Guideposts: Populists Shouldn't Be Pessimists | | by George Gilder and Richard Vigilante
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DISCLOSURE: This is a paid advertisement for RAD Intel's Reg A offering. Please read the offering circular and related risks at https://invest.radintel.ai | | | "Realism" is often used as a synonym for "pessimism."
Foreign policy realists are credited with facing up to "grim realities." In economics, one gets to be a realist by saying we must choose between a roaring economy and inflation, except the realists don't say "roaring" they say "overheated."
Pessimism is not realistic. It is the most dangerous of delusions. It makes war and poverty and leads to tyranny.
In America, pessimism triumphs when our leaders lose faith in liberty, not only as a source of happiness or justice, but as a source of power. Liberty is the greatest strategy for world domination ever devised and yet we are forever turning our backs on it.
For most of our lives, right and left have been divided along optimist and pessimist lines, with the left being overwhelmingly the pessimist party.
That might seem odd given that liberals were so optimistic about so many improbable things, from the ease of relieving poverty by giving people money, to improving neighborhoods by replacing tenements with projects. More recently, they have been fantastically pessimistic about supposed threats to the earth, but absurdly optimistic about fanciful solutions such as giant, self-destructing windmills.
Perennially, they have been optimistic about the malleability of human nature, so long as they get to do the malleating. Just give us the mallets and we will do the job.
This apparent and facile optimism swiftly collapses on contact with reality, becomes pessimism and then necessarily tyranny. None of those optimistic dreams are allowed to come about by the natural inclinations of free men. Free markets would never give us windmills, or solar panels spread across the fields and farms of America. Free markets would not spend untold billions turning slums into murder zones or families into fragments. All require the use of force.
Pessimism devolves to tyranny because the pessimist, after some initial frustrations, comes to believe it is up to him to make things happen. All the master murderers of the 20th century were massive pessimists sure that the future depended on them.
Before the revolution, Russia was the fastest-growing and fastest-industrializing economy in Europe. Stalin murdered millions because he believed Russia would make no progress unless he forced it to. Mao topped the all-time murder charts because he believed the only way he could urbanize China was to starve the countryside. Hitler believed the Aryans, left to their own devices, would always lose out to the Jews unless he killed them.
The political tragedy of our time is not that silly Democrats became sillier Progressives. As we may be seeing now, that turned out to be a largely self-healing problem. All we had to do was say "boo!" and Gavin Newsome begins warning against transexual surgeries.
The real political tragedy is that via the populist movement, so many American conservatives have become pessimists and increasingly turn their backs on liberty. | | Have You Seen This $11 Trillion "Tech Strip?" While many folks today are wondering what to do with their money…a revolutionary "sheet" of new technology has quietly sparked an $11 trillion tech revolution.
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Click here to see how anyone can profit fast. | | | Pessimist populists need a bogeyman. Conservative populists mostly find theirs in China. China sucks away their confidence and persuades us that liberty is not the winning strategy. Fear of China is behind almost every stupid impulse of the MAGA movement, from tariffs and trade wars to the bizarre and dangerous idea, beloved by the new Republican demagogues, that we are "already at war with China."
Their notion that China is a threat to American power, whether military or economic, is as contrary to fact as the most risible progressive propositions.
And it is dangerous. It is but one step from believing we cannot compete with China to trying to cripple that nation by fair means or foul. Keep it up and millions will die.
And besides, it is complete nonsense, so much so that the most dangerous thing we can do is take the threat seriously.
American politicians, journalists, and other professional worry warts, for instance, seem in awe of China's economic growth (the awe being one reason they do not understand its source). They point with alarm to Chinese gross domestic product (GDP) growth and fret that within a few years it will progress from being the second-largest economy in the world and overtake us as first.
That's quite true and quite meaningless as a measure of national power. As Michael Beckley explains in his brilliant book "Unrivaled," what matters when measuring national power are not gross resources but net. To compare the value of, for instance, national GDP, one must count the costs of producing it:
"gross indicators … such as … (GDP) and military spending… tally countries' resources without deducting the costs countries pay to police, protect, and provide services for their people. As a result, standard indicators exaggerate the wealth and military power of poor, populous countries like China and India. These countries produce vast output and field large armies, but they also bear massive welfare and security burdens that drain their resources."
What matters to national power is what a nation has left over after covering basic costs of feeding, housing, and policing its people. A nation with a billion people and per capita income of $1,000 cannot compete militarily or otherwise with a nation of 100 million people and a per capita income of $10, 000, even though both total to $1 trillion. After paying for the necessities of life, what's left for the $1,000 per capita country to buy arms or train an army?
He reminds us of the enormous "net advantage" we have for "with only 5% of the world's population, the United States accounts for 25% of global wealth, 35% of world innovation, and 40%of global military spending. . . And it is the only country that can fight major wars beyond its home region and strike targets anywhere on earth within an hour, with 587 bases scattered across 42 countries and a navy and air force stronger than that of the next 10 nations combined." | | Historic Shifts in the Markets: Are You Ready? History shows that generational wealth is built in moments of massive change. Like Trump's early presidency that reshaped markets in days, we're entering another transformative period.
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The Chinese military can ill afford foreign adventures because their government is not secure at home. "[H]omeland security operations consume at least 35% of China's military budget and bog down half of China's active-duty force." China must keep most of its military on guard at home, "because it suffers from twice the level of domestic unrest as the United States" and because it "shares sea or land borders with 19 countries, five of which fought wars against China within the last century" and many of which have "the means to deny China sea and air control throughout most of its near seas—even without U.S. assistance."
Of the world's 15 most valuable companies, 13 are American and the other two are Saudi Aramco and Taiwan Semiconductor (NYSE: TSM). China does not show up until number 16.
The top 100 U.S. companies are worth $36 trillion. The top 100 Chinese companies are worth $5 trillion.
China is the world's number two in venture capital investment. What an amazing accomplishment for a nation still relatively poor. Yet the U.S. still leads in venture investment by at least three-fold and by some measures more.
China's main asset today is the U.S. policy of forcing them to develop their own microchip supply chain. Since the U.S. Chip Act, China has been massively improving its self-sufficiency, while the United States has been stagnating.
Under Chairman Xi, a Maoist allegedly determined to bring socialism back to China, national return on invested capital has shrunk to low single digits largely because of massively renewed subsidies to state-owned enterprises. American companies that used capital so inefficiently would be summarily executed by American investors. Waste threatens to make Xi's country poor again despite its technological vitality.
China has generated a widely distributed entrepreneurial economy. Chinese capitalism, not Xi's guidance, explains Chinese innovation. Just as here at home, China's best hope is that its government cannot fully suppress its people's amazing energy
We should not want the Chairman to succeed in socialism. We want China to be rich and innovative and challenge us in technology and science so we can trade with the Chinese and share in their wealth and learn from them as much as they have learned from us.
We must adopt liberty as a strategy for power, prosperity, and peace.
Sincerely,
George Gilder, Richard Vigilante, Steve Waite, John Schroeter, and Robert Castellano
Editors, Gilder's Guideposts, Technology Report, Technology Report Pro, Moonshots, and Private Reserve | | About George Gilder:
 George Gilder is the most knowledgeable man in America when it comes to the future of technology and its impact on our lives. He’s an established investor, bestselling author, and economist with an uncanny ability to foresee how new breakthroughs will play out, years in advance. George and his team are the editors of Gilder Technology Report, Gilder Technology Report Pro, Moonshots and Private Reserve. | | | | | |
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