Washington’s declining fiscal responsibility was not resolved after the Great Financial Crisis of 2008-09 as the US instead kicked the can down the road.
As the world slowly becomes more dependent on the "new house" BRICS, it'd be nice to see more on its architecture. Especially in respect of the unavoidable absence of a central banking system, and the arguably parallel problem of how to avoid reliance on cryptocurrencies. :)
All the political incentives align on the side of kicking the can down the road. It might work or it might not, and the probability of it working might be very slim but if "we" (the Fed, Congress, the Administration) don't kick the can down the road, catastrophe and associated ignominy is 100% certain.
Rolling the dice is the percentage play when perverse incentives dominate.
I am liking the article. Not sure how this mistake was made but this line: 'However, this solution would have required the US to give up on its objective to preserve global privacy." I think privacy should be primacy.
USA will decline a bit slower than expected. After all, USA is still one country, for now. BRICS is at most a trading organization of multiple countries with each of its five founders with largerthan-life national ego. BRICS has not yet shown its capacities anywhere close to WTO. The largest and best value of BRICS right now is to promote non-USD trades, while USA has no choice but to devalue the USD. As for expecting a new international order out of BRICS, that is hoping too far and too fast. IMHO, BRICS is already expanding too fast for its own good.
The WTO has been very bad for economic development, social advancement, and scientific advancement. The USA did not become a true single unified market until it leapt towards one between the latter 1970s and mid 1980s, things like real GDP growth rates began to decline almost immediately, I assure you that there are very strong cases to be made that its has been very bad for the USA from an economic, social, and scientific standpoint. China is now going to turn its economy into a full on single market if the results of the 3rd Plenum are implemented, even though its been doing great for the past four decades, and their making the same arguments that American were told in the 1970s to justify doing it here, those arguments failed even in their own oversimplified terms. If China does go through with it, hopefully things work out better for them than it did for us.
the USA did not just have federalism politically, it also had, part and parcel with that, federalism in its economic and scientific/engineering spheres. It was at once, and I really do want emphasize that it was at the same time, deeply economically and scientifically integrated WHILE ALSO being deliberately economically and scientifically semi-fragmented.
The current guardian of our current paradigm is capital "G" Globalism both through its empowerment of the constellation of special interest groups that dominate our political economy and also, the core of its architecture, the global financial system and the USD as the world's reserve currency, are the half of the the force that "financialized" our economy. Some may say that this means there can be no return to federalism. But that may not be true because what we have is a planetary empire which may constructed from several co-dependent parts and domestic continental empire that has true external dependencies on the global one. And the USA's political economy is that is still very complicated, its just that it is a latent complexity because there exists an equilibrium in the political economy across not just the large special interests groups, but also a great many out of sight and out of mind smaller ones spread across our social and economic landscape. And they are all doing either well or well enough. But if capital "G" Globalism either falls or at east erodes by a large degree, and then the federal government can no longer do its magic three of large and perpetual budget deficits, large and perpetual trade deficits**, and low interest rates; all with high goods availability and very little inflation, well, if that money dries up, I suspect so will that equilibrium and we'll see that latent complexity activated very quickly and both sectoral and geographic interests expressing themselves politically in way they haven't in several decades, possibly in some cases in ways they haven't since the 1930s, and then we'll have some not insignificant amount of decentralization in at least some of the key economic spheres
Yes. All States have some noticeable differences. To define a rule good for California can be very bad for North Dakota. Hence the original spirit of the Constitution is minimal, rather than maximal federalism, if I even use that term correctly. It was meant to be a union of states, rather than 50+ provinces under a central government. Many Chinese dissidents have argued exactly the same thing that the future model of China should be a union of States. At least, there have to be room for local variation due to different needs. But with Provincial leaders dispatched from Beijing, it will be hard to allow local differences. At least, there is a counter-argument of 2000 years of tradition. Alternatively, think about the situation when all states governors are political assignment by the POTUS, then what would happen. Ditto for EU. Had they remained a cooperation council, things would have been better now.
But it can be slowly then all at once and the at once can be a surprise to those living through it because the slowly part was happening far longer than they thought because they picked up on it late.
Regarding the USA, what we have is a planetary empire which may constructed from several co-dependent parts and domestic continental empire that has true external dependencies on the global one. And the USA's political economy is that is still very complicated, its just that it is a latent complexity because there exists an equilibrium in the political economy across not just the large special interests groups, but also a great many out of sight and out of mind smaller ones spread across our social and economic landscape. And they are all doing either well or well enough. But if capital "G" Globalism either falls or at east erodes by a large degree, and then the federal government can no longer do its magic three of large and perpetual budget deficits, large and perpetual trade deficits**, and low interest rates; all with high goods availability and very little inflation, well, if that money dries up, I suspect so will that equilibrium and we'll see that latent complexity activated very quickly and both sectoral and geographic interests expressing themselves politically in way they haven't in several decades, possibly in some cases in ways they haven't since the 1930s, and then we'll have some not insignificant amount of decentralization in at least some of the key economic spheres
The USA is also proof of your first paragraph, a bunch of people seeing its decline but most in denial because the "USA is the best!" There's that saying that empires live, on average, 250 years, but that's misnomer 'cause the average of a 1000yr and a 100yr empires is 500. The USA is more New Babylon than Rome.
My hesitancy is because I don't want my hope to be treated as fact. Yes, a great recession could crash the dollar, and an in-fighting USA could become more isolationist. Opposingly, the dollars crash would send the world into a tailspin too. My country of South Africa would likely spiral into violence. Who would band together in this nightmare world? Surely a lot of the same people as before, 'cause when shit hits the fan, people are tribal. Would an America with 400 military bases instead of 800 be dead or half an empire.
I don't know. I'm not an optimist, so its more a battle for me to be a realist.
I just heard that Russia was trying to bribe Moldova's citizens to vote for the Russian supported candidate in this year presidential elections. I agree that a multipolar world is more desirable.
Well written and interesting. But there may indeed actually be a simple solution to the *headline* problems that you listed. For example, you noted the "financialization" of the economy as a key driver of our structural issues and I believe that to be correct. Well, step one could be undoing what was done to generate that, the USA, for every single day of its existence until they were mostly done away with between the latter 1970s and mid 1980s and then fully done away with around the year 2000, had internal capital flow inhibitors, multiple classes of banks in relation to geographic and sectoral capital allocation, and other structures that intentionally created a system of semi-fragmented capita markets that enabled national level capital formation while also guaranteeing both a geographic and decision making diffusion of control over capital. This system, after having existed for ~200 years was done away simply through legal changes, but what was done can be undone.
That was one of the structure sets of America's Enlightenment inspired federalism, see, the USA did not just have federalism politically, it also had, part and parcel with that, federalism in its economic and scientific/engineering spheres. It was at once, and I really do want emphasize that it was at the same time, deeply economically and scientifically integrated WHILE ALSO being deliberately economically and scientifically semi-fragmented.
The current guardian of our current paradigm is capital "G" Globalism both through its empowermet of the constellation of special interest groups that dominate our political economy and also, the core of its architecture, the global financial system and the USD as the world's reserve currency, are the half of the the force that "financialized" our economy. Some may say that this means there can be no return to federalism. But that may not be true because what we have is a planetary empire which may constructed from several co-dependent parts and domestic continental empire that has true external dependencies on the global one. And the USA's political economy is that is still very complicated, its just that it is a latent complexity because there exists an equilibrium in the political economy across not just the large special interests groups, but also a great many out of sight and out of mind smaller ones spread across our social and economic landscape. And they are all doing either well or well enough. But if capital "G" Globalism either falls or at east erodes by a large degree, and then the federal government can no longer do its magic three of large and perpetual budget deficits, large and perpetual trade deficits**, and low interest rates; all with high goods availability and very little inflation, well, if that money dries up, I suspect so will that equilibrium and we'll see that latent complexity activated very quickly and both sectoral and geographic interests expressing themselves politically in way they haven't in several decades, possibly in some cases in ways they haven't since the 1930s, and then we'll have some not insignificant amount of decentralization in at least some of the key economic spheres
Excellent analysis.
As the world slowly becomes more dependent on the "new house" BRICS, it'd be nice to see more on its architecture. Especially in respect of the unavoidable absence of a central banking system, and the arguably parallel problem of how to avoid reliance on cryptocurrencies. :)
The obvious solution for Gringolandia to get out of this mess? To set the Rest of the World on fire. Proven results!
Will it work in the long term? No.
Will it cause untold suffering? Sure.
Seems like Zombies-Europe is remotely controlled by the bullies in USA. There are no other explanations.
Good high level overview.
Surely this is a typo? “The US is not unlikely to make the necessary changes……”
And. "...global privacy."
It should be "Global Primacy" think just a typo.
I thought The same.. Besides that amazing wide perspective analysis.
All the political incentives align on the side of kicking the can down the road. It might work or it might not, and the probability of it working might be very slim but if "we" (the Fed, Congress, the Administration) don't kick the can down the road, catastrophe and associated ignominy is 100% certain.
Rolling the dice is the percentage play when perverse incentives dominate.
Ukraine and isra hell destroyed scAmerica
Those are but the symptoms of a greater problem. Ignorance, arrogance and hubris.
how the EU still does not realize this change? but they re losing the elections over this....
I think our top leaders are controlled. Many people in society see this. For example swedes had NO choice in joining NATO.
I am liking the article. Not sure how this mistake was made but this line: 'However, this solution would have required the US to give up on its objective to preserve global privacy." I think privacy should be primacy.
There is another similar instance let me find it.
USA will decline a bit slower than expected. After all, USA is still one country, for now. BRICS is at most a trading organization of multiple countries with each of its five founders with largerthan-life national ego. BRICS has not yet shown its capacities anywhere close to WTO. The largest and best value of BRICS right now is to promote non-USD trades, while USA has no choice but to devalue the USD. As for expecting a new international order out of BRICS, that is hoping too far and too fast. IMHO, BRICS is already expanding too fast for its own good.
The WTO has been very bad for economic development, social advancement, and scientific advancement. The USA did not become a true single unified market until it leapt towards one between the latter 1970s and mid 1980s, things like real GDP growth rates began to decline almost immediately, I assure you that there are very strong cases to be made that its has been very bad for the USA from an economic, social, and scientific standpoint. China is now going to turn its economy into a full on single market if the results of the 3rd Plenum are implemented, even though its been doing great for the past four decades, and their making the same arguments that American were told in the 1970s to justify doing it here, those arguments failed even in their own oversimplified terms. If China does go through with it, hopefully things work out better for them than it did for us.
the USA did not just have federalism politically, it also had, part and parcel with that, federalism in its economic and scientific/engineering spheres. It was at once, and I really do want emphasize that it was at the same time, deeply economically and scientifically integrated WHILE ALSO being deliberately economically and scientifically semi-fragmented.
The current guardian of our current paradigm is capital "G" Globalism both through its empowerment of the constellation of special interest groups that dominate our political economy and also, the core of its architecture, the global financial system and the USD as the world's reserve currency, are the half of the the force that "financialized" our economy. Some may say that this means there can be no return to federalism. But that may not be true because what we have is a planetary empire which may constructed from several co-dependent parts and domestic continental empire that has true external dependencies on the global one. And the USA's political economy is that is still very complicated, its just that it is a latent complexity because there exists an equilibrium in the political economy across not just the large special interests groups, but also a great many out of sight and out of mind smaller ones spread across our social and economic landscape. And they are all doing either well or well enough. But if capital "G" Globalism either falls or at east erodes by a large degree, and then the federal government can no longer do its magic three of large and perpetual budget deficits, large and perpetual trade deficits**, and low interest rates; all with high goods availability and very little inflation, well, if that money dries up, I suspect so will that equilibrium and we'll see that latent complexity activated very quickly and both sectoral and geographic interests expressing themselves politically in way they haven't in several decades, possibly in some cases in ways they haven't since the 1930s, and then we'll have some not insignificant amount of decentralization in at least some of the key economic spheres
Yes. All States have some noticeable differences. To define a rule good for California can be very bad for North Dakota. Hence the original spirit of the Constitution is minimal, rather than maximal federalism, if I even use that term correctly. It was meant to be a union of states, rather than 50+ provinces under a central government. Many Chinese dissidents have argued exactly the same thing that the future model of China should be a union of States. At least, there have to be room for local variation due to different needs. But with Provincial leaders dispatched from Beijing, it will be hard to allow local differences. At least, there is a counter-argument of 2000 years of tradition. Alternatively, think about the situation when all states governors are political assignment by the POTUS, then what would happen. Ditto for EU. Had they remained a cooperation council, things would have been better now.
Empires always fall, but they fall slowly.
But it can be slowly then all at once and the at once can be a surprise to those living through it because the slowly part was happening far longer than they thought because they picked up on it late.
Regarding the USA, what we have is a planetary empire which may constructed from several co-dependent parts and domestic continental empire that has true external dependencies on the global one. And the USA's political economy is that is still very complicated, its just that it is a latent complexity because there exists an equilibrium in the political economy across not just the large special interests groups, but also a great many out of sight and out of mind smaller ones spread across our social and economic landscape. And they are all doing either well or well enough. But if capital "G" Globalism either falls or at east erodes by a large degree, and then the federal government can no longer do its magic three of large and perpetual budget deficits, large and perpetual trade deficits**, and low interest rates; all with high goods availability and very little inflation, well, if that money dries up, I suspect so will that equilibrium and we'll see that latent complexity activated very quickly and both sectoral and geographic interests expressing themselves politically in way they haven't in several decades, possibly in some cases in ways they haven't since the 1930s, and then we'll have some not insignificant amount of decentralization in at least some of the key economic spheres
The USA is also proof of your first paragraph, a bunch of people seeing its decline but most in denial because the "USA is the best!" There's that saying that empires live, on average, 250 years, but that's misnomer 'cause the average of a 1000yr and a 100yr empires is 500. The USA is more New Babylon than Rome.
My hesitancy is because I don't want my hope to be treated as fact. Yes, a great recession could crash the dollar, and an in-fighting USA could become more isolationist. Opposingly, the dollars crash would send the world into a tailspin too. My country of South Africa would likely spiral into violence. Who would band together in this nightmare world? Surely a lot of the same people as before, 'cause when shit hits the fan, people are tribal. Would an America with 400 military bases instead of 800 be dead or half an empire.
I don't know. I'm not an optimist, so its more a battle for me to be a realist.
Don’t underestimate the USA
What happened to your YouTube channel? If there is anything we can do to help get it reinstated, please let us know.
I just heard that Russia was trying to bribe Moldova's citizens to vote for the Russian supported candidate in this year presidential elections. I agree that a multipolar world is more desirable.
The poluticians will make America First look like a victory probably. Realism is not the way against China.
Well written and interesting. But there may indeed actually be a simple solution to the *headline* problems that you listed. For example, you noted the "financialization" of the economy as a key driver of our structural issues and I believe that to be correct. Well, step one could be undoing what was done to generate that, the USA, for every single day of its existence until they were mostly done away with between the latter 1970s and mid 1980s and then fully done away with around the year 2000, had internal capital flow inhibitors, multiple classes of banks in relation to geographic and sectoral capital allocation, and other structures that intentionally created a system of semi-fragmented capita markets that enabled national level capital formation while also guaranteeing both a geographic and decision making diffusion of control over capital. This system, after having existed for ~200 years was done away simply through legal changes, but what was done can be undone.
That was one of the structure sets of America's Enlightenment inspired federalism, see, the USA did not just have federalism politically, it also had, part and parcel with that, federalism in its economic and scientific/engineering spheres. It was at once, and I really do want emphasize that it was at the same time, deeply economically and scientifically integrated WHILE ALSO being deliberately economically and scientifically semi-fragmented.
The current guardian of our current paradigm is capital "G" Globalism both through its empowermet of the constellation of special interest groups that dominate our political economy and also, the core of its architecture, the global financial system and the USD as the world's reserve currency, are the half of the the force that "financialized" our economy. Some may say that this means there can be no return to federalism. But that may not be true because what we have is a planetary empire which may constructed from several co-dependent parts and domestic continental empire that has true external dependencies on the global one. And the USA's political economy is that is still very complicated, its just that it is a latent complexity because there exists an equilibrium in the political economy across not just the large special interests groups, but also a great many out of sight and out of mind smaller ones spread across our social and economic landscape. And they are all doing either well or well enough. But if capital "G" Globalism either falls or at east erodes by a large degree, and then the federal government can no longer do its magic three of large and perpetual budget deficits, large and perpetual trade deficits**, and low interest rates; all with high goods availability and very little inflation, well, if that money dries up, I suspect so will that equilibrium and we'll see that latent complexity activated very quickly and both sectoral and geographic interests expressing themselves politically in way they haven't in several decades, possibly in some cases in ways they haven't since the 1930s, and then we'll have some not insignificant amount of decentralization in at least some of the key economic spheres
Once the hot pockets run out, it's gonna be a shitshow.