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It is said that after General Burgoyne’s surrender at Saratoga during the Revolutionary War that a young nobleman, named Sinclair, came to Adam Smith, and declared that the surrender would be “the ruin of the nation.” To which Adam Smith reportedly responded, “There is a great deal of ruin in a nation.” Meaning, one supposes, that nations are sturdy things, and it takes more than you probably think to kill them off, or even cause them long term inconvenience. And certainly the UK remained a great power for many, many years after this.
In our own day we have a lot of Sinclairs running around saying that this or that will be the ruin of our nation. In the past I think it’s fair to say that most of the Sinclairs came from the right side of the political spectrum. But, lately, global warming and the election of Trump, among other things, have given the Sinclairs on the left greater visibility. Despite all this panic from both the right and left, I think Smith’s statement is still essentially correct, “There is a great deal of ruin in a nation.” And I think we’re a long way away from the US collapsing in spectacular fashion, if indeed it ever does. Most nations go out with a whimper, not a bang.
There is one possible exception to this: nuclear weapons. As usual they’re a huge wild card. I don’t think some limited exchange would cause the nation to collapse (though given the extreme reaction to 9/11 who knows.) But certainly if there was all out war between the US and Russia you’d be shocked if the US wasn’t fundamentally altered in some critical aspect. (Loss of territory, change in system of government, etc.) And to be fair to the people panicking over Trump, we have foolishly given the current president absolute control over the nuclear arsenal. All of this is to say, that I’m not going to rule it out, but that’s a subject for a different post (one I’ve already written.)
On top of this, there are also of course natural disasters, the eruption of the Yellowstone super volcano, a new Carrington Event, etc. But I want to talk about what might happen in the normal course of things, in fact I want to talk about what might happen without any huge black swans. Which is not to say there won’t be black swans, there definitely will be (positive and negative) but to look at how bad things can get even if without them.
I was prompted to write on this topic when I read a recent Bloomberg article by Tyler Cowen: The Decline and Fall of the American Empire, where he essentially takes the same approach. He lists numerous challenges America will soon be facing. None of these challenges are surprising, or especially dramatic, but neither are any of them simple to solve, or easy to avoid. I’ve decided to go through his list, make some of my own comments, and then, at the end, add a couple of my own items as well.
He starts off by assuming that we get through the Trump presidency without a major constitutional crisis. I think that’s the way to bet, but he’s already assuming a rosier outlook for the future than many people, who can’t see farther than 2020. And it’s after 2020 when things start to get difficult, because it’s only then that recent financial trends really start to reach a tipping point. Cowen’s summation of the problem is excellent:
In recent years, the underlying rate of productivity growth often has been about 1 percent, and rates of economic growth are not even half of what they used to be. Meanwhile, America will have to increase taxes or reduce spending by about $2,200 per taxpayer per year to keep the national debt-to-GDP ratio from rising ever higher, and that figure predates the Trump tax cuts. To fund that shortfall, the U.S. will cut back on infrastructure maintenance. At least one-third of this country will end up looking like — forgive the colloquial phrase — “a dump.” The racial wealth gap will not be narrowed.
This takes us back to the question of whether national debt matters. I have argued strongly that it does, and Cowen seems to think so as well. Though as he mentions, if economic growth was better this might not be a problem, and indeed GDP for the second quarter of this year was a blistering 4.1%. Which Trump took credit for of course, and maybe he should, I don’t see many other great explanations for it out there, and certainly it’s the opposite of what many economists predicted would happen after Trump was elected. But for the majority of people who don’t believe Trump is going to usher in a new era of consistently high growth, and who also believe that the debt does matter, then the problems Cowen point out appear to basically be inevitable.
What effect will this have? Well it depends on what ends up getting cut. Cowen already mentioned infrastructure maintenance, but even if we cut that to zero it wouldn’t get us very far. To make any significant dent you have to cut spending from military or entitlements. Cowen is of the opinion that entitlements will mostly survive, meaning most of the money will come from the military. I generally agree with this assessment, though I’m not sure it’s the right choice, at least from the perspective of avoiding big negative black swans. Allow me to explain.
If you cut entitlements, then you have a lot more poor people, and presumably these people suffer more than they would if they were not as poor. More alarmingly you might end up with people dying who otherwise wouldn’t have. So it is bad, potentially very bad. Though I think in the end it wouldn’t be quite as bad as people predict. And I would even predict there would be some long term positives in there as well.
If you cut the military, then suddenly rather than having the umbrella of US global hegemony keeping regional conflicts below a certain level, you end up with a re-ordering of regional spheres of influence. Here’s how Cowen imagines it playing out:
Over a period of less than five years, China will retake Taiwan and also bring much of East and Southeast Asia into a much tighter sphere of influence. Turkey and Saudi Arabia will build nuclear weapons and become dominant players in their regions. Russia will continue to nibble at the borders of neighboring states, including Latvia and Estonia, and NATO will lose its credibility, except for a few bilateral relationships, such as with the U.K. Parts of Eastern Europe will return to fascism. NAFTA will exist on paper, but it will be under perpetual renegotiation and hemispheric relations will fray.
I’m not sure where Cowen starts his five years. From today? From the minute we start cutting the military? Regardless, the China scenario he outlines is becoming increasingly likely regardless of what the US does, and a reduction in our military would only hasten it. But it’s his next claim that’s more alarming, that Turkey and Saudi Arabia will build nukes. Though, once you assume the decline of American hegemony, than the rise of regional powers would seem to naturally follow. And it’s hard to imagine how someone can be taken seriously as a regional power if they don’t have nukes, particularly if their rivals do. People always talk about India and Pakistan in the same breath and yet India is eight times as wealthy and has seven times as many people. Yet they both have nukes, which gives Pakistan an equality it could otherwise never hope to claim. On top of the two countries Cowen named, Turkey and Saudi Arabia, I would add the usual suspect of Iran, but there’s also a good possibility Japan would develop nukes.
Here, we can finally see why I’m not sure that cutting the military in preference to cutting entitlements is the right choice. Yes, cutting entitlements would almost certainly cause some suffering, but it’s hard to imagine how a nuclear war, even a limited one wouldn’t cause a lot more. Though in reality the end of American hegemony has to come eventually, I’m sympathetic to people who think it might be replaced with some kind of global government which will keep the peace. But nothing in the current geopolitical landscape leads me to think that has the remotest chance of happening. All of this is to say that there doesn’t appear to be a lot of good options.
Cowen moves on to talk about drugs, and while he thinks the opioid crisis will eventually abate, he worries a lot about drugs which can be whipped up in a “home lab”. I’m not sure I share his optimism about the opioid crisis, I agree it’s hard to imagine that it will continue at the same rate. Overdose deaths from Fentanyl increased at an annual rate of 88%(!!!) from 2013 to 2016. Were that rate to continue the entire country would be dead by 2030. But even if everything were to freeze where it is we’re still looking at 64,000 deaths from overdosing on drugs per year, which is now nearly twice as many as die in car accidents every year. As far as “home lab” drugs, also called designer drugs, I’m not sure how big of a problem they will be. Obviously I’m inclined to caution, but my initial impression is that so far they (fortunately) haven’t lived up to the hype. A search on designer drug danger turns up a lot of articles from 2013, and the number three hit is from 2003, so I’m not sure what to make of that. At a minimum it doesn’t seem like we’ve reached a crisis point yet.
There was an article just recently in the Atlantic claiming that marijuana is a lot more addictive than people claim. And I feel like I should mention it in this section. Though fortunately it’s basically impossible to overdose on marijuana, it does seem like when you pull all of this together that there’s a real danger that we’re turning into a nation of lotus eaters.
Cowen goes on to talk about technology, but rather than talking about benefits of it, he chooses to focus on the potential downsides. Many people are optimistic about the future precisely because of technology, but Cowen points out that in the near term we’re more likely to see technology being used to create a dystopian police state, than a transhumanist paradise. He doesn’t mention China in this context, but that’s an example worth considering.
Those, like me, who were around during the Tiananmen Square protests of 1989, can probably remember thinking that the fall of the Chinese communists seemed inevitable. Recall that 1989 also saw the beginning of the end for the Soviet Union, the fall of all Eastern European communist regimes and the tearing down of the Berlin Wall. Change was definitely in the air. (Negotiations to end South African apartheid began the next year in 1990). And yet amidst all that change the Chinese Communists hung on. How they did that is a post unto itself. (One I’m almost certainly not qualified to write.) The important point is that somehow, despite all the technology that has come along since 1989, in particular the world wide web, the Chinese communists have continued to hold on.
It’s unclear how much technology has hindered the ability of the Chinese communists to hang on to control up until this point, but going forward there is a lot of technology which promises to greatly assist them in that endeavor. And here we turn back to Cowen:
Artificial intelligence and facial and gait surveillance will lead to unprecedented invasions of privacy, causing another 1 or 2 percent of Americans to decide to “live off the grid.” The impact of assassin drones will be curbed — by filling the skies with police drones. Public crimes will plummet, but public spaces in major cities will have a depressing sameness, due to the near-total absence of spontaneous behavior. Advances in recording technologies will make most conversations in public, and many in private, remarkably bland.
As you may have noticed, he’s talking about America, but you know that however bad it is here, it will be ten times as bad in China.
From there he goes on to touch on global warming, and much like myself, argues that “The very worst fears about climate change won’t come true.” Though, he argues that it will still be a significant drag on the economy, making the growth necessary to avoid cutting the military (or, less likely, entitlements) that much harder to achieve.
Cowen decides to end the article by tossing in some of his own petty gripes. Which include the fact that as more and more of current media is being driven by what is or isn’t available to stream, that fewer people are going to end up seeing classic movies. (Though one would think that once the copyright expires everyone will have old movies available for streaming, but maybe the cost of digitizing say, Battleship Potemkin, is prohibitive.) He also predicts that live performance of classical music will become less and less common. I can certainly sympathize with both of these complaints, though if I were to list my own petty annoyances I would probably come up with something like the proliferation giant ear gauging, or the vacuity of social media, or how the hollywood regurgitation loop just keeps getting smaller and smaller. But that’s just off the top of my head (and my first annoyance is almost certainly due to some giant gauging I saw just yesterday.)
The point of all of this, as I mentioned at the beginning, is that there are a lot of current trends which suggest ways in which the future could go poorly, without being catastrophic, and Cowen has done an admirable job of explaining many of the ways this could happen, but he did miss a few. This is entirely understandable. He made no claim to being comprehensive. But there’s one in particular that I think deserves a mention, and it’s one which might end up being as, if not more consequential than the things he did mention.
This is the population growth trend in Africa. Most people will automatically translate this into a a claim that there are “too many Africans”, which is not the sort of thing one talks about in polite society (and probably one of the reasons why Cowen didn’t mention it.) For myself, I certainly hope that how ever many people there end up being, both living in Africa and elsewhere, that they will grow up happy and well fed, and that they will all be blessed with the same opportunities and advantages as people born in the United States or Europe. But, I also hope that I’m wrong about the dangers of the national debt and that medicare and social security and Pax Americana will last forever. And, unfortunately, just because I hope for all these things doesn’t mean they’ll happen, though of course they might.
All of this is to say that Africa might have problems with overpopulation, just as all the things Cowen mentioned might happen as well. And this is certainly the way the trend is pointing. if you look at the official UN predictions for the population of Africa their most conservative estimate still has Africa reaching a population of just over 3 billion (up from 1.2 billion right now) with the most extreme estimate being that it will north of 5.5 billion (both estimates are for 2100). Now there has already been a lot of panic about overpopulation which didn’t end up coming to pass. And I hope that my fears will prove to be overblown again, but there are a lot of ways for things to go wrong and only one way for them to go right.
As far as ways for things to go wrong, well we’ve already gotten a first taste of one way they could go poorly with the recent European refugee crisis. Whether the Europeans should have been more welcoming is somewhat beside the point. Their welcome was what it was, which was somewhat mixed to say the least. And if that’s their reaction to the flow of refugees when the population of Africa is 1.2 billion what will it be like in 30 years when the best guess of the UN is that it will be twice that?
The reaction of Europeans and other people in the developed world to the refugees is what many people are focused on at the moment, and will probably be the thing most people are interested in for the foreseeable future, but in the long term what I’m really just trying to show is that we probably can’t assume that the “riches” of the developed world will be redistributed in such a fashion that all of the additional people will be taken care of. It might be nice if they could all come to America and Europe, find a place to live and a job, or if we could just increase our foreign aid, but that seems very unlikely. The people living in Africa are going to have to figure out a way to support themselves, specifically they’re going to have to figure out how to grow enough food to feed a lot more people, potentially three or four times as many people. I’m going to be honest, that seems like a hard problem, even if all of the energy of science and technology is brought to bear on the problem.
Accordingly, another way in which the future could go poorly just based on current trends (though catastrophic may be a better word) is for there to be widespread famine in Africa. As I said, it may not happen, everyone thought there would be widespread famine in India before the Green Revolution and there wasn’t. I hope that essentially the same thing happens with Africa.
It’d be nice if at the end of it all I could point out some simple things that we could do to solve the problems Cowen mentioned, but there aren’t any, which is of course why he’s worried about them. In fact one would be inclined to think they’re unavoidable. They may be.
I can offer only two pieces of consolation. First, there is of course the advice of Adam Smith, which I started the post with. There is a lot of ruin in a nation, or in a continent or in a civilization, and I’m sure we’re all farther away from catastrophe than people think. Though that’s part of the point, catastrophe may be far away, but a situation where things are just kind of “sucky” (if you need an example think, the 70s) might not be that far away.
Second, the technology optimists, of whom Steven Pinker is the best example (particularly his book Enlightenment Now, which I talked about in a previous post) will argue that technology has solved all of the problems we’ve had so far (this is debatable, but also not the time to get picky.) This has often happened through means we couldn’t even imagine a few years beforehand, and there’s every reason to think that technology will do so again. I certainly hope that it creates another Green Revolution and that there isn’t widespread famine in Africa or anywhere else. I’m less clear how technology will solve regional conflict in the absence of American power, or the related problem of US government spending, but despite that I hope it solves those problems as well. As I have often said, I hope I’m wrong, but I fear that I’m not. Or as Cowen says in closing his article:
So what in this description sounds so implausible? Is it that you think productivity growth will come in at 3 percent? That it will all be worth it because advances in medicine will allow us to stick around in decent form until age 135? That technological breakthroughs will extend the reach of the U.S. military further yet? That the Mars colony will be awesome?
Just how lucky are you feeling?
In answer I would say, I think our luck might be running out. Or to put it a different way. The harvest is past, the summer is ended, and we are not saved.
You may be thinking, “But there must be something I can do? Maybe I could contribute to something? Maybe something which calls attention to these problems? Maybe a blog or something like that?” Well you’re in luck. You may not have heard, but I just drew attention to it, and I accept donations!
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