American Meltdown: Book Two of The Economic Collapse Chronicles

by Goodwin, Mark

  "Fine!" Howe conceded. "I'll call Klauser."

  Al Mohammad continued, "Make sure you start out with a very sincere apology. I'll let you get to work."

  "OK," Howe said.

  "A simple thank you would be in order, Mr. President," Al Mohammad said.

  "Thank you, Mr. Al Mohammad," Howe said. He bit his tongue to keep his anger in check. Howe was seething. He knew Al Mohammad was probably right about apologizing to Klauser, but the way he held it over him, the way he had just scolded him like a child, the way he was blackmailing him to keep a noose around his neck, he could not tolerate. It was time to start shopping around for someone who could find a permanent solution to this problem with Mustafa.

  Howe poured himself a stiff drink as he came to terms with what he had to do. He had to lay his pride down for just a moment and make the call. This is something he never had to do, until Mustafa came along. Howe had grown up as a child of absolute privilege. His father’s financial firm was among the largest in the world. All through school, college and all through life, everyone respected Howe. Even his teachers and professors were careful about the way they spoke to Anthony Howe. When he had done things against the law as a youth, the police and judges knew better than to prosecute him.

  Howe refreshed his drink and made the call. "Mr. Director, I just want to start by saying how sorry I am for the way things were said yesterday."

  "The way things were said, is not the problem, Mr. Howe. Your defiant, aggressive tone that you spoke to me with, that is the problem. Would you like to apologize for that?" Klauser was making him grovel.

  "Yes sir, I apologize," Howe responded.

  "For what, Mr. President?" Klauser asked.

  "I apologize for the aggressive and defiant tone with which I spoke to you yesterday, Mr. Director," Howe choked out.

  "I do not accept your apology, Mr. Howe," Klauser began, "but in the interest of the global economy, we’ll do what we can. I am not negotiating with you, Mr. Howe. I am going to lay out the terms by which the IMF will agree to aid the United States.

  “First I will clarify the terms where we left off yesterday. The US will cut spending by 50% from current levels. When I say spending, I am referring to necessary government activities such as military and programs that your citizens have paid into such as Medicare and Social Security. I am not referring to wealth transfer payments to your citizens who have not paid anything into the system. Those programs are to be cut by 75%. I would recommend starting some type of a triage operation to find out who the truly disabled and needy are as this money will not go far; particularly in the hyperinflationary environment that is about to overtake your country.

  “Our previous arrangement which we had discussed loosely was that the IMF would seize 90% of all deposits over $50,000 dollars from US banks. This is no longer possible as the entirety of all US banks have lost their liquidity in this present derivatives debacle. Fortunately, the FDIC limits were not reduced from $75,000 to $50,000. We will have the FDIC payout the insured amount to the depositor’s accounts. From there, the IMF will assess a bail-in tax of 90% of the deposits over $5,000. All depositors with $5,000 or less in the bank will not be affected by the bail-in tax. I think that represents the majority of your citizens as your government has never encouraged them to save, so this should not be as politically dire as you may think. Those with more than $5,000 will keep the first $5,000 and 10% of the amount over $5,000. I doubt most of the ones with more than $5,000 in the bank were your constituency anyway."

  Howe thought this must be Klauser’s way of being gracious. It probably made Stanley Klauser feel magnanimous, but it rubbed Howe the wrong way. Howe sat and listened as he poured himself yet another drink.

  Klauser continued, "China has agreed to purchase your excess military equipment for 25 cents on the dollar, which I think is very generous. What is more, they have agreed to pay in gold."

  "Mr. Director," Howe interrupted, "I humbly apologize for interrupting, but it will be difficult for me to get the congress to agree to give up military equipment which has top secret technology to the Chinese."

  "You'll find a way, Howe. America’s days of being a superpower are over. Your country is going to have to come to terms with reality. The reality is, if you want this assistance to stabilize your currency and prevent the death of most of your citizens, you will have to agree to all of these terms exactly as they have been presented.

  “The remaining gold reserves in the US will be held by the IMF as collateral until all loans made in SDRs are repaid in SDRs with interest at the prevailing rate. Currently, that rate is 19%."

  SDR stood for Special Drawing Rights. SDRs were the currency of the IMF. It was a completely fiat currency just as all the other currencies on the globe. The value of each SDR was determined by a basket of currencies of all the member countries, in proportion to their economies. The IMF loaned money in SDRs as opposed to the currency of the debtor country to keep them from devaluing the loan by printing excessive funds.

  "The IMF will lend the money to keep the US Government operating at the spending level we discussed for six months. Payments will be made each month to your treasury after a monthly approval process by the Council of Member States. You must be found to be in compliance with the terms of the agreement each month or the monthly payment will not be credited to your treasury's account. If your country descends into a civil war or fragments into more than one state claiming authority, the IMF will be unable to help you until the domestic issues are solved. We will overlook those issues until the end of April, but on the first of May, you must have these issues with seceding states resolved. The IMF retains the right to alter this agreement as it sees fit and when necessary to protect the vested interest of member countries.

  “You may announce this agreement to your citizens tomorrow morning." Klauser hung up the phone without so much as a "goodbye" or "have a nice day."

  Immediately after the call, Alec Renzi walked timidly into the room. It was obvious that Howe was livid.

  "Sir," Renzi began, "the mob has breached the fence on the White House lawn. Secret Service recommends that you evacuate the remainder of the staff."

  Howe stood up. He still had authority over this situation, and he intended to use it. "Tell Secret Service to have the Marines to fire on anyone who breaches the fence. All of the remaining staff are in the subterranean bunker. They are safer there than anywhere else."

  Renzi responded, "Yes, sir, but they could be trapped there for days."

  Howe yelled, "I said leave them there!"

  CHAPTER 15

  "Remember that it is the actions, and not the commission, that make the officer, and that there is more expected from him, than the title."

  -George Washington

  It was cold outside. After the animals were tended to and the firewood was cut and stored, Matt Bair had little else to do in the way of chores on his new homestead. He and Karen generally went over to Adam's house after lunch. It was only a couple of miles away if they walked through the woods rather than taking the road, so they usually walked to get the exercise. Karen and Matt typically tried to get back home before dark. This got them home before the frigid night air made walking outside unbearable. It also served to ensure they would not wear out their welcome at Adam's. Miss Mae, the cat, tended to get a bit destructive when left home alone for too long as well. Tearing paper or scratching up the couch was her way of protesting when she felt ignored.

  When they arrived at Adam's, everyone was right where they left them the evening before. They were watching the crisis unfold on television. Matt and Karen found a seat together on the couch and turned their attention to the drama du jour.

  Patrick James of CNC was reporting from the White House fence.

  "People are climbing the fence onto the White House lawn. We have not received official word, but we’re sure the President is not there. Marine One was seen leaving yesterday, and we assume the President and most of his staff were on b
oard.

  Press Secretary Jared Campbell gave the press briefing last night that did little more than stonewall the press on the crisis. That briefing was done in the White House Press Room last night. It was after we saw Marine One lift off, so we assume that Campbell is still in the White House."

  POP....POP, POP...POP. Gunfire rang out from the White House lawn. Patrick James dropped down on his stomach. James had climbed the ranks at CNC by never thinking twice about accepting risky assignments. He had been in harm's way on a regular basis throughout his media career. This had boosted his status with the network and taught him to always be aware of the situation. The cameraman and the others stationed with Patrick James followed his lead and got down behind the CNC van. Patrick crawled over to the cameraman and continued reporting.

  "Gunfire has broken out on the White House lawn. We don’t know who is firing, but we’ll try to move to a safe location and keep filming as long as possible," James reported.

  James and the cameraman low crawled to the back of the van where they could see the White House Lawn. Several civilians were lying motionless on the lawn. The Marines guarding the White House were yelling indiscernibly between themselves. Four of the Marines were stripping off their Battle Dress Uniform shirts and walking away from the White House. Several others were yelling at them and two of the Marines were leveling their M-4 rifles at the Marines who were walking away.

  Patrick James began to comment on what he was seeing. "It appears the Marines fired on the protestors who breeched the fence. I can't say at this time whether any of those protestors were armed or not.

  Four Marines appear to be abandoning their post after the shootout. They have taken off their jackets bearing the Marines insignia. They seem to be checking on the victims of the firefight. They may be checking for weapons, but it looks like they are assisting the victims or checking for a pulse. The Marines still at their posts have rifles trained on the four that are walking away, but are not firing.”

  Matt and the others watched intently as the four Marines moved from body to body.

  Patrick James continued, “They are now approaching the fence.”

  Matt squeezed Karen’s hand as he continued to watch the live action scene on the television.

  The Marines jumped the White House lawn fence, faced the crowd and held up their right hands with only their three center fingers extended and their thumb and pinky fingers crossed over their palms. They yelled, "Oath Keepers," as they held up their hands. The crowd of protestors cheered for the four men.

  Matt looked at Adam. "Is that the Boy Scout pledge sign they just made?"

  Wesley interjected before Adam had a chance to answer. "It’s also the sign people made in the Hunger Games movies to show solidarity."

  Adam answered, "It may stem from either or both of those things, but it has been adopted by the Three Percenters. The first American Revolution was started by only three percent of the population at the time. The three fingers represent The Three Percent. They are a different group from Oath Keepers, but I suppose these four guys are identifying with both groups. The philosophy of the two groups are not that far apart."

  Shelly asked, "I saw some bumper stickers at church with the roman numeral three followed by the percent sign. Is that the insignia of the Three Percenters?"

  "That's them," Adam replied. "From what I hear, Oath Keepers across America are ready to go absent without leave. They are just waiting to see which of the states will secede so they know if they will be leaving or not. They also need to know which states will back the movement so they know where to go. These four guys may have just pulled the trigger on that plan. I think they are calling it Operation AWOL."

  "AWOL is short for absent without leave?" Janice asked.

  "You got it," Adam said.

  CHAPTER 16

  "If Congress can employ money indefinitely to the general welfare, and are the sole and supreme judges of the general welfare, they may take the care of religion into their own hands; they may appoint teachers in every State, county and parish and pay them out of their public treasury; they may take into their own hands the education of children, establishing in like manner schools throughout the Union; they may assume the provision of the poor; they may undertake the regulation of all roads other than post-roads; in short, everything, from the highest object of state legislation down to the most minute object of police, would be thrown under the power of Congress.... Were the power of Congress to be established in the latitude contended for, it would subvert the very foundations, and transmute the very nature of the limited Government established by the people of America."

  - James Madison

  Anthony Howe paced around in circles while he tried to get the video room at Mount Weather to look less like a bunker.

  "This isn't going to work,” Howe chided. "Can't you people set up a green screen in here and just cut and paste me in front of the fireplace of the Oval Office?"

  Howe was furious. He regretted not having Jared Campbell here. This was his job. He should be the one telling these idiots what to do.

  The woman who was handling the filming of the President's speech made a suggestion. "Mr. President, may I recommend that we drop a maroon crushed velvet drape over this wall and flank you with the flag of The United States and the Flag with your official seal? We have a nice wood desk where you can be seated. While it won't be the Oval Office, it will certainly look presidential."

  "Okay," Howe grunted. "But get this mocked up to look like the White House by tomorrow. Bring furniture from there or whatever you have to do. It's only 40 miles away. It shouldn't take an act of Congress to get some authentic furnishings in here."

  Howe went into the boardroom to meet with Bleecher and Chang. He started speaking as he sat down. "Ladies, I am going to tell the American people that the banks will be open on Monday. Will the two of you be able to make sure that goes smoothly?"

  Jane Bleecher spoke first. "Mr. President, the Fed can produce the funds, but I expect the people to withdraw every dime they can get. I would recommend restricting withdraws to $500 per week. That will likely deplete most of the physical bills in the vaults in a couple of weeks."

  "We can do that, but I am giving them enough bad news today. I'll let them figure out the weekly limitation on Monday when they get to the bank.” Howe turned his attention to Chang. “Can we reopen the markets on Monday?"

  "I don't think you should, Mr. President," Melinda Chang said. "I think it would be a blood bath of selling."

  "Then when do we reopen them?" Howe asked.

  Chang scribbled nervously in her note book on the table before she replied. "I would wait until we can come up with a plan to restore confidence."

  "How do you propose we do that?" Howe asked.

  Bleecher answered, "We need a new stimulus program that will inject funds directly to the people to spend."

  Howe shot down the idea. "Hyperinflation has already set in. Pumping money into the system at this point will just make the currency completely worthless. We are getting reports that people aren't accepting dollars in individually-owned grocery stores as it is. Paul Randall's barter system idea is already creeping into grocers and gas stations."

  Chang recommended, "Maybe we need to let the smoke clear and come up with a revalued currency. Perhaps we could back it with a basket of commodities. Then it would have a fixed value, based on the aggregate value of the commodities."

  "That would be admitting Paul Randall was right," Howe rebutted. "We would lose all control to that maniac. I'll watch this country burn to the ground before I admit he was right about backing the dollar with silver and gold."

  Bleecher proposed an alternative idea. "What if we began paying government employees and government benefits in ration tickets? The government could easily commandeer needed commodities such as food and fuel under the National Defense Resources Preparedness Executive Order 13603. This would turn the ration tickets into a de facto commodity-backed currency without na
ming it as such."

  Howe perked up. "That's right. Mustafa signed Executive Order 13603 in his first term. It was the National Defense Resources Preparedness Act. It allows the government to seize resources in times of emergency. Jane, I think you are on to something."

  Melinda Chang jumped right on the bandwagon. It was obvious to Howe that she was trying to prove her value to him. She said, "The ration ticket would likely start to trade as a currency for other goods and services. We would maintain some control over these transactions as we would be issuing the de facto currency. At least it would keep the consumer market attached to the government. That’s more influence than we have in the barter networks Paul Randall is advocating."

  Howe was actually smiling. "Good work ladies. Get this all ironed out and come up with a proposed timeline. Consider the full power of the US military at your disposal for implementing this plan."

  As they left, Howe realized he was going to be in absolute control now. That is what he really wanted. The people would have to accept it. They could fall in line or starve to death.

  Anthony Howe walked the short distance down to the video room from where he was to give his address to the American people. He was walking a bit lighter than just an hour before.