Armstrong economics Blog/War Re-Posted Aug 19, 2021 by Martin Armstrong
Now that the Afghan government has fallen, I believe I am free to talk about what I do know. I met with the government on neutral ground in Thailand. I was invited to give lectures there but just never found the time to make that trip. As I have said before, most governments have heard of Socrates. After all, it has been putting out economic and geopolitical forecasts since 1977. From my discussions with them in Thailand, what I can say is that the Taliban are largely self-funded, yet have been warmly protected by Pakistan which is the ONLY nuclear nation in that region. Pakistan has supported the Taliban, not for religious agreement, but because of their enemy, the Afghans, we friends with Pakistan’s enemy India. In that sense, there is a deep-seated religious conflict that goes back to the creation of Pakistan in 1947.
The peak in our model on the region took place in 2019 when any hope of some sort of peace treaty with the Taliban collapsed. Military operations between Afghan and US government forces and the Taliban then intensified in 2019 resulting in more than 8,000 civilian casualties. That was precisely on target being 72 years from 1947 which was the real period of the rise in militant Islam. A standard 2-year reaction was in play which has brought us to this point in 2021. But this is the start of a 13-year cycle of rising tensions which will also peak in 2032.
Pakistan is aligned with China and the idea has been that China will invest in Afghanistan and that may help to satisfy the Taliban. But that is perhaps wishful thinking. Religiously, they are more akin to Iran. Nevertheless, the Taliban has been a movement of religious students (talib) from the Pashtun areas of eastern and southern Afghanistan. They were actually educated in traditional Islamic schools in Pakistan. Keep in mind that Pakistan can be very authoritarian. Pakistan is blocking cell phones to compel people to be vaccinated.
The Taliban control the largest opium production in the world and have been the #1 exporter. This has been their primary source of funding. Back in 2000, they were against drugs. But they needed the support of the farmers and flipped their ethical view that they were exporting opium to the enemy so that made it ethical.
Some believe that they were also bribing some public officials to look the other way. For most of the last 20 years, the Taliban have been in the drug trade. However, that has not been their own source of funds. They also get money from mining, real estate, and unnamed regional benefactors who lead back to Iran. Nevertheless, the Taliban is a well-funded organization, and they are primarily a self-sustaining group that can be sustained domestically. They have imposed their own tax regime known as ‘ushr,’ which is a 10% tax on income and 2.5% wealth tax.
Believe it or not, the Taliban have stolen weapons that were given to the army and police forces by the United States. Some believe they bribed people for that access. They have stormed the government offices and arrested officials and killed many. They have stormed the prisons, releasing everyone, and seized all the American weapons provided to the government. However, sources were also saying that the Taliban were also getting weapons “donated” to them from Iran with its proxy war against the United States. Additionally, there were claims that weapons were also being smuggled in from Russia via Tajikistan.
Biden’s performance and the inability of the Biden Administration to manage a bubblegum machine is what our models have been warning. The West has used COVID to try to change the economy, but this Great Reset actually destroying jobs and small businesses (middle class) while favoring the big elite companies, which is why Big Tech supports the Great Reset. The problem with this stupid move has been that this is precisely what you DO NOT do. The US Civil War was won by the north because it was the industrial backbone. The south was getting funding from adversaries, but they were predominantly just agrarian. The victor belongs to the stronger economy.
Rome fell during the 3rd century BECAUSE its economy was weakened. Once the emperor Valerian I (253-260 AD) was captured by the Persians in 260 AD, this signaled to all the Barbarian tribes in the north that Rome was vulnerable. They began an assault that even forced Rome to build a defensive wall around the city when Aurelian (270-275 AD) came to power in 270 AD. Within just 10 years of Valerian’s capture, Rome itself was vulnerable to the invasion of Germanic tribes.
Anyone who has been to Rome will see the spectacular Aurelian Wall that still stands to this day. It is a reminder of what happens when an empire becomes weak from within. That is when it is time to invade. You would think that this should be a lesson taught to world leaders. Oh, I forgot. There are no classes on how to be a world leader. There are no professional requirements to run a country. That is our real problem.
The capture of Valerian in 260 AD also led to the separatist movement where Britain, Gaul (France), and Spain broke from the Roman Empire and began the Gallic Empire with their own Emperor Postumus. Here is a silver coin of Postumus and we can see the propaganda. The reverse clearly read that he is the restorer of Gaul. He would not have issued such a coin and the Western part of Europe would not have split from Rome unless they saw that Rome was incapable of defending them or managing anything.
History WARNS that this drive to change the economy has weakened the economies of the West and has left Europe especially defenseless. NATO has become a joke. Annegret Kramp-Karrenbauer has succeeded Ursula von der Leyen, who was elected as the new head of the European Commission. So Ursula von der Leyen, who was also a board member of the World Economic Forum, was in charge of the defense of Germany and now she is the head of the EU. She has no qualifications for either position. The West is all about diversity and symbolize — not qualification.