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When This All Blows Up: The Next Economic Crash

April 11, 2017
 Outside Source

Contributor

Editor's Note: The following is a guest post by Chris Martenson with PeakProsperity.com.

This report marks the end of a series of three big trains of thought. The first explained how we’re living through the Mother Of All Financial Bubbles. The next detailed the Great Wealth Transfer that is now underway, siphoning our wealth into the pockets of an elite few.

This concluding report predicts how these deleterious and unsustainable trends will inevitably ‘resolve’ (which is a pleasant way of saying ‘blow up’.)

The Ka-POOM Theory

In terms how this will all end, we favor the scenario put forth by Eric Janszen in 1998 called the Ka-POOM theory.

This theory rests on the belief that the Federal Reserve along with the other world central banks looked at Japan's several decades of economic stagnation and decided that deflationary recessions are to be avoided at all costs -- even if that means blowing asset bubbles and then cleaning up the destruction left behind in their aftermath.

Because the Fed, et al. have a limited playbook (which is: print, and then print some more), the Ka-POOM model calls for limited periods of disinflation, followed by massive money printing sprees that then produce high inflation.

Despite the trillions and trillions in thin-air money printed by the world's central banks over the past 8 years, a common rebuttal we hear is “But there’s been no inflation so far!” To which I reply, “Yes, that’s what we're being told. But that's not actually true.”

Remember: inflation is simply “too much money chasing too few goods.” We can detect today's excess of money in the rising prices in our cost of living -- but those higher prices are symptoms, not causes. Inflation is not "higher prices". Inflation is "too much money".

Next, inflation is not an evenly-distributed event. It’s not like the price of everything rises 10% at the same time. The inflation rate is an average, which contains some prices going up, while others stay flat or even go down going down. It’s always a lumpy experience. The reason why is that money is not evenly distributed across the economy, and it doesn't always chase (or desire) the same things.

So the Fed and other central banks have printed up trillions and trillions of dollars, euros and yen, which they then essentially handed over to the financial markets and the very few people who work within them (as well as their biggest clients). As a direct consequence, we’ve seen enormous inflation in the prices of things that relate to that tiny universe of people – stocks, bonds, trophy city apartments, Gulfstream 5 jets, fine art, and rare gems.

These items have all gotten massively more expensive over the past decade. Just as would have happened if the Fed had printed up a trillion dollars and given them everyone living in a trailer park in the American South, with the restriction that the money could only be used to buy other trailers in the region. Do you have any doubt that the price of trailers in the South wouldn't explode upwards?

Well, that’s exactly analogous to what has happened to financial and trophy assets. The amount of money created and poured into the financial markets by that central banks has been incredibly enormous. As a first-order event, it raised the prices of nearly all financial assets. And then, as a second-order derivative, it then flowed into the properties and cherished possessions of the financial industry insiders.

The summary is that we’ve already had lots of inflation – but it has (so far) been mostly contained to the areas where the freshly-printed money was first directed. No surprise there.

But it's certainly not only been limited to the rarified items the rich enjoy. Anyone who is currently looking to purchase a home, car or college education has a pretty good idea how prices have jumped substantially over the past decade.

Here’s the thing about the attempts by central banks to circumvent the workings of the actual economy by simply printing up money: It is doomed to fail. It always does; one cannot simply 'print up' prosperity. Printing up money merely creates the illusion of free wealth for those with first access to it. In reality, what happens is that it secretly transfers the wealth from everyone else to those lucky few.

The Fed and the rest of the central banking cartel are consciously and very pointedly picking winners and losers.

It’s not in their power to make everyone a winner. So they have decided to throwing granny (and savers and pensions) under the bus while financial elites and well-connected speculators (e.g. JP Morgan and other large banks) extremely wealthy in the process. Wealth is being transferred from Parties B-Z to Party A – from the many to the few.

What the Fed promised would happen along with all of this money printing has not materialized. There has been no return to rapid economic growth. And there won't be, because we have massive structural problems in our economy that can't be papered over forever.

This stark fact makes the Fed's entire money printing misadventure not just pointless, but dangerously destabilizing from a social and political perspective. The world's central banks, especially the Fed, have done an enormous amount of damage. These institutions, as well as the decision-makers within them, are going to have a heck of lot to answer for when the inevitable crack-up comes.

A Quick Re-Cap

And so here we find ourselves, at the final torturous, grinding part where the final bubble top is formed. The über-bubble. The Greatest Of Them All.

A bubble this spectacular requires a top worthy of its size. A long, massive top, full of increasing exuberance -- until the very last investor is sucked in.

Where I’ve noted humans’ remarkably silly behavior during bubble episodes in the past – tulip bulbs, railroads, swampland - I still struggle to understand or even explain this one.

It’s so obvious at this point. And yet, like its brethren bubbles of the past, a lot of otherwise thoughtful and careful people are getting sucked in by its siren song.

I guess the best economic description of it might be “a credit bubble” with sub-components like sovereign and household debt, and sub-sub-components like Toronto real estate and the IPO price for SNAP shares (that’s Snapchat, which soon after its launch, had a valuation of $40 billion. This mind you, is a company that has no identifiable revenue model).

A credit bubble occurs when the issuance of credit grows faster than income supporting it. Here’s what that looks like on a national scale for the US. The bottom red line is income (GDP) and the top blue line is Total Debt. We can see that debt has been growing at twice the rate of GDP since 1970:

You have to be quite delusional to think that debt can be compound at twice the rate of income forever. Unfortunately, there are more than a few of those ungrounded optimists working in central banks and governments the world over. Their thinking is simply, The sky’s the limit!

Those of us living in reality find this mindset puerile and insulting. And, of course, dangerously reckless. And it’s also maddening to hear the media cheerleaders for Wall Street selling us this bunk as if it were somehow sensible. It is not.

Look, millions -- likely billions -- of people are at risk of getting badly hurt. When this bubble blows, it’s going to be enormously destructive and take out a lot of wealth along the way. Millions of jobs will be destroyed. What people think of as wealth will evaporate as though it never existed in the first place (it didn’t). Political dynasties and major financial institutions will be ruined.

As I wrote recently, this will be widely and popularly referred to a period of wealth destruction. It will feel that way to must, but it will be actually be a period of wealth transfer:

The summary here is this: We are still printing and borrowing enormous amounts of money and credit, but the world is not growing any larger in response. The pressure is building. Nobody knows when all of that money and credit will have to be 'trued up' against the amount of real stuff out there. But it will. History shows us that it always does.

And that moment will be referred to by most as a period of wealth destruction. 401ks will be shredded, bonds will become worthless, defaults will spike, institutions and entire countries will fail - but the truth is that all of that paper 'wealth' was an illusion. People's faith in it had been betrayed long before, when those in power started abusing the system by creating too many tertiary claims.

After the dust settles, there will be winners and losers, and those with the proper framework will understand that what actually happened was that all of the wealth was transferred from those who thought they owned it, to those who actually did.

The biggest remaining question is whether the wealth transfer comes about in the form of an inflationary destruction, like in Venezuela today, or as a deflationary bust more in the fashion of Greece.

The only thing that capable of preventing this coming carnage would a resumption of rapid economic growth. And I mean growth that exceeds the rate of debt creation.

But that's simply not going to happen.

The Problem With Growth

We can dispense with the idea of “solving” our too-much-debt problem by a resumption of rapid economic growth either by deduction or observation. Both work just as well on their own, but each tells a similar story in this case.

The deductive route notes that economic growth stimulated by ever-higher amounts of borrowing simply requires greater and greater debt loads to accomplish. Eventually debt levels simply become too high, and pinch off growth.

We can also deduce that because economic growth is tightly linked to energy consumption, lower amounts of usable energy flowing through an economy will cause that economy to stall out as well. Because we know that both the quantity as well as the net yield we get from our energy-producing activities are flattening, this explains why GDP growth is flattening too.

Thus, from a deductive standpoint, combining what we know about high levels of debt and flattening energy returns energy there’s really no more room for confusion about why GDP growth is, and will remain, anemic (at best).

Observationally, we now have more than a full decade of sub-par (i.e., ‘too low’) world GDP growth:

Notice that the last year of data, 2016, is coming in at the lowest reading since the Great Recession, while the next two years are estimated to also come in at less than 3%. The world hasn’t averaged 3% GDP growth in a decade. Even the mighty US has gone more than ten straight years without breaking into the 3% range.

We have to ask: How many years does it take to finally admit that there’s something seriously wrong with our hopeful story line that robust growth is going to save our debt-ridden bacon?

Just for the record, things are not shaping up any better here in 2017 either…

Atlanta Fed GDPNow model predicts 1.2% 1Q17 growth

And, just for kicks, we might also note that the GDP forecasting agencies of the world have consistent in over-estimating future growth. Of course, this doesn't deter them from continuing to predicting higher future growth each year. As a case in point, here are the IMF's predictions for world growth over the past 6 years:

Each of those colored lines is a forecast. Each of them foresaw growth going notably higher in the near future. Not only was every one of them utterly wrong in direction, each failed at getting even the next quarter anywhere close to right. See how none of those lines ever dips below 3%? See in the prior chart how global growth never breached 3% in any of these same plotted years?

For a variety of reasons, with aging demographics being a huge factor, future growth in the OECD countries must slow:

My ‘prediction’ is that these projections will turn out to be far too high. Mainly because I include declining net energy in my views and no mainstream economist ever does. But the track records of these outfits shows that taking the ‘under’ side of the over/under bet offers incredibly safe odds.

At any rate, the main story here is that the only way we can begin to justify the astronomical levels of debt currently on the books, let alone slathering on new tranches just to keep the whole thing form imploding, is to have a story of endless, rapid future economic growth. Which is, we've already shown, a delusional fantasy.

Stagnating growth, ever more trillions of debt, and a finite amount of depleting net energy all adds up to an unsustainable mess. With asset price bubbles everywhere and wealth transfer mechanisms already in place, the end-game involves a very few winners and a lot of losers.

Anything that is this unsustainable will someday end. But how? And how should we position ourselves for it?

In Part 2: The Ka-POOM! Survival Guide, we detail in depth the most likely progression predicted by the Ka-POOM! model. First, a punishing crash in prices as natural market forces eventually overwhelm the Fed's doomed efforts to print the world to prosperity. Think of the 2008 crash, but on steroids.

Then will come the inevitable response from the central banking cartel: Set the printing machines on maximum speed! While this may seem to work for a brief while, it will soon collapse the world's currencies in a hyperinflationary deluge.

This will be a very tricky time for preserving wealth as things swing violently from disinflation to inflation. Understanding the mechanics and knowing what to expect will be critical -- not just for safeguarding your money, but for taking advantage of what will surely be some of the best bargains of our lifetime.

Take a tour of Mercury Studios

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Come on in!

Ryan: Kanye West and the Great Society

Graphic by Alexander Somoskey.

Donald Trump has been name-dropped by nearly every major rapper of the last 30 years, starting with a reference by Beastie Boys on their iconic album Paul's Boutique, the Sgt. Pepper of hip-hop.

He's been mentioned by Jay Z. Ludacris. Young Thug. Nelly. Kendrick Lamar. Juicy J. Rick Ross. Eminem. Big Sean. A Tribe Called Quest. Scarface. Lil Wayne. The Coup. Master P. Ice Cube. Mos Def. Raekwon, Ol' Dirty Bastard, and various other Wu-Tang Clan affiliates. R. Kelly. Pete Rock. Nas. E-40.

And don't forget this surreal moment in our nation's history.

Then-candidate Trump on SNL ... dancing to a Drake parody.(Screenshot from YouTube)

When Bun B referred to Trump on the Chopped-n-Screwed anthem "Pocket Full of Stones," he was keeping with a tradition of rappers admiring Trump. This only changed a few years ago.

But then there's Kanye West, who proudly donned the red MAGA hat after discovering Candace Owens and being called "a jackass" by our nation's first black President. Then Kanye was hugging President Trump in the Oval Office? While wearing a Make America Great Again hat, supposed symbol of white supremacy, Nazism, hate, evil?

(Screenshot from YouTube)

People flipped. Everyone did. Longtime critics suddenly — and bizarrely — embraced Kanye as an ally, while longtime defenders disowned him, abandoned him like nail clippings, often mocking his struggles with mental illness and labeling him, if you can believe it, a white supremacist.

Then, in a moment that changed music history, Kanye released the single "Ye vs. the People."

Ye vs. the People (starring TI as the People) www.youtube.com

In it, he challenges what he sees as the unspoken rule that black Americans have to vote Democrat. He had hinted at the idea on his track "Black Skinhead," from the hauntingly gorgeous album Yeezus, but now he was addressing it head-on, with the passion of a man going to Confession for the first time in a decade.

Why should black folks have to abide by any set of cultural or political or artistic guidelines to begin with? And, he argues, the pressure to adhere to this longheld framework is itself undergirded by a subtle and cleverly masked racism, imposed by a group of people who portray themselves as the champions of race and enemies of white supremacy and destroyers of dumb yokel rednecks with their Rebel flags and monster trucks and fully-automatic AR-15 assault weapons. All of which, it turns out, is some next-level projection.

Kanye also confronts the presence of these expectations and stereotypes in hip-hop. The idea that rappers must invoke a negative persona in order to succeed. And the moment they deviate from that image they are rebuked or ignored, even though the persona is damaging to the black community as a whole. Which is especially ironic given that the people who voice the most outrage tend to be highly privileged, supposedly progressive white folks who love to rant about white privilege and black oppression.

Is it better if I rap about crack? 'Cause it's cultural?
Or how about I'ma shoot you? or f**k your b***h?
Or how about all this Gucci, 'cause I'm f****n' rich?

Best of all, Kanye has answers. And they differ from the erudite solutions offered by, say, A Tribe Called Quest, who, like Kanye, have modeled a healthy, positive image of blackness for the black community.

A central theme within "Ye vs. The People" is empathy as power, rebellion, freedom.

Make America Great Again had a negative perception
I took it, wore it, rocked it, gave it a new direction
Added empathy, care and love and affection
And y'all simply questionin' my methods.

This concept is an extension of the powerful devotion to positive energy that Kanye adopted around that time, a purview he has cultivated into a wild new form of electronic gospel.

But his personal transformation was tough.

That [MAGA] hat stayed in my closet like 'bout a year and a half
Then one day I was like, "F**k it, I'ma do me"
I was in the sunken place and then I found the new me.

This is a struggle that many Americans undergo. Researchers call it the spiral of silence. The idea that the news media and social media present biased opinions as though they are fact, and when the message conflicts with a person's opinions or values, they feel isolated, alone.

Kanye and T.I. during the making of "Ye vs. the People"(Screenshot from YouTube)

As Kanye raps in "Ye vs. the People"

A lot of people agree with me but they're too scared to speak up.

Because we have an incredible ability to sense public opinion. So when we suspect that we hold a belief that rails against acceptable thought, we tend to keep quiet about it. That silence makes the opinion seem even more taboo, resulting in a more widespread silence.

In reality, many of these supposedly taboo opinions are not only popular, they are normal and practical and logical. Healthy, even. And the real danger is in demonizing them. But too many people are afraid they'll be ostracized for expressing their beliefs.

Like how — despite what we've been led to believe — most Americans cannot stand political correctness.

But the small minority of people who champion it are powerful and loud. They're like that cardboard city in North Korea, just visible enough from the border to make it seem like a thriving community. They're the Wicked Witch of the West, or Iago from Othello, or Plankton from Spongebob Squarepants.

So far, they have been successful. Although "success" by their metric is anarchic and primal, all destruction and loudness and people nervous to speak their mind. And the cost of rebellion can be devastating.

By the time Kanye West wrote "Yay versus the People," he had gotten sick of this power dynamic. So he broke the spiral of silence."

*

In the words of German philosopher Hans-Georg Gadamer, "Whoever has language has the world."

Humans alone have it.

But in order for us to know freedom in our world, our language has to be public, shared, active. Because each of us thrives constantly with language, a stream of it always in our mind. Aristotle defined "thought" as the infinite dialogue between the soul and itself. Conversation is the exchange of thought between people. When we converse, we simultaneously release our infinite dialogue and accept the other person's. By speaking, we shape the world and free ourselves.

*

Another way to say it is that Donald Trump might have inspired the song that could very well signify the end of Hip-Hop, which is not only the most popular genre of our zeitgeist, it's the most popular, and successful, form of music in American history, which is the most important era of musical history.

If the Beatles were bigger than Jesus, and Drake literally outpaces the Beatles, then, well, you get the point God forgive me. And Kanye is bigger than Drake. So who better to have the final word on the capacities of Hip-Hop than Kanye West?

Nobody.

Every genre must come to a close. There's a reason why people aren't eagerly awaiting the next great disco album, or flocking to arenas to hear the newest bluegrass superstar, or asking to get their hair done like the latest syringe-armed guitarist of Guns N Roses.

(Screenshot from Instagram)

The great era of Rock 'N' Roll ended roughly about the time Radiohead traded their guitars and drums for synthesizers and sequencers, not long after Kurt Cobain took an insane amount of heroin and cradled a shotgun in his guesthouse, only to be discovered several days later by an electrician. Even worse, Nickelback soiled Cobain's legacy with godawful anthems, and who have their own weird and contradictory and hilarious connection to President Trump.

These days, Rock N' Roll lives mostly via nostalgia, as evinced by the explosion of cover bands. Notice how you don't see any hip-hop cover bands. You will, someday. But, for now, Hip-Hop reigns supreme. And Kanye is the King.

The brilliant Nina Simone once told a reporter that "An artist's duty, as far as I'm concerned, is to reflect the times."

Because music accords itself to the gravity and creative truth of the era. And currently we entrust hip-hop with this complicated maneuver.

But the past year, Kanye has been crafting a new sound through his Sunday services, weekly jam sessions with acoustic musicians and a choir and everyone dressed in white, praying through song, herding us into a better place, looking above for guidance. If it's anything like his track "Ultralight Beam," it will bring calm to our divided culture.

Mark my words: The resultant album will usher in an entirely new era, a magical flash in human history.

So far, hip-hop has been the defiant child of R&B and Electronica, the grandchild of Spoken Word and Steve Reich Minimalism, with tinges of Punk. Not for much longer. Kanye will see to that. And, weirdly, President Trump has helped inspire this transformation.

Meaning, Donald Trump will have had a hand in reinventing music as a whole, in spreading a movement of positive reformation. Love him or hate him, it does not matter. What other politician can make that claim?

There's an optimism to this that Dave Chappelle captured in his now-infamous Saturday Night Live monologue, just days after Trump was elected, asking Americans to at least give the man a chance. And again in his special "Equanimity," when he said

I swear no matter how bad it gets, you're my countrymen, and I know for a fact that I'm determined to work shit out with y'all.

In a moment of now-tired irony, the usual suspects heaped a barrage of hate at Chappelle for these remarks. But their outrage does not matter, in the grand scheme of things. Because it is an incredible time to be alive. It's beautiful. We should never forget that, no matter how petty or outrageous daily life gets.

At the moment, we are a country that is — everywhere, secretly — hurting. But we are Americans. Together. This is America. And, every day, God delights in our greatness and our empathy and our endless gift for love. So open your heart and listen. Say what you need to say.

New installments of this series come out every Monday and Thursday. Check out my Twitter or email me at kryan@mercurystudios.com

Ryan: Michael Bennet, Little League

Photo by Sean Ryan

Every day, life getting shorter. Every day, life going faster. Every day, like a roller coaster. These were the kinds of things that Michael Bennet was saying.

Michael Bennet, God bless him, he seemed like a decent lad. All week he had his family there. He said his campaign was their family vacation. He had had prostate cancer but would you believe he survived?

"Life is getting shorter," he said. "Every day."

Photo by Sean Ryan

He was well spoken. Dry. Talked with an air of consultation. Like you were in his office, and he had things to tell you.

Like a Little League coach who could actually be a coach someday.

*

I would encounter Bennet again the next day, at the Iowa State Fair.

Having just seen Sen. Kamala Harris (D-Calif.) at a small Baptist church, we ventured to the fair to see Bernie Sanders' riot of a Sunday speech. Bennet was on before him, so I got there early, and I paced off to get a restroom break. The media center is in the basement of the administration building, right by the Political Soapbox stage.

For whatever reason, the first-floor men's restroom has giant windows along the wall, and you can see right out onto the walkway that wraps around the building. I did not realize that this was the path that the candidates take to get to the stage.

Photo by Sean Ryan

And, this far into the 2020 presidential election, they never went many places alone. They had a press swarm and their wives and maybe an old friend who relocated here when the hurricane sank his house.

I was rushing. Panicking, really. Because I heard all the commotion. But nature abides by its own pace. And as I shuffled to the sink to wash my hands, my pants fell all the way down. I was exposed. Out in the open and in such desperation, you clobber yourself outside of time. It was all slo-mo with the Chopped-n-screwed voices as I scrambled to lift my trousers and audibly gasped the words, "Well just no." At that exact moment, that "accidental Renaissance" painting occurred as I locked eyes with Michael Bennet, slowly maneuvering the walkway.

These sorts of things happened, didn't they? There you were in a restroom, at an NFL game or a concert or maybe a bar, and you see someone you work with, or someone from church or school, and you lock eyes for a moment in confusion then revert to cave talk and shrug and get on with what you were doing. But it's weird when only one of you is actively part of the etiquette and allowances of a restroom and one of you is held to a higher standard, for the sake of common decency. Now let's say that you, the restroom occupant, happen to be credentialed press, and the outsider, Michael Bennet, happens to be a candidate for president of America.

Once the herd passed by behind him, I laughed a bit, quietly, because life could be very funny.

*

Onstage, Bennet, a senator from Colorado, gave the performance of a cake falling into a pool. Like he had been ghost-busted. Like he had spent the last two months learning the Fortnite dance moves and now that he had mastered them, suddenly Fortnite was for losers, and Fortnite dances, well, they were even worse.

The Political Soapbox is great because every candidate has 20 minutes. Those 20 minutes were theirs. Most of the time, they got romantic like a Backstreet Boy singing up toward an open window. Occasionally, they lost it. Bennet did neither. He belly-flopped into hay bales.

Photo by Sean Ryan

Remember that the growing crowd had the dangerous feel of a natural disaster. And it was gaspingly warm that day. So neither the crowd nor the environment were ready to give Bennet a freebie.

He gave a ravishing speech, full of neat invective. Then looked up and realized he still had 14 minutes on the clock. Oof. That was most of it, and he'd already done the Floss and the Robot and the Electro Shuffle, and honestly his shoulder was a little stiff from all that dance practice. So he opened the floor for questions.

Now, that was not the greatest idea. For one, this was not the type of place for such a thing. They called it a soapbox because you were meant to live out the phrase "on a soapbox" by ranting and fist-pounding and all other theatrics.

The Bernie Sanders supporters hadn't arrived en masse yet, so most of the people around the stage were clad in Trump gear. And they all had their hands up ready to ask him questions. Well, firebombs, really, masked as interrogative statements. Bennet shouted without breathing, then said, "I want to find a non-male person who has a question."

This did not sit well with the males who did not like the trend of personalizing all things, cautious gendering, and the sudden change of direction so that now they had to just listen.

Most people did not care.

"I do not support Bernie's plan," Bennet shouted. But would you believe the Bernie supporters had literally just arrived, you could smell their hair dye.

They jeered, then acted exactly — and I mean exactly — like the Trump supporters.

"I would rather support free pre-school than free college," he shouted. "Many people talk about... " but the jeering was too powerful. And the Bernie supporters had likely just had quinoa açaí bowls at their pre-Bernie brunch, so they were unstoppable. Well God bless the man for scratching "Give Presidency a Try" off his bucket list. Because at least he had a bucket list.

What did they have? Student debt and a restraining order? They being the growing factions of Bernie and Trump supporters in the audience. You could not see any pavement. It was just people and faces like the Mediterranean in the evening, all the way to the towering walls of the Grandstand.

Looking out at all that chaos, all that latent disaster, Bennet must have felt a deep stirring.

The night before, Slipknot headlined at the Grand Stand, a sold-out show. Rollicking and bursting and howling. How many drumbeats could drummer Jay Weinberg get per minute? At one point, vocalist Corey Taylor unleashed a demonic bellow, then adjusted his mask and looked out to all those people, those devoted fans, because many of them had Slipknot tattoos, and maybe he, like Bennet, indulged a moment for himself, a personalization of the grand setting, then shrieked, then persuaded the audience to lift their hands into the air, maybe toward a constellation of their choosing, and extend their middle finger like it was an egg landing on a pillow, which symbolizes the human condition.




New installments to this series come out every Monday and Thursday morning. For live updates, check out my Twitter or email me at kryan@mercurystudios.com

Ryan: Donald Trump and Fox News troll the media

Sean Ryan

President Trump couldn't personally make it to Houston for the 3rd Democratic Debate, so he paid $7,500 for a single-engine Cessna to fly in circles over Texas Southern University campus while pulling a banner that said, "Socialism will kill Houston's economy! Vote Trump 2020!"

For four hours, it chugged around up there. You could hear it everywhere. It was the soundtrack of the night.

You can just imagine Trump's face as he had the banner-plane idea. You can hear him putting in the order. You can see his list of demands. And at the very top, "I WANT THE LOUDEST PLANE YOU CAN FIND!!!"

*

Was that Bret Baier in the aisle, adjusting his reading glasses and thumbing at the strap of his comically small backpack as he crossed the blue-carpeted gymnasium? He looked like the human version of Wisconsin. He was saying something but all you could hear was the plane overhead.

Photo by Kevin Ryan

Bret Baier, the stoic host of "Special Report with Bret Baier" on Fox News and the network's chief political anchor. He's underrated, if you ask me. Legacy. Old-school. He just delivers the news, which is what most people want. He talks the way anchors used to talk, with the American accent unique to news anchors even though he was born in New Jersey and raised in Georgia.

I had spent the last year-and-a-half on a series of in-depth profiles on some of the major countercultural figures of our time. People like Jordan Peterson, Dave Rubin, and Carol Swain. So my first impulse was to rush over to Baier and profile the guy. Nobody else would, after all. The New Yorker, The Atlantic, Harper's. But they ought to. The man has a hell of a story.
He joined Fox News a year-and-a-half after it was founded, as the southeast correspondent in Atlanta. A few years later, on a Tuesday in September, nineteen terrorists hijacked four passenger airliners and crashed into America.

When the first plane hit, Fox producers told Baier to just get in his car and drive to New York City. They needed back-up reporters for the next day. When the second plane crashed into the south tower of the World Trade Center at 9:03 a.m., they said, "Step on it, Baier."

He and his producer were an hour outside Atlanta when American Airlines Flight 77 slammed into the Pentagon. Still a good 8 hours away, but closer to D.C. than to New York City. So they re-routed to Arlington, Virginia, as fast as they could. Past a blur of fields full of indifferent cows. Past houses full of people who could hardly talk, people who couldn't describe what they were seeing and hearing, all the smoke and the blood and the office-supply confetti. Past towns that barely moved, gas stations with nobody in them, people sunken into a far-away stare.

Yet there was the sun, with only a few bangles of cloud every so often. America had been paralyzed but the earth kept trucking along, quiet and unbothered. It must have felt strange for Baier, to speed down empty highways — toward literal death and chaos — under a perfect sky, below cascading light and color.

Nature doesn't care if we make it out alive.

*

That day, Baier reported live from a Citgo station across the street from the Pentagon, rubble in heaps of flame behind him. It was like he'd fallen onto a different planet and was reporting back to home.

The next day arrived and it was so quiet everywhere. Nobody knew a damn thing. We could not believe our eyes. We all turned to reporters and anchors for answers. Most often, they blurted out whatever they could.

Something about Bret Baier gave audiences a much-needed boost. Reliable, sturdy. Like he said what had to be said and not a word extra.

Fox kept him in D.C., indefinitely. A friend helped him find an apartment. He never went back to Atlanta. Two weeks later, Fox News appointed him Pentagon correspondent, a position that saw him travel the world, including 13 trips to Afghanistan and 12 to Iraq.

Halfway through George W. Bush's second term, Baier became Fox News' White House correspondent.

Then, a year before he would earn his current position as anchor, Baier became a father. His son was born with holes in his heart — five congenital heart defects. Twelve days later, the boy underwent open-heart surgery. Baier and his wife waited in tiled rooms drenched with flowers and ESPN and drab ultraviolet light, surrounded by machines full of beeps and whirring and beeps and whirring.

Baier's son has since undergone two additional open-heart surgeries, nine angioplasties, and one stomach operation. In an interview with Parents Magazine, Baier said that his son's health problems have "given me perspective about my job, going through policy and politics in Washington, D.C., to see the bigger picture."

*Part of the reason I couldn't tell whether or not it was Baier is he's usually up on the main stage. For the 2012 election, he moderated five Republican debates, and co-anchored FNC's America's Election HQ alongside Megyn Kelly.

The 2016 election would propel him into a much larger role. He anchored three Republican debates, but this time he had to handle Donald Trump.

Baier knew Trump personally, from before the election. They'd played golf together. He described Trump as "a nice guy outside of his TV persona" and never thought Trump would actually make a run for the Presidency. Onstage, Trump was much different. And Baier had been tasked with maintaining control.

A devout Roman Catholic, he appreciates a nice glass of wine and a fine cut of steak. He likes a good joke, too. In January, 2019, Baier signed a multi-year deal with Fox News to continue "Special Report." A few weeks later, he and his family went to Montana for a ski trip. The weekend was wonderful. But they had to get back to New York because Baier was scheduled to appear on "The Late Show with Stephen Colbert" that Tuesday.

Imagine him, again in a car hurtling toward a fateful destination. How he squinted through the frost-pocked windshield and gripped the steering wheel. As he guided the white SUV along the two-lane road to the airport. The land looked haunted, barren, lifeless. Everywhere, the world was frozen white. Snow and ice blanketing the fields, gauze over the sky.

At some anonymous intersection, Baier pumped the brakes, but the tires hit an ice patch, and the SUV spun loose. An oncoming car slammed into the driver's side, launching the vehicle into an embankment, wedged on its side. A man named Zach stopped his pickup truck and helped the family crawl free, and the Montana Highway Patrol rushed them to the hospital.

"Don't take anything for granted," Baier tweeted later. "Every day is a blessing and family is everything. It's always good to remind yourself of that before something does it for you."

Before every debate that he moderates, Baier spends 10 minutes alone, praying.

*

A Freedom of Information Act request in 2011 revealed that Fox News was actually right. That the Obama Administration really did hate them. And had intentionally excluded them from a press pool two years earlier. Then laughed about it.

The documents unearthed snarky emails between various high-ranking aides in the Obama Administration. In one, the Deputy White House communications director bemoaned Baier's reporting on the bias. "I'm putting some dead fish in the [Fox News] cubby — just cause Bret Baier is a lunatic." That same day, deputy press secretary Josh Earnest bragged in an email that "we've demonstrated our willingness and ability to exclude Fox News from significant interviews."

The Trump administration pulled a similar stunt in July, 2018 by banning a CNN reporter from the press pool. Trump and Fox News had developed a beneficial relationship by then. And CNN was a lifelong competitor, a public enemy.
That night, Baier delivered an official statement, "This decision to bar a member of the press is retaliatory in nature and not indicative of an open and free press. We demand better. As a member of the White House press pool, Fox stands firmly with CNN on this issue of access."

Fox News rebuked Trump in solidarity with CNN. It was a heartening gesture between two seeming enemies. Fox News were standing up for truth, defending journalism, rejecting tyranny even though the ban would have benefitted them as a company.

Who knows how many books and dissertations and articles have been written about Fox News, usually in relation to bias, usually with a scathing tone. The conclusions differ wildly, yet each one claims certitude.

Generally, academics and journalists have taken a doomsday tone when talking about Fox News. Accusations of evil, fear-mongering, bigotry, hatred, misinformation, propaganda, racism, homophobia, and so on.

Despite these outcries, Fox News has consistently held its spot as the most-watched network in the country. Imagine how that makes its critics feel.

In an August 3, 2018 appearance on Jimmy Kimmel Live, Baier said, "the biggest problem is that the people who are most critical of Fox are usually people who have not watched Fox News."

Fox News is composed of two distinct departments. Punditry and straight news. Or "opinion news" and "descriptive news." Consistently, surveys of the public rate Fox News as both the least- and most-biased news network.
Last year, a survey found Fox News to be the second most-trusted television news brand in the country, after the BBC.

In a separate study, Democrats rated its bias score at (negative) -87, while Republicans placed it at (positive) +3. Which is like if, at a football game, one referee said "Touchdown," while the other referee said "Turnover, leading to Touchdown for the Defense." It can't be both, can it?

Public opinion may not be the best metric for understanding Fox News, especially in 2019.

Quantitative studies have offered clearer conclusions. In 2016, a content analysis used crowdsourcing and machine learning to examine over 800,000 news stories published over a year by 15 major outlets, from the New York Times to Fox News. They wanted to chart media bias.

What they discovered is that news outlets are far more similar than we believe. Much of the perceived bias is a matter of separating "opinion news" from "descriptive news." For conservatives, it's punditry. For those on the left, it's op-eds and long form investigative pieces, although the left tends to insist that they're not biased, that they are instead just more apt to tell the truth, even though research has disproven this belief.

The researchers found a much larger bias-divide in opinion news, whereas descriptive news was practically neutral. One of the researchers described Fox News' descriptive news as "guided by similar news values as more traditional, legacy media."

University of California Berkeley sociologist Arlie Russell Hochschild wrote that "Fox News stands next to industry, state government, church, and the regular media as an extra pillar of political culture all its own."

Say what you want about Fox News, they play a crucial role in the so-called mainstream media. And, despite what Fox News will lead you to believe, they are definitely part of the mainstream. And they are by no means the innocent victim. And certainly not powerless. And they have all kinds of problems that I will not defend. But we'll talk about that in a later installment, the one about Kamala Harris at a gun control rally, advocating for propaganda.

*

After two months of political events, I suspected that different news networks have their own signifiers, like the distinct stripes and markings on various spiders.

Wall Street Journal reporters tended to carry old-timey notepads and interview any bystander they could find. Breitbart usually only sent one person, and he wandered around with his iPhone, recording every single thing. Politico, prim-suited men who could just as easily work on the stock market.

Most of the reporters dressed like that, in stagey business attire. Prim for a high school job fair. Meanwhile, the photographers, mostly men, looked like professional paintball players. The camera crews and technical staff were the only ones decked in tattoos and wearing sandals and generally not caring about the chaos all around them. On-camera talent were covered in makeup and shrink-wrapped into dresses or suits with chip-clips along the spine.

The Washington Post sent the classiest and most bored-looking people I have ever encountered. They never looked at their laptops as their fingers chopped at the keys, and you assumed they were pretending until you read their stories online. You could spot ABC because their camera crew wore faded red ABC hats. Associated Press looked like they had just come back from a battlefield assignment in Syria, and never donned the same press credentials as everyone else, preferring a tattered AP lanyard. And you always knew when someone was with the New York Times because they announced it to the entire room.

And Fox News? At democratic events, they usually hid. But not that day, in Houston, as Bret Baier walked up the aisle to a table a couple rows in front of me.

Most people arrived in the Media Filing Center several hours before the debate. Fox News got there just slightly after that, as everyone was wiggling in their seats and connecting their laptops to a shared outlet.

There were seven or so in the pack of Fox News, all grinning. They all had white to-go sacks from Chick-fil-A. And the room got quieter, so Trump's plane got louder. It was a double trolling event.

As host of the debate, ABC would be providing dinner. This information was included in the credentials email that all of us had received. So nobody else had brought food with them. No need.

Even better, I was familiar enough with that part of Houston to know that there was not a Chick-fil-A anywhere close to us. Who knew where they'd gotten that Chick-fil-A, but odds are it wasn't warm. Who knew if there was even any food in the bags.

They had brought Chick-fil-A into a building full of national media during the third Democratic Presidential debate. The 2020 election was already full of outrage about plenty of things, and one of them was Chick-fil-A. To some folks, the red chicken logo might as well have been a swastika. That very week LGBT activists had vehemently — cartoonishly — protested the opening of several Chick-fil-A's throughout North America. Chicken sandwiches had become yet another flag on the tug-of-war rope in the Culture War of our country.

To be clear, the political left was anti-Chicken and the political right was pro-Chicken. The media tended to lean anti-Chicken, and frequently wrote about anti-Chicken causes, often scolding pro-Chicken voices, or ignoring the struggles of the pro-Chicken community only to deny any opinion on Chicken at all. That was the cowardly part, of you ask me, the pretending like they weren't activists.

The Democratic candidates definitely leaned anti-Chicken. Sometimes they took it so far that it upset moderate anti-Chicken advocates. Because was it really so bad to eat Chicken? Couldn't you be anti-Chicken but also enjoy Chicken occasionally? Why did everything have to be either "all Chicken all the time unless you hate freedom" or "no chicken ever unless you support hate"?

The fight had spread everywhere. Airports, stadiums, malls, campuses. All had served as battlegrounds for the anti-Chicken versus the pro-Chicken.

The previous President was anti-Chicken. In fact, he may well have enflamed the entire movement. During his tenure, there were nationwide protests that saw pro-Chicken advocates angrily and proudly eating Chicken while anti-Chicken advocates protested outside and occasionally engaged in homosexual affection, which was being threatened by Chicken, according to them.

Every time the pro-Chicken folks bit into a Chicken sandwich, it was like they were gnawing away at the anti-Chicken people themselves. Degrading their identity. Because, for them, it was about the identity.

But the current President, unabashedly proud of his pro-Chicken stance, once served Chicken at the White House to some winning sports team, and the anti-Chicken activists saw it as proof that Chicken and hate go together. And maybe Chicken would even lead to the impeachment of the President they hate, which would mean the Vice President would become the President, but he's one of the most pro-Chicken people in America, so they'd have to impeach him, too. And the Supreme Court, it was overrun with pro-Chicken types.

This election, the Democratic front-runners competed for the bolder plan. They would end Chicken in America once and for all. They would obliterate our evil President and his Chicken Supremacy. Their stump speeches relied on harsh criticisms of pro-Chicken voters, who pretended to find the whole anti-Chicken movement amusing but were secretly enraged by it. In fact, they were certain that the anti-Chicken movement had been systematically silencing them for years, and that they had to fight for their Chicken in order to keep everything that they valued, even all the not-Chicken.

The media and the democrats and Hollywood and academia — all hated the Chicken, because they hated the pro-Chicken people. If they had their way, no more Chicken, ever again. And no more pro-Chicken deplorables. And tonight the anti-Chicken politico-culture complex would prove it, with long rants which get confirmed by glowing articles, calculated takedowns about the merits of anti-Chicken and the evils of pro-Chicken.

Yet here was Fox News, with actual Chicken. And they were smiling. Maybe in part because the police who were guarding us all tended to be pro-Chicken. And this was Texas, after all, an incredibly pro-Chicken state. But there were 49 other states and 14 territories, and all of them were fighting for or against Chicken.

Some experts even said we were on the cusp of a Civil War.


New installments to this series come out every Monday and Thursday morning. For live updates, check out my Twitter or email me at kryan@mercurystudios.com