(Interviewed by Louis James, Editor, International Speculator)

This interview was first published on November 24, 2010.

Editor’s Note: In yesterday’s Weekend Edition, Casey Research founder Doug Casey explained that the TSA serves no useful purpose, and it doesn’t keep you safe.

Today, Doug says Americans are the laughing stock of the world…

Louis James: I’ve just looked up some sample news reports, including the screaming three-year-old and that guy’s “don’t touch my junk” cell-phone recording that’s going around, for people who haven’t seen them.

Doug: This is, in my view, criminal malfeasance. These people are com­pletely out of control. But, more importantly, it’s a sign of the times. An atmosphere of suspicion, antagonism, envy, and fear is becoming more pervasive every day in the U.S. and Europe. With every real or imagined “terrorist” event, it gets ramped up more. The TSA now has goons patrolling trains and bus stations. A clever bad guy will attack one of those, so that all public travel in the U.S. would be as bad as it is in the airports. Then, a couple incidents using cars and trucks, which would “prove” the necessity for 100,000 more TSA people. Eventually, you’d be unable to travel anywhere, in any way, without the prospect of inspection and detention.

L: People do seem to be realizing this danger. The outrage has become great fodder for comedians. There are some Internet spoofs of the TSA pat-downs going around, including one from Saturday Night Live I just dug up.

Speaking of spoofs, do you remember the Airplane! movies made back in the 1970s to spoof the Airport dramas? In the second one, there’s a scene in which two main characters are talking in the foreground, and in the background, people are trooping through the magnetometer with guns, bandoliers, and bazookas, while a little old lady is thrown against a wall and frisked. These movies are totally slapstick, intended to be utterly ridiculous, and now life is imitating fiction.

Doug: I know; Americans are now the laughingstock of the world. Life is clearly imitating art at this point. There’s no question about it. I just wish it would get to the point it did in V for Vendetta, towards the end of the movie…and sooner rather than later. But I fear that whatever replaces the current system, at least for a while, will be even worse before it eventually gets better. The French Revolution may offer a precedent. It was great to get rid of Louis XVI…but then came Robespierre.

L: It certainly seems to be a sign of our times. Evidence of the decay of the empire, as you say; the roaches are coming out of the woodwork and marching about in the light of day with arrogance and disdain for their inferiors. On the other hand, the head TSA roach did get called out on the mat. The Internet is buzzing with praise for Ron Paul’s efforts to put them in their place. Do you think there’s any hope Americans will put their collective foot down and stop the airport grope-fest?

Doug: No. Some polls show citizens are outraged, but most others suggest that they are cheering the TSA on. The fact is that when you deal with almost anybody, as an individual, they are generally affable and sen­sible. But we’re dealing here with mob psychology and governments. Therefore you’re dealing with the lowest common denominator and the basest motives and emotions. At this point, the whole system is in a self-reinforcing downward spiral. It needs to be flushed.

L: Hmmm. There was a recent comedy about an improbable romance between a “nobody” and a girl who’s totally “out of his league.” What job did they give the guy to epitomize the insignificance of his life? He was a TSA goon. But it was a Hollywood fantasy, so he was, of course, an underappreciated nice guy.

Doug: That’s classic. But in real life, even people who would ordinarily be nice tend to let the demons within out, once they’re sucked into power within an abusive system. It’s like the Milgram Experiment. You can put an ordinary person into an authoritarian system, and he starts acting as he’s told to. And the public starts acting like sheep. This is why it only takes one guard to intimidate 100 prisoners.

Take the example of Germany. It was a civilized country in the 1920s, but when the wrong people got in power, the 20 percent of the 20 percent who are the worst people came out of the woodwork and joined the SS and the Gestapo. They were mostly pretty average nothing/nobody people who let power go to their heads, just like the people who work for the TSA today.

The Black Riders have come out from Mordor, and their minions are swarming over the land.

L: Someone replicated the Milgram Experiment recently. I’m amazed they got it past an ethics committee. As for the TSA, here’s a collection of horror stories to back you up.

What’s really scary is all the preparation our tireless public servants have done, setting up systems that seem benign (or at least mostly harmless) now, but pave the way for serious abuse. The suspension of posse comitatus for the drug war, the declaration of U.S. citizens to be “enemy combatants” (a term not mentioned in the U.S. Constitution) and therefore without the rights guaranteed by the Constitution, the stories about the FEMA camps already built, wiretaps without warrants, the erosion of the Second Amendment (the right to keep and bear arms), “free speech zones” where free speech is allowed…all of these things are police-state tools.

Right now, the U.S. still feels relatively free. You and I can have this conversation without being sent to the gulag. But make a joke in a TSA screening checkpoint, and see how free you feel. Or make a politically incorrect statement on a college campus. What happens when these insects, with real or manufactured approval from the masses clamoring for security, feel truly free to do whatever they please?

Doug: The cat’s totally out of the bag now. It’s become Kafkaesque. It’s gotten so bad, many people I know go out of their way not to fly through the U.S. Even if you’re not leaving the airport but are just making a flight connection, you have to go through the indignities of customs and immigration, and then you have to deal with these lowlifes at the TSA. And it’s just going to get worse.

I’m interested in, but not looking forward to, seeing what happens on my next trip to the U.S. Flying in most parts of the world is still fairly mellow, unless it’s a flight to the U.S. I plan on opting out next time and not using the back-scatter device. I just have to keep my cool. These peo­­­ple can sense I have an attitude about these things…and frankly, I have only contempt for people who don’t have an attitude. They either have no self-respect or no intelligence. But it’s pointless to lose your tem­per, since you’re dealing with robots. Raging against the machine just depletes your own resources, and it can actually strengthen the machine.

The wisest course is to minimize your flying, and soon other travel, in the U.S. That means spending a minimum of time in the U.S., but since there is relatively much less wealth and opportunity in the U.S. with each passing day, that’s less and less of an inconvenience. I fear it’s going to get much worse, at an accelerating rate.

L: And to add insult to injury, none of this makes anyone one bit safer, while there are systems that apparently do. They don’t pat people down in Israeli airports, for example, and yet they’ve not had a breach of security for years. Here’s a video I found that makes that point.

Doug: I suppose. The Israelis have gone out of their way to hire street-smart operators, which won’t ever happen in the U.S. And they can be very politically incorrect, looking for a certain type (basically a young Muslim male); that will never happen in the U.S. either. And they’ve been lucky; only a complete idiot will hit such a hard target. But Israel is a theocratic, ethnically exclusive police state: hardly a model to follow. And I don’t like being interrogated by some fool in a uniform, either.

On the bright side, this gross violation of people’s rights by the TSA is so personal, it could be the thing that actually pushes the U.S. over a psychological tipping point, and gets Americans to act like Americans and say, “I’m not going to take any more!” At some point, even a cowering dog will stop cowering and bite. At least in theory.

The would be good for the country but could make things turn pretty ugly in the interim, which is one reason I’m glad I don’t have to, and don’t, spend much time in the U.S. anymore.

L: But you’ve said before that the Land of the Free and the Home of the Brave has been turned into the Land of the Lapdogs and the Home of the Whipped Dogs. Do you actually think there’s a line beyond which U.S. citizens can’t be pushed and will develop the spine to act like Americans?

Doug: Well, one can hope. With millions and millions of people losing their houses and almost 40 million people receiving food stamps, while corporate execs loot their publicly traded and government-subsidized em­ployers for billions in bonuses, and inflation set to take off in the not-too-distant future, these sorts of indignities could push people over the edge.

Sometimes, it amazes me to see the stock market going up in the face of all this volatility, but I believe it’s doing so because of the creation of all these trillions and trillions of currency units. Not because of any fundamental soundness in the economy. This has me thinking of the ideal speculations for the next little while.

L: Okay, but generally, investment implications would be as with other straws in the wind spelling out trouble and volatility: liquidate, consolidate, create, and speculate.

Doug: And diversify your political risk. As you know, I always like to look at the bright side of things. In this case, it will be interesting to see if the looming complete bankruptcy of the U.S. government will force a deconstruction of the “national security” state, including disbanding of the TSA, which may well grow to 150,000 employees in the near future. Or whether it will turbocharge its growth for a while thereafter.

L: Very well then. Thanks for your input on the TSA today. I hope lots of people opt out!

Doug Casey is a multimillionaire speculator and the founder of Casey Research. He literally wrote the book on profiting during economic turmoil. Doug’s book, Crisis Investing, spent multiple weeks as number one on The New York Times best sellers list and was the best-selling financial book of 1980. Doug has been a regular guest on national television, including spots on CNN, Merv Griffin, Charlie Rose, Regis Philbin, Phil Donahue, and NBC News.

Doug and his team of analysts write The Casey Report, one of the world’s most respected investment advisories. Each month, The Casey Report provides specific, actionable ideas to help subscribers make money in stocks, bonds, currencies, real estate, and commodities. You can try out The Casey Report risk-free by clicking here.