China is a Rich Society. No Western Country Is.

Dear Ian,

the picture of the “west” you painted is accurate; Europe, in particular the states of the European Union, is worse off than the USA. You offer two reasons for the european malaise: “it has recently chosen the path of de-industrialization and xenophobic isolationism”; the first one is evidently true, the second one is hard to comprehend. Germany for example destroyed its industrial base through a suicidal energy policy (wind and solar only as a goal without having cheap energy storage and a proper network system), through the silly “debt-brake” (Merkel and her minions put this idiotic “brake” even in the constitution), through pouring billions of Euros in “saving” Banks and Assurances during the financial crisis 2007/08 and the socalled “euro-crisis” 2011-15 and through the completely insane sanctions against Russia. The logical result of all this: the car industry is in a deep , maybe in a deadly crisis, even the legendary mechanical engineering sector is battered by the manufactured recession, the chemical industry is going to relocate business to East Asia and/or the United States; unemployment is on the rise, cities and municipalities are bankrupt, pension and healthcare system are short of failing and breaking down. Since 2015 (and Merkels fatal decision to open the borders) Germany took up roundabout 6 – 7 million people (the greatest part of them from Syria, Iraq, Afghanistan and the Maghreb region) when at the same time the german government decided to wreck its economic system. Please explain me: where do you see “xenophobic isolationism” and what is the logic behind simultaneously destroying deliberately the own economy and taking up 6 – 7 million mostly young and poorly educated men?

Technological, industrial civilisation is not the future. It’s just humans destroying the natural world.

Evaluating the relative, arbitrarily defined levels of socioeconomic success of Western Democracy and Eastern Authoritarianism is like comparing Apples to Earplugs. Number of publications? Most of it (even Western) is likely fraudulent or junk. Patents? Anyone can apply. University enrollment? Proportional to population size.

So it’s not clear what theory you are hoping to erect building on such shaky ground.

Keep in mind that if the West cannot keep their perches by delivering better goods, services, etc., simply smashing China up is the next option.

On LinkedIn I get into occasional exchanges with Trumpists who argue for tariffs and talk about “China!” but shut up when you say “Well, if China is eating our lunch, why don’t we copy what they’re doing?” Because they realize that copying the good parts of what China is doing would take the US in the opposition direction they want to go.

They either shut up, or they (more usually) fall back into rants about recreating the late 19th century US, with its 1 % per capital growth rates (ooh! ahh!), prolonged depressions lasting most of a decade with an estimated 10-15 % unemployment, and panics created purely by currency fetishes. But hey, the rich paid almost no taxes, and freely bought the government, so I guess that’s their motivation!

China is not going to continue to “use and develop every possible energy source”. They are engaged in a transition, and fossil fuels are going to go the way of the dodo there. I suspect that some time after the fossil fuel situation is largely resolved, there will be a sorting out of nuclear . . . which will probably result in there still being approximately as much nuclear as China wants to facilitate materials for nuclear weapons, but not much more.
“Use and develop every possible energy source” is a stupid approach. So for instance, we don’t still use whale oil for light, because it’s too expensive to hunt down freaking whales when we can just use electricity. The thing is that (renewables + storage + maybe something stable like hydro, nuclear or geothermal) is increasingly way, way cheaper and more efficient than fossil fuels. Every use of fossil fuels isn’t a free extra, it’s an opportunity cost . . . and if you can MOSTLY replace it, you should as much as possible COMPLETELY replace it so you can cut out maintaining the expensive infrastructure for moving it around.

It LOOKS to a quick glance right now as if China is taking an “all of the above” approach just because of the way compound/exponential growth works. Up to now, China’s compounding economic growth has exceeded the growth in use of things like solar power or EVs or whatnot. So solar power, for instance, has just been replacing some of the growth in coal plants or natural gas ones, but not reducing their actual numbers. But the exponents on those are much BIGGER. China’s economy has been growing at like 5%/year. Solar and wind power use and EVs have been growing from a tiny base, but at like 30%/year. But we are about at the stage where they grow faster than the overall economy . . . EVs already passed it. And once you reach that point, things start shifting fast; every 30% takes a bigger and bigger bite out of whatever the 30% growth thing is replacing. In three years there will barely be any fossil fuel cars other than plugin hybrids sold in China. The fleet will take longer to shift, but it’s inevitable once nobody’s buying ICE cars. OK, that’s EVs, but it’s just a few years earlier on the curve than solar power. Fossil fuel use is going to start declining decisively in China, and it is going to start soon.

As to Germany, this is the first time I’ve ever seen anyone except the occasional MAGA-ish type trace their economic woes to uptake of renewable power. Indeed, it’s one of the few times I’ve ever seen anyone say that seriously about any jurisdiction. The only time I’m aware of where there was some truth to claims about the ills of heavy adoption of renewables was with wind power in Ontario . . . but that was all about crony capitalist corruption and sweetheart deals, rather than the type of power itself. So I’d want some evidence before I considered believing it.

Note that while China is doing a lot of things right, and, if leadership does not get couped by their own oligarchy, will continue to do them better than the West, it will likely fall in the same trap that the US did.

Which is that in the first three decades of the 20th century the US built up a huge amount of not really necessary infrastructure with a limited lifespan, riding the oil boom high. But then that infrastructure has to be maintained and renewed, which fixes a floor on the resource investment needed to just stay in place. The US did have the resources to maintain its infrastructure, but chose to spend them on mansions and megayachts for its oligarchs instead. However, that does not mean that it will have those resources indefinitely, quite the opposite, because they are non-renewable, thus even if it did not waste resources on megayachts, mansions and private jets, it would still face this problem sooner or later.

China is in the same situation — they are doing the full build out of their infrastructure for the first time, but will they have the resources to do it a second time on the same scale 50-100 years from now? Quite likely they won’t, and nobody else will either. Despite all the investment into nuclear, renewables, technology in general, etc. In the end they are making the same mistake of investing too much into personal automobiles, even with all the roll out of high-speed rail.

When I see these magnificent highways weaving around and through mountains, I marvel at the ability of Chinese engineers, but I also have in the back of my mind the thought that this will all crumble due to concrete fatigue by the early 21st century, and it will have to be rebuilt. Same with everything else.

I have a sneaking suspicion that the EU’s military build up has little to do with Russia in any real sense. I don’t think even the lackluster leadership class that is in control of the EU is that stupid to think they are in any position to fight Russia. I have a sneaking suspicion that instead the EU wants an army to sic on any member states that get out of line.

At least some of them are probably just trying to do military Keynesianism because the real kind is forbidden. The problem is, the military kind has a bunch of crappy side effects and spending on modern military stuff doesn’t have nearly as much effect as military spending used to in the old days.

Yeah, that’s the fundamental reason the fascist right is surging: You can’t completely conceal from people that something is wrong. They feel it, they fear it. Too many people with too crappy of lifestyles, too many homeless, too many close to it. And for that matter, there’s the contradiction going: The top dogs want everyone to believe in the system, but they ALSO want them to be afraid: Afraid of what happens if you lose that job, so you don’t get any ideas about pushing for better conditions. The more that works, the more people feel uneasy.

So lots of people want SOMETHING to change. But they’re too propagandized for the most part to question the fundamental things that REALLY need to change. So they’re totally vulnerable to lines of patter that tell them something else is wrong, something easier. The solution on offer that purports to be radical, and taps into the fear and anger, but doesn’t actually challenge any of the important things that would be heresy to question, is fascism.

I have been contemplating a thought experiment of late: What if Chinese researchers make a breakthrough in low temperature fusion reaction or harvesting zero point energy at scale? How would Western oligarchs react to this, as the Chinese would share this tech with the rest of the world? Is this what Thiel and the gang really fear?

GM
“but I also have in the back of my mind the thought that this will all crumble due to concrete fatigue by the early 21st century, and it will have to be rebuilt. Same with everything else.”

It is actually good. I lived in a house built in 1875 in a major US city in a college neighborhood. The house was situated well for my commute, but I wished it fell apart and was rebuilt, instead of swaying at night for unknown reasons — porous, rotten, uncomfortable, infested with cockroaches and mice. By the time the Chinese infrastructure decays, the technology will move forward, new means of transportation may appear — maybe they will not even need those roads and bridges.

Entropy is a profound quality of the universe we will in. Everything deteriorates, including us. Everything needs repair and upkeep — should we just stopping building because the universe unbuilds? The sun will become a red giant and swallow the Earth, the universe will begin collapsing and contracts into a nothing — should we just end ourselves now, because what’s the point?

Cognition involves effort, a willpower to force oneself to think — sort of like the effort to run (look up The controllosphere: The neural origin of cognitive effort. CB Holroyd – Psychological Review, 2024 on this). Making this cognitive effort is unpleasant and inherently aversive (see The unpleasantness of thinking: A meta-analytic review of the association between mental effort and negative affect). My diagnosis of the West is that it lost the willpower to force itself to do hard thinking (like in engineering) and indulges in mental activities that require least effort (e.g., finance, what is ever new there?). It is hard to change, so we curse the Chinese with entropy…