The future crisis of nations Public Debt

[Vendrah]

This is a subject that were most commented by [MENTION=4347]Virtual ghost[/MENTION] and it did caught my attention too.

For those who might not be aware, now most of nations have a large public debt. US had passed the 100% GDP mark of public debt, some other countries as well. This is not a developed or under-developed country (I thought it was 3 years ago lol). Japan is the country with most debt so far, with more than 200% GDP.

These debts grow and grow with time and, although in the short years I dont think anything of special is going to happen, it might happen anytime soon. So, what you guys think might happen?

There is also some stuff that are really happen.
I think the rise of the public debts has everything to do with the rise of neoliberalism. If you stop to think about it, putting the state into a large debt with a high interest rate is a good way to kill the state and reduce/nerf its influences, since it forces the state to reduce other expenses in order to pay the debt and opens the door for the neoliberalism politicians. Making a "statist" politician to bait this trap is not actually hard - getting a corrupted or perhaps just short-sighted politician on any party isnt that hard in the last decades.

What actually happens today is that the public debt is a good way to make the welfare state to eat itself (to null a part of its purposes). Let me explain this better. The welfare state and "big" states are supposed to have a wide set of public services, and these public services goes from tax payers; These kind of states makes accessible services that are not accessible to poor people by capitalism default. Some of them does even have measures made to combat poverty and re-distribute wealth in a less unequal way, so the welfare state works a lot in order to drop Gini.

The public debt and its interest rates does pretty much the opposite. The average tax payer is poorer than those who win money from the interest rates from public debts. What does happen is that the money from public debt goes from the average tax payer pocker directly to people who profit out of the public debt, that are richer than the average payer, so the effect of state into reducing Gini is mitigated. With the right politicians, debt and place, this can even work as a way to use the state to increase inequalities - a good way to make the neoliberalism rich guys happy. So, basically, its a way to take money of the average Joe right to the pockets of rich people - and perhaps superrich too - in a total "legit" way.

In the case of Brazil, the public debt origin is largely unknown. But as I had checked last year, it seems that the public debt interest rate takes about 40-50% of government spending already. Seems likely, because even this sort of information is confusing. The spending on equality programs - programs against poverty that basically are expenses for food or a small extra income (something like 50 dollars monthly) for Brazilian super-poors is more than 10x less than what is spent by paying the public debt interest rate.

In the case of Japan, I do wonder if the public debt is the 21th century solution to control "the japs" (I guess jap is what US people call the japanese when they want to see them in a negative way), because with a big debt sure somebody got some influence and control over government. There is a word that google translates as sovereignty (originally, soberania), which is a word that means that a government is supposedly independent from other governments or any other sort of parties and is able to have decisions of its own. I do wonder if the big public debt is the way to take away the japanese sovereignty while still officially making the japanese state as "sovereign".

 

[Virtual ghost]

This is a subject that were most commented by [MENTION=4347]Virtual ghost[/MENTION] and it did caught my attention too.

For those who might not be aware, now most of nations have a large public debt. US had passed the 100% GDP mark of public debt, some other countries as well. This is not a developed or under-developed country (I thought it was 3 years ago lol). Japan is the country with most debt so far, with more than 200% GDP.

These debts grow and grow with time and, although in the short years I dont think anything of special is going to happen, it might happen anytime soon. So, what you guys think might happen?

There is also some stuff that are really happen.
I think the rise of the public debts has everything to do with the rise of neoliberalism. If you stop to think about it, putting the state into a large debt with a high interest rate is a good way to kill the state and reduce/nerf its influences, since it forces the state to reduce other expenses in order to pay the debt and opens the door for the neoliberalism politicians. Making a "statist" politician to bait this trap is not actually hard - getting a corrupted or perhaps just short-sighted politician on any party isnt that hard in the last decades.

What actually happens today is that the public debt is a good way to make the welfare state to eat itself (to null a part of its purposes). Let me explain this better. The welfare state and "big" states are supposed to have a wide set of public services, and these public services goes from tax payers; These kind of states makes accessible services that are not accessible to poor people by capitalism default. Some of them does even have measures made to combat poverty and re-distribute wealth in a less unequal way, so the welfare state works a lot in order to drop Gini.

The public debt and its interest rates does pretty much the opposite. The average tax payer is poorer than those who win money from the interest rates from public debts. What does happen is that the money from public debt goes from the average tax payer pocker directly to people who profit out of the public debt, that are richer than the average payer, so the effect of state into reducing Gini is mitigated. With the right politicians, debt and place, this can even work as a way to use the state to increase inequalities - a good way to make the neoliberalism rich guys happy. So, basically, its a way to take money of the average Joe right to the pockets of rich people - and perhaps superrich too - in a total "legit" way.

In the case of Brazil, the public debt origin is largely unknown. But as I had checked last year, it seems that the public debt interest rate takes about 40-50% of government spending already. Seems likely, because even this sort of information is confusing. The spending on equality programs - programs against poverty that basically are expenses for food or a small extra income (something like 50 dollars monthly) for Brazilian super-poors is more than 10x less than what is spent by paying the public debt interest rate.

In the case of Japan, I do wonder if the public debt is the 21th century solution to control "the japs" (I guess jap is what US people call the japanese when they want to see them in a negative way), because with a big debt sure somebody got some influence and control over government. There is a word that google translates as sovereignty (originally, soberania), which is a word that means that a government is supposedly independent from other governments or any other sort of parties and is able to have decisions of its own. I do wonder if the big public debt is the way to take away the japanese sovereignty while still officially making the japanese state as "sovereign".

Yeah, but there is a twist in all this. The large public debt or debts in general are quite likely to kill neoliberal economics are well. Which for the most part runs on temporary solutions instead of more systematic ones. If am not mistaken the world is currently sitting on something like 270 Trillion $ debt. What is very high even for the whole world combined. Therefore since this large debt is chewing away plenty of things through the standard of living there is growing opposition to the current model all over the map. While the current pandemic greatly speed up that process, since it broke too many links that were holding things together.


I mean many countries spent very large sums of money on completely pointless stuff and through that someone got artificially rich. However that model seem to becoming unsustainable because the debt is going into the red. In a way I am lucky that I live in the country where they came to the edge of the red and made the pledge to reverse course (what indeed happened). Because once you get crippled by debt it is hard to get out of it without suffering obvious losses. Since large debt disrupts the balance between spending and what you need to spend to have a normal life and situation under control. What usually only brings more debt. EU as whole has certain rules to how much the members can have in public debt but unfortunately that isn't always enforced. However the good news is that paying of the public debt is a direct stimulation of economy, especially if you are paying to the locals. What in the end acts as some sort of stimulus for the economy. Since it brings in new money into the game and in general lowers interest rates for public debt. What means that without the control of debt you have very low odds of having a decent and economy. However that requires certain discipline and planning, while most people regardless so their social position are kinda lazy in that regard.



Here are some of the numbers for the more important countries. (but I don't get how US is doing the math, since that should be about 130%)


World debt clock

 

[Lark]

These things are hot political topics, with people either anticipating a collapse of capitalism or welfare spending priorities, depending where you stand and what are your priorities.

Although, if you want to take the long view, after the first war most of the world's governments had massive war debt, it didnt stop them fighting a second war and accumulating further debt. I think the UK only managed to pay of their war debt to the US in the nineties (promptly acquiring a lot more by joining in the Bush-Blair wars).

So there are precedents of the national governments managing debt of this kind before without it ending up in some sort of apocalyptic scenario, will it result in war, I dont think so. The principle possible antagonists in any such conflict are less and less fans of open, mutually assured destruction style conflict anyway, the sort of conflict which has served them the most has been of a more indirect, devious, disrupt and deny variety. More likely would be a series of protracted proxy wars or perpetual low intensity warfare of the sort that Orwell predicted as a "new normal" in 1984.

I dont think that debts are liable to cripple or kill neo-liberalism at all, they've already made massive moves to privatise debt, what was at a time public debt is now usually personal debt in the form of easy credit, in the anglo-sphere anyway.

Instead what I think SHOULD exhaust neo-liberalism is a much better public record of how much of a failure private firms are at managing large public projects, the security of the Olypmics in the UK is one example, they needed to use troops as the G4S was incapable of mustering the numbers with the short term contracting they used as a business model (the capital was largely unpoliced and there was an unreported mini-crime wave at the time).

There are myriad examples of failure in the provision of care facilities, all sorts, by G4S and others. Currently the testing system in the whole of the UK is overwhelmed because of mismanagement and the trusting of the whole thing to a private firm with no record of success handling such projects but a lot of promises and close ties to the ruling party.

There have been two separate tracing apps for phones which have totally failed, both private enterprises with close ties to the ruling party and it was clear the apps where intended to capitalize on a willingness to forego privacy rather than control pandemic spread as intended.

Its not incompetence, its definite corruption. It does not seem to perturb the public as it should, it is not reported as I think it should be either. This is why I say it should be an existential threat. Although I am unsure it is or will be. Not that I actually see public management as an alternative, at least not presently, as the managers are proving ineffective, even if this can be attributed to profiteering and corruption, I think they would mismanage any alternative policy because it would involve attempts to subvert "business as usual". I do think that certain forms of transparency, if the media could get its act together, that these things could help, also a public more likely to respond to information.

I'm a socialist but I dont think all sorts of capitalism are created equal, I think that there is a better sort of capitalism than what I would project is becoming typical. Public debt is just one symptom and I think problematic more because it is exploited as a reason to attack the meagre resources of the most vulnerable and dependent in society, welfare budgets, whatever anyone may feel about them in terms of values, are miniscule compared to other expenses.

 

[Virtual ghost]

I dont think that debts are liable to cripple or kill neo-liberalism at all, they've already made massive moves to privatise debt, what was at a time public debt is now usually personal debt in the form of easy credit, in the anglo-sphere anyway.

I disagree since neoliberal economy tends to be generally ineffective even in the private sphere, perhaps even more than in public part. One of the main reasons why there is rising public debt is exactly because the governments have to save over and over vital companies from economic implosion. Which is because this system of economics is based on simplistic solutions that tends to maximize profits on the short turn without long term strategy. Or they are simply gambling with the whole company and then what happens happens.

As it is now private sector is even more bloating the debt bubble, but since the public one is also slowly but surely getting into red the whole system is becoming unsustainable. Especially since most of real economy got outsourced in a number of countries, so even that check and balance has failed or simply isn't there. The fact that they privatized the debt doesn't mean that much for the whole system that is pilling debt all over the map. Since this level of rising debt will brake the system regardless of private/public sphere. What is because real economy got outsourced by good margin and there often simply is not enough assets to return all the debt once the company fails. So the governments have to fix this the best way they can in order to keep economic chains going, however they can't do that forever. What in the end is likely to produce cracking of entire system, which we are actually seeing in practice over the years.

 

[Vendrah]

[MENTION=4347]Virtual ghost[/MENTION] & [MENTION=7280]Lark[/MENTION]
I still think that this might be leading to collapse of governments and a change to a world ruled by corporations. There are not much fictions on this, but there a few science fiction stuff out there (like Final Fantasy VII and Resident Evil) where corporations rule the world, so visualizing this might be hard if you didnt ever had a contact with any.

That is what the neoliberals want in a more extreme way, it doesnt actually leads to anarchy (even if they make appear so so they can have some happy ancaps thinking that they can do whatever they want when governments gets down), but instead to a corporate-ruled capitalism with no state at all.

The key thing to the debt is the interest rate: We do not even know if there would be a debt if it had no interest rate at all (by no interest rate I just mean inflation corrections). I think these debts will grow with time to the point where, if the government sells everything, it would still be in debt, so they can declare the bankruptcy of the government. So the end point should be some point where the government might end privatizing everything (privatize is the word for government selling itself here). I think we are sort of in transition to the corporate-ruled world where the new kings will be the corporate owner slowly. I hope I dont look crazy here, but, if we stop to think about, that is already happening. If we think, for example, in terms of data, a few decades ago, the governments had the most data about regular citizens. Today, its the corporation, Google as a company probably knows significantly more about me than my government. As I had stated, the rich already indirectly use the tax to take money away from the average Joe already (tax money goes to government, government has to pay the high interest rates) and as you noted government already send money to corporations right from tax payers from time to time (pay attention that what is a crisis to the regular Joe might no be a crisis at all to superrich corporations). These crisis should get more intense from time to time, with governments getting smaller and smaller with bigger and bigger debts and with bigger and bigger taxes (I think wealth tax is increasing overtime in general, from what I had a look on OCDE website; This increase should be caused by the debt), until they get bankrupt, but on that point the average people will be so used into paying a high tax that wont return (because it is actually being bombed to the corporations by the interest rate of the debt, but they should use the argument "government is inefficient" to make it weaker instead).

I know that officially and formally, a government cant bankrupt, so it wont be literal bankruptcy, but it should be instead the government slowly giving up influences, which should be happening already, combined with the government losing its "rights" in the future (like, for example, making room for the corporations to indirectly do their own law; Perhaps the deregulation serves to that).

That is what I think it is going to happen. I think the crisis will be there for us; But for corporations, just more and more profits, and the lesser the welfare state government, more money will speak for power instead of anything else. All I said here probably matches with facts: More privatizing, wealth and citizen taxes growing with time, more public spending to pay the debts that always grows, increase on Gini and the deregulation on the top of that. Deregulation on an environment with low Gini and plenty opportunities for the average people does indeed causes more freedom, and they will sell it as that, but deregulation on environment with a high inequality and low opportunities for the average people just make room for the big corporations to actually set the rule. The market rules, and the corporations rules the market (on a high inequality country, that does work). Of course, the corporation ruling the world wont be obvious as it is on some fictions like Final Fantasy VII, but more like on Resident Evil where Umbrella Corporation have big secret installations (with the absence of government they have the right to do that, although in Resident Evil they probably just cheated), and that is the true invisible hand controlling the market.

 

[Lark]

I disagree since neoliberal economy tends to be generally ineffective even in the private sphere, perhaps even more than in public part. One of the main reasons why there is rising public debt is exactly because the governments have to save over and over vital companies from economic implosion. Which is because this system of economics is based on simplistic solutions that tends to maximize profits on the short turn without long term strategy. Or they are simply gambling with the whole company and then what happens happens.

As it is now private sector is even more bloating the debt bubble, but since the public one is also slowly but surely getting into red the whole system is becoming unsustainable. Especially since most of real economy got outsourced in a number of countries, so even that check and balance has failed or simply isn't there. The fact that they privatized the debt doesn't mean that much for the whole system that is pilling debt all over the map. Since this level of rising debt will brake the system regardless of private/public sphere. What is because real economy got outsourced by good margin and there often simply is not enough assets to return all the debt once the company fails. So the governments have to fix this the best way they can in order to keep economic chains going, however they can't do that forever. What in the end is likely to produce cracking of entire system, which we are actually seeing in practice over the years.

That is a good economic analysis although I still think that the degeneracy of elites will kill it all quicker than a debt crisis. Any real debt crisis has been proven to be exploitable by the same set of rich thugs in the UK to simply further their designs, which as you say at the moment are akin to gambling.

Its almost as though the whole neo-liberal thing has just been a useful fiction for a bunch of people desperate to keep the cocaine supply flowing.

For instance, everyone's excited at the moment about the UK's willingness to break international law in its dealings with ROI and the EU. Who do you think has engaged in the most amazing crime syndicate crack down and elimination of drugs trafficking and cocaine supply in years? The ROI. Coincidence? Well, I doubt it.

 

[Lark]

[MENTION=4347]Virtual ghost[/MENTION] & [MENTION=7280]Lark[/MENTION]
I still think that this might be leading to collapse of governments and a change to a world ruled by corporations. There are not much fictions on this, but there a few science fiction stuff out there (like Final Fantasy VII and Resident Evil) where corporations rule the world, so visualizing this might be hard if you didnt ever had a contact with any.

That is what the neoliberals want in a more extreme way, it doesnt actually leads to anarchy (even if they make appear so so they can have some happy ancaps thinking that they can do whatever they want when governments gets down), but instead to a corporate-ruled capitalism with no state at all.

The key thing to the debt is the interest rate: We do not even know if there would be a debt if it had no interest rate at all (by no interest rate I just mean inflation corrections). I think these debts will grow with time to the point where, if the government sells everything, it would still be in debt, so they can declare the bankruptcy of the government. So the end point should be some point where the government might end privatizing everything (privatize is the word for government selling itself here). I think we are sort of in transition to the corporate-ruled world where the new kings will be the corporate owner slowly. I hope I dont look crazy here, but, if we stop to think about, that is already happening. If we think, for example, in terms of data, a few decades ago, the governments had the most data about regular citizens. Today, its the corporation, Google as a company probably knows significantly more about me than my government. As I had stated, the rich already indirectly use the tax to take money away from the average Joe already (tax money goes to government, government has to pay the high interest rates) and as you noted government already send money to corporations right from tax payers from time to time (pay attention that what is a crisis to the regular Joe might no be a crisis at all to superrich corporations). These crisis should get more intense from time to time, with governments getting smaller and smaller with bigger and bigger debts and with bigger and bigger taxes (I think wealth tax is increasing overtime in general, from what I had a look on OCDE website; This increase should be caused by the debt), until they get bankrupt, but on that point the average people will be so used into paying a high tax that wont return (because it is actually being bombed to the corporations by the interest rate of the debt, but they should use the argument "government is inefficient" to make it weaker instead).

I know that officially and formally, a government cant bankrupt, so it wont be literal bankruptcy, but it should be instead the government slowly giving up influences, which should be happening already, combined with the government losing its "rights" in the future (like, for example, making room for the corporations to indirectly do their own law; Perhaps the deregulation serves to that).

That is what I think it is going to happen. I think the crisis will be there for us; But for corporations, just more and more profits, and the lesser the welfare state government, more money will speak for power instead of anything else. All I said here probably matches with facts: More privatizing, wealth and citizen taxes growing with time, more public spending to pay the debts that always grows, increase on Gini and the deregulation on the top of that. Deregulation on an environment with low Gini and plenty opportunities for the average people does indeed causes more freedom, and they will sell it as that, but deregulation on environment with a high inequality and low opportunities for the average people just make room for the big corporations to actually set the rule. The market rules, and the corporations rules the market (on a high inequality country, that does work). Of course, the corporation ruling the world wont be obvious as it is on some fictions like Final Fantasy VII, but more like on Resident Evil where Umbrella Corporation have big secret installations (with the absence of government they have the right to do that, although in Resident Evil they probably just cheated), and that is the true invisible hand controlling the market.

That's interesting.

I think privatization is an idea which should have been exposed as short sighted or containing some sort of obsolescence long before now, public assets "fire sales" which translate into tax breaks for politicians, the legacies, corporate friends cant go on forever, as you say.

The politicians are out of ideas, I think this has been the case for a long time. Neo-liberalism to most of them wasnt something other than a "useful fiction", it grabbed peoples attention for a while (although I would say that it was the aggressive, authoritarian government that often accompanied it which had appeal for a lot of people). At least this has been the case with most conservative parties globally, which I think have moved on to something else, its largely an unchanged script, I mean they defend privilege first and foremost.

The most neo-liberal party in office in the UK since I've been alive has probably been Tony Blair's Labour Party, since they were prepared to look at policies which would effect the business cycle, money circulating in the economy etc. but it was very ill understood by a lot of people, a lot of it was done by stealth and in the final instance, since it did involve change to the distribution of wealth, at least in the short term, it got dismissed as just more "free money tax and spend".

The corporations may seem like winners but I think the politicians are still in charge, the irony of Hayek's Road To Serfdom is that he was complaining about socialism and socialist politicians and what he thought those things would amount to has played out but it has been conservative politicians, largely, who've done it. Some of them are definitely corrupt, some just think its the reality of politics, or at least have that excuse, and either way it results in the empowering of corporations.

Although, I still think the role of organized crime, dark money, drugs trafficking and modern day slavery play their part. Greater than is ever likely to be acknowledged publically anyway.

 

[Virtual ghost]

[MENTION=4347]Virtual ghost[/MENTION] & [MENTION=7280]Lark[/MENTION]
I still think that this might be leading to collapse of governments and a change to a world ruled by corporations. There are not much fictions on this, but there a few science fiction stuff out there (like Final Fantasy VII and Resident Evil) where corporations rule the world, so visualizing this might be hard if you didnt ever had a contact with any.

That is what the neoliberals want in a more extreme way, it doesnt actually leads to anarchy (even if they make appear so so they can have some happy ancaps thinking that they can do whatever they want when governments gets down), but instead to a corporate-ruled capitalism with no state at all.

The key thing to the debt is the interest rate: We do not even know if there would be a debt if it had no interest rate at all (by no interest rate I just mean inflation corrections). I think these debts will grow with time to the point where, if the government sells everything, it would still be in debt, so they can declare the bankruptcy of the government. So the end point should be some point where the government might end privatizing everything (privatize is the word for government selling itself here). I think we are sort of in transition to the corporate-ruled world where the new kings will be the corporate owner slowly. I hope I dont look crazy here, but, if we stop to think about, that is already happening. If we think, for example, in terms of data, a few decades ago, the governments had the most data about regular citizens. Today, its the corporation, Google as a company probably knows significantly more about me than my government. As I had stated, the rich already indirectly use the tax to take money away from the average Joe already (tax money goes to government, government has to pay the high interest rates) and as you noted government already send money to corporations right from tax payers from time to time (pay attention that what is a crisis to the regular Joe might no be a crisis at all to superrich corporations). These crisis should get more intense from time to time, with governments getting smaller and smaller with bigger and bigger debts and with bigger and bigger taxes (I think wealth tax is increasing overtime in general, from what I had a look on OCDE website; This increase should be caused by the debt), until they get bankrupt, but on that point the average people will be so used into paying a high tax that wont return (because it is actually being bombed to the corporations by the interest rate of the debt, but they should use the argument "government is inefficient" to make it weaker instead).

I know that officially and formally, a government cant bankrupt, so it wont be literal bankruptcy, but it should be instead the government slowly giving up influences, which should be happening already, combined with the government losing its "rights" in the future (like, for example, making room for the corporations to indirectly do their own law; Perhaps the deregulation serves to that).

That is what I think it is going to happen. I think the crisis will be there for us; But for corporations, just more and more profits, and the lesser the welfare state government, more money will speak for power instead of anything else. All I said here probably matches with facts: More privatizing, wealth and citizen taxes growing with time, more public spending to pay the debts that always grows, increase on Gini and the deregulation on the top of that. Deregulation on an environment with low Gini and plenty opportunities for the average people does indeed causes more freedom, and they will sell it as that, but deregulation on environment with a high inequality and low opportunities for the average people just make room for the big corporations to actually set the rule. The market rules, and the corporations rules the market (on a high inequality country, that does work). Of course, the corporation ruling the world wont be obvious as it is on some fictions like Final Fantasy VII, but more like on Resident Evil where Umbrella Corporation have big secret installations (with the absence of government they have the right to do that, although in Resident Evil they probably just cheated), and that is the true invisible hand controlling the market.

Now we are coming into the dimension of cultural differences. For your post colonial society this could be true in all the talking points. However I am not sure that holds true for the entire world and that has large implications for the whole story. You were probably risen in the environment where becoming rich is the very important goal in life, while I am from where you should survive and use any means necessary to do so. In other words here the money isn't sacred and most people don't believe that debts should be paid in all circumstances. After all I have a country full of people that didn't pay their mortgage debt and they all got to keep their properties. How did that happen ? They overthrow the entire political order in the nationalistic revolution. While now we are again making laws that prevent evictions. Also here we currently starting the trial of the century. Since clearly the richest man in the country has to answer for some games that involve billions. What basically got possible since the people simply boycotted him and then the bubble burst. However this got to this point because he was scamming people (mostly family farms), while it was also kinda obvious that he is buying politicians. So the people took him down without much pardon.



In other words power of corporation is coming out of governments. But if those governments go bankrupt or people go rogue on the entire system the whole system brakes. What is exactly what tends to happen when things get too dystopian. The only way corporations can survive is by becoming governments but in that case they are no longer just corporations. Plus this doesn't make them much less vulnerable to revolt or even invasion. Since neoliberal order is pretty socially loose/deregulated in many regards and therefore it can be vulnerable to direct punch. Especially if they have completely undone the government part. In a way this is exactly why China is spreading fast across the world, since corporations have created a power vacuum. Which more solid structure can quickly fill in. Because in China people play more of a co-op in practical sense, instead of everyone for himself and therefore they can easily overpower less structured societies. Especially since they will be able to suck in the whole corporations into their new order. What is basically exactly what stands behind my sentences that neoliberal private sector is also exploding in debt and often is going bankrupt. Since it is losing ground in market sense and in the physical sense. In other words here we a moving towards government control instead of private corporate control over the last few years, since China and Russia as governments are on shopping spree around the region. While the west doesn't really have the money or perhaps even will to balance this out. So yeah, I don't give your corporate dystopia too many chances since there are odds that various counters will snowball against it if you go to far with deregulations. Therefore the irony is that if private corporations want to survive they have to start building their own "solid structure". Since everyone in this world is fundamentally replaceable. What returns us to cultural issues from the start of the story: trade vs. government/military.

 

[Virtual ghost]

That is a good economic analysis although I still think that the degeneracy of elites will kill it all quicker than a debt crisis. Any real debt crisis has been proven to be exploitable by the same set of rich thugs in the UK to simply further their designs, which as you say at the moment are akin to gambling.

Its almost as though the whole neo-liberal thing has just been a useful fiction for a bunch of people desperate to keep the cocaine supply flowing.

For instance, everyone's excited at the moment about the UK's willingness to break international law in its dealings with ROI and the EU. Who do you think has engaged in the most amazing crime syndicate crack down and elimination of drugs trafficking and cocaine supply in years? The ROI. Coincidence? Well, I doubt it.

Well for me the debt crisis actually is the outcome of the degeneracy. Almost all structures are quite loosened and that is tearing down the system, that at this point has way too many holes in the terms of the sustainability. Since someone forgot that there is something called reality, which has it's laws and facts. While for me drugs aren't fundamentally a part of neoliberalism. They are more of a fungus that is growing out of the economic corpses and misery.

 

[Vendrah]

Now we are coming into the dimension of cultural differences. For your post colonial society this could be true in all the talking points. However I am not sure that holds true for the entire world and that has large implications for the whole story. You were probably risen in the environment where becoming rich is the very important goal in life, while I am from where you should survive and use any means necessary to do so. In other words here the money isn't sacred and most people don't believe that debts should be paid in all circumstances. After all I have a country full of people that didn't pay their mortgage debt and they all got to keep their properties. How did that happen ? They overthrow the entire political order in the nationalistic revolution. While now we are again making laws that prevent evictions. Also here we currently starting the trial of the century. Since clearly the richest man in the country has to answer for some games that involve billions. What basically got possible since the people simply boycotted him and then the bubble burst. However this got to this point because he was scamming people (mostly family farms), while it was also kinda obvious that he is buying politicians. So the people took him down without much pardon.



In other words power of corporation is coming out of governments. But if those governments go bankrupt or people go rogue on the entire system the whole system brakes. What is exactly what tends to happen when things get too dystopian. The only way corporations can survive is by becoming governments but in that case they are no longer just corporations. Plus this doesn't make them much less vulnerable to revolt or even invasion. Since neoliberal order is pretty socially loose/deregulated in many regards and therefore it can be vulnerable to direct punch. Especially if they have completely undone the government part. In a way this is exactly why China is spreading fast across the world, since corporations have created a power vacuum. Which more solid structure can quickly fill in. Because in China people play more of a co-op in practical sense, instead of everyone for himself and therefore they can easily overpower less structured societies. Especially since they will be able to suck in the whole corporations into their new order. What is basically exactly what stands behind my sentences that neoliberal private sector is also exploding in debt and often is going bankrupt. Since it is losing ground in market sense and in the physical sense. In other words here we a moving towards government control instead of private corporate control over the last few years, since China and Russia as governments are on shopping spree around the region. While the west doesn't really have the money or perhaps even will to balance this out. So yeah, I don't give your corporate dystopia too many chances since there are odds that various counters will snowball against it if you go to far with deregulations. Therefore the irony is that if private corporations want to survive they have to start building their own "solid structure". Since everyone in this world is fundamentally replaceable. What returns us to cultural issues from the start of the story: trade vs. government/military.

Well, you have some good points that doesnt show me that I am wrong, but instead that I am oversimplifying since I indeed didnt paid attention to China influence and that cultural background can give some changes (although I seem to be accurate on the average american country).
However, I have a perception that China corporations power should be slowly growing, although they are quite far from being disproportionately high. And perhaps its Chinese corporation - and not chinese government - that is doing the shopping you refer to.

Anyway, I dont think there is really a big power vacuum, and it is important to remember, as [MENTION=7280]Lark[/MENTION] pointed, that neoliberalism usually goes together with conservatism and authoritanism, and conservatism is anti-China in many places. At the same time we have people boycotting the billionaire you mention, there is also more and more people boycotting China, especially now in pandemic's time. The conservatism movement can work to suppress the chinese to fill the power vacuum, and, also, perhaps except for the dumb neoliberals, all others knows that it would be too stupid to end the state from day to night. They know that if the state goes bankrupt in a single day, chaos will show up. But the state slowly and strategically dying exactly by the way they need it to die in a slow pace that takes decades changes everything, since they can still use the state to block China while giving enough time to corporations to fill the power vacuums left by the state retreat.

And I also have a hard time screening both private sector and public sector in debt all over the world. Because if somebody has a debit to pay, someone out there must have a credit to receive. Unless the neoliberals manage to have chinese and the few communist countries left as investors, which I have a very hard time believing that would ever happen, someone will be on credit and not on debt.

I think the military part is really the "?" of the story. I can easily think that the corporations could still assume the military part as they do in some fiction, or that perhaps they might keep instead a minimum state military government, probably with fascism (it was done in Chile once), with the state being in charge of only securing territories to prevent the chinese advancement, with the corporations probably controlling the military technology in one way or another. This hypothesis of a minimum military state with some fascism but lots of "market/commerce freedom" quite matches what conservative neoliberals wants (conservatives on "life traditions" and liberal on economy; Or, in other words, freedom to the market and no freedom to the citizens unless that means freedom to the market too) and it does fix all the issues you pointed out. Im not actually giving new ideas here, since both of you already noted the connections that neoliberalism can and sometimes does with fascism (in Latin America, it did happen with Chile).

What can really happen is that, although some of few countries might try to resist it, this could lead a new cold war, that might perhaps will look like US vs China, but it is rather the corporations with US government assist VS China. And, since your country is pretty small, chances is that either the chinese and the corporations are going to try to control and change your way of life there.

But as I said and reinforce, "my corporation dystopia" is not exaggerated dystopian as they are in fiction but still real, it is not obvious and the control of corporations might not be obvious in order to prevent revolts, but they should still be there. And as I had mention, my read on data on last week really led me to later think that the world is heading in this direction and that should be the main thread about these public debts, either them being spontaneous (which I dont really think they are) or provoked to destroy or severely handicap the state.

The corporations may seem like winners but I think the politicians are still in charge

Actually, the neoliberalism is centered in the duel of market vs state and see them as indirect competitors and not as entities that can really cooperate with each other, which for my point I would rephrase as corporations vs states, and not politicians vs states. A politician can be a super rich corporate owner or to serve them (Donald Trump is one example of a corporate super rich guy that is also a politician).

Although, I still think the role of organized crime, dark money, drugs trafficking and modern day slavery play their part. Greater than is ever likely to be acknowledged publically anyway.

I think you got it right on the modern day slavery, dark money, sort of on organized crime, but wrong on drugs trafficking. Conservative neoliberals are in average anti-drug dealing; However, the fact that they usually goes to increase Gini and social inequality does connects with modern day slavery, since slavery is not truly something black and white as we think, so i would rather cal semi-modern day slavery instead. And dark money actually connects with de-regulations, so connecting with dark money makes sense.

 

[Virtual ghost]

Well, you have some good points that doesnt show me that I am wrong, but instead that I am oversimplifying since I indeed didnt paid attention to China influence and that cultural background can give some changes (although I seem to be accurate on the average american country).
However, I have a perception that China corporations power should be slowly growing, although they are quite far from being disproportionately high. And perhaps its Chinese corporation - and not chinese government - that is doing the shopping you refer to.

Anyway, I dont think there is really a big power vacuum, and it is important to remember, as [MENTION=7280]Lark[/MENTION] pointed, that neoliberalism usually goes together with conservatism and authoritanism, and conservatism is anti-China in many places. At the same time we have people boycotting the billionaire you mention, there is also more and more people boycotting China, especially now in pandemic's time. The conservatism movement can work to suppress the chinese to fill the power vacuum, and, also, perhaps except for the dumb neoliberals, all others knows that it would be too stupid to end the state from day to night. They know that if the state goes bankrupt in a single day, chaos will show up. But the state slowly and strategically dying exactly by the way they need it to die in a slow pace that takes decades changes everything, since they can still use the state to block China while giving enough time to corporations to fill the power vacuums left by the state retreat.

And I also have a hard time screening both private sector and public sector in debt all over the world. Because if somebody has a debit to pay, someone out there must have a credit to receive. Unless the neoliberals manage to have chinese and the few communist countries left as investors, which I have a very hard time believing that would ever happen, someone will be on credit and not on debt.

I think the military part is really the "?" of the story. I can easily think that the corporations could still assume the military part as they do in some fiction, or that perhaps they might keep instead a minimum state military government, probably with fascism (it was done in Chile once), with the state being in charge of only securing territories to prevent the chinese advancement, with the corporations probably controlling the military technology in one way or another. This hypothesis of a minimum military state with some fascism but lots of "market/commerce freedom" quite matches what conservative neoliberals wants (conservatives on "life traditions" and liberal on economy; Or, in other words, freedom to the market and no freedom to the citizens unless that means freedom to the market too) and it does fix all the issues you pointed out. Im not actually giving new ideas here, since both of you already noted the connections that neoliberalism can and sometimes does with fascism (in Latin America, it did happen with Chile).

What can really happen is that, although some of few countries might try to resist it, this could lead a new cold war, that might perhaps will look like US vs China, but it is rather the corporations with US government assist VS China. And, since your country is pretty small, chances is that either the chinese and the corporations are going to try to control and change your way of life there.

But as I said and reinforce, "my corporation dystopia" is not exaggerated dystopian as they are in fiction but still real, it is not obvious and the control of corporations might not be obvious in order to prevent revolts, but they should still be there. And as I had mention, my read on data on last week really led me to later think that the world is heading in this direction and that should be the main thread about these public debts, either them being spontaneous (which I dont really think they are) or provoked to destroy or severely handicap the state.

In that case you should look for stuff like money printing, how electric/digital money works etc. With all modern means you can really create huge debts with money that is "fictional". Huge parts of the world are run on nothing more than cheap credit and low interest rates. However this can't work as the ultimate solution. Since making up money that is right away turned into someones debt will eventually run the debt through the roof in most countries and places. So it is enough that some regions fail and that will be causing huge mess in the system all over the map. What is basically the main problem with the current pandemic, since it broke way too many economic chains. Corporations run on the market and fundamentally can't survive without it. However if they can that means that they have basically become a government.



On the other hand my country isn't small at all and it has something like two times more people than yours. Since truth to be told my country in practice is EU. Since EU fits something like at least 80% of the criteria needed to be a country. It has it's own currency, it's own parliament and elections (and laws), it's own central bank, military got founded recently, it has it's own anthem, there is transfer of wealth between countries, it does have huge borderless zone in itself and outer borders, it has it's own diplomacy ... etc. So the whole thing is more like a very federalized large country than a conglomerate of separate countries. Therefore regardless of what some people may think about the issue EU is more of country than not. But EU itself has some limitations on corporate power that are fundamentally in the system. From personal data protection, consumer protection, a number of guarantees in life, environment protection etc. However that power is coming from people the most and that is why it is hard to replace it fully. Since people know that it is possible to have a normal life and the system that provides it. True, EU has it's own corporations but they aren't hard core neoliberal for the most part. Since the whole system isn't build on the basis of colonialistic anarco-capitalism. Because ethics and order do have a say in how things are run. However since the system is big it has a chance of floating as a independent body on the global stage. What was kinda the point, that you have community where you set your your own rules.



In other words it seems that someone recently pressed the red alert button regarding China and it's allies. So we will see where this will go, since the ties are cracking or at least they are being under rethinking. Therefore the most likely scenario is alliance with US against China. However in such global economic war the corporations are to be one of the largest losers, since the global free trade is getting limited, because spheres of influences are being set up. In other words modern neoliberalism was possible only because China and it's satellites/friends lowered the price of work and benefits so much that only slavery was profitable business model. Plus mass outsourcing really hurt certain regions and with these global changes neoliberalism should change. Since China that lowered pretty much all economic and environmental criteria will probably be nudged out of the central focus through new cold war.

 

[Vendrah]

In that case you should look for stuff like money printing, how electric/digital money works etc. With all modern means you can really create huge debts with money that is "fictional". Huge parts of the world are run on nothing more than cheap credit and low interest rates. However this can't work as the ultimate solution. Since making up money that is right away turned into someones debt will eventually run the debt through the roof in most countries and places. So it is enough that some regions fail and that will be causing huge mess in the system all over the map. What is basically the main problem with the current pandemic, since it broke way too many economic chains. Corporations run on the market and fundamentally can't survive without it. However if they can that means that they have basically become a government.



On the other hand my country isn't small at all and it has something like two times more people than yours. Since truth to be told my country in practice is EU. Since EU fits something like at least 80% of the criteria needed to be a country. It has it's own currency, it's own parliament and elections (and laws), it's own central bank, military got founded recently, it has it's own anthem, there is transfer of wealth between countries, it does have huge borderless zone in itself and outer borders, it has it's own diplomacy ... etc. So the whole thing is more like a very federalized large country than a conglomerate of separate countries. Therefore regardless of what some people may think about the issue EU is more of country than not. But EU itself has some limitations on corporate power that are fundamentally in the system. From personal data protection, consumer protection, a number of guarantees in life, environment protection etc. However that power is coming from people the most and that is why it is hard to replace it fully. Since people know that it is possible to have a normal life and the system that provides it. True, EU has it's own corporations but they aren't hard core neoliberal for the most part. Since the whole system isn't build on the basis of colonialistic anarco-capitalism. Because ethics and order do have a say in how things are run. However since the system is big it has a chance of floating as a independent body on the global stage. What was kinda the point, that you have community where you set your your own rules.



In other words it seems that someone recently pressed the red alert button regarding China and it's allies. So we will see where this will go, since the ties are cracking or at least they are being under rethinking. Therefore the most likely scenario is alliance with US against China. However in such global economic war the corporations are to be one of the largest losers, since the global free trade is getting limited, because spheres of influences are being set up. In other words modern neoliberalism was possible only because China and it's satellites/friends lowered the price of work and benefits so much that only slavery was profitable business model. Plus mass outsourcing really hurt certain regions and with these global changes neoliberalism should change. Since China that lowered pretty much all economic and environmental criteria will probably be nudged out of the central focus through new cold war.

Can you explain me how is it possible for a debt to exist without a respective credit?
What I mean is... If I give you $500 as a loan, then you have a debt of $500 with me and I have a $500 credit with you. By the way you say it, it is as if the money from the debt after paid goes to nobody's pocket, or to a black hole.

Bold: If you think that what you had described is something that already start happening, then I think what you said in bold is incorrect. The inequality in the world is increasing; Bilionaries got even richer during the pandemic, for example, so the corporations arent really losing, they are actually "winning". I say corporations in general; Its seems normal a few bankruptcy here and there.

The low price of work is not something exclusive for chinese; There is too on Latin America, perhaps Africa, even if Africa is inconvenient but also on some parts of Asia as well.

And count Europe as a whole as a country is sort of cheating hehehehehe, but I got your point.

 

[Virtual ghost]

Can you explain me how is it possible for a debt to exist without a respective credit?
What I mean is... If I give you $500 as a loan, then you have a debt of $500 with me and I have a $500 credit with you. By the way you say it, it is as if the money from the debt after paid goes to nobody's pocket, or to a black hole.

Bold: If you think that what you had described is something that already start happening, then I think what you said in bold is incorrect. The inequality in the world is increasing; Bilionaries got even richer during the pandemic, for example, so the corporations arent really losing, they are actually "winning". I say corporations in general; Its seems normal a few bankruptcy here and there.

The low price of work is not something exclusive for chinese; There is too on Latin America, perhaps Africa, even if Africa is inconvenient but also on some parts of Asia as well.

And count Europe as a whole as a country is sort of cheating hehehehehe, but I got your point.

Regarding the bolded part, such large economic war didn't fully started yet and in a way we are all waiting for US to sort out it's elections. Plus just if some billionaires got richer during the pandemic that doesn't mean that uncontrolled corporatism is looking at rosy picture. The first reason for that is obvious: this is creating visible outrage all over the map. Especially since at the end of the day corporation have their foundations in the common people that tend to rot in many places. While most governments simply don't have the money anymore to save corporations on every turn. So my argument is future based, not "here and now" based. Also if the world is going into one large trade war between east and west that is also reducing corporate power. Since that means that there will be zones of influence, what puts control on their power of free trade. So many of them could lose both large chunk of their customers and their present workforce. The reasons why I presented China as the biggest imploder of economic standard is because they are the world leader in creation of physical good and they are very authoritarian at the same time. So everyone has to get close to their standards to be competitive in manufacturing. Therefore if China gets phased out, the whole game will change in a number of important ways.



Also I don't think we understood each other regarding the credit. The thing is that if someone is just printing money all the time it creates extra money with which you can rise debt further than in the case there is no new money in the play. However in doing this you are creating so large balloon of debt that it becomes questionable if it will ever be repaid. Especially since the interest rates are pilling on each other to the degree that paying for the original debt becomes really hard. While on the other hand you have global market and your can't really stop since in that case you collapse. So you take even more of the cheap just printed credit and hope that things will improve. While that is not happening since the whole thing is ballooning even further until one day the whole thing will pop. In a way this is exactly why we are heading towards major global economic war, since that will reduce competition and remake some for the environment from a few decades ago. However those that are doing business all over the map are likely to be caught in cross fire.


Yes Europe as a single country is cheating in a way but it is working fairly well for the continent if you watch the big picture. But as I said a number of times EU is a product of pragmatism, not idealism. Plus all over the block you have active movements to reduce or regulate corporate power, both on the left and on the right. As the joke goes: US invents, China copies, EU regulates.

 

[Vendrah]

Regarding the bolded part, such large economic war didn't fully started yet and in a way we are all waiting for US to sort out it's elections. Plus just if some billionaires got richer during the pandemic that doesn't mean that uncontrolled corporatism is looking at rosy picture. The first reason for that is obvious: this is creating visible outrage all over the map. Especially since at the end of the day corporation have their foundations in the common people that tend to rot in many places. While most governments simply don't have the money anymore to save corporations on every turn. So my argument is future based, not "here and now" based. Also if the world is going into one large trade war between east and west that is also reducing corporate power. Since that means that there will be zones of influence, what puts control on their power of free trade. So many of them could lose both large chunk of their customers and their present workforce. The reasons why I presented China as the biggest imploder of economic standard is because they are the world leader in creation of physical good and they are very authoritarian at the same time. So everyone has to get close to their standards to be competitive in manufacturing. Therefore if China gets phased out, the whole game will change in a number of important ways.



Also I don't think we understood each other regarding the credit. The thing is that if someone is just printing money all the time it creates extra money with which you can rise debt further than in the case there is no new money in the play. However in doing this you are creating so large balloon of debt that it becomes questionable if it will ever be repaid. Especially since the interest rates are pilling on each other to the degree that paying for the original debt becomes really hard. While on the other hand you have global market and your can't really stop since in that case you collapse. So you take even more of the cheap just printed credit and hope that things will improve. While that is not happening since the whole thing is ballooning even further until one day the whole thing will pop. In a way this is exactly why we are heading towards major global economic war, since that will reduce competition and remake some for the environment from a few decades ago. However those that are doing business all over the map are likely to be caught in cross fire.


Yes Europe as a single country is cheating in a way but it is working fairly well for the continent if you watch the big picture. But as I said a number of times EU is a product of pragmatism, not idealism. Plus all over the block you have active movements to reduce or regulate corporate power, both on the left and on the right. As the joke goes: US invents, China copies, EU regulates.

I had waited days to see if somebody else stumbled on the thread, but that didnt happen.

I think for my own happiness that you "won" the argument against my global corporation dystopia, because of China and Europe. However, do you think it does apply to America? And I mean the whole America, from North Canada to South Argentina, perhaps except Cuba. And if you do, what you think would be the consequences?

Anyway, I partially created this thread because I am looking for future predictions...
In the last years I havent been bad at predicting the short-term future for Brazil, and by short term I mean a year or two later (not the long term lol), but I havent been able to do it for next year and not even the end of this year. The inflation that is happening know I had predicted 2 months ago and could do it in 4 if I was more attentive.

 

[Virtual ghost]

I had waited days to see if somebody else stumbled on the thread, but that didnt happen.

I think for my own happiness that you "won" the argument against my global corporation dystopia, because of China and Europe. However, do you think it does apply to America? And I mean the whole America, from North Canada to South Argentina, perhaps except Cuba. And if you do, what you think would be the consequences?

Anyway, I partially created this thread because I am looking for future predictions...
In the last years I havent been bad at predicting the short-term future for Brazil, and by short term I mean a year or two later (not the long term lol), but I havent been able to do it for next year and not even the end of this year. The inflation that is happening know I had predicted 2 months ago and could do it in 4 if I was more attentive.

Well in my worldview things are likely to get fairly dystopian even without corporation at every helm. The ratios between global population and climate change even in the best case scenario indicate a bumpy ride. The dictatorships are in the general rise over the lest 10 years ... etc. So a person needs to look at much larger picture then just money to get what is actually the big picture. Which is so complex that you can write the whole books about it.



However regarding America's I am not fully sure. Since both of the continents are fairly stuck in their colonial ideas that don't work too well with various modern technologies and realities. Therefore if for a number of reasons US goes into genuine decline of power the intellectual center of the western world will probably return back to Europe. Which lost that throne due to very bad 20th century. So if EU really manages to consolidate we would have a world kinda similar to 2000 years ago, where Roman Empire and China are the dominant players. However since it isn't too likely that US will completely implode you will probably have some kind of a trans-atlantic partnership against authoritarian countries. What returns us to Latin America that is likely to be a "battleground" between west and east. Therefore it's faith will probably mostly be defined by who wins the east west divide. But to some degree it will depend on who will be stronger western power: US or EU. US scenario means that post colonial logic will continue even if larger improvements are possible. While if the EU will be the dominant power the system will probably drift towards EUs social democracy. What should really improve this part of the world since it will create structure that Latin America really seems to be lacking. While if China wins there will be plenty of textbook autocrats popping all over the place. I mean it is perhaps possible that Latin America becomes it's own pole in the world but I don't see this coming as realistic at this point. Since someone will surely have a strong influence there, because the region just lags in too many things and it is pretty messy in legal and political sense. What is the foundation that you can stand on your own in the world. However the world is at the big crossroads and it is hard to predict the details of what will exactly happen.