US Economics and Theory of Collapse

Note: Italics comments by another
 Unless they (US) fall hopelessly behind in tech, they are ‘built’ to perpetually retain a competitive shot.

I think you have not looked at the grim economic statistics

Off the top of my head

Debt: 30+ Trillion
Interest on Debt: Trillion
Budget Deficit: 1.8 Trillion (2024)
Trade Deficit: 140.5 billion (Too much imported)
Defense Budget: 1 Trillion

Moody just downgraded US debt from to Aa1 from Aaa.

They had to, could not ignore as USA sovereign CDS (Credit Default Swaps) were trading wider than China and Greece. i.e. US debt default more likely than China and Greece

I wouldn’t go that far. USA has inherent geographic advantages that almost assure competitiveness. Energy, food, water independence are non-trivial advantages._

A big YES and agreed

However, the US has dug itself a huge economic hole among other debilitating factors.
However, to get out of the hole they need

a) Austerity (reduce imports and pay down debt)
b) Reduce defense Budget
c) Invest in Manufacture and Self Sufficiency

To do above needs a complete system change and political suicide in the current system.

A little bit of theory from Collapse of Complex Societies by Joseph A. Tainter

Tainter logically builds his case that the “Law Of Diminishing Returns” is the root cause of collapse since this law grows more and more impactful as societies increase in complexity to support growing populations. Eventually this cost burden becomes so great and the returns so small that the society collapses. I totally agree with the case he makes that as civilizations are driven toward ever more complexity to support an ever growing population the law of diminishing returns rears its ugly head ever more higher. Even maintenance of existing infrastructure eventually succumbs to this law.

Examples from reviews in Good Reads
Similar to economic law of marginal product and average product–
eventually, increased investment into sociopolitical complexity
becomes costly and unprofitable.

Main concepts are: 
1) human societies are problem­ solving organizations, 
2) sociopolitical systems need energy to maintain themselves, 
3) increased complexity →increased costs per capita, 
4) investment in sociopolitical complexity as problem­ solving response often reaches point of declining marginal returns.

Example Information processing

Declining returns into investment in R&D, with patent applications per capita and per technical worker in USA falling fast from 1870 to 1950, because of

a) declining productivity of inventing,
b) decline in proportion of patentable inventions,
c) decline in propensity to patent.

More technical workers, patents about constant per year, 
spending on R&D up from 0.1% of GDP in 1900 to 2.6% in 1960. Medicine: 1930, 3.3%
on health for 59.7 years; 1982, 10.5% for 74.5, today, 16% for 78.

Between 1870 and 1960, proportion of 18­21 year olds in US in higher education 1.7% → 33.5%; from 0.26% of GDP in 1900 to 1.23% in 1960; #of students per faculty from 12.8 in 1900 to 9.5 in 1958, longer and more specialized courses – but “learning that occurs yields decreased general benefits for greater costs” (most learning is during infancy).

(PS. Korotayev insight that key is 4 years and literacy – makes industrial workforce). Decreasing average and marginal returns as those now educated are closer to center of IQ bell curve.

Explaining declining marginal rates in Science
“Planck's Principle of Increasing Effort” ­ “with every advance [in science] the difficulty of the task is increased”, can no longer make discoveries by peering into homemade microscopes of flying a kite in a thunderstorm. (PS. AI, IT, cellular automata). 
“
Exponential growth in size and costliness of science, in fact, is necessary simply to maintain a constant rate of progress”. Rescher: “In natural science we are involved in a technological arms race: with every 'victory over nature' the difficulty of achieving the breakthroughs which lie ahead is increased


Collapse of Complex Societies by Joseph A. Tainter
https://www.amazon.com/Collapse-Complex-Societies-Studies-Archaeology/dp/052138673X/

Sri Lanka and China ties post WWII

 
Wrote this as reply on a South Asian Blog re Sri Lankas China leanings questioned by Indian readers. Did not mention the obvious China has not trained and funded terrorists against Sri Lanka, unlike India.

Replying to Naveen and Sumits comments. 

Sumit: i don’t understand the level of simping for China in SL
Naveen: SL have done the China leaning game for a couple decades. So what changed now?

The big geopolitical change is China has gone from being the US cheap labor manufacturing source to a big time competitor.  Even the prime enemy as per Biden>  So the US is trying to stop Chinas influence wherever.  It was little too late when US (and India) realized China had cornered the very strategic Hambantota port.

We have been buddies with China for ages. Specially in 1970's during Srimavo Bandaranaike's time.  That time too we had a foreign currency shortage  It was a really bad time. I was about 12 and we had to stand in line for hours to get bread, rice/dhal/wheat flour on rations. Forced austerity, and we became self sufficient in about 5 years.  However, people wanted the imported freebies and gave a 2/3rd majority to the West leaning JR Jayawardene in 1977.  With that an open liberal economy.  Also the 1977 and 1983 pogroms, the burning of the Jaffna Library..  

China came to the rescue during those hard times with the rubber rice pact. Again bypassing dollar transaction. In comparison the US gave us moldy surplus wheat flour on credit. I and Sri Lankans had to eat that bread on ration.  It was moldy and with maggots, gullo  look up PL 480).

The first China Rice Rubber pact was in 1952 when the very West leaning Dudley Senanayake was the PM. SL (Ceylon then) had foreign exchange crisis in 1952 caused by a dramatic fall in her export prices brought about by the quick end of the Korean War boom. The end of the Korean War and the drastic reduction of commodity purchases by the West – in particular, of natural rubber by the United States.
China was unable to obtain rubber as a result of prohibition of rubber exports from Malaya following a UN resolution preventing the sale of rubber to China. The American Government invoked the Battle Act which prevented it from giving aid to countries selling strategic materials to Communist countries and cut off aid to Sri Lanka. In addition, US stopped selling sulphur needed by Sri Lanka’s rubber plantations. This was the price that had to be paid for trading with China.

R. G. Senanayake Minister of Commerce in 1952 said: "We noted on the Chinese side the absence of the spirit of bargaining and haggling on comparatively small points. On the other hand, they gave us the impression of being large minded and forthright in their dealings"

The trade was based on barter – exports and imports to balance every year; only the outstanding balance at the end-of-the-year was to be settled in foreign exchange.

Trade however was rarely balanced in the following years but the outstanding balance was generally carried forward to the next year without settlement in foreign exchange.

When Srimavo went to China in 1963 she was given a World Leaders welcome (see video link below).  I wonder if the Chinese even then were thinking the long game.

Sumit: could raise the funds no strings attached via market borrowings at the same cost why would it need China and it’s restrictive loans?
extract its pound of flesh via geopolitical gains,
China has never pressurized SL about debt repayments.. Neither are the loans restrictive. It is IMF, ADB loans (9.5 million, 27%) that are extremely restrictive. In 2017 West leaning Ranil wanted loans/handouts to fund consumption/imports for local political gain. He wanted to be President. The West US did not oblige. So he went to China. The only thing China wanted was the Hambantota lease.  That money (about a USD billion) was used in consumption, not to pay any Chinese Debt. 

We cant raise at same cost from market borrowings because of  Rating downgrades

Sumit: if I remember correctly, the Chinese debt closer to 20% because some got transferred to state owned
Chinese loans, bilateral, commercial whatever are around 10%.  See the erd.gov.lk link above.

yeah propaganda.  In one place I saw the statement "Chinese are 45% of Bilateral loans" True.  

However, (again see link for data source)
Total borrowings............34.8 million
Market borrowings .......14.7 million    i.e. 42%.
Bilateral borrowings..... 10.6 million    i.e. 30%
China borrowings........... 4.77 billion  (45% of Bilateral: i.e. (10.6 x 45% ): 
.......................................13.5% of Total Borrowings (4.77/34.8)

Indian Bullet train. I.e India has a 50-year loan at just 0.1% interest from Japan with a 15 year grace period.
The carrot. Most of the money goes back to Japan to purchase locomotive. And then parts, maintenance etc over 50 years.  Thats probably in the fine print.  Nobody,I repeat Nobody  gives handouts. there is always a catch or string

Sumit:SL approached China twice to restructure in 2015 and 2017
Never heard of that. Any link.  Maybe, you are thinking of the Port lease. That was not to restructure debt, it was to raise money because the West was not obliging.  Money was spent on consumption.

China Visit of Mrs. Sirimavo Bandaranaike (1963)

Link to comment thread
https://www.brownpundits.com/2023/01/27/open-thread-1-27-2022-brown-pundits/#comment-105269

Not Mainstream in ones home and Vaccines

Not  Mainstream in ones  Home Country

My sisters and I dont have the smallpox vaccine scar. When in Grade 2 (Form 1)  the Warden of  my school STC (S. Thomas  College, Mt Lavinia)  sent a letter to my father requesting that I get the vaccines. Warden is normally used for the in charge of prisoners.   To use Warden instead of Principal must be a subtle message..

 

My father then took me to his cousin Dr JS Barr... who had by that time had retired from govt service and had a private practice down Station Road, Wellawatte. Probably got the MVA-BN small pox vaccine which is given by injection. Got some other vaccine orally vaguely recall.  (was informed MVA-BN was licensed much later than when  I entered school in 1966)  
 

So dont have three scars on my upper arm. On and off would get called a "Kallathoni" because of not having the scars. The travails of having parents not doing things in a mainstream manner. (Kallathoni=Illegal Immigrant from South India, like Wetback in US. Derived from Kallar= Black/Thief and Thoni/Dhoni = a kind of boat). Indian Illegal immigrants did not have vaccine scars..

In Sri Lanka  all children had to get the triple vaccine (free from Govt  Hospitals) to stay in school.. Triple vaccine is for Smallpox, Polio and TB.   The TB vaccine, BCG can give a false positive on Mantoux test. Found that out when  trying to donate blood, when I was grad student in US.  Sri Lanka has a very impressive  National Immunization Programme, post independence other than for smallpox which started in  1886.

 

Then the other issue was STC wanted a baptismal certificate. My mother was strong Evangelical christian. Her parents were one of the first in the South, and built the first AOG/Pentecostal Church in Galle, right next to the ancestral house.

 

So I didnt have a baptismal certificate. Instead had a Christening certificate. That did not seem acceptable to college Warden AJC Selvaratnam at the time. Finally had to get a letter from either Pastor Starhe (swedish) or Sister Hutchins explaining that for Pentecostal Christians, baptism is a choice made as an adult. I think thats when one gets "born again". Obviously, I have not been "born again".

Probably early 1960's. 502, Peradeniya Road, Kandy (near Piachaud Gardens).
Sister Hutchins is seated in middle in glasses.


Enar, Roland and Rakel Stahre, Swedish Missionaries, Lighthouse Mission, Kandy, 1963

?,Ada Thufesson, Mrs. Anthi, Swedish Missionaries, Lighthouse Mission, Kandy, 1963



Majken and Stig Anthin, Swedish Missionaries, Lighthouse Mission, Kandy, 1970
 

Fast forward, had around 2-3 years of Bible Study since round age of 10  By age 12 or so was convinced there was no god, and the Bible was full of contradictions. Contradictions meant, no single truth and hence the Bible was not the word of God 

Anyway Christians had to go to Chapel about 3 times a week.  So because I no longer believed in God decided not to go to Chapel.  Instead went to the Buddhist thing held at the school hall.  Rarely did anyone in authority turn up, so it an unruly free for half hour.  Perfect in my opinion.   That happy state of affairs did not last long, someone blabbed.  So the class master pulled me up and said I had to go to Chapel.  I said , no longer believed there was a God and so did not need to go to Chapel.    Master, said hmm you need to speak to the Warden.

By that time the Warden SJ Anandanayagam was an old Thomian.  I guess he knew how to deal with different kinds of guys.  Even worse he kind of knew my father and his family.   I laid out my case of not believing in God etc.  He did not blink, gave some bullshit about it all being reasonable thinking.  Then he gave the coup de grace, "You need to get a letter from your father".

So back to Chapel. I was pissed So, brought a screwdriver from home and carved my names on the pews during Chapel time.  A lot of effort, given that my name has 26+ letters.  One fine day, when in class get a note from the Chaplain Father Townsend, asking me to come to his office. The Father accused me of carving my name in the Chapel. I said yes. He asked why, I explained about being forced to go to Chapel and that I knew most of the stuff from Bible study.. Father Townsend, thats all very well, but you cant carve your name in the Chapel.  Quite unreasonable from my point of view at that time,  One has to keep occupied in a boring situation, noh. 

Father Townsend then went on to accuse me of writing dirty words in the Chapel hymnals. That I did not do and said so. You know who did that, me: no I dont.  I knew, but unwritten code of not blabbing kicked in. Father Townsend said I would have to take the punishment for carving name and writing dirty words.   I was a skinny kid, at best 90 lbs.  Father Townsend was a red faced big burly, 6+ foot Australian.  He laid it on thick.   So a caning with six of the best.  The worst caning I had in life, but did not flinch.

So after the pain had subsided, was even more pissed at the unreasonableness of it all.  So in the coming weeks during Chapel time would sneak into the belfry and carved my name in a couple of places.  I got that idea from Tom Browns School  Days (available for free in link).  Nothing like classics to give ideas on various schemes.