply to roll them over at maturity, to issue new bonds for old. That worked throughout the 1920s until the Crash of 1929. Then the Great Depression came along and upended the entire edifice of federal finance. In 1933 Franklin Roosevelt became President. Almost immediately after taking office, he “called in” the nation’s gold and revalued it. And then came the government repudiation of elements in wartime bonds that referred to repayment in gold. The matter was resolved via the Gold Clause cases that went before the Supreme Court and took the government off the hook. This brings us to the past eight decades of government debt, now growing in a manner that looks hyperbolic, if you believe the Federal Reserve Bank of St. Louis: [pub] U.S. federal debt, unadjusted for inflation. Courtesy Federal Reserve Bank of St. Louis. This FRED chart goes back to 1939, the oldest reliable data, apparently. You can extrapolate backward and discern that federal debt in the 1920s and 30s was rather small beer. That means the big debt roll-up began in the 1970s and into the 80s and 90s. Then since 2000, it’s been up, up, and away. This brings us to the present and the current political battle over raising the debt ceiling to conform with the underlying requirements of the Second Liberty Loan Act of 1917. During World War I, people worried about raising a few billion dollars; today, the fight is over trillions, with more to come. The goal is for Uncle Sam to continue spending far more than he takes every year. We’re looking at a runup of national debt from $31-something trillion to about $33 trillion, give or take, in the next nine months or so. And if the debt ceiling doesn’t change, the U.S. Treasury cannot legally borrow more money, the stock market will crash, and all hell will break lose. Or so they say. Well, we’ll see. No doubt, the politicians will do something. After all, they want their paychecks next week, too, the same as everybody else. But as it all unfolds, think back to World War I, Woodrow Wilson, the use of patriotism as a club to beat people into giving their gold-backed money to the government, all to fight a war on another continent. And we’re still doing it. Yeah… As I said, I hope you had a good Memorial Day long weekend. That’s all for now… Thank you for subscribing and reading. Best wishes… [Sean Ring] Byron King [Paradigm]( ☰ ⊗ [ARCHIVE]( [ABOUT]( [Contact Us]( © 2023 Paradigm Press, LLC. 808 Saint Paul Street, Baltimore MD 21202. By submitting your email address, you consent to Paradigm Press, LLC. delivering daily email issues and advertisements. To end your Rude Awakening e-mail subscription and associated external offers sent from Rude Awakening, feel free to [click here.]( Please note: the mailbox associated with this email address is not monitored, so do not reply to this message. We welcome comments or suggestions at feedback@rudeawakening.info. This address is for feedback only. For questions about your account or to speak with customer service, [contact us here]( or call (844)-731-0984. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. 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