Where Is the World, Without American Consumers?

In fact, the rest of the world has queued up to lend America as much money as it might wish to borrow in order to get its consumers to spend again, and buy the manufactures and raw materials of the rest of the world. _Spengler

Spengler looks at the demographics of the developed world, and wonders where the old societies (Europe, Japan etc) will find the booming young societies to invest their wealth, for good return.

Imagination fails in the case of Europe and Japan. One out of every four Germans today is older than 60, and in 30 years the proportion will rise to two-fifths. Japan is even worse: 30% of Japanese today are above 60, and in 30 years the number will be almost half. What does a national economy look like when the demographics are so skewed to pensioners?

We never have seen anything like this before in all of history. Pension and health costs projected forward will crush these economies a generation from now. Taxes will suffocate the dwindling population of young workers. A straight-line projection of present trends takes us to the cusp of national failure. We do not know whether present trends will continue in a straight line, to be sure.

Economic expansion requires the fresh ideas and energies of the young. Old Europe, Japan, etc. no longer have youth or young.

China has more young people than any other country in the world, more than all of Europe put together, but too many of them are trapped in rural poverty, uneducated and untrained.

And China's "one-child" policy means that parents will not always be cared for by their children. They must save their money for a rainy day, since China has no meaningful "safety net." They have no brothers or sisters, no uncles or aunts, no nieces or nephews. Imagine the poverty of relations, and what that must do to a person's worldview. And no one really knows where China is heading long-term.

Without the American consumer -- that over-pampered, under disciplined, psychological neotenate who measures his well-being by the number of toys he buys on credit -- the rest of the world has no one to sell to, no safe, reliable growth to invest in.

To overpay unionized construction workers to build bridges, and bail out the bloated budgets of American states, the Obama administration will flood the world with so much Treasury debt that capital will flow out of the poorest countries to buy it. Rather than protest this outrageously unilateralist action, the rest of the world encourages him to do so, hoping that somehow the Obama stimulus package will get American consumers to buy their goods once again.

An interesting analysis, Spengler. The world wants to keep the charade going because it is the only game it knows? If so, it is understandable why Europe and China want the US military to go away. If someone owes you money, you don't want them to be able to resist a strong demand for payment should it ever come to that. Of course Russia wants the US military to go away, because with all of its nukes, Russia could dictate terms to a world without the US military.

What would it take for the rest of the developed world to leave the US to rot in its Treasuries? A new frontier. A new place to invest, like a breakaway libertarian seasteading confederacy, or a spacegoing migration to the belt and beyond. Otherwise, Africa or South America might work, except for the low IQ factor, and the plethora of authoritarian and tribal states. The Persian Gulf oil states will serve somewhat as an investment haven, once oil prices rebound and stay high. If not for Islamic tribalist backwardness, the Gulf oil states might truly provide a rich haven for investment.

I vote for the breakaway libertarian seasteading networks and space migrations. For those to happen, we will need significant advances in materials science, nanotechnology, biotechnology, and a rich new vein of pedagogical theory far from the current mainstream. And a lot of spirit and courage not seen since the openings of the American colonies and frontiers.

Barak "Milli Vanilli" Obama represents the authoritarian past. He brings a new wave of government expansion and a massive growth of citizen dependency on the power structure for more and more needs. That is what we must break away from, because that is the death of what is good in humans. The reality that Obama is creating will require an abrupt, and perhaps violent exit for those who wish to live and thrive apart from government strangulation. We must try to prevent things from going to far too fast. Our range of options is shrinking by the day.