In short, America is bankrupt. Our governments from the federal level down, our big corporations and a very large number of our well-off citizens have run up gargantuan debts, which can only be serviced given direct or indirect access to the flows of unearned wealth the US extracted from the rest of the planet. Those debts cannot be paid off, and many of them can’t even be serviced for much longer. The only options are defaulting on them or inflating them out of existence, and in either case, arrangements based on familiar levels of expenditure will no longer be possible. Since the arrangements in question include most of what counts as an ordinary lifestyle in today’s US, the impact of their dissolution will be severe.
In effect, the 5% of us in this country are going to have to go back to living the way we did before 1945. If we still had the factories, the trained workforce, the abundant natural resources and the thrifty habits we had back then, that would have been a wrenching transition but not a debacle. The difficulty, of course, is that we don’t have those things anymore. The factories were shut down in the offshoring craze of the Seventies and Eighties, when the imperial economy slammed into overdrive, and the trained workforce was handed over to malign neglect.
We’ve still got some of the natural resources, but nothing like what we once had. The thrifty habits? Those went whistling down the wind a long time ago. In the late stages of an empire, exploiting flows of unearned wealth from abroad is far more profitable than trying to produce wealth at home, and most people direct their efforts accordingly. That’s how you end up with the typical late-imperial economy, with a governing class that flaunts fantastic levels of paper wealth, a parasite class of hangers-on that thrive by catering to the very rich or staffing the baroque bureaucratic systems that permeate public and private life, and the vast majority of the population impoverished, sullen, and unwilling to lift a finger to save their soi-disant betters from the consequences of their own actions.
The good news is that there’s a solution to all this. The bad news is that it’s going to take a couple of decades of serious turmoil to get there. The solution is that the US economy will retool itself to produce earned wealth in the form of real goods and non-financial services. That’ll happen inevitably as the flows of unearned wealth falter, foreign goods become unaffordable to most Americans, and it becomes profitable to produce things here in the US again. The difficulty, of course, is that most of a century of economic and political choices meant to support our former imperial project are going to have to be undone.
The most obvious example? The metastatic bloat of government, corporate and non-profit managerial jobs in American life. That’s a sensible move in an age of empire, as it funnels money into the consumer economy, which provides what jobs exist for the impoverished classes. Public and private offices alike teem with legions of office workers whose labour contributes nothing to national prosperity but whose pay cheques prop up the consumer sector. That bubble is already losing air. It’s indicative that Elon Musk, after his takeover of Twitter, fired some 80% of that company’s staff; other huge internet combines are pruning their workforce in the same way, though not yet to the same degree.
The recent hullaballoo about artificial intelligence is helping to amplify the same trend. Behind the chatbots are programs called large language models (LLMs), which are very good at imitating the more predictable uses of human language. A very large number of office jobs these days spend most of their time producing texts that fall into that category: contracts, legal briefs, press releases, media stories and so on. Those jobs are going away. Computer coding is even more amenable to LLM production, so you can kiss a great many software jobs goodbye as well. Any other form of economic activity that involves assembling predictable sequences of symbols is facing the same crunch. A recent paper by Goldman Sachs estimates that something like 300 million jobs across the industrial world will be wholly or partly replaced by LLMs in the years immediately ahead.
Another technology with similar results is CGI image creation. Levi’s announced not long ago that all its future catalogues and advertising will use CGI images instead of highly-paid models and photographers. Expect the same thing to spread generally. Oh, and Hollywood’s next. We’re not too far from the point at which a program can harvest all the footage of Marilyn Monroe from her films, and use that to generate new Marilyn Monroe movies for a tiny fraction of what it costs to hire living actors, camera crews and the rest. The result will be a drastic decrease in high-paying jobs across a broad swathe of the economy.
The outcome of all this? Well, one lot of pundits will insist at the top of their lungs that nothing will change in any way that matters, and another lot will start shrieking that the apocalypse is upon us. Those are the only two options our collective imagination can process these days. Of course, neither of those things will actually happen.
What will happen instead is that the middle and upper-middle classes in the US, and in many other countries, will face the same kind of slow demolition that swept over the working classes of those same countries in the late 20th century. Layoffs, corporate bankruptcies, declining salaries and benefits, and the latest high-tech version of NO HELP WANTED signs will follow one another at irregular intervals. All the businesses that make money catering to these same classes will lose their incomes as well, a piece at a time. Communities will hollow out the way the factory towns of America’s Rust Belt and the English Midlands did half a century ago, but this time it will be the turn of upscale suburbs and fashionable urban neighbourhoods to collapse as the income streams that supported them disappear.
This is not going to be a fast process. The US dollar is losing its place as the universal medium of foreign trade, but it will still be used by some countries for years to come. The unravelling of the arrangements that direct unearned wealth to the US will go a little faster, but that will still take time. The collapse of the cubicle class and the gutting of the suburbs will unfold over decades. That’s the way changes of this kind play out.
As for what people can do in response this late in the game, I refer to a post I made on The Archdruid Report in 2012 titled “Collapse Now and Avoid the Rush”. In that post I pointed out that the unravelling of the American economy, and the broader project of industrial civilisation, was picking up speed around us, and those who wanted to get ready for it needed to start preparing soon by cutting their expenses, getting out of debt, and picking up the skills needed to produce goods and services for people rather than the corporate machine. I’m glad to say that some people did these things, but a great many others rolled their eyes, or made earnest resolutions to do something as soon as things were more convenient, which they never were.
Over the years that followed I repeated that warning and then moved on to other themes, since there really wasn’t much point to harping on about the approaching mess when the time to act had slipped away. Those who made preparations in time will weather the approaching mess as well as anyone can. Those who didn’t? The rush is here. I’m sorry to say that whatever you try, it’s likely that there’ll be plenty of other frantic people trying to do the same thing. You might still get lucky, but it’s going to be a hard row to hoe.
Mind you, I expect some people to take a different tack. In the months before a prediction of mine comes true, I reliably field a flurry of comments insisting that I’m too rigid and dogmatic in my views about the future, that I need to be more open-minded about alternative possibilities, that wonderful futures are still in reach, and so on. I got that in 2008 just before the real estate bubble started to go bust, as I’d predicted, and I also got it in 2010 just before the price of oil peaked and started to slide, as I’d also predicted, taking the peak oil movement with it. I’ve started to field the same sort of criticism once again.
We are dancing on the brink of a long slippery slope into an unwelcome new reality. I’d encourage readers in America and its close allies to brace themselves for a couple of decades of wrenching economic, social, and political turmoil. Those elsewhere will have an easier time of it, but it’s still going to be a wild ride before the rubble stops bouncing, and new social, economic, and political arrangements get patched together out of the wreckage.
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Subscribe“I reliably field a flurry of comments insisting that I’m too rigid and dogmatic in my views about the future, that I need to be more open-minded about alternative possibilities,”
While I read the essay I did have the sense the author was perhaps a little too certain of his views and predictions, and that the world is too complex for such straightforward analysis.
But by the time I reached the end, I felt this essay had the ring of truth. What Mr. Greer proposes comports with everything I witness around me, from the incredible own goal of the Russia sanctions, to the remarkable advances in IT, to the author’s perfect description of the vast army of useless bureaucrats who now try to micromanage every aspect of our lives but whose real function is to support the elite.
I’m an American. It was good while it lasted. But I’m afraid we overplayed our hand, or perhaps, as the author suggests, no matter what we did or try to do, empires inevitably end.
I would appreciate an essay from this author about druidry. What is it? What relevance does it have to the current age of extreme societal change? What references would the author recommend?
Great essay from an unexpected source.
Relevance of the druids? None. Best regarded as harmless fruitcakes.
We still have a few in the UK. They were originally the priestly caste of ancient celtic culture. A few still dance around Stonehenge on the occasion of the summer solstice. The fact that Stonehenge predate druidism by some thousands of year doesn’t faze the modern druid, but it should alert you as to the fatuous nature of their belief system. By the way the druids left no written records or oral traditions, so lord knows what they thought about anything – The only knowledge that we have of them comes from Roman sources – notably Julius Caesar. It is probably the inspiration for the 70’s British movie The Wicker Man – worth a watch, particularly if you like the idea of Brit Ekland swanning around without her clothes on (I do)
Tacitus*also provides an excellent description, which makes them sound like a Coven of LGBT activists.
Even the fabled Legions were shocked at the sight!
(*The Annals. XIV.30.)
Indeed, they are referred to by Tacitus. I had forgotten
Tacitus, who wrote about Britain (and other lands) without actually ever visiting; although, to be fair, his dad-in-law did. Tacitus, like Suetonius, is to be taken with a large pinch of salt, however, they are both enjoyably scandalous writers (I find Suetonius’ Latin easier than Tacitus’, though).
Suetonius Paulinus seems to have “sorted them out” very efficiently. Thanks mainly to the valiant Legionaries of Legio XIV Gemina & Legio XX Valeria, plus off course the Auxilia.
We shall NOT see there like again.
As the article isn’t about Druidism, either ancient or modern, what is the relevance of all this ?
The Druids were despised by the Romans as being beneath contempt for holding human sacrifice as a cornerstone of their religion. I agree 100% with them and think them Demonic.
Romans have a history of this prejudice and never allowed it under their tolerance of subject nations religions. One of the reasons they killed every Carthage resident, tore down the buildings and salted the ground was they held human sacrifices where they burnt babies.
Druisism is another form of Satanism and I could not read the article because of this guys picture, although I know a great more than this writer on the USA Dollar from a bit of skimming, I cannot comment on the article its self.
You just have, by claiming to be more knowledgeable about the Dollar.
Do Greer and his companions perform human sacrifices (as the Romans did in their gladiatorial games) ? No.
It is, of course, beyond absurd to claim that the Romans fought Carthage or the Druids from a holy horror of human sacrifice.
It’s true gladiatorial combat seems to us a little like human sacrifice , but it seems likely the Romans viewed the two things as completely separate . And perhaps the superficial similarity made their hatred of ‘human sacrifice’ more intense
It’s true gladiatorial combat seems to us a little like human sacrifice , but it seems likely the Romans viewed the two things as completely separate . And perhaps the superficial similarity made their hatred of ‘human sacrifice’ more intense
You just have, by claiming to be more knowledgeable about the Dollar.
Do Greer and his companions perform human sacrifices (as the Romans did in their gladiatorial games) ? No.
It is, of course, beyond absurd to claim that the Romans fought Carthage or the Druids from a holy horror of human sacrifice.
None.
The Druids were despised by the Romans as being beneath contempt for holding human sacrifice as a cornerstone of their religion. I agree 100% with them and think them Demonic.
Romans have a history of this prejudice and never allowed it under their tolerance of subject nations religions. One of the reasons they killed every Carthage resident, tore down the buildings and salted the ground was they held human sacrifices where they burnt babies.
Druisism is another form of Satanism and I could not read the article because of this guys picture, although I know a great more than this writer on the USA Dollar from a bit of skimming, I cannot comment on the article its self.
None.
As the article isn’t about Druidism, either ancient or modern, what is the relevance of all this ?
They were as truthful and accurate as the media is today. A sarcastic, off-hand remark about Incitatus – surely meant to deprecate some useless bureaucrats – became The emperor Gaius Caligula made his horse a senator! For current context, one need only hear what Governor Ron DeSantis actually says, and what the emotionally unhinged media says he says. A boulder of salt wouldn’t suffice.
Suetonius Paulinus seems to have “sorted them out” very efficiently. Thanks mainly to the valiant Legionaries of Legio XIV Gemina & Legio XX Valeria, plus off course the Auxilia.
We shall NOT see there like again.
They were as truthful and accurate as the media is today. A sarcastic, off-hand remark about Incitatus – surely meant to deprecate some useless bureaucrats – became The emperor Gaius Caligula made his horse a senator! For current context, one need only hear what Governor Ron DeSantis actually says, and what the emotionally unhinged media says he says. A boulder of salt wouldn’t suffice.
You have to remember that this would have been during the Roman Warm Period, which in Britain would have been experienced like a 400 year version of a heatwave on a bank holiday weekend.
How can that be, I thought humanity was incapable of surviving a couple of degrees warmer weather?
Vines grown north of York (Eboracum), but ‘they’ still had under-floor heating!
How can that be, I thought humanity was incapable of surviving a couple of degrees warmer weather?
Vines grown north of York (Eboracum), but ‘they’ still had under-floor heating!
Indeed, they are referred to by Tacitus. I had forgotten
Tacitus, who wrote about Britain (and other lands) without actually ever visiting; although, to be fair, his dad-in-law did. Tacitus, like Suetonius, is to be taken with a large pinch of salt, however, they are both enjoyably scandalous writers (I find Suetonius’ Latin easier than Tacitus’, though).
You have to remember that this would have been during the Roman Warm Period, which in Britain would have been experienced like a 400 year version of a heatwave on a bank holiday weekend.
Great movie with a haunting soundtrack. And Britt’s little nude scene where she bangs on the wall of the virgin inspector’s room is the sexiest thing I’ve ever seen on film.
As for this article, I can’t find any flaws in its analysis. My son is an actor; I wish he had taken up underwater welding, as his father suggested.
No evidence of breast enhancement either!
When movies are all CGI, there will be a premium on live theatre – just as now, as recorded music becomes ever more synthetic, people are paying more and more for the live experience. Meanwhile the underwater welding will be done by robots.
Your son made a good choice.
The Wicker Man? They used a body double, actually, a Glasgow stripper.
No evidence of breast enhancement either!
When movies are all CGI, there will be a premium on live theatre – just as now, as recorded music becomes ever more synthetic, people are paying more and more for the live experience. Meanwhile the underwater welding will be done by robots.
Your son made a good choice.
The Wicker Man? They used a body double, actually, a Glasgow stripper.
No one knows who they were, or where they came from.
Whether or not Nigel knows the difference between feet and inches is not my problem.
Whether or not Nigel knows the difference between feet and inches is not my problem.
interesting…. are you proposing good old ‘kill the messenger and not the message’…?
Fun fact – the fully nude scene shot from behind was using a body double as she refused to go fully nude for it. She was really annoyed afterwards as it looks like she had gone fully nude and felt her body didn’t have a body as good as hers.
Typical!
Typical!
Sorry to be the bearer of bad news, but Brit Ekland used a stunt double for the nude scenes.
Tacitus*also provides an excellent description, which makes them sound like a Coven of LGBT activists.
Even the fabled Legions were shocked at the sight!
(*The Annals. XIV.30.)
Great movie with a haunting soundtrack. And Britt’s little nude scene where she bangs on the wall of the virgin inspector’s room is the sexiest thing I’ve ever seen on film.
As for this article, I can’t find any flaws in its analysis. My son is an actor; I wish he had taken up underwater welding, as his father suggested.
No one knows who they were, or where they came from.
interesting…. are you proposing good old ‘kill the messenger and not the message’…?
Fun fact – the fully nude scene shot from behind was using a body double as she refused to go fully nude for it. She was really annoyed afterwards as it looks like she had gone fully nude and felt her body didn’t have a body as good as hers.
Sorry to be the bearer of bad news, but Brit Ekland used a stunt double for the nude scenes.
I had never heard of John Michael Greer until I read him on UnHerd. A contributor recommended his website ‘Ecosophia’ which I found very interesting. A strange mixture of ecology and Magick!
Greer edited the new edition of Israel Regardie’s “The Golden Dawn”.
Unlike Polidori and Stanhope, however luxuriant his beard he doesn’t come across as a fruit cake.
O dear, not another humourless ‘Plastic Paddy’?
Did you mean “plastic” as in explosives, Charles?
No Niall, but as in synthetic.
Ah well, that’s all right, then. But if you’re using “synthetic” to mean “affected or insincere”, I’m mystified.
I was simply answering the chap’s question about where to find some information about Greer’s version of Druidism.
As to “”humourless”, I yield to no-one in my appreciation of the double act performed by Polidori Redux and Charles Stanhope!
True reactionaries are few and far between, and not easy to counterfeit.
I suppose I just relish fruitcake with a glass of very dry sherry.
Fair enough.
Fair enough.
Ah well, that’s all right, then. But if you’re using “synthetic” to mean “affected or insincere”, I’m mystified.
I was simply answering the chap’s question about where to find some information about Greer’s version of Druidism.
As to “”humourless”, I yield to no-one in my appreciation of the double act performed by Polidori Redux and Charles Stanhope!
True reactionaries are few and far between, and not easy to counterfeit.
I suppose I just relish fruitcake with a glass of very dry sherry.
No Niall, but as in synthetic.
Did you mean “plastic” as in explosives, Charles?
O dear, not another humourless ‘Plastic Paddy’?
People may condemn the US in any way they like, the US is making agreement with whoever is dealing with, it’s never a robbery and the US is playing a major role in shepherding the world for peace and humanity, syclones, hunger, HIV/ AIDS all the poor countries ask for help from the caring USAID fund.
Relevance of the druids? None. Best regarded as harmless fruitcakes.
We still have a few in the UK. They were originally the priestly caste of ancient celtic culture. A few still dance around Stonehenge on the occasion of the summer solstice. The fact that Stonehenge predate druidism by some thousands of year doesn’t faze the modern druid, but it should alert you as to the fatuous nature of their belief system. By the way the druids left no written records or oral traditions, so lord knows what they thought about anything – The only knowledge that we have of them comes from Roman sources – notably Julius Caesar. It is probably the inspiration for the 70’s British movie The Wicker Man – worth a watch, particularly if you like the idea of Brit Ekland swanning around without her clothes on (I do)
I had never heard of John Michael Greer until I read him on UnHerd. A contributor recommended his website ‘Ecosophia’ which I found very interesting. A strange mixture of ecology and Magick!
Greer edited the new edition of Israel Regardie’s “The Golden Dawn”.
Unlike Polidori and Stanhope, however luxuriant his beard he doesn’t come across as a fruit cake.
People may condemn the US in any way they like, the US is making agreement with whoever is dealing with, it’s never a robbery and the US is playing a major role in shepherding the world for peace and humanity, syclones, hunger, HIV/ AIDS all the poor countries ask for help from the caring USAID fund.
“I reliably field a flurry of comments insisting that I’m too rigid and dogmatic in my views about the future, that I need to be more open-minded about alternative possibilities,”
While I read the essay I did have the sense the author was perhaps a little too certain of his views and predictions, and that the world is too complex for such straightforward analysis.
But by the time I reached the end, I felt this essay had the ring of truth. What Mr. Greer proposes comports with everything I witness around me, from the incredible own goal of the Russia sanctions, to the remarkable advances in IT, to the author’s perfect description of the vast army of useless bureaucrats who now try to micromanage every aspect of our lives but whose real function is to support the elite.
I’m an American. It was good while it lasted. But I’m afraid we overplayed our hand, or perhaps, as the author suggests, no matter what we did or try to do, empires inevitably end.
I would appreciate an essay from this author about druidry. What is it? What relevance does it have to the current age of extreme societal change? What references would the author recommend?
Great essay from an unexpected source.
Speaking as a software developer myself, while I’m certain that a large part of what I presently do will be replaced by LLMs, I’m also certain that software developers will still be required and in large numbers.
The reason I say so is that I have already seen vast tracts of software developer effort automated in the 15 years I’ve been doing this and the effect has been to raise the value which a software developer can deliver at the same time as expand demand for that developer’s services.
I’ll give two examples: firstly simply the assistance of package managers, which enable a developer to install third party libraries in his/her own code instead of writing complex code (which is commonly required in most applications) from scratch. This saves huge amounts of time – well over 90% in most cases if not more – but improves developer productivity so much that the market for developer services is far larger.
The second example is Amazon Web Services, and to a lesser extent the Microsoft offering Azure, and Google Cloud Platform, which are enormously complex platforms for the provision and delivery of web applications and services, that are in the process of taking over what used to be called server administration and then later devops. They make possible a lot of advanced features and services that an individual server admin could probably never have achieved on his own but – and this is the point – it is so complex in its own right that it has simply created a demand for a new class of devops expert. This is what will happen as LLMs displace automatable segments of existing developer working patterns: the fact that the LLM cannot automate everything will require the ultimate decision-making of a software developer to perform the human task of ensuring that the application as a whole actually does what people want of it.
So software developers won’t lose their jobs as such, it’s just that the jobs will change, much as they always have – the languages and frameworks I’m presently fluent in didn’t exist 20 years ago and the systems used back then are now obsolete, yet the software developer profession is going strong nonetheless.
As to the rest, I agree with much of the analysis, but I am not certain that the USA is done yet. The loss of the reserve currency, while a genuine threat, is not inevitable at this point. The USA still possesses an innovative capacity unmatched elsewhere on the planet and it will not go down quietly.
I do hope that the parasite class accurately described in the article – there are some brilliant observations in it, I must admit – are destroyed no matter what though, and that the effect comes to Britain as well. This class of people serve no useful purpose whether or not we can afford them and the sooner we get shot of the lot of them, the better.
Agree completely. Software is always evolving at a rapid pace. The software that is written today is built upon the software (and lower layer technologies) that were built yesterday. Untalented software engineers are always at risk as tech evolves, but talented engineers will evolve and be joined by new ones, and together they will continue to build the awesome new stuff that comes from the new tech. And so on.
I am a member of the parasite class.
I am responsible for the excess $600 billion that the United States spends on healthcare services administration above and beyond what comparable OECD nations spend on healthcare for no improvements in actual outcomes.
I am not a physician.
But, as long as countries and governments continue to allocate large pots of money, such as Medicare, Social Security, and other entitlement programs, there will continue to be a need for bureaucratic services to “manage“ that money.
And, I’m not even on the government side.
I am on the private side, tasked with interpreting, divining and devising schemes and routines to obtain that money in ways that are legal, ethical and non-fattening.
Well said.
I would like to add, that as a software developer even longer in the tooth than you, we used to be known as analyst/programmers.
This is important because more than 50% of my time is spent on the analysis part.
For example, even though I spend my days developing commodity trading systems for highly numerate, technical traders and their analysts, business people in general are not good at specifying exactly what it is that the system they want me to develop should do.
I foresee my role in future (and plenty of others) as being almost a translator of business type’s requests into specific language that AI code generators can work with, as well as validating that the AI generated code does what it is meant to.
For the non-techie that may read this, our code editors already have an AI-lite auto-complete feature whereby, similar to auto-correct, it will suggest completions based upon what one has already typed. Sometimes it works freakishly well, however, other times it comes out with nonsense. I believe that it will be a long time before we do away with the human element to check their output.
Amen to that.
I find the static typing and autocomplete features in my code editor brilliant, mainly because although I’ve been in front of a keyboard for almost 40 years at this stage, I’m still a hopeless typist. Just the fact that the code editor knows all the possible class and method names and will complete them for me makes me happy most days.
Amen to that.
I find the static typing and autocomplete features in my code editor brilliant, mainly because although I’ve been in front of a keyboard for almost 40 years at this stage, I’m still a hopeless typist. Just the fact that the code editor knows all the possible class and method names and will complete them for me makes me happy most days.
I got some help from GPT-3.5, but the code was quite buggy. Took a bit of time to get it to work properly. Perhaps I should have iterated with the GPT solution but it was easier to rework the code. Maybe the LLM will improve but I fully expect analysts will still be needed. While GPT scraped a lot off canned solutions to generate code, some of it carries original flaws that analysts must correct. I serious doubt Open AI will ever have access to most running proprietary code bases. Perhaps Microsoft may find it useful in debugging some of their leaky code.
US has to start producing usable products and skip financial vaporware. Management layers especially in health care need to go
Great to hear a coder talk about about coding.
IMHO, all this talk about AI seems to miss an important point. Intelligence—human especially—includes/works with emotion. Dare I say, no emotion no intelligence? So can this “all ubiquitous AI” we are hearing about actually be anything remotely intelligent and capable of taking over everything?
Screw you Descartes, mind is not, and never was, separate from body. Too bad so many of us believed him, or at least interpreted him in this way.
And yes, I read the part about the pituitary gland. The worst part of a very incoherent essay. And the part where he smuggled in God to make the whole enterprise remotely coherent?! Bah humbug. A pox on thee Rene.
Agree completely. Software is always evolving at a rapid pace. The software that is written today is built upon the software (and lower layer technologies) that were built yesterday. Untalented software engineers are always at risk as tech evolves, but talented engineers will evolve and be joined by new ones, and together they will continue to build the awesome new stuff that comes from the new tech. And so on.
I am a member of the parasite class.
I am responsible for the excess $600 billion that the United States spends on healthcare services administration above and beyond what comparable OECD nations spend on healthcare for no improvements in actual outcomes.
I am not a physician.
But, as long as countries and governments continue to allocate large pots of money, such as Medicare, Social Security, and other entitlement programs, there will continue to be a need for bureaucratic services to “manage“ that money.
And, I’m not even on the government side.
I am on the private side, tasked with interpreting, divining and devising schemes and routines to obtain that money in ways that are legal, ethical and non-fattening.
Well said.
I would like to add, that as a software developer even longer in the tooth than you, we used to be known as analyst/programmers.
This is important because more than 50% of my time is spent on the analysis part.
For example, even though I spend my days developing commodity trading systems for highly numerate, technical traders and their analysts, business people in general are not good at specifying exactly what it is that the system they want me to develop should do.
I foresee my role in future (and plenty of others) as being almost a translator of business type’s requests into specific language that AI code generators can work with, as well as validating that the AI generated code does what it is meant to.
For the non-techie that may read this, our code editors already have an AI-lite auto-complete feature whereby, similar to auto-correct, it will suggest completions based upon what one has already typed. Sometimes it works freakishly well, however, other times it comes out with nonsense. I believe that it will be a long time before we do away with the human element to check their output.
I got some help from GPT-3.5, but the code was quite buggy. Took a bit of time to get it to work properly. Perhaps I should have iterated with the GPT solution but it was easier to rework the code. Maybe the LLM will improve but I fully expect analysts will still be needed. While GPT scraped a lot off canned solutions to generate code, some of it carries original flaws that analysts must correct. I serious doubt Open AI will ever have access to most running proprietary code bases. Perhaps Microsoft may find it useful in debugging some of their leaky code.
US has to start producing usable products and skip financial vaporware. Management layers especially in health care need to go
Great to hear a coder talk about about coding.
IMHO, all this talk about AI seems to miss an important point. Intelligence—human especially—includes/works with emotion. Dare I say, no emotion no intelligence? So can this “all ubiquitous AI” we are hearing about actually be anything remotely intelligent and capable of taking over everything?
Screw you Descartes, mind is not, and never was, separate from body. Too bad so many of us believed him, or at least interpreted him in this way.
And yes, I read the part about the pituitary gland. The worst part of a very incoherent essay. And the part where he smuggled in God to make the whole enterprise remotely coherent?! Bah humbug. A pox on thee Rene.
Speaking as a software developer myself, while I’m certain that a large part of what I presently do will be replaced by LLMs, I’m also certain that software developers will still be required and in large numbers.
The reason I say so is that I have already seen vast tracts of software developer effort automated in the 15 years I’ve been doing this and the effect has been to raise the value which a software developer can deliver at the same time as expand demand for that developer’s services.
I’ll give two examples: firstly simply the assistance of package managers, which enable a developer to install third party libraries in his/her own code instead of writing complex code (which is commonly required in most applications) from scratch. This saves huge amounts of time – well over 90% in most cases if not more – but improves developer productivity so much that the market for developer services is far larger.
The second example is Amazon Web Services, and to a lesser extent the Microsoft offering Azure, and Google Cloud Platform, which are enormously complex platforms for the provision and delivery of web applications and services, that are in the process of taking over what used to be called server administration and then later devops. They make possible a lot of advanced features and services that an individual server admin could probably never have achieved on his own but – and this is the point – it is so complex in its own right that it has simply created a demand for a new class of devops expert. This is what will happen as LLMs displace automatable segments of existing developer working patterns: the fact that the LLM cannot automate everything will require the ultimate decision-making of a software developer to perform the human task of ensuring that the application as a whole actually does what people want of it.
So software developers won’t lose their jobs as such, it’s just that the jobs will change, much as they always have – the languages and frameworks I’m presently fluent in didn’t exist 20 years ago and the systems used back then are now obsolete, yet the software developer profession is going strong nonetheless.
As to the rest, I agree with much of the analysis, but I am not certain that the USA is done yet. The loss of the reserve currency, while a genuine threat, is not inevitable at this point. The USA still possesses an innovative capacity unmatched elsewhere on the planet and it will not go down quietly.
I do hope that the parasite class accurately described in the article – there are some brilliant observations in it, I must admit – are destroyed no matter what though, and that the effect comes to Britain as well. This class of people serve no useful purpose whether or not we can afford them and the sooner we get shot of the lot of them, the better.
Its funny watching this in real time
The US is stuck now, they have to continue to sanction and oppose the Russians, but that just pushes China and Russia closer together. India, Iran, the Saudis and others will make moves to their own advantage, but not the Europeans, we will be the last to figure it out. Occasionally the US president will visit countries asking for support, the locals just smile at the old man with dementia. But not the Europeans, we will be the last to figure it out
Added to that, reform now seems impossible in the US, an honest man trying to fix the system will be opposed by the elite, the scams must continue at all cost
“just pushes China and Russia closer together”
China has designs on E. Russia mate. Don’t bet on that being much of a partnership. Don’t even bet on Putin’s drunken kleptocracy being around for too long after his death either. I predict a bloody power grab in the Kremlin and the inevitable secession of the Asian states.
Generally, a little too much schadenfreude in this article; I’d like to see a counter-view from someone who knows more about economics than me.
Just read the MSM, it has everything you asked for
The MSM is totally ignorant about economics.
And most other subjects too.
And most other subjects too.
The MSM is totally ignorant about economics.
Notice that Russia must get certain chips from commercial washing machines and is seeking ammunition from North Korea. Meanwhile it can’t repair damaged gear so is pulling WW2 tanks into service. Aircraft are being grounded for lack of parts. The sanctions have created a shortfall in revenue as well. So the litany of sanctions not working is a bit hasty. I’m sure the Iranians might have means to evade sanctions, but as those channels get used they become more exposed.
Just read the MSM, it has everything you asked for
Notice that Russia must get certain chips from commercial washing machines and is seeking ammunition from North Korea. Meanwhile it can’t repair damaged gear so is pulling WW2 tanks into service. Aircraft are being grounded for lack of parts. The sanctions have created a shortfall in revenue as well. So the litany of sanctions not working is a bit hasty. I’m sure the Iranians might have means to evade sanctions, but as those channels get used they become more exposed.
Any ‘honest politicians’ will be opposed by woke & progressive pseudo-intellectuals rather than the elites (whatever they may be). While Biden has definitely seen better days, the progressives indulge in their own selective dementia.
And of the European countries the UK will be last of all, except perhaps for Ireland
I’m afraid you’re right, and, as an American, I’m afraid of a lot right now.
The only elegant way out for the US is to get Zelensky to agree a ‘peace deal’, attempt to spin that as a US victory of diplomacy, and then back out of sanctions.
But in the background of that, the US leadership need to radically and urgently reverse course on the Equity and Green agendas that they’re presently embedding throughout the bureaucracy, and the financial and education systems, double speed.
Ending the self-harming idiocy around the proxy war is hugely important, but the dollar will still fall if the USA commit policy-based hari kiri via the UN’s SDGs / Agenda 2030.
I agree, but its not going to happen, for a lot of reasons, the neocons for example
The US has painted itself onto a corner. The fish rots from the head
Sadly, I concur.
Sadly, I concur.
I agree, but its not going to happen, for a lot of reasons, the neocons for example
The US has painted itself onto a corner. The fish rots from the head
President Trump had it figured out but the Europeans laughed at him.
“just pushes China and Russia closer together”
China has designs on E. Russia mate. Don’t bet on that being much of a partnership. Don’t even bet on Putin’s drunken kleptocracy being around for too long after his death either. I predict a bloody power grab in the Kremlin and the inevitable secession of the Asian states.
Generally, a little too much schadenfreude in this article; I’d like to see a counter-view from someone who knows more about economics than me.
Any ‘honest politicians’ will be opposed by woke & progressive pseudo-intellectuals rather than the elites (whatever they may be). While Biden has definitely seen better days, the progressives indulge in their own selective dementia.
And of the European countries the UK will be last of all, except perhaps for Ireland
I’m afraid you’re right, and, as an American, I’m afraid of a lot right now.
The only elegant way out for the US is to get Zelensky to agree a ‘peace deal’, attempt to spin that as a US victory of diplomacy, and then back out of sanctions.
But in the background of that, the US leadership need to radically and urgently reverse course on the Equity and Green agendas that they’re presently embedding throughout the bureaucracy, and the financial and education systems, double speed.
Ending the self-harming idiocy around the proxy war is hugely important, but the dollar will still fall if the USA commit policy-based hari kiri via the UN’s SDGs / Agenda 2030.
President Trump had it figured out but the Europeans laughed at him.
Its funny watching this in real time
The US is stuck now, they have to continue to sanction and oppose the Russians, but that just pushes China and Russia closer together. India, Iran, the Saudis and others will make moves to their own advantage, but not the Europeans, we will be the last to figure it out. Occasionally the US president will visit countries asking for support, the locals just smile at the old man with dementia. But not the Europeans, we will be the last to figure it out
Added to that, reform now seems impossible in the US, an honest man trying to fix the system will be opposed by the elite, the scams must continue at all cost
Putting aside the Druid’ stuff which obvious raises one’s eyebrows, does not the general contention, not only conveyed here of course, understate the strength of the US approach to capitalism which continues to ‘best’ others including the CCP? In a week where Musk sent the most powerful rocket ever into the upper atmosphere, privately developed, are we not a bit myopic on how strong the US model remains?
Now it has some deficiencies for sure, but it’s ability to attract the best and brightest from around the world and provide them with capital to exploit opportunities in a country where the rule of law counts, remains incredibly powerful. The brightest and the best do not try to get a Green card into China. They may want to trade there, but not live there.
There are threats to this model, but one still suspects the ability to replicate this at scale elsewhere has limitations. In China the biggest block to it is of course the CCP itself. Such countries biggest weakness is how they are managed by a mafia unquestioned and unchallenged. That implodes itself in time.
I agree here completely, it’s far too soon to write off the United States. The suggestion that America is on the brink of collapse, that other nations are just waiting to step in is without evidence. For example, reading Peter Zeihan’s recent book ‘The End of the World’ paints a very different picture. Rather than USA collapsing into disaster it is the rest who will struggle without American military protection and demographic tomebombs which will affect none more than China. And Russia.
A Druid may fantasise about living in mud huts, worshipping nature, but I think this article is actually backwards, it is the United States who are in a far stronger position than pretty much anyone else.
Zehlin is a fool, he thinks the US has better demographics that Japan, China, Russia ect
The ability to assimilate immigrants might forestall the demographic collapse found in other places.
The USA is attracting immigrants.
But it isn’t assimilating them.
Since there is no longer a dominant US WASP culture to assimilate them into.
The US may not assimilate immigrants but it assimilates the children of immigrants and has been for a couple hundred years.
By courtesy of the dominant WASP culture.
Which is no longer there. There is no longer any definition of what “”American” is and the blacks and Hispanics don’t want to be “American”
Is that because the WASPs have lost their pioneer spirit?
No it’s because of LBJ and the lack of required assimilation of non Europeans and the most devastating that people aren’t having children at replacement rates.
A Toynbee points out that at the height of the power of Rome say, 300 BC to 200AD, barbarians wanted to assimilate into Roman culture because it was powerful and competent. Individual Romans were endowed with an incredible hardyness of body, mind and spirit combined with technical competence which made the culture attractive .
Compare the training of a young WASP with someone from the Equine or Patrician classes between 300BC and 200AD. The ability of Rome to beat Hannibal after the defeat at Cannae when 60,000 Romans were killed and 10,000 captured demonstrates hardyness of spirit.
A Toynbee points out that at the height of the power of Rome say, 300 BC to 200AD, barbarians wanted to assimilate into Roman culture because it was powerful and competent. Individual Romans were endowed with an incredible hardyness of body, mind and spirit combined with technical competence which made the culture attractive .
Compare the training of a young WASP with someone from the Equine or Patrician classes between 300BC and 200AD. The ability of Rome to beat Hannibal after the defeat at Cannae when 60,000 Romans were killed and 10,000 captured demonstrates hardyness of spirit.
They have become decadent and lost their traditional Protestant faith.
So yes, they have lost their spirit.
No it’s because of LBJ and the lack of required assimilation of non Europeans and the most devastating that people aren’t having children at replacement rates.
They have become decadent and lost their traditional Protestant faith.
So yes, they have lost their spirit.
Americans who are born here tend to exhibit American-ness. I don’t know what you’re attempting to say. Especially about blacks and Hispanics. Sounds like classic ass chatter. The stank kind.
Is that because the WASPs have lost their pioneer spirit?
Americans who are born here tend to exhibit American-ness. I don’t know what you’re attempting to say. Especially about blacks and Hispanics. Sounds like classic ass chatter. The stank kind.
Many assimilate into the grievance culture. They actually assimilated best during Theodore Roosevelts day but that is because of societal pressure and as stated above the dominant population was ASP and the immigrants were mainly European; even so they stopped importing anyone occasionally. After 1965 it’s been downhill ever since.
By courtesy of the dominant WASP culture.
Which is no longer there. There is no longer any definition of what “”American” is and the blacks and Hispanics don’t want to be “American”
Many assimilate into the grievance culture. They actually assimilated best during Theodore Roosevelts day but that is because of societal pressure and as stated above the dominant population was ASP and the immigrants were mainly European; even so they stopped importing anyone occasionally. After 1965 it’s been downhill ever since.
The US may not assimilate immigrants but it assimilates the children of immigrants and has been for a couple hundred years.
The USA is attracting immigrants.
But it isn’t assimilating them.
Since there is no longer a dominant US WASP culture to assimilate them into.
The ability to assimilate immigrants might forestall the demographic collapse found in other places.
To be fair he didn’t say the USA is on the brink of collapse. I’m an American and it seems to me like the country is on the way to becoming Brazil with nuclear weapons. A big country with natural barriers all around, messy stupid politics, and some nice things. What he didn’t mention about the end of dominating “Empire” is the attendant increase in peer, conventional war that comes with it. We’ll miss the problems we had.
America is also suffering a demographic time bomb.
But one that is being offset by immigration, unlike Russia or China’s demographic time bombs.
But that immigration, in addition to tearing the USA politically, is changing the USA out of recognition, since the traditional WASP version of the USA won’t survive the disappearance of the WASPS, however much people pretend that it will.
WASPs started disappearing from the US early in the 20th century with the mass arrival of Eastern and Southern Europeans.
WASPs started disappearing from the US early in the 20th century with the mass arrival of Eastern and Southern Europeans.
Zehlin is a fool, he thinks the US has better demographics that Japan, China, Russia ect
To be fair he didn’t say the USA is on the brink of collapse. I’m an American and it seems to me like the country is on the way to becoming Brazil with nuclear weapons. A big country with natural barriers all around, messy stupid politics, and some nice things. What he didn’t mention about the end of dominating “Empire” is the attendant increase in peer, conventional war that comes with it. We’ll miss the problems we had.
America is also suffering a demographic time bomb.
But one that is being offset by immigration, unlike Russia or China’s demographic time bombs.
But that immigration, in addition to tearing the USA politically, is changing the USA out of recognition, since the traditional WASP version of the USA won’t survive the disappearance of the WASPS, however much people pretend that it will.
I often see the line about America being more attractive than China for migrants being put forward as a basis for believing that America has a more superior government than that of China but I don’t think it’s a valid point, or at least not as strong as some think.
The two nations have extremely different histories that make such a comparison very weak. China, like India and Japan have been highly populated since ancient times. America has a very low population density and has been receiving a steady flow of immigrants for 500 years. Were Europeans migrating to colonial era America because it had a superior system of government ?
You may also be underestimating the level of foreign technical expertise that China does attract. I personally have met many Russian scientists (mainly military) also German and Korean technicians (mainly civilian manufacturing) during my time in China. It’s not a vast number but it doesn’t need to be given the size of the Chinese population.
The Belt and Road Initiative also comes with a large number of scholarships for student from participating countries to study in Chinese universities. Upon graduation those young people will mainly return to their homes to be a bridge between the Chinese and locals in BRI projects.
You may consider the CCP to be a mafia gang but then it’s a mafia gang that has pulled off the largest human economic development in history. Gargantuan amounts of literally concrete results, Not bad for a criminal conspiracy.
The CCP see themselves as the heirs to the very long tradition of the Confucian Imperial bureaucracy. Their “Socialism with Chinese Characteristics” is in reality Techno-Confucianism with Socialist Characteristics. It’s an interesting contrast with the Russian Soviet model. When the Soviet mismanagement drove the economy into the ground there was chaos and a total ideological vacuum. It didn’t happen in China because the government bureaucracy had two thousand years of Confucianism to draw upon.
Read some of the government publications coming out of Beijing, watch how their officials comport themselves in public. It’s all Confucian gentleman-scholar, Marx and Engels are long dead and buried.
There is something in your points JD. However some further thoughts.
Currently no contest on the GDP per capital. It’s 6 times higher in the US and CCP not closing that anytime soon.
As regards the BRI, the CCP is already finding infrastructure diplomacy not as easy as they thought. Significant debt risk remains with the Chinese state. Many of the deals do not look as good to the foreign partners over time either, esp as corruption increases cost – and of course the Chinese construction companies often used are not subject to proper competition making them inevitably sclerotic and prone to cost inflation. The CCP is surfing a large debt bubble, slowing growth, major demographic challenges and it has to steal much of the cutting edge technology and science from the West (remember they also couldn’t design an effective Vaccine and they had a head-start. Xi’s almost certainly had a Western Vaccine!). These structural problems in part why Xi’s eye’s turn to Taiwan and the need for a national distraction. Of course any conflict there will quickly adversely impact on them as much as rest of the World. 40% of it’s trade goes through that bottleneck. It’d get choked quickly.
As regards Confucianism – critics might argue it just helps perpetuate hierarchies and ossification which thriving capitalism and a growing middle class will inevitably butt up against and rebel. It can be used for a while to buttress the CCP model but eventually one party rule, and the inevitable corruption that generates, corrodes itself.
Xi seems to be reversing his desire to centrally plan his world domination. Meanwhile, many are trying to decouple from China as it begins to act as a major military power. Observe that China’s military has no real world experience relying on observation of US ways of war. The US is rapidly reworking it’s military in response to China’s posture. Others have become dependent on near slave labor from China and are beginning to question how those profits are being used.
Xi seems to be reversing his desire to centrally plan his world domination. Meanwhile, many are trying to decouple from China as it begins to act as a major military power. Observe that China’s military has no real world experience relying on observation of US ways of war. The US is rapidly reworking it’s military in response to China’s posture. Others have become dependent on near slave labor from China and are beginning to question how those profits are being used.
There are cultural issues that can differentiate nations, not the least is the ability to innovate. Cultures that tolerate failure might affect society. China seems intent of identifying genetic factors which interact with culture but they might not really matter.
To innovate one needs freedom. Cenorship reduces the mind to think freely, initiative and ingenuity . A society whih has extensive censorship and centralised bureaucratic control innovates slowly , compare Britain with France from 1660 to 1800. Britain had a quarter of the wealth of France in 1660 yet we created the Scientific and Industrial Revolutions because we were free to think and act. Freer then, than today.Look at life of Newton, James Brindley and G Stephenson; born into poverty yet had the freedom think and act and in doing so changed the World.
What the USA inherited from Britain, specifically England, is the freedom to think and act within a nation whose rules were drafted by the people and for the people (n Anglo Saxon Laws). A people who realised that through honest hard competent work conditions could be improved which is that specified by A Toynbee in his Study of History .
To innovate one needs freedom. Cenorship reduces the mind to think freely, initiative and ingenuity . A society whih has extensive censorship and centralised bureaucratic control innovates slowly , compare Britain with France from 1660 to 1800. Britain had a quarter of the wealth of France in 1660 yet we created the Scientific and Industrial Revolutions because we were free to think and act. Freer then, than today.Look at life of Newton, James Brindley and G Stephenson; born into poverty yet had the freedom think and act and in doing so changed the World.
What the USA inherited from Britain, specifically England, is the freedom to think and act within a nation whose rules were drafted by the people and for the people (n Anglo Saxon Laws). A people who realised that through honest hard competent work conditions could be improved which is that specified by A Toynbee in his Study of History .
China had a very low base because of the destruction caused by the CCCP. The massive growth was possible by adopting and stealing western technology and by having a large amount of cheap labour. However as the wages of labour has inreased, low value manufacturing has moved elsewhere. There is a massive debt bubble. The question is whether China can innovate.
There is something in your points JD. However some further thoughts.
Currently no contest on the GDP per capital. It’s 6 times higher in the US and CCP not closing that anytime soon.
As regards the BRI, the CCP is already finding infrastructure diplomacy not as easy as they thought. Significant debt risk remains with the Chinese state. Many of the deals do not look as good to the foreign partners over time either, esp as corruption increases cost – and of course the Chinese construction companies often used are not subject to proper competition making them inevitably sclerotic and prone to cost inflation. The CCP is surfing a large debt bubble, slowing growth, major demographic challenges and it has to steal much of the cutting edge technology and science from the West (remember they also couldn’t design an effective Vaccine and they had a head-start. Xi’s almost certainly had a Western Vaccine!). These structural problems in part why Xi’s eye’s turn to Taiwan and the need for a national distraction. Of course any conflict there will quickly adversely impact on them as much as rest of the World. 40% of it’s trade goes through that bottleneck. It’d get choked quickly.
As regards Confucianism – critics might argue it just helps perpetuate hierarchies and ossification which thriving capitalism and a growing middle class will inevitably butt up against and rebel. It can be used for a while to buttress the CCP model but eventually one party rule, and the inevitable corruption that generates, corrodes itself.
There are cultural issues that can differentiate nations, not the least is the ability to innovate. Cultures that tolerate failure might affect society. China seems intent of identifying genetic factors which interact with culture but they might not really matter.
China had a very low base because of the destruction caused by the CCCP. The massive growth was possible by adopting and stealing western technology and by having a large amount of cheap labour. However as the wages of labour has inreased, low value manufacturing has moved elsewhere. There is a massive debt bubble. The question is whether China can innovate.
You cannot overestimate how important the rule of law and stability actually are.
To live in a country where there is an appreciable risk that you could loose everything if you run foul of the authorities or a powerful individual is a powerful incentive to move your family and your assets, which why you see many of the wealthy in China and Russia moving their children and money to western nations
Seconded.
Agreed, but that imbalance too is changing. The introduction of CBDCs in most western economies (closely followed by social credit scores) will ensure there is an ‘appreciable risk that you could lose everything if you run foul of the authorities’ anywhere in the world.
Is that the US you are talking about? You can also lose everything there if you get sick. Not a pleasant place for a lot of its citizens
When I said wealthy I meant wealthy
Most working people have insurance.
When I said wealthy I meant wealthy
Most working people have insurance.
We are losing that here now too in the major cities.
Seconded.
Agreed, but that imbalance too is changing. The introduction of CBDCs in most western economies (closely followed by social credit scores) will ensure there is an ‘appreciable risk that you could lose everything if you run foul of the authorities’ anywhere in the world.
Is that the US you are talking about? You can also lose everything there if you get sick. Not a pleasant place for a lot of its citizens
We are losing that here now too in the major cities.
I agree here completely, it’s far too soon to write off the United States. The suggestion that America is on the brink of collapse, that other nations are just waiting to step in is without evidence. For example, reading Peter Zeihan’s recent book ‘The End of the World’ paints a very different picture. Rather than USA collapsing into disaster it is the rest who will struggle without American military protection and demographic tomebombs which will affect none more than China. And Russia.
A Druid may fantasise about living in mud huts, worshipping nature, but I think this article is actually backwards, it is the United States who are in a far stronger position than pretty much anyone else.
I often see the line about America being more attractive than China for migrants being put forward as a basis for believing that America has a more superior government than that of China but I don’t think it’s a valid point, or at least not as strong as some think.
The two nations have extremely different histories that make such a comparison very weak. China, like India and Japan have been highly populated since ancient times. America has a very low population density and has been receiving a steady flow of immigrants for 500 years. Were Europeans migrating to colonial era America because it had a superior system of government ?
You may also be underestimating the level of foreign technical expertise that China does attract. I personally have met many Russian scientists (mainly military) also German and Korean technicians (mainly civilian manufacturing) during my time in China. It’s not a vast number but it doesn’t need to be given the size of the Chinese population.
The Belt and Road Initiative also comes with a large number of scholarships for student from participating countries to study in Chinese universities. Upon graduation those young people will mainly return to their homes to be a bridge between the Chinese and locals in BRI projects.
You may consider the CCP to be a mafia gang but then it’s a mafia gang that has pulled off the largest human economic development in history. Gargantuan amounts of literally concrete results, Not bad for a criminal conspiracy.
The CCP see themselves as the heirs to the very long tradition of the Confucian Imperial bureaucracy. Their “Socialism with Chinese Characteristics” is in reality Techno-Confucianism with Socialist Characteristics. It’s an interesting contrast with the Russian Soviet model. When the Soviet mismanagement drove the economy into the ground there was chaos and a total ideological vacuum. It didn’t happen in China because the government bureaucracy had two thousand years of Confucianism to draw upon.
Read some of the government publications coming out of Beijing, watch how their officials comport themselves in public. It’s all Confucian gentleman-scholar, Marx and Engels are long dead and buried.
You cannot overestimate how important the rule of law and stability actually are.
To live in a country where there is an appreciable risk that you could loose everything if you run foul of the authorities or a powerful individual is a powerful incentive to move your family and your assets, which why you see many of the wealthy in China and Russia moving their children and money to western nations
Putting aside the Druid’ stuff which obvious raises one’s eyebrows, does not the general contention, not only conveyed here of course, understate the strength of the US approach to capitalism which continues to ‘best’ others including the CCP? In a week where Musk sent the most powerful rocket ever into the upper atmosphere, privately developed, are we not a bit myopic on how strong the US model remains?
Now it has some deficiencies for sure, but it’s ability to attract the best and brightest from around the world and provide them with capital to exploit opportunities in a country where the rule of law counts, remains incredibly powerful. The brightest and the best do not try to get a Green card into China. They may want to trade there, but not live there.
There are threats to this model, but one still suspects the ability to replicate this at scale elsewhere has limitations. In China the biggest block to it is of course the CCP itself. Such countries biggest weakness is how they are managed by a mafia unquestioned and unchallenged. That implodes itself in time.
I find a lot of the points you make compelling on a paradigmatic (not dogmatic) level, but there is one howler — forgive the term — that cries out for correction: you say the US dollar settled into its slot as a global default (reserve) currency in the 1970s. That is actually — to my understanding — the opposite of what happened. The dollar was effectively a global reserve currency from the inception of the Bretton Woods system of regulated international exchange rates for Western currencies from 1944 till the anarchic, unilateral dismantling of this system between 1971-1973, when the Nixon administration refused to convert dollars to gold, which was the anchor of the entire system. Dollars were pegged to gold. Other currencies were pegged to the dollar. After the oil shock in 1973, and the inception of inflation, the dollar was effectively allowed to float, without gold to anchor it, as Nixon had suspended the dollar / gold peg. So other currencies were forced to float also. The Europeans managed for about another thirty years to maintain a system of relative exchange rates fixed amongst themselves, with varying degrees of rigidity and flexibility. But the 1970s is when the dollar’s role as a global reserve currency effectively ended. The fact that it has maintained awe-inspiring privileges of seigniorage has more to do with the fact that many markets — capital markets, private equity markets, oil markets, bond markets, swaps, derivatives, equity markets, etc. — all operate in dollars, and those markets are global. The dollar remains dominant because those markets have awe-inspiring global scale and depth in terms of sheer liquidity. They have their own momentum and they make their own weather. But — and this is where your argument picks up again — these markets are now almost wholly disconnected from the standard of living and day to day economic reality of millions of Americans. That is the struggle. One brilliant answer would be unions, which dominated the very same thirty-year period in which the U.S. dollar was actually the dominant global currency. That was — not paradoxically — when unions also steered a much larger share of the US labour force. Labour and capital were not adversarial to the degree they are now. Now, they have unconsciously uncoupled and they have no prospect to reunite. That’s fairly tragic.
Quite accurate. And much was driven by energy connections. Whether we really have peak oil has been debated since the 70’s and we keep finding more and finding cheaper ways to extract it. The Arctic remains a target for more and we are surprised that old wells thought dry are producing again. Energy abundance has allowed the modern world and while the greens oppose it their time will expire. How else can we power Bitcoin? Or more seriously, the arrival of AI which requires massive computing resources.
One key point that is frequently overlooked when discussing the dollar is that a US trade deficit is an essential feature of it remaining the world’s currency. In many (especially third-world) countries, dollars are preferred to the local currency. China may indeed become the largest economy in the world, but there is no indication that it is prepared to run the necessary persistent balance of payments deficit to challenge the position of the dollar.
Quite accurate. And much was driven by energy connections. Whether we really have peak oil has been debated since the 70’s and we keep finding more and finding cheaper ways to extract it. The Arctic remains a target for more and we are surprised that old wells thought dry are producing again. Energy abundance has allowed the modern world and while the greens oppose it their time will expire. How else can we power Bitcoin? Or more seriously, the arrival of AI which requires massive computing resources.
One key point that is frequently overlooked when discussing the dollar is that a US trade deficit is an essential feature of it remaining the world’s currency. In many (especially third-world) countries, dollars are preferred to the local currency. China may indeed become the largest economy in the world, but there is no indication that it is prepared to run the necessary persistent balance of payments deficit to challenge the position of the dollar.
I find a lot of the points you make compelling on a paradigmatic (not dogmatic) level, but there is one howler — forgive the term — that cries out for correction: you say the US dollar settled into its slot as a global default (reserve) currency in the 1970s. That is actually — to my understanding — the opposite of what happened. The dollar was effectively a global reserve currency from the inception of the Bretton Woods system of regulated international exchange rates for Western currencies from 1944 till the anarchic, unilateral dismantling of this system between 1971-1973, when the Nixon administration refused to convert dollars to gold, which was the anchor of the entire system. Dollars were pegged to gold. Other currencies were pegged to the dollar. After the oil shock in 1973, and the inception of inflation, the dollar was effectively allowed to float, without gold to anchor it, as Nixon had suspended the dollar / gold peg. So other currencies were forced to float also. The Europeans managed for about another thirty years to maintain a system of relative exchange rates fixed amongst themselves, with varying degrees of rigidity and flexibility. But the 1970s is when the dollar’s role as a global reserve currency effectively ended. The fact that it has maintained awe-inspiring privileges of seigniorage has more to do with the fact that many markets — capital markets, private equity markets, oil markets, bond markets, swaps, derivatives, equity markets, etc. — all operate in dollars, and those markets are global. The dollar remains dominant because those markets have awe-inspiring global scale and depth in terms of sheer liquidity. They have their own momentum and they make their own weather. But — and this is where your argument picks up again — these markets are now almost wholly disconnected from the standard of living and day to day economic reality of millions of Americans. That is the struggle. One brilliant answer would be unions, which dominated the very same thirty-year period in which the U.S. dollar was actually the dominant global currency. That was — not paradoxically — when unions also steered a much larger share of the US labour force. Labour and capital were not adversarial to the degree they are now. Now, they have unconsciously uncoupled and they have no prospect to reunite. That’s fairly tragic.
Karl Marx’s great error was in failing to see that, as the state expands, it creates a new class more rapacious and less productive than any capitalist bourgeoisie or landed aristocracy.
It is the sheer weight of the rent-seeking class that is sinking the West.
“Iacta alea est”.
Orwell writes about those unproductive people who live of dividends and provided rentiers and flaneurs of post WW1 Britain and Paris. This group have morphed into the the large number of white collar workers who serve little purpose employed by the state and even private organisations in some form or other: local and national civil service, teaching many humanities courses in schools, academics in the humanities, bureaucrats in arts and cultural institutions, diversity and human resources personnel, etc . It is the organisational equivalent of middle aged spread.
Robert Michels saw this and C Northcote Parkins in his books Parkinson’s Law, In Laws and Out Laws and laws of The Profits made a fortune mocking the growth of administration in the late 1950s. Parkinson Book East West and Sir John Glubb’s Fate of Empire give far better insights into the rise and decline of Empires. Parkinson and Glubb combine vast and broad ranging experience with superb scholarship, both qualities tending to be lacking in most writers today.
“Iacta alea est”.
Orwell writes about those unproductive people who live of dividends and provided rentiers and flaneurs of post WW1 Britain and Paris. This group have morphed into the the large number of white collar workers who serve little purpose employed by the state and even private organisations in some form or other: local and national civil service, teaching many humanities courses in schools, academics in the humanities, bureaucrats in arts and cultural institutions, diversity and human resources personnel, etc . It is the organisational equivalent of middle aged spread.
Robert Michels saw this and C Northcote Parkins in his books Parkinson’s Law, In Laws and Out Laws and laws of The Profits made a fortune mocking the growth of administration in the late 1950s. Parkinson Book East West and Sir John Glubb’s Fate of Empire give far better insights into the rise and decline of Empires. Parkinson and Glubb combine vast and broad ranging experience with superb scholarship, both qualities tending to be lacking in most writers today.
Karl Marx’s great error was in failing to see that, as the state expands, it creates a new class more rapacious and less productive than any capitalist bourgeoisie or landed aristocracy.
It is the sheer weight of the rent-seeking class that is sinking the West.
Though the article is based on sound reasoning, I expect the demise of America will be decades in the future or not at all. Though China has the potential to surpass the US, it has yet to demonstrate the reality.
America has demonstrated the ability to change rapidly like no other country. Unless China demonstrates overwhelming economic superiority and financial reserves, that will not change. None of the this will change until the world has more confidence in China than the US(COVID anyone?).
Correct. But if you’re not Chinese ethnically, you’re only ever going to be a vassal, as an individual, or a tributary state, if you are a nation. That might not be so bad, for a while, but China’s historically long and deep roots in centralized administration includes periods of violent upheaval and chaos, because of weak change management norms. So you are right Michael, America’s main hope comes from it’s more shallow roots and its associated ability, at least up to now, to cope with change to its relative advantage.
Correct. But if you’re not Chinese ethnically, you’re only ever going to be a vassal, as an individual, or a tributary state, if you are a nation. That might not be so bad, for a while, but China’s historically long and deep roots in centralized administration includes periods of violent upheaval and chaos, because of weak change management norms. So you are right Michael, America’s main hope comes from it’s more shallow roots and its associated ability, at least up to now, to cope with change to its relative advantage.
Though the article is based on sound reasoning, I expect the demise of America will be decades in the future or not at all. Though China has the potential to surpass the US, it has yet to demonstrate the reality.
America has demonstrated the ability to change rapidly like no other country. Unless China demonstrates overwhelming economic superiority and financial reserves, that will not change. None of the this will change until the world has more confidence in China than the US(COVID anyone?).
An interesting read. Surely one thing everyone can agree on is that every empire eventually collapses? It does seem though that there is a type of person who is gleefully sitting back in his recliner with his oversized bucket of popcorn waiting to see the immediate collapse of the USA – I feel they might be need a few refills.
An interesting read. Surely one thing everyone can agree on is that every empire eventually collapses? It does seem though that there is a type of person who is gleefully sitting back in his recliner with his oversized bucket of popcorn waiting to see the immediate collapse of the USA – I feel they might be need a few refills.
“It happened because, as the dominant nation, the US imposed unbalanced patterns of exchange on the rest of the world, and these funnelled a disproportionate share of the planet’s wealth to itself.”
This statement at the start of the article begs a lot of questions. What are ‘balanced patterns of exchange’? On what basis do we ‘balance’ the raw materials used in production with the scientific knowledge and skills that turns these materials into cars and planes? It is easy to make an argument that the exporters of raw materials should be grateful that they benefit from these inventions in return.
What is ‘wealth’? I think the author means ‘natural resources’. Many metals were worth no more than the dirt in which they are buried until inventions created demand for these natural resources.
Best comment so far.
I don’t recall the United States stealing the natural resources of other countries nor did it force the world to purchase automobiles, electronics and the entertainment it produced. The U.S. is indeed bankrupt, but in a moral sense more than economically.
How long ago was it that other nations bought American automobiles and electronics? Can’t remember anything in the last 30 years I’ve bought that was made in the USA. iPhone made in China doesn’t count.
…it does count actually Peter, because the manufacturing cost is a small component.
…it does count actually Peter, because the manufacturing cost is a small component.
Agreed – best comment so far – and also about the abides administration and the constituency “it” represents are morally bankrupt.
Yes it is close to becoming spiritually bankrupt. The spirit of the pioneer is nearly gone and the one of the victim has replaced it.
How long ago was it that other nations bought American automobiles and electronics? Can’t remember anything in the last 30 years I’ve bought that was made in the USA. iPhone made in China doesn’t count.
Agreed – best comment so far – and also about the abides administration and the constituency “it” represents are morally bankrupt.
Yes it is close to becoming spiritually bankrupt. The spirit of the pioneer is nearly gone and the one of the victim has replaced it.
“begs lot of questions”. You are too kind. I stopped reading after that line as it clearly labels the author as afflicted with the same old retro-socialist economic ignorance as your typical liberal arts college Occupy Wall Street activist. If you don’t understand that free trade is not theft, then you have nothing to share with us.
Ditto. I think Peter Zeihan’s idea that the US became rich due to free markets, lits geographical position, its fertile midwest soils providing food for the industrial coastal areas, its vast uninhabited spaces, its natural resources and not needing an “empire” as it already had everything it needed to prosper within its own borders, is far more compelling than the idea it stole wealth from other parts of the world.
Ditto. I think Peter Zeihan’s idea that the US became rich due to free markets, lits geographical position, its fertile midwest soils providing food for the industrial coastal areas, its vast uninhabited spaces, its natural resources and not needing an “empire” as it already had everything it needed to prosper within its own borders, is far more compelling than the idea it stole wealth from other parts of the world.
Best comment so far.
I don’t recall the United States stealing the natural resources of other countries nor did it force the world to purchase automobiles, electronics and the entertainment it produced. The U.S. is indeed bankrupt, but in a moral sense more than economically.
“begs lot of questions”. You are too kind. I stopped reading after that line as it clearly labels the author as afflicted with the same old retro-socialist economic ignorance as your typical liberal arts college Occupy Wall Street activist. If you don’t understand that free trade is not theft, then you have nothing to share with us.
“It happened because, as the dominant nation, the US imposed unbalanced patterns of exchange on the rest of the world, and these funnelled a disproportionate share of the planet’s wealth to itself.”
This statement at the start of the article begs a lot of questions. What are ‘balanced patterns of exchange’? On what basis do we ‘balance’ the raw materials used in production with the scientific knowledge and skills that turns these materials into cars and planes? It is easy to make an argument that the exporters of raw materials should be grateful that they benefit from these inventions in return.
What is ‘wealth’? I think the author means ‘natural resources’. Many metals were worth no more than the dirt in which they are buried until inventions created demand for these natural resources.
The author lost me when he said it was clear by 1930 that world domination was clearly between the US, Soviet Union and Germany. In 1930 the Soviet Union was starving millions to death. Germany was a basket case and the US was locked into a period of isolationism again. So no.
Agreed. Whilst Germany had a few large international industrial champions, it was seriously underdeveloped and still largely agrarian. GDP per capita and gross (modern estimates as GDP figures were not a thing) for the period show a huge gulf between Germany and the USA. The book “The Wages of Destruction: The Making and Breaking of the Nazi Economy” provide a good statistical background for the period.
There was only one conclusion for those who’d seen the USA’s industrial capacity (even in the midst of a depression), one shared by many at the time including a certain Winston Churchill: the USA was going to be a dominant power. And so it came to pass.
Things had changed somewhat five years later.
Agreed. Whilst Germany had a few large international industrial champions, it was seriously underdeveloped and still largely agrarian. GDP per capita and gross (modern estimates as GDP figures were not a thing) for the period show a huge gulf between Germany and the USA. The book “The Wages of Destruction: The Making and Breaking of the Nazi Economy” provide a good statistical background for the period.
There was only one conclusion for those who’d seen the USA’s industrial capacity (even in the midst of a depression), one shared by many at the time including a certain Winston Churchill: the USA was going to be a dominant power. And so it came to pass.
Things had changed somewhat five years later.
The author lost me when he said it was clear by 1930 that world domination was clearly between the US, Soviet Union and Germany. In 1930 the Soviet Union was starving millions to death. Germany was a basket case and the US was locked into a period of isolationism again. So no.
Seems that the author actually wants these events to take place in some kind of perverse schadenfreude.
I can never spell schadenfreude
Capital ‘S’ because nouns in German begin with capitals.
My case rests.
The capital ‘S’ does not have to be used when using English…..
Hun? Bosche?
My case rests.
The capital ‘S’ does not have to be used when using English…..
Hun? Bosche?
The German’s have a word for that
Nichtablespellen
You seem to have caught the greengrocer’s apostrophe syndrome
You seem to have caught the greengrocer’s apostrophe syndrome