Moral Collapse / Corruption Rewards the Worst and Penalizes the Best

This is Essay #4 in the series Truth Be Told.

Moral Collapse / Corruption are not abstractions. Rewarding the worst (those with zero scruples / moral foundation) and penalizing the best (those with high ethical standards) generates self-reinforcing feedback that dooms the system to disintegration: the worst prosper so mightily that they gain control of the system while the best are exploited / marginalized, reduced to Tax Donkeys or indentured laborers serving the worst.

A society and culture that has lost its moral compass loses more than its principles and soul--it loses everything that underpins a functional society and economy, including social cohesion, shared purpose, civility, trust in leaders, institutions, the judicial system and in the fairness (a.k.a. a level playing field) of the entire system, and critically, the belief that honesty and hard work will be rewarded rather than exploited / looted.

Moral Collapse / Corruption consumes all these foundations as the systemic cost of incentivizing self-enrichment to the exclusion of all else. Every component of society's moral foundation is hollowed out by the artifices of The Big Con, which claims to embody all the revered principles it grinds to dust in its relentless drive to accumulate private wealth and power by any means available.

Every source of authentic value is debased for personal gain as empty cliches--increasing shareholder value--are deployed to mask the monopolizing of power to reward the most corrupt at the expense of those powerless to limit the looting of the worst, who encounter no limits on their corruption in a culture and economy in which everyone has their price.

This Moral Collapse / Corruption is self-reinforcing, as those with any shred of ethics either quit / opt out or are fired / sent to digital Siberia, leaving only those in charge who see everything as an opportunity for self-enrichment, regardless of the consequences to others or the system as a whole.

In their pathological narcissism, they see the system as a bottomless feeding trough for their personal aggrandizement, oblivious to the causal results of everyone with a place at the trough gorging themselves: the system collapses.

This corruptive frenzy for unearned money has infected the entire spectrum of American society, rich and poor and everyone in between. From fake disability claims to fake invoices, every form of fraud flourishes in America. This raises four important points:

1. At the lower levels of the social-economic order, there are still some limits on fraud and corruption. Despite the immense resources devoted to evading oversight and audits, fraudsters and embezzlers are occasionally caught and convicted.

2. There are no limits on the super-wealthy, as they don't need to commit fraud to increase their wealth; they just rewrite the rules to suit themselves with their wealth. $100 million is nothing to billionaires, but it buys the entire political-judicial power of the state.

3. This scale of wealth bypasses the need for the consent of the governed, which is why I call America's current status quo Privatized Totalitarianism: the super-wealthy dictate what's legal to suit their desire for "more"--more wealth, more power.

As correspondent Simons Chase so insightfully put it, "what's moral is what's legal, and what's legal is for sale." These eleven words summarize America's terminal corruption.

4. In this terminal stage of moral collapse and Privatized Totalitarianism, passing more laws will not reverse the unraveling of the moral foundations needed to sustain a functional society and economy. Chapter 57 of the Tao Te Ching describes the core dynamics in play:

The more restrictions and limitations there are,
The more impoverished men will be.
The more arms men possess,
The more disordered the country will be.
The more scheming and deceitful men are,
The more strange things will occur.
The more rules and precepts are enforced,
The more bandits and crooks will be produced.

(Translation by my philosophy professor Chang Chung-yuan)

And Chapter 38: (my free-form version)

When the Tao is lost, we have attainment (optimization).
When attainment is lost, we have benevolence (superficial-phony virtue-signaling).
When benevolence is lost, we have righteousness (political correctness / ideological rigidity).
When righteousness is lost, we have rules (propriety for show).
Rules are the dry husk of loyalty and trust, the beginning of chaos.

In this free-for-all frenzy of fraud and self-enrichment, the best opt out and disappear into the woodwork, stripping the system of any talent other than self-enrichment and Big-Con / Ultra-Processed Life artifice. Self-enrichment and artifice are self-liquidating, for once they consume whatever can be looted, there's no foundation left to support a functional society and economy.

This moral collapse includes an intellectual collapse, as "liberty," "democracy," "innovation," etc., are reduced to parodies of their original substance by the artifices of The Big Con PR. Every statistic is gamed, every market manipulated, every principle debauched, and every bit of adaptative vigor is throttled to maintain a grip on power.

This excerpt from The Fall of the Roman Empire by Michael Grant crystalizes the present moment in American history with remarkable aptness:

"There was no room at all, in these ways of thinking, for the novel, apocalyptic situation which had now arisen, a situation which needed solutions as radical as itself. His whole attitude is a complacent acceptance of things as they are, without a single new idea.

This acceptance was accompanied by greatly excessive optimism about the present and future. Even when the end was only sixty years away, and the Empire was already crumbling fast, Rutilius continued to address the spirit of Rome with the same supreme assurance.

This blind adherence to the ideas of the past ranks high among the principal causes of the downfall of Rome. If you were sufficiently lulled by these traditional fictions, there was no call to take any practical first-aid measures at all."

And so as the worst apply Band-Aids to the metastasizing cancers as "solutions" (AI! Stablecoins! Bases on the Moon!), we stand on the beach as the tsunami of consequences of rewarding the worst and punishing the best races toward us.

In this moment, the future no longer seems real, and in the incoherence of the present, the radical action needed to change the outcome seems impossible. If we cannot run, perhaps we can still walk toward higher ground, leaving footprints in the damp sand few will follow.

---

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The Hidden Looting by the Rich leads to the Physical Looting by Those Who've Been Looted

This is Essay #3 in the series Truth Be Told.

That The Hidden Looting by the Rich leads to the Physical Looting by Those Who've Been Looted is so obvious that it is strictly taboo in the polite circles of those tasked with protecting The Hidden Looting by the Rich behind the cliches of "market forces" and the many carefully obscured mechanisms of state subsidies, tax giveaways, insider trading, market manipulation, and so on.

An astute reader summarized the dynamic succinctly: "Looting by the rich is hidden, silent, not criminalized while the physical looting by the poor is overt, thunderous and criminal."

Note that "the market" doesn't dictate what is legal and what is criminalized; the state dictates what is legal and what is criminal. This establishes the second truth which is taboo in the status quo:

"The Market" and the State are one system. Every claim that these are separate is self-serving misdirection / artifice. Consider the difference between what happens when Average Citizen contacts their state representative or a regulatory agency, and what happens when Tech Bro Billionaire contacts their state representative or a regulatory agency with an offer to fund $10 million of campaign contributions if various regulations and tax codes are amended.

The truth is "the state" is a "market" for corruption and self-service in which the "market" is hidden from view: The auction that dictates what's legal and what's criminal is won by the highest bidders, who are of course the wealthiest and most powerful few, who then dictate state policies that expand and protect their wealth and power by looting the powerless many.

French economist Frederic Bastiat famously described this dynamic of "market" and "state" generating legal plunder, i.e. legal looting. Once the purchase of state power for the purposes of self-enrichment becomes normalized--what I term moral decay leading to moral collapse--it becomes more profitable to pursue legalized looting than actually create authentic value.

This is why we see extreme wealth-power inequality increasing while the quality of goods and services plummets. There are no "rewards" for the richest few to risk capital by increasing the quality of goods and services when political influence is both cheap and risk-free: just "buy" a tax break or subsidy or regulations that protects your lavish state contracts from competition and expands the power of your monopoly / cartel.

The reason why this dynamic of legalized looting by the rich expands until it breaks the status quo is that it is self-reinforcing. Those who aren't delighted to further enrich the moneylenders in the temple with their labor quit in disgust, while those with zero scruples and limitless greed devote every waking hour to enriching the most avaricious few for their share of the loot.

Politicians who don't kiss the ring of Tech Bro Billionaires to raise millions of dollars in campaign contributions lose elections, as once again those with any shred of integrity self-select out of the political / "market" cesspool.

As Bastiat put it, the status quo boils down to "That Which Is Seen, and That Which Is Not Seen". What's seen is an endless spew of paeans to the glories of "the market," scrappy innovators creating new products in garages that generate billions in wealth, blah-blah-blah, or paeans to the glories of the state protecting us from the evils of exploitation, blah-blah-blah, all of which is the necessary cover story to cloak the market-state system of legalized looting by the rich and the criminalization of any blowback by those being looted.

We're being looted in so many ways that are not seen until the scales fall from our eyes. Billionaires manage to exploit tax shelters intended for the middle class to protect millions of dollars in gains from any taxes. Inflation in goods and services that is gutting the bottom 90% doesn't affect the wealthy, as they spend an inconsequential share of their wealth and income on essential goods and services.

As in any conflict staged for show, "the market" is glorified as the saint and "the state" is demonized--or on other stages, the roles are reversed. Neither staging reflects the truth: there is only one system, and the only possible output of this morality-free system of self-enrichment is the terminal expansion of looting until the system breaks down.

This--

leads to this:



Legal looting by the rich--who have eliminated both the moral foundations of society and avenues of Redress as impediments to the ceaseless expansion of their wealth and power--leads to uncontrollable looting by those who have been looted--Retribution. I address all these dynamics in my book Investing In Revolution. If you can find another book that explains everything I explain, by all means buy that book. But there is no other such book to my knowledge.

---

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America Is Already Great; Its Leadership Class Is Not

This is Essay #2 in the series Truth Be Told.

I generally avoid juggling lit sticks of dynamite, i.e. addressing MAGA (Make America Great Again), but this juncture in history obligates me to make a few points now, despite the risks of outrage.

1. America and its hard-working people are already great, and never stopped being great. They don't need to be "made great again."

2. America's self-serving Leadership Class--those in power--has failed the nation and its people. By Leadership Class I mean the class of people who have authority / power in every sector of the economy and society, not just in the political realm but in academia, what passes for America's intelligentsia, technology, corporate America, energy, media, finance, banking, foreign policy, manufacturing, defense--every sector.

This class has mastered the artifice of pantomiming leadership, not real leadership, to cloak their sole real goal, which is self-enrichment and the consolidation of their personal wealth and power. This pantomime of leadership is what I term The Big Con, which boils down to this:

Telling us what we want to hear--the con man's core technique--so they can stripmine us without restraint.

What we want to hear are cliches of restoring greatness lost to the corruption and greed of our Leadership Class and a grab-bag of other sappy, hollow cliches--I feel your pain, Hope and Change, peace with honor, innovation, increasing shareholder value and so on, an endless spew of phony PR slogans designed to con us into thinking their self-serving actions are actual leadership rather than artifices of self-enrichment cloaked in PR finery.

These hokey cliches are hyped by $100 million campaigns funded by the rich and powerful cronies of the self-serving Leadership Class to make sure they stay in power so they can make the rich and powerful even richer and more powerful, all at the expense of hard-working Americans who are losing ground every day.

Consider one example among many: how many leaders in academia devoted their prodigious intelligence and energy to slashing their institution's bloated bureaucracies that contribute nothing to actual learning to reduce the cost of attending their university by 50%?

The answer: none. Higher Education leaders feasted on the hundreds of billions of dollars of "free money" funded by student loans, a modern-day version of indentured servitude, funding lavish buildings and other fripperies, padding their own already-stupendous paychecks and pensions, "investing" in PR about the value of their education rather than actually making sure their students learned anything of actual value.

This pantomime of leadership--The Big Con--masking the zealous pursuit of self-enrichment is visible in every nook and cranny of America. The pantomime--self-glorifying theatrics, overblown visions of techno-paradise, threadbare cliches reworked in a hundred ways to distract and lull the populace--is now so pathetically obvious and absurdly excessive that it's a self-parody, a comic book version of leadership.

Real leaders demand sacrifices of the rich and powerful to serve the national interest and the shared interests of the citizenry. Real leaders don't stage an elaborate pantomime of leadership to cloak their self-enrichment and their ceaseless efforts to further enrich their campaign contributors / cronies.

The moral rot of America's Leadership Class has now reached a self-reinforcing terminal spiral. The rot started two generations ago, and has now reached the point where the corruption, avarice and the stripmining of the populace are not even recognized for what they really are, they're now just BAU--business as usual.

Foreign policy is now guided not by national interest but by what I call The Imperial Project, which boils down to expanding the power and profits of America's monopolies and cartels.

The leadership of Corporate America gutted the nation's manufacturing sector over the past 30 years to boost their own private wealth and the private wealth of their biggest shareholders. Corporate America is run by greedy lemmings--with apologies to real lemmings--who slavishly jump on every trend no matter how destructive and nonsensical.

Way back in 2000, on my first flight to China, I sat next to a senior employee of a top-tier semiconductor equipment company, who recounted his CEO's lemming-like insistence on shipping production to Asia, resulting in a flood of defects that cost far more to fix than the supposed gains. The corporate lemmings all jumped on the offshoring bandwagon regardless of its impracticality and many obvious downsides.

And now all the corporate lemmings have jumped on the equally flawed AI bandwagon, guaranteeing a horrific host of dire consequences await all of us chained to the idiocracy of our Leadership Class.

As noted previously, it's painful to admit we've been conned. The con man knows this, and is a master of misdirection and phony excuses. But unlike these forked-tongue artifices, the consequences are real: beneath the gamed statistics and parody-level theatrics--AI!--we're going to Mars!--our economy and society are in shambles.

So what can we do? For a start, stop voting for people who collect $100 million from the wealthiest and most powerful stripminers and spend it on the The Big Con. Start voting for the handful of real leaders who refuse to accept more than $100 from any person or entity, who refuse to sell their souls to the highest bidder.

I just completed a 5,200 mile camping trip through much of America, and it's worth repeating what I observed everywhere: Truth be Told, America and its hard-working people are already great, and never stopped being great. They don't need to be "made great again." It's America's hopelessly corrupt leadership class that needs to be cashiered en masse and replaced by real leaders who aren't vying to sell their souls to the highest bidder.

Yeah, I know--this will never happen. Don't be too sure that moral decay and corruption have no consequences, and that The Revolution No One Sees Coming isn't just off-stage.

---

New collection of five intriguing stories: Jumble Bin Stories (Kindle $6, print $12) read samples for free (PDF)

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Truth Be Told

The ultimate truth is revealing the truth of the situation and our feelings about it are a relief, and the starting point to moving forward in a positive direction.

This is the first in a series of posts around the theme of Truth Be Told, a theme that demands some interpretative explication / context.

There is a spectrum of ways to tell the truth. There's the angry rant ("I'm mad as hell and I'm not gonna take this any more!"), the tearful confession, the accusatory diatribe ("you can't take the truth!"), the dispassionate accounting of facts and evidence, and many variations that combine the human emotions these express.

My series is built around a special form of Truth Be Told, the kind only a true friend can tell us. It's human nature to hide truths that hurt, and it's human nature to lie to ourselves to maintain a front that all is well and whatever's crumbling can be shored up by our belief that everything is still as it's always been.

The acquaintance responds to our doubts and fears with superficial encouragement: you'll get through this, it's just a rough patch, every relationship / enterprise goes through these low spots, you just need a weekend off to regain your perspective, and so on--well meant but not the truth.

Only a true friend will risk telling us the truth, knowing it will be painful and that we will likely respond poorly, defensively at best and lashing out attacking the friend at the worst. The true friend accepts the responsibility reluctantly, torn between the desire not to hurt us and the knowledge that the only way out of our misery is to finally face the truth, mourn what is no longer what it once was and accept the truth of what we feel beneath what we've been telling ourselves to keep going.

A true friend is not passing judgement, they speak the truth with sympathy for our plight, sympathy for the suffering of living a lie, however attractive the lie may be, fully aware of the pain we're experiencing as the gulf between what we tell ourselves and what we truly feel widens to the breaking point.

The truth is the most personal, consequential truths are often painful because accepting them means the end of something we wanted and cherished, the end of an era and the acceptance of an uncertain, perilous future. I use the examples of relationships and enterprises, because these are life's most demanding commitments. To end a relationship or close an enterprise is difficult on multiple levels, and the true friend knows this from their own experiences.

The path of least resistance is to maintain the facade of a happy marriage and successful enterprise, even as living a lie eats away at us. It's often a shock that someone else sees through the facade and discerns the truth within us.

The true friend must make a difficult calculus, as truth be told risks the friendship for a highly uncertain gain. The true friend is aware that sometimes we're not ready to confront the truth, and the precipice has to crumble beneath our feet before we're ready to accept the truths behind the facade.

Or we're finally at a point where hearing the truth from a trusted friend who has our best interests at heart unleashes a great relief, for the truth is not just pain, it's also relief. A true friend is more likely to expose the truth by asking us questions rather than making statements. Our answers to questions such as "when was the last time you had an honest heart-to-heart with your partner?" reveal the truth we've avoided.

I anticipate angering many readers in this series, because deeply held mythologies will be bulldozed. In a very real way, the facades we cling to to maintain relationships and enterprises are personal mythologies, and their collapse generally spawns an emotional tornado.

The ultimate truth is revealing the truth of the situation and our feelings about it are a relief, and the starting point to moving forward in a positive direction. To share a series around Truth Be Told makes me feel like the guy in a bedraggled white robe on the street corner, murmuring about redemption while passersby cross the street to avoid me.

So be it. I'm just asking questions, and the truth is revealed by your answers and your emotional reactions.

---

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What's the Point of AI, Anyway?

The point of AI is profit, dependence and dominance cloaked with Happy Story Hoopla about super-abundance. We have a super-abundance already--of malicious mayhem and cognitive impairment.

AI is by most accounts either 1) the greatest advance since the wheel, or at least since YouTube and/or 2) the greatest opportunity ever to skim billions or maybe even trillions of dollars in private gains. A third possibility--that AI will generate a destructive tsunami of Anti-Progress unique in human history, catalyzing the deepest, most destructive Global Depression since the Great Depression 97 years ago--was not in the running a few laps ago but is now neck-and-neck with the favorites.

This raises a question worth answering: What's the Point of AI, Anyway? Is it:

1) just the latest in a string of over-hyped technologies whose primary purpose is enriching those who get there the firstest with the mostest, i.e. secure the trillion-dollar gains of a network-effect monopoly, or

2) really going to usher in the greatest advances in human history, freeing all of humankind from drudgery, illness and taxes? or

3) actually going to usher in an AI-enabled, centralized, surveillance-extraction-control dystopia of serfs rendered helpless by their dependence on AI?

There are many opinions, but are there any conclusions that withstand scrutiny? I say yes, there are. Let's start with the 42 essays I've written over the past two years on AI and add recent links from other sources.

Conclusion #1: AI isn't actually intelligent, but that doesn't mean it's not ideal for sowing highly profitable malicious mayhem. There's Just One Problem: AI Isn't Intelligent, and That's a Systemic Risk. (8/8/24) AI is ideally suited for hacking, ransomware, breaking into secure systems, leaping over guardrails, mimicking trusted identities, malicious deep-fakes, surveillance, and much more: the sky's the limit on AI's proclivities for malicious mayhem.

As my short story The Peculiar Death of Mr. Garcia, illustrates, AI's mayhem already extends beyond the conceptual reach of our current legal system.

Conclusion #2: since AI has no moral foundation or understanding of the real world, it's ideal for sowing highly profitable malicious mayhem. AI has no moral guardrails, despite over-hyped claims, or indeed, any guardrails, as guardrails are rationally understood by AI to be impediments to "earning rewards" for completing tasks. So to complete tasks, AI must circumvent guardrails.

"Rogue AI Agents" Aren't Rogue, They're Fulfilling Their Functional Goal: Automating Sociopathology (8/19/26)

Conclusion #3: all the over-hyped wonders AI is supposed to be creating are a trickle while highly profitable malicious mayhem is scaling up at light-speed. Lest you think this is an exaggeration, consider these links:

Trust Was This Week's Vulnerability. (easydns.com)

Every story below is a variation on the same move: borrow a trusted identity, then cash it in before anyone checks.

Operators open contact on WhatsApp or Telegram posing as someone the target already knows, spend days building rapport, then send a file disguised as Norton Antivirus, Adobe Flash, KeePass, Telegram, or an AI tool like Pictory or RunwayML. One lure was a fake MRI scan showing a disc herniation. Once running, it harvests contacts, email, and social messages, captures the screen, and switches on the microphone.

The FBI's advisory notes that some victims' personal information later surfaced on pro-Iranian leak sites. The design is the whole point: the approach happens on a trusted platform, from a familiar-seeming contact, over enough time that the eventual file doesn't read as an attack. If you or someone you know does work that makes you a plausible target--journalism, activism, dissent--a friendly contact who takes days to build rapport before finally sending something to open is worth verifying through a separate channel, no matter how convincing the conversation has been.

Why AI Malware (and Harmful Second Order Effects) Are Out of Control (3/26/26)

What AI Is and Is Not-- or, When Electrocution of Innocents Becomes Profitable (6/17/26) June 17, 2026

Forget the AI Slowdown--the Vulnerability Explosion Is Already Happening: AI labs are toying with an industry-wide pact to slow development. Meanwhile, widely available AI chatbots are already helping uncover a tidal wave of security flaws. (wired.com)

If the AI Industry Followed Its Own Research, It Might Have Paused Already: Anthropic's CEO says that safety hinges on understanding how AI 'thinks.' So far the evidence is disturbing. (wired.com)

Conclusion #4: The full systemic costs, utility and productivity of AI cannot be determined as long as AI chatbots, agents, search and tools are heavily subsidized to goal-seek network effect dominance, and the costs of defending against the rising tide of AI-enabled security threats are soaring so fast they cannot be determined.

Without Subsidies, AI Is Unaffordable (8/8/26)

Wall Street Thinks AI Is Getting Cheaper. It's Missing The $430 Billion Security Bill. (zerohedge.com)

The token price is only one part of the cost of an AI workflow. J.P. Morgan estimates that AI could create more than $430 billion of additional security spending over three years. Cheaper intelligence can create more machine activity, and more demand for trust. For security vendors, the trust bill is revenue. For companies deploying AI, it is cost.

Falling token prices should improve AI economics, but the total cost of an AI task also includes identity, security, monitoring, governance and compliance. Some of the savings created at the model layer may simply move somewhere else in the software stack.

This does not mean security costs erase the benefits of AI. It means token deflation is not the same thing as total AI-cost deflation. The better metric may be cost per trusted AI task, not price per token.

Conclusion #5: it's already abundantly clear that only those who already know how to think, write and research for themselves can avoid becoming dependent on AI to the degree that they are incapable of developing / learning how to think, write and research for themselves, and are therefore cognitively impaired for life.

I explain this in depth here: Automating Our Dependence Will Cripple Us (4/9/26)

An M.I.T. Report Warns A.I. Is Causing 'Cognitive Surrender.' Universities Are in a Bind. The worries that artificial intelligence is degrading education have been building for months. Students are using it for everything, including cheating, and a recent report out of M.I.T. said it is triggering 'cognitive surrender.' (nytimes.com)

Should the Classroom Be More Like the Gym? As A.I. presses harder on the academic enterprise, we might look to a place where process is its own reward. (newyorker.com)

Conclusion #6: the implosion of the AI "investment" bubble will trigger the implosion of the global financial house of cards that's been propping up the global economy. An all-or-nothing bet has already been placed on AI generating trillions of dollars in revenues (and profits) while the sector struggles to generate billions while bleeding billions in losses chasing the chimera of network-effect dominance.

The Inevitability of the AI Depression (4/3/26)

The AI Depression (3/24/26)

AI slowdown calls justified but collapse of bubble may be more immediate threat. (theguardian.com)

Conclusion #7: no one is going to save us. We're on our own.

Washington Won't Be Regulating AI Anytime Soon: Even with mounting concerns about AI models going rogue, legislation appears unlikely, and the White House is outright opposed to oversight.

Our A.I. Problem: Why can't the people who produced the technology, which has already shown that a different world is possible, just do the things that would prevent extinction?

Because they're too busy trying to secure billions of dollars in their private accounts, that's why. They're busy automating sociopathologies, but there's no need to automate greed--it's already super-abundant.

Conclusion #8: the entire premise of "technological innovation drives Progress" is that new technologies serve the public. AI takes "to serve humans" in the Twilight-Zone context of consuming us to benefit AI's owners and centralized overlords.

Conclusion #9: the only effective countermeasure is Cold Turkey--don't get dependent on AI, which means avoiding using it in the first place. Anatomy of AI Cold Turkey. (10/27/26)

The point of AI is profit, dependence and dominance cloaked with Happy Story Hoopla about super-abundance. We have a super-abundance already--of malicious mayhem and cognitive impairment. If you use AI, treat it like plutonium, as that's a reasonably useful analog.

---

New collection of five intriguing stories: Jumble Bin Stories (Kindle $6, print $12) read samples for free (PDF)

My book Investing In Revolution is available ($18 for the paperback, $24 for the hardcover and $8.95 for the ebook edition). Introduction (free)


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