Clubbing for introverts & the why behind the Great Depression 2.0 – Voice of Eden, March 18
|March 19, 2013||Posted by Koanic under podcast|
Correction: That’s 4 post per day at the Neanderhall.
Notes on Moldbug:
Problem is unemployment of the economically useless
Solution A – Run country like a biz, hire and fire, automate and outsource. Kill the useless.
Pig philosophy, king but no computer.
“Universal unemployment is the definition of the Singularity.”
Solution B – Embrace unemployment. EBT card. Detroit. Destroys character.
Natural aristocrats rare.
Solution C – Oculus Rift, physical imprisonment with virtual enrichment.
Solution D – Beyond A, B, and C, we enter the domain of solutions which involve distorting labor markets to integrate these human liabilities into some semblance of a normal institution of production.
keep the peasants fit, healthy and happy, pay them to do otherwise unnecessary work. Like, you know, building pyramids.
The purpose of Solution D is to lose as little money as possible, while maintaining the human quality of your assets and preventing them from degenerating into Hardcore Pawn customers, 10th St. zombies or other revolting parodies of the human condition.
Ditch digging fine for all but natural aristocrats. Federal 1 for those.
makework programs are restricted to strong governments. Ours is a large government, but by no means a strong one. FDR’s was a strong one.
The strong are confident and can tell the truth. A weak government has to shroud the truth in a cloak of lies
Makework has to be defended by lies, whereas welfare is indefensible. The defenders of welfare are therefore forced into the brazen fortress of property – they and their clients must assert that they are entitled to these emoluments, which is of course the one thing they ain’t.
Politically, the ideal way to apply Solution D is to make the actual work as separate as possible from the source of funding. – indistinguishable from the rest of the economy.
inflate aggregate consumer spending
borrow instead of taxing, to avoid annoying taxpayers. but still annoys them with govt spending.
even better: So we have a second-best way to inflate AGDP, convincing the private sector to borrow more(D-2); and a first-best way, making the stock market and real estate go up (D-1).
D1 = USA, Greenspan.
D2 = China
Excessive market cap is like nuclear waste. If it gets out, as in 2008 – you have a problem.
solved by solution D-3, printing money to buy nuclear waste.
Its insanity is totally disproportionate to its actual purpose, ie, employing otherwise idle and useless humans.
significant and unnecessary financial weirdness, whose only purpose is to pretend that the machine is not in fact a makework scheme.
In America, the consequence of job creation through AGDP inflation is the notorious FIRE economy, a central-planning system in which the only income source is asset-price inflation, and the employment created involves Mexican immigrants installing granite countertops and nice white ladies selling real estate to each other.
A critical point is passed in an event like that of 2008, which might be described as the transition from debt capitalism to debt communism.
Under debt capitalism, it is possible to sustain the illusion that both borrower and lender are private-sector agents. Under debt communism, a state we have now attained, borrowing remains a private action, but the Fed is now and forever the lender of first resort.
The bottom line is that in business terms, what’s wrong with the American economy is very simple. It loses money. In order to keep operating on an even keel, it needs to borrow roughly $1.2T a year. In other words, we have a simple way to get 2% AGDP growth per year – expand the debt bomb by 2% a year. We can also inflate the stock and real estate markets, which is better, of course, because equity does not create obligations.
A money-losing economy, like a money-losing restaurant, sucks. It sucks in all kinds of ways that have no apparent connection to finance. The entire dining experience is grim. This, indeed, is the experience of the entire “old economy” outside the little bubbles of Silicon Valley and Wall Street. My in-laws live in Columbus. Columbus sucks. Even with Chairman Ben’s 85-billion-a-month bond-buying “recovery.” It is more and more palpably a Soviet restaurant.
The fantasy of the money-losing economy, like that of the money-losing restaurant, is that if enough money is pumped in, eventually the “pump will be primed” and the engine will restart on its own. On this theory, America has been expanding its debt bomb since the 1930s. Yo, it’s not working. I’d be happy to bet any sum of money on what would happen if Chairman Ben turned off the QE. If you are into professional betting, bet on zero interest rates for the infinite future. “Capitalism” with zero interest rates is a mockery and a monstrosity – but there is no alternative within the system.
Debt has to be serviced. Debt saturation happens. When it happens, debt deflation begins – and in a debt-deflation phase, even borrowing at 0% is no longer a market operation.
Once debt deflation begins, there is no alternative but reflation by direct government spending, in the classic “Bernanke helicopter” mode. While the political system is always capable of helicopter drops in theory, it may not be capable of it in practice. And if it can achieve direct inflation, it has still entered a purely Soviet mode in which all investment is directed by the State.
And all this, just so that marginally employable Americans with an IQ of 95 can have jobs. Which many of them can’t.
Nothing other than what we’re doing now is politically possible, at least, not without regime change. As Hunter S. Thompson put it, that bothers me the way VD bothers a Hell’s Angel.
Recommendations: cut all imports, continue exports. Vox Day agrees, free trade is a weapon of the strong, and US is no longer strong. Less fun – more prosperity.
Tech restrictions – e.g. handmade kid’s toys only, giving jobs to idiots who can whittle. Artisanal farming mandates. Etc.
And regime change, currency collapse, strong government ala Singapore. A King who can wield the power to implement these solutions. Plus, a better people wouldn’t hurt.