The '60s Revisited in Oklahoma

 

The recent bombing of the Federal Building in Oklahoma City was disturbing in any number of ways, of course. Its meaning from a financial and social viewpoint are worth some examination.

I'm not completely sure how to put the bombing in a financial context, but what springs to mind is the late '60s and early '70s. There were numerous race riots, violent protests by all kinds of militant groups, seemingly politically motivated bank robberies featuring the likes of the Symbionese Liberation Army, outrageous murders by the Manson family, and numerous bombings by outfits like the Weathermen. I was living in Washington, D.C. at the time and remember being caught up in at least three really violent incidents just because I was in the wrong place at the wrong time. I remember the Feds surrounding the White House with buses and letting the air out of their tires so the mobs couldn't crawl under them. Meanwhile. the government was running massive deficits for the first time since World War II in the pursuit of guns and butter. which resulted in a series of devaluations, oil, and monetary crises.

In retrospect, it may have been about as tumultuous a time as this country had since the Civil War. But the market didn't care. Common stocks exploded to manic highs in 1966 and 1968, incited down to a panic bottom in 1970, soared to manic highs in 1973, and then bit the dust bigtime in 1974. The market's ups and downs don't correlate in any way I can determine, with what then seemed like the imminent collapse of Western Civilization. But it was a period of extreme volatility, which ended in a prolonged malaise, lasting until the final bottom in 1982.

The political and social unrest we've seen so far in the '90s is small potatoes compared to the '60s. But I think it's a fair bet that momentum is just building. The standard of living of the average worker has been declining, (notwithstanding, tremendous advances in technology) by many measures since the early '70s. Taxes and debt levels are far higher.

Most important, the U.S. government is far larger, more powerful, and more intrusive now than it was back then. It was one thing when, a generation ago, the FBI and other agencies were used against blacks and wild-haired radicals~ the average American saw that as somehow defending his way of life. But starting with the tax revolt movement of the early '80s, many in the Great Middle Class started seeing the government as targeting not just some belligerent minority or subversive hippies, but themselves.

Suspicion of the government grew as seizures by the DEA, FBI, Post Office and Secret Service expanded. Widespread knowledge of the FDA's suppression of alternative therapies (laetrile, chelation, vitamins, tryptophan, etc., etc.) alienated many others. More and more people are becoming aware that the FCC is causing the U.S. to become a second-class citizen in communications, with its interminable delays in licensing. Increasingly large numbers of people in the financial business, who'd never previously given the government a second thought except at tax time, are becoming highly antagonistic as the SEC steps up its enforcement activities against "penny stocks" and insider trading, with continuing assaults on freedom of the press. OSHA, EEOC, and numerous new environmental laws have driven many small businesses t( the brink of bankruptcy.

And I'll make book that the doings in Mena. AR, the death of Vince Foster, Hillary's spectacular commodity trading record, and miscellaneous other crimes and misdemeanors of the Clinton regime will eventually be exposed fully. When they are, they'll totally dwarf Watergate. In fact, it's only because their implications are so serious that they haven't been brought to light.

There are hundreds of examples like those above. All have served to create a diffused and somewhat inchoate rage beneath the surface of' society, among many groups of otherwise "'Solid citizens." It seems probable that the sparks that lit the fuse leading to Oklahoma were the government's assault on Randy Weaver I s family, followed by the massacre of over 80 people in Waco. Those events didn't mean anything to most people, who still feel that the FBI and its sister agencies resemble the movie and TV propaganda that's apotheosized them for so long (although even that's changing witness recent movies like "Die Hard." -The Professional," "True Romance," and many others that portray them as arrogant, venal robots). But they catalyzed gun owners and members of small religions in particular. The upshot of that was the rise of militias across the country.

 

Militias and the media

I don't really know who belongs to the militias, nor do I know any of their members, nor even what they really believe. One thing I do know is that the media's reports on them are totally spin-doctored. No doubt the militias have their share of nutballs, white supremacists, and people with nothing to lose; but not much more than the population at large, though you'd never know it from the way they're being demonized by the media. That's predictable, however.

The media is almost exclusively populated by members of the New Class, whose values are fundamentally at odds with those of the average American. The average media person is a leftist, who sees these movements as right wing since they share a theme of property rights (guns, taxes, regulations, etc.). The average media person is very well connected to the government, since that's the source of most of today's news; they are very loathe not to toe the party line, and compromise those connections. The average media person (and absolutely those on the upper levels) is quite well off; it's only natural that people at the top of society are threatened by any change in the status quo.

Regardless of what the facts are, it's foolish to believe anything coming out of the popular media on this issue. But while the average person certainly doesn't think for himself, and is therefore quite susceptible to propaganda, he's also highly suspicious of the media now- something which never used to be the case. So my guess is that all the agitprop against the militias will backfire, and they're likely to grow. Many who didn't know they exist will seek them out.

Is this a good thing? I think so, as long as the militias and similar groups stay cool and nonviolent, they'll act as a counterweight to increasingly bureaucratic, self serving, and aggressive federal agencies. Insofar as there's a "problem," it's not going away until the federal government downsizes to the point where it doesn't threaten wholesale parts of the population. Fat chance, despite the best Republican rhetoric. Au contraire, the most offensive and macho agencies - FBI, ATF, DEA, and the like - are rapidly expanding to counter the perceived threat. So what's likely to happen is more violent confrontations. Hence my expectation of a replay of some of the more violent aspects of the '60s. One big wild card Is the reaction of foreign terrorists. No doubt Muslims and Middle Easterners were thrilled when the initial blame for the bombing was reflexively pinned on them.

The way I see it, this is all just a subset of what will become an increasingly venomous and defined battle between the interest groups (the New Class, Neo-Puritans, and various subsets of the Baby Boom generation) discussed at length in Chapter 31 of CI '90s. It will not be mellow.

Just as in the '60s, you can't say what it will do to the markets, except add to their volatility. And from here, "volatile" is likely to equal "down."

P.S. I used the term "Civil War" above, but I'm convinced that it's quite inaccurate. A better term would be "The War of Southern Secession." A civil war is one in which antagonistic groups are fighting for the control of an existing government. The 1861-1865 unpleasantness, however, was about the desire of a group of 13 states to leave the Union (in which action they were quite within their legal rights). The North-entirely for economic reasons having absolutely nothing to do with principle, slavery, or the like-mounted a war of aggression against the South to, in effect, conquer it and keep it as a colony. This is a very brief encapsulation of a view that's controversial (because the winners transform their propaganda into history). But I believe it's an accurate view. Further reading? I suggest you order The South Was Right! by J.R. and W.D. Kennedy (Pelican, Gretna, LA, 1994, $22.50). The volume is a little too emotional and polemic in tone to suit me, but it presents a most interesting body of fact. And its publication is symptomatic of the rapidly growing strain of dissatisfaction and disillusion that's sweeping the country.