Over at the Washington Post, Charles Kenny has a provocative op-ed arguing that China’s GDP will almost certainly soon surpass America’s in absolute terms, and this is to the United States’ benefit (the op-ed is based on Kenny’s new book, which can be purchased here).
Kenny’s first argument in support of this claim is that Americans’ quality of life will still be better than their Chinese counterparts, and that in fact “losing the title of largest economy doesn’t really matter much to Americans’ quality of life.” Fine.
Kenny next concedes that there may be some negative effects, but nonetheless argues that these are limited. For example, he notes that the dollar may no longer be the world’s reserve currency, but “businesses in the rest of the world still manage to export, even though they must go through the trouble of exchanging currencies.” Similarly, while having the largest GDP has allowed America to maintain the largest and most powerful military, “how much [has] the three-quarters increase in defense spending between 2000 and 2011 enhanced America’s well-being?” Thus, lower defense spending could be a net positive.
Kenny goes on to list a number of benefits America will receive from its relative economic decline. For example, this relative decline “is mainly a result of the developing economies becoming larger, healthier, more educated, more free and less violent. And there is little doubt the United States benefits from that,” such as through increased exports and being able to import the amazing new innovations these newly empowered countries will no doubt invent. Moreover, economic growth in the developing world “also means that there are more places for Americans to travel in security and comfort.”
There’s no doubt some truth to at least some of this. Most notably, China having a larger GDP will not equate to a better quality of life for Chinese people, and, I suppose, having more vacation spots to choose from also could bring some amount of joy to the top 1% of Americans who get bored of laying out on the same hundreds of beaches they currently feel safe to vacation in.
Still, China’s relative rise and the United States’ relative decline carries significant risks, for the rest of the world probably more so than for Americans. Odds are, the world will be worse off if China and especially others reach parity with the U.S. in the coming years.
This isn’t to say America is necessarily as benign a hegemon as some in the U.S. claim it to be. In the post-Cold War era, the U.S. has undoubtedly at times disregarded international laws or international opinions it disagreed with. It has also used military force with a frequency that would have been unthinkable during the Cold War or a multipolar era. Often this has been for humanitarian reasons, but even in some of these instances military action didn’t help. Most egregiously, the U.S. overrode the rest of the world’s veto in invading Iraq, only for its prewar claims to be proven false. Compounding the matter, it showed complete and utter negligence in planning for Iraq’s future, which allowed chaos to engulf the nation.
Still, on balance, the U.S. has been a positive force in the world, especially for a unipolar power. Certainly, it’s hard to imagine many other countries acting as benignly if they possessed the amount of relative power America had at the end of the Cold War. Indeed, the British were not nearly as powerful as the U.S. in the 19th Century and they incorporated most of the globe in their colonial empire. Even when it had to contend with another superpower, Russia occupied half a continent by brutally suppressing its populace. Had the U.S. collapsed and the Soviet Union emerged as the Cold War victor, Western Europe would likely be speaking Russian by now. It’s difficult to imagine China defending a rule-based, open international order if it were a unipolar power, much less making an effort to uphold a minimum level of human rights in the world.
Regardless of your opinion on U.S. global leadership over the last two decades, however, there is good reason to fear its relative decline compared with China and other emerging nations. To begin with, hegemonic transition periods have historically been the most destabilizing eras in history. This is not only because of the malign intentions of the rising and established power(s). Even if all the parties have benign, peaceful intentions, the rise of new global powers necessitates revisions to the “rules of the road.” This is nearly impossible to do in any organized fashion given the anarchic nature of the international system, where there is no central authority that can govern interactions between states.
We are already starting to see the potential dangers of hegemonic transition periods in the Asia-Pacific (and arguably the Middle East). As China grows more economically and militarily powerful, it has unsurprisingly sought to expand its influence in East Asia. This necessarily has to come at the expense of other powers, which so far has primarily meant the U.S., Japan, Vietnam and the Philippines. Naturally, these powers have sought to resist Chinese encroachments on their territory and influence, and the situation grows more tense with each passing day. Should China eventually emerge as a global power, or should nations in other regions enjoy a similar rise as Kenny suggests, this situation will play itself out elsewhere in the years and decades ahead.
All of this highlights some of the advantages of a unipolar system. Namely, although the U.S. has asserted military force quite frequently in the post-Cold War era, it has only fought weak powers and thus its wars have been fairly limited in terms of the number of casualties involved. At the same time, America’s preponderance of power has prevented a great power war, and even restrained major regional powers from coming to blows. For instance, the past 25 years haven’t seen any conflicts on par with the Israeli-Arab or Iran-Iraq wars of the Cold War. As the unipolar era comes to a close, the possibility of great power conflict and especially major regional wars rises dramatically. The world will also have to contend with conventionally inferior powers like Japan acquiring nuclear weapons to protect their interests against their newly empowered rivals.
But even if the transitions caused by China’s and potentially other nations’ rises are managed successfully, there are still likely to be significant negative effects on international relations. In today’s “globalized” world, it is commonly asserted that many of the defining challenges of our era can only be solved through multilateral cooperation. Examples of this include climate change, health pandemics, organized crime and terrorism, global financial crises, and the proliferation of weapons of mass destruction, among many others.
A unipolar system, for all its limitations, is uniquely suited for organizing effective global action on these transnational issues. This is because there is a clear global leader who can take the initiative and, to some degree, compel others to fall in line. In addition, the unipole’s preponderance of power lessens the intensity of competition among the global players involved. Thus, while there are no shortages of complaints about the limitations of global governance today, there is no question that global governance has been many times more effective in the last 25 years than it was during the Cold War.
The rise of China and potentially other powers will create a new bipolar or multipolar order. This, in turn, will make solving these transnational issues much more difficult. Despite the optimistic rhetoric that emanates from official U.S.-China meetings, the reality is that Sino-American competition is likely to overshadow an increasing number of global issues in the years ahead. If other countries like India, Turkey, and Brazil also become significant global powers, this will only further dampen the prospects for effective global governance.
Therefore, many of the benefits that Kenny predicts will accompany the rise of developing countries may not occur, at least in as dramatic a fashion as one might think. For instance, there’s no doubt that a richer developing world should result in more American exports. However, American exports might at the same time be constrained by a far less open global trade environment in a multipolar world. Things we take for granted today, such as freedom of navigation and airflight, could very well be much less assured in a bipolar or multipolar future. There’s also the possibility that the world will divide into spheres of influence, in which regional hegemonic powers demand highly preferential access to markets in their home regions. Similarly, the decline of the U.S. dollar and greater international competition could also result in far more unstable international financial markets that also inhibit trade.
In short, Kenny’s no doubt correct that China becoming the largest economy won’t be the doomsday that some in America predict. Indeed, there will almost certainly be some benefits that come with it. Still, the rise of China and the rest, should it continue, will also create new dangers and risks that the world would be wise not to neglect.
read "Gold Warriors" by Seagrave............it'll blow your mind who ended up with Yamashita's gold.
kind of like what we are doing in the ME, wouldn't you say?
Oh shit, I said japs. thats racist.
easy peasy japaneasy to fix...... say nips instead
Think I'll join you, but I gotta go to the store.
You may consider yourself joined.
A Sierra Nevada torpedo clink to whoever else may have joined.
Just the nudge I needed, thanks. Sitting here reading all this crazy shit and drinking Dos Equis piss-beer just because it was so cheap . . . it WAS time to go to the store, snow or no.
I'd been thinking Sierra Nevada for a couple hours!
<clink>
I think that Tyler is just providing a varied viewpoint.
Maybe it´s the same. I think we need Krugman´s view´s on this.
Hell. We could mostly all get along okay if various "governments" didn't get in the way. Governments are the ones screwing all this up. People just want to do business.
when you badmouth govts, you piss off half of the ZH crowd. You're a down arrow magnet, dude.
I can safely say I'm not in that half.
ZH is pro gov.com?? really? Pour another drink and rethink that post.
Cheers!
Yeah....I don't know where the hell he was planning on going with that.
Drunk or high.......maybe both.
Next day. Fully sober.
Yes, a significant number of posters on ZH ARE pro-statism. Pro govt influencing, redistributing, nudging etc etc.
Not me, of course.
Government is the problem, therefore we need (at least) less of it.
A whole lot less.
sign out the shop
less is more...
Can’t we just repackage a new SIV, sprinkle a little pixie dust on the book. Call it, the best fucking deal you could invest in?
/LOL
Here's the perfect example of why GDP is a dumb measurement. China can produce a lot of stuff and export it to the US, and the US imports it obviously. So china's GDP is higher from the production and the net exports.
But so what? If I had a guy who did all my work and imported all the fruits of his labor and I paid him shit to do it, who's better off? The guy whose economy is better or mine?
And here's what's even better: these guys peg their currency to ours. So we can continue to pay them shit and it doesn't cause our dollar to collapse. Then you watch as their political elite pocket it all in exchange for not upsetting the established order.
They are slaves. It's a slave culture. They're being led by the greediest pigs you'd ever imagine.
>>>but the only problem is: the guy that do the work for you and import your fruit and cuts your grass...happen to be the same guy who OWNS your paper debt bubble and you gotta give him back 1T+USD
They work hard. And we just imagineer the money out of nothing to pay off the treasury debt.
When you owe someone a trillion plus, it's their problem, not yours.
Yeah I mostly agree but at some point, when EVERYTHING you consume comes from over there, you have no source of income and they got you. That's where Ricardo breaks down, when you take it to the limit. So maybe China has just been playing rope-a-dope with us. If so, it's working so far.
Ah the classics.
Our import-based economy seems like a variation on the Trojan Horse.
I am not persuaded. China is an enormous country with some rich people and lots of poor people. They have been fairly reasonable to all their neighbors except Tibet. Tibet is a special case, since before 1935, Tibet was dreadful to local chinese, so this new fight is mostly payback.
We live in an era of relative peace. Excluding some African and Mideaset countries, wars betwen states are rare. If the Chinese and the Japanese want to throw a few punches over the Spratly Islands, it won't be good, but it won't end in a major war.
Most foreign military moves by the US have been to promote peace or reduce terrorism. No one is looking to expand out country or create imperialism. Our government is already doing its best to prevent domestic energy production, they don't need more from elsewhere.
So tell me...how WAS Room 101, Winston?
It's nice to see Jay Carney checking in....
The new beard is a nice touch.......now I don't feel like a 5th grader is trying to talk down to me.
I think any fears of a Chinese-instigated land war are greatly overblown --- judging from how all the Chinese in Vancouver drive, the PLA would probably drive their tanks right into the sea without even realizing it.
Now, just imagine them trying to parallel-park them .... !
I suppose I could stretch my mind to not totally disagree with the assumption that it would not be that harmful if China passes the US as the world's largest economy... but the relative size of each economy means nothing compared to the relative size of national debt and the inevitable ability (or inability) to repay that debt. While the US still has many attributes that could allow it to grow its economy, we have been shackled by big banks, big government, too many regulations, and too much political correctness. The only hope is a governmental and economic re-set, because we do not have any leaders able to change the current system.
I do not believe that I could not bring myself to not deny that you are not incorrect ... wait ....
I like Putin's idea about the rule of law. There ought to be enough nuclear weapons out there to establish a rule of law through the United Nations and end the military waste. I wonder what gas would cost if tanks or other equipment weren't driving around in circles all day.
I really hope Putin isn't stupid enough to mean that. The EU is enough of a poster child for that concept to show "That ain't gonna fookin work."
Take government, make it larger, more socially remote, and even less accountable to the people subject to it, then staff it with idiot politicians that think computers are truth machines and statistics are reality. Also give them an ivory tower belief in their own invincibility and rectitude.
Better yet, don't do any of that, because bigger is not always better.
Unless one considers that a new monetary system might (likely) will be in place post American surrender of the 'numero uno' crown, it is difficult to consider what the world might look like.
If the global populace has the ability to preserve wealth in a secure manner the effects of government generally might be mitigated.
Up to this point in modern history peoples have been forced to save in their countries paper or in a system in which the preferred reserve asset, gold, was controlled. Should gold find itself no longer controlled by countries claiming to set a value to it but instead free to find it's value in each currency zone by being traded freely at market prices, peoples everywhere could save, not worrying about the actions of their governments (and their governments predilection to over print.) They could essentially be their own central bankers. The governments of the world, at least those who choose to continue to print a currency, will be constrained in their spending. If they over print then gold will rise in price in that currency. The citizen who saved his excess production in gold could ignore the inflating currency, only buying fiat to make occasional purchases.
The impact this system will have gets explored regularly at fofoa's website. The euro (widely hated here at ZH) is the first currency to hold substantial gold and yet, instead of insisting on a ratio of gold to the euro, allows the consumer to decide the value of the euro by seeing its relationship to gold. At current 'controlled' gold prices this does not seem like a big deal. If the dollar fails it will be. Imagine if the dollar went to zero. The world would have to figure out what a euro was worth. The purchasing power of an ounce of gold would likely be significantly higher in an environment in which all trading was done with physical (only) gold. If the suppressive power of the derivative gold market (which is huge) were gone....well it is something I think about a lot...
Your seeing it RIGHT now.
That's why I have gone RURAL.
All city's will become hell.
All the rich will live in REMOTE gated community's ( ELYSIUM on earth ).
*
It's already here,
Post Hillary-2016, YELLEN will announce to the world that the FED is DEAD, and that the IMF-SDR will replace the USD as reserve-currency.
Not much will change, if you COP, if your not cop, then you just need to watch blade-runner, if you live in a city.
If you can go live in a self-sustainable remote village where 24/7/365 you can grow your own veggies, ... that is where you want to be, unless your fucking rich, and want to live in a gated community.
Or you might be a COP, and just wants to be a fingerman and fuck civilians when ever you feel the urge.
The 'EURO' is HITLERS baby, and the little people of EUROPE know this already most Italians want to return to the LIRA, ... and lots of greek have always wanted to return to the Drachma.
I concur with you the EURO is better than the USD, but the EURO cannot be kept alive without MURDER in EUROPE.
CHINA is NOT Surpassing the USA's PLUMMETING GDP and productivity, is simply sending the USA back to being a Penal Colony.
Soon the USA will not even be a player, ... only a mercenary army, a mafia enforcer, and a prison colony,
The USA has one purpose, to be the MUSCLE behind the IMF.
Satoshi, I found you:
http://i373.photobucket.com/albums/oo175/xxMorbidxAngelxx/messengers/high%20tension/fast%20and%20furious/1fa91858.jpg !!
no,no,no you've got the wrong dude this is Satoshi
http://www.funnyjunk.com/funny_pictures/3944765/batman+to+the+rescue/
Bend over world your new dick all red.
For my Masters, I'm taking many Asian civ courses...already had one intensive plus the classroom here. Friends asked me why? I said I would like to know a little something about our new overlords. They chuckled nervously. Pax Americana will become Globo Roto pretty soon.
Admire your comment. What makes you think this will happen? Many other variables have to unwind before that takes place. Agreed? Send your thoughts to ZH. I love this type of thought provoking discussion.
Please reach out to TD or other ZH contributors. We can help you score a A++++. Someone studying PAX America is unheard of. Thumbs up!
First off, I enjoy much of your comments. There are many factors, but I believe that we are about to head into a multi-polar system. Global and regional at certain choke points, but nonetheless, China, US, Russia militarily and other economic and resource driven regional hegemons like Brazil and SA. This could subside into more globalism or move into large scale war. I think as resources become more scarce, the illusion of harmonious relationships between these entities will give way to true underlying intentions. I see at minimum a regional war in Asia and possibly the ME; possibly a WWIII event too. There is too much debt, too little growth and too few resources amongst a lot of kickass weaponry sitting fallow. That's a bad combo.
Of course its Globalisation. Manifesting a poverty stricken country under a media driven campaign to paint a tyrant. You attack the county and seize all natural resources. Then you have Obama. A person who claims wealth retribution is part of reforming America.
Do you remember what state Obama claims to be born in? Next time you see Obama, ask him how we acquired Hawaii?
The Annexation of Hawaii
Second question: Ask Obama how he feels the comparison to Kenya or Indonesian property owner lifestyles verses Hawaii?
Shut down the bankster globalists and their NSA, DHS, and treasonous politicians.
By the dawns early light what proudly we hailed at the ... any how. The flag is still there and we are still under attack.
About $300 billion of China's GDP is double counted, because Chinese manufacturers can export to Hong Kong on a tax free basis and then reimport on a tax free basis. This washes the tax liability and spikes up GDP. China's official statistics are as reliable as any communist country's stats, which means they are BS.
China is about to exoerience the mother of all banking crisis. This will be very deflationary.
A must see, Chris Hedges...new to me, but spot on. http://www.youtube.com/watch?v=DpIrqXgWPxo
Kill Anything That Moves"...his book is not so much about the past as about the present." Hedges
"America’s Relative Decline: Should We Panic?"
Panic serves no one; it never did.
America's decline is in part because We ask stupid questions, rather than pertinent ones.
Seriously does that fucking wanker downvote everybody?
Strange that Satoshi below had a lone red arrow before this loser came thru yet again and Satoshi still only had the one....strange.
Don't panic. BTFD.
Go to Youtube and watch the clip of Wolfensohn speaking to an economics class at Princeton. The look on those kids faces is priceless. Here they sit in class, listening to the former head of the World Bank telling them all how screwed their lives will soon be. He's quite brazen about it. What he doesn't tell them, is WHO IT WAS THAT CHARTERED THAT COURSE. It was he and his "club" {or tribe}.
here's his yak at stanford
"But having said that, the crucial thing that needs to be underlined again is that in order for there to be real development getting to the people, it is not just multinational investment or trade." Wolfensohn/got drones
Don't panic, Reject these criminals, all of them, Remove the DC nation, and Restore the American country.
First and foremost, quit paying. They stole the loot in the first place and soon you won't be able to pay them anyways. Put your money into Gold, guns and grub.
Next, quit obeying. They derive their supposed authority from the Constitution. They are criminally in violation of it, so they have no authority.
And quit playing their game by their rules.
The Four Rs
Rejection: Quit paying, quit obeying , quit playing
Revolution: It is inevitable, so prepare, as they are.
Retribution: Is there really any place for these sociopaths and criminals in a restored civil and Constitutional society?!
Restoration: Restore the Constitutional republic.
Don't worry about WWIII the Chinese are going to take out the Western banking elite instead of destroying the planet.
The DOW can drop to 13,000 without causing pension problems.
Everything looking good. Have a great weekend.
China has built the worlds fastest computer now.
http://www.digitaltrends.com/computing/china-tianhe-2-supercomputer/
The US gov continues to chase away technology its citizens create.
It is hapening with my company.
America is not declining, it is most advanced super power of its time with excellent military backing that will grab the resources of these brics countries - if it has to. The most innovative thinkers are here in the United States (because there is freedom and resources to do what they want), 1% of the smart guys always run and control the system(designed for them to benefit themselves and their friends). However, all the perma bears on America - dont realize that America has had positive black swans like the internet, who knows there is a positive black swan out there - such as extracting resources from Mars - We already have had Discovery on Mars for 10 years collecting so much data about future prospects.
I am an Indian and I can share with you that Americans take risks and they know how to innovate fearlessly and working hard on what they want to achieve. however most of the population will again join new productive sectors once we end the FED.
Countries like India and China have so much corruption at every level that they will always struggle to compete with America. CHina is a bigger bubble than america and they difficulty building decent technology sending a space ship to the moon.
The Fed is corruption incarnate. Now reread your statement.
The FED is in essence US BIG BUSINESS saying we are top dogs, not you elected. PEriod.
And its worked in today's crazy world.
Dimon et al are more powerful than Potus et al.
Davos more potent than DC or Berlin or Peking.
If you want to understand the longterm vision of Davos Oligarchs about the debt cloud hangover they have generated collectively read this :
Rogoff Davos - Business Insider
I was shaking my head throughout reading that article, and after reading through the comments I found the last one to be from adventure007, which was like the cherry on top of that ridiculous article!
The entire globalized Neolithic Civilization is terminally insane. The social pyramid system was built, step by step, on the ability to back up lies with violence, which process kept on amplifying and amplifying itself, so that system developed the most criminally insane ruling classes, which matched those who were ruled over becoming equally idiotic. The long history of the triumph of backing up deceits with destruction has "successfully" led to the development of a runaway financial accounting system that is FUNDAMENTALLY FRAUDULENT, as well as based on being able to maintain attitude of evil deliberate ignorance towards the basic laws of nature, since everything that social pyramid system did was based on legalized lies, backed by legalized violence. There are no places in the world left that were not overrun by the Neolithic style of civilization, since that kind of civilization was built upon developing the social organization and weapons required to operate organized lies and robbery.
There are no good guys, there are only different kinds of bad guys. Both India and China are just as insane as the USA, and in their own ways even more so, due to their deeper history. The USA is controlled by the international banksters, who were able to more or less force India and China to adapt to try to imitate and master the banksters' levels of tricks and treasons, in order to get along within the globalized systems which have rapidly become electronic fiat money frauds, backed by weapons of mass destruction, all of which facilitates the runaway fascist plutocracy juggernaut to turn natural resources into garbage and pollution as fast as possible, while calling that progress, and those who advance that agenda the most are referred to as progressives. Hah!
Too bad, so sad, that any kind of return to the kind of village economic/ecological systems, that enabled China and India to persist for thousands of years, are practically impossible to return to, as long as the continuing expediences of the ruling classes' criminal insanities keep on working for them, which they will do, for as long as possible, until they have driven the social polarization and destruction of the natural world to manifest many, many orders of magnitude more than we can currently imagine.
While I agree with this article that the transition of the end of the Pax Americana will be quite disruptive, this kind of article is grossly over-simplistic and optimistic about what is really going on, since the international banksters actually have controlled the American government for a Century or so, and are driving the insane agenda of the globalized ruling classes through, which is more criminally insane than one can comprehend, because their ONLY qualifications where that they were those who were the best at being dishonest, and backing that up with violence, in the past. The global ruling classes are deliberately destroying the American democratic republic, while they extract profits from making that killing. Meanwhile, most Americans are too ignorant to be able to understand or effectively resist that. The end of the US Dollar as the global reserve currency will, I agree, be bad for almost everybody, but this article does not fully address how bad that could get, and how that could manifest within the USA, where the runaway real inflation will drive social desperation towards democidal martial law.
Both China and India, and similar countries, have no way to be able to go back to their sustainable economic/ecological village systems, but rather will be swept up in the generally insane genocidal global wars. We are rushing faster and faster towards exponential growth overshooting in the most spectacularly insane ways possible. Natural capital is being liquidated as fast as we can, while the money-as-debt systems drive that onwards, and those who temporarily benefit from doing that are able to do that even more ... regardless of the obviously suicidal, if not almost omnicidal, end results of that tragic trajectory.
Theoretically, we could develop better human and industrial ecologies, which operated with more long term survivabilities, within the real limits of the natural ecologies, and the limits of the natural capital. However, since the real world of politics is controlled and dominated by the most criminally insane people, who ONLY are running things because they were the best at being dishonest and violent in the past, but otherwise have no good qualifications whatsoever, other than having being able to wipe out any real, rational, opposition, leaving only controlled opposition, and political idiots being ruled over by lies which blatantly violate commons sense, but yet keep on operating successfully, because they keep on, in each short-term increment, advancing on the basis of bigger legalized lies, backed by more legalized violence.
This kind of article is mostly more of the biggest bullies' bullshit social story, whose basic frame of reference is to embrace the big bullies as being their buddies. As far I as can tell, adventure007, is the kind of silly goofball, want to be petite bourgeoisie, in a prosperous entrepreneurial middle class, who has romanticized what the biggest bullies really do, which is make the maximum short-term profit from killing the planet, while turning all its natural capital into garbage and pollution, as fast as possible, on an express one-way trip to Hell! However, since human civilization is based on a social pyramid system of triumphant runaway systems of force backed frauds, which are able to operate with evil deliberate ignorance towards what they are actually doing, there is no doubt that we are looking at the rise, decline, and fall of that civilization, with the rise and fall of the USA symbolizing the worst of that, being able to operate globalized systems of electronic frauds, backed by atomic bombs, in order to power through the killing of the planet, while pretending that was "progress," since they gave themselves a de facto license to kill, and felt that was an entertaining adventure, while it lasted.
The entire globalized Neolithic Civilization is terminally insane.
That doesn't sound good.
I guess we'd better go back and live sanely with the gorillas in the jungle.
No, I Write Code, theoretically the answers are to go forwards, through greater use of information, and higher consciousness, so that we become more self-aware, and thus, better able to operate our artificial selection, which was driven to exist by natural selection, being internalized as intelligence. We should go through deeper paradigm shifts in the philosophy of science, which are applied to politics, and especially through militarism, by understanding the death controls in radically different ways, which would enable us to develop a different murder system, which could back up a different money system.
Our problems are that we are no longer merely primates, like gorillas, able to tear up the jungle a bit, and beat each other up. We DID develop enough science and technology to enable global electronic frauds, backed by atomic bombs. What we should do is understand how we were able to do that, and then apply that way of thinking to politics ... However, there are no realistic ways to believe that will happen, since it would take a prodigious series of political miracles! I do NOT advocate going backwards ... although I tend to believe that we are not going to become saner in any sane ways, but rather, go through crazy collapses into chaos, after which I have no idea IF it will still be possible to go forward again towards some Translithic Civilization.
America represents the rise and fall of a combined money/murder system based on the maximum frauds and deceits about itself. Yet, I have more hope for political miracles in North America, than in China or India, although not much more, since enough Americans would have to understand enough to make the transitions back to relatively more sane views of their realities possible ... BUT, none of the established systems are going to like that! Still, as adenture007 pointed out in his reply, as things get worse, more people are going to be forced to think, and forced outside of their comfortable habits, wherein they did not have to think. In that context, I try to maintain the irrational hope that we maybe could catalyze those transformations ???
"The entire globalized Neolithic Civilization is terminally insane. The social pyramid system was built, step by step, on the ability to back up lies with violence, which process kept on amplifying and amplifying itself, so that system developed the most criminally insane ruling classes, which matched those who were ruled over becoming equally idiotic."
- I agree, as liberterians we have an awareness of this fraud - most of us research and question the status quo. However, the way the system works is "most people (>99%)" do not care, they are concerned about their lives, their toys, their relationships and "Inevitable US Dollar Collapse" doesnt seem to be part of their reality. They just dont care. This attitude is part of human nature - its kind of how the human mind works - people wants false certainty even they its contradictory to being logical. Most people and do not desire change until they have to - and a dollar collapse doenst change the fact that intellectual capital and the ability to innovate comes from the people and their ideas not the government. Govt is always there to steal, but a future system will have its good and evils. I understand how angry and aggravated about the "Scam of the century", you feel - but sheeples are not going to take action unless they lose everything and the system repeats itself. Thats the reality. People will only become action when they take aware.
The only thing humans learn from history that they do not learn from history.
As you mentioned today "The global ruling classes" are the "Banksters" - tomorrow the system will be run by someone else - "...." This is the way the world works - Good cannot exist without bad and it is from each individuals perspective - that we "define" - good and bad and express our actions. I see that you have the awareness and the honest intention for people to realize that they are being defrauded, but they are not going to be aware. Atleast Americans have created technologies such as "YouTube" where the "truth eventually comes out" - and people are becoming aware. But countries such as India / China where more than 70% of a billion people living in remote villages under $2 a day have no clue that their "Govt" leader is lying (atleast 50% of the americans know who the NSA is) - Asian countries are decades behind in technology development and importantly risk taking. In Japan, it is very shameful to see a bet gone bad and people commit suicides for failures. In America, people embrace failures - these kinds of characteristics will allow for America to lead in the coming decades.
Thanks for that reply, adventure007.
I agreed with almost everything you wrote ...
Btw... I do like to get high and listen to Peter schiff James Rickards Jim Rogers ray dalio kyle bass...
Btw... I do like to get high and listen to Peter schiff James Rickards Jim Rogers ray dalio kyle bass...
I have not lived my life. I am 28, I have wasted most of my years and I will continue to do so. I cannot find a purpose in a society in that which you describe. I do not believe I am alone.
america is in absolute decline
"Still, on balance, the U.S. has been a positive force in the world, especially for a unipolar power."
This is utter, unabashed horseshit. Honestly - fuck you, right in the colon, you vapid twat.
Kenny don't know China, and Mr. Zeck must not read a wide variety of news sources. He also appears to be a cunt.
All else aside, one thing China doesn't have to deal with is a parasitic, wearmongering Israeli 5th column dominating its FP and successfully parrying most criticism via media influence, political influence, and crying "antisemite" at any *honest and fair* exposure of wildly disproportionate and foreign-loyal Jewish/Zionist/Evangelical power.
Again, this junker is a sucka m.c.
Defend your junk, Sir!
" else aside, one thing China doesn't have to deal with is a parasitic, wearmongering Israeli 5th column dominating its FP"
Don't be too sure. It appears China is the tribe's new Eldorado
http://www.haaretz.com/print-edition/opinion/members-of-the-tribe-thrivi...
“Once we squeeze all we can out of the United States, it can dry up and blow away.” — Israeli Prime Minister Benjamin Netanyahu, 2002.Yep White Terror still reigns. Empty cities of smog guzzling ghost citizens earning .50 a day soon will run the world monetary system. Get the fuck outta here. The self contained nation will survive and it ain't Johnny Appleseed nor the high cholesterol egg yokes of the third plenum.
I'd wager an egg roll that by a majority of evaluation methods China's GDP is already greater than the US. Too much of the US' output is already built on Chinese components and we just mark them up and count them twice.
OTOH it isn't doing them all that much good, they still have no air to breathe and another 800,000,000 citizens still living in the dark ages, except for cell phones.
The US is certainly in a net decline with excellent odds of really cratering very soon, yet there are also bright spots, and overall I'm still happier living here in the USofA. Though if they just spoke English over there, that would at least count in their favor.
But to answer your question, sure, yes, by all means panic now, why wait?
"I'd wager an egg roll that by a majority of evaluation methods China's GDP is already greater than the US"
Yeah, pretty much for sure.
As to speaking English, you might want to start learning Mandarin, friendo.
When reading this article, and knowing this crowd, I did an over-under on its rating, guessing 1.8. I was too high.
While the US hasn’t exactly been a completely benevolent superpower, I have to wonder if the predominant economic and military power of any time in human history would have allowed some powerless and developmentally backward nobodies to control a commodity vital to the functioning of society.
If oil had been crucial at the time of Alexander, or the Romans, or Charlemagne, or the Seljuk Turks, or Genghis Khan, or Tamerlane, or the latter Moghuls, or the Ottomans, or Tsarist Russia, or the Empire Brits, or Nazi Germany, or Imperial Japan, or…..would Saudi Arabia, Kuwait, Qatar, the UAE, etc., have been allowed to exist as sovereign states and retain majority control over both the commodity and the wealth from selling it? How many 186-story towers and sovereign wealth funds did Mexico and Peru have after the Spanish acquired all that silver? When Cortés earlier left Montezuma, did the latter drive the then-equivalent of a Bugatti Veyron and own a Marbella villa?
“We’re not going to put your cities to the torch, nor hang you in chains, nor rape your daughters” Daniel Dravot
Historically, the opposite has been the “human” thing to do. The jury is still out on what a Chinese superpower would be like, but if Tibet is any indication, humanity is going to revert to the mean. At the same time, China’s worst enemy in all of its history has been China itself, so I would suspect that even if it achieves some sort of economic and military superpower status, its reign will be short lived. Even China's leaders and princelings seem to agree with that. Externally, the nation and its people are already disliked by its Asian neighbors, reaching “ugly” status in record time.
(Somewhat related sidenote: Sometimes one gets a better view of things looking to the side, like trying to pick out a faint star in the night sky. To get some view of the liquidity problems in China, here's something from neighboring Burma. Chinese, by purchasing the IDs of deceased Burmese, bought up most of the real estate in downtown Mandalay. They created a bubble, as they are wont to do. Few transactions take place now, but in those that get done, prices are down 67% in one year. Ouch!
I learned Japanese because I lived there, not because I actually believed all the tomes written in the late 80s about its coming transcendence. I feel not even the slightest compulsion to learn Putongua.)
Dude, the claim that the US has been mostly benovelent is pretty much demonstrably false, and is a wholly logically disparate argument from the notion that other superpowers were no more benevolent. I'm not sure one can fairly remark on the Mongol hordes - more proximately, I'd posit that the U.S. has been no worse than the British.... there are lots of apologists for Britain's 3 centuries of hegemony, and there's no doubt good came along with it, but the English slaughtered the Irish, Scottish, Welsh, and Cornish not out of benevolence but out of what, now, we'd simply call racism.
"and knowing this crowd,.."
I would be more cautious about treating ZH as a monolith. Largely libertarian and Austrian...sure...but that doesn't mean everyone who voted for RP thinks the same way about most things.
Oversimplification is the enemy of precision, homeboy. Napoleon dropped that shit.... and the man had some interesting ideas about the banks as it happens as well.
You are correct perhaps, but CHINDIT is like the only human here on ZH that see's ASIA with his own eyes, so his perspective almost always 100%, and his read of history is excellent.
I sort of agree with you, but on the other hand I hate to say us humans do like to Generalize, and I see ZH as a Rush Limbaugh right wing apology crowd for Wall-Street, me thinks a lot of under or un-employed stock brokers, perhaps pushed out by the automation of their biz.
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I'll go back and try to read where CHINDIT apologizes for USA murder I didn't see it, but certainly the BRITISH are the assholes of EARTH they destroyed INDIA and CHINA back in the day, and post 1950's the USA took their place doing the same.
While the US hasn’t exactly been a completely benevolent superpower, I have to wonder if the predominant economic and military power of any time in human history would have allowed some powerless and developmentally backward nobodies to control a commodity vital to the functioning of society. - chindit
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Well that was a typically ZH /snide, /sarc remark which is all too common here and almost adolescent.
Just think of BUSH and his 1,000 point's of light, then he went on to kill millions of IRAQI children with dysentary and depleted uranium.
Obama's hope&change and droning weddings and funerals, of course its always with good intentions.
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Well at no point did anybody "LET" the USA penal colony take the "PRIZE", the USA engineered WWI, and WWII, and they got the prize because they murdered 100 Million people since 1905.
I did not say "mostly" benevolent. Inadvertently, I might have used (your?) British understatement. Perhaps it's a personal choice, but as a student of history, I guess I'd feel better in a relative sense if my overlord was the US and not Genghis Khan (history's greatest mass murderer in a percent-of-the-human-race sense) or Tamerlane.
I have an acquaintance who is Burmese and a bit of a rogue. He has fallen afoul of the law in both Burma and neighboring Thailand, and has done time in both country's jails. He once told me, "The Thai jails are more better. Guards don't beat you so much and sometimes the food don't make the shits."
Exactly. It isn't that the US has meddled in nearly everyone's affair in the post WW2 era or committed some horrendous/aggregious acts against a number of countries with Vietnam being No. 1 on the list and Cambodia probably No. 2.
As one of my professors in history told me, 'military history is built on a pile of skulls.' By historical standards, yeah the US has a bit more beneficial. It is just a pretty low bar of comparison. As for the Chinese, the Han Chinese don't exactly have a very favorable historical record of how they treat immediate neighbors when they decide they have to deal with them.
Do vehemently disagree with the writer's premise that the US doing the global reserve currency will be a good thing for most Americans or that the US will go 'more butter, less guns' in the future either. Much more likelihood is that we cut back on other areas while keeping ourselves armed to the teeth as much as possible including a full nuclear deterrent as the Russians did.
As always good stuff.
I concur with you 100% seeing what CHINA is doing to LAOS and MYANMAR(BURMA) is terrible. Driving up the cost of land/buildings,...
Chinese men going to Laos, & Myanmar for wives... Eventually there has too be push-back, I'm seeing lots of abandoned 'chinese' baby's all over LAOS, where the chinese 'husband' fails to return,... For a CHINESE man a 'sex holiday' in LAOS is extremely cheap an easy, so long as he plays 'illegible batchelor'
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But lets CUT the shit here, and admit that CHINA is to the region what USA is to Mexico, Japan might be CANADA ( no not reall, japs are nazi, ... ok there is no canada ), but certainly the rest of the AREA is poor like Mexico and the old Carribean UK colony's.
Also everybody loves CHINESE and there money in ASEAN country's.
I find Chinese sticks, I always forget my Japanese and Korean, but my Shan ( myanmar ) and Laos, is pretty damn good.
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Let's remember and I'm not sure if I saw it here today, but this story headlines "RELATIVE", and like the old definition of depression and recession ...
A recession is when your neighbor is unemployed, a depression is YOU are unemployed.
America has ONLY gone to shit, if you ain't got lots of money,... and same in ASIA, if you got $$ then its all good.
So at the end of the day, I would admit its all same-same.
In the past 20 years CHINA has skyrocketed, when I first came to china in the early 1980's I could NOT spend $10/week, or a month [ there was nothing to buy:( ],
Now CHINA in the city's is MORE expensive than USA, ... so for the people who didn't participate in the BOOM cost of living has gone up,... I remmber when I arrrived a doctor or teacher made $40/month, and its really not that much more today, but now $40 will not even get you laid in bad whore house. That's amazing inflation, making the USA during that same time trivial.
Of course Burmese and Laos are still happy to work for $40/month,... so not much has changed south of China.
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Superpower? Not sure CHINA wants to rule-the-world, while UK/USA have long been imperial assholes that has never been the case of CHINA, ... but you never know they might get their RUMSFELD or CHENEY in power that thinks otherwise.
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Lastly, I used to go to Luang-Pra-Bang every year take the boat all the way down the Mekong River, but now I dont' do it anymore, ...cuz the CHinese have destroyed Luang Pra Bang. Now its expensive and all the charm of a 200 year old french colonial town is gone, ... all that remains now is over-priced chinese disneyland.
Its Interesting you say that.
In December 1973 in the midst of the Oil/6 day war Crisis, the newly formed (1966) OPEC cartel hiked the price of OIL up, under Saud's Sheikh Yamani's leadership. The Seven Sisters, the oil lobby, sent their chief negotiator to Vienna to discuss the Oil CRisis with OPEC in Vienna.
The man in question was Shell Trading's Boss Mr Andre Benard, a Frenchman, who co-chaired the Shell command structure with a dutchman called Wagner. He came back empty handed from that meeting and of course now we were in 11-12 $/bbl oil price for the years to come.
Over a pre Xmas lunch where all the french community of engineers working at the Shell the Hague facility came to celebrate the end of 1973 Mr Benard made a very desperate "doom n gloom" speech to all present there.
In essence he said : The world will now change as never before; We of the West didn't have the BALLS to tell these Arab shills WE MADE THEM what they are with the Saud/Us handshake of 1945. And today, its the fault of Henry Kissinger. This man runs US policy and when we ALL said to him threaten Saud with military retaliation, now that ISrael has WON the 6 day war, he VETOED that option. Pax Americana is playing a dangerous game to our collective detriment. And we Europeans have nothing to say in this matter since the Suez Debacle when US became de facto top dog in US/ Soviet geopolitics of the region.
"We will never be the same again in Europe as ALL OUR ENERGY eGGS are in that ME Oil basket." (Needless to say both France and Japan launched huge Nuclear industrial projects from that day onwards.)
Mr Benard carried the slur of that faiilure on his CV and retired a bitter man, whose pitch had been vetoed by the US administration, now deep into making the Petrodollar axis the plank of US fiat salvation. (Our money your problem and City of London's petrodollar recycling binge.)
Yes, that was a tipping play that benefitted the Dear Henry Detente strategy, the ping pong game, the effacement of Europe's energy independence and current dystopian situation in first world.
It was ONE of the three TIPPING moments in the current Pax Americana malvolent evolution, where the three vital threads of MIC/Reserve Money/OiL plays all got nexused around the ME Oil patch in total contradiction to nation state independence.
The other two tipping moments were : 1979 Oil crisis (Peak oil implications world wide) and then the decision by Reagan/Thatcher to move first world BRUTALLY into supply side financialised REAGANOMICS mantra, and its NWO sequel of "outsourcing" slave labour arbitraged meme, after the collapse of Soviet rival where the MIC had no opposition anymore.
The rest, as follow up to 1991 military pre-eminence, is pure delusional Hubris; Roman style decadence hitting the US and impinging on all our lives.
brilliant summary and digest
if looked at strictly through dollar usage the USA has been devaluing its way to average ness since Day One (the day we exploded the nuclear bomb in New Mexico.)
The study of economics didn't come to the fore until the 70's and the oil embargo daze.
Those folks are pretty much setting the Agenda these days.
We're definitely acting in a diminished capacity.
There is no lack of a to do list either though.
Rome collapsed because it just didn't matter anymore.
Look at the Great Powers pre 1914: where are they now? All save the USA have been swept away.
Since 9/11 the USA has been everywhere ("Bush Fatigue") and nowhere "(Obummer.)
My personal view is that we don't have a "White Man's Burden" complex to Sally us forth but "laws" and "rights" and "the Olympics."
Great if you're an economist. Not is great if you're Alexander the Great, Caeser or Napoleon.
If there is one thing that stands out with the USA it's the largest undefended border in human history. I think we're still struggling to come to terms with Mexico.
I do agree we haven't "gotten it right" going on many years now.
"We're poor" for lack of a better term.
Who comes to the USA to see Great Wonders being built or made?
I agree...China has won that battle. They're still building Greatness.
I would say a nuclear powered Carrier Battle Fleet is Greatness Coming to You however.
The last great expression of Global Power was the end of Gulf War One and the massive display of weaponry put forth after simply annihilating Iraq.
What our destiny turns out to be in the Middle East has Yet To Be Determined.
We're over there still...and will be for a LONG time.
Same goes for Eastern Europe, Japan, Korea, Australia. (interestingly very little going on in Latin America. Is that about to change?)
Like a police force suddenly confronted with "crimes everywhere all at once" I think we really are on the precipice of being fully engaged "within" or "because of" the Internet(worked) of Everything.
I think these days of Navel Gazing our fast approaching an end.
Kiss my ass and suck on my balls
would you enjoy that?
Only if you're a horney grandma.
America in Decline?
Well perhaps the USD ain't in decline,
The US-MILITARY ain't in decline
But the SOCIAL FABRIC of the ameriKKKan people is in deep decline
The COPs have gone full retard in beating little girls and granny's,.. no way that would have gone down 40+ years ago, well not in public
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I dont' really pity the middle class topic, the PENAL-COLONY only had a middle class post WWII, so it only existed for a mere 40 years, and then POOF gone.
re Should We Panic?
No. A better strategy might be to feign calmness - so as not to alert steerage on the USS USSA - and whistle Dixie as you lower that liferaft into the water in the dead of night..
For instance, the past 25 years haven’t seen any conflicts on par with the Israeli-Arab or Iran-Iraq wars of the Cold War.
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'Americans' live in a world of fantasy.
One thing maybe to explain their hatred to negroes is that negroes are so useful to see through 'american' propaganda.
Just applying the method: seeing to negroes to see if... yields a result.
Second Congo war: 1998-2003. Around 4 to six millions people dead due to the war. Dwarves the Iran-Iraq wars.
Best thing is that US Americans had their hands into bettering the conflict lethality.
From an 'american' perspective, negroes seem to have only purpose: tearing down the 'american' propaganda.
AnAnalogousAnus!!
welcome back, it seems you've been away for sometime now.......shaving those farm fresh pigs can be a heavy burden on time and energy I know, Satoshi in the next cubicle wants to know if you're in for beers after work??
Hey AnAnnoyingMoose, I never realized that dwarves fought the Iran-Iraq war(s?). That must be why the last Iran-Iraq war was so short --- I never even heard about it.
You are a literal fount of knowledge and insights, blobbing up both to infinity and beyond.
Despite emburdenment by eternal naturalty of what AnAnonymous calls American Citizenism, I am forced an admitting. While averagely his commentation pours repeation, happenstancially he will somehow throat a cogenter perspectivity that has lacked.
Not selling him as the next Evan Ambroses Piltchard as his propension for cogency is a punctual phenomenum and can quickly advances reversely to fantaisical degenerescence. American citizenism citizen eternal nature impels holding feet to the fire when he is off his shoes once again on a cheap progating binge.
Bottom line is while some rare commentations have ground, don't expect a golden age where everything is honey and donkey milk. But hey, duplicity of American citizenism has fun sides...
Forcing truthinesss to the exterior, ah, that would indeed be a US Anglo 'american' red herring. But hey, cast a wide enough net and ....
'Americans' again trying to sell the idea that 'americans', when they oppress, oppress to benefit the oppressed and that this benefit comes from the sacrifice of the oppressor.
A decline in 'american' success in imposing oppression globally means nothing to oppressed people.
But it means for 'americans' as they are going to lose what makes them affluent.
This 'american' author is able to shut down a 6 million casualties conflict just in order to get some comfort of mind so that his 'american' propaganda might flow and he wants people to believe that just for a fraction of a second, he is able to care for oppressed people?
It takes an 'american' to believe that kind of stuff. It takes somebody who is already persuaded.
What the use then? People are already persuaded. Oh, yes, consumption... This useless propaganda consumes. So it is good.
Welcome to an 'american' world, it is a cosy place to live, you'll see.
Hey, that you, old roadside-pooper?! About time that you blobbed up. It's been quite qiet here, and MillionDollarBonus seems to be still asleep. Come on, slap something out!
he gets paid in food palettes spit out of a tube each time he writes a word containing american or ism
http://www.funnyjunk.com/funny_pictures/3944765/batman+to+the+rescue/
he's a top producer at the Chicom Call Center
HE'S BACK!!!!!!!
US 'american' Citizenisms rejoice!
Hooray, hooray, three times hooray, looking forward to bearing with it!
It's fairly simple. WW2 changed the world order with the only real economic competition coming from the USSR. The cold war was opportunistic bullshit based on lies and paranoia mainly used to solve the post-war problems. Problems being, primarily, a WHOLE LOT of soldiers coming back home who didn't want to go back to the farm and the end of the wartime command economy. How do you solve that without much thought? Find an excuse, any excuse, to maintain a large portion of that standing army. Enter the Military Industrial Complex. That couldn't account for it all however, not by a longshot. Which is why all those wartorn nations were given loans, loans to get them on their feet just enough to buy american goods. It's easy to be #1 when all your competitors have been bombed to hell and are more concerned with feeding everyone. 20 some years down the line, is when it all started going to hell though. Actual competition in the market ended that "golden era" where middle class meant that a single wage earner could raise a family, have time and money to travel, own their own home, own a car, put the kids through college and be able to rely on healthcare and pension without worry.... THAT was middle class. Unions kept wages up, taxes kept CEO pay down, workers had more disposable income to spend on quality goods made domestically, while at the same time seeing a whole lotta exports going by hammering down those emerging economies with war and CIA-instigated instability. Scream about those "evil commies" anytime you want to get something done, and you're golden. Civil rights? Must be commies too.
Not to last though, not by a long shot. It was a living standard bubble, the largest ever bubble. Wherein the peoples of a single nation simply had it better than everyone else via artificial inequality. Globalization didn't just *happen*, what happened was other nations reached a level of development where that offshoring was possible. Automation reached a level where skilled labor could be replaced with unskilled. Demonization of unions, and of course, while the rich get richer, the poor are just fucked. The bottom 95% have not only seen wage stagnation, but adjusted even for the fake inflation stats, wages have FALLEN since 1970. Of course, costs continue to rise, which means that disposable income is at an all time low. Savings is in the toilet, dual-income households are common, houses are used as ATMs and credit card debt is so rampant that it's the "new normal" to have thousands sitting there never to be paid off. The new normal is hand-to-mouth, paycheck-to-paycheck. All you can do is con the working poor into thinking they are middle class and getting them to fight amongst themselves lest they notice the elephant in the room. It's not getting any better, it's only getting worse. The bubble is ending. Other nations are reaching a point where they too are either living better, or on the cusp of parity with the US for large swatches of their population. They do it basically by copying the social-system that made the US #1 in the first place, while the US continues to go regressive, ignoring its own history. When you find yourself in a hole, most at the very least stop digging. The US just goes looking for a bigger shovel, hoping that eventually it'll unearth a ladder. More realistically, it'll strike oil, and just before drowning in it, will exclaim how great it is.
Sure, increased regulation is a part of it, mainly because as more became aware of the damage that was being done to everything around them, something had to be done. This isn't a bad thing. What IS a bad thing is when regulation is effectively written by those who would benefit from it financially. In most places, this is a case of severe corruption, in the US, it's a Tuesday.
The real issue is that it's a systemic problem. This didn't just *suddenly* happen. It's been headed this direction for some 40 years. Little by little that pot's been heating up. The rich exclaimed how great it is that the water's all nice and warm like a hot spring. Now that it's reaching boiling, sorry, don't act shocked. You can't really do that whole war thing again, as everyone you might want to cripple has nukes. Sparking instability to crash other economies doesn't work all that great either, as whistleblowers are everywhere and leaking information is easier than ever. So get used to it I guess, that's about the only option left on the table. The "living standard" has been, in actuality, decimated. It's been subsidized for decades on cheap goods from globalization. Goods that are not worth a damned thing and 90% of the price is just middle-man markup. And that's all there is left to the economy now, a web of middlemen who survive on bullshit and are basically doomed.
If I sell a product for $100 per unit. And of that $100, $50 goes into my own pocket, $30 goes into my sales channel budget, $10 goes into logistics and marketing. $10 goes to the factory that actually made the thing and of that $10 they made a profit of $2. What happens when that factory is having to support higher wages via growth, inflation and currency valuation? What happens when it's actually starting to lose money? Demand an increase obviously, now they need $12 per unit. Unfortunately for you, the market can't bear that increase, and you are already dealing with a problem of your own inflation, higher expenses, investors demanding to see "growth" and your own greed. I guess you just find another factory, or accept lower-quality output. Your marketing wizards do their magic to con your customers into thinking that the lower quality is actually better. Who cares, right? "Made in China" means that they can bitch about China making crap, not you, you're just a victim of circumstance. Fine, you reach a breaking point, you change factories. Unfortunately for you, that original factory doesn't just vanish, those workers don't simply forget. The factory comes out with it's own brand of your product. Except they can sell it with higher quality for $80. Oops, you're fucked now, you're really fucked. Your lunch has been eaten and you're just left with a big heaping helping of your own bullshit to feast on. BUY AMERICAN you scream, but that too shall fade and die out as consumers discover they just can't afford your rates as their wages have been shit for decades and are tapped out. Only thing left is to either curl up and die, or making cuts everywhere else... which further decreases the prosperity of your own workforce, which means they are worse off, and can afford less, and the cycle continues. That factory on the other hand, Rolling in the dough with their own brand, handing out epic bonuses, attracting talent and starting to innovate beyond what you can do. Is that a bubble too? Sure, but with the right steps, it can be sustained. As long as investment is made in the common citizen, that bubble can last a good long time and grow and grow and grow. Notice how those "economists" in the US have been screaming about bubbles in China for whatever they can find? When you refuse to acknowledge that your own bubble is deflating, much less even exists, EVERYTHING outside looks like a bubble.
Those jobs are gone, they will never come back, and automate all you want, as long as others are willing to accept less, you're still doomed to failure, even moreso, as those little robots of yours might never get sick, never demand better wages, never quit and go to the competition, never steal or break things... but they also never buy anything either, and your investors are still going to demand to see infinite growth in a finite and shrinking market.
See AnAnlogousAnus!
that's how you do it!! Cogent, concise, factual and well written, not that hard to do. Other than the part where China is NOT a PONZI scheme either, it's an A minus. He's obviously working several floors above you at the nondescript building on the outskirts of town
laomei's posts today have been nothing short of extraordinary. will let him respond to the ponzi argument, it's a bit more complex than a simple pyramid scheme. however, that is not to say that it is superior, especially from an environmental standpoint.
Oh there's always some bullshit that's going on that's ponziesque, finding a sucker willing to overpay so as to support the previous suckers who bought is like, flat out, the very definition of capitalism and free-market. Here's the eventual part where China will hit a brick wall:
Once all those peasants move out of the village and into the cities, where they have to struggle to earn money rather than grow food to support themselves. Once land is reformed yet again, allowing more private trading of once-community land. Restrictions are lifted on what can be built where. This is all in the future, it's practically a given if you follow the ebb and flow of the drive to "develop" the country. The goal is a consumer-driven economy where the little scraps of paper are what matter and determine who is rich and who is poor. I can go out to the countryside and see a family with *nothing*, but they are all eating well, live in a nice home and keep a nice farm that supports themselves. A million bucks might last you a lifetime, but a few acres will feed a family forever. This, is, unfortunately, incompatible with the growth model.
Once the workforce has been shifted out west over and over again, chasing the cheapest wages, there will be a problem. Once cities are financialized and there is an oversupply of overqualified labor for industry sectors that simply cannot grow any more without just poaching and becoming "efficient" by killing quality and reducing staff in the name of "growth". That's when China's fucked.
The goal, of course, is to delay this as long as possible by creating new markets elsewhere, ensuring that demand is in stready supply as it is needed. This is the true aim of relations with SEA, Africa and S. America. It's why China is going out of its way to build infrastructure like roads, schools, hospitals. Striking highly lucrative deals based on resources to try and ensure stability... hard to justify fucking around when doing so is going to jeopardize relations with the guys making you rich in the first place. That's the crux of it all. And it's flat out counter to what the west in general as done. The west, primarily sees those same markets as targets for cheap labor and cheap resources. Funnel as much cash and weapons into the upper crust, keep everyone else poor, and CIA the place now and again to maintain that bottom line. Encourage the upper crust to piss away money on whatever crap you can throw at them. China's fucking with that. Once the normal people are getting a taste for it, it's over. #1 complaint about Chinese entering markets? They work too hard and are too competitive. But the commoners are finding they can afford more, are seeing their wages increase like never before and seeing their shitty little landscapes improve for the first time in recent memory.
It's all fucked in the end obviously, but the big question is when. When, is all that matters. The definitions of economic theory and statistics are by default, crafted by those with the power and influence to define them. If something changed and "prosperity" was defined differently, contrary to previous methods, who's to say what "growth" is? Currently, it's defined by a bunch of rich greedy fucks on a system based on buying shares of ships and government fundraising schemes for wars. Perhaps the standard of success for a company is no longer based on growth and profits, but how many employees they can support with decent wages. To those who scream "umpossible!", remember that the world was on a gold standard until the day the US flipped a switch, said "lol, gold's dumb, here's how things work now"... and as the top economic power, everyone just had to go along with it.
Here's how a healthy economy operates, with no particular starting point.
Productivity Grows -> Wages Rise -> Workers Spend More -> Companies Hire More -> Tax Revenues Increase -> Government Invests More -> Workers are Better Educated -> Economy Expands -> Productivity Grows.... and so on.
The keys are that there has to be a starting point and that it's all connected. Once one link breaks, it all starts going to shit.
In China, wages are rising due to regulation and market growth, Government investment is happening irrespective of immediate tax revenue and there is a by-default emphasis on real education. It's a multi-pronged attack, and it's what you'll see in just about any rapidly developing economy. Once it becomes seemingly self-sustaining is when the problems start. People get greedy and corruption runs rampant.
What's happened in the US, is this: Productivity has risen, but wages have not, it's all been funneled to the top while taxes which previously helped equalize this were nuked. The rich are not job creators, the middle class is. People spend less, companies strive to be "efficient" by not hiring as much. There's less and less actual investment, and the little there is is derided as waste. Education is falling as no one knows what the fuck to study that might help them. The economy itself is stagnant and thanks to financialization and wall street, the stats can all be fudged to pretend nothing's wrong. The government's gotten in on it as well because fuck it, maybe the key is irrational exuberance and if you can be fooled into thinking everything's ok, it will be. Everyone watches the little numbers at the casino whiz by, because if they drop too much, there goes retirement and the whole house of cards falls down as it's all systemic now.
Do you know who cares about the stock market in China? What about in other developing nations? Pretty much no one. It's basically just there for posterity reasons. The total capitalization is so insignificant it's basically a joke. Major companies are on it so as to give an internationally accepted "valuation" so as to prevent the stupidly cheap buyouts that happened in the 80s and 90s from happening again while not having to deal with the US and the WTO crying about how it's so unfair that they are not allowed to take over critical sectors.
Actual financial problems in China include:
Some poorly thought out investments in companies that bullshit too much
Private banks, which desperate to find an angle to compete with the big-4 have made some hilariously stupid moves, which will in the end only result in the big-4 being stronger.
Way too much money going to the top, doled out in year-end bonuses rather than actual wages
Official corruption, tends to be low level officials who know they will never rise higher
Public sector wages are honestly too low. Corruption at this level has gotten better, but to the common person, raising wages to stop corruption is just another form of bribery. Yes, the view is still non-market based, assuming that those in the public sector should be there because they want to serve the public and sacrifice their prosperity to improve the lives around them.
Individual investments of the rich might as well be a casino. Speculation has driven some stupid shit to happen. Overinvestment in highly risky ventures is not uncommon. A local example: Someone decides to make pastries and after doing delivery orders opens a small storefront with minimal investment. A buyer sees the financials, likes it, buys them out for 1m RMB. Buyer comes in, revamps the place to make it classy, jacks up the prices a bit, sees some success. Financials are a little more spotty now, but it's still relatively clean. Another buyer comes in and shells out 2.5m less than a year later. Staff is cut in half, the original employees are replaced with migrant labor, portions are cut, prices go up, random shit is added to try and capture other segments. It's no longer a fun place to go, the workers are tired and underpaid, pressed to hard-sell anything and everything. At this point, in order to boost the balance sheets, they do a VIP card system. Pay up front a few hundred bucks and enjoy a 20% discount with the card. The asset is claimed, the liability is not. A few more storefronts are either rebranded or opened to turn it into a chain and resold yet again. New buyer comes in with no fucking clue what they are doing, they just see the valuation going up up up, buys the original store for 4m, and after a month, realizes they are fucked. Prices go up again, and they move to a cheaper location, which has no foot traffic, but it's either that or go under or operate in the red. The storefront is replaced with some new startup and the original store just dies entirely 3 months later. This happens so many times it's just hilarious. The other method is to have a profitable location subsidize a dead location. Simply because if they close up shop, someone in the same sector will come in, have minimal investment to do due to the already-paid-for renovations, and succeed where they failed. Leaving a location is a practice in scorched earth, wherein everything and anything is stripped for the purposes of denying the competition an easy in.
You see somthing similar with housing. Small apartments are easy to rent and easy to flip, therefore they are worth insane amounts. Large homes are an investors folly. Great to live in, but due to market restrictions, someone with cash will invest, never move in, never rent out, and generally see it as a place to stash their cash with the assumption that no one else will do that and values will rise. Renovations and decoration has a market value of approximately zero. An empty shell is worth more than even a nicely furnished place, as redoing it costs more than doing it the first time. So you get some stupid, basically empty developments that no one real wants to buy. Valuation is, like anywhere else, linked to the area and previous sales. So when someone gets desperate for cash, they'll sell cheap and those surrounding values drop. It's not really a *bad* thing per se, it's just market forces at work.
Other stupid shit has happened due to the massive and rapid expansion of the cities. i's went undotted and t's went uncrossed, resulting in property that is theoretically worth something, but legally untransferable in a way that is guaranteed. That trust which is due to default, was backed by flat out illegal companies. As in, here's some land with coal, lets just start digging it up asap and pay off whatever official needs paying off to look the other way. Sure, we don't actually own the land, or have a legal right to use it, or even have a legitimate company structure... but fuck it, lets do this! Color me shocked when owners get arrested, operations suspended and "companies" dismantled. If not for the attention to pollution and environmental damage, it could have gone on, but policy is looking to consolidate the small companies, and in the process, those skeletons all come out of the closet. "Guanxi" only lasts as long as your hookup does. Once that relationship is non-useful, you're fucked plain and simple. Normal people here don't worship the rich as job creators, they don't assume that one day they too shall be rich. In fact, when the rich get fucked over, most just see it as justice, as honest people generally don't get rich like that. There's always elements of corruption and tax evasion and labor rights violations.
Other problems: GDP-related bullshit. Local development projecs which even in theory will never go anywhere but are forced on developers as a means of access to needed development. Land prices get jacked up, which means local revenue rises from land transfers. This is a system which needs revision. Investors are going to eat some losses on this most likely. Developers need to be culled as well. Prior to market-liberalization, development was merely an arm of the state owned enterprises. They built what was needed for their workers and operations. They built spartan but high-quality. Private developers... there's big money in play and every incentive to cut corners. Consolidating this and raising market-entry requirements isn't a bad idea.
Residency reform. It's a growing crisis that's being ignored right now, addressing it immediately is contrary to the consumer-model. It works like this.
Say you have a farm and then have 2 kids. One kid does well at school, does well on their tests and goes on to college. The other, not so good at school and joins the army. Well, both of them lose their agricultural hukou. The first because it is transferred to the city of the college they attend and cannot be reverted back as they are expected to use their education. The second because soldiers should not be sent back to be farmers just on principle. It's possible to retain the land using some methods, but it's basically going to be done and gone. As old villages empty out, the local government seeks development deals to try and consolidate the rest into something of higher economic value. But what if you went to college to be a better farmer? What if you find yourself unable to land a decent job in the new city? What if after being a soldier you really can't find much else to do? Good luck, you're fucked. You might be able to rent some farmland, but it's not technically legal... ignored as it may be. You might be able to buy some farmland, but again, not really all that legal. Best you can do is form a company and petition a local govnerment for land usage rights. If that land just so happens to be occupied (legally or not), you're gonna run into some issues that require either payouts for legal owners, or bribes to evict the non-legal users. You'll see investment from the government because they want a share, but if things don't pan out as expected you find yourself in a rather sticky situation, what with all the promises and bribes you made.
Another thing, is that due to the rapid changes in land policy, who actually owns what is, at best, fuzzy. In many times, it's just verbal recognition with literally zero documentation. You might have been farming a plot for 30 years, but half of it technically is not yours. You'll want compensation though if that land is taken away, yours or not. Furthermore, if you own land, you are allowed to build a dwelling obviously. Any relocation or buyout of those land rights is increased to compensate for a dwelling. So those with small plots, obviously, built massive dwellings to maximize compensation. Unfortunately, any compensation isn't going to even come close to duplicate that dwelling, because it just can't. Quality of said dwelling does not come into account. So you get a lot of shitshacks built by people who have no idea what they are doing as cheap as possible. Disaster strikes and everyone cries about how their shitshacks fell down. Developer comes in and compensation for a shitshack parcel is much higher than a parcel with nothing, and the same as a well-built home. This is a major root cause in all those land disputes. Further amplified by community voting, wherein if 60% agree to terms, the rest are defaulted. So, as a developer, you pick the cheapest/poorest 60%, give a kickback to the local government to look the other way, and presto, you've fucked over people who should be getting more (but don't). To make it even better, those 60% won't get anything if the deal falls through, and once they sign off, they get partial compensation with the destruction of structures. If the remainder fights back, it's in their own economic interest to strong-arm their neighbors as they now risk losing everything. That being said, on the whole, it's a small percentage where this happens. China's a big place and most of the time it goes quite smoothly.
Currency appreciation and inflation... yep, another problem. Whining and bitching from the US has led to appreciation, while QE has resulted in inflation... US inflation is also exported in the form of goods (which are kept stable in the US market, to keep DC happy. But jacked up over here to subsidize the shortfall). The only solution is a very complex one that requires some finese to make happen. At the same time, China must:
Allow the currency to rise in value to keep the US happy
Move up the value chain and promote domestic brands, ensuring higher quality and trust, whole pushing them into export markets
Increase wages in a meaningful way
Keep savings rates high enough that people are not living hand-to-mouth, but low enough to spark more domestic consumption
Keep employment up through all of these shifts
Improve healthcare and education policies to help drive the value chain shift
The disconnect so far has, as much as they are rising, been wages and the cost of real assets far outpacing those increases in the major cities. 2nd and 3rd tier cities, it's far less of an issue. But 1st tier is where top talent gravitates, and 1st tier is where housing is expensive as all fuck if you want access to good schools and convenience. It's part of the hukou reform, as well as public housing projects to both hammer the market and add more supply. To me, at least, it begs the question, is it the duty of the government to accommodate with cheap housing for people who came and stayed by their own choosing regardless of individual capability?
At the same time, they are making some gigantic investments in national-level infrastructure. Why? Because it's cheaper to do it now than later, it's a jobs program, and because domestic logistics is already far beyond capacity in multiple areas. (Passenger rail has always lost money, freight makes bank. HSR "loses money", but increases freight capacity, and the freight profits more than offset the passenger "losses")
Oh, and there's also a funny game rich people are playing (because they are all fucking stupid), wherein they do an unofficial HELOC loan on a property, without realizing that the same loan has been made multiple times already on the same property. It works out ok as long as payments keep coming in... funny things happen when things don't pan out... like, who gets the property? At the very least, it's not the banks doing this and then packaging it off to the public and calling it investment-grade securities.... just private individuals who are fucking retarded and have too much money.
So no, it's not all roses, yes there are problems, but at least investments are made in actual real things that might actually benefit normal people. Overall, the legitimacy of the government is derived from the ability to improve things and get shit done that needs doing... but then it's also in the interest of the government to fudge stats, coverup failures and lie about accomplishments. In a democracy, legitimacy is derived from the "will of the people", but people are fucking retarded sheep and will believe fucking anything you tell them over and over again with an incentive again, to lie, fudge and corrupt. Same shit, different flavors, different piles, really just comes down to who lies less and who starts eating their own bullshit first.
spectacular post, laomei. worth repeating: "What IS a bad thing is when regulation is effectively written by those who would benefit from it financially. In most places, this is a case of severe corruption..."
Ah, Montesquieu got shafted by Machiavelli there!
Time and time again.
also worth repeating:
"The real issue is that it's a systemic problem. This didn't just *suddenly* happen. It's been headed this direction for some 40 years." And the need for the EUR was linked to that, and to 1971's Nixon Shock
"You can't really do that whole war thing again, as everyone you might want to cripple has nukes." oh, but this does not hinder Krugman and some "End of the World" believers to combine in an unholy alliance of fervent Greatest War wishers
"Sparking instability to crash other economies doesn't work all that great either, as whistleblowers are everywhere and leaking information is easier than ever." It still works on small and medium sized economies and currency zones, though, using the older toolkit of building "market consciousness". Hence the Think Tanks and the Financial News Propaganda
Laomei has produced some really good stuff here! One should read this! It touches on the fact that others after WW!! like Japan S.Korea, Germany and finally China under Deng Xiaoping got the Capitalistic message and began in earnest seducing heavy industry and manufacturing to come there!
We fat as cows ready to be butchered did not compete. We allowed the services industry and financial structures to expand under our massively growing Federal Government under both parties! This has nothing to do with Party! We forgot that it's a really competitive world out there.
Now America has no real Industrial Heavy production to speak of. Our Labor Participation Rate is at all time lows and we still lie to ourselves. Our middle class is dissappearing and our Federal government employees get "Double" in wage and pension what a Private Sector worker gets. Our Federal Agencies hate industy and tries to shut it down with EPA and NLRB regulation.
Our highschool kids are 18-38% unemployed and those industry jobs that we remember in the fifties and sixties are no longer there for them and yet our Central Government continues to change the subject and not compete! Thanks Laomei for your words.
SOME PROOF!
Japan under w Edwards Deming (look it up) became "Capitalistic" after WWII and competed! S. Korea copied them and competed, now China under Deng xiaoping competed. Look at them! We can obfuscate all we want and spin excuses.
Do you want the answer, after all we invented the answer in the late 1800's through the 1950's into the lower 60's!! It wasn't confined to a political party.
OUR STATES had few Federal Restrictions! They went out and brouight the bacon home for thei citizens!! Take Federal Restrictions away. Allow, without any Federal Agency restrictions, States to independently compete with no favoritism by the Federal Government and existing Agency rules. Within 7-10 years after we will have ful lemployment and good wages compared to the services wages we now have! We will regain our heritage!
Our middle class is dissappearing and our Federal government employees get "Double" in wage and pension what a Private Sector worker gets.
The problem here is not that they are overpaid, the problem is that everyone else is underpaid. Based on productivity gains, the median should be around $100k now as a conservative estimate. Federal pay is generally indexed to inflation and has regular increases for cost of living. Is it the fault of federal workers that the private sector has failed to keep up?
laomei, "The cold war was opportunistic bullshit based on lies and paranoia mainly used to solve the post-war problems."
yes, yes, yes... and a bit more complicated than that. then a communist or at least a socialist solution was indeed thought as a good thing for great parts of Europe and Africa
unlimited production by machines/capital and limited/restricted demand by humans/labour? (paraphrased & technically a straw man) you are on the cusp of Karl Marx's glorious & inevitable future (TM) with that, where then the first is expropriated by the second, and all problems are solved by opening the taps of both production and demand
and I think it's a tad too early. let's talk about that when a Toshiba robot tells the Nobel Prize committee that it is honoured but won't accept the Prize for Economics out of respect for Alfred Nobel's wishes and the sheer illogicity of giving prizes for Economics. and the GE robot next to it does not rip off his sensors pod for that
A pure commie solution technically speaking can work. However when under significant threat, it will fail. In commie wonderland, here's what happens:
Your house? Government gives it to you
Your job? Government finds one for you
Your healthcare? Government again
Your education? Government provided yet again
Your retirement? Paid for by the government
It works as long as you're willing to accept relative stagnation. And that only works if things are fairly nice on average to start with. Generally speaking, in China, the first generation in loved the shit out of it all. It was genuinely good stuff. That revolutionary spirit fades over time... it does regardless of the system. The easy fun part is over, and it comes down to the day-to-day paper pushing. That nirvana, where everyone has everything they need and national endeavors are persued simply because a bunch of people get together and want it to happen. Is countered by those who just want to sit back, enjoy life and do nothing.
It's the oldest problem really. The problem can only be solved once EVERYONE is on board and there is no other real option because there is no alternative model in the public consciousness. Also, by definition, any attempt to be counter must be met with force. It takes the stance that all workers are equal as everything is interconnected with all parts required to make the whole. Therefore, all must be treated equally. Who ensures this equality? Ideally the people themselves. But who determines the standard for equality? What's the variance tolerated? If I can be a farmer or a doctor or a teacher or a bus driver and see the same benefit, obviously I'm going to gravitate towards the least demanding option... unless I'm forced based on recognized abilities or trained without choice to meet society's needs regardless of my own preferences. In which case, not a single fuck shall I give about my work. What about incentives? That upsets equality and if doctors are in high demand this year and get bigger homes and nicer cars, what about the doctors from last year? Fucked apparently. The model only works when supply-side is at an advanced enough level where all can basically have all they'll want/need within the system and a token monetary system is provided to allow for variance and personality.
There's still stagnation though, resources are still limited, talent is not equal and inputs are sitll required. So it's a bit of a quandry. A system which assumes infinite growth, or a system which assumes infinite resource to maintain parity. One reliant on inequality as a driver, the other reliant on isolation as a driver. Adam Smith, Krugman, Marx... no one has the answers. Marx also never really did either, he just looked at capitalism and saw the problems. Everything after him has been an attempt to find the solution. Short of a massive devastation where the handful of survivors can make due as hunter gatherers and give no fucks about anything apart from the next meal... it's probably not going to be solved for a very long time.
We had labor arbitrage, first from the nations recovering from WWII, then from the emerging world. That took a bite out of our 1950s' world order. We then used debt increases as a stopgap measure to make up for what purchasing power was lost by the underbid workforce. Everything is a symptom of trying to address increased efficiency. China now is using massive debt increases to try to avoid dashing the expectations of the not-yet-rich, but no longer needed workforce. Soon enough we'll be reaching the first singularity, which is labor singularity. What's everybody going to do? So far in the West, we've tried to pretend one answer is social media, but while that helps pacify and kill a lot of cradle-to-grave time, it doesn't provide many jobs.
If we toss away the things that have made us more comfortable, those things that supposedly raised our "standard of living", we might again find a purpose for all the redundant people, but is that where we want to go? Is there another alternative? If it is "buy local, and bring the jobs home", then we are saying each of us owes not all humans, but only those born within the same boundaries as us. In other words, a New Yorker says, "Sorry Canada, I'm obliged to buy what that guy much farther away in San Diego produces." Also, is a whole lot of frustration and anger aimed at the symptoms (debt) and ignoring the underlying cause, which is human redundancy?
A lot of people here evidence the kind of anger that comes from believing one has the solution, but whose solution isn't being adopted. Personally, I don't have a solution to what really ails us, and I am dubious that an answer even exists. We could adopt a gold standard tomorrow, close every central bank, and outlaw fractional reserve banking, but not a single Greek would get a new job. There's no magic elixir. I suppose we'll all end up suffering some kind of diffuse outrage, then slaughter enough of each other so that labor regains pricing power and we have a lot of destroyed things to rebuild. It does seem a high price to pay.
Yep. Marx was as lazy as everyone else. It's easy to identify problems, very difficult to actually find the solutions. Whine bitch and moan about the government in China all ya want. But even if growth collapsed and the economy stagnated... overthrowing the government (and the glorious bloodshed/civil war that follows) isn't going to magically fix anything. Even a peaceful transition won't make ANYTHING better. Literally nothing would get better. Been there, tried that, over and over and over again. In fact, with inequality being an issue, any forced transition would most likely veer to the far left, and in the process make things far far worse. Nuke automation and do everything the hard way again? It's like that video of a horse fucking a man to death... some things can never be unseen.
The US was more powerful than the British in the 19th Century ?
Really ? Why is the UK (now) still called Great Britain (as it was then) ? Great USA anyone ? Don't think so.
Let us know when you kick butt in Dehli, Peking, Russia, Europe and oh yeah - Washington.
Factually not correct in history terms
WOW!! from all that....you want to go with "my team is better than your team" arguements??.....
The Great in Great Britain refers to the whole collection of the British isles and all the nations within.
It's like the Greater in Greater Manchester.
HTH.
China was like North Korea is now
Then the pig pong tounament -- see Forrest Gump
They were weird with Mao Jackets. And totally unpredictable. Except when MacAurthur crossed the
Yalu river ---- no longer would they be subject to gun boat diplomacy -- See the Sand Pebbes
And when China invaded North Vietmam in 1979 which by then was North & South combined,
it set the sage for peace in SE Asia
My understanding is that a Chinese man can read & understand a Japanese newspaper and vis versa
But they can not understand the language ---- China hates Japan - The rape of Nanking
I think there's much more than Economics and Finances to fight for. Life seems to be at stake. I'm just gonna quote a post I've read on Enenews website, wich makes a lot of sense to me and matches with readings, studies and reaserch I've done:
He wrote:
We are the "3-11 truthers" who refuse to believe the Big Lie.
Most people want to believe that our government is benevolent and that the country is "exceptional." These people fail to understand that the country has been taken over by a handful of huge multinational corporations.
These people need very much to avoid the cognitive dissonance that would result should the idea threaten to break into their consciousness that maybe our country is no longer run for the benefit of the citizens. Indeed, the new "citizens" are multinational corporations.
The thought that our country has been taken over by financial cabal allows these corporations to make huge "official" misrepresentations to force the real citizens into the painful dilemma of either accepting the huge lie, or facing the corporate coup and the terrible implications. One implication is that a good, brave citizen would take action against those whose crimes accomplished the coup. They read about the Founding Fathers but cannot understand that only 3% actually fought the British.
A Zen syllogism might be: "If Kerosine can melt steel, why cannot three nuclear meltdowns escape concrete." (Shows contradictions).
The point is that official explanations of 9-11 and 3-11 are readily accepted to avoid understanding that multinational corporations have taken over and care nothing about people other than themselves and will do anything.
In 2008 bankers and crony capitalists began their final looting of America by creating all sorts of bogus reasons for the Fed to print currency and hand it to them. TARP, QE, and all the other Fed "asset purchase" programs are cover stories for looting the nation.
In the process Fed is destroying the value America's only real export, the US dollar. When the dollar dies, America dies with it, because we have nothing else much to export, and no, America isn't self-sustaining.
China is doing what America did in the 20 years after WWII, becoming the world's #1 manufacturer and exporter. It's what made the US a superpower economically, and will make China a superpower economically.
So on the economic front, China is rising and America is falling.
China's trade surplus maintains demand for China's currency thereby maintaining its value. They also take in boatloads of US dollars which they can sell on Forex in exchange for their own currency, keeping the value of their currency up and reducing the value of the dollar.
They've bought over a trillion dollars of US govt debt thanks to their massive trade surplus, and that trillion dollars of US govt debt is losing value as the dollar loses value.
Sooner or later they'll have to sell all that debt, but there's no market for it. Fed would buy it, but they have to print a trillion more dollars to buy it, further reducing the dollar's value, so China loses either way.
The US govt has no way to pay China that trillion dollars back. That's defacto default, and that's how world wars start.
But not just yet. Wait till the US dollar collapses and the American military can't operate around the world anymore.
And maybe help it collapse by introducing a gold-backed currency.
America isn't just in decline vs China. America has already lost vs China. The borrower is servant to the lender.
Very well thought out...
though I don't see mention of oil. We won the 'big one' because we controlled the fuel. And, still we control oil and fuel...oh, um, nevermind.
It is possible we are talking about a weak America rqather then a strong China. how China deals with its problems going forward is important. any of us who has had to write off a massive big debt will tell you it is not empowering but weakens you financialy.
This is too oversimplistic and the US has plenty of exports both in terms of raw commodities and finished services/products it 'exports.' Your right about the US standard of living though once it loses the global currency privileges and the US has to dramatically right-size it entitlement systems and defense spending.
The reason the US is going 'broke' is because we spend over $1.1T on defense and defense-related items and have a crazy set of wealth transfer payemnts to the elderly for SSI, Medicare, and Medicaid whose single biggest expense is assisted living facilities for the elderly. If you go to almost any part of the US, the age group living in the high rate of poverty is children under the age 16. Wealthiest is the elderly and this is almost a complete role reversal before Medicare was passed in '65.
Some say raw GDP data aren't relevant for power status, China is still a nation dominated by peasantry, their political system is inherently unstable etc. This is all wrong. As Cicero said, the sinews of war are infinite money. China doesn't need a 'middle class', consumerist or not, to dominate the world stage. What it needs is a military to match its rivals, and military spending is and always has been a function of absolute GDP. Thus as soon as China GDP outgrows the US, while both spend the same relative amount on the military, it will be a matter of - short - time before China is calling geopolitical shots, too.
Still, Americans have been brought up with their Number 1 pathos, and delusions of benevolent grandeur. Well, they can keep them. The rest of the world should allow the Americans their narcissistic delusions of 'superpower benevolence' - an oxymoron if ever there was one - while quietly moving on to a new global configuration where unilateral wars of aggression, unquestioning support for a terrorist state of ethnic paranoids, stuffing worthless fiat through the world's throats, and all the other trapping of 'superpower benevolence' have become all but impossible.
Military domination is one route, but it's destined to fail. It was one thing when you show up with armor and guns against natives who have sticks and rocks, easy as hell to domesticate those "savages" and enslave them. Empires reliant on military strength breed resentment and do little more than spark an arms race, as the empire is reliant not on the military itself but force multipliers. Those start vanishing as soon as the hand has been shown and compensations are made.
A long-lasting domination with strong roots is economic. Willing participants don't fight back as much as long as they see economic advantage. The US economy is, at this point, based on a weird incestuous relationship involving military and finance. Everything else is "IP" dominated, and fuck me it's gotten rather stupid in recent years with arguments over who made a thing a rectangle first and who made a thing a certain color first. GDP alone isn't enough, quality of GDP is a better measurement. Say there are 2 identical CNC machines with the same settings and same exact inputs, one in China, one in the US. China makes a widget and the US makes a widget and they are identical, but the China widget sells for $5 and US widget sells for $50... honestly, does that count as "GDP"? It's the same fucking thing, same quality, but one side gets to claim more credit for it. Sure, the market might decide it's a fair price in either market, but it's still stupid. Some middleman sees this difference, and starts buying the $5 widgets, selling them in the US now for $40. That $35 of US GDP comes from where exactly? Out of thin fucking air. Nothing is added, it's all just smoke and mirrors. . Same thing goes for all those "financial products". Nothing of any actual value is ever created, it's just money passing around from one hand to the other, tacking on GDP as it goes, finding suckers every step of the way. That money has to come from somewhere, and based on GINI figures, it seems to be coming from the bottom and moving up to the top in rapid order. Unfortunately for society, the rich don't spend nearly as much as they should. There are only so many cars one can buy, only so many meals one can eat, and only so many maids, cooks and drivers one can hire. All that money by the way, is coming straight from the pockets of normal people living hand to mouth. The excess is dumped into whatever can generate returns... most have no fucking clue into what exactly, in fact, for tax purposes, it's best if they don't know. A good chunk of it based on nothing but purestrain bullshit.
ANYWAYS... gdp is bullshit until it has been significantly revised. Once that whole game falls apart the world will be a much nicer place.
"...the sinews of war are infinite money." WRONG/Quote misuse ALERT! Doom and Dust...PLEASE! Don't give quotes without understanding the context It's a cheap and nasty trick that likely is causing Cicero to spin what's left of himself in his grave. ----Cicero was speaking against providing currency to Antony in his use of Roman Legions in Gaul (France/Switzerland (trans alpine gaul). ----Cicero WAS NOT talking about fiat currency or QE or bond buying or anything on YOUR agenda. ---- Below is the whole quote but go to Gutenberg online to see the entire speech which is masterful. Cicero to the Senate urging the outlawing of Marcus Antonius (Mark Antony) rather than negotiating with him: "What else is that but supplying an enemy with all the arms necessary for civil war; first of all with the sinews of war, money in abundance, of which he is at present destitute, and secondly, with as much cavalry as he pleases?" BTW: Cicero, don't forget, is the guy who raises Octavius up to the Senatorial class and inadvertently gives cover in this way to the man who unofficially ends the Republic.
Why should we care about the fate of a bankrupt empire?
Let's get Civil War 2.0 over with.
Author Mark Steyn said when the global power and wealth baton passed from Britain to the US, nobody noticed. Two anglophone nations that were virtually identical ensured a more or less seamless transition as far as the rest of the world was concerned. Britain, and then the US, have been at the top of the world for, essentially, 300 years. That's now over.
When that baton passes to China, it's a whole new ball game.
Mark Stayn is a shithead BS artist, his show is nonstop garbage.
eliteist ivory tower gibberish
WHEN YOU GOT THE FUCKING HAMMER USE IT .... (KNOWLEDGE GARNERED GROWING UP IN THE BRONX)
Reading this made me realize that if I cut off my hands and feet, I won't have to worry about clipping my nails.
Winning!
Whatever ails America certainly is more so in China. I always laugh at that book by the NY Times author, World Is Flat, what is his name Tom Friedstein, he says in China kids are so much better students. What a crock of shit! I know firsthand the kids in China, Vietnam, Thailand, etc, after they are running rote-memory projects at school come home and go straight to the video games. The thing that troubles me about USA is the heavy use of drugs.
What troubles me is your constant insanity and inability to discuss the truth.
I post insight based on personal experience. Do you think Chinese kids spend less time staring at video games than Americans? LOL land of video addicted kids is Asia they put the rest of the world to shame.
What do you think of the bloke above quoting Mark Stayn? Now there's a load of bollocks.
Rather than being troubled by my insight please post your own independent opinion of the story herein.
"To begin with, hegemonic transition periods have historically been the most destabilizing eras in history."
Cycle lows do have that effect.
"Still, on balance, the U.S. has been a positive force in the world, especially for a unipolar power."
Did the author manage to keep a straight face when writing that? This idea of American Exceptionalism has made us the laughingstock of the world.
Let's see here...China, a communist command economy, grew >90% since the economic collapse in 2007-2008.
And the US, an economy worshipful of the capitalist model, grew 1.5%.
Not to worry! China is copying our wealth inequality model and is generating a vast gap between thier large number of millionaires and the workers/consumers!
So it is all good, right ZeroHEdge?
About capitalism: When you burn your hand on a hot stove do you then make sure it is evenly cooked by fliping it over to cook the other side...or do you pull back? Hmmm?
This is a dilemma only for you Zero Hedge zombies.
Growth of a modern economy in China was placed on steroids when America decided to make it a rival to the Solviet Union in the 70s. Like the Solviet Union in the 1980s I think we far overestimate the power of China or how well it is put together. Currently a 6.6 trillion dollar spending spree used as stimulus to combat global economic slowdown is coming back to haunt China. This has greatly expanded credit and created huge overcapacity during the past five years. A massive debt crisis now looms in the offing. Companies struggle to repay laons taken to build factories that sit idle for lack of demand. More on the current woes facing China in the post below.
http://brucewilds.blogspot.com/2013/11/china-land-of-overcapacity-and-de...
Problems happen, solutions are found, opportunities are uncovered. Companies going under and resources being repurposed is the natural order of things. As long as it's in the right place with the right infrastructure supporting it, it'll be fine. I think the world seems to have forgotten the critical thing about investments... not all of them succeed, that's why there's interest.
That is magical thinking.
Which "God" is it that will set things to rights? What are the correct offerings?
If you study history, even but a little, then you might start to suspect just how bad "fine" can be.
It works out fine as long as shit's not systemic. In fact, those low-value chain factories are being killed off basically on purpose. There's also no real shortage of investors willing to take massive gambles with huge potential rewards. China's basically decided it's done with the low-value bitchwork on behalf of others and transitioning away from that model.
laomei, there is a fatal flaw in capitalism and a market economy that you're not grasping. The system must exploit the worker by depriving him of the profit he generates through his labor. Yet the system expects the workers to also be the consumers. Profit taking must lead to a cycle of lower wages leading to decreased demand leading to increased unemployment leading to more people looking for work leading to more wage cuts and less consumption...the decline stops only when subsistence wages are reached.
Socialist systems that either meke the workers the owners (Mondragon) or that attempt to tackle the problem via progressive taxation/redistribution must be implemented. Mondragon is the rare exception. The West has embraced the use of taxation which creates an unrelenting tension where the rich ultimately weasel out of the tax. China is confronting this now. That is the problem.
Regarding Han Chinese, Germans are a mixed group too but that is hardly the point.
:0
Absolutely, AT. China's military is -currently- nothing to get to worked up about -if- you don't have a large border with them (India/Russia) or have a close proximity (Japan, South Korea, Taiwan etc).
But China is dangerous to the world economy because it is, itself, playing with fire (capitalism). As the selfish drive to get the elite's children well placed and well banked plows forward, the Oligarchs of that country are abandoning their people and their people know it. Tick tick tick goes the time bomb of social unrest and revolution.
Looking over their shoulders at the overworked and broken people they are charged to up lift, the oligarchs start to feel NERVOUS! Can any clique last for long when they leave millions and millions of fellow citizens in poluted, sloppily built ghettos surrounded by idle factories?
How angry the Chinese worker must be when he or she realizes that the birth defects and the cancers and the cough are all THEIR sacrifice alone and the Party bosses have fled the field in Mercedes and Bentleys?
THe capitalist system has always generated vast wealth inequality over a given cycle that then leads to ultimate destruction and then wealth redistribution (and lots of blood shed). The oligarchs chose a top down, elitest model where they play factory boss and investor capitalist and they know that their blood will be called for if the situation is not refocused from them toward some other "enemy of the people".
War, the threat of it and the militarization of the nation represent the end-cycle escape valve for China...that is what we must fear.
I hope ZH readers can grasp that Capitalism holds no solution to the problem China faces with over capacity to produce and grinding poverty via wage declines. Capitalism always creates these issues, given time,and our own weak/insufficient socialism, coopted by the wealthy, is leading to the same wealth inequality here it the west just at a slower pace. I expect the west, too, will be calling for confict to redirect the anger of the people over the next few years.
Thanks for the great link.
Something nobody seems to talk about is the "One Child" policy and the large numbers of baby girls murdered by parents in China. Talk about a freakshow nation. Aside from the morality of their people, lets talk about a country with more men than women. As a high testosterone individual myself, I can say that large numbers of men not getting pussy inevitably leads to some destabilizing force but I am not sure how it will pan out.
Yet another great point and a clue to the upcoming conflicts.
Here is an interesting dilemma for the Han "Master Race": What happens to their ethnic/racial supremacy theory/acceptance after their sex starved men/armies break out of China and flood the region? All those mixed Han children will have fathers that bond with their children who are no longer just Han. ...that makes these racial ideals which are popular in China threatened by a colonial-style push for empire. That might keep the Han oligarchs from getting too expansive? Just a thought...
"Han" is a melting-pot of an ethnicity if you understand the history of the region.
Historically maybe but not necessarily today. What does get overlooked is how many ethnic groups there are in China today who aren't 'Han' though.
China is nearing another 'MAO" populist revolution! The USSA has kept its eyes on the ME, ie. Iran, for so long... that Russia and China have made tremendous inroads in various emerging economies.
The Russian's are just about at the apex of ruling the 'New World Order' energy pipeline. And they are the nuclear equivalent to the USSA! China must feed off of Russia if it wants to grow both militarily and internally?
Funny, since Reagan vested the USSR to the trashbin of history in (~22 years ago, strange?) 1991, he also clensed Moscow of the old cold-war warriors-- unfortunately, for the USSA, they have grown exponentially, as the KnEw 'Czar?Oligarchy?Fortress?Ruling?Dem/Rep'?Theocracy`Class'! Made up exclusively of the top 1% or in AWE`reality,`thy-topsy-0.0001%!?!
The USSA has a contextual reticent delimma? That being all the freebies of a cloned 'Socialist/ Democratic Society', as we dumped capitalism in 2008 for an unorthodoxed Kenesian "Centralized Market of Wonton`Manipulation' in order to save the system from its temporary paralysis... only to create twice the deficit in half the (~ $8tn... now ~$16tn WOW!) time rather than taking our medicine, and letting freedom run its course!
The world laughed at us, period! WTF!!! Have the American's gone mad?
Bush #43 has destroyed the USSA, along with Obama following sridently,... yes stridently with a full armitage of Bush League Warriors, via poisonous Ross and Levy, etel, carried-over the red?line of contention, via 'Cowboy (full-frontal retardation foreign policy) Diplomacy Footprints! Shoot first and ask questions later, the Netanyahu ? pierced weight style, 'of an albatross torso on BushObi!'s`fork'd`tongue , keeps the, Rhetoric Bay'd?'?!? All this, after the perpetrator has fled the (ie. Egypt, (yes Syria 2008?) Syria, Iraq, and now Iran? ,.. Libya got left somewhere?) scene, leaving the `ENTIRE Middle-East' on the precipice of civil war.
Yeah, the USSA deserves great credit for acting unilateral for the last twenty-something years or so, and look what it has gotten this once humble and caring nation, a unholy dose of incurable absolute power, fast becoming yours, and OURs, greatest nemisis?
Onward, and forward comrades,..
The 'AIPAC'!!! Yes, the (ogre...) AIPAC annual Policy Conference of 2014 will never let the, 'Iranian Geneva Nuclear Agreement' with Iran stand! They control our country and our children's children's future! Watch what happens after the 'State of the Union Address' is gone-by-the-wind... and our Israelite rulers have their USSA Right-Wing and Moderate Congress lapping at their feet March 2-4, 2014 at the ~70% Congressional fucktwats show-up for the "Policy Conference" (get your seats fast... one need not worry if a dual citizen?) with a few SA Sheikh's (BandarBush?) holding Fundalmentalist Salafist Poster's?!?
jmo
thankyou Tyler
HOTT Illuminazis
Weishaupt's Order 1
Weishaupt's Order 2
Weishaupt's Order 3