Tough Lessons Are Yet To Be Learned

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The Fall of the American Empire Has Begun

September 22, 2013
Editor's note: Nothing about the Syrian civil war or Washington's threats to bomb the country comes as a surprise to Richard Maybury's readers…

For years, Maybury – editor of the Early Warning Report and author of the Uncle Ericbook series – has described how America's perpetual involvement in the area he calls "Chaostan" is a clear symptom of the failing U.S. empire.

Richard is widely viewed as one of the world's foremost free-market thinkers and historians. Porter has said Richard's Uncle Eric book series is "one of the best educations on history, liberty, personal responsibility, and the idea of America that you can find anywhere, for any price."

Richard described the history and politics of Chaostan and the U.S. Empire in a 2011 interview with S&A's financial news and opinion aggregator, The Daily Crux. (We also featured this discussion in an April 2011 edition of the S&A Digest.)

Virtually every word he said about what was happening in Egypt and the Middle East then applies to the current events in Syria today. So we felt it was important to republish this piece again today…

The Fall of the American Empire Has Begun
An interview with Richard Maybury

The Daily Crux: Richard, you've long said the collapse of the American Empire would be the central issue for Americans, with regard to money, investing, and life in general.

In your recent issue of Early Warning Report, you said there's now a very high probability this collapse has already started. Can you talk about why you think that is?

Richard Maybury: Let's start with a little history: All empires eventually fall. No one in Washington will admit it, but the U.S. has been an empire for decades now, and there has never been any reason to believe our empire would be immortal.

People who are power-seekers want more power, and they'll sacrifice other things in order to get that power. One of the things power-seekers in a large government almost always sacrifice is the financial integrity of the country. They will bleed the whole economy dry just to increase their power. That's a main reason empires fall.

We see it all through history. You can look back to any of the ancient empires… They're forever wrecking their economies in order to increase their political power. So it's no brilliant prediction to say the U.S. Empire is going to fall. Anyone who has studied much history should have been able to predict this mess was going to arise… and here it is.

It's fascinating to me. I talk to all sorts of so-called ordinary people, such as dentists, barbers, and taxi drivers. Most have no understanding of what's actually happening to America, but they all know deep in their hearts something has gone terribly wrong… and it's not going to end anytime soon. This is an interesting condition that has arisen recently.

Americans, up until the last year or two, have always been optimistic. They would say things like, "Yes, hard times come along, but this, too, shall pass." They aren't saying this anymore. They're beginning to figure out that America's troubles aren't going away this time.

You can see these problems in the financial markets and elsewhere… unemployment, bankruptcies, mortgage defaults, poverty… These are all just symptoms of the fall of the empire. Let me quickly point out, however, that the fall of the empire is actually a wonderful thing. Empires are cancers, and it's a good thing to excise them as fast as possible. But the surgery necessary to do it is awfully painful.

If you look at any previous empires I write about – the French Empire, the British Empire, the Russian Empire – these countries are all much better places today than they were when they had empires. America will be too. But we've got to get from here to there… and the process is very, very painful. We're going to experience an awful lot of trouble because of it.

Crux: For many years, you've also been writing about the problems in the Middle East. In the past few months, it seems many of those problems are coming to a head. Can you explain how the troubles there – part of the area you refer to as "Chaostan" – are related to the troubles we're facing here at home?

Maybury: Sure. For those who aren't familiar, "Chaostan" is a term I coined for the area from the Arctic Ocean to the Indian Ocean, and Poland to the Pacific, along with North Africa. This area includes the Middle East.

In Central Asia, the suffix "stan" means "the land of." For example, Afghanistan is the land of the Afghans. So in 1992, I coined the term Chaostan to mean "the land of great chaos."

The reason this area is so often in chaos is a conversation of its own, but here's a quick summary.

All religions teach that there is a higher law than any government's law, and they all teach two fundamental laws: Do all you have agreed to do, which is the basis of contract law, and do not encroach on other persons or their property, which is the basis of tort law and some criminal law. Each religion expresses these laws in different ways, but they all teach them.

These principles are the basis of the old British common law. It was called common law because it grew out of principles common to all.

In a book called The Ideological Origins of the American Revolution, historian Bernard Bailyn pointed out that the American Revolution, the Constitution, Bill of Rights and Declaration of Independence all sprang from the common law.

In the decades following the revolution, other people saw America's new liberty and prosperity. They wanted the same thing, and the American philosophy began to spread around the world. The areas where it took root became known as the "Free World."

Then in the mid-1800s, socialism began to spread, and it nearly killed off the American philosophy – a philosophy that I believe is now being rediscovered.

Chaostan is the most important area where the principles of liberty never got a chance to take root. From the beginning of history, most parts of Chaostan have been a sea of blood and destruction because they never had rational legal systems… and still don't.

The turmoil is greatly aggravated by the interference of European regimes during past centuries.

When you look at this area on a map of the world, you see all these countries are delineated by borders drawn by Europeans. Very few Americans understand this. Practically every border in the world was drawn by the European governments as they swept over the globe conquering one country after another.

European rulers would draw the borders in locations that were convenient to them. And so there are very few borders in the world that were drawn by the people who are native to those areas.

This means what we regard as a country when we look at a map usually isn't really a country at all. It's a collection of tribes cobbled together by the Europeans for the convenience of the Europeans.

In each of these so-called "countries," there are some tribes that are either dominant or want to be dominant. And the way they achieve dominance is by acquiring money, weapons, and other resources from outside powers, which were originally the Europeans.

A good example is Saudi Arabia. The Saudi tribe was one of many that lived on the Arabian Peninsula. The British government essentially created Saudi Arabia by giving money and weapons to the Saudi tribe and helping them take control of the other tribes.

This would be akin to China or some other foreign country coming to the United States and choosing single families or neighborhoods to rule over entire states. These families would have all the wealth, all the power, and would make all the rules. And just in case anyone got any ideas, the Chinese government would keep a few battleships and aircraft carriers parked near our shores.

Crux: We're huge fans of your Uncle Eric books here at The Crux, and I remember being blown away the first time I read that example. We're not taught these things in our schools… But when you look at it from that perspective, it's not surprising there's so much anger toward Western governments.

Maybury: Exactly… and this is the case all over Chaostan. None of those nations are what you and I would regard as natural countries. They were artificially created, and the rulers of those countries were propped up, in nearly every case, by the Europeans.

Keep in mind that except for five countries — Iran, Thailand, Afghanistan, most of China, and Japan — every country in the world at one time or another was conquered by the Europeans. So the political structures we see in these countries — nearly all countries — are either creations of the Europeans or outgrowths of those creations.

During and after World War II, some of these tribal leaders wanted help maintaining their power after the Europeans departed. The U.S. was the top dog at that time, so they said to Washington, "We will do your bidding – we will be your surrogate here – if you do what's necessary to keep us in power."

That's the deal that was made with dozens of regimes around the world. That's the U.S. Empire, and that's what is falling apart now. The people who have been dominated by tribes backed by Washington are sick of it, and they're starting to overturn the existing political matrix.

So the troubles in the Middle East are to a large extent part of the collapse of the empire. For instance, Hosni Mubarak in Egypt was one of Washington's closest surrogates… and he was a nasty guy. He's out of power now, and Egypt is in great turmoil. Nobody knows who's going to take over the place.

That's just one example out of many. The whole thing is beginning to crumble. Egypt was one of the early cases, and I think there are going to be a lot more.

Even nations that were not part of the U.S. Empire are being thrown into chaos, as the spirit of rebellion spreads.

As of a couple weeks ago, I think there are now 11 countries over there experiencing uprisings of one kind or another. I expect this is going to continue to spread.

It's very possible Egypt will wind up being the model for what happens in many of those countries… where you have a U.S.-backed dictator who is overthrown and then so-called Islamic fundamentalists come in and take over. That's very likely what's going to happen in Egypt.

Obviously, I don't know for sure… no one should be certain about these things. But I'm inclined to believe the Egyptian government is going to be replaced by something that will not be friendly to Washington.

Again, however, we're really on thin ice when it comes to making predictions about these sorts of things. Egypt contains many millions of people, each with his own agenda. Predicting how all that's going to go is very, very problematic.

What I can say with confidence is the political matrix Washington put in place during and after World War II is now crumbling. I think that's pretty clear. And again, I return to the point: This is ultimately a good thing. The U.S. Empire should never have existed in the first place.

Crux: Why did the U.S. get involved in Chaostan to begin with?

Maybury: I believe it really just goes back to the lust for power. That's one thing the mainstream news media is absolutely derelict about… They say practically nothing about political power.

Crux: Could you define political power for us?

Maybury: Perhaps the simplest definition is "the legalized privilege of using brute force on persons who have not harmed anyone." This privilege is what sets governments apart from all other institutions. No church, charity, fraternal organization, or any other institution can legally send people with guns to your home to force you to buy their services or obey their rules. Only the government can do that. And whether they realize it or not, it's this privilege – of using force on persons who don't deserve it – that a power-seeker wants.

Crux: Is that related to the old saying that power corrupts?

Maybury: Very astute of you to make that connection. If the American founders were here today, they'd tell us political power is poison… Stay as far from it as you can… It's evil stuff.

But the media have bought into this assumption that political power is good, it's the solution to our problems, and a world full of political power is a good place. They almost never look into the psychology of it… What causes a human being to want to force his will on other people? Because that's what political power essentially is – the ability to bend other people to your will. And the media just don't look at that at all.

There's this assumption that the people in the federal government are a whole lot of nice individuals who have good intentions, and it would never occur to any of them to get a thrill out of forcing their plans onto somebody else.

But that's what it's all about, and that's what it's been about for thousands of years. Government is brute force. Coercion. Chains. Prisons. Follow our plans or else. The political mind is the mind of a bully.

Crux: We often hear the U.S. is involved in the Middle East because of oil… How big a role does oil actually play?

Maybury: I think oil is an excuse. I don't think it's a reason for the empire. Whoever owns the oil has to sell it or it's worthless.

They may not want to sell it directly to us, but they're going to sell it to somebody. This will increase the total world supply of oil, and the price of oil from other suppliers will go down.

So the idea that this is all about oil… that's just a smokescreen. It's about power. It's about the thrill that these people in Washington get out of meddling in other countries.

Crux: You mentioned before that it's very difficult to make predictions. But what do you see happening next in the region?

Maybury: As far as that's concerned, I refer to Egypt again. The friends of Washington are widely hated by their own people, and they will be coming under pressure to hit the road.

Look what happened to the Shah of Iran back in the late '70s. I think it's going to happen to pretty much all of Washington's surrogates. Like I said, it's a fool's game to try to predict these things, but that's the direction events are going now, and that's the direction I've been predicting since the early 1990s.

Before the Soviet Empire fell apart, the Soviet Union sat on Chaostan like a lid on a pressure cooker. One of the forces at work there was the individual tribes that ruled these countries did not want to be conquered by the Soviets, so they formed alliances with Washington as a protection against the Soviets. When the Soviet Union fell in the early '90s, this essentially removed the lid on the pressure cooker. The explosion began, and now it's escalating.

In the 1990s, the rest of the world was cheering a new era of peace and brotherly love… and I was saying, "That's ridiculous. The whole place is going to blow up." Everybody said I was crazy, and I kind of wondered if maybe I was.

But it turned out that by the year 2000 – a mere 10-year stretch of the new era of peace and brotherly love – more than 100 wars broke out and more than 5 million people were killed.

I think what's happening today is just the beginning of what will turn out to be even more violent than the '90s. There are literally hundreds of millions of really angry people over there, and a rebellious momentum is growing.

Again, I'm really reluctant to make specific forecasts on this kind of thing. All you can say is governments have been creating empires since the beginning of history, and empires have been falling apart since the beginning of history… We're in one of those "falling apart" periods now.

Crux: Do you think the individuals in power in Washington realize the empire is crumbling? Do they even realize it's an empire?

Maybury: Well, it's official U.S. policy that Washington does not have an empire. Everybody is taught that.

But just a couple months ago, President Obama phoned up Mubarak in Egypt and fired him. If that's not an empire, what is it?

Now, Obama has decided the Libyan government should change, too. These people in Washington seem to think they're ordained by God to somehow make the world better.

I think it's amazing they believe they're intelligent enough to be able to do that. It's actually pretty hilarious.

Crux: So as the empire begins to crumble, how do you think Washington will respond?

Maybury: I think we'll see more examples of Washington trying to steer events in directions favorable to Washington. Notice I'm not saying favorable to America. I'm saying favorable to the U.S. government. They are two entirely different things.

Of course, the people in Washington are all individuals. They all have their own agendas. They can't even agree on what's favorable to the government.

So they're all grasping at straws. They have no idea what they should really do in a situation like this. There are no guidelines. And since they don't even want to acknowledge they have an empire, they don't understand what it is they're trying to save.

I mean, talk about a bunch of lost souls. They seem to think being elected means they have some sort of special ethical position in the world. They have no idea what it is they're trying to defend. All they know is they're trying to defend it.

Typically, in every empire, it all continues until one day somebody looks at the books and says, "Gee, we're broke. We can't do this anymore." That's when it all starts to come apart.

One of my favorite stories is about William Gladstone – the prime minister of England in the mid-1800s – and that's essentially what he did. He just said, "Look, we're going broke trying to prop up this empire. This is ridiculous."

He started dismantling the British government's power. He probably made more progress in abolishing political power than any other lone individual in history. It's an amazing story.

Gladstone is one of the few peaceful examples of how all empires go down. They eventually realize they can't play the game anymore. They realize they've exhausted their resources… They've bled the population dry.

Humans can only produce so much wealth, and the government is consuming this wealth in order to prop up the empire. Eventually, it all just goes under.

Incidentally, we're talking here today about the federal government's empire abroad… But America itself, internally, is part of the federal empire, too. There are no less than a quarter-million federal bureaucrats making and enforcing regulations on us. And each of these regulations is backed by guns, chains, and prisons. It's not much of an exaggeration to say the whole world – including America itself – has been conquered by the federal government.

Crux: How close do you think we are to the point where the empire collapses the economy?

Maybury: My best guess is we're in the process of going under now. That's the economic trouble the average American is noticing… the unemployment, the business failures, the financial crash, the real estate collapse… plus the mental and emotional strain – the psychological depression, marital problems, divorces. It's the process of the empire going under. The economic problems are symptoms of the manipulation of the currency, and all sorts of other economic tomfoolery, to try to keep the federal bureaucracy well fed at the expense of the rest of us.

The absolute best thing Washington could do for the American people – if the folks in Washington were honest – is just announce that the empire is over. "It's finished, we quit." We're going to withdraw our troops from all those countries around the world. We're going to bring them home to defend America. We're not going to meddle in other countries anymore.

After all, this attempt to keep the Empire alive is just squandering blood and treasure for nothing. We're bankrupt. We can't do this anymore. The attempt to preserve the empire – which means, largely, the attempt to keep Washington's surrogates in power – is just dragging out the whole painful process and making it all the more expensive and hopeless.

If they'd just give it up, that would be the first big step in triggering the economic recovery. But they're not going to do it. They're power junkies. They'll drag this thing out until – in the words of political philosopher Howard Kershner – the last bone of the last taxpayer has been picked bare.

Crux: So what are the personal and investment implications of the fall of the American Empire? How do you recommend people prepare for what you see coming?

Maybury: First and foremost, you should have a good stash of emergency equipment and supplies. Everybody should have these things anyway, because you never know what's going to happen, be it earthquakes, riots, hurricanes, riots, epidemics, riots, blizzards – did I mention riots?

Life is full of really nasty surprises. Everyone should have the ability to be completely self-sustaining for at least a month. Three months would be better. You want food, water, all the necessities of life, plus the ability to defend yourself and your loved ones.

As far as investing, my approach in Early Warning Report is to try to identify long-term trends that are very solid, and invest in things that will benefit from these long-term trends.

If you look at history, you'll find there are two carved-in-granite long-term trends that never seem to change. The first is war. The second is currency debasement. So what I do is suggest investments that will benefit from these two major trends.

The obvious winners from war are the defense giants: Northrop Grumman, Lockheed, General Dynamics, and Raytheon. If you want to just buy a collection of defense stocks, the Fidelity Select Defense & Aerospace Fund contains those four and a lot more. Its symbol is FSDAX.

The major beneficiaries from currency debasement are raw materials, because they cannot be created in unlimited quantities on a printing press… especially precious metals. So I recommend everyone own some gold, silver, and platinum bullion coins. These have been doing wonderfully, and I think they'll continue to do so because the fiat paper currencies are dying. Beyond those, you can also consider some of the top commodity and energy producer stocks. To find a list, just look at "Track Record" on the home page of our website.

For an investor who's just starting out in this area, FSDAX and the coins are good ways to go. Get into those first, and as you learn more, you'll find other ideas you'll want to follow. You can find many more in my letter as well.

Crux: You mentioned earlier that the fall of the empire – while painful – will ultimately be a great thing for our country. Can you talk about what you see for the future of America?

Maybury: Many people misinterpret me as a "doom-and-gloomer." But let me tell you, for the long term, I'm unimaginably optimistic. I am more optimistic now than I have ever been in my entire life, and I'm 64 years old.

I fully expect to live a healthy life until at least 140 because I believe technological breakthroughs are coming so fast now that Ray Kurzweil is right – a healthy 140-year lifespan is plausible. And before I die I expect to see the beginning of the civilization that is depicted in the Star Trek stories. Not the whole Star Trek civilization, but the beginning.

I believe the next great civilization will begin almost instantly, as soon as we get the present statist nightmare out of the way. But getting from here to there is going to be really hard. For the short term and medium term, it's going to be really awful, I'm afraid for quite a few years.

I hope things in America and Western Europe don't get as bad as Russia was in the 1990s – when the Soviet empire was falling – but it's definitely a possibility in some places, especially the major cities. I encourage everybody to be ready to ride through some very hard times, because empires almost never fall quietly.

Once the U.S. Empire does go down, though, I expect we'll see a new prosperity. I'm very optimistic about this, because the world is now learning what statism is really all about… what political power really does. It's not theory anymore… We're experiencing it every day.

The true nature of statism is an extremely painful lesson to learn, but once it's learned, the decks will be clear to produce a truly healthy, advanced civilization. When that happens, hold on to your hat… Things are going to be wonderful, and it will happen fast.

Crux: Could you define statism for us?

Maybury: Statism is the belief that political power does not corrupt, and government is a good thing, the solution to all our problems. This is what is taught in the government-controlled schools. If Jefferson and the other American founders were here, they'd fall down laughing at such a notion. But what else would a government-controlled school teach?

Crux: Why wasn't that lesson learned after the fall of the Soviet Union?

Maybury: Well, the economic side of it was learned to a large extent. The world saw what central planning did to the Soviet economy… So even communist China has embraced free-market economic principles, to some extent.

But you still have seen practically no focus on the dangers of political power itself… on the fact that political power is evil and treacherous – it corrupts.

That lesson has yet to be learned… or re-learned. The early Americans understood it well. But most people today have this attitude that the reason things are bad is the wrong people are in power, and if we somehow put the right people in power, everything would be okay.

There's little appreciation for the fact that political power itself is the problem. It corrupts morals and the judgment. And no matter who you put in there, he or she will likely end up making a mess.

So that lesson has yet to be learned. Once you see discussions about political power itself – about what it is and what it does to a person's mind – appearing in the news media, we're going to be well on our way to where we want to be – a new world of liberty, peace, and abundance.

Crux: That sounds great. Thanks so much for talking with us, Richard.

Maybury: It was great speaking with you. Thanks for having me. Take care.

Editor's note: We believe Richard's Uncle Eric books are among the best ever written on history, finance, and economics. If we had our way, every child in America would read and understand the critical ideas found in the Uncle Eric books. Richard's monthly newsletter, the Early Warning Report, is also a must-read around our offices. You can access Richard's work by clicking here.

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