American tables are not as dependent as Iceland's on imported food. But for the past several years, we have imported more food than we have produced. And now that short-term commercial credit has frozen, getting imported food to supermarkets and other retail outlets has suddenly become much more difficult. The effects of this development are yet to be felt, but they will be manifest in due time.
Icelanders are denuding supermarket shelves of basic household needs, from fresh produce to canned items to light bulbs. This is as close as that island's small, tranquil, and relatively homogenous population comes to an outright riot.
When Americans face the same circumstances -- and we will -- we can expect to see localized eruptions of Bedlamite violence that will make the 1992 L.A. Riots look like a series of mild high school pranks.
I'm cynical enough to think that our rulers, who eagerly seize power under the pretext of crises,
are counting on an upheaval of this kind in order to propel us into the "New Bretton Woods" global financial system now being openly discussed.
Evil designs: John Maynard Keynes (left) confers with Harry Dexter White at the 1944 Bretton Woods Conference.
Eventually this would be an updated and fully realized version of the Bretton Woods system as originally envisioned by the detestable John Maynard Keynes and his comrades, which would be built around a world central bank and a world fiat currency (Keynes suggested that it be called the "bancor"; Keynes' comrade Harry Dexter White wanted to call it the "unita").
This was seen as a bit too ambitious in 1944. In 2009, this proposal may be embraced by many as the only alternative to the complete collapse of the world economy. And the political class both here and abroad is doing its part by enacting policies that are certain to fail.
There is already a de facto global financial system in operation, as the United States and the governments of the various European Union states implement exactly the same policies on both sides of the Atlantic: Socialize the bad banking assets, and nationalize any good ones that remain. This amounts to a global race in which the finish line is economic oblivion. The U.S. may not be the nation that breaks the tape, but we'll get there eventually.
The Triumvirs assemble: While the Bushling (off-camera) recites his scripted lines, Henry Paulson works on his Mussolini impression and Bernanke channels Lenin.
Yesterday, Commissar Paulson, head of the Directorate for Protection of Plutocratic Assets, summoned the CEOs of nine "healthy" banks to announce that the Regime is taking a controlling interest in each of them. Eventually, the Regime will take control of thousands of smaller banks and financial institutions.
As Megan McArdle of The Atlantic observes, the Regime is first recapitalizing the big, "healthier" institutions, rather than the sicklier ones, in order to defer, for as long as possible, public disclosure of the condition of the banking system: "In this case, the government is specifically fighting to keep the market from getting information about whose balance sheets are shakiest [and] ... recapitalizing only the weak ones would send a message about their balance sheets that might trigger the run he is trying to prevent."[video:http://www.youtube.com/watch?v=jB9fuIvksLw&feature=dir]