Ian Welsh

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

Category: The Twilight of Neoliberalism Page 5 of 11

Understanding and Surviving the Post-Prosperity Era

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On September 16, 2022

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I don’t usually write about my personal life much, but today will be an exception.

The other day I had to go the hospital, to a cancer clinic (nothing to sweat, I have a type of cancer with a 98% survival rate) and the clinic I was at had only one doctor. It normally has three or four. I asked the nurse, and she told me that the others were out with Covid.

Emergency departments across Canada are having shut-downs because they don’t have enough nurses. Covid, either temporary, or nurses having quit because they can’t take the over-work any more.

Before Covid, at the same hospital I’m going to now, imaging tests for possible cancer got done in a month. After Covid, it was about 8 months, and treatment didn’t start until about 11 months. Before, 2 months.

As I say, I’ll probably live, but if I die of cancer, it will be because of, not Covid, but because of the way Covid was mishandled. For cancer, how fast you act matters. Taking an extra 9 months to start treatment isn’t a small thing: it’s a lot of dead people.

If I die, it’s a marginal (or excess) death. It doesn’t get put down as Covid, and it isn’t, but it is because of how Covid was mishandled.

And, of course, what is the government response to hospitals being slammed “we should get the private sector to do some of this stuff.” Classic neoliberalism: “make service shitty, then privatize.”

But this sort of thing is all across the spectrum. I’ve got friends on the edge, people who would have been OK ten years ago, who are now not OK. The cheap places for rent have mostly gone away; generally speaking rent at the bottom end in Greater Toronto is up about 80 to 100%, if you can find anything at all at the bottom price ranges.

More homeless people. More people paying most of their wage on rent and skimping on food and dental and medicines, because universal health care doesn’t cover dental, and Canadian drug prices are bad, just not completely “American whacked.”

As conditions get worse, people who would have made it, don’t: they get pushed off the edge, because there isn’t as much “safe” space. Homeless, sick, dead, poor.

I’m poor, have been for somewhat less than a decade now, and I’ve been poor in the past, particularly in the early 90s. (In the old days I didn’t ask readers to funds, because I didn’t need to.) I don’t use social support other than some help for cancer meds but when you’re poor, who you know includes other poor people

This period is far worse for people on the margins than the early 90s were, and they were, anecdotally and statistically, worse than the 70s.

So there are more homeless.  More dead people. People who under previous regimes would have made it, stayed housed, stayed healthy, stayed alive, aren’t.

It’s a trend, it’s been a trend for over 40 years now, but it’s an accelerating trend.

The rich are running out of money to take. In America and the UK they’ve shattered the middle and working classes, In Canada and much of the rest of the world they’re working on it. I’d guess Canada has 15 to 20 years before it reaches about where the UK is now, and where the UK is that they’re going to slide to 3rd world status. In principle it can be turned around, but in practice it’s unlikely to be. That’s why I supported Corbyn so hard, because he was the last chance they were going to get.

This trend is accelerated by climate change, and by the insistence on fighting a cold war with China and Russia. Right now the primary target is Russia, yes, but the real target in China. Breaking Russia would weaken China massively, and China is the actual threat to the current hegemonic structure, not Russia, which is not a superpower any more, just a great power (and a fairly weak great power in certain ways.)

The point here is that the way the elites are running the world, and most nations, and Canada where I live is a direct threat to my life at this point, and to many many other people. I have joked that I’m damn glad I got cancer now, because even though treatment is delayed, I’m getting it. In 10 years, I don’t know. I’m seeing stories in the UK of people who have to go private because the NHS is so overwhelmed.

To state what’s obvious private isn’t some miracle. It doesn’t create resources the society doesn’t have, it just distributes them differently: to those who can pay. In fact, generally speaking private uses more resources, because it has to make a profit.

Meanwhile the fact is that the world’s resources are actually shrinking. When climate change dries up rivers and burns up forests and increases bad weather and droughts; when aquifers go dry and glaciers and snow packs(resevoirs of water) diminish and die; when biodiversity crashes and fish stocks go away, the real resources we need to survive are being reduced, close to permanently, since recovery will take a long time even where it is possible.

With people having less resources, they can withstand less shocks, and with resources concentrated at the very top end, many people can’t take hits. More and more people are one hit away from homelessnes or death, and to top it all off Long Covid disablement is soaring and will soon be in the double digits in many Western nations.

This is, then, the culling. It’s been going on for a long time, but it’s speeding up. I wrote for a couple decades to warn other people, and now I can see my personal horizon: I can see when I’ll be on the edge. I’m already on the edge, really, as my emergency fundraiser (a first) and the delays in my cancer treatment show. I used to be able to keep other people out of poverty with help, now the aid I can give is restricted. I’m no longer much of a material resource for other (though I help with showers and food and sleep).

But this isn’t mostly about me, it’s about a lot of people being pushed towards the cliff. It’s about you and people you know. Even a lot of people in the middle class have no resiliency left: one bad bounce and off the cliff they go.

The next stage is the elites turning on each other. Having stolen all the fat and most of the muscle of the lower and middle class, they’re going to see no choice but start chewing on societies organs and to start seriously preying on each other, because there’s hardly any reserve left. In the UK, the NHS is the only major thing left worth selling. Once that’s gone, there’s nothing left to loot. All the stuff worth having will be held by other rich people.

Now, there are a few points here, and readers will have picked out some of them, but let’s state a couple clearly.

First, a lot of people, a hell of a lot of people, aren’t going to make it. If you want to not be one of them; if you want your friends and other people you care about not to be one of them, you’re going to need to do something. Probably the best thing is to organize in groups. Do what you can to help yourselves, and make it clear to the rich and powerful that  your problems are theirs: that if you get pushed off the cliff, you’re going to make it hurt them.

The second is that on the mass scale, it’s now us or our elites. They go, or we go, and they want it to be us.

Plan for this era. Climate change is now and it’s just going to get worse and our elites are going to become greater and greater predators, trying to liquidate everything they can find to keep themselves in power.

Remember that personal resilence has its limits: you need other people who care about you and have the ability to help. You need more than family, you need a community, a group and that group needs to take care of its prosperity and have a commitment to caring for its own people.

We did that thru government for a long time, but government isn’t going to hack it for a lot of people. When times like that happen, you form your own mini-governments to do what larger society won’t.

It’s sad, it’s bad, and it’s what millions of people, including myself, spent our lives fighting to avoid, but it’s here and that’s just how it is. Even if some societies turn it around and start doing the right thing, it’s unsure which ones those will be and by the time they get to it, if you aren’t caring for yourself and your chosen group, you may be dead or on the street.

And understand that everyone’s doing the wrong thing. No major society is taking this seriously. When they stop building suburbs and stop pushing cars and stop allowing planned obsolescence, you’ll know they’re serious. No government which has not done at least those three thing is serious, and since our entire economy is built around cars, real-estate expansion and throwing shit out which was designed to last only a few years, we haven’t even started.

Be well, take care of yourselves, and if you can, please organize and take care of others.

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The Trifecta+ Which Will Make The Next 100 Years Hell

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On August 19, 2022

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The Course of Empire by Thomas Cole

The Course of Empire by Thomas Cole

We have three major challenges all coming to peak close to each other.

Or possibly four, depending on how you define your terms.

First: the end of a sub-ideological era. Neoliberalism is on its last legs, just as New Deal liberalism was in the 70s. Ends of sub-ideologies tend to be tumultuous and it’s worse when it’s the end of a fundamentally extractive sub-ideology like neoliberalism, than it is with the end of a “building” ideology like the New Deal which worked to strengthen people, regulate companies and build vast human and inanimate infrastructure.

Neoliberalism was, fundamentally, the realization that all that build-up led to a huge looting opportunity. Get rid of the regulations, stop enforcing anti-oligopoly laws, force massive asset bubbles and those on the inside could get stinking rich.

The New Deal was a reaction to the problems created by a certain type of exploitative capitalism: a “we can’t allow this sort of abuse”, where neoliberalism was “man, abusing people, and destroying/privatizing institutions makes a lot of money.”

So, the 70s sucked, but they were nothing near as bad as the great depression and WWII.

But that’s also because the transition to neoliberalsim did not coincide with—

Second: the end of a hegemonic era. 1914 to 1945 is the end of not just British but European world hegemony. At the end WWII the USSR and US divide Europe in half, with the US controlling the Western half and the USSR the eastern. That the America glove was often velvet, did not change the fact that there was a steel gauntlet underneath (look up Gladio, as an example.)

The death tolls of WWI (21m), II(50m) and the Great Depression (uncounted), plus the anti-colonial wars, famines and the Japanese conquests(14m) and colonial wars is in excess of a 100 million. At the end of WWII, the world population was about 1.33 billion people. That’s a lot dead people and we aren’t counting all the people who were maimed, impoverished, made into refugees, raped or tortured. Nor are we counting the USSR pogroms (we probably should) or the colonial famines (we probably should.)

Hegemonic powers do not go easy into the sunset, and the more powerful they were, the harder they die.

But although there were some serious environmental problems in this era (the dust bowl, for example), the simultaneous end of the hegemonic and sub-ideological cycles which occurred in the early 20th century (which includes communism), didn’t have what we have coming—

Third: a worldwide environmental crisis which will reduce the Earth’s carrying capacity semi-permanently. At best reversal will take hundreds of years and be partial, because we aren’t going to be able to un-extinct all the species we’re killing and the depth and vibrancy of the ecological web is a huge part of Earth’s biological carrying capacity.

So, we can reasonably expect that a significantly greater proportion of the Earth’s human population will die during the upcoming period and more people will be impoverished, tortured, raped, turned into refugees and so on. It is not impossible to imagine a scenario where that didn’t happen, but it requires human social groups to act with decisiveness, wisdom, compassion and forethought which have no precedent in human history I am aware of.

These is what I’ve partially labelled in my categories as “The Age of War and Revolution” and “The Twilight of Neoliberalism”, but they are much larger than that.

Now there is also a larger cycle coming. You’ll note that I kept calling New Deal Capitalism and Neoliberalism sub-ideologies. They’re both capitalist ideologies, and the capitalist world-system has been around since the late 15th century, blossoming with the industrial revolution into a global world-system. Previous to this, contradicting the name, most world-systems didn’t cover the entire globe, but capitalism did. Even communism was part of the system (that’s an entire other article, but the USSR was not in autarchy and was forced to play the game by capitalist world rules.)

Capitalism is ending. There are a bunch of reasons (follow the prior link), but one big part of it is simply that it’s going to have been seen to have failed and be blamed by everyone for the environmental crisis (it’s not just a climate crisis, ecological collapse is at least as important). Democracy stands a chance of getting it in the neck too.

We aren’t just going to be changing sub-ideologies and swapping hegemonic powers and dealing with an enviro-collapse; we are going to be changing how we fundamentally run our societies, because it is almost certain that you can’t be capitalist and fix the environment, and in any case, again, capitalism will totally be discredited by all the deaths and catastrophes during this era.

Likewise, we are going to have to transition from the hydrocarbon era which has run since near the start of the industrial revolution because we cannot fix our environmental issues and have hydrocarbons be our primary energy source.

So, depending on whether you count the transition from capitalism to whatever, we’ve got the end of 5 eras or so. (WWI to II also saw a sub-transition in energy, from coal and steam engines to oil and internal combustion.)

This is compounded by the fact that end of sub-ideological and ideological eras always occurs with fanatically incompetent elites in charge. The classic western example is the fall of Rome, but look at the Weimar Republic, at Hoover, at Nixon/Ford/Carter and so on. The generations who created the previous system are dead or out of power and their heirs are boobs who don’t know how to repair their system. When the Lost generation, the last generation to remember the 20s, not just the great depression) died, a subset of the GI and Silent generations then destroyed the New Deal, both negatively (unable to deal with the oil shocks) and positively (Reagan/Thatcher/Friedman, etc..)

The people in charge now are radically incompetent at everything except internal power games. They are good at accumulating money and staying in charge and bad at everything else. They cannot fix any problems, at best they mitigate, and their mitigations (such as central banks printing money in response to the 2008 financial crisis) make underlying problems worse. On top of simple mechanical incompetence, they are also unimaginative: they cannot conceive of different ways of running society. Even when there are partial exceptions (Chinese leadership handling Covid semi-competently is an example) the elites can’t see their way to ending the ideology (capitalism, and yes, China is a capitalist mixed society) which is destroying the conditions for its own existence.

So this is where we are: the end of an ideological era; the end of a hegemonic era and a huge environmental crisis, all of which can’t be handled without fundamental ideological and leadership changes and which an reasonably be expected to kill billions of people while we “figure” or “fumble” it out.

Welcome to the fin de siecle. More than one. Enjoy the fruits of decadence while they still last.

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The European Position at the End of the Unipolar World

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On July 21, 2022

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It’s hard to remember now, but in the early 2000s, the EU appeared to be the onrushing power. It was gaining new members, who clamored to join, both its economy and the Euro were strong, and it had avoided entanglement in Iraq. Its prestige was high (having nations begging you to let them in their club tends to do that).

What I suggested the Europeans do, at the time, was try and make the Euro into an alternate reserve currency. They also should have increased their military, making them non-reliant on the US in the guise of NATO. Within the EU, steps needed to be taken to stop the abuse of the Euro by Germany as a subsidy for its manufacturing (because the Euro was lower than a pure-German currency would have been) and to allow genuine subsidies in other countries to make up for the disadvantages they would incur as a result of using a Euro — which was priced too high. Aggressive moves towards energy independence would also be necessary, as Europe was –and is — obviously resource deficient.

None of this was done. It appears that EU leaders were comfortable being US subjects, or at least, they didn’t want to challenge it. Germany’s policy towards Russia was trade, sold on the assumption that trade alone would make them good little Europeans, without offering them a path into either NATO or the EU, and with the added insult of allowing and participating in the looting of Russia during the 90s.

As for economic policies like subsidies and some counterweight to German exports, well, that would contravene the neoliberal, technocratic ideology that very much rules Eurocrat elites: the rules are the rules and if your economy gets trashed by them, as Finland and Italy, among others, found out.

In 2008, the Europeans followed the Fed (and, admittedly, everyone else) into a gigantic bank bailout, then spent most of their time since printing money for rich people (a reasonable description of central bank special operations during that era).

Meanwhile, anti-Russia sanctions proliferated, Russia-EU/US relations deteriorated (especially due to to the fight for influence over Ukraine — but that was definitely not the reason), and it all flared into crisis when Russia invaded Ukraine after years of Ukrainian military operations in the Donetsk and Luhansk Republics.

That led to sanctions, which have so far hurt Europe worse than Russia, as the European (and especially German) power grid needs Russia natural gas and coal which they can’t easily obtain elsewhere. Damage to industry has also occurred, and some observers expect it to cost entire German industries and millions of jobs; nor is the rest of Europe unaffected.

The problem now is that a fast move away from natural gas, oil, and coal isn’t possible. Heat exchangers work, but there aren’t enough available. Renewables are great, but transitioning takes time and anti-Xinjiang sanctions mean that 50 percent of the world’s silica supply, along with much of its solar panels, are no longer available.

Meanwhile there’s a heat wave, Europeans don’t have air-conditioning, and live in buildings largely designed for cold weather (with some southern exceptions), and, as everyone loves to say, “Winter is coming.”

Transition is not impossible, but it will take time. It is going to require restarting any nuclear plants which can still work (the numbers do not work without it) and probably building some new nuclear reactors, along with a buildout of various forms of renewable energy. Even moving to imported, and more expensive, US natural gas is not as easy as it seems: it requires infrastructure which does not exist.

Russia, meanwhile, as we’ve discussed before, is restricting natural gas supplies and threatening cutoffs. They can’t buy European goods, and they need the money less than Europe needs gas, coal, and minerals. They are diversifying to the East and South as fast as they can. Add to that to their position as one of the world’s largest grain producers is serendipitous at a time grain production comes under pressure from climate change, and consider that they are capturing a fair bit of Ukraine’s farmland, some of the most productive in the world.

Then there is China. Europe does a lot of business with China and there are massive trade ties. But Europe continues its anti-China rhetoric and keeps putting on additional sanctions against China. China wants the European market, and there are still some advanced items they need to buy from Europe, but political considerations, especially with regards to Taiwan and Xinjiang, may trump such considerations. In particular, it is not in China’s interest for Russia to be defeated or broken up as so many in Europe want, as Russia is a key supplier without which China cannot resist a US naval blockade.

Europe finds itself in a position where it’s scared of Russia and outraged. Eastern Europeans in particular want a complete hardline because they genuinely fear conquest or Finlandization. Without reliable access to Russian resource, Europe is forced to rely on the US and various unpleasant Middle Eastern states and to pay higher prices.

And meanwhile, the simple fact is that transitioning to energy and resources without Russia is hard and will take years. I’d think a full transition, even if done competently, will take a decade or so. Combined with the need for the US in order to stand up to Russia (EU militaries are a joke, Ukraine actually had the largest one), and the Europeans find themselves completely back in US satrapy mode. The US is sending more troops and building bases and that’s how it has to be, if hostility to Russia remains.

Which means that the EU has another task: it has to build its own military, capable of standing up to Russia. This is by no means impossible: Europe is technologically advanced and still has the necessary industry, including world leading aviation, but right now all that is happening is buying more US made weapons and hosting more US troops.

If Europe wants to be anything but a satrapy, it has to fix it energy and resource issues; it has to build a military and it needs to do something even harder—it needs to rethink its ideology, and allow proper industrial policy internally. This is hard to do when it’s dependent on outside resources from a hegemonic power, but if it refuses to do so, it will remain an American satrapy.

How much of this will be done is unclear. Exchanging reliance on Russia for the US may seem like an improvement, but it is still dependence and if Chinese relations sour, the Europeans become “locked in”, with few options.

It’s hard to imagine the current generation of European leadership managing this well, but perhaps they will surprise or, more hopefully, perhaps they will be replaced by more competent politicians.

But overall, it looks like Europe is slowly marching towards its historical norm, less and less important and powerful on the global stage.

A lot, of course, will depend on climate change and who gets hit the worst and handle it the best, but right now Europe looks to be in decline, with an opportunity, if they take it, to use this crisis to come out stronger and less dependent on outsiders.

I hope they take the opportunity.

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Russia Turns Up the Pressure (and Turns Off the Gas) on Germany and the EU

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On July 18, 2022

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Well, well…

Russia’s Gazprom has told customers in Europe it cannot guarantee gas supplies because of “extraordinary” circumstances, according to a letter seen by Reuters, upping the ante in an economic tit-for-tat with the west over Moscow’s invasion of Ukraine.

Dated 14 July, the letter from the Russian state gas monopoly said it was declaring force majeure on supplies, starting from 14 June.

Known as an “act of God” clause, a force majeure clause is standard in business contracts and spells out extreme circumstances that excuse a party from their legal obligations.

So, Europe and Germany get gas in exchange for rubles. But Russia can’t spend those rubles for most of what it needs from the West.

The question is, does Europe, especially Germany, need gas more than Russia needs rubles and an increased exchange rate (not always a good thing)?

Everyone has been concentrating on the winter and assuming Germany didn’t need much gas until then, but a great deal of Germany’s electrical grid is supplied by natural gas plants, and as you may have heard, there’s a heat wave in Europe and most of the rest of the world.

So much for air-conditioning. And if much of Germany’s industry will have to shut down as well.

Germany can lose a huge chunk of its industrial base if this continues. The whole “keep buying gas from Russia until we can transition off of it” idea was always dubious, because other gas is much more expensive, but it also rested on the idea that Russia was desperate to keep selling; that there was a symmetry of needs.

But Russia will suffer a lot less without sales than Europe will without gas, and in any case, a shutoff will likely increase the price of gas they are selling elsewhere, making up some of the losses.

The fact is that Germany, an industrial state without a lot of resources, and Russia, a resource state, are natural economic allies, but Germany needs Russia more than Russia needs Germany.

The companies who have been given notice that of force majeure are saying they don’t accept it, but what are they going to do?

The grace period for payments on two of Gazprom’s international bonds expires on 19 July, and if foreign creditors are not paid by then the company will technically be in default.

This is a non-threat threat, because Russia has already defaulted on loans, as it is largely shut out from the Western banking system and thus can’t even transfer the money. (As happened to Argentina.) More defaults theoretically mean that Russia will be unable to access Western loans and so on, but they already can’t, and they have access to the Chinese banking system, which is larger than any Western country’s and perfectly capable of keeping Russia and Russian companies afloat.

Understand clearly that most Germans and Europeans support the anti-Russia sanctions. This is a popularly backed policy: Europeans are paralyzed by fear of Russia and were long before Ukraine. I had a friend in Austria tell me how he scared he was of Putin back in 2016.

We will, however, see what the result of this is. I would guess that in the short-term, it will stiffen opposition to Russia, but I’m less sure about the medium- and long-term. German elites, especially, will feel a need to end the Ukraine war and get back to a steady Russian supply.

No matter what, however, it highlights the price Europe is paying for its anti-Russia stance.

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One Chart To Predict The Future of Civilization Collapse

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On June 29, 2022

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I first read Limits To Growth sometime around 1982. Limits used computer models to predict possible futures of resource use, pollution and population over-shoot.

At the time I thought it was right, and everything since then has come in about as it said.

I found this chart from it, with a couple of added date lines in an excellent post on the retrospective book “Limits and Beyond.”

The chart’s a couple years off, but notice that we’re hitting the food per capita just a few years after it expected. You can say “this is because of the Ukraine war” but we were at the stretching point, which is why one war (and a bunch of stupid sanctions) were able to do this.

Note that services and industrial output are expected to peak around the same time. Population starts dropping in about 20 years and the death rate goes vertical about the same time.

Notice how extreme the declines and rises are once they get going. This should be familiar to people from the Covid pandemic, but these trends will last for decades; indeed for generations.

I’m not sure I entirely buy the population model. It’s based on the fact that poor people have more kids, with some delay, but I think the one things the Club of Rome didn’t entirely take into account is how bad climate change and ecological collapse will be.

The point, now, is that we’re about at the peak or slightly past it. The collapse has started. Covid and Ukraine pushed us into it, but it was going to happen anyway, and there’s always an inciting event. What has changed is that there was no slack in the system (and no competence, with the single major exception of China) to deal with it.

The second point is, again, how sharp these declines become, often almost immediately after they start.

Food isn’t going to get cheaper almost anywhere for a while. Then what will happen is that multiple countries which have surpluses will disconnect from the world supply network so they can feed their own people. This won’t be done for humanitarian reasons at home, our elites don’t have such feelings, it will be done because food shortages are the fastest route to revolution, and that includes food shortages caused by too high inflation. If the food’s out there any can’t afford it, it amounts to it not being out there.

This chart doesn’t break out water specifically, but in a lot of places water is going to be in serious shortage. We’re going to lose a lot of river flow and a lot of rivers and lakes outright, because they are fed by glaciers and snow pack which are already in precipitous decline. In some cases there will be an increase before the decrease: floods and so on caused by more water flow as glaciers melt faster, but then there will be almost none.

In many regions there’ll be more rain and there’ll be more rain overall, but it’s not going to make up for the lost river flow and lakes, or for the aquifers we have drained or poisoned.

This is the map, it may be off in a few places, but it’s going to be essentially correct. It didn’t have to be, the book was published as a warning so we could change our ways, but we didn’t and so it’s turned from possible prediction into prophecy.

Come back to this chart over and over again as you think about and plan for the future, but remember that it is a global chart: local areas will have different profiles and charts especially as we de-globalize, and in response to this collapse we are going to de-globalize with a vengeance.

There are certain places you just don’t want to be, which will get hit earlier and harder. In the US, much of the Southwest and south (Texas, for example.) In Asia: Bangladesh in the first wave, then India soon thereafter. I don’t know Africa well enough, but the same regional effects will occur there.

On the human scale there will be mass migrations, refugee waves of tens to hundreds of millions and war over water and arable land. Multiple societies will collapse into warlordism.

This is the future.

Our future.

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Is Capitalism Near Its End?

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On June 7, 2022

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In the book Does Capitalism Have a Future?, Emmanuel Wallerstein argues that capitalism cannot be saved because capitalism requires the endless pursuit of profits, and the world system is at a stage where there is no room for another wave of exploiting people who are largely outside the system, which capitalism, in its modern form (from about the late 15th century), requires.

The ur-rule of capitalist behaviour, per Wallerstein, is that one must pursue ever-higher profits. If one doesn’t, they’re out of the game. (You and I, dear reader, are not in the game and never were, unless some billionaire or CEO is reading this.)

If you don’t pursue endless profit, you fall behind those who do, and they buy you out, or you go bankrupt, or even you become a small or medium business and have no real power. To have power in capitalism, one must be ever striving for the apex. It’s a red-queen’s race, as in “Alice in Wonderland.”

“Well, in our country,” said Alice, still panting a little, “you’d generally get to somewhere else — if you run very fast for a long time, as we’ve been doing.”

“A slow sort of country!” said the Queen. “Now, here, you see, it takes all the running you can do, to keep in the same place. If you want to get somewhere else, you must run at least twice as fast as that!”

Now, the next thing is that capitalists actually don’t like workers who fully depend on them for survival: they want workers who have other supports; generally some sort of subsistence or government support. Traditionally this would be workers in hinterland regions (in Europe or Britain to start) who still had some land or animals and took the work only to get some extra money.

Other arrangements did exist: You could pay them less than they really needed to survive (the early British proletariat, as can be seen from accounts at the time), or, in the modern world, you can be Walmart and instruct your workers how to get food stamps, welfare, and medicaid, as you pay them less than they need to survive.

Various other companies, including Amazon, who rely on similar supports and school, which is a form of babysitting, can be seen this way as well; workers who have to care for their own children 24/7 can’t work. Extended families, in countries which still have them, do the same thing — grandparents or other relatives care for the children while the parents work.

Each wave of capitalism has gone out to places where there were still people with extended families and means of subsistence, and brought them into capitalism. At first it was cheap, then wages rose as workers became proletariatized and wanted their wages to cover their actual expenses.

Getting government to step in and subsidize workers is a poor substitute, which can’t work in the longer run, because the workers still have to be supported. Even if a specific company is dodging all its taxes, someone is paying, and if that someone is the workers, well, that strategy is only viable while there is wealth to steal from the poor and middle class, because – obviously — taking wealth from the rich defeats the point.

The last wave, to Wallerstein, was this last wave: There are no countries of significance not in the capitalist system, and there is no significant group of people with extra-subsistence to bring into the system to support cheap labor.

Without this, the current form of capitalism is doomed. Profits can only be increased by impoverishing societies as a whole, which destroys the wealth customers need to buy goods.

Though Wallerstein doesn’t emphasize it, there’s also the issue of simple depletion of minerals and of climate change. There are plenty of hydrocarbons in the world, but using them is destroying subsistence, food production in general, and drawing down water, and so on. We are running out of other materials, almost exactly as “The Limits To Growth” report predicted five decades ago.

The reason people like Bezos and Musk are obsessed with space and automation if that if space mining, colonization, and automation are the only viable solutions can the resource constraints and the expansion constraint be broken. It’s the only way that this style of capitalism continue, possibly nearly forever, by expansion to new worlds, the asteroid belt and so on.

Unfortunately, with our current technology, space colonization is a no-go. We can’t even create a biosphere (a closed environment) capable of supporting anything more complex than mold slimes. We can’t deal with the radiation in space. Mars colonization without terraforming will be very limited; it’s a more hostile environment than Antarctica, which we haven’t been able to colonize either.

So, assuming you agree with Wallerstein’s model of modern capitalism, at least in its broad strokes, there’s no way for capitalism to survive.

If it is near the end, what you’ll see is a structural crisis with wide fluctuation. Change to a new equilibrium generally happens with snaps to the new equilibrium, then snaps back. At first, the snaps to the new equilibrium are brief — over time, they become longer and eventually there are no snaps back.

This is also likely to be the case for climate change, the question is where the new equilibrium will be, which is not as easy a question as some people think, because while earth has had high carbon in the past, conditions then were quite different. One example is that atmospheric pressure 2.7 billion years ago was half what it is today.

In any case, whatever the new equilibrium will be is unclear, both socially and environmentally, and how the social equilibrium sets will work is also dependent on where the climate stabilizes.

So at this point, we can say, if we find Wallerstein persuasive, that the modern form of capitalism, which has run progressively larger parts of the world for about five centuries, is on its last legs. What we can’t say is what will replace it.

The goal of those of us who see what is happening is to create ideas; ideologies, which will be available when change becomes so imperative that people are desperate, and reaching for new options. If we don’t, the worst people will dominate with their worst ideologies, and the new system could be even worse in many ways.

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Civilization Ending Long Covid Pt. 2 — 320K Long Term Sick In UK Labor Force

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On May 18, 2022

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Starting in 2020, an increase of 320K long term sick people. We tend to do percentages off the population, but the UK Labor Force is 34.7 million people. That means, in 2 years, what is probably most Long Covid, caused about a .92% decrease in the labor force just due to long Covid. Another .38% of the population left the UK Labor force for other reasons.

Where’d I get this from? The Bank of England!

Since end of 2019- we’ve seen a fall of 450,000 (1.3% of labour force- a very large decrease in labour force … The persistence & scale in this drop has been a surprise to us. We’ve seen an increase in long-term sickness in that number – around 320,000 people…

…Falling participation in the labour market is not a lack of job opportunities, but a rise in long term sickness linked to the pandemic. The issue of Long Covid is very serious.

Last week I wrote that a big part of rising labor costs was a tight labor market and…

much of why the labor market is tight is because they let a million people die and probably millions be disabled by not handling Covid

I’ve been emphasizing for a long time that Long Covid was going to be the real problem. .92% may not seem like much, but remember:

  • You can get Covid over and over again;
  • There is no long lasting or complete immunity from Covid either from vaccines or natural immunity;
  • New variants are being born all the time and the ones which survive and thirve are generally optimized against whatever is the biggest barrier to current spread;
  • Each time you get Covid you can get long term damage. It may not be sympomatic, but it’s there.
  • So the next time you get Covid, you’re more likely to get symptomatic Long Covid.

Let us assume, for the sake of argument, that UK and US reductions in the labor force are about the same, in percentage terms. (Death rates in the UK are slightly lower than the US, but I don’t trust either country’s stats all that much.)

The US Labor force in 2021 was about 161.2 million. Multiply that by .0092 and we have a reduction of approximately 1 million, four hundred and eight-three thousand people (1.483 million). Now, imagine the US loses that number of people from the workforce every two years?

Doesn’t take long from those numbers to be catastrophic, does it?

Understand that marginal rates control the capitalist market.

The good side of this is that taking so many people out of the workforce absolutely will increase wages without wage controls. And it will keep doing so for as long as we refuse to control Long Covid and have no effective AND widely deployed cure. Problem is, while we do way too much bullshit labor and could get by with less workers, I doubt it’s going to be Wall Street parasites whose jobs we don’t fill, it’ll be people who actually make, grow, mine or distribute goods that matter, and people like nurses and orderlies and teachers and so on who are actually productive, rather than parasites at best.

Meanwhile, China, who supposedly wrecked their economy with Zero-Covid, will not be suffering under this reduction. (The Shanghai outbreak is now almost completely under control, much to the dismay of pro-death and disabling neoliberals.)

And this is before the fact that we will need to take care of all those sick people, though I suppose the American solution will be to let them use up all their savings, get thrown off any private healthcare, perhaps manage to get on Medicaid and eventually wind up on the street and die.

Blah, blah, blah.

The point is that our civilization CANNOT survive this sort of disabling if it just keeps going on and on. Multiply by all the problems we’re going to have with climate change, and stir in a mix of nuclear-armed Great Power competition and the results are catastrophic.

It’s Long Covid or a real cure or a miracle where Covid dies out by itself (not seeing how that happens when natural immunity is limited), or we are in for a world of hurt.

Take precautions. It’s not death you should worry about, it’s disabling. I don’t know what happens after death, but I do know that a lot of very bad things can happen to you while you’re still alive.

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How Big Is The Chinese Economy Compared to The West?

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On April 21, 2022

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I recently came across these charts, of the biggest trade partner of each country, from 1990 and 2020.

To simplify: China is now more dominant in trade than the US at the height of its recent power. (Also of interest is the change in the UK and Japan’s position, though the collapse of Japan is overstated: it’s not , but it’s still a big trade power.

Let’s put the 2020 chart in numbers, bearing in mind that doing it in US dollars will overstate the relative size of the US.

For imports (from Wikipedia):

So, China is the primary trade partner of far more countries than the US. It exports more than the US, and imports less. These numbers understate the situation, though, since they are “goods and services.”

French Economist Jacques Sapir recently did an economic comparison by adjusting GDP numbers (not trade) as follows. First, change them for purchasing power parity (PPP), which is to say you can buy more with the same amount of money in China or Russia than in the US or Germany. Then adjust for the service sector being overvalued, so you’re left with manufacturing and the primary sector (digging things up and refining them) as the primary drivers.

Do this and Russia’s economy is 5% to 6% of the world economy, and much larger than Germany’s. China is about 30%, and the EU + US are about 30%.

Now I don’t entirely endorse this, there are some useful things in “services” like parts of the tech industry (much is worthless though, serving ads better does not increase a country’s actual economic strength. It might sap it.)

But it puts the situation in better perspective than using raw GDP.

Really there are three primary drivers of actual economic power: manufacuturing, resources and technology. Everything else either exists to service those 3 areas, or is nice and maybe even important to social stability (law, entertainment) but not primary.

China is the world’s primary manufacturing power. Russia is a powerhouse for resource exctraction. Russia is a leader in some types of military technology and not far behind in many others, and China is rapidly closing on the West in terms of tech and is even ahead in many areas (5G, for example, or hi speed trains, civilian use of drones, and so on.)

China also has something the US doesn’t have: a belief in technology. Robots and drones are common, technology is viewed as good, not bad and a threat. The Chinese believe in the future in a way that the west hasn’t since the 50s.

On top of all of this China is the world’s largest developer of nations: if you want ports, roads, train stations, hospitals, schools, smart cities or anything else, China will build them for you. They’ll finance them, and some exceptions aside they offer good loan rates because usually they’re more interested in good trade relations and getting your food/oil/minerals than they are about making a profit off building the infrastructure. In addition, Chinese construction companies building overseas infrastructure means those industries don’t have to downsize: they build China, now there isn’t enough work, so they’re off in Africa and South America.

To summarize then: China is:

  1. the number 1 trade partner of more nations than anyone else, and more than the US had in 1990.
  2. the world’s largest manufacturing nation
  3. Technologically near even with the West, and in some places ahead.
  4. The nation that helps the most other nations develop.
  5. When you adjust for PPP and service sector crap, a larger economy than the US. With Russia, a larger economy than the US and the EU combined.

And this is the nation we want to enter into a Cold War with? We shipped them so much of our industry that they now have more than we do, and after doing that we decide it’s time to pick a fight?

One thing is true of post-industrialization great politics: industry, access to resources and tech are what determine power. Since there is no longer a situation where the West has technology that is vastly ahead of everyone else’s, it really comes down to industry + resources.

And with Russia locked in and South America and Africa tending to prefer it, China is ahead or secure in both of those those categories.

If we wanted to keep our supremacy, we had to not ship China our industry and our tech so we could make some of our elites even richer. The Chinese accurately sized up our elite’s weaknesses and exploited them to the hilt. They thought they were “international” elites and it didn’t matter where the manufacturing was done, or who had the technology. The Chinese, however, were a national elite, and they knew it did.

I’m not sure this was exactly a bad thing. The West, in the unipolar moment (and heck, before) vastly misused its power, over and over again. Maybe a two-polar world will be better, if it isn’t, at least all power won’t be centralized in America with a few satrapies getting a voice and maybe that will be better for many countries and billions of people.

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