Category: Economics Page 26 of 93

On December 28, 2020

Cases have been found outside of Britain, including in the US and, ironically, France (slammed the door too late.) The practical result of the increased infectiousness are discussed by Tomas Pueyo.

The points are, as you’d expect, that it increases the speed of exponential growth. If it becomes the dominant strain (and it almost certainly will, because it grows faster), you have to really lock down. No sham lockdowns, people don’t go out for anything but food (maybe you even deliver that); schools are closed, no one works outside the house unless they truly are an essential worker.

Herd immunity now requires 75 percent+, not 60 percent of the population. That means it will take longer, and with respect to vaccines, people will need to be convinced to take them, or if necessary, forced to.

Countries that already got Covid-19 under control, like Vietnam, New Zealand, China, and Taiwan (notice a trend?) will be fine. They just keep tracking and tracing; keep quarantining visitors, and keep clamping down hard on even a hint of a break-out. Those of us who haven’t, like most of Europe, the US, Canada, Brazil, and so on, can either get serious RIGHT now and close schools and go to a real lock down, or we are going to have to wait for vaccine immunity, which may take until the end of 2022 depending on how many doses your country is getting and when (and if people will take them, or be forced to).

In general terms, my sense is that the first half of 2022 is going to be worse than 2021 in countries that have fumbled Covid, after that things should start improving noticeably.

This was a pro-active choice by our elites: They decided not to handle Covid. It was handled in many countries, the playbook is known to anyone who cares to know it just by seeing what was done or reading a 101 textbook, but “fumbling” Covid made elites in countries like the UK, Canada, and the US a lot richer and more powerful, so it was allowed to rage through the population and destroy the small business economy so that those who were able to stay open, like Amazon and Apple, and so on could grab huge amounts of market share.

Grandma died and young people got life-long heart problems so Jeff Bezos and private equity scum could get richer.

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You Can’t Buy Anything That Matters When It Matters (Covid Vaccine Edition)

On December 12, 2020

… unless you have control over the production facilities.

Rich countries will get access to coronavirus vaccines first – for poorer ones, the timeline will stretch until 2024 (at the earliest) pic.twitter.com/UgLieumAFr

— Agathe Demarais (@AgatheDemarais) December 11, 2020

I think this map is a little inaccurate, but it makes the point. Money matters, yes, but having control over vaccine manufacturers and R&D matters more.

This is true of everything. Oil is not a global market if there are ever shortages decision makers care about. FOOD is not a global market if there’s ever a worldwide shortage, and countries which net import will find that out. (The Irish famine, where Ireland, then an imperial colony, continued to export food even as its people starved, underlines the word control.)

Global markets are OK for things that don’t matter. For anything that does matter you want manufacture, R&D and supply lines concentrated in your own country or that of true close allies. In those cases, you want mutual vulnerability. If country A has it all and is a close ally, that won’t work when they’re desperate, you have to have part of the dependencies.

Even this doesn’t work completely. It was very popular before WWI to state that a big European war couldn’t happen because of how interdependent the economies were.

Yeah.

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It does help.

Industrial policy means that if you can, you make it at home, and if it costs a little extra, too bad, slap on a tariff. If you control natural resources, you NEVER sell them raw if you have any choice. The history of England’s economic development leading to the Industrial revolution starts with a ban on selling English wool to mainland Europe, allowing them to build their own textiles industry. Of course, those textiles were worse than what Flemish weavers would have made, and less efficient to start, with higher prices. The English, correctly, did not care. They had the wool, and there wasn’t a huge surplus of wool. Buy the clothes from us or no one.

Food, water and essential goods: if it is at all possible you want to be self sufficient in all three. In sensible countries a great deal of geopolitics is driven by this when a country can’t do it all internally. China knows, for example, that the US can shut down the Strait of Malacca any time it wants, crushing their oil supply and that is a major reason why they are creating a huge land route all the way across the Asian continent, and getting snuggly with the Russians (who can supply oil by land.)

Chinese economic policy, letting Westerners get super rich by producing goods in China, was also driven by this. The Americans aren’t wrong, the Chinese were super-aggressive about technology transfer. The deal was often that in order to get access, you had to give them the tech. If you wouldn’t, they would try and steal it (Americans stole a ton of British IP back in the day, don’t get all pious, everyone does it.) There was also technology-arm breaking creep. Sure, you gave us a tech a few years ago, but what have you given us recently, and why should we allow you to stay in our market today?

Foolish nations, like Canada and the US, let key industries go overseas, or sell raw materials without processing. Wise countries don’t, unless they’re getting something very worth it in return. Getting a bunch of new rich people who made their money by selling your country out isn’t “worth it” to anyone but the rich people and the politicians they bribed.

Money doesn’t cut it. Per capita Canada bought more Covid vaccines than anyone else, but notice that Canadians won’t be in the first wave to get mass vaccination. This is a “white, 1st world” country, and it can’t buy its way in. (The case is a bit more complicated than that, because the government are incompetent, but we’ll leave it there for now.)

If it isn’t on your territory, where your people with guns and your bureaucrats have power, you don’t control it and when it matters, you can’t buy it.

Twelve Million Renters To Be Homeless Soon Because It Benefits the Rich

On December 9, 2020

And so we are where knew we would be:

Nearly 12 million renters will owe ~$5,800 in back rent and utilities by early January.

This was predicted regularly: people lost their jobs, they got one $1,200 and improved EI benefits for a while, and that’s pretty much it. Eviction protection is nice, but it doesn’t pay the rent and ends. This was 100% predicted and predictable, your lords and masters knew it was happening and would happen.

Oakland Homeless Encampment

They could easily have stopped it, and chose not to. The Fed and Treasury and Congress bailed out rich people, and their wealth has skyrocketed. Meanwhile New York wants to put a tax of $3 on deliveries of anything but food and medicine to bail out the subway system; taxing the poor and middle class rather than the rich who made out like bandits.

The money to fix this is fairly trivial. 69,600.000,000 – about sixty-seven billion dollars. In context, the TARP bailout for rich people was 700 billion back in 2008. The Federal reserve, by some calculations, floated about 20 trillion dollars. Seventy billion isn’t even real money in the modern world.

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It does help.

But when renters can’t pay rent, the landlords will go bankrupt, and the actual rich will buy up the properties. Meanwhile desperate unemployed people keep wages down and ensure that current workers will do anything they are told with no back talk, because they know there are way fewer jobs than workers. Win/win/WIN.

If you’re rich.

So, if you’re going to be homeless, or lose the property you rent, rest assured it’s in the cause of allowing the rich to control even more of the economy, gutting small and medium landlords and small and medium businesses (who have had to shut down, while companies like Amazon and large retailers make mint.)

Your leaders impoverish and kill you for money. That is all. Wouldn’t want you to think this is for no reason at all or because of incompetence. Your poverty and desperation does help somebody, and that’s why it is happening.

The Fortune of the Commons

On December 7, 2020

There is a theory, called, “the tragedy of the commons” that if no one owns something, it will be overused.

You can see this in pollution. No one owns the air, so assholes over-pollute it because they get the profits and bear only a tiny part of the costs. When I was young the BC coasts had tons of clam and oyster beds. In the 90s people with no connection to local communities (Vietnamese) came along and stripped them clean. Made a lot of money, but destroyed most of the beds.

The problem is that these aren’t “commons”.

Commons are resources a community or group in the community manages together. The air and oyster beds weren’t managed.

The commons, in England and elsewhere, lasted for well over a 1,000 years. They were managed well, were over 90% as productive as enclosed fields and produced a far better standard of living for more people than enclosed fields, which were associated with throwing people off the land they had lived on for over a thousand years, so they could work over 80 hours a week in factories with horrific rates of dismemberment, in cities rife with disease where people died far younger and were ill far more often.

There is no tragedy of the commons.

The Commons, when handled correctly, never plays out as Tragedy. Here a 1482 example from a Swiss Alp community in a book by Ruth DeFries. pic.twitter.com/OnGIxPOHmD

— Wrath Of Gnon (@wrathofgnon) December 3, 2020

What we call commons, aren’t. To be a commons, a group of people which benefit more from the continued existence of something than its destruction or degradation have to be charge in it. No short-termers or outsiders (people who don’t need it to continue in their lifetime and beyond) need apply. In the terms of Carse’s “Finite and Infinite Games” no one playing a finite game can ever be allowed close to a commons.

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It does make a difference.

The tragedy of the commons is that people who didn’t benefit from them continuing used the power of the state to break them up (enclose) them for their private profit, thus improverishing millions of people.

The modern tragedy of shared resources (which are NOT commons) is that the people in charge of them are playing finite games. My friend Stirling Newberry called this the death-bet. Simply put, the people fucking the world up with massive pollution and over-using resources, will be dead when the bet comes due. Nancy Pelosi, clinging grimly to power, is 80 years old.

The people you want in charge are people who are young and people who care about their great-grandchildren. Or, in the Haudenosaunee (Iroquois) phrase, for the next seven generations.

As for old people, the problem is twofold: first they think their money will help their kids, second they don’t /really/ care about their children or grandchildren. (Based on the behaviour I see, I assume most Americans don’t actually care much about their kids, especially once they’re adults. They scream that they do, but their actions show otherwise.)

They also have to be, for types of commons which are not global, locals, so that they can’t leave when things go bad. People who aren’t committed to the local area can’t be in charge of the long-term sustainability of a local area.

Put crudely, people who don’t have to eat where they shit can’t be in charge of anything.

Because this isn’t always possible, with global resources, you need to put people in artificial boxes. They need to experience the consequences of their failures. If they have both authority and power to act, after a certain time in office (and when out of office for a certain amount of time, so they don’t dodge their failures) they need to eat their own dogfood, to use the business expression. Make them live in the place with the worst pollution. If there are people there without a mask, then they don’t get to have one either. Make them drink the water. Make them eat the fish from the river.

This sort of personal responsibility, if combined with actual power, will clear problems up fast. If you want to make it really potent, give them a bit of time then make their non-adult children do the same.

In India there is a longstanding problem, not primarily environmental, but similiar, called manual scavenging. Simply put, untouchable (Dalit) caste members clean sewers and so on manually. No other jobs are available to them.

If you simply made it so that the governor and police chief and Prime Minister all had to do a day of manual scavenging every week till there was no manual scavenging (or so close to none as to unmeasurable) I guarantee this problem would be solved so fast your head would spin.

As for heads of industry, making the Shell CEO and every executive and all major shareholders eat fish from the Gulf oil spill for a year would be laudatory.

No wealth or power without responsibility for results. None. No scapegoats. If you have power, you’re in charge, no saying someone is responsible without giving them necessary authority.

The Ganges, in India, is horribly polluted and Indian politicians constantly wail, promise to do something and do nothing. Make them drink it every day, in front of witnesses, and the problem will resolve itself. (Sure, there can be some time lag. But perhaps make them drink one glass at the start of their term of office. Concentrate the mind a bit.)

No one gets to be in charge of anything unless they are affected by the results of their actions. Nothing.

This may seem similar to “Skin in the Game” by Taleb, but it is an ancient idea. Even in modern thinking, before Taleb, Jared Diamond made the same point in his book Collapse. But the idea is as old as civilization, and I am quite sure older.

As for the generational altruism idea, the ancient Greek saying was “a society is great when old men plant trees in whose shades they will never sit.”

We know all this, but in the modern era bunch of people who were either fools or evil or both, starting with Adam Smith (who was, admittedly, not quite as bad as his idea’s misuse would lead one to believe), created the idea that governing the world based on short term greed would lead to good results.

It did, for some people, and for a larger group for a while (that while is coming to an end.) It was based on genocide, enclosure (aka the violent removal of property rights from peasants) and the conquest of 70%+ of the world.

Or, if you want another authority, Keynes,

Capitalism is the astounding belief that the most wickedest of men will do the most wickedest of things for the greatest good of everyone.

Put that way, it’s pretty obviously nonsense.

The Tragedy of the Commons is that we don’t have properly constituted Commons, that is all.

The Rise of the Guillotine

On December 3, 2020

There was a time when almost no one would have put forward anything like the below, today, guillotine references are routine.

Today’s parents have forgotten that children’s play should teach them how to be responsible adults. pic.twitter.com/bGprm9rv09

— Will works for the working class (@ClassFirster) December 3, 2020

Back in the 2000s, I spent a fair bit of effort advocating for policies to help the majority of Americans and Westerners by pointing out to the wealthy and powerful that, historically, sometimes oppression ends very very badly. This effort failed abysmally, as have other similar efforts, sometimes by the brighter and more forward looking of our inbred overlords.

Fast forward to today, and these sorts of images are everywhere. What was once verbotten, because the Terror is taught to everyone to be the worst thing possible and the French Revolution as the bad revolution (as opposed to the American revolution, which was supposedly good, unless you were a slave or a native).

The terror was, well, a TERROR. The revolution did not last, but the vast majority of those who ruled pre-revolutionary France did, indeed, die. When the allies won, despite their attempts, the Bourbon restoration was a failure. The people necessary to have made it a success, were, simply, dead.

As I have noted a few times here, the Terror was less terrible than the millenium of oppression that came before it. For those who need the point spelled out in angry detail, Mark Twain has you covered.

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At any rate, Western elites have continued this process. Huge swathes outside the core of Paris are, I am told, essentially third-world slums. Vast numbers of Americans have been driven into poverty and homelessness and huge tent cities spring up, and then are cleared by police in the most punitive way possible (destroying homeless peoples’ possessions), but then spring up again, because what the hell are they supposed to do?

The middle and even the lower upper class lives in terror of falling out of their comfortable spot into the lower class or homelessness. Covid has vastly enriched the already rich and about triple decimated small businesses, while throwing further millions into poverty.

Americans are now willing to vote for men on horseback types, Trump proved that, even if he was a fake, a blowhard and essentially incompetent at anything but campaigning (which he was very, very good at, and if he hadn’t fumbled Covid, I am confident he would have been re-elected).

People are tired. Younger generations like the Millenials and Zoomers have never seen good times, and even X-ers only got a whiff of them, with most never having been part of them. The dotcom boom was short, and passed a lot of people by entirely. Same with boomlets like the Massachussets miracle.

The standard way to deal with the hoi polloi is to split them into groups and make them compete with each other. Our elites have dutifully run this playbook, and sometimes even very well, but as there is less and less upward mobility, less and less chance of being one of the blessed few (mobility has collapsed), this becomes harder and harder to pull off. People stop thinking they’ll ever get ahead, stop seeing the guy or gal next to them as the problem and look up towards the top to see who’s really oppressing them.

Add in the joy of climate change added to normal imperial decay and generational economic cycles and you have a triple whammy slouching down that road, baring its thousand mouths dripping with blood.

There was a possibility for a gentle revolution. For a sweet, kind, caring redistribution of wealth; a gentle and careful breakup of power and wealth, leaving the wealthy still rich, but not obscenely so, still powerful but not an oligarchy.

If that was going to happen, Corbyn would be Prime Minister (instead of virtually thrown out of the party, as Labor leader Starmer continues his purge of the left), and Sanders would likewise be President. Everything necessary was done to make sure neither of those things would happen, that the gentle revolution would die aborning. There will be no rebirth of the great society of the post war period, with environmental protection and equality for women and minorities added.

This being so, there will either be a steady state police-surveillance state, abetted by modern company store serfdom, keeping people in eternal debt and despair, or there will be revolution. That revolution may come from the right, or from the left. If it comes from the right, the oligarchs will mostly be okay, a few stupid ones will be made examples of (as Putin did with Russia’s oligarchs), the others will bow, patronage will go to the half of the poor willing to kill the other half, and life will continue.

If it comes from the left, well, the rich are right, that’s the real danger. At best they will lose everything, at worse, well, those guillotine memes tell you their fate. Machiavelli understood this, and he was right. When you hurt a man you must destroy him entirely: He must have no power left at all, or he will take vengeance. The left cannot tolerate oligarchs or anyone who was willing to work for them who does not jump to the left’s side immediately as the revolution begins.

Hopefully, it won’t be a Terror, but it may be, and it may be because people are terrified already and they want their overlords to feel what they have felt, to know despair and fear and hopelessness. They want revenge, and indeed, something that is close to justice, because their overlords, as Covid has demonstrated, have been killing them and impoverishing them for money for a couple generations now.

The guillotine is a symbol of the fact that the powerful aren’t always the only ones who may inflict terror.

If our elites were in any way wise, they would back down, but they are not, and so the guillotine will rise ever higher in our collective consciousness until, perhaps, it reaps its bloody harvest once again.

Abundance Mindset, Scarcity Economies and the Great Game Of Musical Chairs

On November 29, 2020

Like a lot of older Gen-X I remember the good times without having every participated in them. By the time I was an adult stagflation, the Federal Reserve, Reagan and Thatcher had done their work and the decline had begun. Everything kept getting shittier for most people in the western world and it has kept doing so for about 40 years now. Depending on what group you’re in, it might be fifty.

This has given rise to a whole body of how to get rich works. They rival those of the gilded age: Napoleon Hill’s “How To Think and Get Rich” is a good example. (The best of them is still “How To Make Friends and Influence People,” its advice will work as long as humans are human.)

The catchphrase these days is “abundance thinking”. There’s a ton of good stuff in the world, and you just have to figure out how to get some. The world isn’t full of scarcity, it’s full of too much.

This is, of course, true. There are money spigots, like various central banks, early entry to crypto, being attached to important resource economies like oil (though that’s ending) and so on. There are people who have way more money than they need, for whom money is a trivial concern, a way of keeping score, and those who just have too little.

You want to move to a position of abundance. You want to find a spigot. On the right this selling is courses on how to get fit or slim or rich or whatever. Sometimes the courses are bogus, sometimes they’re pretty good stuff, but they price them high and find desperate people to buy them.

So it is, so it always has been. Sell the dream to desperate people and you’ll get rich. Attach to a money spigot and you’ll be fine. It’s why the fights are so savage these days. Corbyn in Britain threatened the money-spigot attachment of Labour elites and they hate him for it and will do anything they can to destroy him. Nothing was too low to do to stop Sanders, because he would have brought in his own administrative class into the Democratic party. Democrats used many of the same vote suppression tactics against Greens and Sanders as they squealed about Republicans using against them.

It’s all about position. This is why the standard advice in prosperity circles is to ditch your loser friends and hang out with successful people. They’re attached to some spigot, or have found some vein of insecurity to mine and they can cut you in or show you how to get in.

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But this is the larger issue: it’s all about position.

It’s a giant game of musical chairs. Some people are in abundance economies, other people are in scarcity economies (these have little to do with national economies, though it’s easier to get into an abundance economy in some places, obviously.)

But there are only so many money spigots and only so many people who can mine veins of insecurity. There aren’t enough good seats.

So the abundance stuff focuses on how you can become one of the winners, one of the people in an abundance economy. If you do it ethically, you help others get inside. If you do it unethically, you’re just a parasite and you reduce the number of prosperity chairs. (Jamie Dimon, for example.)

The issue with all this, even when done ethically, is that even the “good” guys are rarely increasing the number of seats in the abundance economy. They’re just redistributing who gets them.

In econo or math-speak that’s a zero sum game. But because most of the people attached to money spigots like the Federal Reserve are actually reducing the number of good seats, it’s actually a negative sum game. Every dollar someone like Dimon earns hurts other people.

Abundance thinking could be a good thing: there’s no reason the world can’t be abundant. I am perfectly aware of limits to growth, but every human could have a good life if we wanted them to. But right now it’s all about winners and losers. It’s about each of us, perhaps on team with the other “winners.”

You can win such games, of course, but they produce a world that is hell, and worse a world that keeps heading towards worse hells. This is how downward spirals happen: when we’re concerned only with a few people’s well-being, rather than the well-being of all.

Eventually the hell becomes so bad that practically everyone is in hell, with perhaps a few lords of hell still enjoying life (almost every post-apocalyptic story still has some people doing fine.)

This is the treadmill we’re on, as we seek to save ourselves from the horrible fates we see around us.

So we resort to “I see what it takes to be successful and I’m going to do it and I have those characteristics or can get them. I’m not a loser. I’m a winner!”

The worse things get, the more we focus on what it takes for individuals to grab onto a money spigot.

We grab a prosperity chair (or we don’t, I haven’t!) And that’s great, but the number of chairs relative to the number of people keeps going down, the carbon goes up, and every day more species go extinct.

And hell looms.

A solution that just works for a few is a solution: but it’s only a partial solution unless you don’t care about others, about the future, or about non-human life.

Not everyone, as we’ve designed the modern world, can live in an abundance economy.

Perhaps we should try for a world where people don’t have to do everything just right, or be born to wealth, to live well?

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Know Your Enemies

On November 23, 2020