Along with other news sources I subscribe to Geopolitical Futures, and I get more information than I can process daily. Having a job really does interfere with my life, as I would like to publish more of what they talk about, and make comparisons with the observations of others.
Having said that I try to emphasize the importance of demographics in the mix regarding what governments do and why.
The world's demographic pyramid is all out of whack, and two things are happening. First, the age group between 15 and 50 - the group that really moves an internal economy - is so small in some countries it stifles economic growth. Secondly, the group that would be the "baby boomers" in America is so large there's a major problem developing in every country in the world - funding their retirements. Demographic pyramids and spending, those cannot be emphasized enough.
Mexico now plans on spending 28% of it budget "on pensions and financing debt". As is in the case of virtually all governments they only deal with the short term solutions because the real long term solutions would require them to make significant changes in how the nation is run. Meaning - most of the elite would have to be replaced.
I used Mexico in this because they're right next to the largest economy the world has ever known and yet - they're still not able to create a real capitalist society. Even though the U.S. has massive debt problems, overlarge government, intrusive bureaucracies, insane spending and problems financing retirement plans - the U.S. is a natural capital generator and with a few changes all this could be turned around in a short period of time - at least as compared to the rest of the world, which functions as top down societies.
So this brings be to Russia, which has huge resources and yet is still not a natural capital generating nation because it's entire economy still functionally operates as a communist central planning country with corruption so rampant it's impossible for Russia to face the upcoming economic disaster they're bound to face. They - like Europe - is breeding themselves out of existence, and that vital 15 to 50 age group in their demographic pyramid is small, sick with drug resistant TB and AIDS, and drunk.
Their solution is to reduce their pension output over the next three year, by 0.7% and 0.6%. Right now their pensions eat up "24 percent of the Russian budget"....."and 68 percent of all social spending."
Russia has seven defensive gaps with only manpower to defend three, and they're facing serious problems internally. According to Geopolitics Futures "mass evacuations due to bomb threats in Russia continue apace. Residents are now leaving the Siberian cities of Tomsk, Chita, Ulan-Ude, Irkutsk, Yakutsk, Abakan and Kemerovo; the Far East cities of Petropavlovsk-Kamchatsky and Khabarovsk; and the Volga cities of Samara and Saratov. Let’s look into the source of these bomb threats. According to RIA Novosti, which cited unnamed law enforcement sources, the threat came either from Ukrainian terrorists or from the Islamic State. The reports have not been confirmed. More places were evacuated in the subsequent days."
Russian leaders still think they can push everyone around without consequence, and that's not happening and in the future their bully boy tactics will come back to haunt them even more because - they're broke and going more broke by the hour - and they're not going to be able to fix it because they refuse to give up control of the economy and allow private ownership of property.
What's worse - Russia's natural enemy, Turkey, has had economic growth of "over 5 percent in the second quarter of this year", and it appears the nation's economic planning has reaped results. I don't see this going on forever because it's still based on central planning, but in the meanwhile this puts pressure on Russia to maintain those three defensive gaps - and they are all around the Ukraine and Turkey. How much can Russia do elsewhere militarily?
As for China - their economy is a false economy and capital being squirreled out of the country has been a problem for some time. And now they're even demanding companies do not invest abroad. Why? I have to believe they need to keep the capital in China in order for China just to stay above water economically, but that won't help if there's a worldwide economic downturn. If that happens China will collapse like the paper tiger it is. And it occurs to me they're wanting to make sure their best and brightest have no place to run when the inevitable collapse happens.
No comments:
Post a Comment