Future of America - Political & Economic

End of America as We Know It?

When I ask the question about whether we will see the end of America, I am not suggesting that we will see the physical end of our country or even the loss of its name. What I am wondering is, will we see the end of America as we know it.

America is in deep trouble. Tax revenues are not even coming close to expenditures. Government regulations seem to be growing even worse against capitalism. Entrenched groups are creating insane policies.

Around half a century ago, Ayn Rand predicted that America would arrive at this point. How was she able to predict this? The answer is through a strong understanding of philosophy, economics, and politics. Ayn Rand understood that the Republican party was in favor of corporatism and war, while the Democratic party was in favor of big social programs. This meant that both the Republicans and the Democrats were in favor of big government, they were just fighting over what type of big government.

And this is what we have witnessed for many decades. Government continues to grow bigger with even more complex laws. Prisons and jails continue to grow, while the war on drugs enriches many government agencies. Our war on drugs has grown so huge that it is even beginning to destabilize Mexico.

This century we attacked a foreign country under the pretense that they were producing weapons of mass destruction. This was done despite the fact that military satellites can easily detect small amounts of radioisotopes, so we knew that Iraq was not trying to refine uranium.

As an example of the difficulty of hiding such an endeavor, Iran has spent billions of dollars to build multiple complexes working on refinement of U-235 and it is still taking them years to reach their goals. These complexes are easily discerned by satellites. Iran doesn't even attempt to hide what they are doing. Do you really think that Iraq could have been secretly building nuclear devices?

It's Raining Money!
It's Raining Money!

The Breaking Point

Any one of the above problems could be dealt with in isolation. It is the interaction of them that is pushing America into a disaster. Our military power protects us from any foreign occupation or attack, but it will not protect our economy.

And that is what will destroy the America that we know in the end. Right now, our economy is surviving on large injections of money. Unfortunately, this is like keeping a person working without sleep by giving him amphetamines. It keeps taking more and more drugs to keep him going.

Stop giving him drugs and he will collapse from exhaustion. But continue to give him drugs and he will eventually do the same, but only worse. But like a drug addict that just can't stop his habit, America is just using more and more stimulus money to keep going. The final result may be delayed, but the final suffering will be worse.

How Bad Can it Get?

So how bad can it get? The truth is that I don't think anybody knows. But we can look to other countries as an example. When inflation gets out of hand, luxuries become very cheap, while food and fuel become very expensive.

Savings, pensions, and fixed income could become worthless. If you can get out and perform any kind of work you will probably obtain enough food to eat. Farms will still probably produce food, you will just need to find something to trade for it.

The secret to surviving hyper-inflation if you are not prepared is to understand that before the invention of money, we had barter. You will need to trade something for food, whether that is land, property or labor. But it will need to be something of value to the recipient.

Money has two main purposes. One is as an efficient means of trade, the other is as a way to store wealth. Silver and gold did both in the past. Today, we use paper and it is losing it's ability to store wealth. As more and more people realize the problem with paper currency, they will try to spend it faster and faster. Eventually, a time will come when it cannot be used anymore.

The best way to prepare for hyperinflation is to have some silver and gold in reserve somewhere. You should also have a year worth of food staples like beans and rice.

Hyperinflation does not last forever. Once it gets started, it takes a couple of years to completely destroy a currency. Your extra food doesn't have to last forever. In the meantime, you can still earn some money and immediately spend it for necessities. Other options are to barter or to grow your own food.

Most people are overweight and this will reduce their need for food. About 40% of the food in America is wasted and certainly that would end during a hard time. Most of us can survive off about 50% of what we normally eat. Combine the two together (.6 * .5) and we can survive with only about 30% of the food that we normally need. We could also buy raw materials like flour and oil to make our own bread. I estimate that I could survive on only a dollar a day in food if I needed to do so.

I suspect that we will have a few riots in larger cities when food supplies are interrupted, but most people that avoid them will be okay. The smarter people will just move out the largest cities before things get really bad.

Silver Coin Economy

I lived in Oregon in early 1979 when inflation started to worry some people. The most interesting thing at that time was that about one in five stores starting to accept silver coins for purchases. Eventually, you could buy hamburger or a burrito for about two dollars or one silver dime.

There were signs everywhere with alternate prices listed in silver coins. Many places started to accept silver coins at a 10 times ratio, eventually rising to a 20 times ratio before dropping again, then eventually the signs disappeared as people regained some trust in the dollar.

I suspect that the same thing will happen again if we start to see serious inflation. People will start to offer a premium price for silver or gold coins. And if (or when) we get hyperinflation, then most stores and businesses will switch to silver and gold coinage.

The silver and gold holdings of private citizens in America may actually end up saving America from it's government. We may end up with two economies. The old economy of government workers and welfare recipients will be using a dying fiat currency, while a new and efficient economy is born that relies on silver and gold coins.

Some states will probably embrace the new economy and be reborn. Other states will fight the silver and gold economy and destroy themselves in the process. If you are living in America, be sure to move to one of the reborn states.

Here are some hubs related to economic survival:

Basic Investing 101
The Best Expatriate Country for You
Best State to Be Homeless

One Potential Future

The Day the Dollar Died

More by this Author


Comments 7 comments

Pamela Kinnaird W profile image

Pamela Kinnaird W 4 years ago from Maui and Arizona

I really liked your simile about the drug addict. This is an evergreen article even though some people may not know the severity of it. I lose sight of it all the time. Voting up, useful and interesting.


CHRIS57 profile image

CHRIS57 5 years ago from Northern Germany

Pente - i am with you that it is always good for a currency to hold value over time.

But still, it can´t be achieved by returning to the gold standard. The reason is simply that producing industries of today are so efficient and productive, they create so much value in such a short period of time, gold production, gold mining can´t keep up.

So sticking to gold, silver or other commodities will have the immediate effect of hyper deflation.

Just to give you an idea of how small gold reserves are: Fort Knox holds some 240 billion USD in US Gold. That is less than the market capitalization of Apple, and Apple would still have change to buy Boeing. There is an estimated 600 billion USD of gold in private households (i assure you my wife only holds a tiny, tiny fraction). Still all that gold and silver and ..is just a fraction of how much would be needed.


Pente profile image

Pente 5 years ago from Planet Earth Author

I have to disagree with the idea that there is to little silver and gold to act as money. The reason silver and gold was used as money in the past is that it can be easily divided into smaller portions. The supply/demand curve will adjust the value of them as needed.

Even if I am wrong for some reason, we could use other metals as currency too. Maybe copper for small purchases.

The point is that we need a currency that is not only used for trade, but also holds its value over time. That is the major problem with fiat currency. Fiat currency loses value over time and cannot be used to store value.

When I was a kid, I bought candy bars for a nickle. Within just a few years their price went to 10 cents and then 15 cents. I quickly realized that the interest earned on money would never keep up the rise in prices. I didn't learn the causes of inflation till I reached my teen years, but I definitely understood that it was better to store my earnings in a non-cash form.


CHRIS57 profile image

CHRIS57 5 years ago from Northern Germany

Excellent analysis, enjoyed that very much.

The thing about hyperinflation and how to cope with it is a little more complex, if i may say. There is just too little gold and silver around to serve as replacement. So there has to be a lot of bartering (you can have my pair of shoes and i get your bag of potatoes). This is black market trade and certainly minimizes government revenues and taxes.

Look into the history of Germany (early 20ties and after WWII), that is first class field experience of hyperinflation.

I personally witnessed the hyperinflation of post Perestroika, early Yelzin years in Russia. Money devaluating on daily basis, desperate people bartering used tooth brushes in the Metro exits of Moscow.

Those countries and people got over it. What makes me worry is the fact the US is absolutely unprepared for cold turkey. In that respect the mindsets of Germans and Russians were much better prepared. It is easier to go from little to nothing than from plenty to nothing.


Brie Hoffman profile image

Brie Hoffman 5 years ago from Manhattan

Yea Pente, I'm keeping that extra supply where no thieves can take it..on my body! :)


Pente profile image

Pente 5 years ago from Planet Earth Author

Hi Brie! Maybe Detroit??? You might just try waiting. Land falls behind the cost curve during high inflation. Also, I think anybody who keeps a year supply of extra food will probably be okay.


Brie Hoffman profile image

Brie Hoffman 5 years ago from Manhattan

Excellent article..voted up! Utah is already accepting silver and gold for currency as are some private businesses. The only problem I'm finding is acquiring land that is affordable to be able to grow food on...any suggestions?

    0 of 8192 characters used
    Post Comment

    No HTML is allowed in comments, but URLs will be hyperlinked. Comments are not for promoting your articles or other sites.


    Click to Rate This Article
    working