The Pendulum Cuts

 

Edgar Allan Poe’s short story, The Pit and the Pendulum, describes the anguish and terror of a prisoner of the Spanish Inquisition. An element of his torture is a pendulum swinging above his bound torso that descends slowly and is destined to eventually cut him in two.

Pendulums are often used to describe movement of a repetitive nature swinging to the extremes before returning to a more central position. As humans we are prone to crave movement and shun the status quo. In world events we seem never to be satisfied with things that are not moving in one direction or another.

We have gone from periods of isolation to global involvement and back again. We are now headed toward isolation under the banner of nationalism. In former periods of isolation, we sought to avoid conflict with the happenings in Europe and elsewhere as a matter of policy. In the 1930s the perils of WWI were fresh, and isolation was an easy sell. Today, other forces are at work.

In this 21st century edition, economic forces up to now, have worked to favor a global economy rather than an isolationist or nationalistic viewpoint. There was both good and bad in this as commodities got cheaper, some American jobs headed overseas. With open supply lines this movement was accommodated. On the downside, we lost jobs in manufacturing and this globalization saw us spending beyond our means.

This so-called trade imbalance was scapegoated as the culprit by nationalists and the problems were exacerbated by the Covid pandemic when supply chains were disrupted. It became evident that certain supply disruptions threatened national security and our ability to manufacture our weapons of war. America always has to have the biggest slingshot, and we are willing to outspend our nearest rivals several fold. We will do this even if this means adding to the national debt. Congress has been kicking that debt can down the road so many times it has become a national pastime.

Now we have an amateur economist whose expertise lies in real estate and entertainment, and who sees all things as transactional with winners and losers. He can never see the mutual benefit of free trade as that doesn’t fit his sense of dominating all such activities where he wins and everyone else loses. His myopic Mr. Magoo viewpoint sees a series of individual “deals” rather than the complex interrelationships of a global economy. Shifting to his nationalistic economy, if it were possible at all, would take decades to achieve. In the meantime, all but the very wealthy would suffer immeasurable hardships.

Even in this world of transactional winners and losers, he has lost as many times as he has won. His historical business past is littered with failures. His main claim to wealth came from being a showman on television. Now he has discovered the wealth that is available in politics where he can control and avoid lawsuits and taxes and get people to give him cash for his favored treatment.

In his economic la la land, he is crafting an environment where he can shift more of the tax burden toward the lower classes and make himself and others within his realm, more exempt from this perceived waste of personal capital. There is certainly one person guaranteed to be a winner when the economy takes on water and sinks. The captain of our economic ship can reap personal financial rewards in the present while ignoring that iceberg dead ahead. He already has his lifeboat ready and will sell the rest to the highest bidder.

In his effort to consolidate the power which will enable him to reap even larger financial rewards from well-heeled donors, he has embarked on a haphazard tariff roller coaster. Those close enough to the presidential roller coaster car, can see the track ahead and make investments in a timely manner.

As the pendulum swings away from globalization, we will be forced to avoid the cheaper labor of international markets. This will result in inflation. Inflation hurts the little guy much harder than the more affluent. Tariffs also hurt the little guy more than those with enough capital to pay for an exemption from the tariff master. As the pendulum blade drops ever lower, the less affluent have been positioned to feel the first cut.

Trump’s nationalistic songbook resonated with the manosphere where populism, violence, power, primal urges, and patriotism are often blended into a toxic cocktail that can feed a level of euphoria. Like most mind-altering drugs, the high may be pleasant but the hangover can be intense. This group is generally ill equipped to see beyond their influencers to realize their own predicament. That pendulum will eventually swing in the other direction, and as it lowers, we are all more at risk of being cleaved in two.