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Why the Idea of Secession is Spreading

More and more Texans want to leave the Union...

AMERICA succeeded largely because it was a single, centralized nation, writes Daily Reckoning founder Bill Bonner.

One of the largest, richest landmasses in the world... populated by one people. No trade barriers kept the Indianans from selling to the Texans. No immigration police kept the Vermonters from moving to Florida. And no language barrier kept the Californians from sharing their latest fashions with the New Yorkers.

But centralization is only a benefit some of the time...not all of the time. Now, the big ship of state is loaded to the gunwales with debt, financial obligations and delusions of imperial grandeur.

The weight of all that debt was elucidated for us in the pages of yesterday's Wall Street Journal. Unfortunately, we threw away the paper before boarding the plane for Florida. But we remember the story. And if we're off by a trillion or two...so what? It won't make any difference.

You might remember, for example, the US deficit for this year is said to be $1.1trn. That's the number reported in the press. But the real number is much higher. The real deficit, including the deferred expenses inherent in Medicaid and Social Security and so forth, is over $7trn.

And the real debt is usually misreported too. It's not $16trn – roughly equal to GDP. It's more like $70trn...five times GDP. And even if you took 100% of all the income earned by America's taxpayers...it still wouldn't be enough to pay these debts and obligations.

Nobody talks about it. Nobody wants to think about it. Because the nation is going broke... and the only way to avoid it is to prune those spending programs heavily. We're not talking about paltry 'fiscal cliff' cutbacks... or sequesters. We're talking real chainsaw cuts!

What politician wants to mention that? And what clever state wants to stay on this sinking ship?

Cometh the problem... cometh the solution. Everybody's talking secession. The Scots and the Catalans are already voting on it. Many of them want out. And here comes the Great State of Texas, formerly the Republic of Texas...getting the itch too:

With Stickers, a Petition and Even a Middle Name, Secession Fever Hits Texas

'HOUSTON – In the weeks since President Obama's re-election, Republicans around the country have been wondering how to proceed. Some conservatives in Texas have been asking a far more pointed question: how to secede.

'Secession fever has struck parts of Texas, which Mitt Romney won by nearly 1.3 million votes.

'Sales of bumper stickers reading "Secede" – one for $2, or three for $5 – have increased at TexasSecede.com. In East Texas, a Republican official sent out an e-mail newsletter saying it was time for Texas and Vermont to each "go her own way in peace" and sign a free-trade agreement among the states.

'A petition calling for secession that was filed by a Texas man on a White House web site has received tens of thousands of signatures, and the Obama administration must now issue a response.

'And Larry Scott Kilgore, a perennial Republican candidate from Arlington, a Dallas suburb, announced that he was running for governor in 2014 and would legally change his name to Larry Secede Kilgore, with Secede in capital letters. As his Web page, secedekilgore.com, puts it: "Secession! All other issues can be dealt with later."

'"Our economy is about 30 percent larger than that of Australia," said Mr Kilgore, 48, a telecommunications contractor. "Australia can survive on their own, and I don't think we'll have any problem at all surviving on our own in Texas."

'Few of the public calls for secession have addressed the messy details, like what would happen to the state's many federal courthouses, prisons, military bases and parklands. No one has said what would become of Kevin Patteson, the director of the state's Office of State-Federal Relations, and no one has asked the Texas residents who received tens of millions of Dollars in federal aid after destructive wildfires last year for their thoughts on the subject.

'But all the secession talk has intrigued liberals as well. Caleb M. of Austin started his own petition on the White House web site. He asked the federal government to allow Austin to withdraw from Texas and remain part of the United States, "in the event that Texas is successful in the current bid to secede." It had more than 8,000 signatures as of Friday.'

In the words of our friend Nicholas Taleb, central governments have become 'fragile'. Even a small storm could sink Greece...France...or the US.

And why should Texas go down with the ship?

Who owes the debt? The central government. Who made the promises and borrowed the money? The feds. Whose government is run by the zombies, for the zombies and of the zombies? That's right...Washington's government.

So, it makes sense to give the feds the heave ho. Texas would be better off on its own.

We're planning on starting our own secession movement in Maryland. The Old Line State failed to secede in the War Between the States. Taking a middle road of neutrality. This time, we're hoping Maryland will correct its error.

Free Maryland!

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Bill Bonner has co-authored a number of New York Times Bestsellers including Financial Reckoning Day, Empire of Debt and Mobs, Markets and Messiahs. In his own opinion, Bill's most recent title, A Modest Theory of Civilization: Win-Win or Lose, is his best work yet. Bill also founded The Agora, a worldwide community for private researchers and publishers, in 1979. Financial analysts within the group have exposed and predicted some of the world's biggest shifts since that time, starting with the fall of the Soviet Union back in the late 1980s, to the collapse of the Dot Com (2000) and then mortgage finance (2008) bubbles, and more recently the election of President Trump.

See full archive of Bill Bonner articles

Please Note: All articles published here are to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it. Please review our Terms & Conditions for accessing Gold News.

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