312 replies to this topic

[Mind]

Is the world headed for another Great Depression and World War?

I am usually an optimistic person, but one recent seemingly innocuous news item caught my attention and my emotion: France and Germany to propose closing the borders. I always viewed open travel and free trade across European borders as a positive sign for the future, not only in Europe but across the world. Now the dream of free trade and easy travel around the world is crumbling with the advent of the Great Recession, but will it become a Great Depression?

Reading doomsayer and bearish economic blogs, one would think that every week, every month, and every year, we are heading toward another Great Depression and/or hyper-inflationary collapse. When viewed from the standpoint of basic human action and the production of goods and services of real value it is easy to see how the current economic model is unsustainable, because of its inherent need for exponentially increasing levels of debt.

Before reading any further, consider some viewing some good backgrounder information on the fundamental workings of the current economic system:

Money as debt I
Money as debt II

One can make some minor quibbles with some of the methods of debt generation and interest payment, but Money as Debt is an overall good description of the history and functioning of the debt economy.

While it would seem that the world is getting tight on traditional physical resources, we live in an age where an increasing amount of the economy is driven by intellectual resources. From the rapidly increasing levels of productivity to the seamless delivery of information, it would seem as though we are headed for another golden age of human history. By leveraging and amplifying our intellectual resources with the help of software and connectivity (the Internet) one cannot help but feel that there is a workable solution to every problem.

This optimism is not new. Thus was the general mood during the 1920s in the United States, noted as the “Roaring Twenties”. Different technology and resources drove the prosperity and optimism back then. Exponentially increasing value of securities was one of the bedrock markers of the wealth of the “Roaring Twenties”, and like all unsustainable trends, it ended. But unlike other manias and burstings of economic bubbles, the first Great Depression was prolonged (according to many) by government spending. Instead of allowing the economic system to reset to a sustainable level, governments, the U.S. in particular, created money and mostly unproductive work in order in an attempt to “save” the economy. Trade wars and eventually a real world war developed. One could argue that the causality is not perfect but it does have historical precedent.

And the same thing is happening today. History might not be repeating itself exactly but it is rhyming. Why are Germany and France proposing to close their borders again? Why are the U.S. and Europe increasing trade barriers with China? Why are more wars on the horizon? How can we be on the verge of another Great Depression and increasing threat of war when technological progress has brought more comfort and wealth to more of the world's population? Is the the level of debt an unsolvable problem? Is an economic crash and depression the only possible result? The “Money as Debt” series would seem to argue yes. Debt seems to be the root of the problem in a fracturing Europe. Too many governments have promised too many benefits to too many people. Too many banks extended too many bad loans. “Austerity” has been the catch-phrase in recent months, but considering the election in France, this is not sitting well with the population (for obvious reasons) as the leading candidate is promising more (debt generated) benefits to more people. The level of debt in the U.S. is growing at an unsustainable pace as well.

Given the benefit of history, one would think we would not repeat the same mistakes as the past. Arguably one of the most powerful people in the debt-based world economy, the Federal Reserve Chairman of the U.S., claims to be a “student” of the Great Depression. Curious then that the world and the U.S. are following the same path as in the 1930s; trade barriers, issuing more debt, creating more money, paying for unproductive work, etc... About the only thing the FED has not done (or promoted) yet, that does not rhyme with the first Great Depression is raise interest rates, and it seems the FED chairman will go to his grave defending and promoting the zero percent (essentially) primary interest rate and his war on saving.

I do not want trade barriers. I do not want war. I do not want hyperinflation. Being a member of the Immortality Institute (and now Longecity), it has become increasingly hard to understand borders. We work across the imaginary political borders of the world for the benefit of everyone. I would hope that our efforts would be replicated in other areas of human endeavor, and they are, but again there is this counter-current of the collapsing debt-based economy.

I have no quarrels with most other peoples of the world. Then again, I have not been hit too hard by the current Great Recession. Sure, the FED's war on saving is tough for someone frugal like myself and the FED's inflationary policies are robbing more purchasing power every day, but I still have a job. I have a roof over my head and enough food. In places where the Great Recession has hit harder, such as Greece, it is easy to see why there are protests. When the gravy train ends and it seems you have become powerless to decide your own future, it is easy to be angry. Similar to the first Great Depression, politicians are stoking the flames, blaming the “outsiders”, and doing what drove me to write this article: proposing to close borders.

Is this a major threat to the goal of unlimited healthy lifespans? I would say yes. Not because progress would be stopped, but because it would be (will be?) delayed, perhaps significantly. Every day that passes is another day we grow older without rejuvenation technologies being available. Some non-profit organizations with similar goals as Longecity did note a substantial drop-off in contributions during the crash of 2008. The second Great Depression would make resources more scarce. More people would be working to survive and provide for their families and loved-ones instead of using their spare time to volunteer for loftier future-oriented goals. Again, it seems almost unfathomable that in an era of rapid technological progress and potential greater abundance, that the world could descend into another Depression, but the signs are there.

What can we do? I would like to think that the Longecity model of open collaboration would continue to spread. That the new generations with a new communication platform would be able to overwhelm the calls for trade barriers, travel barriers, and war. But it is not fait acompli. A large portion of the population of the U.S. in the 1920s thought the “world was their oyster”, but it fell apart quite suddenly.

I don't think there are any easy answers, but more openness and transparency seem to help. What do you think? Which trend will win out in the next few years? Can technological progress and the open collaboration across borders win the day? Or do we have to endure a few years of economic depression and war, before regaining our footing toward the future?

Edited by Mind, 22 April 2012 - 02:39 PM.

[Mind]

I know this has political leanings, is poorly referenced, and a bit rambling, but it was on my mind, and I had to get it off my mind.

[cypan]

tl;dr: look into agorism and crypto-anarchism.

Over and over around and around, we play the games with presupposed authority; god-state cults; politics and paranoia. Let's give a bunch of psychopathic killers and thieves armies, pay up tribute, and hope they don't go out of control! That's worked before! Hmph. I used to be a political thinker, you know. "Which combination of policies can solve the problems caused by these other policies?" But you know, after trying to square the circles for so long, I finally realised just how pointless it all is. Since then, I've looked to philosophy where politics have failed.

The way I see it, the means by which we interact with each other every damn day has worked. It works beautifully in our everyday lives. We cooperate and compete in friendly, peaceful ways. We help each other out. We do business with each other. We discuss and collaborate and progress. But then some sadistic psycho killer decides he wants to get back at the world for his own screwed up past, so he puts on a shiny badge, dons a spiffy yet unoriginal uniform, and demands that everyone bend over and take his beatings. And when a generation of people becomes trained to think this jerk is presupposed authority who must never be questioned, and you combine that with the Nazi-reminiscent cultist mentality of being part of the "nation" with all the twisted thoughts of "unity" and "oneness" and "majority" and "democracy", an unstoppable force grows and fosters around obedience and violence and death. And these people have been taught all their lives that this badge-wielding demigod is their saviour; their friend; the deliverer of order and justice in a world with demons lurking around every corner and in every shadow.

... but who is the real demon? Who is the psycho killer they're told is everywhere the badge-wielder is not? Who is the kidnapper? Who is the thief? Who is the rapist? Surely not the man with the gun extorting money out of people on the thread of being abducted and tossed into a cage or, if such abduction is resisted, assaulted and, eventually, killed. Surely not the saint. It's those everyday commoners who behind the masks of our caring, loving neighbours, friends, family, and colleagues are secretly all plotting conspiracies to strike as soon as the great saint is out of sight. Surely we can trust the ones declaring wars, murdering millions, extorting "protection" money, abducting children, assaulting and holding hostage kidnapped victims... surely all these crimes are "necessary evils" to protect us from the the REAL threat; the conspiring demons we're told about in schools run by our benevolent saints.

This may seem like a tangent, but to be frank, I don't sympathise with most people when they complain about depressions and closed borders and massive wars with millions of victims. Not saying you, OP, are one of these people. What I am saying is that most people are baffled by all the violence and destruction and death and misery around them, but their solutions are always to hand over power to a bunch of violent, destructive, murderous sadists and legitimise this as an institutional "saviour". And it *always* leads to atrocities. No empire has grown without falling. No nation-state has existed without rampant theft and assault and war and pain and misery.

So what can we do? You asked that, OP--what can we do? I'll tell you what we can't do. We can't "lobby the government" to hope that we can just fix all this violence and misery with more violence. We also can't lobby mainstream culture since that's just trying to dismantle a powerful cult (and as any psychotherapist would hopefully agree--correct me if I'm wrong, too, since I'm not a trained psychotherapist--cult members who were put through years of deep brainwashing are *very* difficult to get out of their cult).

What we *can* do, however, is stop trying to solve the world's problems politically. We can stop trying to "fix society" and promote "social change". We can start by opening our eyes and seeing what the world really is. There's no "country", "nation", "border", "state", "police". There's earth and water and foliage and sky--and hominid apes like you and me walking around. So once we acknowledge this, we can see that it doesn't matter at all what someone does on the other side of a continent. To consider that individual a "citizen" of an arbitrarily-bordered political sphere is totally illogical. He has nothing to do with you nor you with him. So look around you in your actual social circle. Now ask yourself--how do you interact with your peers? Do you declare world wars and lock down borders and extort money out of them? Would you appreciate them doing so to you? The number one thing I can recommend is DO! Don't just talk. If you want peace, you must live peacefully. If you want freedom, you must live free. To simply talk about "oh these wars and taxes and policies and borders" and fail to actually adopt anything into your own life is as useless as saying "oh these potential cybernetic enhancements and indefinite life extension and diet and exercise" and sit on the couch watching American Idol all day. We can prevent wars by not fighting wars. And for every person who does not fight wars, that's one fewer person potentially escalating wars.

Before I get the reasonable retaliation of "self-defence", I'm a pragmatic non-aggression pacifist. I have adopted the principle which declares that I will not aggress against you for any reason whatsoever. I will defend myself if another aggresses against me, but I will not aggress. I will not ask someone to aggress in my name (e.g. voting in a democracy). And I am also not stupid. I know I stand as a minority with this principle. Thus, I treat this as any survivalist would in a hostile environment. Would a survivalist go over to a leopard and prod the beast with a stick? No, that'd be stupid and self-destructive. So I adopt cryptography, privacy, and stealth. I don't delude myself to think of "the state" watching over everything. "Big Brother" is an illusion. I simply see the other hominids in their perceived territories, and I do my best to not prod the violent sadists among them. I keep records minimal. I don't use their failing financial institutions. I don't participate in their cults. I am not a citizen of any state because I don't accept the terms of service of any state, and I do not recognise involuntary one-sided contracts. Politically, I'd have to defend my stance. Philosophically, I don't have to. It's simple. I won't aggress against others. Therefore, I won't force them into my way of life, I won't send goons to their houses, I won't extort money out of them. Therefore, I won't participate in their cults since that would require me to break this personal rule.

[cypan]

As for how this will affect longevity research, that's one of the scary parts of the widespread madness. A lot of general research is centred on what is sometimes called "Big Science"; funding from extortion done by centralised presupposed authorty institutions. Now, for our particular goal, it might not be so given how community-focused the fundraising efforts of such projects as SENS have been. Proposals for crowdfunding are discussed regularly, and I think that's important. Does ImmInst or SENS Foundation or Methuselah Foundation or someone else doing this research accept donations in bitcoins? As soon as that happens, you can count on me to contribute to the funding. In fact, as I earn money, part of all my profits would be funneled into such research. I support efforts that help people achieve these goals. CRON-O-Meter, for instance, is a valuable tool for the immortalist trying to optimise dietary health. As soon as I saw they accepted bitcoins, I became a Gold subscriber. Same would go to being a member of ImmInst, a funder of SENS, etc. Crowdfunding is important to me, and I am willing, even though I am not rich now, to contribute in that way.

Edited by cypan, 22 April 2012 - 07:29 PM.

[Athanasios]

Everyone is too busy trying to pretend they don't read zerohedge to respond.

[niner]

During the recent bout of paranoia, I was a net seller of precious metals. I am not worried. The countries that are trying to use austerity to get their economies moving are hurting now. The countries that were able to spend are doing better. Keynes was right. People who claim that the Great Depression was extended by government spending are just trying to peddle an ideology. Hell, even Hayek thinks that the Fed's deflationary policy in the thirties was "silly". Bernanke agrees with him as to its causal role.

I'm not that worried about America, unless the delusional GOP gains control. I'm a bit concerned over Europe. The French look like they're going to elect a freaking socialist. In America, the Republicans are still peddling "trickle down", despite a decade long experiment that proved it doesn't work. Now they seem to be doubling down on it, veering ever farther from reality, while the French try careening in the opposite direction toward another thing we know doesn't work.

[Inkstersco]

No. Not a world war. There is not enough true ill will between Western governments for that, not enough shared ideological certainties in Europe around which one could build an army. You spoke about France and Germany and closed borders between them, but that's a trifling factor. Not even a Lepenist French government could precipitate a European war without trying hard to, and the assumption that it would comes from overconfidence in the Hitler Script IMO. There is a sort of populism in Europe which is conducive to civil violence, but not world war in the sense of I and II. Not for a long time, anyway.

[Mind]

Good point about the standing army angle Inkstersco. Europe has much less military presence than a century ago.

Also, I am not sure we need to bring up political labels in the discussion, just some awareness of financial crises that seem plausible and how they will affect Longecity and other life extension efforts. I am worried things could be significantly delayed, but maybe I am over-concerned.

[PWAIN]

Personally I am more concerned about a newly dominant China vs old guard US getting into a stand off. China may not be there yet, but it is not hard to project a future where this is almost inevitable. The US will want to show it is still relevant and China will want to stamp its new authority. How this plays out really is critical to all our futures. I guess we can only selfishly hope that China gets stuck in the middle income trap.

[niner]

China will continue to advance, although they face some serious demographic challenges that could stall things out. America will, I think, muddle through, and perhaps even excel, given our new-found methane wealth and our creative strengths. My biggest worry in the category of 'reasonably plausible' would be a Eurozone financial crack-up and consequent shock to the world economy. Markets the world over tanked today on the heels of the French election results. My biggest worry in the category of 'unlikely but would be really bad if it happened.' is Iran lobbing a crude nuke at Israel and Israel responding by glassing all of Persia. In the event of this particular dark-grey swan, I'll probably wish I'd positioned myself for Armageddon, financially speaking, but again, I think the odds of it are low.

If we're interested in the thing that will really stop all progress, It probably isn't going to be the things we see coming. It will be something out of the blue. A plague of biblical proportions? That's not exactly a thing that nobody's thinking about, but if something really bad came out of nowhere, there would be ugly consequences, like most of us being dead and the few who remain living in a really bad movie staring Jean Claude van Damme.

There's the problem of people believing things that aren't true. That seems to be getting worse instead of better. When enough people believe things that aren't true, and policies are created based on wrong ideas, the outcome can't be very good, and might well be terrible. People used to agree on basic facts, and disagreed on what to do about them. Now we disagree on the basic facts. That to me is a sign that something in our culture has gone horribly wrong. If Rol82 were still around, he would tell us that all these things are cyclical, and rationality will come back around eventually. I hope he's right about that. He probably is, but we could give up a lot of progress while we wait for the pendulum to swing. We are at a unique point in human history where the political and technological events that happen over the next 20 years may determine whether or not a lot of us die "on schedule", or don't...

[The Immortalist]

Even though this seems obvious the most important thing to do no matter what happens is to keep the idea of life extension alive. We must continue on no matter how hopeless it seems. I'm optimistic though because the life extension community is not getting smaller right?

In before Brokenportal comes in and makes another one of his excellent motivational speeches.

[mpe]

Everyone is too busy trying to pretend they don't read zerohedge to respond.

I read zerohedge and unfortunately find I do agree with many of the statements and opinions.
The "banksters" will risk everything you have to keep everything they've got.

And it looks like we're all about to loose.

[mpe]

Pity that everything they've got used to belong to you.

[mpe]

Personally I am more concerned about a newly dominant China vs old guard US getting into a stand off. China may not be there yet, but it is not hard to project a future where this is almost inevitable. The US will want to show it is still relevant and China will want to stamp its new authority. How this plays out really is critical to all our futures. I guess we can only selfishly hope that China gets stuck in the middle income trap.

To be honest, I don't think China is as big a threat to American economic dominance as America itself is.
True a great many western jobs have been lost to China, India etc but really technology will soon displace those jobs with robotics.

Near slave labour pay rates in far off countries and cheap bulk freight will be no match for localized robotized production. The jobs created will not replace the 1950's jobs we've all lost, but employment transfer will end.

The US gained its economic advantage through its enormous ubiquitous market, that hasn't changed and probably never will.

China and India will benefit from similiar market structures , the challenge for them is to employ technology and their enormous workforces before technology leaves them behind.

Economics isn't now and never has been a zero sum game, if it were we would still be in the stone age.
Lamenting the past will not bring it back and really who'd want it!

Unforuntely I think we are heading for, or are already in another depression. Fortunately technology doesn't seem to be slowed by economic slowdowns but rather helped by it as the old and inefficient are swept aside.

Given the choice between economic collapse and prosperity by adopting new technology, people will choose the new technology.

Economic collapse through aging and conventional medicine and last centuries tech and business models or rejuvenation and wealth for all.

Tough choice.

[mpe]

Just don't let the Banksters steal it

Edited by mpe, 25 April 2012 - 10:59 AM.

[PWAIN]

Niner,

I think those demographic challenges are not going to be as big or as damaging as expected and the main hit is going to be delayed. 2 Main demographic challenges come to mind, aging pop and more males than females. The aging population is still 20 to 30 years off of really hitting China and even then, the standard of living of the average elderly Chinese retiree is likely to be much lower than the average Us retiree and even compared to the average young Chinese. Their expectations are less and they are well known for savings. Americans on the other hand have high standards of living, huge medical costs and it's aging population is closer to retirement and their savings habits are relatively poor. The extra males problem is addressed by either putting them to work or putting them to fight...

European attitudes have become very passive and soft and it will take a lot to get them to want to fight again. Europe will only be looking to defend itself in the next couple of decades. Europe will rot away quietly.

Even in the unlikely event that Israel and Iran start lobbing nukes, it will be contained to the region and unlikely to have any effect apart from increasing the price of oil.

As for a future idiocracy, it may well happen but hopefully the process is slow enough that machines will help us get through that.

Essentially we have a path ahead of us that is screaming at us and everyone seems to be ignoring it. At the turn of the previous century, Britain was the world leader with a global empire. It's economy and military was strong. It was arrogant and self assured, It was dynamic and innovative. It was running strong on the industrial revolution. If people at that time had paid attention they would have noticed another rising star - the US. Here was a country that had about five times the population who were dynamic and willing to work for less. They grabbed the manufacturing from Britain and the rest of Europe. They employed the latest technology and built up an internal market. They focused on the economy.

Now we see China with around 5 times the US population, a super dynamic population ready to do the same. China only has to achieve around 20% of the per capita GDP per person of the US to have the same size economy. China is following a well trodden road and it is almost a certainty. The only questions left are how smooth the transition will be? Unfortunately I am not confident it will go smoothly and that WILL have an impact on the global economy. The fact that the average American seems to be oblivious to what is coming just adds to my fear of how they will react when the reality finally hits.

China will continue to advance, although they face some serious demographic challenges that could stall things out. America will, I think, muddle through, and perhaps even excel, given our new-found methane wealth and our creative strengths. My biggest worry in the category of 'reasonably plausible' would be a Eurozone financial crack-up and consequent shock to the world economy. Markets the world over tanked today on the heels of the French election results. My biggest worry in the category of 'unlikely but would be really bad if it happened.' is Iran lobbing a crude nuke at Israel and Israel responding by glassing all of Persia. In the event of this particular dark-grey swan, I'll probably wish I'd positioned myself for Armageddon, financially speaking, but again, I think the odds of it are low.

If we're interested in the thing that will really stop all progress, It probably isn't going to be the things we see coming. It will be something out of the blue. A plague of biblical proportions? That's not exactly a thing that nobody's thinking about, but if something really bad came out of nowhere, there would be ugly consequences, like most of us being dead and the few who remain living in a really bad movie staring Jean Claude van Damme.

There's the problem of people believing things that aren't true. That seems to be getting worse instead of better. When enough people believe things that aren't true, and policies are created based on wrong ideas, the outcome can't be very good, and might well be terrible. People used to agree on basic facts, and disagreed on what to do about them. Now we disagree on the basic facts. That to me is a sign that something in our culture has gone horribly wrong. If Rol82 were still around, he would tell us that all these things are cyclical, and rationality will come back around eventually. I hope he's right about that. He probably is, but we could give up a lot of progress while we wait for the pendulum to swing. We are at a unique point in human history where the political and technological events that happen over the next 20 years may determine whether or not a lot of us die "on schedule", or don't...

[PWAIN]

The idea that the US is a threat to itself and will self implode is my myth than reality. It is a bit like people talking about the youth of today but in truth this has been going on since Plato.

Robotics are already extensively used in manufacturing where they make economic sense. To fill in many of the remaining jobs is going to take time, at least 20 years. In this time, China will be moving up market and into other areas much as countries like Japan have done. Actually the bad state of the global economy is just helping the Chinese to realise that they need to branch out.

I am not suggesting that the US economy will collapse, but loss of the advantages of being the leader will cost it. Losing the global reserve currency status is almost certain and that will not be taken lightly. Without being the owner of the global reserve currency, the US would be in a worse state than Europe right now. Having the reserve currency allowed the US to print huge amounts of money without the inflation and devaluation other currencies would experience. That one thing has brought the US a far milder recession. This hasn't really helped the US because recession is needed to force cleaning out and greater efficiency. This will come back to bite.

Is population is not a key to economic success, how is it that Australia's economy is around a third of the UK (three times the Aus pop) and a fifteenth of the US economy (fifteen time the Aus pop)? GDP per capita is far closer in western nations that GDP per country.

As for depressions, you are probably right but I think far worse may be ahead sometime in the next 20 - 30 years.I am not aware of any major innovations that occurred during the great depression - not saying they didn't happen but wondering if you have any examples?

I just want to say that I think that relying on technology to pull us through may be ill conceived, we may well have picked most of the low hanging fruit and have to wait long periods for new innovations. I'm not talking about a new can opener here, but the sort of stuff that has allowed such rapid acceleration of our standard of living. Processing metals and minerals, structured production, economies of scale etc all have had huge impacts. These advantages have already happened and new developments in these are more incremental than revolutionary. Our rate of innovation and our need for new innovation have to keep up with each other. If we run out of oil, we need electric cars and other systems to take over - if the battery tech is not ready, we get a hiccup and we really feel it. Even if we have the batteries, are they affordable, reliable etc?

The future could be really rosy but there is just as much chance that it will be awful.

Personally I am more concerned about a newly dominant China vs old guard US getting into a stand off. China may not be there yet, but it is not hard to project a future where this is almost inevitable. The US will want to show it is still relevant and China will want to stamp its new authority. How this plays out really is critical to all our futures. I guess we can only selfishly hope that China gets stuck in the middle income trap.

To be honest, I don't think China is as big a threat to American economic dominance as America itself is.
True a great many western jobs have been lost to China, India etc but really technology will soon displace those jobs with robotics.

Near slave labour pay rates in far off countries and cheap bulk freight will be no match for localized robotized production. The jobs created will not replace the 1950's jobs we've all lost, but employment transfer will end.

The US gained its economic advantage through its enormous ubiquitous market, that hasn't changed and probably never will.

China and India will benefit from similiar market structures , the challenge for them is to employ technology and their enormous workforces before technology leaves them behind.

Economics isn't now and never has been a zero sum game, if it were we would still be in the stone age.
Lamenting the past will not bring it back and really who'd want it!

Unforuntely I think we are heading for, or are already in another depression. Fortunately technology doesn't seem to be slowed by economic slowdowns but rather helped by it as the old and inefficient are swept aside.

Given the choice between economic collapse and prosperity by adopting new technology, people will choose the new technology.

Economic collapse through aging and conventional medicine and last centuries tech and business models or rejuvenation and wealth for all.

Tough choice.

[mpe]

Generally speaking, I agree with you Pwain, but no country can be successful if it continuously runs budget deficits of 50% or more of its annual outlays, penalizes its students for seeking higher education by saddleling them with massive debt, allowing corrupt FDA and big Pharma to bankrupt your medical system and then hands trillions of dollars to its major banks with no requirement on them to redress the practices that got them in trouble in the first place.

Ultimately who funds this debacle ? You and every taxpayer in your country, but there lies the biggest kicker, because I'm pretty certain that the tax rate you pay is far higher than hat paid by your countries wealthiest even ignoring tax evasion.

The average American is being taken for a ride and courtesy of the $ reserve currency status so is the rest of the world, for now anyway.

[Mind]

And....there goes Denmark, will re-institute border controls with Germany and Sweden. WTF? Shit is falling apart fast.

[niner]

And....there goes Denmark, will re-institute border controls with Germany and Sweden. WTF? Shit is falling apart fast.

I don't see how this means the world is falling apart. Denmark is no different than America, in that some people there are worried about too many immigrants. This tends to happen when times get tough, or when there is so much immigration that people feel their culture is threatened. It's certainly an issue all over Europe, where one of the big worries is illegal immigrants from non-EU nations. I'm more worried about America's loss of its former ability to fund higher education. When I was in college, my only significant costs were room and board. Today, tuition is out of reach for a lot of people, and student debt is spiraling out of control.

[rwac]

When I was in college, my only significant costs were room and board. Today, tuition is out of reach for a lot of people, and student debt is spiraling out of control.

Yup. Government student loans have made it too easy for universities to raise tuition. Hello student debt bubble.

Also? If this goes national, you might see a big stock market crash.

[niner]

When I was in college, my only significant costs were room and board. Today, tuition is out of reach for a lot of people, and student debt is spiraling out of control.

Yup. Government student loans have made it too easy for universities to raise tuition. Hello student debt bubble.

Also? If this goes national, you might see a big stock market crash.

I know that's the latest spin being proposed on the issue, but tuition at state schools didn't go up much if any in response to the existence of government loans, which are only a part of the student loan market. They mostly went up because strapped states stopped contributing money to their university systems. My education was subsidized by the taxpayers of the Great State of California, but they aren't doing that any more Student loans were available then as well as now. The more exclusive private schools have also raised tuition dramatically, and I suspect the reason for that is the same as the reason there are so many cars that cost between fifty and a hundred grand. Because there is a small but significant population who has a ton of money; the one percenters, or maybe the 2%, and they are not price sensitive.

Taxing 401Ks? That's already national. Conventional IRAs and 401Ks are taxed upon withdrawal. Fox is trying to scare people, as usual ("Democrats want to tax 401Ks"...) I just did my retired in-law's taxes a couple weeks ago, and I was pretty shocked that on their $70K income, their state taxes were exactly zero. Their local taxes were zero and their federal taxes were 6%. WTF? How exactly is that fair, given what you and I are paying? That total tax rate is less than what working people pay in payroll taxes! There are some states, like mine and Illinois, that don't tax retirement income. The elderly are a very wealthy demographic today, and it's not like they aren't using state and local services. I guess that's what happens when you are a demographic that is known for voting.

[capob]

"I know this has political leanings, is poorly referenced, and a bit rambling, but it was on my mind, and I had to get it off my mind."
To do anything, you must have power. To do anything large, you just have large power. And, in a world of governments, politics can direct power; and so, it should be to no one's alarm that, in the aim of something large, immortality, you dabble in politics. I found your post to be very mild, as if you were treading on thin ice. I imagine this might be a result of the contrast between people who are tv zombies and those who, say, read zero hedge - or any of the many other new sources pointing out the non dillusion, undestracting news. That is, in broaching these subjects to tv zombies you are essentially risking your brains.

"What can we do? I would like to think that the Longecity model of open collaboration would continue to spread. That the new generations with a new communication platform would be able to overwhelm the calls for trade barriers, travel barriers, and war. But it is not fait acompli. A large portion of the population of the U.S. in the 1920s thought the “world was their oyster”, but it fell apart quite suddenly."
The issue here is a question of power contests. As cypan noted, there is a futility in petitioning unanswering politicians. From what I have seen, the idea that there would be some overwhelming done by "calls" for anything has no basis in reality. That is to say, while there are no reins, the horses don't care how many people are yelling at them. And, in addition to this, there is a pattern which I have observed that people tend move towards easy simple solutions which have simple reasons and provide significant effects. And, these are the only types of solutions that people tend to act in masses towards. For instance, if you look at just about any type of activism, the masses of activists call for some simple solution that fits this pattern. When the solution becomes complicated or when the reasons become complicated or when the result minor, it is certainly odd to see and large body of people moving towards that solution.

"When the gravy train ends ..."
This is a perspective I have often seen. It is certainly an interesting one. In relation to those on welfare or some other state support, I might agree with the notion. But, if you are talking about the average joe, take the price of gold at around the year 1900 and use that to estimate inflation, and then compare the average wage of the average joe now to then, and you will find a lack of gravy (at least according to my memory). I could go further on about the CPI and various other things in this direction, but I won't

"Which trend will win out in the next few years?"
Back to the power contest idea; the issue is, who has the power, and what do they intend to do with it.

[rwac]

They mostly went up because strapped states stopped contributing money to their university systems.

That's probably true. But the normal response to losing funding is to (partly) cutback on expenses, and increase tuition somewhat. but here, the student is insensitive to tuition, because of the existence of student loans.

Taxing 401Ks? That's already national. Conventional IRAs and 401Ks are taxed upon withdrawal.... The elderly are a very wealthy demographic today, and it's not like they aren't using state and local services. I guess that's what happens when you are a demographic that is known for voting.

You're right here, but there's a lot of money in 401Ks and IRAs. I bet lawmakers will get their hands on it someway eventually. And that will result in people opting out reducing money in the stock market.

[capob]

tl;dr: look into agorism and crypto-anarchism.

Over and over around and around, we play the games with presupposed authority; god-state cults; politics and paranoia. Let's give a bunch of psychopathic killers and thieves armies, pay up tribute, and hope they don't go out of control! That's worked before! Hmph. I used to be a political thinker, you know. "Which combination of policies can solve the problems caused by these other policies?" But you know, after trying to square the circles for so long, I finally realised just how pointless it all is. Since then, I've looked to philosophy where politics have failed.

....

This is, I'm afraid, a common overreaction to the observation of the potential excesses of statism. In reality, agorism fails to address the powerful threats posed by domineering nations under the unity of a government. An article I wrote briefy getting into this is here: http://persistenceso...ceAndGovernment . A second thought on the matter may lead someone towards the idea of minarchism, but, that system, too, has problems:
http://www.ronpaulfo...l=1#post4368667



The main problem, that I can see, is not that all forms/systems of government are abhorrent; rather, all existing forms have large potentials for exploitation of a majority. And, the question becomes, how did these current forms of government come about? Well, for the most part, there are a couple of ways, I imagine: 1. copy paste or otherwise most convenient (fitting the pattern I mentioned in the previous post); 2. Least concession of power (say, from kingship); 3. Consolidation and inclusion in part of part of all the best or most well known current societal ideas. In the case of the US, this is the only modern case of #3 that I know of. And, the best ideas that I've found around regarding government and society seem to have been established over 100 years ago - I could, of course, just be ignorant. It seems as though in the past many years (say, 200 or so), the focus has been on speed and not direction. And, so, you get more efficient, pre-established statist governments which fall in line with the thought that government exploits. What I'm gettng at here is that a system for society that includes government is not doomed to failure - the failure depends on the specifics.

[capob]

PWAIN:

"Even in the unlikely event that Israel and Iran start lobbing nukes, it will be contained to the region and unlikely to have any effect apart from increasing the price of oil. "

Firstly, if you will look into the "~wipe israel off the map" quote which many new services have said Iran's leader said, you will find the new services were either ignorant or deceitful (http://www.mohammadm...of-the-century/). To note, I don't care about Iran, but this has relevance.

Then, there is the issue of an Iranian nuclear program. This idea of nukes has certainly been used in the past as a pretense for invasion when it was clear there was no actual threat.

What I'm getting at here is, the reasons for hostilities between iran, israel, and us are largely fabricated pretexts. So, the question becomes, what is the motive for the US and Israel wanting to engage Iran? Further, if you have good new sources and have paid attention to them in the past couple of years, you'll have noted that the US and Pakistan have had some notable political disturbances; and behind pakistan is, potentially, china. Further, you'll note the various disturbances in Syria and the potential for NATO intervention there, and the potential that Russia will back Syria. And, you might speculate that these things point, when sufficiently coerced, to a war with Israel, US, Various European Countries vs China, Russia, and some minor countries. It is an entertaining idea to have in mind when looking at current events; though I don't suggest investing in a bomb shelter just yet hahaha - I'd rather not be a target of a bomb then be semi bomb proof.

"I am not suggesting that the US economy will collapse, but loss of the advantages of being the leader will cost it. Losing the global reserve currency status is almost certain and that will not be taken lightly"
"This hasn't really helped the US because recession is needed to force cleaning out and greater efficiency"
I do wonder what you would consider a collapse. 6 Years ago, when interviewing people for programming jobs, I noted the severe lack of intelligence that US educated (masters, bachelors CS) candidates had. Certainly, the number of exceptionally smart people is high in the US, but there is clearly a very low baseline. It's been my opinion for a very long time that, for the most part, a lack of intelligence is not a reflection of biological defficiencies, but instead bad diet and bad education. What I'm getting at here, is, you have, in the US, a lack of industry and a service economy combined with a rather dull set of potential employees, and, when you remove the reserve currency status of the dollar, there is nothing that I can see on which the average US joe has left to stand on (ie, collapse). Of course, my opinion of the intelligence of poeple is restricted to what I have seen, so I could be terribly wrong.

"This hasn't really helped the US because recession is needed to force cleaning out and greater efficiency"
I can see how this might be thought, but to my thinking, this thought is wrong. When you search history for the pattern of envirnoment that promotes efficiency and innovation, the pattern is not of dire need. Instead, the pattern is of cool headed, resource excess. When your R&D department has no funds, they tend not to do R&D. When people are stressed, they tend to look for easy solutions; not the best solutions.

[Mind]

When I was in college, my only significant costs were room and board. Today, tuition is out of reach for a lot of people, and student debt is spiraling out of control.

Yup. Government student loans have made it too easy for universities to raise tuition. Hello student debt bubble.

Also? If this goes national, you might see a big stock market crash.

I know that's the latest spin being proposed on the issue, but tuition at state schools didn't go up much if any in response to the existence of government loans, which are only a part of the student loan market. They mostly went up because strapped states stopped contributing money to their university systems. My education was subsidized by the taxpayers of the Great State of California, but they aren't doing that any more Student loans were available then as well as now. The more exclusive private schools have also raised tuition dramatically, and I suspect the reason for that is the same as the reason there are so many cars that cost between fifty and a hundred grand. Because there is a small but significant population who has a ton of money; the one percenters, or maybe the 2%, and they are not price sensitive.

Taxing 401Ks? That's already national. Conventional IRAs and 401Ks are taxed upon withdrawal. Fox is trying to scare people, as usual ("Democrats want to tax 401Ks"...) I just did my retired in-law's taxes a couple weeks ago, and I was pretty shocked that on their $70K income, their state taxes were exactly zero. Their local taxes were zero and their federal taxes were 6%. WTF? How exactly is that fair, given what you and I are paying? That total tax rate is less than what working people pay in payroll taxes! There are some states, like mine and Illinois, that don't tax retirement income. The elderly are a very wealthy demographic today, and it's not like they aren't using state and local services. I guess that's what happens when you are a demographic that is known for voting.

Niner, can't you see it? Almost everything the government subsidizes spirals out of control. Housing? Medical costs? Higher education? I can't believe you are oblivious to the warped incentives. I refuse to believe it. When people don't think they are paying for something out of pocket, they spend more freely and irresponsibly.

[niner]

When I was in college, my only significant costs were room and board. Today, tuition is out of reach for a lot of people, and student debt is spiraling out of control.

Yup. Government student loans have made it too easy for universities to raise tuition. Hello student debt bubble.

Also? If this goes national, you might see a big stock market crash.

I know that's the latest spin being proposed on the issue, but tuition at state schools didn't go up much if any in response to the existence of government loans, which are only a part of the student loan market. They mostly went up because strapped states stopped contributing money to their university systems. My education was subsidized by the taxpayers of the Great State of California, but they aren't doing that any more Student loans were available then as well as now. The more exclusive private schools have also raised tuition dramatically, and I suspect the reason for that is the same as the reason there are so many cars that cost between fifty and a hundred grand. Because there is a small but significant population who has a ton of money; the one percenters, or maybe the 2%, and they are not price sensitive.

Taxing 401Ks? That's already national. Conventional IRAs and 401Ks are taxed upon withdrawal. Fox is trying to scare people, as usual ("Democrats want to tax 401Ks"...) I just did my retired in-law's taxes a couple weeks ago, and I was pretty shocked that on their $70K income, their state taxes were exactly zero. Their local taxes were zero and their federal taxes were 6%. WTF? How exactly is that fair, given what you and I are paying? That total tax rate is less than what working people pay in payroll taxes! There are some states, like mine and Illinois, that don't tax retirement income. The elderly are a very wealthy demographic today, and it's not like they aren't using state and local services. I guess that's what happens when you are a demographic that is known for voting.

Niner, can't you see it? Almost everything the government subsidizes spirals out of control. Housing? Medical costs? Higher education? I can't believe you are oblivious to the warped incentives. I refuse to believe it. When people don't think they are paying for something out of pocket, they spend more freely and irresponsibly.

Wait a minute. Housing went up for a lot of reasons, like artificially low interest rates and people's belief that real estate would continue to go up indefinitely. Medical costs have gone up for a whole lot of reasons, of which government subsidy is a minor player. A lot of doctors won't even take Medicare patients. What does that tell us about the role of government subsidy? A much larger reason there is the total lack of price signals due to the fact that we use insurance to pay for everything, and health care providers are totally opaque about costs. I just paid cash up front for a heart scan last friday, and I think it might be the first time in my life I've ever had that kind of payment experience for a medical test.

As for higher education, where is the evidence that subsidized loans have caused tuition to soar? If you look at the data, I just don't think you'll find it. It's a very ideological argument, very much like the one that tried to claim that the financial crisis was caused by the Community Reinvest Act. That argument was not only utterly wrong, but was morally wrong as well because it pointed the finger in the wrong direction while protecting the real miscreants. I'll bet it's the exact same crowd that's trying to blame the rise in tuition on subsidized loans.

I'll grant that there is one educational sector that has gorged itself at the public trough- the for-profit college industry. The lies and predatory behavior by some of them is disgusting. However, that is quite separate from what's happened in the traditional college sector.

When I went to college, the tuition was almost entirely subsidized by my state. Today it isn't significantly subsidized, so the cost to the student is wildly higher. Yet demand for seats at the UC is higher than ever. How can this square with the idea that subsidized loans caused the increase? We've been told for a generation that you'd better get a college education or you'll wind up living under a freeway bridge. The demand is huge, even though the price signals are staring everyone in the face. If there were no subsidized loans at all, I suspect that the UC would still be turning students away at the better campuses. The only change would be the economic strata of the student body, who would skew wealthier.

[Brainbox]

And....there goes Denmark, will re-institute border controls with Germany and Sweden. WTF? Shit is falling apart fast.

This is not as bad as it seems imo. Most EU countries already perform a similar level of control of border traffic. I suppose hyping this development is of political nature; it is intended to manage far right populist voices. On the other hand, the rise of right wing and left wing populist parties is indeed a thread to the further development and continuation of the EU. This is a multi-facet issue that cannot be simplified by just looking at border controls, national debt issues or crime level alone.

I think the major problem is that the "us and them" paradigm is still very strongly present in a lot of people's minds. It is a major aspect of our cultural inheritance that had it's uses in the past, but lost some of it's effectiveness lately. I've always been a big fan of the multi cultural approach since this is the only way to proceed towards a world where the economic disaster called "warfare" is no longer of primary concern. The question to ask is how to implement it. It is probably pushed to hard through people's throats. The political elite made some miscalculations. Economical, religious and cultural differences just seem to big to try to realize a multi cultural society as a "blitz" development. Big parts of the population are just not able to cope with it at this fast pace.

As an example to illustrate:
To cope with the economical differences, an experiment was started to try to level the economical differences between the north and the south of Europe by trying to fuel less developed regions with financial injections. As I see it, simplified expressed in "old" left and right wing economical paradigms, as a kind of synergistic cooperation of Keynesian and Friedman models. Bottom-feed economies with financial injections (keynes approach) that are not financed by taxes but by commercial loans that are provided by banks (free market aka Friedman). It did not work out very well however. First of all, to create a sound business model for banks, they were allowed to take high risks at financial markets. Secondly, bottom feeding the "lazy" economies did not strengthen these economies themselves, but in majority only created demands that were satisfied by industries from the already stronger economies. Disaster scenario extra ordinair. We all know what happened. Economical growth did not develop as expected, returns were delayed beyond the point were it was economically manageable.
Apart from these inter-regional developments, there also were similar local developments, e.g. housing market problems. The current real estate market situation in the Netherlands is quite similar to the US, although the backgrounds are different. But also here the point is the experiment to bottom feed a market to create enhanced economical activities that were supposed to create sufficient growth to create a net profit for banks that provided loans.

At the end, after this experiment did fail, the taxpayer had to pull out the wallet to pay for it anyway. Kind of delayed Keynes consequence; the old economical paradigms are still very alive!!

Et voila, high octane fuel is provided for the development of radical very conservative right wing movements.

So yes, I'm not very optimistic about the possibility to realize a good functioning multi cultural society in the very near future. But I'm not very pessimistic in the sense that the next world war seems to be at our doorstep. There is sufficient intrinsic wisdom and brainpower in our political systems, provided that the political parties in the centre of the political playing field recognize the severity of the latest developments and adjust their strategies accordingly. It's not possible to go on as if nothing did happen, we need to be very creative in trying to manage the current polarization.

Edited by Brainbox, 29 April 2012 - 02:12 PM.

[rwac]

A much larger reason there is the total lack of price signals due to the fact that we use insurance to pay for everything, and health care providers are totally opaque about costs.

And this is caused by ... drumroll ... government subsidies for employer based health insurance.

When I went to college, the tuition was almost entirely subsidized by my state. Today it isn't significantly subsidized, so the cost to the student is wildly higher. Yet demand for seats at the UC is higher than ever. How can this square with the idea that subsidized loans caused the increase? We've been told for a generation that you'd better get a college education or you'll wind up living under a freeway bridge. The demand is huge, even though the price signals are staring everyone in the face. If there were no subsidized loans at all, I suspect that the UC would still be turning students away at the better campuses. The only change would be the economic strata of the student body, who would skew wealthier.

That might be true for the UC. But there aren't enough wealthier students to fill all the universities out there!
Perhaps we should also make student loans easier discharge in bankruptcy ...