I was born and grew up in the western world, and specifically in Canada. I've always lived in a world with a fairly strong central government as well as the 1983 constitution act which at least on paper suggests we have a number of civil rights enshrined in law, so this is where I'm coming from. On the other hand, I've also been persuaded in part by politicians like Ron Paul as to the power of smaller government. I don't think entirely that libertarianism is the answer to every question, but especially in light of the reality of the growing government compared to the rest of the economy, it seems an inevitable future. Of course I grew up in a Judeo-Christian world, and that worldview is weird in its deep care for the downtrodden which I've inherited. Perhaps the more correct answer is to disregard the downtrodden, but it's a fundamental value I can't ignore. All that being said, this whole essay is not an attempt to codify my beliefs, but to push them to find fresh territory. The conclusions I'm coming to here are not the comfortable answers I would have considered in the past, but a whole new set of ideas based on a new worldview considering the future to be a much different, more hostile place than the recent past. In some ways they may look similar, but I extended the lens to look at things from several points of view I previously never would have in an economic or geopolitical context.
during the late 1990s to the late 2000s, Canada was one of the only countries to balance its federal budget and pay back a substantial amount of its federal debt, and up until 2015 it seemed that could be a trend that would continue. This was significant empirical evidence that a modern federal government could balance its budget and continue providing high levels of service to the population. Despite this, I've come to change my mind based on a number of factors, including the incoming demographic shifts where first much of the population will grow old and stop working and need to be supported by the youth, and second the advances of previous decades such as the development and refinement of the microchip and the development of the Internet that allowed for large scale economic expansion have slowed considerably, with Moore's law being completely dead for a long time now. I'll discuss more of the things I've seen as we go.
I've been having a really hard time because people say "austerity" is the big problem in western countries, but in reality, the government isn't at all austere. The spending as a % of GDP is near all-time highs, and in many countries peaked during the COVID pandemic at over 60%, meaning the government was almost all of the economy and private business was a minority. Even now, however, it's around 50%. That includes the UK which considers itself as living under austerity because a lot of cuts to stuff people see happened, despite not really becoming much less as % of GDP. Some people consider cuts to public services to be "austerity" regardless of total government spending or debt, but I'd have to disagree -- austerity is about reducing services for the purpose of reducing spending and paying off debt, which didn't happen.
110 years ago, most countries had no income tax. None. You didn't need to pay for such a thing. In World War 1 it was brought in as a tax on the ultra-rich, and by the end of World War 2 it was in full effect. Today, you can be a blue-collar worker and start bumping against a 50% marginal tax rate in many places, meaning for every extra dollar you get, the government gets a dollar. They're getting more money than in history. That's not austerity, it's crushing levels of taxation.
So, it seems clear to me that the problem isn't austerity per se, but that the government is taking in all this money and not using it wisely. Canada has added 1 trillion dollars to the federal debt in the past 15 years, tripling it. The US has added 16 trillion to its debt at the same time, also tripling it. Taxation may have gone up or down, but really in neither direction by that much.
In both countries, you sort of need to ask: Where did the money go? What did they spend all this money on?
Some might point out that the government didn't do nearly as much as they do today, and I'd agree that's true, but I'd also suggest that what government does today simply isn't sustainable, and everyone is going to lose everything at this rate, we'll all belong to whatever banker bought the bonds last. During the largest economic boom in the history of the world governments grew to take over functions such as protecting the unemployed and providing healthcare. You can do stuff like that during the largest economic boom in the history of the world, but how about during an irreversible crash?
One place the money has "gone" is that it just wasn't made in the first place. For a human being, you are born and spend some money to get started, then you progressively put more money away as you become more financially affluent, with the understanding that one day you will retire. In the same way, the lifecycle of the world's economies since World War 2 has gone similarly, but unlike a human being who runs up debts then pays them down and then actually puts money away for retirement, people say "government debt is different", and so running it up in perpetuity is ok (despite overwhelming evidence to the contrary). The numbers may have gone up and up and up, but if food is way up and shelter is way up, and the proportion of a person's paycheque that represents is way up, then are the numbers *really* up and up and up, or is the stuff you need to not die more expensive than ever and the economy is actually less productive than in the past?
Most western economies went from mostly making things to mostly selling stuff other people made. Is this really a more productive economy? I'd say it probably isn't. In that case, part of the problem is that like a retiree spending just as much as they spent while working and racking up debt, world governments peaked in their actual productivity in the 20th century and have been masking that fact through doctored numbers, and the overwhelming government (and personal) debt burdens represent the disconnect between government largesse and the actual ability of society to do the things government has promised with the productive economy we have left. In that sense, the government making up so much of GDP is a bug, not a feature -- the government isn't productive, so the more of it there is for the same GDP, the less products and services there are to be bought by anyone.
Billionaires as a class are much older today than 20 years ago. The most famous recent billionaire, Elon Musk, started his career creating goods and services for people, but his real fortune came about by engaging with a government pet project (electric cars) and a government pet project (spacecraft), but most importantly, he didn't make his money by serving many customers, but instead he made his money by convincing the market to buy his stocks. Apple was previously the world's most valuable stock, but they also produced a product that billions of people bought, and multiple times, at increasing prices.
Even Apple's success in 2007 belies a fundamental difference in the economy, however. At one point, if you bought an Intel CPU it was made in America's Silicon Valley, and if you bought an AMD CPU it was made in Dresden, Germany. Today, both are made in Taiwan by TMSC, a Taiwan company which is on track to being one of the largest companies on earth.
There's been some talk that maybe western economies can just do that -- just be the countries that "focusing on high value services and intellectual property". In essence, the idea is that western companies can design stuff and manage factories and let other countries do the work.
Western economies "focusing on high value services and intellectual property" is a bad idea that thinks there's something so inherently superior to westerners that they can provide these services and IP despite the fact that it's people in other countries actually engaging with the stuff on a day to day basis and having equal or greater success in education.
For now America does still have giant companies like Intel and AMD and Apple successfully developing products. However, the fact that something is true today doesn't mean it will remain true. Presently Nvidia and TSMC are major players in the market, both Taiwanese companies.
By the numbers, China has better education by than the west, and often innovation comes from the people building the stuff rather than from someone in an office who has never had to work a production line. The west was successful at high value services and IP since it had a generation of people who did work in local factories and the like. Those people are now dying out, and they're being replaced by people who have never had to work on a production line, and they're competing with people in China or Taiwan or other jurisdictions where they had to work on the production line building the units. It's self-evident that the Chinese will surpass the west in high value services and IP. We're already seeing it, with a lot of innovative products being developed in China and Taiwan, such as the aforementioned TSMC and Nvidia.
If there aren't circumstances that will create the next generation that will be innovating at a world class level, then there won't be innovators. As I already mentioned, there aren't new young billionaires being created in America, the class as a whole is aging, and the people making the most money in America are playing financial musical chairs or hold old productive assets rather than innovate new things.
Some people think the answer is more government spending on innovation. If government spending on innovation could cause innovation, then Soviet computers would have been the envy of the world rather than American computers.
The genuine answer is likely for a lot of people to give up their free money and their tight grasp on every aspect of our lives and let people experiment and try things they think might work without the threat of having your entire bloodline wiped out by an omnipresent state. Even in the past century, one reason the west excelled at computers and the Internet is that the state wasn't fast enough to regulate it into non-existence. Would Google have been able to exist if Altavista or Microsoft was able to create a bunch of laws making competition with them virtually illegal?
It means taking risks as a society. It will mean dreadful things happen. On the other hand, it will also mean good things happen. It'll mean that stuff that was worthless in the past will become worth something. The silicon mining industry was just sand until the semiconductor industry made sand into a valuable commodity. Air conditioning did result in a hole in the ozone layer, but it's also saved potentially millions of lives and increased global productivity.
Now, some people might respond to that with "I don't want to take risks, we don't need perpetual economic growth", and fair enough, but I'd respond to that that if you don't need perpetual economic growth, then we need to massively cut back on government because the productive economy to pay for all this government doesn't exist. It'll mean that yes, social security and Medicare and many other programs you personally want will have to go away or be massively reduced. You can't have all this government without a productive economy to pay for it, and that's our problem right now -- we have a similar government to the peak of western economies, but we don't have the productive economies to pay for it.
People will make grand moral arguments as to why the government programs need to exist and can't possibly be ended, but grand moral arguments won't put food in your belly or a roof over your head or that of the needy. It's only because we live in the nation built by people who took risks that we can afford to discuss such things, and with the economy turning the way it is, it's highly likely they will disappear as concerns because people are more concerned with basic survival.
Earlier cases where the government overwhelmed the productive economy went very poorly, including situations like the French Revolution followed by the reign of terror. Spain once had the most powerful colonial empire on earth, but high government spending and high inflation allowed by money creation powered by silver and gold mines in South America led to the country becoming a somewhat backwards minor regional power, while regimes that were more responsible with government spending became new global superpowers.
Now aside from the logical and material view of things, let's look at things from an emotional standpoint. One emotion at work is sympathy. I am sympathetic to people living in tent cities around the world right now, and it feels like a rich society like ours ought to take care of such people. Another is fear for our safety. Knowing that innovation carries risks, you don't really want to take risks because you or someone you care about could be hurt. I am also sympathetic to that; I don't want to be harmed or have the people I care about, or the environment harmed. There's also a level of guilt involved. For people who are doing well, they ask why they are doing well but other people are not, and knowing there's an element of chance to each person's success we don't want to see people suffering with nothing. Sympathy is tempered by a sense of responsibility, because while you are sympathetic to people who are down on their luck you don't want to cause greater harm in helping -- what use is taking one man's home away to hand it to another? Worse than nothing. The fear of safety must be tempered by a brave inquisitiveness and desire for exploration, to find the next new frontier. Our guilt over being successful must be tempered with a pride in accomplishment, but also a certitude that only by increasing the size of the pie can we make sure everyone gets a slice. We must also feel anxiety for our children, the ones we are leaving the burden of debt we refuse to pay back in our lifetimes to. They never asked for this burden, we are thrusting it up on them, potentially to their detriment. We must consider the well-being of those who aren't yet adults or aren't yet born when taking on multi-generational projects. Of course, there's also the point of view of those in need, who would most certainly desire help and in many cases feel the well-being of some nameless future generations should not override their own, since doing the right thing for future generations doesn't fill their bellies. On the other hand, some needy will ask for more in perpetuity, always more, because they're greedy and lazy (not all, but I've met my share of people and even helped some extensively before realizing they wouldn't be happy until they were my unearned equal). You help anyone other than them and suddenly the Goodwill they wanted from you is nowhere to be found. It's a difficult paradox: if you free a bird from a fishing net it may never approach another fishing net, but if you feed a bear then it may come to associate humans with food and so your actions lead to its death. Such complexity might make you want to keep things easy and help everyone or help no one, but reality is going to be messy and complex, and it won't be possible to get all the answers right. That being said, it's still just to at least try to help the most deserving even in an era where we'll need to help fewer out of necessity.
The most rational analysis says that the current way of doing things will not continue. Actual economic growth is slowing and has been for some while. We can see this in part by the stagnation of real wages for decades and per capita productivity, as well as the growing prices of transportation, energy, food, and shelter. If we used the 1980s standard of inflation calculation, we've been in economic decline for decades now, and that better matches with the lived experiences of individuals than the claims that we're richer than ever before today compared to 20 years ago -- that's just absurd on the face of it.
Various places in various parts of history have dealt with these problems in a few ways. One way is the way India dealt with immense suffering -- make it part of the ideology of the region that life is supposed to be suffering and that there's really not much to be done about it, and we should instead strive towards prosocial behaviors that are not promised to help you in the short term, but should make things tolerable without government interference. Indian civilization is notable in that the culture overwhelmed the state for millennia. The west during previous eras considered the needy to be a problem society was tasked with helping with at an individual level, so all of society (besides the government) would want to help the poor through the church, which would leave the state out of matters of welfare and would in that way also ensure people weren't giving more than they could give because they would only give as much as they could stand to lose. Some earlier civilizations had a more domineering stance, suggesting that those who are weak should strive to become strong by their own power rather than asking for help to remain weak. Clan-based societies made it the duty of the family surrounding the poor to aid those who are down on their luck.
A combination of all these cultural remedies will likely be required as the state cannot continue to provide the same level of intervention into the economy and its individuals.
I would agree it's a massive cultural shift, and not one I expect the world will accept lightly, but it's also something societies won't have a choice in. Eventually governments like ours fall because they can't give people that which does not exist after they've choked out the productive economy. Regardless, lessons from the past are likely to be our lodestone for the future as this cultural and governmental change inevitably takes place.
Many people think that a switch to a communist economic system would be helpful. Its goal would be to provide everyone with a basic level of financial security as long as they were working. I don't think this really matches the problem we're facing here. Some people might blame capitalism for this situation, and they'd be correct to the extent that the prosperity brought about by capitalism allowed growth of government services while also providing the common man with enough material goods to accept that. However, instead people think that capitalism is to blame because it is exploitative, and that's the opposite of the problem we're facing here -- capitalism allowed the largesse to people, rather than just sucking largesse up. There are of course the ultra-rich, but the common man's wealth has grown such that in many ways you'd rather be poor today than rich in other eras in history, even with the problems I've described. Ironically, the power of capitalism led to its end, because if more than half the GDP is government, I don't think we can strictly call the current system capitalism.
Instead of looking at it through the lens of the community owning the capital or private interests owning the capital, I can't help but imagine things solely in terms of what the output of capital is going to be. A dictatorial command economy will need to deal with the same capital goods flow issues as a pure capitalist economy, the only questions on top of that are going to be how the goods are distributed. The problem for the future is going to be whether we can make enough physical stuff to meet the expanding demands of a world that needs that stuff. You can borrow money, but you can't borrow stuff that doesn't exist. There are productive industries that don't produce stuff as such, for example intellectual property industries, but at some point, somebody needs a thing, and you can't eat software or movies. As house prices rise compared to wages and food rises compared to wage inflation, that will continue to take up more of the spending in people's budgets, and so the room for such industries will be diminished.
I think we can ask questions about our fundamental suppositions built into the massive mega-states of the west: Is it just to have such a powerful state? It is often assumed that because the stated goals of the state are just that the state itself is just, but is that really the case? Is it fair to have an entity taking on so much of the power over people? What makes us think that the state is going to make the best use of money to help society or the poor? Also, while a large government can have a big positive effect on the environment by forcing companies to conform to environmental regulations, what effects come about due to massive governments existing? What if the large and unaccountable state are using substantial amounts of resources that would not otherwise be necessary, in the same way a major government building will be built to decadent extremes while an individual will build only the building they need for their limited purposes? What effect does a massive government have on our social structures? Does forcing people to give up so much of their income to such a leviathan mean people are less willing to help one another, creating a self-fulfilling prophecy?
What will the effects on the entire world be of what's going on? In Asia, we know that they've followed many western ideas, leading to stagnating birth rates and slowing economic growth, as well as high levels of government debt. This suggests wherever we go, they'll be dealing with similar problems. Russia seems to be dealing with the current situation through violence and the war in Ukraine (which may or may not be the final push from there). Africa's demographics show a brighter near-term future, but that continent has significant issues and has seen its population octuple despite no major improvements in governance or productivity, and it imports most of its food from the west. Indeed, Africa is arguably a major recipient of much of the government spending we've been talking about, and if the size of western governments collapse, it's likely to have a greater effect on the African continent.
Unfortunately, some views of history suggest there is no solution to massive systemic problems like this other than letting it play out as it will. It's possible that no single leader could possibly reverse or even mitigate what I think is coming (and I could be wrong, predicting the future is betting against God and the unlimited ways one can be wrong and the limited number of ways one can be right), so it might just be about trying to limit the damage to your family and community rather than trying to change your province, country, or the world. In some views of ecology, the ecosystem will eventually repair itself and that could involve just letting the diseases die out, so the key is to survive such eras so as to not become extinct. In that sense, human beings can be considered just one part of a broader organism that is life on earth, and like cells in our own bodies will live through the trials and tribulations of the host body but may be cast out if we prove diseased.
during the late 1990s to the late 2000s, Canada was one of the only countries to balance its federal budget and pay back a substantial amount of its federal debt, and up until 2015 it seemed that could be a trend that would continue. This was significant empirical evidence that a modern federal government could balance its budget and continue providing high levels of service to the population. Despite this, I've come to change my mind based on a number of factors, including the incoming demographic shifts where first much of the population will grow old and stop working and need to be supported by the youth, and second the advances of previous decades such as the development and refinement of the microchip and the development of the Internet that allowed for large scale economic expansion have slowed considerably, with Moore's law being completely dead for a long time now. I'll discuss more of the things I've seen as we go.
I've been having a really hard time because people say "austerity" is the big problem in western countries, but in reality, the government isn't at all austere. The spending as a % of GDP is near all-time highs, and in many countries peaked during the COVID pandemic at over 60%, meaning the government was almost all of the economy and private business was a minority. Even now, however, it's around 50%. That includes the UK which considers itself as living under austerity because a lot of cuts to stuff people see happened, despite not really becoming much less as % of GDP. Some people consider cuts to public services to be "austerity" regardless of total government spending or debt, but I'd have to disagree -- austerity is about reducing services for the purpose of reducing spending and paying off debt, which didn't happen.
110 years ago, most countries had no income tax. None. You didn't need to pay for such a thing. In World War 1 it was brought in as a tax on the ultra-rich, and by the end of World War 2 it was in full effect. Today, you can be a blue-collar worker and start bumping against a 50% marginal tax rate in many places, meaning for every extra dollar you get, the government gets a dollar. They're getting more money than in history. That's not austerity, it's crushing levels of taxation.
So, it seems clear to me that the problem isn't austerity per se, but that the government is taking in all this money and not using it wisely. Canada has added 1 trillion dollars to the federal debt in the past 15 years, tripling it. The US has added 16 trillion to its debt at the same time, also tripling it. Taxation may have gone up or down, but really in neither direction by that much.
In both countries, you sort of need to ask: Where did the money go? What did they spend all this money on?
Some might point out that the government didn't do nearly as much as they do today, and I'd agree that's true, but I'd also suggest that what government does today simply isn't sustainable, and everyone is going to lose everything at this rate, we'll all belong to whatever banker bought the bonds last. During the largest economic boom in the history of the world governments grew to take over functions such as protecting the unemployed and providing healthcare. You can do stuff like that during the largest economic boom in the history of the world, but how about during an irreversible crash?
One place the money has "gone" is that it just wasn't made in the first place. For a human being, you are born and spend some money to get started, then you progressively put more money away as you become more financially affluent, with the understanding that one day you will retire. In the same way, the lifecycle of the world's economies since World War 2 has gone similarly, but unlike a human being who runs up debts then pays them down and then actually puts money away for retirement, people say "government debt is different", and so running it up in perpetuity is ok (despite overwhelming evidence to the contrary). The numbers may have gone up and up and up, but if food is way up and shelter is way up, and the proportion of a person's paycheque that represents is way up, then are the numbers *really* up and up and up, or is the stuff you need to not die more expensive than ever and the economy is actually less productive than in the past?
Most western economies went from mostly making things to mostly selling stuff other people made. Is this really a more productive economy? I'd say it probably isn't. In that case, part of the problem is that like a retiree spending just as much as they spent while working and racking up debt, world governments peaked in their actual productivity in the 20th century and have been masking that fact through doctored numbers, and the overwhelming government (and personal) debt burdens represent the disconnect between government largesse and the actual ability of society to do the things government has promised with the productive economy we have left. In that sense, the government making up so much of GDP is a bug, not a feature -- the government isn't productive, so the more of it there is for the same GDP, the less products and services there are to be bought by anyone.
Billionaires as a class are much older today than 20 years ago. The most famous recent billionaire, Elon Musk, started his career creating goods and services for people, but his real fortune came about by engaging with a government pet project (electric cars) and a government pet project (spacecraft), but most importantly, he didn't make his money by serving many customers, but instead he made his money by convincing the market to buy his stocks. Apple was previously the world's most valuable stock, but they also produced a product that billions of people bought, and multiple times, at increasing prices.
Even Apple's success in 2007 belies a fundamental difference in the economy, however. At one point, if you bought an Intel CPU it was made in America's Silicon Valley, and if you bought an AMD CPU it was made in Dresden, Germany. Today, both are made in Taiwan by TMSC, a Taiwan company which is on track to being one of the largest companies on earth.
There's been some talk that maybe western economies can just do that -- just be the countries that "focusing on high value services and intellectual property". In essence, the idea is that western companies can design stuff and manage factories and let other countries do the work.
Western economies "focusing on high value services and intellectual property" is a bad idea that thinks there's something so inherently superior to westerners that they can provide these services and IP despite the fact that it's people in other countries actually engaging with the stuff on a day to day basis and having equal or greater success in education.
For now America does still have giant companies like Intel and AMD and Apple successfully developing products. However, the fact that something is true today doesn't mean it will remain true. Presently Nvidia and TSMC are major players in the market, both Taiwanese companies.
By the numbers, China has better education by than the west, and often innovation comes from the people building the stuff rather than from someone in an office who has never had to work a production line. The west was successful at high value services and IP since it had a generation of people who did work in local factories and the like. Those people are now dying out, and they're being replaced by people who have never had to work on a production line, and they're competing with people in China or Taiwan or other jurisdictions where they had to work on the production line building the units. It's self-evident that the Chinese will surpass the west in high value services and IP. We're already seeing it, with a lot of innovative products being developed in China and Taiwan, such as the aforementioned TSMC and Nvidia.
If there aren't circumstances that will create the next generation that will be innovating at a world class level, then there won't be innovators. As I already mentioned, there aren't new young billionaires being created in America, the class as a whole is aging, and the people making the most money in America are playing financial musical chairs or hold old productive assets rather than innovate new things.
Some people think the answer is more government spending on innovation. If government spending on innovation could cause innovation, then Soviet computers would have been the envy of the world rather than American computers.
The genuine answer is likely for a lot of people to give up their free money and their tight grasp on every aspect of our lives and let people experiment and try things they think might work without the threat of having your entire bloodline wiped out by an omnipresent state. Even in the past century, one reason the west excelled at computers and the Internet is that the state wasn't fast enough to regulate it into non-existence. Would Google have been able to exist if Altavista or Microsoft was able to create a bunch of laws making competition with them virtually illegal?
It means taking risks as a society. It will mean dreadful things happen. On the other hand, it will also mean good things happen. It'll mean that stuff that was worthless in the past will become worth something. The silicon mining industry was just sand until the semiconductor industry made sand into a valuable commodity. Air conditioning did result in a hole in the ozone layer, but it's also saved potentially millions of lives and increased global productivity.
Now, some people might respond to that with "I don't want to take risks, we don't need perpetual economic growth", and fair enough, but I'd respond to that that if you don't need perpetual economic growth, then we need to massively cut back on government because the productive economy to pay for all this government doesn't exist. It'll mean that yes, social security and Medicare and many other programs you personally want will have to go away or be massively reduced. You can't have all this government without a productive economy to pay for it, and that's our problem right now -- we have a similar government to the peak of western economies, but we don't have the productive economies to pay for it.
People will make grand moral arguments as to why the government programs need to exist and can't possibly be ended, but grand moral arguments won't put food in your belly or a roof over your head or that of the needy. It's only because we live in the nation built by people who took risks that we can afford to discuss such things, and with the economy turning the way it is, it's highly likely they will disappear as concerns because people are more concerned with basic survival.
Earlier cases where the government overwhelmed the productive economy went very poorly, including situations like the French Revolution followed by the reign of terror. Spain once had the most powerful colonial empire on earth, but high government spending and high inflation allowed by money creation powered by silver and gold mines in South America led to the country becoming a somewhat backwards minor regional power, while regimes that were more responsible with government spending became new global superpowers.
Now aside from the logical and material view of things, let's look at things from an emotional standpoint. One emotion at work is sympathy. I am sympathetic to people living in tent cities around the world right now, and it feels like a rich society like ours ought to take care of such people. Another is fear for our safety. Knowing that innovation carries risks, you don't really want to take risks because you or someone you care about could be hurt. I am also sympathetic to that; I don't want to be harmed or have the people I care about, or the environment harmed. There's also a level of guilt involved. For people who are doing well, they ask why they are doing well but other people are not, and knowing there's an element of chance to each person's success we don't want to see people suffering with nothing. Sympathy is tempered by a sense of responsibility, because while you are sympathetic to people who are down on their luck you don't want to cause greater harm in helping -- what use is taking one man's home away to hand it to another? Worse than nothing. The fear of safety must be tempered by a brave inquisitiveness and desire for exploration, to find the next new frontier. Our guilt over being successful must be tempered with a pride in accomplishment, but also a certitude that only by increasing the size of the pie can we make sure everyone gets a slice. We must also feel anxiety for our children, the ones we are leaving the burden of debt we refuse to pay back in our lifetimes to. They never asked for this burden, we are thrusting it up on them, potentially to their detriment. We must consider the well-being of those who aren't yet adults or aren't yet born when taking on multi-generational projects. Of course, there's also the point of view of those in need, who would most certainly desire help and in many cases feel the well-being of some nameless future generations should not override their own, since doing the right thing for future generations doesn't fill their bellies. On the other hand, some needy will ask for more in perpetuity, always more, because they're greedy and lazy (not all, but I've met my share of people and even helped some extensively before realizing they wouldn't be happy until they were my unearned equal). You help anyone other than them and suddenly the Goodwill they wanted from you is nowhere to be found. It's a difficult paradox: if you free a bird from a fishing net it may never approach another fishing net, but if you feed a bear then it may come to associate humans with food and so your actions lead to its death. Such complexity might make you want to keep things easy and help everyone or help no one, but reality is going to be messy and complex, and it won't be possible to get all the answers right. That being said, it's still just to at least try to help the most deserving even in an era where we'll need to help fewer out of necessity.
The most rational analysis says that the current way of doing things will not continue. Actual economic growth is slowing and has been for some while. We can see this in part by the stagnation of real wages for decades and per capita productivity, as well as the growing prices of transportation, energy, food, and shelter. If we used the 1980s standard of inflation calculation, we've been in economic decline for decades now, and that better matches with the lived experiences of individuals than the claims that we're richer than ever before today compared to 20 years ago -- that's just absurd on the face of it.
Various places in various parts of history have dealt with these problems in a few ways. One way is the way India dealt with immense suffering -- make it part of the ideology of the region that life is supposed to be suffering and that there's really not much to be done about it, and we should instead strive towards prosocial behaviors that are not promised to help you in the short term, but should make things tolerable without government interference. Indian civilization is notable in that the culture overwhelmed the state for millennia. The west during previous eras considered the needy to be a problem society was tasked with helping with at an individual level, so all of society (besides the government) would want to help the poor through the church, which would leave the state out of matters of welfare and would in that way also ensure people weren't giving more than they could give because they would only give as much as they could stand to lose. Some earlier civilizations had a more domineering stance, suggesting that those who are weak should strive to become strong by their own power rather than asking for help to remain weak. Clan-based societies made it the duty of the family surrounding the poor to aid those who are down on their luck.
A combination of all these cultural remedies will likely be required as the state cannot continue to provide the same level of intervention into the economy and its individuals.
I would agree it's a massive cultural shift, and not one I expect the world will accept lightly, but it's also something societies won't have a choice in. Eventually governments like ours fall because they can't give people that which does not exist after they've choked out the productive economy. Regardless, lessons from the past are likely to be our lodestone for the future as this cultural and governmental change inevitably takes place.
Many people think that a switch to a communist economic system would be helpful. Its goal would be to provide everyone with a basic level of financial security as long as they were working. I don't think this really matches the problem we're facing here. Some people might blame capitalism for this situation, and they'd be correct to the extent that the prosperity brought about by capitalism allowed growth of government services while also providing the common man with enough material goods to accept that. However, instead people think that capitalism is to blame because it is exploitative, and that's the opposite of the problem we're facing here -- capitalism allowed the largesse to people, rather than just sucking largesse up. There are of course the ultra-rich, but the common man's wealth has grown such that in many ways you'd rather be poor today than rich in other eras in history, even with the problems I've described. Ironically, the power of capitalism led to its end, because if more than half the GDP is government, I don't think we can strictly call the current system capitalism.
Instead of looking at it through the lens of the community owning the capital or private interests owning the capital, I can't help but imagine things solely in terms of what the output of capital is going to be. A dictatorial command economy will need to deal with the same capital goods flow issues as a pure capitalist economy, the only questions on top of that are going to be how the goods are distributed. The problem for the future is going to be whether we can make enough physical stuff to meet the expanding demands of a world that needs that stuff. You can borrow money, but you can't borrow stuff that doesn't exist. There are productive industries that don't produce stuff as such, for example intellectual property industries, but at some point, somebody needs a thing, and you can't eat software or movies. As house prices rise compared to wages and food rises compared to wage inflation, that will continue to take up more of the spending in people's budgets, and so the room for such industries will be diminished.
I think we can ask questions about our fundamental suppositions built into the massive mega-states of the west: Is it just to have such a powerful state? It is often assumed that because the stated goals of the state are just that the state itself is just, but is that really the case? Is it fair to have an entity taking on so much of the power over people? What makes us think that the state is going to make the best use of money to help society or the poor? Also, while a large government can have a big positive effect on the environment by forcing companies to conform to environmental regulations, what effects come about due to massive governments existing? What if the large and unaccountable state are using substantial amounts of resources that would not otherwise be necessary, in the same way a major government building will be built to decadent extremes while an individual will build only the building they need for their limited purposes? What effect does a massive government have on our social structures? Does forcing people to give up so much of their income to such a leviathan mean people are less willing to help one another, creating a self-fulfilling prophecy?
What will the effects on the entire world be of what's going on? In Asia, we know that they've followed many western ideas, leading to stagnating birth rates and slowing economic growth, as well as high levels of government debt. This suggests wherever we go, they'll be dealing with similar problems. Russia seems to be dealing with the current situation through violence and the war in Ukraine (which may or may not be the final push from there). Africa's demographics show a brighter near-term future, but that continent has significant issues and has seen its population octuple despite no major improvements in governance or productivity, and it imports most of its food from the west. Indeed, Africa is arguably a major recipient of much of the government spending we've been talking about, and if the size of western governments collapse, it's likely to have a greater effect on the African continent.
Unfortunately, some views of history suggest there is no solution to massive systemic problems like this other than letting it play out as it will. It's possible that no single leader could possibly reverse or even mitigate what I think is coming (and I could be wrong, predicting the future is betting against God and the unlimited ways one can be wrong and the limited number of ways one can be right), so it might just be about trying to limit the damage to your family and community rather than trying to change your province, country, or the world. In some views of ecology, the ecosystem will eventually repair itself and that could involve just letting the diseases die out, so the key is to survive such eras so as to not become extinct. In that sense, human beings can be considered just one part of a broader organism that is life on earth, and like cells in our own bodies will live through the trials and tribulations of the host body but may be cast out if we prove diseased.
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