Matters Economic

by wjw on November 9, 2018

I haven’t been posting here because I’ve been traveling, and either I was very busy or there wasn’t sufficient internet access, or there was no place to put my laptop so I could write on it.  (Amazing how many bedrooms have no chairs in them.  Or tables.  Or tables that aren’t completely filled with delicate bric-a-brac.)

Eventually I came down with stomach flu, sufficiently awful so that I actually had double vision; so I’ve been recovering from all that, and today’s the first day I’ve felt halfway human, but only halfway.

I came home to my copy of Locus magazine with Russell Letson’s complimentary review of The Accidental War, which I read after the double vision finally went away.   (Your takeaway: “I would not object to Williams following the model of Patrick O’Brian’s twenty-volume Aubrey-Maturin saga or CJ Cherry’s Foreigner series.  This world is capacious enough and its people complex enough to carry on indefinitely.”

Which is not quite true, but still very nice to read.

Letson (and most other reviewers) have noted the resemblance with 2008 of the financial collapse that kicks off the Accidental War in The Accidental War.

When writing TAW I didn’t actually spend a lot of time looking at the 2008 crisis, because I’d already planned my crisis well ahead of time.  Remember that I wrote that first series around the turn of the century, and I’d planned 9-12 volumes in total, and that I had a good idea what was going to happen in each one.  The second series was particularly well developed, because I’d intended sell it next.

So I didn’t have to look at the 2008 collapse, all I had to do was write what was in my original outline.  And remember that I described an economic crisis in The Rift, and had all that in mind, too.

Call me prescient if you like, but the fact is that one economic crisis is much like another,  Prior to the Second World War, they all pretty much ran like this:

1.  Financial skullduggery or irrational optimism produces a bubble or bubbles, which burst.

2.  Investors, motivated by FIG (Fear, Ignorance, and Greed), stampede to pull their money out of the economy, as well as out of their banks, causing widespread economic collapse, or at least distress.

3.  The government, fearing inflation, restricts the money supply, causing a cascade of business and banking failures.

4.  Widows and orphans are thrown in large numbers onto ice floes to starve to death.

5.  After a decade or two of desolation and misery, things sort themselves out.

After 1945, the scenario ran as follows:

1.  Bubbles burst.

2.  Investors panic.

3.  The government hurls fistfuls of money at the problem, which eventually sorts itself out after a few years.

4. Fewer widows and orphans starve on ice floes.

5. The government writes off most of the money it gave to large institutions, and largely ignores its own increasing deficit.

The Shaa conquerors never having heard of John Maynard Keynes, the crisis in The Accidental War is the first type, not the second.  The main damage isn’t caused by the bursting of the bubble, which is just a correction, but by the government deciding to restrict currency flows, which results in some businesses being unable to get the money necessary to continue in operation, and that wave of collapse triggers more currency restrictions, and so on.

It’s amazing to think about it, but this was the standard reaction for financial calamity for hundreds of years.  (Even Tulip Mania, back in the 1630s, was apparently triggered by a change in the government’s regulation of futures contracts, leading to the bubble that, well, did bad things.)

And why was there a financial crisis in the book in the first place?  Well, desperate people do desperate things, some of them violent.  In a crisis they also go looking for scapegoats, and the people actually responsible are going to divert attention from themselves as much as possible.

So, the usual: stupid people do stupid things until the stupidity catches up with them, and the only thing they can think of doing is to kill a whole lot of people.

And thus does history echo down the millennia.

{ 3 comments… read them below or add one }

Etaoin Shrdlu November 9, 2018 at 8:02 am

Fair enough. :-) I didn’t know you’d plotted the Praxis universe that far ahead, much less that long ago. I remember the story of your inspirational Quillifer walk.

I can’t help but think that an interstellar empire tens of thousands of years old would have come up with a better response pattern, though, and that the economic contagion would have been limited by the relatively thin trade links across wormholes compared to the enormity of planetary economies. Even in 2009, some national economies weathered the storm reasonably well because things like currency controls (which mostly harm their economies in normal times) blocked Wall Street from dragging them into the pit. And thanks in large part to 2009, we have the technology to take control of the mint out of the hands of central bankers — just on a mere human timescale, not a millennias-long interstellar empire timescale.

Sympathies about the stomach flu! I hope you’re fully recovered soon. I myself am still trying to recover from the follow-on inflammatory effects from a UTI. One never thinks about how nice it is to pee until one can’t, n’est ce pas?

wjw November 9, 2018 at 4:13 pm

Thanks for your comments!

Of course there are no national borders in the Praxis universe, it’s all one rather huge, if somewhat shambling, economy, limited only by the speed of light at which news of a transaction can reach the farther corners of the empire. And it’s not run by people who know anything about economics, it’s run by people who got their jobs out of heredity, cronyism, trading favors, or brown-nosing, and some of these are criminal insiders who want to divert attention from their own behavior. So what they do in a crisis is one of a series of highly-standardized responses, because then if it goes wrong they can say, “We did what the book said to do! You’re not saying the book is wrong, are you? Because wouldn’t that be, I dunno, treason or something?”

Etaoin Shrdlu November 10, 2018 at 1:31 am

“The book”, LOL! Perfect reply from an author. :-)

And regarding the Peers — point. Game, set, match.

I do hope you develop the Lai-own psychology some more. Avians should have some radically different perspectives. Well, more so if they were able to fly, which I guess Lai-own can’t do any more other than with a vehicle — the kakapos of the Praxis universe, or maybe the dodos if this “make the rival species extinct” thing takes off.

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