Wednesday, November 16, 2011

The Governments of the World

So, it has been brought to my attention that a lot of people don't really know what the different kinds of government represent.

The thing about governmental bodies is they're actually rather similar. Communism, Republics, Monarchies, and all the rest: Despite all the rhetoric about vast gulfs of understanding (not to mention all of the wars fought over those differences), governmental types themselves actually vary very little from one another.

Which is only logical, because, in the end, they all serve basically the same purpose: to provide for communal defense, to ensure order, and to gather certain resources to guard the community against emergencies.

Modern society would probably also add to that the providing of certain resources and infrastructure that are deemed necessary for modern life – ie roads, electricity, education, and the like.

And, well, since they all serve a similar purpose, it is only natural that they would share a similar structure.

Beyond all the philosophy and rhetoric and ceremony, there is – really – only one thing that distinguishes one government style from another in any meaningful way. And that is: who gets the vote.

In other words, who it is that gets to make the decisions about how that society lives, endures, and is governed.

So, here's a quick run-down of the various kinds of government, and their take on that one major difference:

Democracy: rule by the Commons
Republic: rule by an elected Elite who are chosen by the Commons
Monarchy: rule by an inherited Aristocracy
Oligarchy: rule by the wealthiest Merchant Families
Theocracy: rule by the most important Religious Figures
Fascism: rule by Militants (note: NOT the Military, more like vigilantes)
Soviet Communism: rule by Bureaucrats
Socialism: rule by the Worker
Dictatorship: rule by One Man
Confederation: a voluntary council of multiple Leaders
Technocracy: rule by Scientists         
Demarchy: rule by Lottery Winner
Anarchy: no rule

Now then, when you study the various governmental bodies, you will notice that a particular style of government will tend to produce a particular kind of law. And that is only natural, since a certain class of rulers will tend to produce a certain kind of law – an aristocracy isn't likely to begin divesting power onto the serfs, for instance.

But the kind of government actually has nothing inherently to do with the kind of laws which are implemented, nor the ones that are enforced, nor the kind of economy that gets implemented, nor the kind of court system that gets organized, nor – most of all – the kinds of social structures that people under that rule form with each other.

However, all of those things are related. A society with certain social structures will tend to form certain kinds of governments. Ie, a society based around the Rule of Law will trend towards Democracy, because the values of both systems mesh well together. But neither of those inherently develops the other. They just work well together, and because they work well together, they are often found together. However, they work well with other systems, too.

For instance – The Rule of Law works just as well with Technocracies. Perhaps even better.

On the other side of things, the Rule of Law doesn't work so well with Monarchy – a society where the law is defined on the moment by the aristocracy, meaning their word is law, not the law on the books – so Monarchy and the Rule of Law are not often seen together. Or at least not for long (not long in terms of history, anyways). But, they are not by any means mutually exclusive.

Society, you see, is a mess of several structures that are spun together to form the society that people live under. The government, then, is (for the most part) the system of rules through which the rulers rule. And that is why the different governmental styles, when looked at from a distance, seem so similar. Their differences are not in their structures, but instead is merely in their arrangement of that structure.

So why, then, the recent big dispute between Democracy and Soviet Communism? Why, when the difference is only between rule by a selected Elite (most of today's 'Democracies' actually being Republics, of course) and rule by Bureaucrats?

Well, the actual dispute wasn't between governmental styles, but between economic systems, because communism isn't just a governmental style, it's also a series of economic theories. And the dispute was between Capitalist theory and Soviet Communist theory. An economic system controlled by a corporate elite and a system controlled by bureaucrats (Soviet Communism being a system where all power was concentrated in the hands of the bureaucrats).

And, if you really want to get down to it, the dispute wasn't really about that either. Capitalism was never against anything called Communism, as its long-running deals with China show.

The dispute was over who was going to control the world's resources in the post World War II world, what with Europe in retreat from its imperial holdings – the Old World interests, their New Money offspring, or these jumped-up bureaucrats. Worse, these bureaucrats kept mouthing off about worker-rule. Even if they never forged a system with any real intent of making that happen, that kind of talk was rather a thorn in the side of the Capitalist system.

Then there's the recent dispute over Fascism, and the whole question of whether it is a Right or a Left institution?

Fascism's philosophies were actually taken from both Right and Left. Fascism is more complex than a simple Right/Left system can represent. If you absolutely must put it on such a binary graph, it leans slightly more to the right than the left – with its love of militarism, tradition, and order. But it isn't really a rightwards organization.

To really plot Fascism, you have to step beyond the single-dimensional Right/Left, Liberty/Order simplicity. Simplicity may be easy to understand, but it is often lacking in accuracy.

If you were to draw a vertical line onto the horizontal Liberty/Order line, and attach the term Progressive to the top, and Populist on the bottom, then you will be able to get much more meaning from plotting Fascism onto a grid.

Fascism doesn't really care about Liberty or Order, so it plots flat on the right/left line, but trending rightwards. Instead, what Fascism is most concerned with is Elitism. Elitism of person, and of idea, and of race. So it plots to the top of the up/down Progressive/Populist line.

And if you want to get really accurate, you'll add the Z-axis into the mix, and attach Individualist and Community to that Z-line. Picturing such a 3-dimensional system isn't so easy for everyone though. But if you do add the Z, then you can plot Fascism well into the community side, since Fascism is all about sacrifice and giving over your identity to the state (and usually eventually the Empire). Thus making Fascism an upwards and backwards movements, but not a rightwards or leftwards. (Though trending rightwards towards conservatism and Order).

On top of all this, there are a few other terms thrown around about governmental styles. But these are usually just flavors of the terms above – a specification of type rather than category. Tyranny is a type of Dictatorship (or occasionally of Oligarchy or Monarchy) where the absolute rule of the dictator is unwanted and cruel – ie, Saudi Arabia. Benevolency is a type of Dictatorship that treats its people well, and is thus often well-liked by its people.

Social Democracy is a type of Republic that strives for a society without extremes of wealth, power, or privilege. Fundamentalist is a type of Theocracy ruled by the extreme Traditionalists. The Garrison State is a theoretical rule by a military that isn't also an aristocracy or a dictatorship (theoretical because it's never been attempted).

Etc. Etc.

And those are the government styles under which we all live.

Some points that might be worth pondering: Democracy hasn't really been tried since the time of the Ancient Greeks. A Federation is the same as a Confederation, except membership isn't voluntary. Marxism has never really been tried – outside of the occasional commune. Oligarchy has been tried many times, but rarely successfully. Empire and Dictatorship go incredibly well together. Yes, Demarchy really exists, and has been attempted (no politicians!), but success is even more minimal than Oligarchy. Parliamentary systems allow each group a portion of the seats on the governmental body equal to the percentage of the vote the capture, instead of Winner-Takes-All, which allows for rapid changeovers of the government even under a Republic. The US is Federation, not a Confederation.

Sunday, October 2, 2011

Suddenly, America Can't Win Its Wars?


War

I find it curious that so many in the media are shocked – shocked – to discover that the United States can't win two little wars against Third World countries. Shocked to the core.

I mean – why? Why so shocked? Really?

And their only explanation for this tragic state of affairs is that it must mean that "America is in Decline!" To these members of the media, it is just one more bit of evidence in the accumulating case against America.

But, really, since when has the US won its wars?

Why, even still now within living memory, there was Vietnam, and Korea, and that failed quo in Cuba, and Cambodia, and Kosovo. But we can back even before that, because America's war record has always been poor, all the way back to the ill-fated invasion of Canada in 1812.

Which isn't to say there haven't been some wins. The conquering of the Phillippines, for one. The Kuwait War for another. World War II: Pacific Theatre for a third. But, overall, there has always been more losses than wins, even against Third World countries.

What I find even more interesting, though, is back in the previous century, when the US lost in both Korea and Vietnam, the common consensus was that people were proud that the US had lost – they wanted the troops OUT of those countries. The failure of those wars was seen as a victory, not as a sudden loss of power.

Korea and Vietnam also were both wars filled with military error and hubris-inspired disasters. Most major battles were won, but they were often ugly wins. Near to being Pyrrhic victories. Stragically, poor decisions were often implemented (whether at political behest or not), such as the invasion of China during the Korean War. All in all, they were filled with military blunders.

These two new wars – although they are filled with a great deal of sleaze and savagery on America's part, same as those previous wars – were militarily very well-executed. So, how it, then, that America's army is somehow in decline? It's fighting much better than it did even 30 years ago.

Equipment handed out to a lot of regular soldiers was of low or non-existent quality, sure. But that was a choice made to put most of the available military funds into Special Forces and research. And just take a quick glance at the amount spent on mercenaries. If the Pentagon chose to spend that on regular troops, they could all be outfitted in tip-top gear. Or, for that matter, cancel a single stealth bomber, and use that to outfit the troops.

Priorities, you see, are other.

But that's actually beside the point. The military fought well in these latest wars. And won the fighting. So, how is that a decline of the military?

It isn't.

Instead, it's the politics of the situation that the US is losing. The politicians and diplomats haven't been able to capitalize on the military's victories. Which is a pretty regular result when you send the military in to do a quick but dirty job, and then have no plan for what to do with the politics of what the military has just given you. Which America didn't.

Then there's the whole question of not having enough troops. Again, though, that is a choice. The military stated – from the very beginning – that it didn't have enough troops for what the politicians were asking. And the politicians fired anyone who said it.

So, we don't currently have enough troops to go around, but, again, that is a political choice. The politicians could have put out a call for soldiers – people were ready to volunteer in droves. When they didn't ask, and the volunteer impetus faded, the politicians could have instituted a draft. But politically, they didn't want to do that either.

So, we have plenty of money and not enough troops. So, we have the mercenaries. It was pretty much inevitable, once those earlier political choices were made.

And finally, the question of how is it that America – with its hugely expensive army – can't beat up on a couple of Third World countries, and put an end to all this resistance and uprising? Surely, that must be a sign of decline, right?

But once again, the military did win. After that, you either have to – as the military recommended – (a) go in with heavy forces and secure the area, or (b) you have to use terror in order to control a larger group with a much smaller force (ie, the manner in which Saddam Hussein ruled Iraq amidst hostile and much larger tribes than his own).

But, once again, politics interfered. The politicians decided it would be best to do neither, to instead simply cross their fingers and trust that God would make it all turn out right, since He was on America's side.

So, instead, the US ended up with this half-assed in between system going seemingly nowhere. And thus you end up with Abu Graib. Abu Graib and all of the other Inquisition chambers like it.

The US military hasn't shown any signs of decline, and thus its military cannot be taken as one of the signs of America's decline.

So, then, where is the source of all this unrest coming from, if it's not because of the endless wars?

It comes from a general malaise, mostly originating from the Middle Class. A lot of bubbles have been burst. The bubble of the shining light on the hill – the country that everyone adored. The bubble of America's omnipotence (the US military is good, but not omnipotent). The belief in America's divine business and monetary sense. The tech bubble. The various loan bubbles. The looming insurance bubbles.

None of these were ever true. They were beliefs. Bubbly beliefs.

And when a bubble bursts, when an illusion gets torn down, a feeling of malaise often settles in on the people who held the illusion.

And a lot of bubbles burst all at once in America, spreading a great deal of malaise around.
           

Monday, September 19, 2011

LEADERS

In the near future, humanity has developed a slightly more rigid caste system than it has today.

A boy from the top caste is about to graduate from elementary school, but he makes a terrible mistake on the ball field, and the other children ridicule him for it. It prideful fashion, the boy plans an over-elaborate revenge for these slights. However this boy has, in current terminology – the guts to make this vision a reality. That is, if he can find the right kids to make his plan work, and they can all avoid getting caught….


Read "Leaders" in Infinite Horizons for FREE
at RPGNow.

An Analysis of the Current Trends in SF

Science Fiction: the stories of speculation. 
 
Terms tend to change over time, particularly in a genre so undefined as is Science Fiction. So, to make sure we are on the same page, we'll go through a quick definition check. Back when I was studying, Science Fiction was divided into three large categories of kinds of stories – Futurism, Science Fantasy, and Space Opera. (Not so long before that, Fantasy was still considered a category of Science Fiction, actually. But that's an interesting fact that's really beside the point.) 

Those three are fairly broad categories that aren't used all that much outside of literary discussions, so most people outside of literary circles won't have heard of them, particularly since at least one of those categories is now dead. But, what did they mean? The idea of Futurism is (or possibly was) the concept of taking a few issues from the modern day, projecting those issues a little into the future, and imagining what the future would be like if we continue down the path that those issues represent, or at least what they represent to the author. More often than not, these were 'Warning Tales' – an alarm cry for a fearful future. Prime exemplar of them: George Orwell's 1984

But, Futurism has been dead for so long now that an entire generation has grown up in a post-Futurism world. Which is an issue we'll come back to...
 
Read the full article in Infinite Horizons for FREE at RPGNow.

Saturday, September 3, 2011

Is American Culture Getting Dumber?


Even when the above question is asked, it's often taken as a given that the answer is: "yes," and then the speaker argues not 'if' but 'why.'

On the other hand, "yes" is demonstrably true. Movies, newspapers, magazines, books, television shows – all their material are shorter, louder, simpler, cruder, and, most of all, plainer. From the news using the term "bad guys" instead of "perpetrators," to the removal of the ability to have a character lie sometimes but not others, to the enforced reduction of rather multi-faceted issues to simple dualities of us vs them. And that's just SOME of the stuff you can find in the new production manuals (yes, the manuals exist, I own one) that everyone now has to follow.

However, those new rules are a conscious result of choices made by the money behind the content, and so it is not at all reflective of the broader culture outside of entertainment – a culture which, though it is certainly affected by entertainment, is still largely the same as it has always been.

But back to entertainment. The content that is available now is assembled to a 5th-grade education, most of it. That's no secret – it's the main pitch of the suits behind the content. There are entire books you can read about the philosophy behind that, with 5th grade being their stated desired content level.

Yet, I would argue that this dumbing down is a side-effect of the choices that have been made, instead of, as I usually hear assumed, a purposeful intent on the parts of the suits.

Having watched a lot of old movies in my time, I can honestly tell you that a lot of dumb movies were produced from the beginnings of the industry right up to today. I mean, really, really dumb.

The difference from then unto today is variety, or rather the lack thereof now. In the past, entertainment was pitched in many different genres to many different groups of people. But now, today, that once great diversity has been reduced to only a handful of genres that are pitched to everybody.

Racing, westerns, noir, screwball comedies, invention, adventure, farce, satire, intrigue – that's just some of the movie genres that have been ended in recent years. Just some. 

Which has left the industry producing very few genres.

To illustrate with something that is even more stunningly visible, and that doesn't involve going over a hundred years of entertainment - let's take a look at video games. In an industry only thirty years old, the ending of genres is markedly visible. Here is a list of the genres that were once produced:

SIMULATIONS
Military Vehicle (Plane, Tank, Submarine)
Military Fleet
Flight
Space-Jet
Life-Sim
Business
Sport

BOARD GAME-STYLE
Grand Strategy
Empire Builder
4X
Turn-Based Tactical
Turn-Based RPG
Classic Board Games

ACTION
Platformer
Clickies (sometimes called Action RPG)
Real-time Strategy
Real-Time Tactical
Light Gun
Rail Shooter
1x1 Fighting
Beat-M-Up
3rd Person Shooter

COMBAT SIM
Tactical Shooter
Historical Shooter
Sci-Fi Run-n-Gun

PUZZLES
Puzzler
Who-Done-It
(the terribly named) Adventure
Physics-Based
Interactive Fiction
Environmental

PARTY
Rhythm
Trivia
Social

Today, what do you have?

SIMULATIONS
Life-Sim
Business
Sport

BOARD GAME-STYLE
4X (rare)
Classic Board Games

ACTION
Clickies (rare)
Real-time Strategy (rare)
1x1 Fighting (rare)
3rd Person Shooter

COMBAT SIM
Sci-Fi Run-n-Gun (what about Call of Duty, et all? – hah, if you regenerate health and/or have infinite ammo in even one gun, that's Sci-Fi no matter what the setting pretends to be)

PUZZLES
Physics-Based (rare)

PARTY
Rhythm

And added to those, one single new genre:

NETWORKING
MMORPG

So, instead of a dumbing down of the games that are available, what has happened is that most of the "smart" genres have been stripped from development, leaving only the dumb styles of games. You can see it quite clearly in the lists above.

This has been a larger trend across all fields of entertainment. The variety has been greatly reduced, and only the most popular genres are developed for now, with anything "intelligent" long since cut out, along with many other genres. Not suddenly, but one by one, the other genres lost their backing.

It's not a secret, either. It was a conscious, often-told business decision. The proponents of this theory have the idea that it is easier and more cost-effective to do what is most popular, and then include elements that those who like the less popular genres like in order to bring them into liking the more popular style. ie, producing an Action movie with Noir-ish elements in order to attempt to make a movie for action fans that also appeals to Noir fans.

And it was quite a successful theory, too. At first. When only a few companies were doing it.

But in the way of modern business, every businessperson reads the exact same book, and now every single company is following the exact same theory. So, now every games company is making First Person Shooters, because there's big money in selling that genre. Which, when you look at that from a broader perspective, means that every single games company is chasing the money of the FPS fan crowd, but no one's chasing the money of the Grand Strategy crowd.

And THAT has the broader effect of reducing the amount of money available to the indistry, since they have effectively excluded the money of sections of the populace by excluding their genres from development, while at the same time putting every company in competition for the exact same dollars of the FPS fans. The exact same dollars, because FPS fans don't have a limitless supply of money or time, so they're just not going to be able to consume all of the FPS games currently being produced for them. Which means the money from the FPS fans will be dispersed over many games, instead of a few, reducing the profitability of all FPS games, while also guaranteeing that a large number of them will fail.

And thus, too, you have sequel-it-is – a way of trying to bring back the guarantee of big money returns.

Yes, the potential returns on an FPS are larger. But that's POTENTIAL. If you eliminate a number of customers by stopping production of games for them (and you'll only get a small portion of them back with simple gimmicks from their favored genres added to the popular genres), you reduce the overall money entering into the field, and with a smaller pool of money to draw from, the industry has to shrink.

The suits somehow seem to have forgotten the old capitalist idea of trying to milk every dollar you can from every member of the populace you can find, and replaced it with the idea that you should milk only the popular and the easy.

How very High School.

P.S. If I were truly cynical, I might wonder why the only two main genres of games left are Combats Sims and Domestic Sims – as if they were trying to forcibly groom men for life as a soldier and women for life in the home. Hm.

Tuesday, July 19, 2011

STATISTICS AND THE LIFE EXPECTANCY OF ANCIENT PEOPLES


Statistics. It's math. It's detail work. It's hard stuff for most people to conceptualize.

Which is where the issues with Life Expectancy statistics start to come in. The trouble occurs because, when studying ancient peoples – say, Rome, with a Life Expectancy of about 30 – so many people assume that that means Roman people lived to be about thirty, and then died.

However, Life Expectancy and Life Span are NOT the same thing.

Life Expectancy is a measure of the average Life Span of a particular people at a given point in time. Life Span is a measure of how many years those people in that place at that time might expect to live.

Still don't see a difference in those two things? Well, let's illustrate.

Say there is a group of ten people on an island, and all of these ten people live to be 100. The Life Expectancy and Life Span of these people is then the same – 100 years. Why? Because Life Expectancy being an average, you add up the ages of your group and divide by the number of people (100x10/10). Life Span, on the other hand, is instead an estimate of how long a person will live based on the experiences of their generation and previous generations (which, in this case, is 100). Thus, in both cases, 100.

But, what if instead one of those 10 were to only live to 90 years? Then Life Expectancy on the island would have dropped to 99 ((100x9+90)/10). But Life Span would still be 100, because 100 is still what by far most people on that island live to be, and thus 100 is still the age that people would expect to live to.

But what if, instead, one of those 10 happened to die in infancy? Life Expectancy just dropped to 90 ((100x9+0)/10). But Life Span is STILL 100. Most people still live to be 100, even though Life Expectancy has dropped by 10 years!

Those numbers are important for several reasons. Firstly, examine how much one infant death affected Life Expectancy. In fact, nine of our ten people could live only to 90, and it wouldn't change Life Expectancy as much as does having one person die in infancy.

This is one of the tricky things about statistics, particularly averaging statistics. Large discrepancies carry much greater weight upon the total than small deviations do.

Now, let's take that lesson back to the Ancient Roman times. Romans did NOT expect to die at about age 30. However, Ancient Rome had a terrible infant mortality rate, which has the effect of greatly dragging down their Life Expectancy average. But if a Roman managed to survive past childhood, they could expect a fairly long Life Span. Indeed, Romans didn't even reach their majority (full adulthood under their law) until aged 30.

So, what was the Life Span of Ancient Rome? It greatly depended on the social status of the Roman in question (that is still a large factor in Life Span today, but the discrepancy was MUCH greater in Roman times). A poor Roman who survived childhood could generally expect to live into their early fifties, in the same way that we expect to live to be 70 today.

A wealthy Roman, on the other hand, had a much longer Life Span, and many a Roman emperor lived well past their 70th year, and there are reports of Romans living into their 80s, 90s, and even (though rarely, and far less well documented) into their centuries. Which makes sense. Modern medicine hasn't increased humanity's Life Span that much; it has instead increased the likelihood of people living a long Life Span.

In other words, there is a lot less infant mortality these days, and modern medicine (but mostly modern health practices) have made it more likely besides that a person will live a long life.

And why is this important?

Well, for accuracy's sake – no more 'historical' talk of Romans (et al) dying at 30.

But also, this is a perfect illustration of how statistics can be misleading. (Or, more importantly, how they can even be MADE to be misleading.) Statistics without context are meaningless. Statistics without proper context are cons.

Monday, July 4, 2011

Why Is War So Expensive?


The short answer is: it isn't, actually.

Or more precisely, it doesn't have to be. 

Yes, the US is spending trillions of dollars to fight two just spot wars and sponsor three raids, which is a hideously big bill for nothing even remotely approaching total war. But look at it from the other side – the Taliban aren't spending anywhere near that amount of money. They don't even HAVE that kind of money. They don't even have a thousandth of that kind of money. 

So, it is definitely possible to fight wars a lot cheaper. They're doing it right now.

Which then alters the question slightly - why are these wars so expensive for the US?

Well, the reasons are many. But first and foremost is equipment. Battleships, supply ships, jet fighters, tanks and hummers all use shocking amounts of (expensive) fuel, and these are wars fought half a world a way, meaning the expense of just getting that equipment to the battlefield, much less to then fight any battles, is astronomical. 

Then there's the equipment itself – billion dollar stealth jets, billions dollar destroyers, multi-million dollar drones, million dollar vehicles. Each of those vehicles brought into use in is a huge price tag, and with needed repairs and service people and equipment and transport for those repairs adding exponentially to the cost of each one in the field.

But added to all that is the cost of firing the weapons on those vehicles. US main battle tanks are a little behind the curve technologically, and the gun mounted on the Abrams is smaller than the European standard and isn't heavy enough to pierce European armor. But the US isn't ready to upgrade its main battle tanks, yet, so, in order to keep up, several years ago the US started adding depleted uranium to their rounds in order to give them an extra explosive kick. The kick was meant to level the technological and power gap. But the kick turned out not to be as great as expected or promised. However, it does help, and it's what the US has, and so that is the round currently being used.

More importantly for this discussion, though, depleted uranium is expensive, and adds hugely to the cost of every round fired – tens of thousands of dollars go up in smoke each and every time a round is fired.

Only, the US isn't fighting European modern armor, and so doesn't actually need that extra kick right now. In the current battles, the US is facing mostly WWII era armor, if they face any armor at all - which is uncommon. Thus, the old caliber, uranium-less round would be equally as effective against the tanks that it is facing while costing a whole lot less.

But, why is the US in these wars with major forces of armor and humvees anyway, particularly Afghanistan? Sharp, rocky terrain with few roads, and most of those roads broken, is far from ideal vehicular terrain. That is terrain for – shocking though it might be for gung-ho, techno America – horses. (Which is why horses was what the CIA and Special Forces used during the initial raids.) Not only do horses have much more (needed) mobility in that kind of terrain, it tends to avoid that whole IED problem.

On top of that, IEDs are a kind of mine. The US uses mines. But US mines are much more expensive than an IED.The US could be using much less expensive mines.

Then there's the big price tags. Every drone that is taken out costs the US between 4 and 10 million dollars, and the US army admits that a third of their drones have crashed. (Not to mention the $26 hack that allowed the enemy to – at the very least – view the drones' video feeds.) All that cost when a much less costly armed insurgent team is far more accurate and far better diplomatically when sent on these kill/capture missions, and actually keeps the mission kill/capture instead of just kill. And all that when diplomacy and old-fashioned policework are far more effective, stabilizing, even better diplomatically, and even cheaper still than both those options, though perhaps less satisfying.

And on top of all that, then there's buildings. Every plane needs an airport. Every airport needs infrastructure. Every piece of infrastructure requires peopleand material to maintain it. The cost to run those drones is thus a lot more than their starting multi-million dollar price tag.

And then, capping it all, there are the massive palace-style embassies built in these warzones. It would be far less expensive and far more palatable diplomatically to build old style non-permanent perimeter camps outside of the cities, instead of building palatial permanent structures upon the sites of the old ruined palaces of the deposed dictators. Better image and better cost.

So, why is war so expensive? You might also ask - why use a plane when a soldier will do far better? Why use a mine when an IED would do? Why use depleted uranium when an unmodified round would do?

Because of money, pride, jobs for the boys back in the home state, money, testosterone, politics over strategy, devotion to technology, over-pricing, and money.

Monday, May 30, 2011

Don't Indians deserve good jobs?


Whenever the merits and flaws of globalization are put up for debate, one of the more recent arguments (technically) for globalization is: "'Don't the Indians deserve good jobs?'"

This is such a PERFECT statement. In a political sense, not a scientific one.

Because, you see, it nicely side-steps the discussion at hand while insinuating racism upon anyone trying to argue against it without being so gauche as to state such an accusation openly. All that, while at the same time being a perfect example of a trap-question – along the lines of 'Have you stopped beating your wife?'

That is a wonderful manipulation of the debate, ending all discussion of the actual matter at hand while side-lining the conversation to an issue that you control – the perfect representation of politico speech.

Well, the question has been asked. So, let's answer it.

Don't Indians deserve good jobs?

Firstly, that implies – without any supplied evidence – that the jobs in question are good jobs. So, let's actually look at the evidence. The technical jobs being shipped over to India do, indeed, pay a decent-ish wage for non-strenuous office-work during normal daylight working hours. When they're over here.

Once transferred to India, the jobs offer a standard of living there comparable to that of a contract janitorial company over hear with a similar lifestyle – working nights, long hours, for less than a family wage, in a high-stress environment. Or, in other words, over there it's not a decent job; it's a low-end, living wage job with no benefits and no environmental or safety protections. Which is the point, after all. Those jobs are being outsourced there so that corporations can get a cut-rate deal for the same work. If they had to provide the same standard of living that they do over here, then there wouldn't be any huge cost savings, and there wouldn't be any point in outsourcing.

Thus, the answer to the question: 'Don't Indians deserve good jobs?' is: 'Yes, they do. So, are you going to start providing them some?'

Of course, in a country suffering from heavy unemployment, starvation, and large numbers of suicides (an epidemic in India from foreclosed farms), a contract-janitor's standard of living can look comparatively enticing.

Then again, the wrecked state of India's economy was in part caused by those same corporations now outsourcing jobs to them – setting up an awful, awful conflict of interest. Wreck their economy, take their land, then put them to work for you on land they once owned at rock-bottom prices.

Which brings up a second, even more pertinent, answer to the question – 'Why do you think whites have to provide Indians with decent jobs? Don't you think Indians can provide decent jobs for themselves?'

Because, you know, it is whites who are at the top of these outsourced organizations. Yes, often outsourced jobs are contracted out to a company local to the region, and the managers (overseers) of said local companies make a decent living, and the owners of those companies make a good living, but, of course, it is still whites who are sitting on top of this outsource company structure making all the real money.

But what does it matter where the jobs come from?

Ah, as the old colonies discovered long ago: in the short term, nothing at all. But in the long term, when millions of locals end up working for a few thousand outsiders on land that was once their own…trouble brews. Trouble that ends in bloody revolution.

But let's go back and discuss the original, sidelined question: the merits and flaws of globalization.

Firstly, outsourcing isn't new. Japan, Hong Kong, the Philippines, and Puerto Rico are among just a few of the countries who have received outsourced jobs in previous decades. And back in the day, the US was a received of a outsourced jobs from Europe, especially Britain.

You see, the idea of globalization isn't 'new'. The world isn't even newly globalized. In fact, there have been several different periods in history when more goods were traded per person than the amount currently being traded today. In previous eras, certain goods were only available in one or a few areas, and those goods went EVERYWHERE.

Yet, even if we do as most globalization proponents do and simply ignore the Exchange of Goods argument (in a discussion of trade no less), so to instead focus on the new INTERCONNECTIVITY of the 'modern' globalized system, even then the globalization era is not the most interconnected era in history. That would be the time of the British Empire. In that era, all of the British colonies had their particular specialization, and the US for a time played a role similar to that which China does for the US today – manufacturer.

Now, the U.S. did inherit control of a large chunk of the British Empire when that empire fell, and has since expanded on what it inherited, but the U.S. just doesn't have that flair for rule of disparate lands that the Bretons have, and so the US has not been able to even come close to forging an interconnected trade system that would rival Old England's.

Well, does that mean the US trade network is a solid second, then? Because second is still commendable.

Nope. That second spot would be the vast Spanish Empire. (Which in my opinion might even really be first, but English history has kind of relegated the Spanish Empire.) Spain did a lot of plundering in its territories, instead of colonizing, but it's not like they didn't colonize – as all of South America, Central America, the Philippines, Africa, Asia, and many, many islands can attest. And many of those places eventually received outsourced work.

Spain, second place. Right. So, that means the U.S. is a respectable third. In terms of all of the nations of history, that's still amazing.

Nope. Third would be the Portuguese Empire.

Fine. Fourth. Fourth in all history. That's still a good show.

Well, probably fourth. I'd be a little leery of the French Empire and the Dutch Network, but yes, fourth. Probably. Maybe fifth. Or possibly sixth. But up there, sure.

Now then. You might have noticed that all of those other nations ahead of the US are empires. Well, that's because empires tend to craft an interconnected trade network in the wake of their conquering. That goes all the way back to Rome needing to import Egyptian grain in order to survive.

Yes, the ideas of globalization are as old as the Roman Empire.

The only new thing about globalization is the name – renamed for YOU by PR. Renamed, as has so much else been renamed in the modern era, when names are sometimes changed three times a decade.

Well then, what are the merits and flaws of a globalized system?

The merits are:

  1. Bundles of money for the people in charge. The ability of colonies to earn hordes of cash for the colonial heads (ie the plantation owners) is undeniable. A quick glance through the records of the slave plantations and the South will show you that.
  2. A trade alliance often promotes stability amongst the member of the network, who will often share in each others' defense – even if its only to protect the network.
  3. That's about it, really.

A good trade network with a large exchange of goods has lots of additional benefits besides trade. But, once again, globalization isn't about promoting the exchange of goods. It is about establishing a specific kind of trade network. Which is why there aren't a bunch of Chinese and Indian good flooding into the US, despite the heavy amount of trade.

The flaws are:

  1. As such a trade network succeeds and expands, more and more locals are employed by the foreign corporations. When a country of millions of brown people ends up working for a few thousand foreign white people, trouble starts. See Africa.
  2. A specialized, interconnected system tends to be highly fragile. Fragile things break easily. When things break down, goods stop moving. For the producing countries in a specialized system, that means starvation.
  3. The system is highly vulnerable to price fluctuations. The old adage of: Don't put all your eggs in one basket. If a country is specialized in one good, and the price of that good falls, devastation results. And even if the price of that good rises steeply, that's not a reason to celebrate, as one would think. Instead, it usually ends in other countries in the network looking for an alternative to that good so they can stop buying it.
  4. Using trade imbalances to generate profit is an exploit (currently a huge and highly profitable one), and that kind of profit generates huge inflation. But eventually exploits come to and end, only you're stuck with the inflation.
  5. This kind of exploit usually has about the same effect on an economy as a gold rush, handing bundles of money into a few hands, which causes inflation, inflation that most people's wages aren't rising to match since they don't get a share of the gold. See the Spanish Empire.
  6. The longer the trade network is maintained, the more intervening that has to be done in order to maintain the network. Trade imbalances tend to return to balance over time. Customs and laws change. People want to own their own countries. Chaos and war. Revolutions. –The trade network has to fight against all of that. Ie why Western corporations are fighting against any proposed Chinese labor laws.
  7. The whole nature of the beast is a massive subsidy to the corporations involved. The producing and manufacturing countries have to be kept stable politically, economically, and socially. The lines of trade have to be guarded. Transportation costs have to be kept low. Rivals have to be kept at bay. And corporate assets have to be protected from being nationalized. And the policing nation gets to pay for all of that. Don't believe a government would intervene for a corporation? See history of the East India Trade Company, National Fruit, Halliburton.
  8. Endless interventions on behalf of maintaining the globalized system means endless interference in other countries elections, social movements, laws, policing, and rebellions. Which means endless bribery, corruption, and assassination. But most of all, it means fighting endless spot wars (or police actions, or military interventions, or humanitarian interventions, or whatever is currently the word du jour).
  9. Intervening doesn't create friends. See 9/11.

But such is what the globalization system has been since Roman times, and such is what it will always be. It comes and it goes as empires bring them into being, and then fall apart as the empire loses control of it and can no longer hold it together. But it always comes back when the next empire arises, because of those obscenely vast sums of money that it generates for those at the top. Those mountains of gold are hard to ignore.

Tuesday, May 17, 2011

My "Qwest Sucks" Saga


It begins with a different issue. 3 times in 2009, my Qwest account was crammed. Despite being promised refunds, I only ever got a refund on the 2nd of them. The first I did as I was told and paid the dispute charge. The third time (since I still had not received a refund on the 1st) I simply refused on principle, and have kept refusing for two years – on a charge of about $8.

Now, on January 28th 2011, I send a check to Qwest for my regular bill of $28.35. I still have the carbon stub, and the check very clearly was written for twenty-eight dollars and 35/100, but when Qwest sent the charge in to the bank, they shifted the decimal place over two points and took $2835.00 from my bank account.

This shouldn't even be allowed to happen.

The money showed up as a credit on my Qwest account, which I noticed on my Feb bill. So I called Qwest immediately, reported the issue, and specifically asked them if the money had come from my bank account. After investigating for a half-hour, they assured me it had not (untrue, as my bank was soon to inform me).

Qwest then told me the matter would be put under investigation, and they would call me if they needed anything else from me. When I didn't hear from them, I figured the matter had been resolved. A month later, though, the money was still gone from my bank account and I still had the credit on my Qwest bill.

So, on April 1st, I called Qwest, and they informed me that they needed to make a three-way call with me and my bank to prove that the funds had been taken from my account (begging the question of what they had been doing for the past month). We did that, and I was promised by Qwest that a check would be going out immediately, and that I would have it within the week.

A week-and-a-half later, I hadn't received it, so I called Qwest again (3rd call), and was informed that the check had not gone out and would not be going out until April 15th, and to call them on the 25th if I had not received it. So, on the 25th, I called Qwest again (4th call), and was informed that the check had not actually gone out the 15th but the 18th, and that I should be receiving it any day now. Another week later, it's now May and I still don't have my money, so I called again (5th call), and was informed that depending on what center the check had come from, it might take up to a week MORE.

I reported the issue to the FCC, and finally on May 16th an overnighted check arrives. And it's short.

The wrongfully acquired funds had been automatically applied to the hanging crammed charge (of course) and my Jan bill, then later was applied to my Feb bill. When I called Qwest about this the first time, back in Feb, I was told I would be refunded the original amount minus the Jan bill, but they actually refunded me the current credit balance – essentially meaning I ended up paying my February bill twice. Which should have meant a credit of $29 would show up on my bill, right?

No. Because someone made a manual adjustment to my bill, removing the credit and recharging me for the hanging cram charge – essentially asking me to also pay the charge a SECOND time, on top of causing a full month's payment to disappear.

When I called on THIS issue (6th call), after being transferred 3 times, and an hour and a half on the phone, I finally got ahold of somebody ready to resolve it. So, Qwest refunded the money to me with a credit to my account, but they charged a "tax" of a few cents on the funds when doing so. Thus, essentially, they wrongfully took $2800 from my account, took 4 months to give it back, and have now charged my a fee for doing so.

  1. Charging a fee to refund money they mistakenly and wrongfully acquired should be HIGHLY ILLEGAL.
  2. This matter should have been resolved after 1 phone call, not still unresolved after 6.
  3. After they finally admitted they needed to send me the money, it shouldn't have taken them 2 and half months to do so. The funds should have been sent immediately.
  4. If the funds weren't going to be sent immediately, they should have said so.
  5. It shouldn't even be possible for an error like this to occur on a check.

Sunday, April 10, 2011

Globalization – Why Does It Work? And Why Does It Fail?

Globalization – Why Does It Work? And Why Does It Fail?

At its core, despite what sometimes has been said about it, globalization is actually a simple system. But unlike many other simple ideas, Globalization's simplicity doesn't make it strong.

It is actually a rather brittle system, since it relies so much on perfect variables that it demands remain forever unchanging. And since the world is complex and changing and imperfect, well….

The main component of Globalization is said to be interconnectivity. That is not actually correct. Interconnectivity is one of the results of Globalization, but it is not one of its component building blocks, much less the main one. The primary component of globalization is specialization – the idea that every location in the world should specialize in what they are best at, whether that is making bananas (India), electronics (Japan), or babies (China, ie cheap labor).

To illustrate: say there was a small island with a poor climate for wheat and corn, but an a climate and land ideally suited for growing cocoa, but most of the land was devoted to making wheat and corn in order to feed the people of the island, with whatever land was left over (which wouldn't be much, since the island isn't an ideal place for wheat and corn, and so would require a lot of land to grow a meager crop) devoted to cocoa for export, bringing in a meager but non-vital income to the island.

Well, the idea behind Globalization is that that island should, instead of growing food crops and some cocoa, devote itself solely to the cash crop of cocoa, which they could then export for vast (since they can grow a lot of it on their land ideally suited to its growth) sums of money, which monies they could then use to but whatever foodstuffs they needed, with a lot of profit then left over with which to but other non-necessities. then that place should be making cocoa and nothing else, so that instead of wasting their

That's actually not a new idea, by-the-by, despite what you might have heard. Not so long ago, it was called cash-cropping, and the countries who based their livelihoods around it (often not by choice) were called banana republics. But the idea has gone by other names, as well, because it is far older than that. Far, far older. Going back not centuries, but millennia.

In fact, there are eras in history that have seen far more trade per person than what is currently happening now. It is one of the strange foibles of the Globalization system that it doesn't produce a lot of exchange of goods. (One can go down to the shops and easily grab a garment Made in China, but it's difficult to go and buy an actual Chinese garment.)

The sheer ancientness of the ideas makes it quite easy to discuss the methods and results of globalization, since it is a system that has been thoroughly studied for millennia, with countless reports and treaties and studies devoted to it.

So, the idea at its basest: Essentially, globalization breaks down the countries of the world into three (sometimes four, if one separates the finance center from everyone else) categories – the producers, the manufacturers, and the developed (or consumer, in modern-speak) countries.

Now, the difficulties that the producer countries can face under Globalization are well-known and well-documented, but I will mention them briefly anyway, for the sake of completeness.

When one location devotes itself solely to one crop, they become dependent on the global market price of that crop.

  • If the price falls, the manufacturing and developed countries that make use of that product prosper, but the producing country earns very little money for selling its produce, and since it now has to buy and import its people's food, that falling profit means that now it can't afford to purchase enough food to feed its people, and its people starve.
  • If another country decides to sharecrop the same crop, then there were be an oversupply of the crop on the global market, ie with two countries cocoa there will twice the amount of cocoa on the market than there was the previous year, and that without any increase in the demand for cocoa, meaning that neither of those countries is going to sell all of their crop, and with the oversupply what they do sell will be sold at a reduced price, meaning that our little island won't earn enough from the sale of its crop to but food for its people, and its people will starve.
  • If there is a disruption to the trade network, such as a nearby war and the resulting attacks and raids on transports, the producing country will no longer be able to gets its food to the buying countries, and since its people can't eat the sharecrop, its people will starve.
  • If there's a blight on cocoa one year, the producing country has no other source of wealth or food (since it has wholly devoted itself to its cash crop), so it won't be able to sell any cocoa that year, or at least very little depending on the blight, so there won't be any profit from sales of the crop that year, meaning the island won't be able to import any food at all, and its people will starve.
  • (Yes, there's a lot of hunger going on in this kind of system. That's the way it is. With the old full farm style, people are poor, but most years they are well fed).
  • During the changeover from food crops and a little cocoa to only cocoa, few farmers won't have the seed, tools, and knowledge ready for mass-producing cocoa, and so will need to reorganize and restock their farm for the cash crop, purchasing equipment, seed, and training usually on loan (bet you can see where this is going already, after recent events) which – in the usual way of loans – sends the farmers into a period of austerity while they try to repay their debts, and then one of the above calamities happens and they lose the farm to the banks (often leading to suicide in many nations, such as India).

And that's just the tip of the iceberg for the producing countries.

Which illustrates why the Globalization system is so brittle – no disruptions can be allowed under Globalization. And disruption to the trade network causes an instant spiral into starvation. Which is why the developed countries (who the globalization system is designed around) have to be involved in the affairs of so many countries – they can't afford to allow any disruptions to the system, or the brittle thing shatters.

However, that is actually just the beginning of the system's brittleness. The system isn't only brittle at the cash-cropper level; it's also brittle at the manufacturing level, and for many of the same reasons.

The manufacturing countries are – like the producing countries – specialized, but instead of being specialized in a crop, they are specialized in industry and manpower. Such congregation of industry tends to quickly aggregate a lot of wealth in these countries, since every industry is generating profit based on cheap goods from the specialized producing countries that they process with masses of cheap labor, but – as Ireland so recently discovered – profits that appear quickly, can even more quickly disappear.

  • If another country decides to offer a better manufacturing deal to the developed countries, all of the industry leaves the original manufacturing country, and a large section of the populace immediately ends up idle, out of work, and starving (there usually aren't unemployment benefits in these cheap labor countries).
  • If there is a disruption to the trade network, such as a nearby war, the goods can no longer reach the manufacturing country, and a large section of the populace immediately ends up idle, out of work, and starving.
  • If the price of transport rises markedly – such as a fuel shortage – it becomes no longer profitable to transport goods over long distances, which means it is no longer profitable to transport goods from the producing countries to the manufacturing countries and THEN to the developed countries, and the developed countries will cut out the middleman – ie, the manufacturing countries.
  • If the local trade, business, or public laws change unfavorably to the developed nations, all of the industry will leave that manufacturing country, and a large section of the populace immediately ends up idle, out of work, and starving.
  • If there is a public relations nightmare of some kind (such as, up to recent times, a communist revolution), all of the developed nations will abandon that manufacturing country, and a large section of the populace immediately ends up idle, out of work, and starving.
  • If the developed countries suffer a downturn, then the manufacturing countries no longer have anyone to sell their manufactured goods to, and since they are specialized in manufacturing (and thus don't produce much of their own food), they no longer earn enough to import food from the producing countries, leaving their people starving.
  • If ONE source for a multi-faceted product drops out of the trade network – such as because of a war or a natural disaster such as a tsunami – the entire manufacturing line grinds to a halt, because under the specialized system each part is produced in only one country, thus insuring that every producing country and every manufacturing country and all of the land and sea between must at all times be stable, safe, and unchanging in its laws, international relations, government, and social philosophy. Which means the developed countries will constantly intervene in the policies and governments of the manufacturing countries, leading inevitably to a desire for independence, followed by crackdown, resulting in resistance and revolt, and the loss of that country from the trade network and thus a breakdown of the entire network.

The brittleness of Globalization at the manufacturing level is less well-documented than the brittleness at the producing level, but it is still relatively well-known in the more internationally-oriented fields of study.

But much less well-known is how brittle the system also is at the developed level.

For the most part, it is widely assumed that Globalization can only ever benefit the developed countries, even in troubled times. But that is all it is – an unproven, and even untested, assumption based on formulaic reasoning.

To illustrate the brittleness at the developed level, one must first go examine the method of Globalization. How is it implemented?

In essence, a developed country slices off a portion of its production or manufacturing economy and ships that portion out to individual countries that being specialized in that field, whether willingly, through coercion, or force – see India, Hawaii, and El Salvador, just for starters.

What are the benefits in doing so?

To take from a real world example: it might cost $25 to produce a shirt in a developed country, which would then be sold to retail stores for $45, who would then keystone (ie the standard mark-up) it to their customers at $90.

But you could have that shirt made in a specialized cheap-labor country for $1, who would then sell it to a distributor in a developed country for $4 (note: more than keystone) + $1 shipping, who would then wholesale (which is supposed to be 1.5x mark-up, or at $7.50 in this case) it to a retail store for $12 (again more than keystone, and so technically NOT actually wholesale), who would then sell it their customers for $29 (again more than keystone). So, at every stage, everyone is making a lot more money on that shirt, AND the eventual customer gets it a price 1/3 of what it would be if the shirt had been produced in the developed country.

So, everyone's happy and really wealthy, and the customer got a cheap good, right?

Mhm, if all the variables remain perfect, yes. It does. At first. But eventually it becomes harder and harder for the developed countries to maintain that perfection.

First and foremost, keystone is the standard rate of increase for a reason – because that is the system that has developed over thousands of years of trade as being most suitable and fair.

The above example with the shirt being shipped out to a specialized country is called an exploit. Essentially, it is an imbalance in the system that someone has found and is profiting from. Nothing special about that, really. That's the essence of finance.

Normally, though, over time such exploits tend to smooth out back to keystone. The owners of the companies in the cheap labor countries start earning more, they buy things with that wealth, prices rise, workers start demanding pay raises, owners at the different stages start to demand more of a cut of the overall profits from the exploit. Competitors come in offering the same product at a discount. Etc etc.

Eventually the exploit just smoothes away.

And that's if it all doesn't get sent up in a ball of fire for any of the reasons above.

Which means that, over time, if the developed countries want to keep that exploit in existence, they must intervene in the social constructs, governments, and policies of all of the producing and manufacturing countries in their trade network, and they must do so ever more frequently the longer they try to hold the exploit in place – whether it’s the need to maintain cheap fuel for transporting large amounts of product over vast distances, the need to maintain business-"friendly" governments in the members of the trade network, the need to maintain peace and security across the shipping lanes and the countries that border it, the need to keep cheap labor cheap, or any of a thousand other needs. Whatever, the price for maintaining so many variables in their perfect condition is steep, and ever-increasingly steeper the longer they are forced to maintain.

It is, in essence, a vast and unending subsidy to all of the corporations involved. If a developed country's corporation ships out its manufacturing to an unstable and corrupt government because of its cheap produce and labor, and then that country nationalizes that product, should the developed country's government then intervene on behalf of the corporation?

Or better yet, ask the question: will it intervene? Historically, the answer is: yes. Whether it's influencing an election in China, bribing a politician in Brazil, maintaining a dictator in Iraq, assassinating a leader Venezuela, maintaining a corrupt monarchy in Saudi Arabia, touching off a coup in Indonesia, or fighting a war in El Salvadore, interventions steadily more numerous, costs price increasing steep, and their price increasingly more cutting.

But with the attentions of the developed countries diverted so heavily towards maintaining their exploits – and counting their moola – they tend to miss the brittleness of their own situation.

Because, you see, cutting out parts of their economy causes them to walk a fine line. A knife's edge, really.

Let me illustrate.

Let us say there's an island that produces a little furniture from its own wood (25% of it's economy), grows sugar (55%), fishes for its food (15%), and weaves traditional hand-woven reed baskets (5%). A simple little economy.

Then one day, the island decides to outsource its furniture production – it never had a lot trees, anyway. All of the people in the local furniture and wood-cutting trade are immediately thrown out of work. But, on the other hand, all of the furniture being brought into the island is 1/3 of the old price. So, everyone else on the island (75% of the people) now need to spend 1/3 of the money that they used to on furniture in order to acquire the same amount as before. That frees up a sizeable portion of their income, which monies they can spend any way they desire, thus making them substantially more wealthy without their companies ever giving them a raise.

Which means that the local economy of the island booms (all that freed up money from the 75% who can now spend). Thus, then, a sizeable portion of the furniture makers and woodcutters eventually find new trade selling imported goods to the now "wealthier" 75%. Sure, the new jobs don't pay as well, but since furniture doesn't cost as much now, it makes up for the loss, kind of. Partly. Enough to get by. Not to mention the furniture bosses who did the outsourcing are now raking it in, and they are buying lots of new goods too.

So, booming island economy from outsourcing.

Yet, the bosses in the sugar trade, seeing how much money the furniture makers made by outsourcing, decide they want to outsource too. So they do.

However, when they outsource, it cuts another 55% out of the economy. Now, most of the islanders are out of work, and they can't even afford the fish and baskets that they used to buy, putting a sizeable portion of those trades that are still left on the island out of work also. The economy collapses due to there not being enough wealth produced there to purchase any of the imported goods, even at the cheaper price. The furniture bosses invested well, so they are doing fine, living in their new mansions and employing a few of the locals as servants. But the sugar bosses end up selling their companies on the cheap to an outfit from the hated island next-door, who then set up an extractive system that employs few, and that terminates them all without notice on any bad year, and maybe doesn't even pay them for the work they've already done when it fires them. Only the basket-weavers still have a full trade, since their industry can't be outsourced, but its produce is mostly shipping out overseas now, since few locals can afford even those old baskets.

Thus, outsourcing initially boosts the overall economy, and it does so immediately and to a large degree. And it will keep doing so with every outsource, but with increasingly less efficiency, and there is some unknown point of outsourcing that will cause internal collapse of the economy.

The promised Globalization answer to the problem of that unknown point is the idea that the developed countries will do what they do best and innovate new industry to replace everything that is lost by outsourcing. Which would then make the economic game for the leaders of those developed countries to be maintaining a balance between innovation and outsourcing, so as to ensure that at no time does the outsourcing get beyond the point where innovation is building new areas of industry. That, while also interfering in the all of the other countries of the network in order to ensure that all the outside variables of the system remain in the state of absolute perfection that is the only state that allows the system of Globalization to remain viable and thus profitable.

And, of course, that's assuming the developed countries are actually as innovative as so many like claim. Which becomes the most important question of all. Is it?

All of which explains why Globalization is so popular and can drive such success – when things are going perfectly, it makes a lot of money for the manufacturing countries, and oodles of money for certain sectors of the developed countries, and even sometimes, almost by accident, makes a bit of a fortune for the producing countries outside of the bribed government officials.

But it also explains why the system is so brittle.

Globalization is a simple system that makes a simple sense, with each country specialized in what they are "best" at. But, so many things can go wrong in so many different ways, with the strain only getting worse every year that the system is imposed upon the global marketplace.

And that's the other thing to know: not only has globalization been tried many times before, it has collapsed many times before. To take perhaps the most recent try: the British Colonial Empire imposed just such a system upon a great deal of the world, and did so for several centuries. But it all came crashing down during the two World Wars.

Which only makes sense since the current system of Globalization is pretty much a rip-off of the British Colonial Empire, yet with a glossy new name.

Friday, March 18, 2011

The Lie of the Wealth Multiplier Effect of Loans

What is the "Wealth Multiplier Effect" of Loans? And why is it a lie?

Of course, "lie" might not be the right term for it. "Grossly misinterpreted stupidity" might be far more accurate, in this case. Regrettably, I am not in a position to fully determine which of those is true. So, you'll have to form your own opinion as to what is behind it all.

But, be that as it may, the "Wealth Multiplier Effect" of a loan is essentially a theory that states: when a dollar of money is loaned into the economy, it produces a value of many more dollars than one – 8 dollars is the amount most often cited, sometimes more.

How does that happen?

Well, when that one dollar is loaned to an individual, that individual will most likely spend that dollar, hence giving a profit to the business that the dollar is spent at, whose owner can now spend that profit at another business, giving a profit to that business owner also, etc, and all those purchased items will now be restocked, which means orders go out to the suppliers, giving them a profit which they will then spend at still other stores.

So, that one dollar loan echoes down the supply chain, and also out through the economy, generating added wealth every step of the way.

But it goes deeper than that (and it must do, because grants would also accomplish everything stated above, which would otherwise mean there was no advantage to loans). To banks, a loan is potential profit – that is, as the loan is paid back, all of its accumulated interest becomes their profit.

So, every loan made has the potential to make them a profit. And since it has that potential, and since there are a lot of eager investors out there, the banks can sell a slice of the action to investors – investors who will then earn a slice of the interest profit (as long as the loan is repaid). Thus allowing the bank to acquire more money immediately from the sale of loan shares, which fresh monies they can then loan out to other people.

And that's the theory. The theory of how one loaned dollar multiplies in the economy by eight times its own value. And the theory is true every step of the way.

Only, it is also most terribly wrong.

Because, you see, it is another one of those modern theories that omits a critical real-world detail – yes, it's yet another on of those. And once you at that detail into the equation, you don't get an eight times multiplier.

That detail: a simple fact – loans have to be repaid.

Oh, the theorists do mention that little point; it is not ignored. Yet, it is set aside, claimed to be not a factor. And, because of that, the theorists don’t even impose the logic of their own theory onto the repayment of the loans.

Which is, at best, negligent.

But, they do it on the assumption the economy is large enough to absorb any austerity that might be imposed on individuals as they repay their loans. Only, as the recent mortgage scandals showed, while a large economy can absorb a lot more risk than a smaller one, that just means that it can absorb more risk, not that it can magically absorb everything thrown at it.

Because, you see, when one takes out a loan, one does end up with a bunch of money now, but all of that money eventually has to be paid back. And more. Because of all that interest that has accumulated. Which means that a lendee will then have to enter into a period of austerity while they pay back the loan, since the loan gets stripped out of their income during that time.

And that means: during that period of austerity, they won't be purchasing their usual amount of goods and services. And that means that the businesses that normally would have received those monies now won't, reducing their profits. Which then reduces the amount that those business owners would spend in the economy, while at the same time reducing the amount of sold inventory that they have to replenish. Thus also reducing the profit of their suppliers, forcing them into a period of austerity too.

But on top of all that, when there are all those excess loan dollars floating around, new businesses get founded in order to make supplies for them to buy. Yet, when the lendees go into austerity, all of those businesses built around the lendees' loan money go under. Not only that, though, because of the excess supply made by all of those extra businesses, a lot of the original businesses will go under also. Take, for instance, the recent mortgage scandals.

A lot of those excess loan dollars were used to invest in property, and so a lot of new construction businesses were built in order to supply the desire for new homes. But now, in a time of austerity, all of those new businesses are no longer needed, but due to overbuilding when there was a lot of free loan dollars, there is now a lot of excess supply of housing, so there won't be a need for many new houses for quite some time, and hence a sizeable number of the original construction companies go under also.

In the end, it is a simple equation. No matter the size of the economy, if more money is loaned into it than it can absorb, then the economy will eventually face austerity. It is an incontrovertible fact.

There is also no mysterious "Multiplier Effect" of loans. Loans are just what they have always been – a way of giving banks your money. Masses of loans do cause an economy to boom, but the boom is a lie, because it a boom based on false profit. That money has to be repaid. So, the loaned boom is followed inevitably by the paying austerity.

A loan can be beneficial to an individual, but there is nothing mysterious or wonderful – it stills just a loan.

Wednesday, February 23, 2011

What is the Answer to Terrorism?

The answer that I haven seen proposed most often by politicians, civilians, and the media is Revenge – 'nuke them back into the Stone Age' and all that.

For every attack, we will respond. If they take one of ours, we'll take ten of theirs, and we will keep doing so until they're too afraid of us to take any more.

The only question is: which side is saying that?

Answer: both.

And so you end up with the endless cycle of revenge, swirling around and around, destroying everyone.

So what is the answer? How do you stop the cycle of revenge? The cheap answer is don't start it. But once it has started, that is, of course, no answer. So, what then?

It's actually not that hard. We already know the answer. Every single one of us, though maybe we've forgotten.

It's called the Law.

People seem to have forgotten that the system of European Law rose up as answer to a system of honor-based tradition that revolved around revenge. The first laws were put into place not to form a legal system based on the extraction of wealth from various peoples, but to stop the endless cycle of family and local feuds.

Those laws established a price for every wrong, including the taking of a life, with the idea being that if the price was paid then justice had been served, and the wronged family was then no longer honor-bound to exact vengeance.

The Law wasn't meant to be fair, or just, or satisfying; it was meant to build Civil Order. And that is what it did.

It took a long time for the idea of those laws to take hold – hundreds of years. And, really, they were famous family feuds still running right up to this century. But essentially the system of laws put a cap on the running violence of that time.

Nothing has changed today. If you want to Keep the Peace, then you use police, Constitutional law, and the courts. If you want an endless cycle of violence revolving around vengeance, then you use Revenge.

It's the tougher choice. The far less satisfying choice. And we keep trying to wreck our own system of Constitutional Law by establishing laws that eke out some kind of just revenge for that very reason. But it is also the only choice currently known that brings Peace.

That is an old lesson, a lesson so old that there are Fairy Stories about it. But the romance of Revenge is so much more enticing and immediately satisfying that people forcefully try to forget this lesson, and so go back to fighting Revenge with Revenge.

Wednesday, February 9, 2011

Crisis of Finance

In case you hadn't heard, this isn't the first time financiers have crashed an economy. It isn't even the tenth. From the Japanese crisis to the Argentine crisis to the S&L scandal to the City crisis to the Great Depression to the Long Depression, they've had a hand in causing them all – meaning, today's crisis, despite what some people keep saying, isn't an abnormal state of affairs. No, this is what they do.

Previous to the Great Depression, banks failed all of the time. And when they failed, depositors lost everything. There were no guarantees.

"Bankster" is not at all a new word. It required a bit of dusting off before it was recently brought back into vogue, but it's been around a very long time.

And not just because of people losing all of their deposited savings. There were the usurious loans, the calling in of debts in moments of bank crisis, and the confiscation of property through repossession.

On top of that, the financiers repeatedly would crash the economy – repeatedly and heavily. So regularly, in fact, that it was given a term – the Boom & Bust Cycle. Because when it was booming (blowing up the balloon) it boomed big, and when it busted it busted to nothing.

And that's how things were.

But, the Long Depression followed so soon after by the Great Depression changed everything. Regulations were put into place denying banks and finance houses the ability to implement the more "creative" investment vehicles which had precipitated so many crises. Bank accounts were insured, so that depositors no longer stood to lose everything. And banks were organized around a federal institution, standing ready to bail them out when they messed up, ready to do so that another "banking crisis" did not arise.

And added to that was a mentality of "safety and security" that pervaded the time. So, for a generation there was stability.

But stability bred complacency. The financiers convinced enough people that they were better now, wiser, with enough internal safeguards that they would no longer repeat the crises of the past.

That notion mixed easily and headily with the neo-liberal belief that the financiers understood finance far better than any government could, and therefore the financiers should be allowed to run their businesses as they, being the most fittest, thought best. Essentially declaring that the financiers needed a free hand so that they could make everyone a lot more money.

So, after thirty years of safety, the government began stripping away the regulations, and the financiers immediately started exploding bubble economies again, with the inevitably resultant bank failures and government bailouts. The first of these to be seriously noticed (but by far not the first) being the S&L Crisis.

Why?

Because it's what they do.

All of the various new investment vehicles aren't actually "new." They're old, warmed over rehashes from the pre-Depression days brought to the modern era. All the old financier favorites, everything they wanted brought back from the "good old days."

And with them came the Boom and Bust Cycle.

It was inevitable. After all, if you set out to return to a Victorian-style economic regulatory system, then you get a Victorian-style economy.

Right now, we're in the Bust, and it's sad and trying and entirely predictable.