Archives for February 2009

Is The US In 2009 Like The USSR In 1989?

Inspired in no small part by the political charade over the bail-outs and boondoggles that plague the TV screens and electronic ether, I’ve compiled a top 10 list of ways in which the US increasingly resembles the collapsing Soviet Union for your information / despair / entertainment / Schadenfreude / ridicule / etc.

A list of how Russians screwed up and Americans are repeating their mistakes step by step. A list that may provoke much needed debate and change that we can really believe in.

10

An alcohol epidemic from the 1960’s on that kept Russian life expectancy flat ever since.

Dietary catastrophe resulting in historically unprecedented obesity and diabetes rates.

9

Hated and feared for human rights violations, invasion of Afghanistan and Communist rhetoric, and its socialist model discredited.

Hated and feared for use of torture, invasion of Iraq and post-Cold War triumphalist arrogance, and its neoliberal model discredited.

8

Military overstretch, economic distortion and disaster in Afghanistan.

Imperial overstretch, runaway military budget and return to the “graveyard of empires”.

7

Wasteful investments into infrastructure, bloated bureaucracy and inefficient industry.

Decaying infrastructure, misplaced investments into suburbia, bloated financial system and hallowing out of industry.

6

Collapse in morality, bloated bureaucracy and soaring corruption.

Regulatory capture, bloated special interests and legalistic mafia.

5

Suppression of statistics and silencing of dissent.

Manipulation of statistics and ignores dissent.

4

Dependence on foreign credit from debts and oil sales.

Dependence on foreign credit from debts, “dark matter” and the $’s status as global currency reserve.

3

Young reformer takes power and talks of glasnost and perestroika while avoiding real reform.

Young “outsider” wins the elections and talk of change and hope…

2

Ethnic nationalism and separatist tendencies.

Tax revolts and state rights.

1

More and more people began to predict Soviet collapse in the late 1980’s.

More and more people are beginning to predict an American collapse now…

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What a Picture Wants

The sea billows in its elemental rage and snow-capped mountains loom above the thick fog ahead. A schooner and dinghy flounder in a fury of air and water, forlorn and forsaken. Sailors can be made out on the two ships, frantic atoms against a backdrop of deadly beauty. Insignificant, they stand out. After all, the sublime needs a human presence (yardstick?) to be appreciated.

The painting is ‘Stormy Sea’ (1868) by Ivan Aivazovsky. He was one of the most prolific Russian artists and is especially famous for his mastery of the seascape, which ranged from the calm (‘The Coast at Amalfi’) to the catastrophic (‘The Storm’).

What does it mean to ‘want’? Negatively defined, it is to be deficient in something, such that the absence of it grates on the soul. When we look at a picture, in a sense it becomes a part of us, a simulation in that part of the brain responsible for visual processing. Conflicts can appear between our innate sense of aesthetics and the simulation that was thrust into our mind. Presumably then, a picture is in want of something if it is deficient in something – an object, or perhaps something more general, say lighting. Or maybe it completely fails to arouse any interest and can be dismissed. In any case, let’s say a picture wants what we want of it.

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Voice of the People (since July 2008)

Since the last time I covered Levada‘s opinion polls was a whopping half a year back, I reckon its time to make an update on what Russians are thinking since then. A comprehensive kind of post, like what I did in Lovely Levada (check it out, if you haven’t already!) and hopefully a good resource for Russia-watchers of all stripes. Russophobes will find some good material here too :). I’ll start from the most recent and presumably relevant ones, and work my way down to where we left off last July, trying to select polls that are non-repetitive and interesting. Please note that there is a Part II since the original post was too long to post.

2009, Feb 13: Two opinion polls on wellbeing and consumer expectations. The Crisis and Social Feelings has lots of different graphs of consumer confidence plummeting down towards the end of 2008, as everywhere else in the world. People are postponing consumption; preferences are shifting from the Euro to the $, but the ruble remains surprisingly strong; and worryingly, 41% think the economy will not start recovering for more than a year compared to 27% who think otherwise (my own bet is half a year to a year, as I wrote in previous posts).

The second poll is the Crisis and problems in consumer credit. It has an interesting chart of how people’s feelings about buying expensive things on loans changed from 2001 to 2009. Not surprisingly they collapsed recently, which is one of the main reasons that car sales, of instance, have fallen off a cliff. What I find more interesting is that the height of debt mania was during the mid-2000’s. Meanwhile, attitudes worsened during the past two years, when the worst excesses of Russian corporate binging on cheap foreign credit took place.

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Book Review: George Friedman – The Next 100 Years

The Next 100 Years by George Friedman, published in 2010. Rating: 3/5

George Friedman at Stratfor is one of my favorite analysts on world geopolitics. This is because he tries to look at the world as it is, without the pointless moralizing, neoliberal ideologizing and end-of-history triumphalism that clouds too much American geopolitical thinking. Hence whenever I come across new and substantial material from him, although I might not agree with some (or most) of what he says, I nonetheless adjust my beliefs (in a good Bayesian fashion).

And lo and behold!, he comes out with a new book – The Next 100 Years. Funnily enough, it is about the next 100 years, or more specifically, the interplay between technological and demographic trends and geopolitical dynamics that will shape the twenty-first century.

I was originally going to copy out its entire first chapter, Overture (which is available online) and just comment on it. Unfortunately this makes it far too long and I had problems publishing it. So I’ll headline and summarize Friedman’s main points instead and leave my original commentary largely unchanged.

1. The future is unpredictable: “Be practical, expect the impossible”.

Friedman starts off by summarizing the history of the last century in twenty year chunks. Thus we got from the globalized idyll of 1900, through the chaos of 1940, the gathering storm clouds of 1940, the American dominance in 1960, the rising Soviet challenge in 1980 and culminating in the renewed globalized idyll of 2000 – only to be again disrupted by 9/11.

Completely agreed – most commentary is about the short-term, or at best linear extrapolations of short-term things. Good futurists think in terms of differentials, exponents and tipping points.

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Oily Origins of the Economic Crisis

In an article some months ago I suggested that “perhaps this crisis is simply an unconscious recognition of this inconvenient truth?” – namely, the peaking of oil extraction and all that it implies for the continued survival of a financial system built on assumptions of continuous economic growth. In other words, the fashionable approach of focusing on exotic financial instruments, regulatory failures, etc, if a case of mistaking the forest for the trees.

The Oil Drum had a nice graphical summary. According to the author, Gail the Actuary, the chain of causation runs thus: rising oil prices -> inflated asset values -> booming phantom wealth -> high energy costs undermine real economy -> more and more bubbles pricked -> banking crisis -> credit crisis -> cascaded economic failure -> oil demand destruction -> oil prices plummet -> so do ever costlier long-term investments in oil extraction -> economic recovery at lower level -> rising oil prices. Cycle repeats itself to oblivion.

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Hubris in the Heartland

The Western MSM (mainstream media) was abuzz the last few weeks about how Obama’s apparent extension of a hand to Russia did not make them willing to unclench their fist, citing the closure of the Manas airbase in Kyrgyzstan. This was linked to Russia’s announcement of 150mn $ in aid and 2bn $ of credit to Kyrgyzstan, which was widely interpreted to be a bribe, a snub to the US or in some particularly nutty cases open support of the Taliban – as SWP put it, “objectively chosen to aid 8th century religious fanatics”.

Kyrgyzstan is a poor state relying on remittances from its workers in Russia, workers who are now being laid off as construction grinds to a halt. It is the only country in post-Soviet Central Asia to have rejected the status of a “developed” country to be eligible for more funds from the World Bank and other international development organizations. Coupled with the economic crisis sweeping the globe, this money is small change to Russia but a life-saver to Kyrgyzstan.

The perception that this is a Russian anti-American machination arrogantly dismisses Kyrgyzstan’s own incentives. It has not been happy with the American presence (see below). It is in their interest to play off Washington against Moscow for more aid; but ultimately, Russia is far more important to their economic development. Nonetheless, it would make sense for them to announce the shutdown of Manas in Moscow, immediately after getting promised these loans and aid, because then American ire would be deflected towards Russia. (After all, the US does have a penchant for sponsoring color revolutions in countries it doesn’t like).

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