Reinventing Democracy

Time to “Democratize” Capital [The Daily Reckoning] September 16, 2023 [WEBSITE]( | [UNSUBSCRIBE]( Reinventing Democracy - What democracy is really about… - The role of the rich and poor in democracy… - We need to “democratize” capital… [There is MASSIVE change happening within our company]( And I want you to hear about this – from me – otherwise this new policy could blindside you. This has gone into effect immeditaly, so I want you to understand exactly what it will mean for you. [Watch This Video For My Full Announcement]( The Hawaiian Islands Editor’s note: What's the point of discussing reforms that aren't even possible in the current status quo? That’s the question Charles Hugh Smith raises today. Charles believes the status quo will reign until we “democratize” capital. [Charles Hugh Smith] CHARLES HUGH SMITH Dear Reader, What's the point of discussing reforms that aren't even possible in the current status quo? That's a good question, as any discussion of major systemic changes can be dismissed as pointless (since they'll never be adopted), and a distraction from the "real work" that can be managed within the current system. On the other hand, we might ask: What's the point of discussing what is do-able in the status quo, i.e. superficial feel-good policy tweaks that change nothing in the power structure? In other words, everything is ultimately a superficial feel-good policy tweak if it doesn't change how power, "money," credit and resources are amassed and distributed. The argument for discussing "impossible" systemic changes is this: We must ponder other ways to structure who has power for two reasons: 1) to validate how far we descended into neofeudalism and neocolonialism, and thus how desperately we need to re-arrange the power structure, and… 2) to explore different models of governance and economic incentives, with an eye on the value of competition between ideas and systems. Although this sounds cynical, it isn't: Democracy is not really about self-rule, it's about keeping an elite-run system stable by institutionalizing a safety valve and a governor on elite greed, corruption and mismanagement. What Democracy Really Accomplishes Democracy gives the rabble a restricted voice as a means of limiting elite misrule, which is the natural path taken by elites everywhere, in all eras. The elite echo-chamber is: We're entitled (by birth, rights granted by the gods, superior intelligence, merit, etc.) to rule, and therefore whatever we decide is wise — even if it is self-serving and delusional. Other models of governance rely on competition between elites to keep whichever elite is currently dominant from destroying the whole arrangement via their hubris, narcissism, greed, corruption, stupidity, delusions of grandeur and all the other pathologies of power. These models tend to fail because the dominant elite tends to see eliminating competitors as a very good strategy for consolidating power — just like corporations always seek monopolies or cartel arrangements to eliminate the pesky risks of open competition — which as we all know, introduces the possibility of losing, which is a bad thing. To eliminate the possibility of losing, eliminate competition: what an excellent solution! This is why "capitalism" isn't really about free markets, any more than colonialism is about "civilizing the natives"; it's all about eliminating competition and rigging markets. [Your Credit Card: Declined?]( [Click here for more...]( Take a moment and picture this scenario: The line at the gas pump is getting longer as you insert your credit card for the second time. You decide to head in and ask the cashier what’s going on. There’s a long line inside. The woman in front of you looks frustrated. Everyone does. “There’s nothing I can do. You’re declined,” the cashier says to the man at the front of the line. It’s not just you. Everyone is declined. Something doesn’t seem right. A sinking feeling sets in as you realize something has gone terribly wrong. [Click Here Now For This Urgent Prediction]( Perfect Partners In this way, "capitalism" and democracy are a perfect partnership, as each claims a noble cloak to obscure the actual machinery of elite self-service. The strength of democracy in system terms is it introduces a feedback loop that serves to limit systemically dangerous extremes, for example, a dictatorship that requires everyone to wear their underwear on the outside of their clothing. Or (ahem) a system like ours that has boiled away social mobility and financial security, leaving a rapaciously exploitive machine that feeds off persuading poor people to borrow even more money to convince themselves that they're not poor and powerless. The wealthy own the income-producing capital, the poor "own" debt: the wealthy own the mortgage/auto loan/student loan, the poor owe the mortgage/auto loan/student loan. Funny how neofeudalism works: The financial aristocracy is in the castle, protected by the Central State, and the debt-serfs are toiling away down there, protected by, well, no one. But by all means, vote for your favorite actor on the tawdry side-stage erected to amuse the public: what flourishes, what emotion, what comedy. (Please pardon the outburst of "truthiness." I'll try not to let it happen again.) The Only Pressure-Relief Valve If democracy is boiled away, the only pressure-relief valve and governor-on-greed left is messy uprising or a messy uprising plus the wholesale abandonment of the status quo by the technocrat class that keeps the whole thing glued together (what I call opting out). The prime directive in governance is to always, always, always centralize power to extend the reach of the elite currently at the wheel, and to limit the number of grubby hands trying to reach the wheel. Centralizing political power makes life considerably easier for elites, as they only need to bribe, blackmail or persuade a handful of folks at the top to cement their power/monopoly/cartel. I discuss this in my book Resistance, Revolution, Liberation. Consider the difficulties of cementing a quasi-monopoly on banking if banking were restricted to the county level. The would-be cartel grifters would have to bribe, blackmail or persuade 3,000-plus county councils, all of whom are far closer to voters and far more exposed to competition than federal regulators or the Federal Reserve or Congress-critters, who as we all know, are re-elected like clockwork except in a few cases that are basically signal noise. [[Revealed!] New AI Opportunity Bigger Than The PC?]( [Click here for more...]( Just imagine being able to turn back the clock to the 1980s – right as a new technology known as the PC was getting its start… Seeing the promise of the PC – and captivated by Microsoft’s technology – an early investor decides to put in $500 during the company’s IPO in 1986. As of today, that $500 investment would have turned into a fortune worth over $1.6 MILLION. I bring this up because we are at the dawn of a new innovation which could be even BIGGER than the PC. I’m talking about artificial intelligence, or AI. According to Yahoo Finance, “we are on the cusp of a technological revolution that will fundamentally change how we live our lives.” And you have the chance to invest on the ground floor… [Click Here To Learn More]( Subsidiarity This illustrates the value of Subsidiarity in a democracy, with Subsidiarity defined by the OED as "the principle that a central authority should have a subsidiary function, performing only those tasks which cannot be performed at a more local level." In other words, if a function can be performed at the local level, it should be performed at the local level. The Subsidiarity principle only works in a democracy if capital is also democratized. What's conveniently forgotten or left unsaid is: Capital always "votes" three times. 1) Capital's beneficiaries, allies and employees will vote to keep their gravy train running; 2) Capital influences the public with ad campaigns and public relations, all of which are quite affordable; 3) Capital influences the political/regulatory power players in private, aka lobbying, revolving doors between corporations and the political/regulatory agencies, junkets, farcically bloated speaking fees, etc. The only possible conclusion: If we don't democratize capital, democracy is boiled away. I wish this could be sugarcoated, but it's much like my other aphorism: if we don't change the way money is created and distributed, we change nothing. In other words, if we don't change the money/credit system and democratize capital, then all we'll ever have is more superficial feel-good policy tweaks: all sound and fury, signifying nothing. Where to Start It seems impossible at this point to decentralize power and capital, but with the pressure-relief valve and governor-on-greed of democracy both disabled, the system is starting to shake apart at the seams. I've often discussed the various classes and elites jostling for power in the U.S., and it's possible some elite might awaken to the necessity to restore the possibility that those with the vast majority of wealth and power might actually lose, i.e. restore real competition in the economy and our system of governance. This competition starts with the competition of ideas. Where to start? Here: The whole point of democracy and free markets is to force competition on elites who are desperate to eliminate competition. Regards, Charles Hugh Smith for The Daily Reckoning [feedback@dailyreckoning.com.](mailto:feedback@dailyreckoning.com) Editor’s note: For months, our federal overlords have tried to ensure us that the banking crisis was contained. [But Jim Rickards has just blown the doors off of this argument.]( Jim’s declared that a [new “Lehman Moment”]( could be just days or weeks away. And it’s critical you get the list of banks at risk BEFORE this moment takes place. This is your “ounce of prevention” that could potentially provide you your “pound of cure.” If you missed last evening’s live broadcast, worry not. There’s still time. You can catch the whole thing [here.]( You’ll learn not only how to prepare for the storm, but how to seize your chance to use this crisis for the potential chance at a fortune. But Jim says you must act by Monday morning, Sept. 18, by 9:30 Eastern. [Click here now for all the details, and you decide for yourself.]( Thank you for reading The Daily Reckoning! We greatly value your questions and comments. Please send all feedback to [feedback@dailyreckoning.com.](mailto:feedback@dailyreckoning.com) [Charles Hugh Smith] [Charles Hugh Smith]( is an American writer and blogger, and serves as the chief writer for the blog "Of Two Minds". Started in 2005, this site has been listed No. 7 in CNBC's top alternative financial sites, and his commentary is featured on a number of sites including Zerohedge.com, The American Conservative, and Peak Prosperity. [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 The Daily Reckoning e-mail subscription and associated external offers sent from The Daily Reckoning, feel free to [click here.]( Please note: the mailbox associated with this email address is not monitored, so do not reply to this message. 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