7 ms·

I said this on another thread a few weeks ago but a lot of US citizens should be concerned about this. Debt levels adjusted for inflation put the US in a simila

by rcarr 3y ago

I said this on another thread a few weeks ago but a lot of US citizens should be concerned about this. Debt levels adjusted for inflation put the US in a similar position as the UK when it was still the biggest economy just before WW2. If a war kicks off on the opposite side of the Pacific and it gets involved (even indirectly like it is currently in Ukraine) then, even if they end up on the winning side, the US may find itself effectively bankrupt by the end of it just like the UK did at the end of WW2. Ray Dalio has a video that projects something like this happening: https://www.youtube.com/watch?v=xguam0TKMw8 https://www.youtube.com/watch?v=xguam0TKMw8

bwestergard 3y ago
The advantages of the U.S. over all of its military near-peers seem quite a lot greater than the advantages of Dalio's antecedent empires (e.g. the Dutch).
- rcarr 3y ago
  China has more warships than the US and can build them faster. It's also further along with the development of hypersonic missiles than the US and it has a much larger population to draw from in the event of a war. The US military is probably still more powerful overall and it definitely has a lot more real world experience, but the gap has been closed to make it a lot smaller than it used to be. I also strongly suspect that if a war did break out in Taiwan, other countries might start making moves knowing the US can't fight a battle on all fronts. For example, North Korea might launch an attack on South Korea, there might be more coups in Africa or Latin America in countries with critical resources etc. It would be difficult for the US to support the Ukraine war, a Taiwanese war and all these other efforts. I don't know about the US but it's well known that a lot of UK military equipment stocks are already quite seriously depleted from the Ukraine war alone. Ben Wallace was trying to get this addressed pretty urgently when he was the UK defence secretary, but the UK has so many systemic problems that need financing at the minute it's unlikely that much is going to get done about it unless something like a World War breaks out.
  - dragontamer 3y ago
    USA doesn't need hypersonic missiles because we're pretty confident we can pierce Chinese missile defenses with F35 or other such weapons. China needs hypersonic because US AEGIS Cruisers are the best anti-air defense in the world, so China needs the best missile in the world to threaten them (As well as the Supercarriers that they protect). It makes no sense for USA to build hypersonic, because none of our foes are building a missile shield comparable to AEGIS. Its the whole "Unbreakable shield / irresistible spear" paradox. If no one else has an unbreakable shield, there's no point making an irresistible spear.
    - rcarr 3y ago
      > It makes no sense for USA to build hypersonic, because none of our foes are building a missile shield comparable to AEGIS. If I remember right, one US General did come out and seem to be pretty worried about these hypersonic missiles and how far behind the US was in comparison. The Titanic was the 'unsinkable ship'. If the unbreakable shield breaks, you're going to want your spears to be the same strength as your opponents.
      - dragontamer 3y ago
        > you're going to want your spears to be the same strength as your opponents. Why? A substantial portion of energy in a Hypersonic missile is spent battling drag. Its far more efficient to kill them with sub-sonic missiles or supersonic missiles so that there's less drag. The less drag you have, the bigger the payload you can put. Think of it this way: 100% of the weight of your missile needs to be allocated between thrust and explosives. If you go 80% thrust, you'll reach hypersonic, but now you barely have any explosives left over. And the vast majority of this "thrust" is wasted on air-drag. If you go 20% thrust, you'll have 80% explosives left over for your weight. You'll take longer to get there, but supersonic (and subsonic) has significant efficiency gains. ------------ There is a USA hypersonic missile project that does away with this problem by being 100% thrust and attacking with kinetic energy alone. But you can see... this fundamental physics question of allocating "explosive" vs "thrust" is very fundamental to the situation at hand. I posit that any hypersonic missile will do less damage than an equivalent subsonic cruise missile of the same weight class. Because air-drag at hypersonic speeds really is a major play on the amount of energy you deliver to the opponent. ------------- You go "faster' not because it does more damage. You go 'faster' because it avoids the enemy defenses. But that speed costs you rocket fuel (rocket fuel that could have been high explosives instead).
- simonblack 3y ago
  All of those preceding empires thought they would be eternal. "The Empire on which the Sun never sets." was only a decade or two away from collapse. Most people aren't aware that Japan started the war in the Pacific with 3 or 4 times as many aircraft carriers as the US had. The deciding factor was that the US could replace the carriers that were sunk in 1942 whereas the Japanese didn't have the manufacturing capacity to do likewise. The US was able to build about 150 (smaller) aircraft carriers in four years, the Japanese had no hope of doing that. In today's world, the powerful US of 1942 no longer exists. The country which has the manufacturing capacity today is China. The US thinking of going to war against China is as smart as the Wehrmacht thinking of going to war against the Soviets. And we all know how that one ended up.
dventimi 3y ago
Absolutely no American who isn't wealthy should be concerned about this. The government has a monopoly on the printing press and therefore has all the money it will ever need. The obstacles, not to be taken lightly, are nevertheless entirely political and not structural.
maxerickson 3y ago
It would be helpful to explain what you mean by effectively bankrupt. Like say that Ukraine prevails with current levels of US involvement (so essentially no impact on the debt). What does that imply for "the US"? Perhaps some entitles stop transacting with "the US"? Which ones?
- rcarr 3y ago
  Dalio explains it better than I'll ever be able to, I've timestamped the video to the relevant part here: https://youtu.be/xguam0TKMw8?si=j1n3nJqbsX2YJHLj&t=1921 https://youtu.be/xguam0TKMw8?si=j1n3nJqbsX2YJHLj&t=1921 The general gist is that the dominant country is in so much debt, and the scale of the devaluation through money printing to get rid of the debt is so great, that it can no longer afford to maintain the global infrastructure necessary to keep its dominant super power status and simultaneously service it's debts so the countries who are buying the debt (which is what grant it it's reserve currency status) look for a safer country to invest in and that becomes the new reserve currency. If it's just the Ukraine war, the US is probably fine and can get it's debts down if it makes the necessary moves to resolve internal problems. If the war extends to more fronts, then it could feasibly end up exactly like the UK where it wins the war but loses the status as dominant currency.

by rcarr 3y ago

bwestergard 3y ago

The advantages of the U.S. over all of its military near-peers seem quite a lot greater than the advantages of Dalio's antecedent empires (e.g. the Dutch).

rcarr 3y ago
China has more warships than the US and can build them faster. It's also further along with the development of hypersonic missiles than the US and it has a much larger population to draw from in the event of a war. The US military is probably still more powerful overall and it definitely has a lot more real world experience, but the gap has been closed to make it a lot smaller than it used to be. I also strongly suspect that if a war did break out in Taiwan, other countries might start making moves knowing the US can't fight a battle on all fronts. For example, North Korea might launch an attack on South Korea, there might be more coups in Africa or Latin America in countries with critical resources etc. It would be difficult for the US to support the Ukraine war, a Taiwanese war and all these other efforts. I don't know about the US but it's well known that a lot of UK military equipment stocks are already quite seriously depleted from the Ukraine war alone. Ben Wallace was trying to get this addressed pretty urgently when he was the UK defence secretary, but the UK has so many systemic problems that need financing at the minute it's unlikely that much is going to get done about it unless something like a World War breaks out.
- dragontamer 3y ago
  USA doesn't need hypersonic missiles because we're pretty confident we can pierce Chinese missile defenses with F35 or other such weapons. China needs hypersonic because US AEGIS Cruisers are the best anti-air defense in the world, so China needs the best missile in the world to threaten them (As well as the Supercarriers that they protect). It makes no sense for USA to build hypersonic, because none of our foes are building a missile shield comparable to AEGIS. Its the whole "Unbreakable shield / irresistible spear" paradox. If no one else has an unbreakable shield, there's no point making an irresistible spear.
  - rcarr 3y ago
    > It makes no sense for USA to build hypersonic, because none of our foes are building a missile shield comparable to AEGIS. If I remember right, one US General did come out and seem to be pretty worried about these hypersonic missiles and how far behind the US was in comparison. The Titanic was the 'unsinkable ship'. If the unbreakable shield breaks, you're going to want your spears to be the same strength as your opponents.
    - dragontamer 3y ago
      > you're going to want your spears to be the same strength as your opponents. Why? A substantial portion of energy in a Hypersonic missile is spent battling drag. Its far more efficient to kill them with sub-sonic missiles or supersonic missiles so that there's less drag. The less drag you have, the bigger the payload you can put. Think of it this way: 100% of the weight of your missile needs to be allocated between thrust and explosives. If you go 80% thrust, you'll reach hypersonic, but now you barely have any explosives left over. And the vast majority of this "thrust" is wasted on air-drag. If you go 20% thrust, you'll have 80% explosives left over for your weight. You'll take longer to get there, but supersonic (and subsonic) has significant efficiency gains. ------------ There is a USA hypersonic missile project that does away with this problem by being 100% thrust and attacking with kinetic energy alone. But you can see... this fundamental physics question of allocating "explosive" vs "thrust" is very fundamental to the situation at hand. I posit that any hypersonic missile will do less damage than an equivalent subsonic cruise missile of the same weight class. Because air-drag at hypersonic speeds really is a major play on the amount of energy you deliver to the opponent. ------------- You go "faster' not because it does more damage. You go 'faster' because it avoids the enemy defenses. But that speed costs you rocket fuel (rocket fuel that could have been high explosives instead).
simonblack 3y ago
All of those preceding empires thought they would be eternal. "The Empire on which the Sun never sets." was only a decade or two away from collapse. Most people aren't aware that Japan started the war in the Pacific with 3 or 4 times as many aircraft carriers as the US had. The deciding factor was that the US could replace the carriers that were sunk in 1942 whereas the Japanese didn't have the manufacturing capacity to do likewise. The US was able to build about 150 (smaller) aircraft carriers in four years, the Japanese had no hope of doing that. In today's world, the powerful US of 1942 no longer exists. The country which has the manufacturing capacity today is China. The US thinking of going to war against China is as smart as the Wehrmacht thinking of going to war against the Soviets. And we all know how that one ended up.

dventimi 3y ago

Absolutely no American who isn't wealthy should be concerned about this. The government has a monopoly on the printing press and therefore has all the money it will ever need. The obstacles, not to be taken lightly, are nevertheless entirely political and not structural.

maxerickson 3y ago

It would be helpful to explain what you mean by effectively bankrupt. Like say that Ukraine prevails with current levels of US involvement (so essentially no impact on the debt). What does that imply for "the US"? Perhaps some entitles stop transacting with "the US"? Which ones?

rcarr 3y ago
Dalio explains it better than I'll ever be able to, I've timestamped the video to the relevant part here: https://youtu.be/xguam0TKMw8?si=j1n3nJqbsX2YJHLj&t=1921 https://youtu.be/xguam0TKMw8?si=j1n3nJqbsX2YJHLj&t=1921 The general gist is that the dominant country is in so much debt, and the scale of the devaluation through money printing to get rid of the debt is so great, that it can no longer afford to maintain the global infrastructure necessary to keep its dominant super power status and simultaneously service it's debts so the countries who are buying the debt (which is what grant it it's reserve currency status) look for a safer country to invest in and that becomes the new reserve currency. If it's just the Ukraine war, the US is probably fine and can get it's debts down if it makes the necessary moves to resolve internal problems. If the war extends to more fronts, then it could feasibly end up exactly like the UK where it wins the war but loses the status as dominant currency.