Last week I wrote about a new film, Collapse, and the arrival of Peak Oil as one of the primary factors driving that collapse.   Two years ago, daring to speculate about the end of America, or of capitalism itself would have been greeted with a hearty guffaw, or at least some very skeptical glances.  Today, these concerns are no longer solely the province of the “doomers”– there is a blossoming awareness of the gravity of the challenges facing us.  Consider these warnings from mainstream, highly credible sources:

• Secretary of State Hillary Clinton argues that our debt and unprecedented deficits have become a national security issue, not merely a matter of economics. Reuters reported:
  

  Having to rely on foreign creditors hit “our ability to protect our security, to manage difficult problems and to show the leadership that we deserve,” she said.

  “The moment of reckoning cannot be put off forever,” she said. “I really honestly wish I could turn the clock back.”

  Though she did not mention it, China’s portfolio of some $755 billion in U.S. Treasury bonds has become a concern for some U.S. policymakers. They worry that Beijing’s creditor status could create leverage to influence U.S. policy.

• Ben Bernanke, Chairman of the Federal Reserve bluntly warned that the US is facing a debt crisis similar to that facing Greece.  From the Washington Times:
  

  “It’s not something that is 10 years away. It affects the markets currently,” he told the House Financial Services Committee. “It is possible that bond markets will become worried about the sustainability [of yearly deficits over $1 trillion], and we may find ourselves facing higher interest rates even today.”…

  “We’re not going to monetize the debt,” Mr. Bernanke declared flatly, stressing that Congress needs to start making plans to bring down the deficit to avoid such a dangerous dilemma for the Fed.

  “It is very, very important for Congress and administration to come to some kind of program, some kind of plan that will credibly show how the United States government is going to bring itself back to a sustainable position.”

• Niall Ferguson, a historian and professor at both Harvard University and Harvard Business School, offered a terrifying opinion piece in the LA Times warning of the sudden collapse of the American empire.

If empires are complex systems that sooner or later succumb to sudden and catastrophic malfunctions, what are the implications for the United States today? First, debating the stages of decline may be a waste of time — it is a precipitous and unexpected fall that should most concern policymakers and citizens. Second, most imperial falls are associated with fiscal crises. Alarm bells should therefore be ringing very loudly indeed as the United States contemplates a deficit for 2010 of more than $1.5 trillion — about 11% of GDP, the biggest since World War II.

These numbers are bad, but in the realm of political entities, the role of perception is just as crucial. In imperial crises, it is not the material underpinnings of power that really matter but expectations about future power. The fiscal numbers cited above cannot erode U.S. strength on their own, but they can work to weaken a long-assumed faith in the United States’ ability to weather any crisis.

One day, a seemingly random piece of bad news — perhaps a negative report by a rating agency — will make the headlines during an otherwise quiet news cycle. Suddenly, it will be not just a few policy wonks who worry about the sustainability of U.S. fiscal policy but the public at large, not to mention investors abroad. It is this shift that is crucial: A complex adaptive system is in big trouble when its component parts lose faith in its viability.

Over the last three years, the complex system of the global economy flipped from boom to bust — all because a bunch of Americans started to default on their subprime mortgages, thereby blowing huge holes in the business models of thousands of highly leveraged financial institutions. The next phase of the current crisis may begin when the public begins to reassess the credibility of the radical monetary and fiscal steps that were taken in response.

Neither interest rates at zero nor fiscal stimulus can achieve a sustainable recovery if people in the United States and abroad collectively decide, overnight, that such measures will ultimately lead to much higher inflation rates or outright default. Bond yields can shoot up if expectations change about future government solvency, intensifying an already bad fiscal crisis by driving up the cost of interest payments on new debt. Just ask Greece.

Ask Russia too. Fighting a losing battle in the mountains of the Hindu Kush has long been a harbinger of imperial fall. What happened 20 years ago is a reminder that empires do not in fact appear, rise, reign, decline and fall according to some recurrent and predictable life cycle. It is historians who retrospectively portray the process of imperial dissolution as slow-acting. Rather, empires behave like all complex adaptive systems. They function in apparent equilibrium for some unknowable period. And then, quite abruptly, they collapse.

Washington, you have been warned.

• Charlie Munger, Warren Buffett’s less-well-known partner, wrote a parable for Slate last week.  It warned of troubles to come for a country known as “Basicland” (a thinly-disguised proxy for the U.S.).  One of the primary drivers of these troubles in Basicland is the “shock” of rising “hydrocarbon prices”. Paul Farrell at Marketwatch neatly summed up the parable, saying that “Munger is warning us “It’s Over” for America. Yes, “o-v-e-r,” America’s in decline, at the end-of-days, coming to “financial ruin,'”.
• Marc Faber, an investor best-known for calling the 1987 market crash, is warning investors that the US will go bankrupt and faces conflict with China over access to increasingly scarce oil resources.  He advises purchasing farmland and gold.
• Billionaire George Soros agrees with the idea of purchasing gold.  Even while calling it the “ultimate bubble”, he’s still investing more.  He’s also bullish on oil (signaling that he believes the price will rise).
• Former Chief Economist of the IMF, Simon Johnson warns that “we’re running out of time… to prevent a true depression” due to the fact that the “financial industry has effectively captured our government” and is “blocking essential reform”.
• Barton Biggs, former chief global strategist at Morgan Stanley, has warned since 2008 of a “breakdown of civilization” and gives a “one in ten” chance of anarchy in the next several years.
• Jim Rogers also warns of civil unrest over the next few years.  See also this list of officials and experts which are forecasting similar developments.

And polling continues to report on the breakdown of faith in government. Last week came the shocking Rasmussen poll that only 21% of Americans say that the government still retains the “consent of the governed”.  A new CNN poll reports that a majority of Americans “think the federal government’s [sic] become so large and powerful that it poses an immediate threat to the rights and freedoms of ordinary citizens.”

This is not a partisan issue, this is not about left vs. right.  This is about building lifeboats and finally beginning to make some sober, serious decisions about real and immediate threats to both our “way of life” and to our lives themselves.   Look back over the list of people above, and what do you find?  Millionaires, billionaires, “leaders”, and all-around very smart people warning of the potential for our society to breakdown, in one way or another.  Ignore them at your own peril.