This Is How Empires Collapse

Tyler Durden's picture

Submitted by Charles Hugh-Smith of OfTwoMinds blog,

This is how empires collapse: one complicit participant at a time.

Before an empire collapses, it first erodes from within. The collapse may appear sudden, but the processes of internal rot hollowed out the resilience, resolve, purpose and vitality of the empire long before its final implosion.
What are these processes of internal rot? Here are a few of the most pervasive and destructive forces of internal corrosion:

1. Each institution within the system loses sight of its original purpose of serving the populace and becomes self-serving. This erosion of common purpose serving the common good is so gradual that participants forget there was a time when the focus wasn't on gaming the system to avoid work and accountability but serving the common good.

2. The corrupt Status Quo corrupts every individual who works within the system.Once an institution loses its original purpose and becomes self-serving, everyone within either seeks to maximize their own personal share of the swag and minimize their accountability, or they are forced out as a potentially dangerous uncorrupted insider.

The justification is always the same: everybody else is getting away with it, why shouldn't I? Empires decline one corruptible individual at a time.
3. Self-serving institutions select sociopathic leaders whose skills are not competency or leadership but conning others into believing the institution is functioning optimally when in reality it is faltering/failing.

The late Roman Empire offers a fine example: entire Army legions in the hinterlands were listed as full-strength on the official rolls in Rome and payroll was issued accordingly, but the legions only existed on paper: corrupt officials pocketed the payroll for phantom legions.

Self-serving institutions reward con-artists in leadership roles because only con-artists can mask the internal rot with happy-story PR and get away with it.

4. The institutional memory rewards conserving the existing Status Quo and punishes innovation. Innovation necessarily entails risk, and those busy feathering their own nests (i.e. accepting money for phantom work, phantom legions, etc.) have no desire to place their share of the swag at risk just to improve sagging output and accountability.

So reforms and innovations that might salvage the institution are shelved or buried.

5. As the sunk costs of the subsystems increase, the institutional resistance to new technologies and processes increases accordingly. Those manufacturing steam locomotives in the early 20th century had an enormous amount of capital and institutional knowledge sunk in their factories. Tossing all of that out to invest in building diesel-electric locomotives that were much more efficient than the old-tech steam locomotives made little sense to those looking at sunk costs.
As a result, the steam locomotive manufacturers clung to the old ways and went out of business. The sunk costs of empire are enormous, as is the internal resistance to change.

6. Institutional memory and knowledge support "doing more of what worked in the past" even when it is clearly failing. I refer to this institutional risk-avoidance and lack of imagination as doing more of what has failed spectacularly.

Inept leadership keeps doing more of what once worked, even when it is clearly failing, in effect ignoring real-world feedback in favor of magical-thinking. The Federal Reserve is an excellent example.

7. These dynamics of eroding accountability, effectiveness and purpose lead to systemic diminishing returns. Each failing institution now needs more money to sustain its operations, as inefficiencies, corruption and incompetence reduce output while dramatically raising costs (phantom legions still get paid).

8. Incompetence is rewarded and competence punished. The classic example of this was "Good job, Brownie:" cronies and con-artists are elevated to leadership roles to reward loyalty and the ability to mask the rot with good PR. Serving the common good is set aside as sychophancy (obedient flattery) to incompetent leaders is rewarded and real competence is punished as a threat to the self-serving leadership.

9. As returns diminish and costs rise, systemic fragility increases. This can be illustrated as a rising wedge: as output declines and costs rise, the break-even point keeps edging higher, until even a modest reduction of input (revenue, energy, etc.) causes the system to break down:



A modern-day example is oil-exporting states that have bought the complicity of their citizenry with generous welfare benefits and subsidies. As their populations and welfare benefits keep rising, the revenues they need to keep the system going require an ever-higher price of oil. Should the price of oil decline, these regimes will be unable to fund their welfare. With the social contract broken, there is nothing left to stem the tide of revolt.

10. Economies of scale no longer generate returns. In the good old days, stretching out supply lines to reach lower-cost suppliers and digitizing management reaped huge gains in productivity. Now that the scale of enterprise is global, the gains from economies of scale have faltered and the high overhead costs of maintaining this vast managerial infrastructure have become a drain.

11. Redundancy is sacrificed to preserve a corrupt and failing core. Rather than demand sacrifices of the Roman Elites and the entertainment-addicted bread-and-circus masses to maintain the forces protecting the Imperial borders, late-Roman Empire leaders eliminated defense-in-depth (redundancy). This left the borders thinly defended. With no legions in reserve, an invasion could no longer be stopped without mobilizing the entire border defense, in effect leaving huge swaths of the border undefended to push back the invaders.

Phantom legions line the pockets of insiders and cronies while creating a useful illusion of stability and strength.

12. The feedback from those tasked with doing the real work of the Empire is ignored as Elites and vested interests dominate decision-making. As I noted yesterday in The Political Poison of Vested Interests, when this bottoms-up feedback is tossed out, ignored or marginalized, all decisions are necessarily unwise because they are no longer grounded in the consequences experienced by the 95% doing the real work.

This lack of feedback from the bottom 95% is captured by the expression "Let them eat cake." (Though attributed to Marie Antoinette, there is no evidence that she actually said Qu'ils mangent de la brioche.)

The point is that decisions made with no feedback from the real-world of the bottom 95%, that is, decisions made solely in response to the demands of cronies, vested interests and various elites, are intrinsically unsound and doomed to fail catastrophically.

How does an Empire end up with phantom legions? The same way the U.S. ended up with ObamaCare/Affordable Care Act. The payroll is being paid but there is no real-world feedback, no accountability, no purpose other than private profit/gain and no common good being served.

That's how empires collapse: one corrupted, self-serving individual at a time, gaming one corrupted, self-serving institution or another; it no longer matters which one because they're all equally compromised. It's not just the border legions that are phantom; the entire stability and strength of the empire is phantom. The uncorruptible and competent are banished or punished, and the corrupt, self-serving and inept are lavished with treasure.

This is how empires collapse: one complicit participant at a time.

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drendebe10's picture

Sounds like the USSA has arrived!!!  YeeHaaa!!!

Arius's picture

We are still in the building up phase .... generations to go before the start of the decline ... if ever

Obama_4_Dictator's picture

LOL...you are smoking some good shit

lordylord's picture

I think all of us at Zero underestimate the ability of the economy to just keep dragging along without a collapse.  It will happen, but nodoby knows when.

NoDebt's picture

Rome wasn't built in a day.  Nor did it collapse in a day.  You could have been living during what is now the commonly recognized period of it's decline, and if you picked the right 50 year span, you'd think things were still going just peachy.

Overfed's picture

Things move a whole lot faster these days.

THX 1178's picture

The quickening, or as RAW calls it, the Jumping Jesus Phenomenon...

https://www.youtube.com/watch?v=svRJ7lDpSB0

weburke's picture

selling in summer 2015 sounds about right.

Flux's picture

Meh, this doom porn is old hat.

What would Buffet do?

"What I advise here is essentially identical to certain instructions I've laid out in my will. One bequest provides that cash will be delivered to a trustee for my wife's benefit. (I have to use cash for individual bequests, because all of my Berkshire shares will be fully distributed to certain philanthropic organizations over the ten years following the closing of my estate.) My advice to the trustee could not be more simple: Put 10% of the cash in short-term government bonds and 90% in a very low-cost S&P 500 index fund. (I suggest Vanguard's.) I believe the trust's long-term results from this policy will be superior to those attained by most investors – whether pension funds, institutions or individuals – who employ high-fee managers."

 

Good luck with the end of the world, I'll be enjoying the opera.

TheReplacement's picture

Do you realize he doesn't have long to live and during that time he can probably count on a bailout if his bet goes belly up?  Do you have the same insurance?  Yeah, didn't think so.

TruthInSunshine's picture

Buffett is the son of a Senator who received 17 billion USD in bailouts from taxpayers (involuntarily extracted, thank you taxpayers) just in the last 5 years to compensate him for his losing stakes in loser companies/wards of the Fed that he and his equally criminal partner, Charlie Munger, held large stakes in.

He's a career criminal, disguising himself as a genteel, wise grandfatherlytype, when he'd happily shiv someone over a dime.

Anyone who believes in the mythology of Buffett as presented by a bought off financial media & as the bleeting sheeple do has gone full retard (and flux can't even spell Warren's last name correctly despite his idolatry/worship of him).

old naughty's picture

"Perceptual Speedup"

"...the minimum needed to maintain the system also rises..." Yes!

The reckoning is near, bros.

zhandax's picture

THX, you are are making me think too much.  He references the technological singularity in that vid.  From a bit of further reading, it appears this is derived from Hawking's singularity theory.  As this old finance major understands that, when the exponential function hits criticality, the laws of physics cease to apply.  Matter can be compressed, light can emit from a region with infinite curvature, dogs and cats sleeping with each other, etc.  We have all assumed that when the exponential function hits criticality in debt creation, the whole economic universe will implode.  What if it works in the opposite direction?  I may ponder that for a couple of days, and then switch to a higher proof°.

Flux's picture

Ah, yes...

The genuine idolatry of one unable to spell his worship's name correctly.

Got straw dog?

Or are you still waiting in line for your food stamps?

You can catch me at the opera. If you meet the dress code.

Cheerio!

hobopants's picture

Warren Buffett admitting that the market is a fraud would be the same as a pastor saying there is no God. The man has to believe it, or at least pretend to otherwise he is as much as admitting to a life of crime. You go ahead and follow that advice and see what happens. I'll bet the actual trust says something akin to "Whatever you do, stay the hell out of the stock market!" 

SAT 800's picture

Agreed. Also Martin Armstrong agrees. So now there are three of us.

markmotive's picture

 

Our friends at Al Jazeera put together a solid documentary on the Decline of the American Empire

http://www.planbeconomics.com/2013/11/documentary-decline-of-american-em...

gmrpeabody's picture

Al Jazeera..., now there's a piece of work... (not)

zhandax's picture

Oh, come on.  Algore's legacy to the 'murican peoples? /s

Anusocracy's picture

Empires decline and fall because of changes in the ratios of various types of mindsets.

A beneficial evolution in the make-up of a population reverts back to a more primitive state thereby undermining the cause of its advances.

Mother Nature doesn't let her children go without a fight.

Bunga Bunga's picture

It's not a  question of virtual thinking but of real ressources. All failing civilizations have that in common:

http://www.scribd.com/doc/212538392/A-Minimal-Model-for-Human-and-Nature...

 

 

G-R-U-N-T's picture

5."As the sunk costs of the subsystems increase, the institutional resistance to new technologies and processes increases accordingly"

There's a good article in the WSJ that parallels this very point:

http://online.wsj.com/news/articles/SB1000142405270230427990457951569079...

excerpt:

"The agency's broad mandate reveals the mind-set of ObamaCare's authors. The premise is that the federal government is best positioned to lead an effort in innovation in medical delivery, despite all evidence to the contrary. The history of Medicare's payment systems over four decades is one of politicized decision-making by regulators, protection of incumbent providers, and roadblocks to new medical technologies and new ways of doing business, such as using information technology to consult with patients, or employing non-physician clinics for routine patient care. It's the opposite of an environment conducive to innovation. Consequently, inefficiency is rampant in Medicare's traditional fee-for-service program."

 


SAT 800's picture

I love external toothed star washers; a real engineering marvel; they do the job !

DaveA's picture

Information != Knowledge. The fact that the number of duck-faced female selfies on Facebook doubles every three months does not mean that the Singularity is nigh.

Midas's picture

Wisdom is the domain of the Wiz.

piceridu's picture

It is estimated that a week’s worth of New York Times, which is just 7 newspapers, contains more information than a person in the 18th century came across in an entire lifetime. It is also estimated that 4 Exabyte's (4 billion gigabytes) of unique information will be generated this year alone.  This is more unique information generated than the previous 5000 years combined. 

Ben Dover's picture

And how much of that is the government set to harvest? Bout 137%?

matrix2012's picture

LOOONG Seagate Technology and Western Digital...

more storages are definitely needed by Ed Snowden's former employer to archive all the bytes in this planet!!

TheReplacement's picture

Recording every instance of "the", "lol", and ":)" does not make for a lot of knowledge.

McMolotov's picture

I think Hemingway would tell us that, like going bankrupt, empires collapse two ways: gradually, then suddenly.

Ignatius's picture

CHS is WRONG on his very first point.

The education system (which is huge) is yielding EXACTLY the results intended from the inception of compulsory public schooling.  See John Taylor Gatto for reference to the founding principles of public schooling.  Gatto cites the original documents/lectures and their purpose.

I stopped reading after that.  CHS is a prolific simpleton.

Tapeworm's picture

"CHS is a prolific simpleton"

 He is not a simpleton for merely phrasing a point in the way that you disapprove. I'll bet that I have many more Gatto books than you do and yet I donate to CHS blog because he reaches a fair amount of thinking people that might pile on to make a difference in this rotting place.

 I did vote you up anyway for your point on what Gatto has shown to be the truth.

 My best to you.

edit..........

 I find it to be counterproductive to our cause to blithely dismiss those that do not have 100% ideological purity, whatever that might be.I do not agree with CHS on some issues yet I still pay a very little to help him get his views that coincide with mine put up for public consumption. I would be proud to have him as a neighbor and I'd argue your point with him if the occasion arose. That is not the way that it is so I kick in for those that I find to be worthy, and that includes this joint.

 Have you donated five or ten to ZH lately? I will do it again now that I have exhorted y'all to do the same, ya cheap bastards.

Ignatius's picture

Point taken.  I too have enjoyed CHS, but I find more lately that his analysis has been missing some key elements.  His discussions on the Deep State comes to my mind where he seemed to be claiming more authorship of the concept than he deserves.  And there again I recall he left out what I'd consider essentials to Deep State discussions (political murders and mass murder, 'strategy of tension', narcotics, etc.).  This is from memory....

I am NOT an ideologue, whatever I am, so it's not "purity" but accuracy that I expect. 

Yes, "prolific simpleton" was lazy on my part though I'd prefer accuracy over volume.

I don't donate to ZH, but I do 'suffer' the ads which bog down my computer and do donate to various other alternative media.

Best to you.

cougar_w's picture

NoDebt and Overfed are both correct.

disabledvet's picture

See below and "i have this really cool idea for our March on Moscow this Winter Mr. President. Here's the video feed:

http://www.youtube.com/watch?v=WASr5-mS238

ignore the "rebel" part Mr. President.

I think we can do this for...

a couple of...hundred...billion."

Stuck on Zero's picture

The USSR collapsed so fast that the media and intelligence agencies were shocked. Tens of thousands of Soviet soldiers had to get their families to pay for their plane tickets home from the far reaches of the empire. 

 

SAT 800's picture

Very true. And not at all widely known.

fallout11's picture

...but yet obvious to insiders for nearly a decade before the end. Glastnost and Perestroika (and other Gorbachov reforms) were the last, desperate attempt to change the failing system. Those who didn't see it coming, and there were many whose heads were firmly in the sand, were either not looking or were being willfully naive/ignorant.
"It is difficult to get a man to understand something, when his salary depends upon his not understanding it." - Upton Sinclair

OceanX's picture

"Things move a whole lot faster these days."

That is so very true, consider this: Before the invention of the telegraph, information could travel no faster than a human being.

 

 

Twodogs's picture

Obviously you've never heard of an animal called a "horse". Or pigeons. Or bonfires...

malek's picture

Read and understand "The Fourth Turning" and you will realize that is not true for generational cycles.

jay35's picture

The other factor is immigration. If they can get a whole new bunch of voters to keep them in power and who can work the low paying jobs and pay taxes, they can keep bouyancy just a bit longer.

Dubaibanker's picture

Correct. Just look at Turkey. After the Americans like Citibank left Turkey.

The Russians and Iranians are moving in. Guess where the profits from Turkey will henceforth go to?

First Russians moved in. http://www.citigroup.com/citi/news/2013/130411a.htm

Now even Iranians are moving in. http://english.farsnews.com/newstext.aspx?nn=13930203001076

With a population of 74m, Turkey is not a small country.

Kuwaitis also bought a European bankhttp://www.bloomberg.com/news/2012-12-23/burgen-bank-concludes-purchase-...

The Qataris are also making a move. http://www.ameinfo.com/blog/banking/qnb-expected-to-acquire-majority-sta...

This is unheard of in the past. It was always Americans or European banks moving into larger countries around the world. Now you hear Chinese or Middle Eastern banks expanding while US and Europeans keep moving backwards back to their home countries and hence all profits which were moving into US or Europe will no longer go there. 

The power and the clout of US and European banks will continue to shrink further over the next decade.

Jack Burton's picture

In the late empire as decline speeded up and disaster stalked Rome, the Romano-British culure in Roman Britain was living in a golden age. Peace and prosperity, great Roman villas were sprouting up in a country side at peace and with growing wealth and culture in both cities and countryside. To a Roman in Britain or a Romano-Celt, the peace of Rome seemed permanent and ever developing, whicle just across the channel, Gaul was being torn apart and raped by Barbarians the legions could or would not stop. It all depends on the spot from where you look out on the world.

I would maintain that Washington DC, capital of a war mongering, bankrupt, greed riven perverted collection of crooks, is a haven of great wealth and power from which the American dream and American empire look set to last a thousand years. But like the Romano-British of late Imperial days, the shit storm is brewing and when it hits, all the villas and cities will decay into the earth and be replaced by crude wooden houses and tiny stone or wood churches hardly big enough to swing a cat. The great treasures will be replaced by crude iron and wooden tools, people will see their lives and culture turn back a thousand years of progress. It has happened before, the USA is ripe for it to repeat.

madtechnician's picture

Hey but the printing presses ran a lot slower in Roman Times , these days they have high speed motorized printing presses , they can print until they run out of trees , then they can start new wars over new tree supplies so they can keep their Ponzi going a lot longer than the romans ever could.

Herodotus's picture

The big money will be made shorting Washington, D.C. real estate.

willwork4food's picture

@ Hero- I would disagree with that. The vestiges of power will concentrate within the black holes until the country outside it disinigrates. Even then, they'll move the paid mercenaries into them to keep them safe for another few decades.

Things that go bump's picture

What happens to all those rich guys when the paid mercenaries decide they'd rather be king then servant?

SAT 800's picture

Then, as in Rome; one of the mercenaries simply takes the throne. And sometimes, they make better leaders than the in-bred professional politicians.