Looking at America and the World – 2024

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Staff Report

There has never been a time as we reflect back over the last half century when America was not faced with big problems whether that was on the world scene or here at home. Are there big differences between our problems years and decades ago from what we face today? Sure, there are always differences but there is also much similarity.

Generally speaking, we believe that today is the very best time in world history to be alive on this planet; we emphasize the phrase, “generally speaking.” Because if you happen to be residing in the Ukraine for the last two years, it certainly is not true. So, let’s explore some topical issues and see where it leads us.

United States and our Medical System

It is true that we have the finest medical care in the world and no one is even close. The problem is that we pay too much for what we get.

We probably today spend about $4.5 trillion per year on our medical needs and this is a huge number for an economy doing almost $28 trillion this year. It’s about 17% of GDP and continues to climb. Now this is very simple. No one is going to do anything, not a thing about health care costs until there is a groundswell of anger towards current costs. No anger, no changes, its as simple as that.

It is most surprising is that any of these US researched and created drugs can be bought in any drug store outside our country for far less than what we pay here. An example would be Xarelto which is a blood thinner used daily by heart patients. In the US you pay $16 to $20 per pill over the counter without a drug plan. In Turkey, India, or Germany you can buy it under $2 per pill. Big difference.

Now you say what good is Turkey or India to you. Well, you can buy it through any Canadian pharmacy with an American signed prescription for those low prices 7 days per week. Jardiance is probably another $700 per month heart medication. Its less than $100 per month through Canada.

It is obvious that we are spending probably a 100 to 200 billion per year too much as Americans for our drugs. Where’s the Congress on this you ask? The answer is on the other side drug company contributions for their campaigns.

Is the Inequity between Rich & Poor REAL?

We are informed all the time in America that the gulf between our rich people and poor people is so vast and it has never been vaster than it is today. Realties are somewhat different. First of all, just about all Americans who have worked for years are covered by Social Security.

Secondly, our poor in this country are covered by Medicaid. Our elderly are entitled to Medicare which is health insurance coverage. Would you not agree with me that when we want to explore the inequities between rich and poor, that we have to include the dollar amounts for these three programs in the discussion. Well, I am here to tell you that economists in country do NOT include these numbers which amount to trillions of dollars.

Government is Dysfunctional and Getting Worse

Part of this argument we can buy into, some of it, not really. First of all, the founding fathers wanted government to be this way. They did not want to make change that easy. They wanted change to be tough. Here’s proof. They staggered the Senate so that every two years, one third of the US Senate is up for election. This means in a landslide; you would only be able to effectively take out one third of the Senate. This means one party would have to favored over a six-year period to really take over the Senate and that really doesn’t happen. This shows how much the founding fathers were fearful of change.

A second major point is that we have almost evenly divided government. This is radically different than the last 90 years and this even power sharing is only in the last 30 years since Newt Gingrich ran the House in the 1990’s. from 1932 to the early 1990’s the Democrats controlled basically both Houses of Congress.

There we probably about four years during that period when the House was Republican controlled. We recall 2 during Truman’s Presidency, 2 during Eisenhower’s and that’s it. The Senate was again e years apiece for Truman, Eisenhower, Reagan and that’s it.

It was so lopsided that when the Republicans took the House in 1994, the Democrats had been in power so long that they refused to given up their preferred parking spaces closer to the entrances of the building. Some of the cars were forcibly removed.

Once control of the Congress became competitive, now the anger set in and it’s been like that for 30 years.

Yes, the Democrats impeached Trump twice, but the Republicans impeached Clinton also. And you know what they say about PAYBACK. For all the talk of dysfunctional government we can remember during the financial crisis in 2009,

Nancy Pelosi brought the powers that be in a House meeting room and decided to give the Secretary of Treasury $800 billion to help resolve a banking crisis in all of 20 minutes. When decisions have to be made, they do get made.

We do mourn the fact that it takes 10 years to build a major bridge today in our country but we manage to take down Adolph Hitler in 39 months from Pearl Harbor to April, 1945. The problem in our opinion is one of WILL. We have more brain power in America than at any time in our nation’s history. At the same time, we seem to lack the will to effectively execute and get things done. This has to change to remain a major world power.

Speaking of World Power

We have given considerable thought through the years as to why American dominates the world at the moment and has since World War II, and its not going to change anytime soon.

We believe it has a lot to do with geography and nobody ever talks about this. There is not country today or in history that is more blessed with fabulous natural geography than America.

The Mississippi flows from the Gulf of  exico up to Minneapolis, Minnesota and then a few miles north of Minneapolis it continues again up north into Canada.

To the East are the Great Lakes which  ontinue to the Erie Canal and then East to Albany, NY and south to the New York harbor into the Atlantic. The mighty Missouri goes west for thousands of miles.

Here’s another story just as big. Down in lower eastern Texas all the way up the Gulf coast and east through Louisiana, Mississippi, Alabama and then Florida you will find the outer barrier islands and go on for thousands of miles.

These islands swing about the entirety of Florida and then for a thousand miles and more go all the way up the East coast of the United States to Maryland. These islands act as a barrier protecting the mainland and all shipping moving along the coast line. There is nothing in the world like this.

No country in Europe can touch it. South America, no, nothing in Asia and we will have it forever. Any shipping you want to do by truck, by rail, any method is 12 times more expensive than we can move it on our magnificent river system or by our coastline protected by our outer barrier islands. We will remain cost competitive forever with any country in the world and nobody talks about it.

What’s the Deal with GLOBAL WARMING?

We have put a lot of time and energy into understanding this issue and what surrounds it. The first problem is that our political parties have decided it is in their best interests to politicized this issue ad opposed to treating it as an important issue independent of political advantages that can be gaining by joining one side versus another. Here’s our take:

• It’s important to recognize and appreciate that no energy source in history has ever been replaced by another energy source in under 40 years, and fossil fuels is not going to be any different. If you want to move away from our current energy grid, the buildout of the infrastructure will take decades, not five or ten years.
• Electric cars will not replace internal combustion engines at any time in the near future. Ninety percent of the people in California who have bought electric cars when polled say they will NOT buy another one. The problems with fear of running out of fuel on distance trips combined with the lack of easy to find electric fueling stations, plus the cost of battery packs ($5,000 to $20,000) which is just now starting to hit are inhibiting factors regarding the widescale adoption of this new technology.

There is also the consideration that you must realize that even though your car maybe electric, what really matters is the source of the electricity for your car. For instance, if you live in West Virginia where 69% of all electricity is generated by COAL than your car is running on 69% of its fuel being coal generated.

• If one wants to talk about WIND and SOLAR than consider this. The best places to generate wind and solar are in the Republican controlled states. For wind is the Great Plains of the United States. Those wideopen states in the Midwest which have hundreds of miles of uninterrupted wind sources when there is a wind. For Solar, you want Colorado and places like Texas, New Mexico, Arizona where you have enormous amounts of sunlight.

One more thought on this and nobody thinks about it. Wherever you have a huge amount of wind or solar energy generation for large numbers of the population to use, you must have a large conventional gas or fired generator capacity available to come online immediately for those occasions which are very frequent when the wind isn’t blowing or the sun shining.

Is Nuclear War in the Offing

There are three hotspots in the world today. We will cover each briefly. We could write a 100-page synopsis on each. They are the Ukraine, Taiwan, and Israel / Hamas.

UKRAINE

Nobody has ever really explained the Russian position on this war and we are no friends of the Russians but we do need to understand how they look at this war for Americans to make an informed decision. During World War II America lost 450,000 young American soldier’s lives. The Russian numbers may have been as high as 20 to 30 million. Over the centuries the Russians were invaded numerous times. The biggest invasions of the last 2 centuries were Napoleons invasion in the early 1800’s and the Nazis under Hitler around 1940. Even today, 80 years later, everybody in Russia has relatives who died under Hitler’s invasion. The Russians do not want it to happen again. We formed NATO in the late 1940’s to unify Europe against a potential Russian invasion from the east. Russia believes or not fears a European invasion from the west.

This provided the impetus for Russia under Stalin to take as many of the eastern European countries as they could and make them satellites. The Russians were forming buffers against a potential invasion on their western border. When the Soviet Union fell in 1990 and it fell very quickly, the United States promised that NATO would not be expanded to the east. Over the next decade NATO took every eastern European or former Soviet satellite state it could and brought them into NATO making them full fledged NATO members. Russia and Putin have not forgotten this and it weighs heavily into their thinking.

As we sit here today, we do not see a set of conditions where by the Ukraine will become a NATO member. This is unthinkable to the Soviets. We would
have our tanks, airplanes, bases, artillery, and infantry 500 miles from Moscow. Russia can’t live with that.

So how is this going to end. It will end with a negotiated settlement probably with the Ukraine ceding some territory formally like Crimea which the 

Russians already control and a formal in writing understanding that the Ukraine will be an independent non-aligned state without formal ties to NATO.

The United States does not want war with Russia and there are some things Russia will not tolerate. Timeframe another one or two years because it will take that long for our country to get formally tired of funding the war even though it is cheap compared to the men and materials we would have to put into the effort if we were fighting it.

TAIWAN

Chiang Kai Chek was the leader of China for decades prior to World War II. Mao Tso Tung a communist fought him for decades prior to the communists winning the war in the late 1940’s and the Chek forces fleeing the mainland and going to the island of Taiwan also known as Formosa and they have been there ever since. Well, the Russians want the Ukraine back, and the Chinese mainland wants Taiwan back, and we do not want to give it to them.

Every now and then for the last several decades, the Chinese attitude to Taiwan flares up, and they huff and they poof, and they want Taiwan back and make bellicose soundings about it. It’s not going to happen anytime soon, if it happens at all. And the only way its going to happen is 1) if Taiwan
wants it to happen – unlikely, or 2) the Chinese launch an amphibious invasion to take it by force, which takes American into a Naval war against China.

The second was General Douglas MacArthur’s landing at Inchon, Korea during the Korean War. He landed tens of thousands of American and Allied troops behind the enemy lines in an amphibious invasion that the generals in the Pentagon said could not be done and is still studied at West Point today.

The Chinese will not be able to pull either of these types of landing off in Taiwan. Here’s why:

• It would take months for the Chinese to prepare for the assault from the mainland. Our satellites which monitor the whole area hourly would pick it up and there could be no surprise landing. Remember, it’s almost 100 miles away. We could destroy the landing craft in the water, they would not make it across.

• We have already leased land on the Southern islands of Japan, and the Northern islands of the Philippines, and we are loading those islands own with missiles, aircraft, artillery systems, and everything it can hold. These islands are all withing range of Taiwan. If war breaks out, we will have an armada of assorted weapons and God knows what else ready to kill wave after wave of whatever the Chinese use to wage war. 

• We have several Super Carrier fleets in the Pacific, each one with more fire power than has been used in all wars on earth since the inception. Each carrier is accompanied by 20 to 22 war ships including Aegis war ships which can fire literally hundreds of missiles into the air simultaneously to destroy anything incoming.

• The Chinese Navy in spite of anything you have heard is not competitive to the United States. It is NOT a Blue Water Navy meaning it is not built to travel throughout the world. It is a Coast Guard type Navy to protect the coast of China. In fact, the biggest best Navy after the United States is surprisingly JAPAN, and Japan is our ally, not China.

• China would cross the sea going East and be faced with the West Coast of Taiwan, which is useless to them. Going north and south down central Taiwan are a series of mountains 12,000 to 14,000 feet high. Guess what, China is not climbing those mountains. They need to come around either Northern Taiwan or Southern Taiwan to get to the East coast of Taiwan and that is going to be a very big problem.

• Taiwan’s decision is that if the  hinese attack, Taiwan will destroy the semiconductor chip factories on their own island first before giving them up. In addition, the Chinese would not know how to run those factories. Their technology and management skills are simply not up to snuff to deal with it. If you can’t control the Taiwan advanced technology on Taiwan, why bother trying to invade.

Put it all together and would you invade Taiwan if you were China. There is a scenario where we would go ahead. If the political situation in China became so untenable, as an example, the economy collapsed, massive riots in the streets, then it is possible China would invade regardless of costs, to defer public opinion in support of a war for mother China. Other than that, we don’t see it happening.

ISRAEL / HAMAS

Why did Hamas come across the Gaza Strip on October 7 of last year and kill a 1000 Israelis and kidnap hundreds of others and commit atrocities unlike anything Israelis had experienced since World War II? This was Israel’s greatest loss of life since the 1940’s. perhaps just as important going forward is how all of Israel’s legendary intelligence services including the Mossad fail to see it coming. This is not Iran striking a country 500 miles away. Gaza is in plain sight. The Jews have spies in every section of Gaza, their own and paid informants. There were months of planning involved in this operation. All of the participants which had to number in the thousands had to keep quiet (operational security) and not reveal their plans to the Israeli’s.

Israel was clueless that this was going to happen and even while it was happening. Most of the soldiers guarding that area were on leave for holiday celebrations. And then the swarm hit. Months from now the Israeli Prime Minister will fall on his sword and be replaced. That’s just a simple fact of life. You are the leader, you fall.

The real story is Iran which is behind the whole deal, as it is behind the problems north of Israel, and the Houti’s in Yemen, and forces in Iraq. Their fear which is rational is that Israel and Saudi Arabia were about to enter into a pact and become partners for peace and security in the region as well as development. This is no different than the vision Richard Nixon had for the area in the 1960’s when he formed a triangle relationship between Saudi Arabia, Iran under the Shah and America.

Saudi Arabia would provide the money. Iran the military might and the United States everything else. It was all good until the Shah of Iran was overthrown in 1978 by the Mullahs. Iran then turned against us for 40 plus years and counting. We always thought and were hopeful that Iraq under Hussein would replace Iran in the triangle. Hussein would not play ball and we ultimately deposed him during the Gulf War.

Now if you haven’t noticed we the United States have basically dropped out of what we perceived previously to be our security responsibility in the regions. This is part of America’s long-term retrenchment from policing the sea lanes and letting everyone know, they are on their own now and that includes China. More on this in another write-up because it will become the dominant international theme over the next 10 years. We are moving back into our own hemisphere, while still maintaining a fabulous Navy to deal with any contingency that occurs.

Iran hoped through the Gaza invasion into Israel to break up the Saudi Arabia / Israeli peace accords and nullify them from happening. The feeling was that Saudi Arabia being an Arab state would be forced to come to the public aid of Gaza. This peace / security accord is going to happen anyway.

Nevertheless, this region remains an explosive powder keg which may or may not happen. It could very easily drag in several other countries and engulf them in a huge conflict that very few have ever seen before. Russia which has been aiding pro Russia Syria would love to see it happen. Keep in mind that all of Europe, China, the rest of Asia and Southeast Asia is totally reliant on oil for energy from the Gulf. America no longer thanks to fracking is reliant at all on the area.

We are energy independent, thanks to technological advances and a free business culture still in place. So why do we have two super carrier fleets in place in the Persian Gulf. It’s a
show of massive force and fire power to try to keep the place from going up in flames and so far, it’s working.

CONCLUSION

The world at the moment is not particularly a pretty place and it is entangled. The Chinese are watching the war in Ukraine waiting to see if America’s will falter. If so, it will embolden them towards their desire to take back Taiwan. The Russians are excited about the war in Israel with Hamas.

They feel it will deflect the world’s attention from their invasion into the Ukraine and they are right. The front page of America’s newspapers is no longer dominated by their war. Republicans in Congress are moving away from Ukrainian support clamoring for spend the money at home and they see support for the war wavering. America is now funding $50 billion plus into the building of new ultramodern computer chip factories in Texas, Nevada and Ohio to build an independent capacity for manufacturing obviating the need to rely on sources outside our country.

Foreign companies, even Taiwan Semiconductor are investing billions to build here as well. The world is changing and this very much affects investor sentiment and the stock market here in America. Stay tune for more.

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