Hmmm…I’m not hearing a lot of support for my “Bag A Boomer” idea. I concede that it’s unconventional, but you gotta admit, it would help clear away the top of the pyramid. Alas, I will have to comfort myself with the certainty that I’m an unrecognized genius. Not.

It’s “all right” because all other world currencies are fiat money as well. As long as they all inflate their currencies at about the same rate, none collapses relative to the others, and everything is all right … for now. We’re all in the same boat, and the hope is that there is safety in numbers. But politicians have a perverse incentive to weaken their own currency in order to prop up exports or limit imports. They get to spend the money created out of thin air, and it ‘helps’ the economy as well! It’s a constant race to devalue the currency just fast enough to not cause a systematic failure.

All pyramid schemes are doomed to fail eventually. And the end of this one will come without much warning (other than from those pesky libertarian writers). Now, with capital flight from the remains of our manufacturing sector fully underway, the public sector having outnumbered the farming and manufacturing sectors long ago, and record numbers of people taking public assistance, I have to wonder how far off that day is. What Greenspan didn’t mention this week, as far as I know, is the risk that a sudden, deep recession in the United States could set off a worldwide depression, with the various fiat currencies tumbling like a house of cards.

What is more frightening to me than the prospect of a worldwide depression is the contingency plans that surely must have been laid to assume or maintain control in such a scenario. With such a great number of people already helplessly dependent on the government for their sustenance, I predict that these plans do not include a return to a value-based currency, more economic freedom, or any restrictions on government to prevent them from worsening and prolonging the problem.

–John Danforth–

Mr. Maguire, from one old crank to another, welcome.

Fact: Social Security is a pyramid scheme. Retirees are living too long and there just ain’t enough young’uns coming up to keep the scheme going. [Aside: In my state, when the deer herd has become too large in the past, the state has implemented a catchy “Bag A Buck” program to help reduce the size of the herd. I think a “Bag A Boomer” program might work wonders for Social Security – present readership excluded, of course.]

Medicare is worse than a pyramid scheme. With medical care, there is a supply of providers that is for all intents and purposes fixed. Making the services of those providers free to the consumer – well, the buck’s gotta get passed somewhere, and that somewhere ends with you and me.

Oh yeah, add in the cost of the Iraq war on top of everything else. Frankly, it’s amazing that this consumption binge has lasted as long as it has. I suspect that this “foreign debt” is akin to a few freebies from a drug dealer before a lifetime of addiction kicks in.

I’m an old crank before my time, I guess.