The Wages of Economic Stupidity

"I rudely barged ahead by saying, 'What we are going to learn is that the "wages of sin" may be death, as the Biblical saying goes, but the "wages of economic stupidity" are where actually dying is taking the easy way out'"

by The Mogambo Guru

I once met James Howard Kunstler, made famous as the author of The Long Emergency, in a bar, and I think he implied that I was not as stupid or repugnant as he was led to believe, and although he did not actually, you know, use those exact words, you could kind of tell that is what he meant, if you thought about it long enough.

Anyway, he has a new essay titled "Back to School" at 321Gold.com. The title refers to the line, "America, you're about to go back to school the hard way."

I raise my hand and say, "Mr. Kunstler, I am struck by the use of the word 'school', which seems such an odd metaphor to use to refer to the economic calamity beginning to engulf us, and thus I am enlightened at how different our childhood backgrounds are! After hearing this, I realize that I had it pretty cushy as a teenager, as going to school did not mean rioting, wars, mass bankruptcy, unemployment, shortages, suffering, starvation and wholesale misery, except for the misery I caused for my school classmates who were my enemies for any of a whole variety of reasons, such as (for instance), because they had nice cars, or were popular, or even who sat near me in class, but who paid, one and all, for their folly! Hahaha!"

Horrified, Mr. Kunstler instantly realized his mistake in thinking that everyone would obviously comprehend his point that the "going back to school metaphor" was used to mean that we are going to learn something educational.

But I am way ahead of him, and I rudely barged ahead by saying, "What we are going to learn is that the 'wages of sin' may be death, as the Biblical saying goes, but the 'wages of economic stupidity' are where actually dying is taking the easy way out, you little cowards, as the economy is a living hell. Where the living envy the dead! Envying the dead! Who are in hell! How freaking bad does it have to be when you are jealous of people who are freaking dead and in hell? Very, Very Bad (VVB)!!! I mean, look at the use of three exclamation points, for God's sake!"

Mr. Kunstler, in a panic, immediately and cleverly switches to a new tack, and with a completely different metaphor, says, "Bad financial paper, like rust, never sleeps." Well! That's more like it! Exactly! Now we're talking! I am relieved to silence, which is probably what he wanted to start with.

Wanting to get back on his good side, I interrupt to congratulate him on the revised metaphor, and I say, "I comprehend the delicate use of the metaphor that rust makes things rot away, like plumbing pipes, sometimes to the point where there is a leak, and then you call in a plumber who (for some reason) thinks you have a million spare dollars just sitting around in dusty bank accounts or something, and who thinks that you ought to give HIM a big chunk of that money to fix that one lousy little leak!

"And so you tell him 'Oh, yeah? Well, screw you!' and you try to fix it yourself, which goes along pretty well for a while until something (I don't know what) somehow goes awry, and now there are several leaks. So you call the plumber back, and he says that to fix five times more leaks is only going to cost me twice as much!"

He looks at me with a pained look that said, "What in the hell? Who IS this moron and why is he always interrupting me?" So I attempted to explain that my problem is that "My long familiarity with statistics figured the new way, the official way, the Federal Reserve way, the U.S. government way, allows me to quickly realize that with the price per leak dropping as the number of leaks rises, then the whole job will be done for free if I can poke enough holes in the pipes, right? Right? So, I should go around the house poking holes in the water pipes?"

A strange look crosses his face, and again he switches tacks in his growing desperation to either get me to shut up or just go away. Thinking for a moment, he decides to talk about the money and what is going to happen. "The scores of billions of dollars and euros that central banks have poured into the maw of losses lately," he writes, "will only paper over the essential problem for another few weeks, at most. The damage to global structured finance has been done, and it can be stated rather precisely: a widespread recognition that it's not possible to get something for nothing, after all. And that when you hold a lot of paper that was gotten for nothing, and put it up for sale, nothing will be offered for it. What a surprise."

I don't know if he was referring to me or what, but he surprisingly said, "I apologize for what has been a rather excessive spewage of mixed metaphors this week, but the extreme abnormality of events has just got me going."

And what does he mean by "extreme abnormality"? "Sooner or later, though," he explains, "millions of shlubs dependent on pension checks, or annuities, or monthly payouts of one kind or another will notice that something has stopped landing in the mail box. Repo men with bad haircuts and tattoos will be driving other peoples' cars to the auction barn."

In a weird piece of happenstance, his last point was made last week when I was at a party, and a guy named Ricky told me that he unfortunately doesn't have a spare $50 to loan me, or even $20, or even $5, but he said that maybe I could make some money by helping a guy he knows who is in the repossession business, and he is making a freaking fortune these days with all the repossessed cars and stuff he is picking up, and so I naturally told him, "I want fifty bucks, not a stupid job, you moron!" and the guy was real cool towards me the rest of the night, like I care if some lowlife deadbeat, who doesn't even have a lousy $5 to loan a complete stranger like me, likes me or not.

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The Mogambo Guru is quoted frequently in Barron's, The Daily Reckoning and other fine publications.

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