Results of a recent poll revealed the rather stunning fact that a growing number of Americans find socialism (collectivism) appealing. Fifty-seven percent of Democrats say they have a “positive view” of the ideology. There has been widespread support of the Green New Deal proposed by the newly elected self-proclaimed “democratic socialist,” U.S. Representative Alexandria Ocasio-Cortez of New York. There also has been increased interest in Modern Monetary Theory (MMT). Given those facts, it’s clear that the new and curious love affair some Americans seem to be having with socialist ideals is more than a passing fling.
If interest in socialism continues to flourish, effective ways to grow and protect personal wealth could be greatly limited. The only option for ensuring survivability of one’s portfolio may be to own genuine safe-haven assets such as gold and silver.
The Green New Deal: Giant Step Toward a New America?
The Green New Deal is accused by many of being a collectivist takeover of the United States masked as an environmentally-centered stimulus program. Most of the planks of the Green New Deal do connect back to climate change and the environment in some form or fashion, but they also have a strong aura of totalitarianism about them. They include such proclamations as:
“…meeting 100 percent of the power demand in the United States through clean, renewable, and zero-emission energy sources.”
“…upgrading all existing buildings in the United States and building new buildings to achieve maximal energy efficiency, water efficiency, safety, affordability, comfort, and durability, including through electrification.”
The cost to successfully pursue the purely environmental agendas outlined in the Green New Deal would be astronomical, but that’s only the beginning. There are other planks of the proposal that have essentially nothing to do with the climate and everything to do with a socialist political outlook, such as:
“…guaranteeing a job with a family-sustaining wage, adequate family and medical leave, paid vacations, and retirement security to all people of the United States.”
“…providing all people of the United States with — (i) high-quality health care; (ii) affordable, safe, and adequate housing; (iii) economic security; and (iv) access to clean water, clean air, healthy and affordable food, and nature.”
The American Action Forum, a think tank headed by Douglas Holtz-Eakin, former Director of the Congressional Budget Office, says the Green New Deal could cost as much as $93 trillion. That’s equal to roughly 40% of the all the world’s debt presently and more than four times the size of the current U.S. national debt.
Socialist Economics in the Form of Modern Monetary Theory
Putting aside the sociopolitical implications of the proposal, there doesn’t appear to be a way to pay for a program such as this in any manner even remotely resembling financial soundness. Enter another economic darling of American neo-socialists (including Rep. Ocasio-Cortez) to help support this radical economic idea: Modern Monetary Theory (MMT).
MMT is a fiat-currency-on-steroids economic theory that effectively says public debt and deficits don’t really matter when the government can issue its own currency, and so it is free to spend as much as it wants on whatever it wants. As for insolvency, MMT says governments that print their own currency cannot go broke unless they make a political decision to do so.
Aside from the singular but very destructive potential risks of MMT, such as hyperinflation, the real problem is that it can go a long way to solidifying the transition to a centrally planned economy, where all the economic decisions are made by the government. Examples of such economies include Cuba, China, the former Soviet Union and now Venezuela.
Under a “normal” fiat currency/central bank regime, the purchasing power of the dollar has declined more than 96%. What will happen if MMT becomes a reality?
I’ll probably address MMT at greater length in the future, but for now I wanted to mention it in the context of the Green New Deal and, more generally, against the backdrop of the apparent zeal with which so many Americans seem bent on redirecting the U.S. toward a more collectivist society.
Precious Metals Can Be a Refuge from Government-Centric Economics
So how will you protect yourself from the economic fallout that could arise from this possible new direction and give yourself real peace of mind in the process? One simple but valuable step you can take is to include physical gold and silver among your assets.
A major shift in the nation’s sociopolitical outlook toward socialism potentially could wreak havoc on the nation’s currency. But even without that change, there are plenty of threats to your portfolio lurking right now – record-level global debt, economic weakness and continued trade conflict are just a few of them. To learn more about how physical gold and silver can help keep your retirement account secure, call Augusta Precious Metals at 855-242-4121 and speak with one of our dedicated gold and silver professionals. Ask, too, about how you can buy your gold and silver inside of an IRA, which allows you to combine the unique benefits of owning physical precious metals with the power of tax-advantaged growth.