Ian Welsh

The horizon is not so far as we can see, but as far as we can imagine

Author: Ian Welsh Page 4 of 390

Seven Days Till The US Federal Election

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On October 29, 2024

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And Trump is very slightly ahead in the polls.

As is usually the case in modern American elections, much that is important isn’t at stake in this election: most notably whether or not the genocide in Palestine will continue. Both candidates and both parties are under the thumb of the Israeli lobby. Nor is an end to the terminal decline of the American Empire on the ballot, though Trump pretends it is.

That isn’t to say the election doesn’t matter, but it’s a choice between two terrible candidates. Trump is clearly senile and mercurial is the kindest word one can use to describe him. Harris is not that bright, and appears to fall into the Bush Jr. category: something happened to damage her. Plenty of rumors of alcohol problems, though I don’t know if they’re valid.

Both candidates are moral and ethical monsters, whose ambition and vanity are such that they would kill or impoverish any number of people to achieve their personal goals. (No, don’t even. This isn’t in question.)

I can’t be bothered to endorse either of them. This is a case of “would you prefer Satan or Beelzebub?” Unless you’re in a swing state I’d strongly urge you to vote third party or spoil your ballot. Even in a swing state you should seriously consider it.

About sixty percent of Americans think that the two-party system is broken, but they won’t vote for a third party because they think it’s a wasted vote, and this collective action problem makes continued decline inevitable.

(This blog is for understanding the present, making educated guesses at the future, and telling truths, usually unpleasant ones. There aren’t a lot of places like this left on the Web. Every year I fundraise to keep it going. If you’d like to help, and can afford to, please Subscribe or Donate.)

Domestically it’s clear that Harris, who says she wouldn’t have done a single thing differently than Biden, is the candidate of status quo decline. Things will keep getting worse in about the same way. Trump will shake things up, primarily because of who he will appoint to government and their plans of taking over the bureaucracy.

Democrats aren’t serious about abortion rights, but Trump will make the situation even worse. His economic policies will be disastrous in different ways than Harris’s: tariffs aren’t a bad idea, but without industrial policy and policies designed to end rent-seeking and funnel resources into industry they won’t don’t do much but cause different types of pain. His appointments to the supreme court will be awful, though that ship has sailed and until Democrats are willing to court pack it seems unlikely there will be any near-term change.

This election was Harris’s to win, but she didn’t want it enough to distance herself strategically from Biden. It wouldn’t have taken much, I’d bet that just some serious talk about taming the inflation which ordinary people feel but economists insist doesn’t exist would have done it. Or she could have come out against genocide, and courted the left instead of the right by campaigning with Liz Cheney, et al.

But at the end of the day, people like Harris would rather the right win than do anything seriously left-wing like “not mass murder”, which is now so far from the central axis of American politics that it amounts to extremism, and is treated by universities, the political class and the justice system as the hand maiden to terrorism.

In such a decaying Empire, the truth is there are few good, viable, choices left. Pick your arch-demon or vote for someone who at least isn’t into mass murder but won’t win.

Middle East War: The Israeli Ground Forces Still Can’t Deliver

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On October 28, 2024

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Israel has three great assets:

  • Its air force;
  • Its spies;
  • America.

What it doesn’t have is a good army:

After nearly five weeks of intense fighting, Israeli soldiers have managed to enter several border villages, advancing a maximum of just under two kilometres in some areas. However, they have been unable to establish overnight positions. These forces have resorted to widespread destruction, levelling homes and mosques along the border to create “scorched earth” zones. This tactic, however, exposes Israeli tanks, making them vulnerable and preventing adequate concealment as they cautiously advance through Lebanese villages. Consequently, Israeli casualties have surged

Or, to put it another way, Netanyahu’s mouth has written checks that Israel’s ground forces can’t cash. So Israel is back to wanton destruction, mostly by air.

I’ve said for years that Hezbollah’s army is one of the best in the world, man for man, and so far it seems that judgment is vindicated.

Israeli forces are currently only engaging Hezbollah’s “spoiling attacks” within the “engagement area”. They are yet to penetrate the “main battle area,” where Hezbollah’s primary defences and “striking forces” are positioned. Hezbollah’s strategy integrates conventional and guerrilla warfare tactics, employing adaptable defences above and below ground. It focuses on attrition strategy, using mobile defence tactics to harass and weaken enemy forces before drawing them into decisive engagements. These tactics include tactical retreats that expose enemy flanks, allowing Hezbollah to strike at Israel’s advancing spearhead, systematically disrupting momentum and inflicting heavy losses.

Meanwhile Israel’s attack on Iran does not appear to have done great damage and Hamas ordered Northern Israeli villages being used as invastion staging points to evacuate, and has started hitting them with missiles and drones, leading to another couple hundred thousand Israeli internal refugees.

(This blog is for understanding the present, making educated guesses at the future, and telling truths, usually unpleasant ones. There aren’t a lot of places like this left on the Web. Every year I fundraise to keep it going. If you’d like to help, and can afford to, please Subscribe or Donate.)

But the weak suffer what they must, and Northern Gaza has spent October under complete embargo of food and water. The Israeli genocide of Palestinians continues, and the clear intention is to occupy North Gaza permanently once its residents are displaced or dead.

Indeed the Israeli way of war is now clearly “genocide uber alles” with Israel’s air attacks in Lebanon prioritizing civilian buildings, with multiple attacks on hospitals, at least one attack on an orphanage and repeated warnings that they will strike first responders who try to save lives.

Israel is attempting to break the will of civilian populations through terror. Israel’s war doctrine is mass terror, ethnic cleansing and genocide, with attacks meant to maximize civilian casualties both during and after the attack. The fewer hospitals, doctors and so on, the more people who will die or be permanently maimed.

This is a war of the cowardly against civilians, which makes sense: Israel’s occupation has left its military specialized in brutalizing civilians. It had great difficulty against Hamas, a rag tag militia with missiles and other weapons built in basements. Against Hezbollah’s ground forces: seasoned, well equipped and dug in, it has been unimpressive.

The problem for Israel is simple enough: terror from the air doesn’t win wars and doesn’t break moral. Instead it makes people more determined to resist, not less.

If Israel, after its assassinations and attacks on warehouses had declared victory, it would still look strong. But engaging with Hezbollah on the ground has proven a serious mistake.

Israel is a great example of “those who are abused become abusers.” Israel might as well be Nazi Germany when it comes to both ideology (national ethnic supremacy) and actions: genocide of a despised ethnic/religious group.

It is a sad thing to see, both for their victims and for themselves. They have become monsters, and with polls indicating over 90% support for the way the war is fought, it’s clear that this has infected the mass of the Israeli citizenry.

When Israel is finally defeated, likely in a future war, it will need to completely de-Zionised, in a way Germany was never properly de-Nazified.

This entire war is sad and stupid and based on the fundamental injustice of taking other people’s land and homes. It is pursued thru terror, mass murder, genocide and ethnic cleansing and war crimes are so routine they happen every day as a matter of policy.

Every nation who supports Israel in this is stained by Israel’s crimes. We all know genocide is happening, and our countries have supported it, made it possible and opposed all efforts to end it.

To riff on Jefferson, we had best hope that there is no just God.

Quick Takes: US Naval Decline, ASML’s Fall & More

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On October 25, 2024

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Some topics deserve a mention but not a full article and that’s what quick takes are for.

***

This blog is for understanding the present, making educated guesses at the future, and telling truths, usually unpleasant ones. There aren’t a lot of places like this left on the Web. Every year I fundraise to keep it going. If you’d like to help, and can afford to, please Subscribe or Donate.

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I’ve written about US ship building problems before, but it’s not just about that, the Navy is retiring ships faster than they are being built. (And yes, China is building them way faster than it is retiring them.)

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Seems that the extra surveillance for the Paris Olympics will become permanent. Surveillance state, HO!

Offered without comment:

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There’s a meme going around that when Norway increased taxes on the rich it lost tax income because so many rich people fled. Turns out that was not the case.

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Add to, “what a mystery!” and “Who would have expected!”

The analysis revealed that the mortality rate of Americans ages 1 to 19 rose by 11% between 2019 and 2020 and an additional 8% between 2020 and 2021.

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The new BYD Seagull EV costs $9,700 American, though that price is only really available to Chinese, they kick it up a lot even for countries without tariffs.

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ASML, which creates advanced lithography machines, has 49% of its sales in China. Due to sanctions, it expects that number to drop to 20% of sales. Share prices crashed 16% in a single day.

ASML’s CEO previously indicated he expect China to learn how to make lithography machines and that ASML and the West would eventually lose essentially the entire market. What he didn’t say is that once China can make these machines, they’ll then take the entire non-Western market too. Truly sanctions stupidity.

Austerity, Demand and Reindustrialization

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On October 24, 2024

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This blog is for understanding the present, making educated guesses at the future, and telling truths, usually unpleasant ones. There aren’t a lot of places like this left on the Web. Every year I fundraise to keep it going. If you’d like to help, and can afford to, please Subscribe or Donate.

So, it’s clear from the response to my last post that some readers aren’t familiar with the effects of austerity on balance of payments and vice-versa. Balance of payments is, oversimplified, how much money is going in and out of a country.

When money goes into a domestic economy, if it is used to buy something that is imported, that effects balance of payments negatively.

If you’re selling more than you buy, which can mean services as well as good, then that helps balance of payments. It also includes financial games: so if people are sending money to the London financial center, well, that improves BoP. London’s the world’s second largest financial center, after New York.

Now here’s the thing. Britain doesn’t grow enough food to feed its population. It doesn’t have a lot of industry left. North Sea oil is depleting, to the point that Britain became a net importer of oil in 2013. (Take a look at that chart.)

When the government spends money it isn’t magically siloed from causing import demand. The government cut back on heating subsidies, for example, and limited child support payments to two children. Without that money, oil and other demand is not as high as it would be otherwise.

Indeed, nothing is really siloed. If the government spends, almost always some of that money is going to go overseas and spike imports.

Britain controls its own printing press. It can print as many pounds as it wants, but it can’t make people in other countries take the money. The more they print, the less the pound will be worth, and the more inflation there will be because the dropping pound will increase prices of imported goods.

The pound is not the world trading currency any more. It hasn’t been since WWII. It can’t print pounds the way the US can print dollars and expect everyone to just take them.

Austerity is, in many ways, cruel and stupid, but if Britain (or Canada, or Australia, or even Europe) is to print money without it causing serious economic issues and to actually reindustrialize, it has to be done intelligently, along with serious industrial and domestic economic policy. (Currently tons is printed, but siloed to the rich, which keeps general demand from exploding but destroys markets’ ability to function properly.)

Now the thing is that Britain is a high cost of living economy: food and housing are expensive. Very expensive. Workers need to be paid well to survive, and that makes Britain un-competitive against lower cost (or higher productivity) countries.

If you wanted to make Britain competitive again, you’d have to crash housing and rent, to start. You can imagine how politically fraught that is: people who have high net worth due to real estate aren’t going to like it.

Then there’s the issue of the City, the financial center. Financial center profits are HIGH. That’s a problem, because people would rather put money into finance than into industry or farming or whatever since returns are better. Finance cannibalizes the rest of the economy. So you have to weaken the city and silo it, and probably tax it a lot. That’s hard to do, because the City has a lot of power, and there’s a real issue because it does, actually, bring a lot of money in to Britain, it’s just that money doesn’t get spread around.

When you industrialize, or re-industrialize, you have to make sure that money in the domestic market buys domestic goods, doesn’t buy a lot of foreign goods, and is used primarily on industrialization: capital goods, primarily. It’s unpleasant, it means a lot of goods (imported goods) aren’t available or are very expensive. Your new industry, ideally, either serves the domestic market, or is good for export, or both.

Austerity doesn’t exist just because governments are run by stupid psychopaths (though that’s part of it), it exists because of very real constraints caused by a need to send more money out of the country than is coming in to the country. In the seventies the UK was in so much trouble it had to actually go to the IMF for help, and join the EU so Europe would help it bail out.

Now, again, there are ways around this, but they require taking on powerful interests and hurting a big chunk of the population, especially in the short to medium term (about twenty years or so.) It means, as much as possible, making do with what you can produce yourself, and when you can’t, going cheap. No foreign fresh fruit imports, except the cheapest (hope you like bananas.) Cheap phones and appliances. Etc…

It also means ending all sorts of stupid financial games: no more Private Equity. No stock buybacks. No huge stock option grants. You want money reinvested. Currency controls so money doesn’t flood out. Possibly a dual currency.

All of this is painful. But if you don’t do it, decline inevitably continues and eventually you’re back to being a third world country.

Austerity is a pressure bandage on a wound that still won’t stop bleeding. It slows down the decline, but it doesn’t heal the wound.

Update: Just for kicks, here’s Germany’s BOP:

And China:

The End of Austerity & Reindustrialization

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On October 23, 2024

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Austerity Is Mostly Stupid… Mostly.

This blog is for understanding the present, making educated guesses at the future, and telling truths, usually unpleasant ones. There aren’t a lot of places like this left on the Web. Every year I fundraise to keep it going. If you’d like to help, and can afford to, please Subscribe or Donate.

But there is some logic to it, especially in places like Britain. The fundamental problem is de-industrialization. You can print as much money as you want, sure, but if almost everything you need is made or grown or dug somewhere else well, you have a problem. The US avoids this thru having dollar hegemony, for now, but the UK doesn’t have that and the Euro ain’t what it used to be either. The solution is simple in concept: you need to re-industrialize with than printed money.

(This is a theme and topic we’ve covered before, but forgive me running thru it again from another angle.)

Industrializing or reindustrializing is hard, especially with open markets. You need very careful use of tariffs and subsidies, and you need to cut deals with the current hegemonic industrial power: aka. China. You need real industrial policy, in other words. And neoliberalism doesn’t believe in that.

Instead neoliberalism believes in this weird idea that markets are self-correcting and that whatever markets do is right. Nor does it believe in increasing wages for domestic demand, because it came to power during the oil shocks/stagflation period.

Raising wages and thus general domestic demand when you don’t produce enough domestically means money flooding out of the country. This isn’t necessarily bad. A lower pound or Euro is an export subsidy and helps reindustrialize, but it’s still a hard sell and it has to managed.

You can’t let the trade and balance of payments deficit grow too large. And you have to manage domestic demand: pushing people to buy what is produced locally and making imports for consumer goods expenisve, while funneling import buys towards capital equipment.

This playbook has been run many times. Japan, South Korea, Taiwan, the US in the 19th century, China most recently. We know how to do it. But it does require discipline and an ideological change from neoliberalism, plus a willingness to cooperate with the main industrial power

It’s damn near impossible to industrialize or re-industrialize without aid from the current industrial hegemon. That means getting into a trade war with China is counter-productive. You need to import capital goods from them, and sell them what you produce at competitive prices.

Japan and the USA had Britain. Japan (2nd time), South Korea, China and Taiwan had the United States. You need the markets, knowledge and capital goods.

This mean, in effect, that you need to cut a deal with the current industrial power. They don’t precisely have to be good deals (China offered to make American rich people richer), but the deal has to be something they want.

For US/China one obvious deal is to let them get goods like EVs into the US without tariffs if they build branch plants and help create a supply network in the US. Another obvious deal is to stop supporting Taiwan so much & another is to let them have the South China sea. The EU and Britain can make the same deals.

If the last two bother you, well, look at it this way: they’re going to get Taiwan and the South China Sea anyway, you’re just making it easier for them. You’re giving up things you’re going to have to give up anyway.

This requires a psychological change among Western elites. They need to be willing to admit that they are no longer the top dogs, at least economically and that they can no longer just impose the terms they want.

The longer you leave cutting deals with China to help you reindustrialize, the worse deals you’re going to get. Leave it too long, and reindustrialization may be essentially impossible.

Of course there’s much more to it than this. A complete rejiggering of internal markets is necessary. You have to gut finance and put it at the service of industry. Private equity has to be destroyed wholesale. People can only get rich by exporting or making goods for the domestic market which replace imported goods. Anyone doing significant import of anything but capital machinery (with an eye to building your own) can only be allowed to survive, not prosper.

Generally speaking, to use econo-speak, incentives have to be aligned for re-industrialization, and dis-aligned for anything predatory. Betraying elites must be crushed.

There is no solution to declining standards of living in the Anglosphere and the EU without re-industrialization (maybe Canada and Australia could find another way.) You’ve got to either produce what you need, or produce what others want to buy from you. It’s that simple.

 

2024 Fundraising Update

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On October 21, 2024

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We’ve raised something over $5,400 since the fundraiser started, meaning we’ve reached the first goal of $4K and our $2,500 out from $7,000 tier, at which point I’ll do 3 reviews of important books. At 10K, which is $4,600 out, I’ll write an article on:

…the fundamental process which keeps society together, how it fails and renews and under what conditions it fails to renew.

And at $13,000, I’ll write:

an article on the weaknesses of North American style police, and how a determined and ruthless opponent could take advantage of those weaknesses to rip them a new one.

I really appreciate everyone who’s given. Donations and subscriptions from readers which have kept this blog alive and running. Times are hard, since Covid each fundraiser has become more difficult, because people are hurting, in particular from inflation.

I think this is a place where we tell the truth as we know it and where we try to make educated guesses about what the future holds. Every year it seems there are fewer places like this left.

If you’re in trouble financially, if food or shelter or medicine is an issue, please don’t give.

But if you can afford it, and you like my writing, I’d appreciate it if you did.

SUBSCRIBE OR DONATE TO OUR 2024 FUNDRAISER

Open Thread

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On October 19, 2024

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Use to discuss topics unrelated to recent posts.

Europe Is Turning Anti-Immigrant

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On October 18, 2024

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Politico has a long article on it, and it’s hilarious. A border wall longer than Trump and Biden’s. “Return centers” in other countries, because they’re too gutless to say deportation, and so on. Complaining about Russia and Belarus’s immigration warfare (letting refugees thru Russia to get to Europe. Including, er, Afghan refugees.)

Let’s cut thru the bullshit.

The EU is in economic decline and can no longer afford refugees they can’t monetize.

Europe is also responsible for much of the refugee crisis, having enabled the destruction of Afghanistan and Iraq (Poland, one biggest criers, was part of the “coalition of the willing.”) Europe, with some honorable exceptions like Ireland and Spain, is behind the Israelis, who are about to institute a flood of Lebanese refugees. Europe, thru the world bank, IMF and various post-colonial policies has worked hard to keep third world nations in poverty, increasing refugee flows.

They have helped destroy or impoverish entire nations, then whine about how migrants come to them begging for safety or a decent life.

In humanitarian terms, and international law terms, what the EU is doing is wrong, but the simple truth is that they can’t afford immigration any more, and that mass immigration has exacerbated the right wing turn. Not that it had to, but if you have large numbers of immigrants into a bad economy, who are competing for jobs and housing and social welfare with the desperate, they will naturally blame the immigrants instead of purging the incompetent and corrupt elites who are managing the economy with eye only to benefit themselves.

(I’m running my annual fundraiser. If you value my writing and want more of it, please consider donating. Your donations really do keep this place running.)

The Ukraine war has made this particularly bad, not just because of all the Ukrainian migrants, but because it has increased the de-industrialization of Europe’s industrial heart, Germany.

This is, again, a self-inflicted wound. If Europe had kept the Minsk accords, or, more long term, treated Russia and its security concerns seriously, there wouldn’t have been a war. If Europe did not insist on being subordinate to America, none of this would have happened.

But Euro elites can’t imagine taking actual responsibility for their own countries and telling the US to bugger off, then following something other than neoliberal politics and economic policies.

Reducing immigration makes some sense, even if it’s inhumane, but it’s very much a “treat the symptoms, not the problems” situation.

Europe’s decline will continue until they decide to take responsibility for themselves and to overthrow an ideology which prioritizes the rich and financial games over the entire population and the real economy.

Immigration is meaningless in comparison.

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