Authored by Michael Maharrey via SchiffGold.com,

Global debt rose $10 trillion to a record $397 trillion in the first half of 2023, according to the Institute of International Finance (IIF).

The big increase in debt occurred despite tightening credit conditions, and it is an increasingly worrisome problem because the “free lunch” of artificially low interest rates is over.

Over the last decade, global debt has increased by a staggering $100 trillion.

Combined government, household and corporate debt hit 336% of global GDP in the second quarter of this year. The global debt-to-GDP ratio has increased by 2 percentage points this year. Prior to 2023, the global debt-to-GDP ratio had declined seven straight quarters after reaching a record of 360% at the height of the global pandemic government lockdowns.

About 80% of the new global debt was piled up by developed nations, with Japan, the US, Britain and France leading the way. Among emerging markets, the largest economies saw the biggest debt increases, including China, Brazil and India.

“As higher rates and higher debt levels push government interest expenses higher, domestic debt strains are set to increase,” the IIF said in a statement.

Peter Praet served as chief economist at the European Central Bank. He told Reuters that the debt levels are still sustainable, but the outlook is worrying given the fact that spending needs aren’t going to decline.

You can take many, many countries today, and you will see that we are not far away from a public finances crisis.”

Praet seems over-optimistic.

The US government is over $33 trillion in debt. In fact, the Biden administration managed to add half a trillion dollars to the debt in just 20 days. Meanwhile, with rising interest rates, the federal government is now spending as much to make interest payments on the debt as it is for national defense.

And there is no end to the borrowing and spending in sight.

More than a decade of interest rates pushed artificially low by central banks worldwide incentivized a tidal wave of borrowing. This was intentional. The thinking was that borrowing and spending would “stimulate” a global economy dragged down first by the Great Recession and then by government-instituted pandemic policies. Nobody ever stopped to think the easy-money gravy train might run out of track.

But as Fitch Ratings managing director Edward Parker put it, “That free lunch is over and interest payments are now rising faster than debt or revenue.”

The US economy in particular was built on borrowing and spending. Easy money is its lifeblood. It simply can’t run without artificially low interest rates. The global economy is in much the same boat.

That puts the Federal Reserve and other central banks between a rock and a hard place. They need to keep interest rates high to counteract the trillions of dollars they created and injected into the global economy as stimulus causing a rapid increase in price inflation. But these higher rates will ultimately break things in the borrow-and-spend economy.

Authored by Jeffrey Tucker via The Brownstone Institute,

In the course of almost four years, and really dating back a decade and a half, I’ve managed to read most of the writings of the intellectuals, titans of industry, and government officials who constructed the strange reality of 2020 and after. They wanted to conduct a science experiment on the human population. Because infectious disease knows no borders, they knew for sure it would have to be a global one. 

They had every detail worked out in their models. They knew how far apart people would need to stand. They knew that the best way to stop any common virus from spreading would be total isolation of the whole human population insofar as that was possible. Families could not do that of course but they figured that they could live in different rooms or simply stay six feet apart. If they couldn’t do that, they could mask up. 

It goes without saying – but they said it anyway because their models told them so – that indoor and outdoor venues where people gathered had to be closed (those were the exact words issued by the White House on March 16, 2020). The scheme was deployed first in China, then Northern Italy, then the United States, and the rest of the world fell in line, all but a handful of nations including Sweden, which faced many months of brutal criticism for allowing freedom for its citizens. 

It’s truly hard to imagine what the architects of this barbaric policy believed would happen next. Is it as simple (and ridiculous) as believing that a respiratory virus would just disappear? Or that a potion would show up in time to inoculate the whole population even though no one has ever successfully come up with something like that before? Is that what they believed? 

Maybe.

Or maybe it was just fun or otherwise remuneratively advantageous to try out a grand and global experiment on the human population. Certainly it was profitable for many, even if it wrecked the social, cultural, economic, and political lives of billions of people. Even as I write those words, it’s hard to believe they are not out of some dystopian fiction. And yet this is what happened. 

Almost immediately, the idea of human rights took a back seat. Obviously so. So did the idea of equal freedom: that was immediately on the chopping block. By edict, the human population was divided into categories. It began with essential and nonessential, distinctions drawn from military protocols that suddenly pertained to the whole of the civilian world. 

That was only the beginning of the stark divisions. The stigmatization of the sick began immediately too. Were they sick because they were insufficiently compliant? Did they disobey the protocols? In a hundred years of public health, we’ve not seen this level and scale of demarcation. Some of this was attempted during the AIDS crisis (pushed by none other than Anthony Fauci) but not this aggressively or comprehensively. 

In those days, you could feel the concern for basic rights and freedom slipping, and with it the moral conscience of the public mind. From the beginning, it felt like martial law and the population was being divided: sick vs. well, compliant vs. noncompliant, essential vs non-essential, elective surgeries vs. emergencies needing medical services. And so on. 

And this expanded dramatically over the coming months. When face coverings came along, it was masked vs unmasked. When some states started opening, it became red vs. blue. Us vs. them. 

When the vaccine came along, the ultimate division hit, piling upon and swamping all the others: vaccinated vs. unvaccinated. The mandates massively disrupted the labor force. The public accommodations of whole cities were shut off to the unvaccinated, so that noncompliant citizens could not go to restaurants, bars, libraries, theaters, or other public places. Even houses of worship went along even though they didn’t have to, breaking their congregations into two parts. 

Behind all of this was a political motive that traces to a text that every high expert still celebrates as a prescient and decisive refutation of liberal values: Carl Schmitt’s Concept of the Political from 1932. This essay is utterly dismissive of human rights on grounds that such notions do not sustain robust states. He was of course a Nazi jurist and his thought laid the groundwork for the demonization of the Jews and the march of the totalitarian state. 

In Schmitt’s mind, the friend/enemy distinction is the best method of rallying the people around a grand cause that gives life meaning. This impulse is what gives strength to the state. He goes further: the friend/enemy distinction is best ignited in the reality of bloodshed:

“The state as the decisive political entity possesses an enormous power: the possibility of waging war and thereby publicly disposing of the lives of men. The jus belli contains such a disposition. It implies a double possibility: the right to demand from its own members the readiness to die and unhesitatingly to kill enemies.”

If for years, you have asked the question “Where does this end?” we now have our answer, which seems inevitable in retrospect: war. We are looking at the deaths of innocents and probably this as just the beginning. The lockdowns broke not only the old moral codes and agreed-upon limits to state power. It broke the human personality and spirit the whole world over. It gave rise to a bloodlust that was barely beneath the surface. 

States went crazy in bullying and dividing their citizens. It happened nearly everywhere but Israel was a leading case in point, as Brownstone has pointed out repeatedly. The citizenry has never been more divided and the state never more distracted from security concerns. The delicate peace was shattered in shocking ways on October 7, 2023 in a ghastly attack that revealed the worst security failure in the vulnerable state in its history. 

That incident then encouraged and further unleashed the apocalyptics, whole peoples determined to take the next step in the dehumanization of the population and the use of appalling means of doing the unthinkable: extermination, a word now thrown around as if it is fine and normal to speak this way. This conflict has now reached further into the politics of every country and down to every civic association, communities of intellectuals, and personal friendship. As Schmitt might have loved – and what Bret Weinstein calls Goliath (the unity of administrative state, media, corporate power, and elite tech platforms) surely celebrates – everyone is being turned into the category of friend and enemy. 

We are reminded at last of how incredibly fragile civilization – and the peace and freedom that gives rise to it – truly is. We should worry that in the drama of the moment, the history recounted above will be discarded from human memory. The plans for virus eradication failed so badly that many of its perpetrators are desperate for a dramatic change of subject so that they can avoid responsibility. Again, this is the desire, and it might even be the plan. 

This simply cannot be allowed to happen. Those of us with memories of civilized life, including universal rights and freedoms, cannot stay silent or get emotionally drawn in to the point that we are willing to forget what was done to us, the damage it inflicted on public culture, and the moral conduct a civilized people expect. 

Every war is preceded by a period of demoralization (I don’t matter), demotivation (there is nothing I can do), and dehumanization (those people are not worth saving). From there it is a simple matter of flipping the switch. 

Brownstone was founded in light of the above history to shine a light on higher ideals, not a Schmittian war between friends and enemies but societies of compassion, dignity, freedom, rights, and the exercise of human volition against all threats and uses of violence public and private. This is our guiding light now and always. Apocalypticism builds nothing; it only destroys. It’s the instantiation of the philosophy of The Joker. No nation and no community can survive it. 

Few of us knew or fully understood the depth of depravity just beneath the thin veneer of civilization that had previously dominated the large expanse of our lives. It was the maniacal experiment in disease control only a few years ago that triggered this bout of man’s inhumanity to man. There is a burning need to know how this came about and why, and take measures, now desperate ones, to put back into the Pandora’s box all that was released.