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How A Country Dies

General Ideas

A country dies slowly.

Those living during the decline of Rome were likely unaware that anything was happening. The decline took over a couple of hundred years. Anyone living during the decline only saw a small part of what was happening and likely never noticed it as anything other than ordinary.

Countries don’t have genetically determined life spans. Nor do they die quickly, unless the cataclysm of some great war does them in. Even in such extreme cases, there are usually warning signs, which are more obvious in hindsight than at the time.

Few citizens of a dying nation recognize the signs. Most are too busy trying to live their lives, sometimes not an easy task.  If death occupies their mind, it is with respect to themselves, a relative or a friend. Most cannot conceive of the death of a nation.

A Country Dies Slowly First

For those interested, signs or symptoms precede death for a country often as they do for a person. There is a pattern that involves the following:

1. The Economy

Economically, people become poorer. It becomes harder to feed a family. Economic growth stalls and then reverses. Work opportunities decline. Disincentives to work rise as government tries to ease the burden on the unemployed and lower skilled. These efforts require more revenues which means higher taxes or debt financing. Disincentives to create jobs are magnified by attempts to address the problem. Higher taxes and other burdens are imposed on the productive making work less attractive.

The response should not be surprising. Capital flees first. It goes to areas where adequate returns are still available. Jobs are created but not in the host country. Finally a “brain drain” begins. Talented people leave the country for places that offer greater opportunity. In the case of the US, to escape US taxes these people must renounce their citizenship. Citizenship renouncements are currently at the highest levels in the history.

The flight of capital, both real and human, further  lowers standards of living. Signs of stagnation become more apparent. They may begin as seemingly benign as roads which have too many potholes. “For rent” signs are seen more frequently. Classified job ads  decrease. “Going out of Business” sales are no longer marketing gimmicks.

Initially, people dig into their savings or begin to borrow in order to retain their standard of living. Most believe it is a temporary situation. Eventually bankruptcies increase. Strip or full malls close. Large areas like Detroit become close to uninhabitable.

These conditions characterize the beginnings of the decline. As the decline continues, things get much worse.

2. The State

The State is threatened by a decline. Generally it moves into full pretend mode. Three behavioral traits characterize its behavior. The State must convince citizens:

  1. things are not as bad as they seem.
  2. the State is not responsible for the situation.
  3.  the State must do more (grow bigger) in order to solve the problems.

Statistics issued by the State are fudged to convey a false image of well-being. Government spending soars in an effort to juice reported economic activity. Much of the spending is unproductive in terms of providing things that would have otherwise been bought. It is also counterproductive to a proper functioning economy as price discovery is disrupted and consumer and investment decisions are based on false signals.

Incentives are  provided to encourage people to live beyond their means.  Debt appears nearly free and readily available. Bubbles occur and then burst. New bubbles are necessary to replace old bubbles. People and businesses are encouraged to make imprudent decisions, all in the attempt to make the economy appear better.

The State has one objective and that is to remain in power. Laws and regulations  multiply at ever faster rates. Tyrannical rules and legislation are passed under the pretense of protecting the people against some threat. In reality, these laws are passed to protect the leaders against the public when they finally understand what has been done to them.

“Bread and circuses” increase to divert peoples attention from the developing problems. Dependency increases reflecting an attempt to placate the masses. A “wag the dog” war or crisis is often used as a means to rally the public against some phony enemy.

3. Society

Society becomes coarsens as this process progresses. People increasingly are unable to provide properly for their families. Some desperately turn to unethical behavior, even criminal acts.   Common decency declines.

The regulations imposed from above reduce the sphere of voluntary interactions between people. The government decides more and more what you must do, when and how you must do it. What you can say comes under attack. Finally how you must live is increasingly determined.

Free markets are slowly replaced by a command and control ordering of society. Coercion displaces freedom as the coordinating force for society. People increasingly do what they must rather than what they want.

Interest groups, i.e. politically preferred constituents, created in good times don’t demand less when there is less available. The inability to meet their demands creates political strife and eventually civil problems. Honoring their demands divides society even more. Not honoring demands may produce rioting and civil unrest.

Societybecomes increasingly divided in terms of the “makers” and the “takers.”  As the takers grow in numbers, the makers shrink in numbers. Soon the parasites overwhelm the productive. Society collapses at that point.

Are The People Aware?

The United States, the once beacon of freedom and wealth, shows advanced deterioration  in all three areas above. The rate of deterioration is accelerating. To paraphrase Ernest Hemingway’s response to a bankruptcy question:

How did your country die? Two ways. Gradually, then suddenly.

Do people understand what is happening to them and their country? I suspect they are not aware of the full consequences. Most people are not trained to think in these terms, nor should they be. For most of us, it is a chore to get through each day. That is true of the dullards and the brilliant, for most of us end up at levels that tax our abilities.

People sense there is something wrong even though they may be unable to identify what that something might be. Many probably believe that whatever is happening is temporary, sort of like an economic slowdown that reverts back to normal. For them, it is tighten the belt until the good times return.

The results from a recent Gallup poll are interesting and illustrate the increasing dissatisfaction:

polldata

Numerous observations could be made regarding many of these institutions. All have decreased in favorability. Gallup was definitive in this regard:

The current 7% of Americans who place confidence in Congress is the lowest of the 17 institutions Gallup measured this year, and is the lowest Gallup has ever found for any of these institutions. The dearth of public confidence in their elected leaders on Capitol Hill is yet another sign of the challenges that could face incumbents in 2014′s midterm elections — as well as more broadly a challenge to the broad underpinnings of the nation’s representative democratic system.

The  poll is not a direct measure of the health of the nation. However, it provides a very negative composite of public satisfaction.  People know they are unhappy even if they don’t know the cause of their unhappiness.

This confusion and distrust always  precedes the death of a nation.

Economic Noise blog



16 Comments on "How A Country Dies"

  1. louis wu on Mon, 23rd Jun 2014 9:17 am 

    Allowing people to use local land to grow food would become their new “jobs” but that won’t be allowed because they would become independent of the state and what free markets? There are not now and maybe never were any actual “free markets”.

  2. Juan Pueblo on Mon, 23rd Jun 2014 11:21 am 

    I found the Gallup poll data interesting. I had no idea the military was so well regarded, more than any other institution polled, in the USA. Three out of four Americans have a good opinion of the military. This will come in handy when push comes to shove.

  3. J-Gav on Mon, 23rd Jun 2014 11:30 am 

    I would say there are some cogent remarks in this piece and even the satisfaction poll is interesting to mull over.

    However, it all starts with a somewhat muddled conflation. The author begins by talking about the Roman Empire (which was not ‘a country’) and then proceeds to talk about the death of countries.

    Portugal, Spain, the Netherlands, France, England … all had empires, which have now ceased to exist as such. But the countries remain.

    You’d think that, in an article meant to explain how “countries die,” you’d find at least one example of a ‘dead’ country …

  4. Fishman on Mon, 23rd Jun 2014 12:48 pm 

    Ah, the Obama years.

    The State
    #4. I just found out about it in the news today – BHO

  5. noobtube on Mon, 23rd Jun 2014 2:01 pm 

    Anyone who says the United States was a beacon of FREEDOM is clearly insane.

    You don’t get WEALTH unless you restrict FREEDOM.

    And, no nation spreads tyranny and oppression like the United States (I guess they learned well from the British).

  6. HARM on Mon, 23rd Jun 2014 2:22 pm 

    “Society becomes increasingly divided in terms of the “makers” and the “takers.” As the takers grow in numbers, the makers shrink in numbers. Soon the parasites overwhelm the productive. Society collapses at that point.”

    Typical Teapublican right-wing rant conflating the actual “takers” (rentier elites) with the working class (the actual “makers”, i.e., people who do real work for a living vs. “earning” profits from inherited capital).

    In any case, I much prefer Orlov’s “Five stages of Collapse” as a far more nuanced, developed and accurate model of how collapse happens.

  7. Pops on Mon, 23rd Jun 2014 4:03 pm 

    I like these kind of posts, everything is presented as settled fact – yet there is not a citation in sight. Looks like me, LOL

    I agree the poll is interesting tho. In fact if you took the list and turned it upside down you would probably see how it looked in ’72 or so when soldiers were baby killers and Walter Cronkite was everyones’ Uncle. Congress wasn’t necessarily popular but it was in the 40’s (according to a quick Google)

  8. Northwest Resident on Mon, 23rd Jun 2014 5:36 pm 

    Let’s just sum it up in a single sentence. Everything goes great until the greedy power-craving sociopaths manipulate their way to the top, and once they get into the driver’s seat it is all downhill from there on.

  9. Tedman on Mon, 23rd Jun 2014 6:26 pm 

    North, when have greedy power-craving sociopaths not been in the driver seat?

  10. Northwest Resident on Mon, 23rd Jun 2014 8:26 pm 

    Tedman, in answer to your question, long ago in a land far far away. I’ve posted on this forum my thoughts on sociopaths before — how they once played a valuable role in the success of tribes and nation-states as they battled for control over resources throughout the history of humanity. But these days we find ourselves in a situation where the very personality types that once lead nations and tribes to victory over the competition have resorted to preying on the people that they pretend to lead. It is a sordid situation, and one that can’t last forever.

  11. hculliton on Mon, 23rd Jun 2014 8:49 pm 

    Tedman: of course greedy power-hungry sociopaths have always sought political power. It’s axiomatic that the folks who crave power are the very ones who should never be given the opportunity to get it. But in the American experience, up until the 1980’s the Constitution was enforced and able to keep them on a short leash. However, like the Joker breaking out of Arkham, they’ve slipped free. Now it might be too late to wrest power back form them.

  12. Norm on Mon, 23rd Jun 2014 9:47 pm 

    USA will die all at o cd from massive heart attack. Like 400 pounder pigging at Olive Garden.

  13. Norm on Mon, 23rd Jun 2014 10:11 pm 

    Pops, lovin your upside down list. Brilliant! True! Nowadays the fat majority worships the military and violent video games. Do a google images search on ‘ Rambo Jesus ‘ it all makes sense.

  14. Makati1 on Mon, 23rd Jun 2014 10:19 pm 

    “How did your country die? Two ways. Gradually, then suddenly.”

    The epitaph of the USSA.

  15. Arthur2 on Tue, 24th Jun 2014 2:46 am 

    The most important reason why countries die is not mentioned by the article: migration patterns and shifting demographics. That’s why countries blow up: a ruling ethnicity/religeous group being replaced by another. Recent examples: Yugoslavia, Iraq, Lybia, Syria. Ask the American Indians how their ‘immigration policies’ and ‘why can’t we all get along’ worked out for them. In the best case you end up in a reservation with two wounded knees. The world of Islam has infite supply of angry young men with guns, where foolish euros want to convince themselves that they can escape harsh darwinian realities by playing Albert Schweitzer. They are in for a rude awakening.

    But obviously these truisms are pearls for the swines, who still believe in ‘economic noise’.

  16. rollin on Tue, 24th Jun 2014 9:11 pm 

    The name may be the same but it’s not the same nation anymore. So it’s already disappeared and what we are seeing now is the settling in of the new regime.
    Too many citizens asleep at the switch or spending time in front of the TV and at the mall.

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