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Self Assured Destruction

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Epsilon Theory PDF Download (paid subscription required): Self Assured Destruction In the 1960s, our Cold War strategy evolved into Mutual Assured Destruction, a dangerous but stable relationship with the Soviet Union. In 2020, our Covid-19 War strategy devolved into Self Assured Destruction, a dangerous and utterly unstable relationship with the SARS-CoV-2 virus. As the story goes, a few weeks after JFK was inaugurated in January 1961, his new Secretary of Defense – Robert McNamara – was briefed by the head of Strategic Air Command on US nuclear warfare strategy. Under the “Massive Retaliation” doctrine of the day, there were two options: go and no-go. Any provocation by the Soviet Union sufficient to trigger a go action would result in the immediate launch

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Epsilon Theory PDF Download (paid subscription required): Self Assured Destruction


Self Assured Destruction

In the 1960s, our Cold War strategy evolved into Mutual Assured Destruction, a dangerous but stable relationship with the Soviet Union.


In 2020, our Covid-19 War strategy devolved into Self Assured Destruction, a dangerous and utterly unstable relationship with the SARS-CoV-2 virus.


As the story goes, a few weeks after JFK was inaugurated in January 1961, his new Secretary of Defense – Robert McNamara – was briefed by the head of Strategic Air Command on US nuclear warfare strategy. Under the “Massive Retaliation” doctrine of the day, there were two options: go and no-go. Any provocation by the Soviet Union sufficient to trigger a go action would result in the immediate launch of all US nuclear warheads – about 1,500 at the time – against 650 targets, mostly in the Soviet Union, but also anywhere in the world where SAC thought the Russians had military assets. As McNamara remembered General Power (yes, that was his real name) telling him, “I sure hope you don’t have any relatives in Albania, Mr. Secretary, because we’re going to have to wipe them off the face of the earth, too.”

At the end of the presentation, the oh-so-pleased-with-themselves generals asked McNamara what he thought. His angry response:

You don’t have a war strategy. You have a war spasm.

Same thing today.

We don’t have a Covid-19 strategy. We have a Covid-19 spasm.

We launched all of our warheads against ourselves in a massive overkill of a lockdown, where our domestic equivalent of a noncombatant Albania was hit just as hard as our domestic equivalent of a Soviet missile base, and now we’re done. Our arsenal is gone. There will never be another coordinated national effort to control the spread of Covid-19. Not with this President, at least.

But that’s the problem with spasmatic policy and the blowhard leaders who administer it. You end up with neither a war-preventing strategy nor a war-fighting strategy. You end up neither containing the enemy nor defeating the enemy.

First, you ignore the initial small provocations and the warning signs of trouble because you’re not prepared with actions you can take short of all-out war. At first you minimize and you excuse.

Sound familiar?

Self Assured Destruction

Then, when you finally respond, you act in an incredibly heavy-handed, all-or-nothing fashion that inflicts maximum damage on both the true war-fighting targets AND targets that have nothing to do with the fight at hand.

Sound familiar?

Self Assured Destruction

Finally, if your spasmatic attack fails to wipe out the enemy – if the enemy retains an offensive attack capacity after your all-or-nothing effort – then your population is held hostage by the enemy’s threat. You have no choice but to surrender and hope for a merciful/lucky outcome.

Sound familiar?

Self Assured Destruction

Our leaders have botched this war, and we are defenseless against a still potent and now endemic enemy, left only with the deus ex machina hope of a truly effective vaccine.

Here, let me say that again.

Covid-19 is now endemic in the United States.

That means it is everywhere. That means it is something to live with rather than something to eliminate. That means Covid-19 is now being “handled” as a chronic disease rather than an acute infectious emergency, a chronic disease where – every day while it remains endemic – 15,000 to 20,000 Americans will get so miserably sick that they will seek treatment and be officially diagnosed, and 500 to 1,000 Americans will die.

15,000 to 20,000 Americans really sick. 500 to 1,000 Americans dead.

Every day.

By the way, these numbers would be a significant improvement over the numbers today. Over the past two weeks, the United States has averaged 22,089 newly diagnosed cases of Covid-19 and 1,118 deaths per day, even as cases and deaths from New York have dropped more than 80% from their peak (New York now adds about 1,200 new cases and 100 deaths per day). Frankly, I think 15,000 to 20,000 Americans officially sick and 500 to 1,000 Americans officially dead every day is a pretty optimistic scenario for an endemic Covid-19 in the months ahead.

Other countries, allies even, countries like South Korea, Taiwan, Japan and Germany, have waged their war against the virus much more effectively than the United States, so that a nationally coordinated policy of testing and contact tracing to manage an endemic virus without suffering ruinous daily casualties is at least possible.

We don’t have that possibility. We have botched this war so miserably that the only solution to an endemic Covid-19 available to the United States is a vaccine. Other systemically crucial countries, like Russia, Brazil and India, are in exactly the same boat. We’ve all followed a strategy of Self Assured Destruction.

And so we wait. We wait to see if we get an effective vaccine by the end of the year. If we do, then maybe we win the war, despite our absurd strategy and incompetent leadership. Maybe. If we don’t, then we lose.

By win, I’m not saying that our markets or our politics go back to “normal”, whatever that means. I’m saying that our markets and our politics can survive if there’s a viable vaccine developed in the next six months. I’m saying that the “bridge loan” narrative driving trillions of dollars in economic support for corporations and some measly fraction of that for unemployed workers can only work if there is a similarly-functioning domestic economy on the other side of this bridge.

But if it’s a bridge to nowhere …

If there’s no vaccine in the near future …

If Covid-19 persists as an endemic disease where 15,000 to 20,000 Americans get really sick and 500 to 1,000 Americans die every freakin’ day for a couple of freakin’ years, and where the situation is worse – MUCH worse – in countries like Brazil and Russia and India and Indonesia and Iran and Egypt and Mexico …

The free world does not easily survive a globally endemic Covid-19.


Self Assured Destruction

[first lines]

Newsreader:    Day 1,000 of the Siege of Seattle.

Newsreader:    The Muslim community demands an end to the Army’s occupation of mosques.

Newsreader:    The Homeland Security bill is ratified. After eight years, British borders will remain closed. The deportation of illegal immigrants will continue. Good morning.

— Children of Men (2006)

After the global flu pandemic of 2008, mankind loses its ability to conceive children, and the world begins a long, gradual descent into anarchy and despair. By 2027, Britain is the one civilized nation remaining, although it has transformed itself into a brutal police state to manage not just a fin de siècle, but a fin to … humanity.


That’s the premise of Children of Men, a great book by PD James and an even better movie by Alfonso Cuaron. It’s a premise that’s ringing pretty loud in my ears right now.

And I don’t know how to make the ringing stop.

See, I’ve been writing this note for the better part of a month now, unwilling to take my thoughts to their logical conclusion. And maybe we WILL get lucky. Maybe we WILL develop a truly effective vaccine in the next few months. I really do have faith in our technological prowess. Because I have to.

But here’s the problem with that faith. Whether or not there really is an effective vaccine, we will be TOLD that there is an effective vaccine. Our government policies and our personal behaviors will go forward over the next year AS IF there is an effective vaccine. The overwhelming narrative from both Wall Street and Washington will always be that an effective vaccine is “in advanced tests” or “showing great promise” or “ramping up production” or “available now for emergency personnel”. Maybe this will be true. God, I hope it will be true. But we won’t KNOW if it’s true … we won’t KNOW if there’s an effective vaccine for billions of human beings … until, what, Q3 of 2021?

If it’s NOT true, if there is not in fact a vaccine that can eliminate Covid-19 as a globally endemic illness, then I think we’re in a full-bore Children of Men scenario. All capital markets become political utilities in this future. Only national champion corporations remain, and the line between State and Oligarchy becomes nonexistent. Democracy? LOL.

The form of social organization that “works” with 15,000 to 20,000 Americans getting really sick and 500 to 1,000 Americans dying every freakin’ day for a couple of freakin’ years, combined with massive political instability and violence abroad, is national socialism with American characteristics. It’s a fetishization of the State and its provision of order, such that all economic and political behavior is funneled exclusively through the State and its crony capitalist “Yay, military!” and “Yay, stock market!” narratives. It’s smiley-face fascism. And not-so smiley-face fascism.

But even if it IS true, even if there is in fact a vaccine that can eliminate Covid-19 as a globally endemic illness, what happens during the months-long period between the announcement of this effective vaccine and its broad distribution? There will still be 15,000 – 20,000 Americans getting really sick and 500 – 1,000 Americans dying every day from this now preventable disease! What would your political response be if your mother or your husband or your brother died from Covid-19 because your government administered this vaccine to someone else first? There will be tens of thousands of such deaths in the United States, and hundreds of thousands of such deaths around the world. Will you accept a loved one’s death under these circumstances with equanimity, comforted by your faith that the Trump II or Biden I administration did everything possible to distribute this life-saving treatment with justice and fairness to all?

Or will you rage?

Self Assured Destruction

Forget about the United States for a minute. Let’s say you live in India. Do you trust the Modi government to administer whatever vaccine stock they acquire with justice and fairness? Will you shrug your shoulders if your town or state is passed over and your brother dies? How do you think the Modi regime will respond to your righteous anger? Will they say “oops, our bad” and make amends?

Or will they find someone to blame?

Now do Brazil. Now do Egypt. Now do Mexico. Now do Indonesia. Now do Iran. Now do Russia. Now do China. Now do the United States.

Maybe these regimes will blame you for their mistakes and unjust actions. Maybe these regimes will blame the Muslims or the Jews or the Uighurs or the communists or the imperialists or the Republicans or the Democrats or the immigrants or the “thugs”. Maybe these regimes will blame China. Maybe these regimes will blame the United States. One thing’s for sure, they won’t be blaming themselves.

I’m having a hard time seeing how we get from here (globally endemic Covid-19, incompetent and/or pseudo-fascist leaders in the most powerful countries on earth) to there (a non-outright burning, non-outright fascist world) even if we get a truly effective vaccine into production by the end of the year.

I’m having a hard time seeing how we get from here to there because I know how incompetent and/or pseudo-fascist leaders ALWAYS respond to this sort of domestic unrest and threat to the maintenance of their incompetent and/or pseudo-fascist regimes.

They start a war.

Not an allegorical “war” against a virus, but a real war against an Other. Sometimes that Other is a group or region inside their country. Sometimes that Other is another country. But it’s ALWAYS a war.

There are two ways to read the title of this note: Self Assured Destruction.

One way is how I led off the piece, as a play on Mutual Assured Destruction, as the consequence of having a war spasm rather than a war strategy, as an assured destruction brought down on yourself.

The other way to read it is as the self-assured destruction that incompetent and/or pseudo-fascist regimes visit upon their human enemies in real war, as they confidently propagandize and violently blame another country or group for their own failings.

The first interpretation is in the past. We can’t change the abysmal way in which our government and so many other governments have waged this “war” against Covid-19. We can’t do anything about that now.

The second interpretation, though, that’s in the future. And yes, we CAN do something about the tragic way in which our government and so many other governments will try to lead us down the path of real-world war.

Back in 1997, I wrote a book called Getting To War, about how all governments – democracies and dictatorships alike, in the 20th century or any other century – attempt to mobilize public opinion before taking on a risky action like starting a war. The book’s long out of print (although you can read big chunks of it on Amazon for free if you’re so inclined), but it’s time to dust off that 30-year old methodology and use the modern technology of the Narrative Machine to identify getting-to-war propaganda in today’s major powers.

Thirty years ago, I had no ability to do this narrative research in real-time, and no megaphone to communicate my findings to the world. Today I’ve got both.

Next up … Part 2 of this note – not Self Assured Destruction, but Self-Assured Destruction – where I’ll walk you through the getting-to-war process that all governments use to create a war-supporting narrative, how we can use the Narrative Machine technology to track this process, and what we can do to jam or subvert those war-supporting narratives. If you haven’t yet read the Epsilon Theory note Inception, now would be a good time to do that.

Act I of the Covid-19 War is over. The high-functioning sociopaths who have used us as fodder and feed for decades were caught unawares by this new enemy, and they thoroughly bungled the response of State and Oligarchy. Now the pleasant skins of “Yay, Democracy!” and “Yay, Capitalism!” – false narratives, not the real thing – have been ripped off to reveal the naked sinews of power beneath.

Act II will be the story of high-functioning sociopaths trying to re-establish their system of control through narratives of Other-blaming and war … and how we beat them at their own narrative game.

As for Act III … we’re going to change the world, you know. You and me.


Epsilon Theory PDF Download (paid subscription required): Self Assured Destruction


About Ben Hunt
Ben Hunt
He is the chief investment strategist at Salient, a $14 billion asset manager based in Houston and San Francisco, and the author of Epsilon Theory, a newsletter and website that examines markets through the lenses of game theory and history. Over 100,000 professional investors and allocators read Epsilon Theory for its fresh perspective into market dynamics.

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