Capitulation by Capitulation (is How Societies Die), or Where America is Now

They did it again. The Democrats. They capitulated. Their own base is furious at them, rightly so. Let’s review for a moment: they gave in at a crucial, accomplished nothing, won nothing, and now the Republicans are poised to take healthcare away from millions of Americans. Worse, their party fractured.

What are we to make of this? This is going to be bit a dense and long read. Sorry about that. Please try and stay with me, take breaks if you need to, go ahead and scream now and then, let it out, then come back, because I am going to try and teach you things you need to know now. We’re going to discuss capitulation, first politically, then financially, then macroeconomically, then geopolitically.

Capitulation: I’m glad to see people finally using that word, because it’s the correct one. “Caved” or “failed” do not convey the gravity of the situation. I’m going to discuss capitulation in detail conceptually for you soon. But for now, we’re going to discuss what such capitulations mean, and do. Because capitulations like this, this grave—they matter intensely.

How do societies die? How do fascist collapses happen? Capitulation by capitulation. I want you to understand that, to really grasp it. Every capitulation which occurs is collapse happening before your eyes. But not all capitulations are created equal. Some are breaking points for a society. Was this such an event?

In America, this is just the latest of a wave of capitulations, from universities, to the press, but it is in a sense, the culmination of that wave, because here we have the opposition party itself capitulating, which of course is far more pernicious and damaging, since it is the last bulwark of democratic institutional power. So: when politics itself capitulates to the forces of collapse, to authoritarianism and fascism, then we have reached a key turning point in the misfortunes of a society. I will come back to that, if it sounds too much.

Now. You must understand what is different about capitulation. Why it isn’t just “caving” or merely negotiations gone wrong or what have you. It is, among other things, is a humiliation. It is the result of intimidation. And what it says is something stark, dire, and ominous: that here lies a shattered thing, a broken institution.

Capitulation is therefore a form of shattering, if you like. It is what we call what broken institutions do, in order to break. Institutions may be dysfunctional, or paralyzed, or fall victim to any other number of maladies. But none of these approach the level of capitulation, because when we say a thing has capitulated, we mean it has given up. It has been broken. And having been broken, it will no longer be capable of offering much resistance to authoritarianism or fascism.

Think of institutions as foundations holding a society up. When they capitulate, they break. And like foundations, there is a crucial point at which too much capitulation finally destabilizes a society completely. And we must ask: where is that point?

Now. Let us apply that to the Democrats. They capitulated to the Republicans…over what? Over extensions to the pathetic excuse that passes for healthcare in America, at least compared to every other rich nation, and plenty of poorer ones, too. And over other remaining fragments of the barely-extant safety net, like food aid.

The question any rational mind should be asking is: how much does all this cost, anyways? I’ve scarcely seen that question asked once, which is a testament to just how degraded American thinking has become. But let me answer it for you. Extending healthcare for 2 years would cost $60 billion, which is 0.2% of GDP, which is less than a rounding error.

If we add food subsidies to that, it scarcely adds anything at all, bringing the total to maybe half a percent of GDP, which, again, is a rounding error. But these are not just rounding errors. They are the basics of life for millions of people.

This is what the Democrats capitulated over. They capitulated to authoritarianism and fascism, and what they capitulated over? Was nothing at all. Less than half a percent of GDP.

They could not even stand up for that much. So how will they stand for anything more?

You see, this was no mere capitulation. It makes people incandescent with anger for a very good reason. Here we have a set of costs so tiny to the larger economy, they are mere pennies. Meanwhile, they provide a lifeline, quite literally for millions of people. And the Democrats couldn’t even muster the courage or strength to stand up for that.

Pennies, but of the most vital kind, which become bread and medicine for people who desperately need them. If they can’t stand up for pennies, how will they stand up for dollars? If they won’t up for vital essentials, what will they stand up for, and what is left that could matter more, anyways? Worst of all, perhaps, in all this, they have been broken, and now we know, and the Republicans know, that they will not be able to function now as an institutional force: the shattering of capitulation.

People are furious, absolutely scorchingly so, and this is all why they are correct to be, even more so than they know: that is why I’ve walked you through the numbers. Let me now summarize. The Democrats capitulated to authoritarianism and fascism. In the most pathetic and cowardly way—they couldn’t stand up for less than half a percent of the economy invested in the things people need most, food and medicine. And worse, they proved to society and to the fascists and authoritarians that they are a spent force who cannot even stand for this much, which are the most basic things of all, fracturing as a party, shattering, no longer a force now to be accounted for at all, just a laughingstock to the fascists.

Could anyone, after all, have asked any less of them? Would, say, it have provoked their courage if we’d said, why, my God, half a percent of the economy is far too much to ask, let’s draw the line at 0.01%? Perhaps you see my point—that’s not sarcasm. It is to underscore just how profound this capitulation really was.

So. This capitulation says: America is now a country with no functioning political opposition to fascism and authoritarianism. (And no, the mayor of a city emphatically isn’t what’s at issue here.)

It would’ve been another thing entirely to break nobly and courageously over something unreasonable, at least to fascism and authoritarianism. That might’ve been courage. This is breathtaking self-made powerlessness of the most pathetic kind, really. This, my friends, is obscene. It is grotesque.

Now. I don’t say that in the form of my own moral judgment. Rather, I say it as a warning.

You see, the world is looking at America right now in a certain way. It is looking to see how bad things will get. It is watching, intently, the pattern of capitulation. And it is trying to read into all that the answer to a vital question: is my capital safe?

Let me put that another way. Here is a country melting down into dictatorship. But I have capital invested in it, in the form of bonds, stocks, its currency, property, and more. Are any of these remaining institutions going to protect that? Or is capitulation reaching terminal velocity?

When the answer to that question becomes obvious, the world will begin to withdraw from America, faster and harder than it already has. And that will be catastrophic for the American economy, because it depends critically on investment from the rest of the world to support it’s ultra-high levels of consumption.

So: in other words, the world is looking for some semblance of a limit to America’s political instability. It isn’t looking for political stability, anymore—that much, we all know, is gone. But it is looking to see if the dust is settling—or if the implosions just go on, day by day.

And its wisest minds, who manage its capital, and its relationships, and its resources, are tracking the pattern of American capitulation. Not as closely as they should be, and even now, they are reluctant to act too fast, because they have sympathies with the America that used to be, and because they don’t wish to pull the trigger too fast. But sooner or later, their hand will be forced.

If America is a country which is so politically unstable that it has no effective functioning opposition to fascism and authoritarianism—and that, again, is what this capitulation says—then what is the world to conclude? That it’s capital, investments, and assets are safe? When there is now little to protect them but maybe…whether or not Trump decides not to lash out at them today?

Now. Capitulation by capitulation is how societies die. Not just because their institutions stop functioning this way, broken, ground into dust by authoritarians. But because the world can see it, too. When the Democrats capitulate in this way, and even Americans are furious, the spectacle isn’t just there for them to see. And when the world can see such implosion happening, of course, it withdraws from said societies, in order to protect itself.

That hardens cycles of collapse, as investment dries up, as capital returns to safer shores, as currencies are sold off, and ultimately, economies fall into a vicious cycle, where capitulation produces stagnation and depression.

Let me put that to you even more sharply. We all know that hunger and deprivation are not good for economic growth, apart from Republicans and Donald Trump. Shall we ask the Great Depression?

Now we are asking the world to ignore that, that such a society has become a profoundly risky place, and then to ignore the fact that all this is obscene, grotesque, and pathetic, and then to ignore the basic principle that says that the most basic element to be desired in a society, if you want to invest in it, partner with it, join with it in any way, is that it is governed in some semblance of an efficient, thoughtful, and considered way, like being able to pony up the courage and wisdom to even invest half a percent of its own money in the things it needs most, for Pete’s sake.

So we are now asking the world to ignore a) history b) economics c) finance d) morality and e) reality.

How do you think that’s going to work out?

The consequences for America of capitulation are real. Societies die capitulation by capitulation. Not just because that is how fascists and authoritarians break them. But because, more deeply, that is how they become such poisonous, empty, arid places that no one else dares plant a seed in such cracked soil, too. And then there is nothing left but predatory things slithering through the dust.

Think, my friends, think. I am just here to teach you. Capitulations like these echo throughout history, and they shake the world. Let them shake you out of what may be complacency, too. None of this will end well. You must plan for it, and stop avoiding that brutal, bitter truth for an instant more.

Love,

Umair (and Snowy!)

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