Extremists

See Ben Wildavsky on how higher education won the recession. 

The headlines crawl across a motley collection of extremist blogs, web forums, Facebook pages, and YouTube channels, like a Times Square ticker from hell. "Government Silently Positions for Martial Law as Financial Collapse Arrives in America." "Report: Soros Unloads All Investments in Major Financial Stocks; Invests Over $130 Million In Gold." "U.S Banks Told To Prepare For Total Collapse!" "Billions of $ to Israel as U.S. Government Flounders under Record Foreign Debt." "Banks Can Legally Steal Customer Funds From Private Checking Accounts."

As the U.S. economy has struggled back to life, its woes have emerged as a unifying theme among Americans on the fringe. The right-skewing Patriot movement may not share social values with left-leaning anarchists, but both groups point to and fixate on the same economic stories: bank insolvency, currency devaluation, derivatives fraud, total-collapse scenarios, the perniciousness of the Federal Reserve, and the need to return to a gold standard. Extremists in America — from militias to the Black Bloc (the masked, militant subset of the Occupy movement), from sovereign citizens to homegrown jihadists — are reading the same economic headlines and pondering the same potential tipping points. (Trustworthy data on how many extremists or extremist groups are active in the United States is hard to come by, but the extent of the phenomenon is undeniable. This article alone draws from upwards of 400 U.S.-based websites generating thousands of posts per day.)

Of course, the granddaddy of extremist financial scenarios — The Protocols of the Elders of Zion — long predates the Internet age. The infamous 1903 document was a hoax indicting Jewish bankers in a conspiracy to control the world, an idea that reached full, terrible maturity in Adolf Hitler’s Mein Kampf, which blamed Jews for Germany’s economic collapse following World War I.

Today’s extremonomics scenarios owe more to current realities than historical lunacy. The DNA of these anti-Semitic fantasies lingers, sometimes reinterpreted as elaborate plots run by the Bilderberg Group or the Council on Foreign Relations. More and more often, however, the enemies of financial security are simply Wall Street and Washington. In a sense, these are reality-based conspiracy theories, eschewing the most extreme claims in favor of worst-case readings of economic realities and near approximations thereof. They are terrifyingly mainstream — and that’s what makes them so dangerous.

The trend toward reality-based conspiracies extends well beyond economics, but since 2008, the financial crisis and ongoing recession have provided copious grist for the mill, reinforcing the crucial expectation shared by most domestic extremists: America’s imminent downfall.

You don’t have to be extreme to worry about economic collapse. Over the last two decades, the complexity of the global financial system has grown exponentially. Incomprehensible products like derivatives are only the tip of the iceberg. The stock market has become so complicated it is mathematically impossible to design a model that can predict its behavior, let alone the rest of the global economy.

The perils of such a system are clear. Consider the following quotes, taken not from extremist websites but from coverage of the financial crisis by PBS’s Frontline:

• "[We were] sitting in that room with Hank Paulson saying to us, in very measured tones, no hyperbole, no excessive adjectives, that ‘Unless you act, the financial system of this country and the world will melt down in a matter of days.’" —Christopher Dodd (D-Conn.), former chairman of the Senate Banking Committee

• "The chairman of the Fed said, ‘If we do not act now, we will not have an economy by Monday.’" –Rep. Nancy Pelosi (D-Calif.), former speaker of the House

• "If we did the thing wrong, everything was going under." —Austan Goolsbee, former Obama White House economic advisor

• "We don’t even have, as a country, in our regulators and our policymakers, the basic knowledge that they need about how our financial system operates." —Phil Angelides, former chairman of the Financial Crisis Inquiry Commission

The last point is especially important because in a realm where no one speaks with authority, anyone can be an expert. And on the fringe, "expertise" is a hot commodity indeed. Compare the quotes above to recent comments on extremist blogs and websites:

• "Trillions of dollars are owed, and as a country we have no way to make good on that debt. Confidence in the US dollar will soon be lost, and when that happens we will experience a collapse in the United States and the global economy unlike any that has ever been witnessed in the history of the world." —survivalist blogger

• "The Federal Reserve cranked out an incredible 16 trillion dollars to bail out banks and major corporations between 2007 and 2010 in the aftermath of the subprime mortgage crisis.… Now that the extent of the Federal Reserve bail out has become known, there will be public pressure against a similar massive bail out in the future and a good chance that the next big panic could lead to a stock market meltdown." –white nationalist David Duke

• "A source in the Deutsche Bank claims that in 2008 our financial and monetary system completely collapsed and since that time the banking cartels have been ‘propping up the system’ to make it appear as if everything was fine." —Occupy blogger

Here’s what’s especially worrisome: Every credible piece of evidence that supports the economic-collapse scenario can be leveraged to sell two more extreme ideas, whether it’s hoarding gold and canned goods or arming yourself heavily in advance of a breakdown in civil order. Reality-based arguments have a twofold effect — attracting new recruits while reinforcing the commitment of those who are already true believers. But to what end?

Consider Greece, a real-life test lab where some of the worst-case scenarios of economic collapse and civil unrest are coming true on a daily basis. Hundreds of extremist blog posts over the last 12 months have discussed developments in Greece, where both anarchists and neo-Nazis have increased their visibility and violent aggression ever since mainstream politicians drove the economy right up to the edge of the proverbial cliff. The neo-Nazi political party Golden Dawn won nearly 7 percent of the national vote in this June’s parliamentary elections, a massive increase from the 0.29 percent it netted in 2009.

Although Greece has not (yet) toppled into total chaos and open insurrection, there’s no question extremists are making headway and giving hope to their counterparts in the United States. American anarchists, neo-Nazis, and Anonymous cyber-radicals have all issued statements of solidarity with their counterparts in Greece, and many are watching the situation there as a harbinger for the future of the United States.

One prominent American anarchist website recently summed up the lesson of Greece and the gift bestowed by the economic crisis:

Let us arm ourselves with the courage and determination to face this world down, let us rid ourselves of resignation and acceptance, let us embrace what was unimaginable yesterday, and is today entirely possible: insurrection against the existent.

Is it all just talk? Maybe. But American extremists of every stripe are increasingly following the same headlines and hearing the same alarm bells, most visibly in the economic realm, but also in stories of mass shootings, government surveillance, and civil liberties. Some might be tempted to take action. After 9/11, it’s anyone’s guess how Americans and their government might respond to a spree of attacks from every political direction. Here’s hoping we never find out.

See Joseph S. Nye on how declinist pundits won the recession.