How did it ever happen? I woke up this morning, and was already halfway through my coffee when I felt a shock to the solar plexus, or was it my brain. A voice spoke to me and asked: “How could you ever have written an article on “Let’s Stop Lying about Solar: The Seven Dirty Secrets” and left out the most important one of all, the eighth dirty secret? Here is the headline in The Economist that woke me up: “Is Germany once again the Sick Man of Europe?” And it goes on to inform us that Germany’s consumers have a bigger carbon footprint than either France or Italy, and, in a frightening step with no alternative backup plans, decommissioned all its nuclear power plants. So now, dirty coal plants are being fired up to meet demand. As Reuters warns, “Germany is bleeding cash to keep the lights on.”

Why did I omit this key point in my article? The answer was simple. It was because—like most folks—I had forgotten “the big picture,” the picture that politicians and economists want us to forget. That’s why they write the way they do, deploying abstractions, jargon, and statistical charts. Their purpose is to trigger MEGO syndrome in the reader, “my eyes glaze over.” You stop reading the article and turn to some “real” news, like about tsunamis in Tahiti, which is much more exciting. You leave the macro-economics to the 700 Economics PhDs sitting in the Federal Reserve, to figure this stuff out. After all, they’re the smart ones, aren’t they?  This is dangerous. You should at least know what’s going on. Your financial health is at stake.

The 8th Dirty Secret of Solar:

• Overspending for Solar Can Capsize an Entire National Economy.  It is turning Germany into “The Sick Man of Europe”

Here is the story of how solar helped cripple Germany’s economy. It is a story consisting of three simple steps: overspending, printing money, and triggering inflation. It can stand as an object lesson in macro-economics, and as a warning against Big Solar for the world.

Step #1: BLEEDING RED INK: MASSIVE OVERSPENDING ON SOLAR, CREATING LOSSES

A living example of this: Germany has spent a half trillion dollars on energy, apparently with no R&D prototyping, ROI analyses, backup plans, or clear project management protocols. It is being run by politicians, not by professional electrical engineers and climate scientists.

Step #2: FAKE MONEY TO THE RESCUE: FIAT CURRENCY

In a Desperate Move to Prevent Bankruptcies, the Government prints Fiat Currency to cover its Massive Mismanagement of the Economy, producing all its Losses

Here’s how Fiat currency works, using Germany again as our example. Having already spent more than half a trillion dollars on renewables, with negligible results for solar (except for getting re-elected for 16 years in a row), Germany was so deeply in debt that the government created a self-bailout. And how did they do this? They simply printed half-a-trillion dollars to cover their losses (search “half-a-trillion Germany Reuters”). This frightening trick is called by economists creating “Fiat” money, which is now practiced by many countries.

In common parlance, Fiat money is essentially fake or government counterfeit money—except that it’s legal. It is supported by neither gold nor silver nor commodities in the real world, but simply by a government “decree” or Fiat. (If only we could pay our income taxes that way!) It saves countries from bankruptcy after they have gone massively into debt mismanaging taxpayer money. Frequently, it is to pay for wars, after these have decimated an entire economy. What is extraordinary in the German case, however, is the sheer size of the self-bailout—a half-trillion, a staggering amount, even for the largest economy in Europe.

And why don’t we naïve citizens know about this trick? Because it goes under a flurry of aliases—which already should trigger our suspicions about the practice. Why be straight with the public? It’s just more government Gruberization at work. These aliases include the following: quantitative easing (QE), increasing the money supply, monetarism, printing money, stimulus money, digital currency, Globalist currency, bazooka policies (large-scale stimuluses) reflation, bond-buying schemes, easy monetary adpolicies, funny money, loose money, keystroke currency (electronically created money, by mere keystrokes on a computer, which are then passed through layers of complex financial instruments), or, most bluntly and on target, vampire squid currency (money sucking the lifeblood out of fellow, honest money).

Step #3: RESULT: FIAT CREATES INFLATION, THE SILENT KILLER

Inflation can be a mystery. Minds as great as Copernicus and Newton have tackled it. Marx never even began to understand it, however, because he never understood the Marginal Revolution in economics, which was based on high school calculus, which he never understood. Vladimir Lenin, on the other hand, apparently did, for he made the remark that inflation—the silent killer—would in the long run be the best way to destroy capitalist economies. It would simply “debauch” their currencies. Maynard Keynes agreed with Lenin, in the 1910s: “Through inflation, governments can confiscate—secretly and unobserved—a large portion of their citizens’ wealth.” Even Ernest Hemingway noted this political-economic trick in the 1930s: “the first panacea for a mismanaged nation is inflation of the currency.”

Spending on solar is just one of many ways to “trigger” the lethal killer through the massive debts paid for by Fiat money.  Hence inflation is also called “the invisible tax” or the “sneaky” tax (search “Forbes sneaky tax”).

So what is inflation? It’s a mystery to most people, but there are two simple ways of demystifying it. The first is to think of supply and demand. When huge amounts of Fiat money are poured into the economy (stimulus money, for shopping or the demand side) with no matching funds poured into the supply side (for the manufacturers to produce more goods), prices will rise. This is because there is more demand than there is supply. It’s that simple. Prices rise, which means prices inflate, but this process de-flates the purchasing power of your money. It takes only a year or two for this to show up in the economy, and for people to become aware of it, but then it’s too late and you’re too busy.

An even simpler way to explain inflation is to invert the old bank promotional slogan of “the magic of compound interest.” Inflation turns this upside down. It is “the un-magic of compound losses.” Say your savings are receiving 10% interest, they will double in just 7 years. But if your salary is losing its value at a 10% yearly inflation rate, it will self-destruct half its value in just 7 years. If your salary was $50.000 before a large government solar spending spree, it will eventually be worth $25,000 in buying power. This cripples your salary, although it’s invisible (except when your partner also has to go out and work a second salary to pay for your groceries). And the de facto loss here will be permanent.

I use the last example on purpose, for it is the same amount of loss that the European Union has inflicted upon its innocent citizenry. When it launched the Euro, the EU boasted that the new miracle currency would stabilize prices across Europe. The opposite happened. Just this month, in fact, we were informed that “The Euro has lost 45% of its value since 1997.” Welcome to politics, and to the macro-economic promises of the forever meddling economists.

The Lesson: No More Solar. Go Nuclear

Citizens and governments should wake up. The message is clear: halt large money-swallowing solar “farms,” and follow the successes of France, Sweden, and Bill Gates in the U.S., and start prototyping small nuclear. The new wave in nuclear technology is customizable reactors. One hopes that Germany will see the light, halt its dangerous, foolhardy course, and embrace the new nuclear.

Economics may be the dismal science, but that doesn’t mean it has to peddle obfuscation and obscurantism. The point of all this is that the economic liabilities of large solar farms—witness Germany—are dangerous, and can capsize entire national economies if pushed too far. Result for the citizen: caveat emptor, buyer beware. The lives and wellbeing of citizens are at stake.

Image: Oregon Department of Transportation via Flickr, CC BY 2.0.