by Brandon Smith at Alt-Maket.com
With the Crimea referendum passed and Russia ready to annex the region, the United States and the European Union have threatened sanctions. The full extent of these sanctions is not yet known, and announcements are pending for the end of March. If these measures are concrete, they will of course be followed inevitably by economic warfare, including a reduction of natural gas exports to the EU and the eventually full dump of the U.S. dollar by Russia and China. As I have discussed in recent articles, the result of these actions will be disastrous.
For those of us in the liberty movement, it is now impossible to ignore the potential threat to our economy. No longer can people claim that “perhaps” there will be a crisis someday, that perhaps “five or 10 years” down the road we will have to face the music. No, the threat is here now, and it is very real.
The loss of the dollar’s world reserve status will destroy the only thread holding up its value, namely, investor faith. There are only two possible outcomes from that point onward:
A) The U.S. will be forced to default because no nation will purchase our Treasury bonds and support our debt spending, causing the dollar’s value to implode.
B) The Fed will choose to restart and expand quantitative easing measures, confiscate pension funds, raid bank accounts or issue new taxes in order to keep the system afloat; this will also end in the eventual collapse of dollar value and hyperinflation.
The consequences will lead to an explosion in prices — first in commodities and necessities like petroleum, imported raw materials, food, electricity, etc. and then in all other goods and services. Austerity measures will be instituted by Federal and State governments. Cuts to social welfare programs, including food stamps, are probable. Civil infrastructure will suffer. The cost effectiveness of maintaining public utilities could become unrealistic. Anyone relying on such services may find themselves cut off for days, weeks or indefinitely. Public suffering will invariably rise, along with public crime.
If events like Hurricane Katrina in New Orleans are any indication, the Federal government’s response will be inadequate, to say the least. The Federal Emergency Management Agency clearly cannot be relied upon to provide food, shelter, medical care or protection for communities. In fact, in the aftermath of Hurricane Katrina, the Feds did far more harm than good, corralling people into camps where death was rampant and disarming outlying neighborhoods so that they could not defend themselves. Tens of millions of dollars in donated and Federally purchased necessities were never delivered to aid survivors. Trucks were turned away, and help from civilian sources was denied.
The point is, if you find yourself in the midst of a national or international catastrophe, you should assume that you will be on your own with whatever preparations you made beforehand. To assume otherwise would be foolish, given our government’s track record.