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SOVEREIGN MAN

How’s this for social unrest?

October 18, 2011
Phnom Penh, Cambodia

In his seminal work The Rise and Fall of the Third Reich, William Shirer recounts how the struggling Weimar Republic printed its way out of reparation debt from World War I. Out-of-control printing caused the German mark to fall from 75 per dollar in 1921, to more than 4 billion just 3-years later.

Talk about chaos. After a brief period of credit-fueled economic respite, the onset of the global depression in 1929 had people in the streets clamoring for change. Hitler’s National Socialism promised the world… and under such economic distress, people believed him.

There are two important lessons here. First is that hyperinflation comes very quickly. Confidence languishes for months, even years… until one day the currency begins to slide, slowly at first, then exponentially.

The second is what followed. Economic disaster begets social unrest, the two are inextricably linked. Populist rebellions and roving gangs became a constant presence in the republic.

It’s at this point, when people are really hurting, they’re the most impressionable. They’re looking for somebody, anybody, to lead them out of the turmoil. What they got was a charismatic leader with a grand plan.

Here in Cambodia, a similar story unfolded in the 1970s.

Years of constant American B-52 bombing campaigns during the Vietnam War took its toll on the country. Over 500,000 tons of bombs were dropped on Cambodia during the war.  By the time the last US forces withdrew from Vietnam in 1975, nearly three-quarters of Cambodia’s agrarian economy was destroyed.

Malnourishment and starvation were rampant, and Cambodians were ready to follow anyone with a plan.

Pol Pot’s agrarian socialism struck a chord. After years of civil war, Cambodia’s economic ruin opened the door for his communist forces to take over the country.

Just like Germany in 1930, economic hardship swayed just enough people to allow a criminal madman’s rise to power. Neither case required a popular majority, but merely a critical mass of vocal activists. The rest of the country either fell in line or was exterminated.

Under both regimes, people never got what they expected. Pol Pot waged mass genocide on his own people, murdering as much as a third of Cambodia’s population. Teachers, doctors, students, artists… anyone who could possibly pose a threat was neutralized.

I’ve had the opportunity to learn first hand about many of these cases during my times here. And not far from Phnom Penh, the infamous killing fields are still littered with human remains.

History is full of examples of governments taking draconian action in times of economic-fueled social turmoil. Faced with terrible circumstances, people cry out for their governments to ‘do something’. Politicians happily oblige.

It’s concerning right now to see the early stages of economic decline spawning populist uprisings; most are being met with unconscionable force by the police state.

Mark Twain used to say that while history may not repeat itself, it certainly rhymes. I’d encourage you to think clearly about what’s really happening in the world, and not simply write off such events as temporary aberrations.

Let me be even more clear: it’s not crazy to have a plan. You’re not a lunatic for considering your international options. In a world fraught with so much uncertainty, it’s the only sane choice.

About the author: Simon Black is an international investor, entrepreneur, permanent traveler, free man, and founder of Sovereign Man. His free daily e-letter and crash course is about using the experiences from his life and travels to help you achieve more freedom.

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Comments on this entry are closed.

  • Elle

    Simon, I am a female senior in high school and am trying to figure out what to do next year and for the rest of my life. Since the future of America is unstable, what would you do if you were in my shoes?

    • sodit

      Get qualified in a healthcare discipline. Such people are needed around the world. You will be able to make a living in the US, or if you wish to move elsewhere, they are likely to let you in.

      • Rpopovich

        Elle: Sodit is giving very good advice. Healthcare is one of the best bets as far as job availability is concerned, but you have to chose the area of medicine carefully. If you are interested in this kind of career, talk to several medical professionals in different areas of expertise. Several good alternatives to being an M.D., are R.N.’s, nurse practitioners, and physician assistant. In the last two choices you can chose a specialty, and make a really good living. R.N.’s earn anywhere from $20 to $36/hr, depending on the need for nurses in specific locations. Starting off with a B.S, or even a AAS degree as a registered nurse will put you in a good position to advance to one of the other two higher paying, and more complex careers.

      • ChuckPitBoss

        Have you thought about the military? You may be able to get an ROTC scholarship and go to college (assuming you want to go to college) that way. Of course, you have to pay it back but you do so by being in the service for 5 to 8 years. Then there is always one of the service academies but they are difficult to get in. As mentkioned above health care is always needed but the millitary has its place, even if it’s only here in the USA.

      • Kurthensch

        Who are “They”?? They won’t have any money either. Healthcare would be a good career

  • VoxFox

    Don’t forget that after inflating away their WW-I war debt the Germans just issued a new currency (backed by real national assets) that helped put Germany back on its feet.
    We can do the same, renounce the mountain of US bonds denominated in ‘old’ dollars then start again with new dollars.

    • sodit

      They only succeeded in putting the country back on its feet with the help of huge loans from the US. Then in 1929, following the fall on the New York Stock Exchange, the US needed the money back to satisfy its own requirement for liquidity, so they called in the loans causing a collapse in Germany.

  • Stephen

    I remember a few years ago, watching the news of a devastating tornado hitting a Texas community, and the camera focused on a woman crying out in despair, “Why don’t they DO something?”  And I wondered ‘Who?’.  That is the common mindset now, and it is dangerous. 

    • Alcam

      You are correct.  The sense of dependency is growing in most communities.  The source is the “powerful” who can control you more easily if they have made believe that you are dependent on them.    It is the “bankster” who is dependent on the person who does the physical work to produce wealth, but the “powerful” tell us that we are dependent on the “banksters” for a job. 

  • Junglejburke

    It seems the way Obama writes EO’s and what is happening on the streets with the proletariat, we may never see another Presidential Election.  As in the USSR under Lenin the, Duma (law making body)Lenin remarked was only a talk shop where nothing was ever decided. We watch our Congress has pretty much joined the “Talk Shop” society.  The agenda is decided before Congress ever goes into session.  Oh!, they make it look important but the outcome will always fit the leftist agenda. Don’t know about anyone else – but – I am tired of compromise.  That’s how we got a crashing economy and lost our jobs to everywhere but here. 

    • ChuckPitBoss

      Like the rest of the teapuklicans, who don’t like the existing government, you have no plans or ideas on what you want the government or this country to be or do. Eliminate graft, corruption and duplication of efforts by various government departments? That thought is admirable but very difficuolt to accomplish. Why? The government  beuracracies and millionaire people in charge (call them congresspeople) won’t allow it. And the hated lobbyists won’t like it and will do everything to prsuade otherwise.  They are all too comfortable with the staus quo. The “good old boy” network is in full swing and has been for decades. “I can save the world but I must first save my seat” are the bywords here and they exist in the statehouses and local governments as well. Our government is broken and I feel it’s not repairable. Is it time to start completely over? 

  • Anonperson

    Your history of Cambodia is so wrong it calls into question everything you write. Cambodia was lost due to the Khmer Rouge being supported by King Sihanouk, which the rural, superstitious Cambodians supported out of fear that if they did not, the rice wouldn’t grow. The US mainly bombed forest areas near the Vietnam border where no crops were grown. Have you been reading too much Chomsky? Fool.

  • Paul

    I’ve just been notified in my pension check stub that due to federal banking regulations, pension checks can no longer be electronically sent (EFT) to foreign banks.  This will affect those retired overseas, or who are contemplating it.  It means that your pension check has to go through the vulnerable US banking system before it can be sent to your local bank account overseas.

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