Our Crisis of Competence

Do We Have Too Much Money? [The Daily Reckoning] June 08, 2024 [WEBSITE]( | [UNSUBSCRIBE]( Our Crisis of Competence The Hawaiian Islands Editor’s note: Do we have too much money? A silly question you ask — no one can have too much money. But today, Charles Hugh Smith shows you why he believes excessive money and credit can be a social ill. [Charles Hugh Smith] CHARLES HUGH SMITH Dear Reader, Money being scarce saves us from many pernicious forms of mischief, and having too much money/credit leads to catastrophe. This is of course the exact opposite of the conventional belief that having lots of money makes life not just easier but expansive and, well, as perfect as human life can be. On the scale of nation-states, having too much money/credit leads to the catastrophe of wars of choice, as having a couple million silver ducats to play with opens the door to imperial temptations, for example, assembling a great fleet of warships and sending this Armada to conquer troublesome England. I just finished reading what is likely the definitive account of the Spanish Armada: Armada: The Spanish Enterprise and England's Deliverance in 1588. Digging deep into the extensive archives of the era, the authors' translations of Philip II's voluminous correspondence make it abundantly clear that the galleons of silver arriving annually from Spain's colonies in the Americas gave the empire and its leadership the means to conduct ongoing wars in the Netherlands and Italy. Too Much Money Leads to Recklessness It also let them conquer Portugal and its island possessions, defend the empire's far-flung holdings in the Caribbean and the Philippines as well as entertain a variety of other costly imperial schemes. These range from a proposed invasion of a chunk of China (Philip II wisely passed on this request) to establishing a fort to defend the freezing, windswept Straits of Magellan from interlopers seeking to plunder Spanish holdings in the Pacific. (This project rather predictably ended in disaster and was abandoned after squandering treasure and lives.) Sending an invasion fleet to conquer England was a two-fer for Philip: a holy war to return Protestant England to the Catholic faith, and a means to root out the piracy of English privateers at the source. Without the millions of silver ducats jingling in his pockets, Philip would not have been able to pursue yet another costly military adventure. Updating the dynamic of too much money/credit leads to catastrophe, had the U.S. lacked the ability to borrow a couple of trillion dollars to fund wars of choice in Iraq and Afghanistan, those wars would have remained pipe dreams of the neoconservatives bent on a secular version of a "holy war" to impose "our way of life" on other nations (never mind nobody else could afford such extravagance). [Urgent Broadcast: Apple’s 10x AI Announcement]( [Click here for more...]( Apple is slated to make a major announcement on Monday June 10, and it’s rumored to be the release of the AiPhone. This would be Apple’s first official AI product, and it’s likely going to disrupt AI and the tech industry in a way we’ve never seen. But that does not mean Apple is the only company slated to profit. Instead, Silicon Valley insider James Altucher has his eye on a tiny AI stock that could prove crucial to the AiPhone, and has the potential to grow 10x over the next 12 months as a direct result of Apple’s announcement. [Watch His Briefing Here]( The Evils of Excess In the private sector, we might glance at Facebook/Meta's disastrous squandering of billions of dollars on a quixotic race to scoop up the mythical treasures of virtual reality, a quest that would have bankrupted a company with a smaller pile of ducats awaiting the misadventures of the leadership. All of which leads us to the present, and America's catastrophic splurging with the nation's credit card, a card with no upper limit, or so it seems, until it's too late and the interest payments ruin the party. Scarcities of resources, time and cash force innovation, experimentation, discipline, accountability, deferred gratification and resourcefulness because these are the only affordable problem-solving tools available. In contrast, an abundance of ducats and credit encourages the sins of procrastination/avoidance of hard choices, narrative control as a substitute for actual problem-solving, loss of accountability, delusions of grandeur, the destruction of discipline and the normalization of corruption. Having too much money/credit also gives free rein to all the classic sins: excessive pride, unbridled greed, wrath (take out the frustrations of failure on weaker parties), envy/class warfare, lust for power, gluttony in all things and sloth/incompetence/waste. The Best Thing That Could Happen to America? The best thing that could happen to America would be the destruction of its credit card and a deep, prolonged recession that emptied the punch bowl of phantom bubble wealth and the illusion of endless credit. Once the ducats and credit disappeared, then we'd finally be forced to start actually solving problems rather than papering them over by borrowing and squandering additional trillions. Once seated at the banquet of consequences, we'd be forced to surrender the delusion that narrative control accomplishes anything other than putting off the inevitable reckoning. Could too much money/credit actually be part of the crisis in competence we’re seeing these days? It might sound like a strange question, but hear me out. America is mired in a crisis of competence that can’t be ignored, even if no one wants to address it. Why Can’t Anything Get Done? Relatively straightforward infrastructure projects now face years or even a decade of delays/zero real-world progress. I can name several projects in my county where the environmental impact studies and various governmental reports have consumed six years, during which the harbor remains closed, the roads are unpaved gravel, the park is closed and the bridge is awaiting repairs. When the public rightly complains of years of inaction and foot-dragging, local officials throw up their hands in frustration as all the necessary approvals and funding must wind their way through the impenetrable thickets of state and federal agencies, a leisurely process over which they have no control. [Bad News for Trump]( [Click here for more...]( Former advisor to the CIA, the Pentagon and the White House Jim Rickards just released [this election bombshell.]( 99.99% of Americans don’t even know this book exists. It’s published by the Senate Committee on Homeland Security and Governmental Affairs… And it contains intel that Jim believes will play a critical role in what he’s calling [“the coming election meltdown.”]( [Click Here To Learn More]( As for the private sector, I've often detailed the immense, systemic decline in the quality of everything from the ingredients in packaged food to "stainless steel," as well as the equally immense burden of unpaid "shadow work" demanded of us all just to manage the complexity thickets generated by "progress." No wonder Cory Doctorow's descriptive ens**ttification is the "word of the year." More accurately, it's the word of the decade or the entire era. Can we dredge up the wherewithal to be honest for a change and admit that "can do" has decayed to "can't do," as everyone expresses their powerlessness to move anything along with any awareness that time and money are limited? We've reached a state of sclerosis in which near-zero actual progress is deemed not just acceptable but "the best we can do" for a variety of reasons. Process Over Results Of course it’s not all about the problems that spring from having too much money. One reason is the supremacy of process over results. The system incentivizes and rewards following process, no matter how senseless, inefficient or wasteful that process has become. Those who have mastered narrative control (i.e. "Look how wonderfully we're following procedures") and avoidance of accountability for actual results are advanced, and those who chafe at the rank insensibility of overregulation and processes that prioritize stakeholders' input to the point that nothing gets done are sent to bureaucratic Siberia or quit in disgust. In this way, the system self-reinforces its most crippling weaknesses. One example is addressed in the article “Departing House Members Ask: 'Why Am I Here?'” A wave of retirees from both parties, including committee chairs and rising stars, say that serving in Congress is no longer worth the frustration. A great many things are no longer worth the frustration, and an even greater number of things are no longer worth the price being demanded. Once upon a time, before globalization (aka arbitraging lower labor costs and lower quality to increase profits) and financialization (aka the rich get richer by doing nothing) rose to domination, every product cycle delivered improved durability and utility. Now every product cycle delivers reduced durability and less utility, though this is obscured by a flood of "features" that degrade our experience. Competence has been reduced to 1) increasing profits this quarter; 2) narrative control/social media visibility and 3) following process. If this is what passes for competence while we cheerlead "the Roaring ’20s," then our delusion has reached what looks like a permanently high plateau. Like what you’ve read? [Go here]( for more. Regards, Charles Hugh Smith for The Daily Reckoning [feedback@dailyreckoning.com.](mailto:feedback@dailyreckoning.com) Editor’s note: On Thursday night AI wiz James Altucher went live to discuss [Apple’s big 10X AI Announcement.]( Did you catch it? Here’s the deal: On Monday, June 10, Apple is expected to officially announce their very first foray into artificial intelligence. This announcement has higher stakes than the release of the iPod… the MacBook… even the iPhone. That’s because it has the potential to send [one tiny AI stock soaring 1,000% over the next 12 months.]( Or even 10,000% higher over the next decade. Those in attendance are now some of the only people prepared to target a life-changing gain this coming Monday. But James understands that life gets busy and you might have missed his urgent announcement. That’s why we recorded this event. You can watch the replay now: [Click here or on the image below.]( [click here to play]( 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]( © 2024 Paradigm Press, LLC. 1001 Cathedral Street, Baltimore, MD 21201. 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. We welcome comments or suggestions at feedback@dailyreckoning.com. This address is for feedback only. For questions about your account or to speak with customer service, [contact us here]( or call (844)-731-0984. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized financial advice. We allow the editors of our publications to recommend securities that they own themselves. However, our policy prohibits editors from exiting a personal trade while the recommendation to subscribers is open. In no circumstance may an editor sell a security before subscribers have a fair opportunity to exit. The length of time an editor must wait after subscribers have been advised to exit a play depends on the type of publication. All other employees and agents must wait 24 hours after on-line publication or 72 hours after the mailing of a printed-only publication prior to following an initial recommendation. Any investments recommended in this letter should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company. The Daily Reckoning is committed to protecting and respecting your privacy. We do not rent or share your email address. Please read our [Privacy Statement.]( If you are having trouble receiving your The Daily Reckoning subscription, you can ensure its arrival in your mailbox by [whitelisting The Daily Reckoning.](