The US Is Now the United (Police) State of AmericaDoug Casey Doug: I doubt it would work; its a tough row to hoe, trying to explain things to people who are so set in their thinking that they truly and literally dont want to hear anything that might threaten their notions. A person who feels threatened by ideas and who responds with emotion is acting irrationally. How can we have a discussion with someone whose emotion trumps their reason? How do we even begin to untangle the thinking of people who will gather this week to give thanks for the bounty produced by freedom and hard work the famous puritan work ethic by eating a turkey bought with food stamps? But we can outline the ideas, for the record. Louis: Ill bring a copy if they ever do put you on trial for thoughtcrime which is frighteningly close to being real these days and called treason to boot. Doug: Its not just close; its here. Just try telling an unapproved joke in a security line in an airport these days. Louis: True enough. Where to begin? Doug: At the beginning. America was founded as a confederation of independent countries thats what a state is. Or was, in our language. The original United States of America was a confederation of countries that banded together for protection against larger and more powerful countries they feared might be hostile. This is not a disputed interpretation of history, but as solid a fact as the study of history produces and yet a largely neglected one. Louis: We did cover this ground briefly in our conversations on the Civil War and the Constitution. Louis: Another coup? Doug: More like an exposure of the first one for the whole world to see. But by then it was way too late. Despite this, the relative freedom of the US because it was for many years far freer than other countries made it possible for artists, engineers, inventors, and businesspeople to flourish and create a society more wealthy and powerful than any the world had ever seen. This is what I call the idea of America the America That Was. But the seeds of destruction were already sown at the very beginning with the Alien and Sedition Acts being perhaps the first highly visible step in the wrong direction. Then came the forceful assertion of one national government, with states reduced to administrative regions via the War of Southern Secession, from 1861-65. Im no fan of state governments, incidentally, but at least theyre smaller and closer to their subjects than the federal government. Another major step in the wrong direction occurred with the Spanish-American War of 1898, where the US acquired an overseas empire by force. The next major step downhill was the creation of the Federal Reserve and the income tax, both in 1913, just in time for World War I. It took time for these things to make the system crash, because it was still a fairly free economy. Louis: But crash it did in 1929 Doug: Yes. And it led to the Great Depression of 1929-46, which lasted so long entirely because of the unmitigated disaster of the New Deal (which we discussed recently). The New Deal injected socialist-fascist ideas into mainstream American thought like a poisonous acid, corrupting the heart of the idea of America that once made the place great. The process was completed with Lyndon Johnsons Great Society, which really established the basis of the welfare-warfare state. It truly set the stage for the total ethical, economic, social, political, and even military disaster now unfolding before our eyes. Still, the beating heart of the idea of America which is to say both social and economic freedom took time to corrupt. Like a strong man who doesnt know hes headed for a heart attack, American culture didnt really peak until the 1950s. The bullet-finned 1959 Cadillac is a symbol of this peak, in my mind. Louis: Then we had Johnson and his guns and butter policy War in Vietnam and War on Poverty at the same time followed by tricky Dick kicking the last leg out of under the stool by taking the dollar off an even theoretical gold standard. Doug: Yes. Nixon was arguably even a worse president than Johnson, with the devaluation of the dollar in 1971 and his creation of the War on Drugs. Things have spiraled out of control since then. In The Casey Report, weve written reams about these last decades and how they led to and shaped whats happening now. But I have to say, the focus has been largely financial. Louis: Which is as it should be, in a publication designed to help investors navigate these turbulent times. Doug: Yes, but the corruption goes way beyond that, beyond even the senseless wars and idiotic foreign policy we discussed last week. America, once the land of the brave and the home of the free, is well on its way to becoming a police state worse than any weve seen in the past, including the Soviet Union and Nazi Germany. Louis: How could it get worse than that? Doug: Because Big Brother has better technology now, allowing possible manipulation and control of the population that Stalin and Hitler never dreamed of. And because the US used to be such a great place, a lot of people have been tricked into believing its the same as it was. But theres no more resemblance between the America of old and the US of today than there was between the Rome of the Republic and the Rome of the later emperors. Furthermore, most Americans have conflated the government with society. Theyre not only different things, but often antithetical. Louis: I thought you said youre an optimist! Doug: I am. But thats for the survivors who make it through the wringer the global economy and every person on this planet is about to go through. I keep telling you that the coming Greater Depression is going to be even worse than I think it is. You may think Im joking, but Im not. I do think that, primarily for reasons we discussed in our conversation on technology, what comes next will not only be even better than I imagine, it will be better than I can imagine but first we have to go through the wringer. I see no way around it. I truly dont. Louis: Okay, I know you believe that. Can you substantiate the police-state claim? Doug: Well, rather than give you anecdotal evidence of which there are masses more each day let me refer to a rather perceptive blog post by a George Washington law professor named Jonathan Turley, titled 10 Reasons Why the US Is No Longer the Land of the Free. Im sure I dont see everything the way the professor does, but the list struck me as quite accurate and very important for people to understand. Louis: Im sure I dont want to hear this, but okay, shoot. Doug: [Chuckles] Maybe you dont, but I know you value the truth. These points underline something Ive said for years: the Bill of Rights is a completely dead letter. Its essentially meaningless and rarely even gets the benefit of lip service. Quoting it will result in derision, if not arrest as a dangerous radical. Frankly, I didnt think the civil liberties situation could get worse than it was under Cheney-Bush, but it has. Obama has repealed none of what they did and added more. So, lets go through the list. First: Of course the very concept of terrorism is highly malleable, with over 100 definitions floating about as weve discussed. But apart from that, its now accepted that the president and his minions have the right to kill almost anyone. This conceit will get completely out of control after the next real or imagined major terrorist incident. Louis: This reminds me of the extraordinary powers given to government agents to battle the War On Some Drugs like the RICO statutes which have now been turned against ordinary citizens who have nothing to do with the drug trade. Doug: Exactly. Once you give the state a power for whatever good reason you imagine it needs it it will use that power for whatever those in charge feel is in their interests. And those in charge are never saints. Next: This was a precedent set by Guantnamo, where scores of the accused continue to rot without even a kangaroo-court trial. As the government becomes more powerful, its completely predictable that everything including the justice system will become ever more politicized. And government very rarely relinquishes a power its gained. I particularly like the Supreme Court ruling in April 2012 that allows anyone whos arrested for anything including littering or jaywalking to be strip-searched. Louis: Note to readers: you cant hear Dougs voice, but I assure you that his use of the word like is sarcastic. Doug: Just so. Moving right along: Privacy is now a completely dead concept, from both a legal and a practical point of view. If you want to retain privacy, you now have no alternative to relocating outside the US. Louis: Or any advanced Western country. Ive read that there are more surveillance cameras per square mile in London than anywhere else. Doug: Ive heard that too. The opposite being true in rural Argentina is one of the things I like about it. Back to the list: National security essentially amounts to nothing more than government security, which amounts to cover for the individuals in the government. Nazi Germany and the USSR were national-security states. As Ive tried to explain in the past, once a critical mass is reached, its impossible to reform a government. I believe weve reached that state in the US. Torture by field operatives under the stress of combat is one thing; torture as official policy is something else again. But torture is now accepted in the US. Worse, there are far more serious war crimes than torture being committed in the name of the US that are going unpunished. Louis: This is, after all, a far darker version of the same US government that deliberately infected black US citizens with syphilis just to see what would happen, and sent US citizens of Japanese descent to concentration camps during WWII. Doug: Exactly. The next point is: You no longer live in a free country when theres zero privacy for citizens, but 100% secrecy for the government and those it employs. The government has outsourced some of its functions not least the use of contractors in war zones. Increasingly, being associated with the government gives you a get out of jail free card. In the USSR they called this a krisha a roof. Bad as this is, its just one example. Theres also the use of domestic drones, and hundreds of thousands of cameras that take pictures of everyone everywhere. Yes, if someone is kidnapped, theres plausible deniability if the torturing is done abroad by a third party. And theyre likely to have even fewer compunctions. Louis: Thats a pretty depressing list, Doug. Doug: And this is just the beginning. As Ive said before, I dont call the shots just try to tell the truth as I see it. The point is that you couldnt assemble a list like this even 15 years ago. But now its part of the firmament. Worse, its going to grow. As the economy turns down over the next few years, the people acting like scared chimpanzees will ask the government to do something. And it will. The trend is going hyperbolic. Louis: I cant argue and I agree it is not likely to be stopped. So if this is a sure trend, are there investment implications? Doug: This just goes to reinforce what Ive been saying for some time. As great as a US citizens risk is in the marketplace these days, the greatest single risk to their wealth and health is the government. People simply must internationalize to diversify their political risk. I cant stress that strongly enough. Louis: Would you go so far as to say that being a taxpayer in the US now is like being a Jew in Germany in the mid-1930s? Doug: Thats a good analogy. Its costly and upsetting to uproot, but the risk if you dont is unimaginably worse. And I would warn people in other countries to take the same precautions. All of these nation-states are dying dinosaurs that will cause a lot of damage as they thrash about in their death throes. No place is completely safe, but you improve your odds by not putting your eggs all in one basket. Louis: Okay, I guess weve covered that plenty of times. Is there a police-state play any investments one could make before the new Iron Curtain slams down? Handcuff manufacturers? Doug: Nah they have those plastic zip-binder things now; theyre so cheap that I doubt the manufacturer can even make big money in volume. But I do remember a speech I attended in the 90s given by William Bennett, the ex-Drug Czar, who recommended investing in prisons. I excoriated him as a sociopath at that meeting but he was right. However, that ship has sailed; its hard to believe the US can incarcerate more than the current 2.3 million people. Besides, I find it morally offensive to capitalize on what I consider to be criminal enterprises. No, for now the only absolutely crystal-clear imperative is as above: Youve got to have a Plan B ready in case you need to get out of Dodge and you need it pronto. And to those who celebrate Thanksgiving, I urge you to remember that it was hard work and the freedom to profit from it that created the bounty the pilgrims celebrated. It was this enterprising spirit and the liberty to exercise it that was the heart of the idea of the America That Was the idea that made America great. Those corrupt politicians who have been undermining these values for so long and the willfully ignorant ideologues who support them are responsible for turning this country into the United (Police) State of America. They should be criticized and opposed at every opportunity. Louis: Okay, Doug. Thanks for another challenging but enlightening conversation. Doug: My pleasure. Doug Casey a renowned contrarian investor and speculator, and a highly respected author and public speaker has never been afraid to speak his mind. His staunch free-market advocacy make his ideas a welcome respite from the ongoing calls for more government interference for many. Agree or disagree with Doug, he will give one something to think about and on subjects as diverse as the TSA; health and the state of health care in the US; speculative fiction; capitalizing on corruption; war; charity; and many more. Right now you can get a terrific deal on Doug Caseys ideas and insights: his first book in 15 years, aptly titled Totally Incorrect, is due out in early December. Learn more about Totally Incorrect and pre-order your copy plus a few for gift-giving today at a great discount. 