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The One Solution to All Our Problems

This is a syndicated repost published with the permission of oftwominds-Charles Hugh Smith. To view original, click here. Opinions herein are not those of the Wall Street Examiner or Lee Adler. Reposting does not imply endorsement. The information presented is for educational or entertainment purposes and is not individual investment advice.

Pick one, America: national security of the essential material foundation of everything, the industrial base, or “global markets,” maximizing greed / corporate profits.

Sorry about the clickbait title. We all know there isn’t “one solution” to anything as complex as a socio-economic-cultural-political system.

But this is based on looking at all the problems from one very shaky perspective: that the foundations of any solutions are rock-solid and all we need to do is apply some ideological or financial fix and away we go.

From another, much more practical perspective, if you don’t keep the foundation–the industrial base–glued together, then all the high-minded ideological or financial fixes will all be completely, utterly meaningless. When the generator breaks down and can’t be fixed due to a lack of critical spare parts, that isn’t a problem that has a “Progressive” or “Conservative” fix. Printing money and tax breaks won’t fix it either. And neither will ideological fixations like “global markets.”

Financial gimmicks and global markets are what got us into this mess in the first place. Greed is good until you sacrifice your national security and industrial base for a few extra bucks.

From this perspective, there is one solution to all the problems, because if you don’t fix the industrial base then the whole shebang collapses. All those little things like a judiciary, law enforcement and food supply system all rely on a functional industrial base, by which I mean the interwoven industries that made the millions of essential parts and components of a complex industrial economy.

We all know about fuel and fertilizer, but when you look beneath this superficial surface you find a bunch of stuff without which the entire industrial machine breaks down.

Here is a partial list of the stuff you need or your industrial base collapses in short order:plastics, sealants, solvents, lubricants, gaskets, O-rings, filters, and an astoundingly long list of highly specialized ceramics, wires, piping, fabrics, glass, steel, lenses and so on.

To a sobering degree, much of this essential industrial base has been offshored because “greed is good” and corporate profits are more important than the security of the nation’s industrial base. Becoming dependent on frenemies’ industrial base is (pick as many as apply): short-sighted, stupid, foolish, insane, traitorous.

The problem isn’t just the loss of the capacity to make the stuff we need to keep the whole system from collapsing; it’s the loss of the capacity to make all the parts and components. All complex systems, including machines, fail when a critical component fails or a critical fluid runs dry. The machine can be 99.9% functional but the missing 0.1% means the entire machine is down.

Most people are unaware of just how dependent we are on specialty parts produced in only a handful of factories.It simply isn’t profitable in the “global marketplace” to produce small batches of parts. The “greed is good” / maximize profit ideology leads to stripping away redundancies and costly local suppliers in favor of a distant supplier totally within the control of frenemies’ governments.

Consider the supposedly low-tech kitchen counter toaster. These are cheap, so they must be easy to make, right? Wrong. They’re impossible to make without a highly sophisticated industrial supply chain. Thomas Thwaites attempted to make a toaster from scratch and found it was impossible to do so. He described the experience in his book, The Toaster Project: Or a Heroic Attempt to Build a Simple Electric Appliance from Scratch.

Even the simple kitchen toaster requires highly specialized materials from a handful of sources. There is nothing low-tech about the specialty wires, ceramics, etc. needed to manufacture or repair a “simple” toaster.

The one solution without which no other solutions are possible is to reshore our essential industrial base and supply chain as a matter of the highest national security. Production deemed essential to National Securitymust be located in the U.S. and owned and operated by U.S. firms.

Ideological purists freak out at the prospect that “greed is good, markets fix everything” has failed the nationbut these blinded-by-ideology purists overlook how government funding via DARPA, NASA and DoD (Department of Defense) was the one and only driver of the development of microprocessors and the entire semiconductor industry. There was no private-sector market to enable greed, and no way that individuals in a garage could fabricate the first microprocessors. All the really hard stuff was funded lock, stock and barrel, by DARPA, NASA and DoD–government agencies devoted to national security, which includes the government’s role in fostering and nurturing innovation. (DARPA was ARPA back in the day).

Pick one, America: national security of the essential material foundation of everything, the industrial base, or “global markets,” maximizing greed / corporate profits. You can’t have both. Choosing “global markets,” maximizing greed / corporate profits has left the nation catastrophically vulnerable in ways few even grasp because they don’t understand the fragility of the material foundation of all the goodies and systems they wrongly assume are a permanent birthright. They aren’t.

We’re getting a taste of the inherent instability of our dependence on “global markets” / maximizing greed, but the full banquet of consequences has yet to be served.

When the machine breaks down due to lack of essential parts, the magic goes away. Do those behind the curtain understand this? Apparently not. Maybe we need a few engineers behind the curtain instead of relying on financiers and legal experts for leadership.

Recent podcasts/videos:

Tectonic Shift of Mercantilism Revalued (Gordon Long, Macro-Analytics, 42 min)

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