NationStates Jolt Archive

I've been thinking about my own country and the new world order of the 21st century.

First, without backing up my claims I am going to make the statement that a command economy is the best. Simply, the west former champions of liberal economics are going to need to become very protectionist in order to avoid economic collapse or control at the hands of China, India, Russia, the U.S to a lesser extent and possibly Brazil.

The reasoning behind this is peak oil and the worlds false economy based off of the planets bounty of natural resources. The only way countries such as mine (Canada), will survive in the future is if the government takes control of its resources and sell it to trading partners at an artificially high price. Another country that is probably in the same boat is Australia.

Europe is already dealing with this problem by trying to become as energy efficient as possible, since the middle east is drying up, I doubt the oil in Northern Africa will last long, and Russia will hold Europe hostage with high commodity prices. The north sea seams to already be in decline as well.

Canada and other countries must diversify into a technology based economy or else its resources will be completely devoured before the end of the century and its economy will collapse. I'd really like Canada to become more like Russia, Venezuela and Bolivia our country would last longer into the future.

First, without backing up my claims I am going to make the statement that a command economy is the best. Simply, the west former champions of liberal economics are going to need to become very protectionist in order to avoid economic collapse or control at the hands of China, India, Russia, the U.S to a lesser extent and possibly Brazil.


Who all have increasingly capitalist economies. Next please.

I've been thinking about my own country and the new world order of the 21st century.

First, without backing up my claims I am going to make the statement that a command economy is the best. Simply, the west former champions of liberal economics are going to need to become very protectionist in order to avoid economic collapse or control at the hands of China, India, Russia, the U.S to a lesser extent and possibly Brazil.

The reasoning behind this is peak oil and the worlds false economy based off of the planets bounty of natural resources. The only way countries such as mine (Canada), will survive in the future is if the government takes control of its resources and sell it to trading partners at an artificially high price. Another country that is probably in the same boat is Australia.

Europe is already dealing with this problem by trying to become as energy efficient as possible, since the middle east is drying up, I doubt the oil in Northern Africa will last long, and Russia will hold Europe hostage with high commodity prices. The north sea seams to already be in decline as well.

Canada and other countries must diversify into a technology based economy or else its resources will be completely devoured before the end of the century and its economy will collapse. I'd really like Canada to become more like Russia, Venezuela and Bolivia our country would last longer into the future.

I'd argue with that, but I don't know what you're talking about.

Who all have increasingly capitalist economies. Next please.

Correct, I am talking about the smaller countries that feed them natural resources, they will have to revert to command economies in order to avoid eventual economic collapse.

I've been thinking about my own country and the new world order of the 21st century.

First, without backing up my claims I am going to make the statement that a command economy is the best. Simply, the west former champions of liberal economics are going to need to become very protectionist in order to avoid economic collapse or control at the hands of China, India, Russia, the U.S to a lesser extent and possibly Brazil.

The reasoning behind this is peak oil and the worlds false economy based off of the planets bounty of natural resources. The only way countries such as mine (Canada), will survive in the future is if the government takes control of its resources and sell it to trading partners at an artificially high price. Another country that is probably in the same boat is Australia.

Europe is already dealing with this problem by trying to become as energy efficient as possible, since the middle east is drying up, I doubt the oil in Northern Africa will last long, and Russia will hold Europe hostage with high commodity prices. The north sea seams to already be in decline as well.

Canada and other countries must diversify into a technology based economy or else its resources will be completely devoured before the end of the century and its economy will collapse. I'd really like Canada to become more like Russia, Venezuela and Bolivia our country would last longer into the future.

A couple things;

1) You don't have to have a command economy to be protectionist. We were protectionist all up until the early 90's (and we managed just fine.) Why would you go and wreck things with a command economy?

2) If the scenario you describe is true, and all of the worlds natural resources are used up, it doesn't matter what country you're in. We're all fucked.

Correct, I am talking about the smaller countries that feed them natural resources, they will have to revert to command economies in order to avoid eventual economic collapse.

Or switch to alternative energy sources.......

A couple things;

1) You don't have to have a command economy to be protectionist. We were protectionist all up until the early 90's (and we managed just fine.) Why would you go and wreck things with a command economy?

True, a full reversal of nationalizing natural resources would be bad for the economy, but I do think that it would best in the long run for all of Canadians to benefit from the finite amount of natural resources.

2) If the scenario you describe is true, and all of the worlds natural resources are used up, it doesn't matter what country you're in. We're all fucked.

Recycling of material is still a possibilty, I believe India recycles or reuses 90% of its trash and Brazil has a pretty effective recycling program.

I don't think the world will go easter Island any time soon, but their will be a distinct scarcity of natural resources.

Or switch to alternative energy sources.......

Unless all our energy is generated through electricity and we don't run out of copper, I am pretty pessimistic about alternative energy. Biofuel is going to be really expensive with all the land needed to grow the crops and hydrogen is not going to be commercialy feasible for awhile if ever.

The US is a command economy too. It just centrally plans by managing demand instead of supply.

The problem is that most people don't realize that fact.

Command economies are some of the most wasteful and inefficient in the entire world; if you're looking to solve resource scarcity by that method, good luck because it will inevitably fail. In fact, it's suspected that one of the reasons why the Soviet Union collapsed is that it was unable to make its economy less resource intensive.

The market, combined with responsible trade and government encouragement of alternatives are the only ways the economic challenges of Peak Oil will be met. It is not going to cause anything near economic collapse, but it will dampen global growth rates and heighten inflation for an extended period of time even after the actual supply shortfalls have been dealt with.

The problem is that most people don't realize that fact.
Then it's not managing demand very well, is it?

About USSR your right, but I credit that to America and its allies having greater purchasing power for finished goods than the soviet block and its friends.

About USSR your right, but I credit that to America and its allies having greater purchasing power for finished goods than the soviet block and its friends.

That was some of it, but they also wasted a lot. On average, it took over 2 times as much energy to produce $1000 of GDP in the East as it did in the West, and to make matters worse the Soviets had to sell a good chunk of their oil production at absurdly low Comecon prices to their allies, which deprived them of the hard currency they needed to invest in to the rest of their economy.

And, of course, when combined with massive defense spending, it was only a matter of time before it fell apart. It's not surprising that the Soviets' best (qualitative) growth rates were best in the 1950's and 1960's, when military spending was kept under control and they invested in increasing productivity to cut the amount of resources needed to produce goods and services.

Then it's not managing demand very well, is it?

I believe the idea was that the US government, by covertly pressuring the media, is manipulating public opinion to generate demand for the products they want companies to produce. It's an intriguing scenario, though as they don't seem to be threatening the publishing corporations and news agencies directly, I'm not sure how they'd manage it (by somehow getting their operatives into executive positions at said companies, perhaps?).

So really, the less the public knew about it, the better.

Then it's not managing demand very well, is it?

It's done a pretty decent job.

The US is a command economy too. It just centrally plans by managing demand instead of supply.

The problem is that most people don't realize that fact.

How is demand managed in the US economy?

How is demand managed in the US economy?

My guess would be the Fed using interest rates to manage demand for money in the economy.

My guess would be the Fed using interest rates to manage demand for money in the economy.

Okay. Makes sense :)
Where's teh ebil constipatheory thingie?

I'm still trying to get around the OP's contention that only a command economy can solve resource scarcity. Certainly, one could use protectionist policies to inflate the pricing to the benefit of the nation, or outright control what is being sold out of country.

But a command economy? That's just plain silly. Why subject us to failed economic policies when we can just limit the exporting of our resources?

But a command economy? That's just plain silly. Why subject us to failed economic policies when we can just limit the exporting of our resources?

Why do that? If people are willing to export those resources, what they're getting in return is undoubtedly better than the alternative domestic offers or using it themselves, which means more value for the economy and a better economic position overall.

Why do that? If people are willing to export those resources, what they're getting in return is undoubtedly better than the alternative domestic offers or using it themselves, which means more value for the economy and a better economic position overall.

If the goal is to keep those resources for long term prosperity, then yes, you may want to limit the amount of resources you are exporting. You're thinking of terms of individuals having a right to the resources on their land. Doesn't work that way up here. Well, not exactly. So if the nation determines to reserve our oil interests for long-term prosperity (for example) , than we may do so.

Short term vs. Long term.

Economies are too complex to run top-down.

Simple as that.

If the goal is to keep those resources for long term prosperity, then yes, you may want to limit the amount of resources you are exporting. You're thinking of terms of individuals having a right to the resources on their land. Doesn't work that way up here. Well, not exactly. So if the nation determines to reserve our oil interests for long-term prosperity (for example) , than we may do so.

Short term vs. Long term.

Ah, yes. The "use everyone else's oil, then we'll be the only ones who have any MWAHAHA!" strategy :)

Ah, yes. The "use everyone else's oil, then we'll be the only ones who have any MWAHAHA!" strategy :)

That's basically the US strategy, isn't it?

(heh heh)

If the goal is to keep those resources for long term prosperity, then yes, you may want to limit the amount of resources you are exporting. You're thinking of terms of individuals having a right to the resources on their land. Doesn't work that way up here. Well, not exactly. So if the nation determines to reserve our oil interests for long-term prosperity (for example) , than we may do so.

The problem is, those restrictions can often dissuade the kind of investment needed to manage those resources efficiently; capital-intensive projects usually require a long time to pay off, and if the ROI on those projects is restricted due to caps on the amount that can be produced or exported, you're far less likely to develop them to anywhere near potential.

The problem is, those restrictions can often dissuade the kind of investment needed to manage those resources efficiently; capital-intensive projects usually require a long time to pay off, and if the ROI on those projects is restricted due to caps on the amount that can be produced or exported, you're far less likely to develop them to anywhere near potential.

The point of a command economy is to limit the exploitation of resources. Take enough from the land in order to support home industries and export however much is required for the country to maintain its quality of life.

The classic example of the failure of command economies is given from the Soviet Union.

Soviet Grain harvests were always bad, never producing near enough food to feed the populace, often relying on western sources for grain. Well, one study that was eventually undertaken by the agriculture ministry discovered that Soviet grain trucks were open-top vehicles, and as much as an eighth of any given load of grain was being lost to the wind, because the trucks were open topped.

The commission that undertook the study recommended to the agriculture ministry that they undertake to put tarps on top of the trucks (a fine solution!), but, it turns out that the trucks were not under the control of the agriculture ministry. Instead, the transportation ministry had to be notified, to undertake an inter-ministry communique of this type, high level authorization was required in the ag ministry, once it was achieved, the results of the study were transferred to the transportation ministry.

The transportation ministry endeavoured to solve the problem, but they realized that they were faced with a difficult choice. The ministry responsible for the production of the tarps was also beholden to the Red Army to provide a sufficient number of tarps to them. As always, in Soviet society, the Red Army always, always took precedence. So, after having finished their production run that was required by the Red Army, they ran permissions up and down the command chain, got permission to produce the tarps, and did that.

Now the responsibilty shifts back to the transport ministry once again, who had to transport the tarps to their destination. After running the chain of command on the transport permissions, they finally did get the tarps on the move, and they delivered them to the central depot, where it was determined where they would be distributed to. This took quite some time, finally, the orders went out to deliver the tarps, and the tarps were delivered, several months after the harvest. Come the next year, the location of the tarps, and the study had been forgotten, and the tarps were never put to good use.

*Much thanks to Econ 200 for this little tale.

The point of a command economy is to limit the exploitation of resources. Take enough from the land in order to support home industries and export however much is required for the country to maintain its quality of life.

But that's exactly what the market does now. Resources in a market economy aren't exploited because they're freely traded; the entire point of the market is to overcome the exploitation that can occur in situations where competition for those resources is limited.

But that's exactly what the market does now. Resources in a market economy aren't exploited because they're freely traded; the entire point of the market is to overcome the exploitation that can occur in situations where competition for those resources is limited.

Resource economies are the subject of economic exploitation all the time.

Big company moves in to resource-rich 3rd world country. Buys off strategic government officials. Moves in and expropriates the resources. Strategic government officials get rich. Poor people stay poor. Resources get exploited.

Now, Canada's not a 3rd world country. But we have all the resources we need to be a completely self-contained economy if we so wish. I'm not saying that we should, but there's no reason to use up our vast natural wealth sooner than we need to. We're a resource based economy that relies primarily on trading those resources externally. We're doing it for our short-term advantage. (Reciprocity/Free Trade debates in Canada have always been controversial. We would always be 'hewers of wood, and drawers of water'.) But it's the kind of thinking that largely damaged our Atlantic fishing economy, and could very well endanger other sectors into the long-term as well.

The whole point is kinda moot, seeing as we're rushing headlong into a complete economic partnership with the rest of North America. I just don't like the idea that the control of resources that are nominally Canadian, and not belonging to individual citizens, are out of our hands. And of course, they're not. We could at any time say, 'No, we're saving some for a rainy day'.

That 'rainy day' may be sooner than you think. *shrugs*

The point of a command economy is to limit the exploitation of resources. Take enough from the land in order to support home industries and export however much is required for the country to maintain its quality of life.

But you can achieve a much higher quality of life by openly participating in the global economy. This is the primary argument in favour of free trade.

My guess would be the Fed using interest rates to manage demand for money in the economy.

Yes!

And managing the tax laws to direct capital into certain areas.


The idea that the US is a free market is incorrect.