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... in terms of the "stuff getting produced and moved around and used" economy. But I'm reading something along these lines:

  • The pie is getting smaller, because industry is being moved to places where it takes more resources to manufacture stuff than the places it comes from.

  • The developing countries take a part of the hit for the pie getting smaller, by ignoring pollution and other ecological costs that pile up due to the lower efficiency.

  • The Americans are taking the biggest hit, because their industrial plant is going the way of the dodo.

  • The transnats are laying increasing claim to the smaller pie, so right now they're winning.

  • This process cannot continue indefinitely, because when the Americans have lost (or lost claim to) too much of their industrial plant, the only way the transnats could increase their share is by laying claim to Chinese wealth, and the Chinese will oppose this more effectively than the Americans.

So when the music stops,

  • The Americans have lost big time.

  • The Chinese have gained, but due to the costs they're ignoring, they haven't gained nearly as much as they think right now.

  • The transnats who realise that the music will stop can position themselves to gain.

  • The transnats who fail to realise that the music will stop are going to be caught with their pants down, because their business model won't apply any longer

  • The transnats who plan ahead will attempt to capture tangible assets, rather than leave their fortunes in paper money, because when the music stops, the value of paper money will be a matter of political negotiation.

Does that sound about right?

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Jan 12th, 2009 at 06:59:33 AM EST
[ Parent ]
JakeS:
The transnats who plan ahead will attempt to capture tangible assets, rather than leave their fortunes in paper money, because when the music stops, the value of paper money will be a matter of political negotiation.

If the music really stops, then even the ownership of tangible assets will be a matter of political negotiations. As Chris likes to point out, property is a relationship, not an object. It ceases to be yours the moment force is no longer applied on your behalf to maintain exclusive rights. For this reason, if I where the Chinese lending money to the US, I would not be all too comfortable owning physical assets in the US either.
by someone (s0me1smail(a)gmail(d)com) on Mon Jan 12th, 2009 at 11:00:03 AM EST
[ Parent ]
True. But if the music really stops in a way that makes the US seriously reassess property ownership by the transnats, the world is going to be a quite different place. That would take something not too far short of a revolution. Which means that all political relationships - alliances, geostrategy, distribution of wealth, political power, everything - would be up for grabs to some extent or another.

Trying to grasp what the world will look like on the other side of such a fundamental discontinuity is, I think, more in the realm of tea-leaf reading than political analysis.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Jan 12th, 2009 at 03:00:40 PM EST
[ Parent ]
... and modern Russia ... authoritarian strong man governments with local barons behind the scenes putting limits on the reach of the strong man's authority seems to persist through some of the biggest political disruptions imaginable.

Its reasonable to presume that the less dystopian scenarios will involve a rise of regional blocs, since that's what's tended to happen before. It is, after all, not the first time in the world-system that a wave of globalization under the cover of a capitalist hegemony has come to an end, and it seems to be more or less variations on a theme.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Mon Jan 12th, 2009 at 04:07:44 PM EST
[ Parent ]
... but not all the strongmen and barons do. And it seems hard to predict which strongmen and barons will come out ahead. Lots of randomness in revolutions, and it's a lot easier to cut a guy's head off than it is to reattach it...

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Jan 12th, 2009 at 04:12:45 PM EST
[ Parent ]
... there is almost 100% turnover in the incumbents in the roles and even when the role themselves have dramatically different names and supporting folkviews.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.
by BruceMcF (agila61 at netscape dot net) on Mon Jan 12th, 2009 at 04:49:36 PM EST
[ Parent ]
What the Chinese are gaining is not having a political melt-down and chaos. And, of course, a massive industrial machine with a massive resource hunger and a massive destruction of the viability of their own sustainable biocapacity.

They are in a race, and whether they end up as winners in some sense depends on how effectively they manage the demographic transition. However, they are doing just about everything they can do, with all of the choices facing them involving hard trade-offs and genuine uncertainty how much bad to accept for how much good on either side of the choice ...

... and, sure, it could all come unraveled.

However, they might keep on juggling plates without too many crashing down and without falling off the high wire that they are driving their unicycle across. Its not a static question of where they have arrived, its a dynamic question of whether they can keep the plates on the air and the unicycle wheel on the wire.

There is, however, a possible viable future, with their current demographic track meaning a falling population level by the next generation, and their real economy at least gaining the ability to make things that countries with the resources they need may be interested in having.

For transnationals looking to maintain and buid on their present position of strength, it does depend on how effectively they acquire effective military force, doesn't it? Because when it comes down to it, when there is a dispute over property titles across large number of borders, the ability to move a squad of soldiers into the property and boot out the interlopers, from the perspective of that side of the negotiating table, is the strong hand when it comes to property rights.

This is, of course, another reason for those of us with a commitment to liberal democracy to invest in resilient local economies in sub-Saharan Africa. The big transitional World Wars tend to get started in a region of soft states on the periphery of the main actors ... Italy in the Napoleonic World War, the Balkans in WWI, eastern Europe and Southeast Asia in WWII (the long cycle people have more examples, those are the ones that come to mind). The EU already has multiple stakeholdings in Sub-Saharan Africa, the US is heavily dependent on Africa oil, and the Chinese, of course, are busily building up their influence, swapping manufactured goods on easy credit terms for access to raw materials.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Mon Jan 12th, 2009 at 01:18:46 PM EST
[ Parent ]
For transnationals looking to maintain and build on their present position of strength, it does depend on how effectively they acquire effective military force, doesn't it?

East India Company, meet Weyland-Yutani... You do have a talent for thinking up decidedly unpleasant scenarios...

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Jan 12th, 2009 at 03:09:04 PM EST
[ Parent ]
... but the East India Company ended up handing military power over to the Raj ... I'm not 100% sure how stable that kind of corporate feudalism really is, and in particular how it gains political legitimacy amongst the governed.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.
by BruceMcF (agila61 at netscape dot net) on Mon Jan 12th, 2009 at 04:03:11 PM EST
[ Parent ]
You do have a talent for thinking up decidedly unpleasant scenarios...
- Jake
Make that "an informed talent"

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Jan 13th, 2009 at 03:45:52 PM EST
[ Parent ]

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