Things have been quiet on my site, and on Porter’s site, and at Social Matter. The years at and around peak earnings (40’s through 50’s) are a busy time. Work, children in college, aging family members, and one’s own efforts to stave off decrepitude all distract from ranting on the Internet. Thankfully the indefatigable Z-Man, Brett Stephens and Steve Sailer soldier on for your reading enjoyment.
Because really, what else is there to rant about? Politics as we know it is over. We have piled up $22 trillion in federal public debt alone, re-financeable at negative interest rates. The monied class has run out of things to buy so they’re buying sovereign debt. It’s better than cash, literally, so why are we still paying taxes?
We are at a strange equilibrium where productivity is keeping pace with monetary inflation. For all practical purposes, we are Post-Scarcity. If you don’t believe me, declare yourself opposite-gendered, get a neck tattoo, alienate your entire biological family, reject your culture’s historic religious faith and taboos, and see if you have to go live under a bridge. You won’t. The rules that kept things together in a world existentially dependent on adequate rainfall don’t apply in a world of air-conditioned skyscrapers in the desert.
The only problem remaining in such a world is the equitable distribution of resources. Does anybody have a good answer for why Haiti is allowed to exist while the US and other governments spend out of their deficits to fund the F-35? Why must these same countries take in immigrants from all the places that are, as usual, failing, when we could swoop in with our F-35’s and save them from their own self-rule?
If you’re a free market economist, you’ll say these massive inequalities are a necessary corollary to uninhibited operation of the supply-demand curve. The human eco-system, so the argument goes, must operate free of externality other than consumer preference in order to incentivize capital formation and efficiencies. It’s a good argument. Free market economic policy has produced unprecedented, astounding wealth. All attempts to replace the invisible hand of the market with bureaucratic management have failed, and they always will. Socialism can’t calculate. But the awkward issue for the free market-economist is that this hyper-abundance exists hand in glove with the large, omnipresent footprint of governments and their central banks.
The retort from the Austrian School is that the fiat money-generated boom cannot last. The artificially low interest rates and money-printing distort price signals and divert capital from the “real” economy to the “bubble” economy, the latter being parasitic on the former. Eventually, with the real economy starved of capital, the bubble economy collapses to the level which can actually be supported by real savings (current profits retained to fund future production). As Friedrich Hayek conceptualized it, the Keynesians and monetarists simply borrow from the future, and will eventually run out of future.
The Hayekian view is compelling, as it seems confirmed in Nature. Artificial interventions in biological eco-systems lead to disaster. Animals, not having fiat currency and public welfare, must work or starve. Soft times beget soft people beget hard times, as we on the Alt-Right love to remind everyone.
But what if we’re wrong? What if our economic baseline has reached a level of productivity that can support billions of people with far fewer inputs than previous? We spend kings’ ransoms keeping people out of the labor market until well into adulthood, and still have enough to park a number of them there permanently (we call such institutions “universities”). Large numbers of public and private jobs could vanish overnight with no effect on the cone of production. We have them simply because we can afford it, but we could just pay these people the same salaries to stay home. Here’s Forbes’ list of top YouTube millionaires. Here’s the healthy, enthusiastic staff of the University of Chicago’s Office of Civic Engagement.
Clearly, I have been doing things dreadfully wrong.
The counter to all this remains that we are simply in the Everything Bubble. Like the bald eagles that stopped hunting when the humans arrived and built Dutch Harbor, we will become obese, dissipated, and ultimately incapable of maintaining the technologies upon which we have become dependent.
And so, this strange, quiet Interregnum here in the vanguard of political thought. Are we marching toward a tolerant, borderless future of thermodynamically neutral energy sources overseen by wise technocrats? If so, the Enlightenment ideals and social conservatism of the US Founders do not apply, and I look forward to my YangBucks.
Or is this just the Peak before the accrued capital runs out, and the old gods with terror and slaughter return?
I don’t know. And you can contact Porter, Nick B. Steves or Happy Acres and they’ll tell you they don’t know either. We wait and see–Trump so far has proven to be a placeholder–so getting exercised over which wing of the Globohomo Party should govern the US (and from there, the world) is kind of pointless.