Economic Collapse seems to be a popular meme in the media and blogosphere. While there is no market for predictions of economic collapse on the idle Prediction Market, there should be.
Lyndon LaRouche has been talking about the upcoming economic collapse of the United States for a few years. Mike Whitney of the leftist electronic fish-wrapper Counterpunch agrees. Conveniently, Whitney interprets VP Dick Cheney’s conservative investment strategy, entirely congruent with both his age and legal requirements that the VP of the USA not take any active stock positions while serving, as a conspiratorial bet on economic collapse.
While I, like many, am unhappy with the US government policies that have been weakening the dollar for the past number of years, I believe that there is at least an argument in favor of these policies. The argument being that a weaker dollar will make US products more affordable on the world market. Of course, the missing piece to this argument is the requirement that there be sufficient US manufacturing to create the products.
Still, certain elements on the far left were saying the same thing about the US under Bill Clinton 13 years ago. I guess he wasn’t leftist enough for them.
How about Venezuela, land of the new anti-kulak campaigns, and its economic woes? For leftist commentary exorcising a country’s economy from signs of imminent collapse, we only have to look at this apologetic website for Fidel Chavez, I mean Hugo Castro, I mean Hugo Chavez. In 2002, even the formidable, reliably pro-socialist BBC reported that Venezuela’s economy was in a bad way. More recently, Bloomberg reports that the Venezuelan and Ecuadoran economies are the shakiest in South America. Here Bloomberg describes how Venezuela’s central bank is doing everything it can to slow inflation from last year’s 19.5% to 12%, which is low for Venezuela. OK, the US had similarly high interest rates and equally high unemployment back in the stagflation days of Jimmy Carter, but it took Ronald Reagan’s policies of (military) government spending and tax rate decreases to shake the country out of its Carterista malaise. Does anybody see Hurricane Hugo doing something like this in the misty depths of their crystal ball?
Iran isn’t doing well. Thomas P. M. Barnett has a brief article about Iran’s economic troubles. Inflation is running around 12%, and exports are doing well because of oil and petrochemicals, which made up 87% of exports in 2004. Oil-exporting Iran is expected to go into a trade deficit by 2008. OK, so Iran is probably not going to collapse in the next six months. But it’s poised for a popular uprising of some sort.
Gaza, a.k.a. Hamastan, a.k.a. Fatahstan, not only is already in a state of economic and societal self-cannibalization, but the lunatics are running the asylum. It is the first suicide-bomb-state, having a terminal case of the jihads that will cause death by hemorrage. And quick. But we hear nothing about Gaza from the usual suspects, except that it’s all the Jews’ fault.
How about Zimbabwe? A leaked (unsourced) aid group estimate predicts that Zimbabwe’s economy will collapse within six months at the most. Zimbabwe’s current inflation rate stands at 3,714%, with prices doubling every two weeks. Projecting out to the end of 2007 gives an inflation rate of 512,000%. To put that in layman’s language, 5,120 Zimbabwean dollars at the beginning of the year would have the purchasing power that one Zimbabwean dollar had at the end of the year. Imagine convincing your boss that your pay needs to be doubled every two weeks and you will start to understand what this means to the unfortunates trapped inside Marxist-thug Mugabe’s miserable command economy.