I have been doing some thinking on a subject likely very important to the commonwealth, how to make our economy not suck, but I am hitting some walls and am interested in what the rest of you think.
The way I see it, we have two very basic first steps to take, repairing our infrastructure and institutions (this is mostly the stuff that is actually available to us right now in the yearly actions) and spurring on domestic consumption (for now I imagine this will happen passively as we improve on more basic issues but hopefully we will be able to address more directly later).
However, no matter how you slice it, these alone will not be enough, unless we keep rolling nat 100s on our stewardship rolls for the whole game or something. We will need foreign investment or at least exports, and lots of them. But how to get these things? So far most of my ideas have proven unfeasible.
- Sell a lot of natural resources. This runs into the multiple issues of all of our resources either being relatively cheap stuff that most people can get from dozens of other places like lumber, or stuff that has very few remaining uses thanks to a rise in green technology like coal. Plus we probably want to avoid the sorts of issues that often plague states that rely on resource extraction for most of their economy.
- Offer very cheap labor. This is not feasible both because automation has likely kicked this strategy into the dustbin of history, and because quite frankly given the makeup of our government agreeing to do this would be rather out of character imo.
- Find a bunch of foreign backers and use the promise of us becoming a loyal ally in the global cold war to pump them for investment. While this will result in having to tread a fine line between getting investment and just being an outright puppet, as well as the difficulty of convincing countries we can give them enough of a strategic advantage to justify investing in us in the first place, this is the most feasible option as far as I can tell, and we already kind of started doing it with getting the princess to pay for our infrastructure on her dime to help her environmental projects.
- Offer some kind of niche service that others don't care to or don't want to. I have no idea what this might be. Ideas range from being discount bootleg Switzerland or a black market state like Brittany from TNO to saying screw it to global copyright laws and becoming pirate radio station central or something (likely impossible due to the difficulty for us to remain politically neutral as opposed to meeting with disapproval from the biggest superpower on the planet). Would certainly mix well with our free-wheeling anti-hegemony aesthetic at the very least.
- Just pull a 5-year plan and do crash industrialization. This is a no-go as we have neither the resources, nor the political will or desire to engage in this sort of thing despite how enthusiastic some members of the communist faction might be.
If anyone else has any ideas I would love to hear them.
Education, education, education, education, population density and good transport.
Industrialization is mainly a manifestation of a high concentration of human resources. Though cheap energy helps significantly. I suspect that by 2073, when wind, solar and nuclear (and maybe also batteries and fusion) are considerably advanced from what we have today, energy availability is likely to be much more even around the world.
As such, by far the most important thing needed to industrialize for the Commonwealth is to invest in education (and in things that give people the good health and security to thrive in their educations, like equitable and accessible heath care and an economic safety net that supports adult education). Population density is difficult to control (though we could artificially encourage urbanization, I doubt that this would be a good idea in the specific situation the Commonwealth is in, and in any case, settling refugees in Chicago will be raising our population density) and transport infrastructure is partly covered by the lakes and the rivers of the Commonwealth. Rebuilding the rail and canal network (or heck, even properly repairing the road network) will be an expensive long-term project.
So... We need to put as many resources as we can possibly spare into education, it is cheaper and has more bang per buck than road, canal and rail building. And over time smart and motivated Commonwealthers will figure out what industry can thrive in the modern Great Lakes area.
If we steal some pages out of the book of planning and support agencies like the Scottish Development Agency and its successors Scottish Enterprise and Highlands and Islands Enterprise, we could further catalyze that and hopefully keep brain drain from becoming crippling.
Though of course, we will also need to make some investments into expanding energy generation and expanding transport infrastructure.
As far as getting the resources to pay for the above, there's really four ways to go about it:
1) Soviet/East Asian Planned Capitalist style - depress consumption to force saving, use those saved resources to pay for more efficient transport/energy generation/factories - those investments lead to increased efficiency which results in producing more resources per factor input tomorrow and thus rising wealth. This works, but the Soviet example shows the dangers of doing this with a government with weak organizational capabilities and a population that is already in grinding poverty - both of which apply to some degree to the Commonwealth in the 2070s. However, while we should keep in mind the very pertinent experience of the Soviet Union, this sort of approach has worked extremely well in mixed economies with free-ish markets. All of the "Asian Tigers" followed this path to some degree with measures of varying subtlety designed to push the savings rate up, repress consumption and support extremely high investment rates.
2) Debt/export fueled growth - borrow money from some foreign lender to build factories/generators/transport infrastructure, then use some of the products of those factories to export to places who have forms of currency that the banks/investors we borrowed from will accept, pay off the loans and then still have the factories/generators/transport infrastructure those loans were spent to buy. A major factor in the successful industrialization of the US, Japan and other East Asian success stories. This requires favorable circumstances - a stable world economy, friendly lenders, a good that can be produced advantageously locally and which foreigners with "hard currency" want to buy. It can go horribly wrong. See the Communist regimes in Eastern Europe who tried to follow the Japanese example at the wrong moment and produced goods to export to the West at a time when the West couldn't afford to import those goods, plunging the Soviet-dominated regimes of Eastern Europe into a debt-austerity cycle that broke their regimes (for example Poland falling into de facto military dictatorship in the 80s) or the failure of Argentina's attempts to build export-oriented industries. Also, even success can be problematic - see the dependence of the German economy on its export markets in Southern Europe for example.
3) Conquest & colonialism - go loot someone else, invest the resources looted at home. This is a significant part of how Britain paid for its industrial revolution, and the horrors of the Transatlantic slave trade and the abuses of the British sugar islands (which made US cotton plantations look positively humane) are why the Commonwealth probably doesn't want to make this a major source of funds for industrializing - especially since the only places the Commonwealth could realistically colonize are other areas of the former US. Though arguably I am lumping too much together under one heading, since there are 3 distinct subtypes here: this can be straightforward looting (like in medieval India where kingdoms would "box around the compass" every generation or so looting the accumulated wealth stores of their neighbours, spending that wealth on temple construction and regularly getting looted themselves, fueling the golden era of temple construction in that region - this is probably the most positive example here), conquering and taking land (such as the way the US fueled its economy by invading and dispropriating its neighbours), or using forced labour where the excess labour or the excess land is obtained by violence (like the Caribbean sugar islands, the British regime in Egypt, the Spanish regime in colonial Peru and Bolivia).
4) Agricultural revolution. The agricultural revolution is THE big factor that pushed the industrial revolution and it was caused by the Columbian Exchange pushing agricultural productivity up faster than population growth could keep up. I doubt this is something possible for the Commonwealth, since all new technologies for increasing agricultural outputs either require a long time to implement or require very large capital inputs since you are basically building a food factory... But maybe there've been some amazing advances in genetic engineered plants?
I think really, the Commonwealth will need to do all of the first 3 to at least some extent - we'll probably be forced to rely primarily on (1) to get going, with as much of (2) as we can possibly get away with (depends on finding things we can export and finding friendly lenders who won't seek to gut the Commonwealth economy if disaster strikes the world economy) and some of (3) as we loot the wealth stores of Victoria and recycle them into productive economic spending.
Money, unless the Commonwealth is borrowing from abroad, isn't really important. What is important is the trust that undergirds the money system (which is why irresponsible management of currencies can be so damaging) and the productivity of the economy of real people, real goods and real services. That said, the economic advantages of tapping the innovation and resources of the world outside the FUSA are so great that the headaches of dealing with getting "hard" currency (that is, money that people in Moscow, Lagos or Paris will trust) very much worthwhile, so likely we WILL be borrowing from abroad and we WILL have important concerns about the Commonwealth's hard currency reserves and trade balance etc.
fasquardon
forums.sufficientvelocity.com
