Collapse by 2050

A leaked Chinese geopolitical strategy document reveals China’s self-confidence. The document predicts, “The US and Western Europe will collapse due to cultural and demographic conflict by 2050.” China’s leaders increasingly see multiculturalism as “cultural suicide” and believe the west is dying because of it.

—CNN

The Chinese aren’t wrong, although my 2004 estimate for the initial breakup of the USA as a unitary political entity is 2033. The EU has already begun to break apart and the centrifugal forces will continue to grow stronger with the failure of its economic war against Russia. The USA, the UK, and every Western European country are either going to collapse into a violent partition like India circa 1947 or embark upon ethnic cleansing on a larger scale than the Israelis are currently applying to Gaza.

Multiculturalism isn’t just cultural suicide, it is societal suicide, which is arguably worse. The Chinese know this; Xi is not only smart, and not only has the benefit of being advised by Wang Hunin and other brilliant historical philosophers, but is also a student of the greatest political mind of the 20th Century, Lee Kwan Yew. So he knows what we all know, and what Clown World refuses to accept, about multiculturalism.

That’s why Russia is now selling 106 billion cubit tons of natural gas to China every year in lieue of the 160 billion cubic tons it used to sell annually to Western Europe. The Russians, too, know who is going to win in the long run.

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The Dragon and the Elephant

In its futile attempts to keep control of the West, Clown World has completely botched the two primary geostrategic priorities of the imperial USA.

  • Prevent an effective alliance between Russia and China
  • Keep India on the team

Clown World is clearly cooked at this point, even if it somehow manages to fix its growing number of self-inflicted problems in the USA, the UK, and the EU, which it won’t, because it can’t.

I also note the obvious falsehood of all the clowns shilling the idea that Xi has lost power. That clearly is not the case, as evidenced by the starring role he is playing at what appears to be the most significant global meeting since the Potsdam Conference, the current Tianjin Summit that is the 25th meeting of the Shanghai Cooperation Organization that ends today in China.

The day of the Zombie Lion and the Exhausted Eagle is done.

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Credit Card Outage in France

And so it begins… Be sure to keep some cash handy at all times.

  • France may be heading for an IMF bailout, warns French Finance Minister
  • Predictions that the minority government will fall next week have spooked the markets, adding to the problems of a massive national debt.
  • France risks seeking a bailout from the International Monetary Fund as its government teeters on the brink of collapse, its finance minister has warned.
  • Crédit Mutuel, and CIC, are the major named banks in a nationwide payment outage starting this afternoon around 5:30 PM CEST. There has been no comment from the banks, and no info has been placed on their websites. People all over France are now unable to pay for groceries, unable to withdraw cash, some are stuck at highway tolls and railway stations on a Saturday afternoon. Many French are doing back-to-school shopping as the school year starts Monday, but they can’t pay for what they need to buy. No word on what caused the outage or when it will be resolved.
  • A massive outage is hitting several French banks, including Crédit Mutuel, CIC, Crédit Agricole, and Société Générale: card payments and withdrawals are IMPOSSIBLE. Toll booths are JAMMED with holiday traffic, and card terminals are showing declined payments.

I assume Clown World will manage to muddle through this initial bank crisis one way or another. But it’s not going to be the last one, as the combination of refusing to buy Russian gas and massive spending on Ukraine and unproductive migrants has destroyed the French, German, and UK economies.

It’s likely to be a interesting autumn. It should be a good time to stay in, read some good books, and generally keep things conservative.

UPDATE: all the cash machines were offline in my part of Scotland yesterday.

Shades of October 2008, but this time it will almost certainly be on a larger scale.

UPDATE: Not to worry, it’s just the IT department enhancing the French user experience. Or so we’re informed.

According to a spokesperson for Crédit Mutuel, the issue stemmed from an internal bug affecting payment acceptance for cardholders of the three banks. Reports suggest the problem arose following a routine computer update, preventing the system from verifying account balances during transactions, leading to widespread payment refusals. Crucially, other banking services, such as bank transfers, remained operational, indicating the issue was isolated to card payment processing.

Yet another justification for UATV’s move away from credit cards.

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Trump’s Tariffs Overturned

I very much doubt the recent federal appeals court ruling striking down President Trump’s emergency tariffs is going to survive Supreme Court review:

A federal appeals court on Friday struck down President Donald Trump’s use of emergency powers granted by Congress to impose tariffs, opening the door for the administration to potentially have to repay billions worth of duties.

The 7-4 ruling raises doubt about deals Trump has struck with the European Union, Japan, South Korea and other major trading partners to reduce the “reciprocal” tariff rates on their imports, from the levels the administration originally set in April.

“We conclude Congress … did not give the president wide-ranging authority to impose tariffs” of the kind Trump imposed in his sweeping executive orders, the majority wrote.

The ruling also invalidates the tariffs that Trump has imposed on China, Canada and Mexico to pressure those countries to do more to stop shipments of fentanyl and precursor chemicals from entering the United States.

The decision, however, will not take effect until Oct. 14, giving the Trump administration time to appeal the decision to the Supreme Court.

The fact is that Congress already delegated the necessary power to the Executive Branch more than 50 years ago. This is why President Trump declared his tariffs to be necessary due to national security concerns, which are considerably more valid than the average “national security concern” that is utilized to justify so many federal government actions.

Historically, Congress set tariffs and maintained tight control over this power. However, over time, particularly after the Great Depression, there was a shift towards delegating some authority to the executive branch. This began with the Reciprocal Trade Agreements Act of 1934, allowing the President to negotiate trade agreements without separate congressional approval each time. Later acts, such as the Trade Expansion Act of 1962 and the Trade Act of 1974, further evolved this delegated authority. These allowed the President to act on national security concerns through tariffs or respond to unfair foreign trade practices.

And anyhow, all President Trump has to do is declare an “emanation” or a “penumbra” and he’ll be good to go. September promises to be an interesting month in more ways than one.

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Perhaps More Sanctions on Russia Would Help

Both Great Britain and Germany are teetering on the brink of economic crises:

Britain is facing the prospect of a repeat of its crippling 1976 economic crash as soaring debt and borrowing costs raise doubts over Labour’s budget policies, leading economists have warned, according to a Telegraph report.

The crisis nearly fifty years ago saw a Labour government forced to seek an emergency loan from the International Monetary Fund (IMF) after deficits and inflation spun out of control. It became one of Britain’s worst postwar crises, with the bailout bringing deep spending cuts and Labour losing power a few years later.

Now Chancellor Rachel Reeves faces similar warnings, with forecasts showing a £50 billion ($68 billion) gap in the public finances and debt interest set to exceed £111 billion. Debt now exceeds 96% of GDP. At around £2.7 trillion, it is one of the heaviest burdens in the developed world. Government borrowing costs have surged, with yields on 30-year bonds climbing above 5.5%, higher than those of the US and Greece.

Losing a proxy war is costly. The insanity of Clown World can be seen in how both the British and German governments are pushing for more of the war and more of the sanctions that is bringing them to the breaking point.

For some reason, the servants of the Black Rider never seem to understand that they’ll be discarded once they’re no longer of use to him.

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Opposing AI is Marxian

Since it’s obviously too difficult for the average individual who denigrates the use of AI and opposes its use on the grounds of insufficient human involvement to understand their own position well enough to recognize its obvious intellectual roots, I asked Claude to dumb down my observations enough to permit their little midwit minds to grasp it.


The Hidden Marxism Behind “AI Slop” Complaints

When critics dismiss AI-generated art as “soulless pablum” or “AI slop,” they’re often unknowingly channeling a 19th-century economic theory that most economists abandoned long ago. Their argument, stripped to its core, reflects the labor theory of value that Karl Marx popularized—the idea that something’s worth comes from the human work put into it. This perspective, while emotionally appealing, fundamentally misunderstands how we actually value art and creativity.

The Labor Theory in Disguise

Marx argued that a product’s value stemmed from the “socially necessary labor time” required to produce it. A chair was valuable because a carpenter spent hours crafting it; a coat, because a tailor labored over its seams. Critics of AI art make remarkably similar claims: a painting matters because an artist struggled with brushstrokes for days, a novel has worth because a writer agonized over every sentence, a song touches us because a musician practiced for years to master their instrument.

Notice the pattern? The anti-AI argument insists that art without human toil is worthless—that the struggle itself creates the value. When someone calls AI art “slop,” they’re not really critiquing the output’s quality. They’re saying it lacks value because it lacks human labor input. A beautiful AI-generated landscape might be visually indistinguishable from one painted by hand, but critics dismiss it anyway. Why? Because no one suffered for it.

Where This Theory Falls Apart

Economists largely abandoned the labor theory of value because it couldn’t explain basic market realities. Why does water, essential for life, cost less than diamonds? Why can two painters spend equal time on portraits, yet one sells for millions while the other goes unsold? The answer isn’t labor—it’s what economists call subjective value. Things are worth what people believe they’re worth, based on their preferences, needs, and circumstances.

Art has always been the ultimate refutation of labor-value thinking. Van Gogh died penniless despite pouring his soul into his work; his paintings gained value only when audiences decided they mattered. A child’s finger painting might take minutes but become priceless to a parent. Street artists create elaborate chalk drawings knowing rain will wash them away. If labor determined artistic value, none of this would make sense.

The Real Source of Artistic Value

What actually makes art valuable? The answer varies by person and context. Sometimes we value technical skill—but photography didn’t become worthless when cameras replaced the painstaking work of portrait painters. Sometimes we value emotional resonance—but a simple song can move us more than a technical masterpiece. Sometimes we value novelty, sometimes tradition, sometimes the story behind the work, sometimes pure aesthetic pleasure.

AI art can fulfill any of these value sources. It can create novel combinations no human imagined, generate perfectly crafted compositions, or help disabled individuals express visions they couldn’t physically create themselves. When someone uses AI to illustrate their novel or design their album cover, the value comes from bringing their creative vision to life, not from how many hours they spent learning how to use Photoshop.

The Ignorance in the Argument

The “AI slop” position reflects a peculiar ignorance about how art has always evolved. Every new tool faced similar criticisms. Photographers were told they weren’t real artists because machines did the work. Electronic musicians heard that synthesizers were cheating. Digital artists were dismissed because “the computer does it for you.” Yet each tool simply changed how humans express creativity, not whether the results had value.

More fundamentally, the anti-AI position ignorantly assumes we value art for the artist’s effort rather than our own experience. But people don’t listen to music thinking, “I enjoy this because someone practiced his scales for years.” They don’t admire paintings on the basis of the painter’s hours invested. Art’s value lives in the connection between work and audience, not in the production method.

Moving Beyond Marxian Mysticism

The fear driving “AI slop” rhetoric is understandable—artists worry about their livelihoods, and change is scary. But wrapping economic anxiety in Marxian labor mysticism doesn’t help anyone. It obscures real conversations about attribution, consent, and fair compensation while promoting a backward-looking view that confuses suffering with value.

Art made with AI tools isn’t automatically valuable, but neither is it automatically worthless. Like art made with brushes, cameras, or computers, its value depends on whether it resonates, inspires, or satisfies human needs and desires. Artistic value, like all value, is inherently subjective. That’s how value has always worked, despite what Marx claimed.

The next time someone dismisses AI art as “soulless,” ask them this: are they evaluating the work itself, or are they calculating the human hours that weren’t required to make it? The answer usually reveals that they subscribe to an outdated socialist economic theory from 1867, whether they know it or not.

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Peter Turchin Kept the Receipts

One of my favorite analysts, Peter Turchin, is one of the few people who loves data even more than I do. He quite usefully chose a pair of opposite predictions concerning the Ukraine war back in 2022, one from Paul Krugman and one from Scott Ritter, and constructed models on the bases of those predictions in order to track the way the war unfolded.

Now, I could have told him that Paul Krugman’s model would be wrong, because Paul Krugman is always wrong. But that’s some high-level UHIQ pattern recognition in action; warning: do not try this at home! In the statistical world, one has to at least pretend to take his predictions seriously and give them a fair shake, even though one has a very high level of confidence that they’ll comprehensively fail.

One of the topics that I wrote about in End Times was Ukraine. After I turned the final version of the text to the publisher in late 2022, I continued monitoring the news about the course of the conflict there, because I was curious to see how well my assessment of the Ukrainian state (a plutocracy) and the war there (a proxy conflict between NATO and Russia) would fare as history unfolded. It was, thus, interesting to see that in the early 2023 the views on this conflict, and predictions about its future course, could be so diametrically opposed, depending on who was writing and what ideological background they came from. The tone in the MSM (main-stream media reflecting the official American position) was quite triumphant. But many American analysts, former military and intelligence professionals, held a very different view.

It occurred to me at that time that this difference in predictions is actually amenable to an empirical test. As long-time readers of my blog (now here on Substack, previous posts archived on my web site) know, I view ability to empirically test predictions from rival theories as key in doing Science (with a capital S). Just search my blog archive using the keyword “prediction” and you will see multiple posts on this subject. So I decided to conduct a formal test.

For concreteness sake, I selected two predictions, both based on an explicitly quantitative argument, but coming from opposite ends of the ideological spectrum. One was from Paul Krugman, channeling the official American position. The other was from another American, who is, however, considered as a “rogue actor” and a “Putin’s stooge”, Scott Ritter. You can read the actual quotes from both in the Introduction of the SocArxiv article, in which I “pre-registered” predictions of my model.

I won’t repeat the details here, because you can read them in the series of blogs I published two years ago, followed by the SocArxiv article that put it all together in a systematic manner and provided R scripts that allow others to replicate all my results.

They’re all well worth reading, although by the middle assessment, it’s already perfectly clear which of the two models, which Turchin labels the Economic Power model (Krugman) and the Casualties Rates model (Ritter), works better, although he combined elements of both into what he describes as an Attrition Warfare Model that appears to outperform both. This makes since, because what really matters most is Industrial Capacity and Male Population Demographics, both of which are presumably incorporated in Turchin’s AWM.

And he explains exactly what his AWM suggests at the moment.

As you can see (the dashed red line “We are here”), we’ve already entered the region where Ukrainian army can collapse at any moment, although this “moment,” according to the model can happen at any point between now and February 2027 (corresponding to 60 months after the start of the conflict). As I explained in my posts and the article, the final outcome is not much in doubt, but the rupture point is extremely difficult to predict. The situation is akin to seismology. For example, the recent Kamchatka earthquake of exceptional power was predicted 30 years ago, except nobody could know when it would actually strike. The Attrition Warfare Model is actually more precise than that. From its point of view, it would be a surprising outcome if Ukraine is still fighting beyond February 2027.

Note that I said, “from its [the model’s] point of view.” I emphasize that the future is unknowable in precise terms. In any case, the goal of this article was not to predict the future, but to use the method of scientific prediction to empirically test between two, or more theories.

The Attrition Warfare Model (AWM) encodes both alternative theories, (1) the Economic Power hypothesis, which predicts a win for Ukraine (Krugman) and (2) the Casualties Rates hypothesis, which predicts a win for Russia (Ritter). It is clear that the first theory will be rejected, no matter when the war ends.

Turchin’s work can be a little wonkish for the average individual to follow, but it’s not as complicated as it might look at first. He keeps things simple enough, and his writing style is clear enough, that with just a little concentration, that it’s both insightful and educational for anyone with the intelligence to be paying attention to these small matters of war, revolution, and societal survival.

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Tripling Down on Failure

Western sanctions on Russia have completely failed. Additional sanctions on China have completely failed. So now, instead of accepting their defeat in both economic and proxy war in Ukraine, both the USA and the EU are going to try sanctioning India. This effort too will fail.

On Sunday, a top aide to President Donald Trump accused India of financing Russia’s war in Ukraine by buying oil from Moscow. “What he [Trump] said very clearly is that it is not acceptable for India to continue financing this war by purchasing the oil from Russia,” said Stephen Miller, deputy chief of staff at the White House and one of the US president’s most influential aides. “People will be shocked to learn that India is basically tied with China in purchasing Russian oil. That’s an astonishing fact,” Miller said on Fox News.

This marks a significant hardening of tone, signalling that bipartisan pressure on India’s Russia policy may persist regardless of the administration in power.

The Indian government issued a stern response, saying Delhi would keep purchasing oil from Moscow if it is in line with national interests. Its foreign ministry stated that country’s energy purchases are guided by market dynamics and national interests. “⁠The government is committed to prioritizing the welfare of Indian consumers. Our energy purchases will be based on price, availability and market conditions,” the statement read.

Despite Trump’s claims that India had stopped buying Russian oil after his threats, the Indian government said it is not aware of any pauses in imports. People in the oil and gas industry have confirmed that the government has not issued any officials requests to refiners to stop purchasing Russian oil.

As global energy flows are increasingly weaponized, India’s path is becoming tougher, but also more clearly defined. This is no longer merely a question of compliance with sanctions; it is about resisting the politicization of trade and asserting agency in a fragmented global order. The message to the West at large: India’s energy decisions will not be dictated by external red lines.

The era of quiet compromise is over. In its place, a more assertive India is stepping forward, redefining its energy calculus, managing geopolitical headwinds, and defending its autonomy with both pragmatism and resolve.

It’s really remarkable to observe how prodigiously stupid the flailing actions of a declining empire and the posturing rhetoric of its retarded politicians are. It’s as if they have no ability to grasp the fact that they are in no position to demand the things they are demanding.

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Castalia and the Cost of Tariffs

So President Trump has imposed a 39 percent tariff on Switzerland. This has a direct impact on all the Castalia Library books now being produced in Switzerland, beginning with the Byzantine histories and Dracula. Now, the tariff is imposed on the declared value, not the retail price, so it’s not quite as bad as it looks, but it is a bit of a problem going forward since the discounts provided to subscribers for paying in advance don’t account for this additional expense to the 12 or so books now in production.

Now, even if we jacked up the subscription prices by 40 percent, our books would be a much-better value than Easton Press books, which go for $168. However, we know things are tight, and we don’t want to price our books out of the reach of subscribers who can’t afford a price increase right now.

So what we’re contemplating doing is to add a T-version of our base subscriptions to Library and History, similar to the Euro version of History, that will allow those subscribers who can a) afford the additional tariff cost and b) want to support the bindery. Libraria and Cathedra prices have a sufficient cushion to absorb the additional expense; we priced Cathedra with the expectation that there would be a tariff, although we were hoping for something in the 10-15 percent range. That would mean increasing the monthly subscription price from $50 to $75 for Library.

Another option, indeed, one that we’d originally contemplated from the start, is going back to producing all the US books in the USA, while producing the higher-quality books from the Bindery for Europe and the rest of the world. This would complicate our production runs, but since we could still produce all the interior book blocks from the same tariff-neutral location, would be entirely viable from a manufacturing standpoint. The primary downside is that we would have to establish another shipping operation instead of being able to rely solely on the US one.

Speaking of US production, THE SWISS FAMILY ROBINSON has passed the stamp test and will be getting bound and shipped to the warehouse very soon.

Anyhow, if you’re a Library, History, or Cathedra subscriber, please feel free to share your thoughts on how you think we should address the situation.

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Europe’s Coming Lost Decades

Richard Werner, the author of one of the most important books on banking and economic history ever written, Princes of the Yen, explains why Europe is economically stagnant, and in doing so, inadvertently provides a hint at what might be the real reason Shinzo Abe was assassinated three years ago.

Many observers are puzzled by the dismal economic performance in Europe – which is not getting better, although a new rearmament program may create the illusion of growth. It is argued here that there is a link to the puzzling period of two lost decades of stagnation in Japan, which also created world record national debt for an industrialised country. The analysis goes back to first principles: Only if we understand how economies actually function will we be able to tackle such questions and make reliable forecasts about the future.

Degrowth prescribed for Japan, now exported to Europe

With hindsight we now know that the Japanese recession that began in the early1990s lasted twenty years. In the first decade the recession took most Japan-hands by surprise by its depth and length. Then it came to be used to argue that “structural reform” was necessary for a recovery, although this argument wore thin in the second decade. More and more analysts concluded that my assessment of the early 1990s was correct, namely that the recession had been artificially prolonged by the Japanese central bank.

The great Japanese recession was finally ended in 2013, after Prime Minister Shinzo Abe had won a landslide victory on the unusual election platform of wanting to tackle the too-powerful Bank of Japan – a central bank that had been acting against the interests of the Japanese people for too long. In some speeches Mr Abe was indeed referring to research in my book Princes of the Yen and its policy recommendation to reduce the Bank of Japan’s powers.

Initially, Prime Minister Abe had contemplated a change to the Bank of Japan Law, which had only been changed in 1997 to make the central bank independent and legally de facto barely accountable to anyone. Mr Abe originally joined my recommendation to formally reduce the central bank’s power and independence, and increase its accountability, by revising the Bank of Japan Law again.

This kind of change had earlier been endorsed by a number of (former) fellow LDP politicians and members of the Japanese parliament, including Mr Yoshimi Watanabe, who later became a government minister, Mr Yoichi Masuzoe, who was a member of the Upper House of the Diet, was a government minister later and from 2014 to 2016 was governor of the city of Tokyo, and Mr Kozo Yamamoto, who is a former Ministry of Finance official. They had been readers of Princes of the Yen, which had made a splash in Japan and was widely discussed in the mainstream media in 2001 and 2002. Based on its analysis, they founded the ‘LDP Bank of Japan Law Reform Group’, to which I was formally invited as advisor. Changing the Bank of Japan Law would have been the safest way to permanently derail the reach for ever greater powers that the central planners at the Japanese bank had been working on.

Unfortunately, for some reason, the Prime Minister, who is the grandchild of Nobusuke Kishi, who featured in important chapters of Princes of the Yen, despite his election promises, failed to attempt any change in the Bank of Japan Law.

This is from Werner’s new substack, which I very highly recommend adding to your regular reading. I didn’t realize he even had one until today, when I was reading the transcript of his excellent, two-hour interview by Tucker Carlson, which is the best concise history of money and banking you will find on the Internet.

And while I am tempted to post the entire 30k-word interview here now that it’s been nicely formatted, I’d prefer to see readers here visit Werner’s site; hopefully he will do it himself soon. I have to admit, it’s annoying that when Google has its own AI system, it doesn’t provide an easy, or better yet, automatic means of providing a nice AI-formatted transcript without timestamps on YouTube.

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