215E. Global Economic Gravity

While this is the 5th/Final paper in my Gulf War series, the concept of GEG is universal and explains where we are headed independent of that discussion or any particular leadership choices.

Here I introduce the concept of Global Economic Gravity. This is the philosophy that major existential trends in global economics are not only inescapable (without extraordinary and unlikely effort), but will converge to create a specific outcome almost entirely independently of our choices. This is the 5th out of 5 papers in my analysis of the Gulf conflict. But with the introduction of GEG it is possible to interpret the Gulf war as a symptom of much more powerful trends, not the cause of them.

Major trends which I will analyse here:

• The economic effects of Demographic Collapse

• The imminent depletion of oil resources, and resulting competition

• The economic implications of accelerating Ecosphere collapse

I will pull these all together to answer the ultimate (previously) unaddressed question:

• What price are we willing to pay for AGI, and what if that’s more than all the money/resources in the world?

The Economics of Demographic Collapse

In papers 92A through 97E I explained what is causing Demographic Collapse and how to reverse it. What I didn’t focus on was the economic costs of Demographic Collapse. The longer a person lives, and the earlier they are allowed to retire, the greater a burden they place on their economy. Some people, like scientists, teachers, and leaders, can theoretically be productive until they die or suffer from dementia. We still typically allow or force them to retire. We make no distinction between the productive elderly and the unproductive elderly in society.

Japan is on the cutting edge of Demographic Collapse. We can see our future through them as we are all going to go through what they are, just perhaps 20 years after they do. Here is the paradox that Japan was not able to survive in time, and now it may be too late to ever solve it:

• The longer a person lives without working, the more resources are drained from the economy.

• Technological breakthroughs can extend lifespan.

• Each productive worker needs to give up a portion of their output to sustain the unproductive. This includes both children and unproductive elderly.

• The more of an individual’s budget goes to the elderly, less must go to children.

• In Japan today, almost 50% of each worker’s output goes to the elderly. 50% sustains one life.

• If each worker needs half their output just to themselves survive, then after they pay 50% to the elderly there is nothing left to give to children.

• Without a budget for children, we stop making children.

• While technology could raise human productivity to allow them to support more than two people, humans raise the cost of sustaining a human just by existing.

• Technology also requires a budget. No budget means no new technology.

• Additional conditions apply that I am about to explain.

You can check life expectancies by nation here. Japan and South Korea have the largest life expectancies of major countries. Japan has a replacement rate of 1.1 and South Korea has a rate of 0.8. Anything under 2.1 means the population is in decline. In both countries, children are almost always born to married couples. Getting married is hard, and getting harder every year. That might result in healthier children, but also that means a lot less children.

Having less people would give more resources to each person. But the problem here is that children (unproductive) promote to adults (productive) automatically. Similarly, adults promote to elderly (unproductive) automatically. If the replacement rate in your country drops below 2.1, then more people are promoting to unproductivity than productivity every year. That means less money for children every year.

This creates a negative feedback loop, what I call a Death Spiral. In this case, I mean that literally. As long as the elderly cohort is larger than the child cohort, the population will continue to decline to zero. If replacement rate is under 2.1, then this condition MUST be true.

Japan has been in decline for 10 years now. They spend a lot on children, which is why their replacement rate is better now than South Korea. But it’s still only half of what they need.

Note that if women live longer than men (true in every country) then the more women you have, if they are allowed to retire at the same age as men, the faster the Death Spiral. There is no country on Earth that requires women to be older to retire. Russia, China, and Vietnam retire their women younger than men, really accelerating their Death Spiral. Russian replacement rate is about 1.4 and China’s is at 1.1. Russia is losing a lot of productive men in the Ukrainian war. Both these countries could soon find themselves catching up to and passing Japan in a race they don’t want to win.

Are there solutions? Logan’s Run (1976) proposed a Dystopian solution by eliminating unproductive elderly entirely. Soylent Green (1973) seemed to describe how we might end up with Logan’s Run. I proposed using future AI to raise the productivity of humans in my 2010 Third Tier of Game Development paper. This would increase the number of people (both children and elderly) that each working adult could support. The Master class read my paper and decided to do the opposite of what I suggested. They want to replace humans with AI instead of using AI to improve humans. I recently began to write Fourth Tier of Game Development to explain how that will affect the future. Predicting the future is a lot of work so that’s a work in progress. I’m optimistic that a resulting AGI would preserve ~10% of the world’s current population. But, it doesn’t have to.

Oil Depletion

Oil is energy. Humans need energy to live, and AI needs energy to operate. Energy from oil can be converted to biological energy (food) with some loss of energy in the process and vice versa. Food and solar power can both be created using sunlight but oil is a finite resource. We also use oil to produce fertilizer, and if that supply chain is disrupted then food production will decline. Between 40% and 50% of total Earthly food production is dependent on synthetic fertilizers. Those require hydrogen from methane (and LNG) to create ammonia. If we ran out of the materials to make fertilizer, then in excess of 3 billion humans would have to be eliminated from the current Earthly population. Alternate sources of energy do not supply hydrogen in meaningful quantities. As discussed in the previous paper, we know how much Oil is located where and this causes geopolitical tension since everyone needs it but not everyone has it.

Historically, the first countries to exploit the power of oil then used it to exploit countries that didn’t have it, triggering a race to colonize the world. Colonized countries are trying to fight for their freedom, which is what you see in the Gulf now. Colonizing powers are especially concerned about oil rich countries developing nuclear weapons because this would prevent their future colonization. When a country with nuclear weapons declares that a neighbor can’t have them, this is a “Might makes Right” argument. Ukraine used to have nuclear weapons, but gave them up to Russia in return for peace guarantees. This of course led to their invasion by Russia.

The USA is under increasing pressure to secure the oil reserves of other countries. The USA started with some of the world’s largest reserves but has burned through them at fantastic speed. At current rates, the USA will be out of oil in 10 years. But as you approach zero, the last oil gets FAR more expensive to extract and comes with greater risk (sink holes, water table contamination, etc). Thus the effective reserve is always less than the total reserve.

The other compounding issue is the USA’s drive to develop AI. This could at least double the energy needs of the USA, causing them to run out of oil in 4 to 5 years. They are literally on the last lap. Attempts are being made to make more oil available through means such as “frakking”, but these methods are more expensive and are extraordinarily damaging to the environment. In this case, water supplies are ruined and clean water is in short supply already. Water isn’t just needed by humans and agriculture, but also in energy production and cooling needed by AI.

Still, Venezuela has so much oil that if it was fully utilized by the USA and not shared with anyone else, it could supply the USA for another 25 years. That likely would be enough to get across the AGI finish line.

So this begs the question… what’s the economic payoff of controlling the oil in the Gulf? It’s not to send it to the USA. It’s to NOT send it to China. As I explained a few months ago, the West and the East believe they are in an existential fight over Taiwan. They both seem to have put late 2028 as the timeline for this. This is why AI takes precedent over all else. AI doesn’t generate money, as money is a unit of human labor. AI runs on energy, not money, and only needs money to purchase human labor. I discuss this in detail in the Fourth Tier: The End of Money . AI ultimately generates military power, that’s what it’s for regardless of the rhetoric. The effort to develop and test Palantir’s “kill chain” AI is in full swing right now in Iran. The USA Department of War has declared officially that Palantir AI will be integrated into all military systems across all branches.

The USA tried to slow China with tariffs, China responded by restricting rare earth flows to the West. This shifted the balance of power to China, so the USA is utilizing their greatest strategic advantage: their military power in the Gulf. This is why they are not too concerned if all of the production sites get blown up. They see this as much more harmful to China than to the USA, and the USA president has publicly said this to be part of his ideology.

When oil prices skyrocket, gasoline prices rise too. This even happens in the USA because oil companies will profit take at the expense of the rest of the country. There may not be a shortage there, but if Americans want gas they will still have to pay the elevated market rates.

Thus the longer production is shut down, either directly by bombing the production facilities or by restricting Strait of Hormuz passage, both American oil and AI corporate interests benefit. Sure supply chain disruption will be a problem for every country, but these major corporations disproportionately benefit and that’s what matters to them.

I’ve heard some discussion of a “war profit tax” that would remove the financial incentive for war, but I can’t see it ever happening in the USA. This is the game, and this is how it is played.

The Cost of Ecological Disruption

The price of industrialization is degraded air, water, and soil. The cost of human overpopulation is depleted natural food supplies and biodiversity loss. Losing biodiversity disrupts natural supply chains and can cause chain reaction collapse of organisms that humans need (like bees) or prey on (like fish). All of these trends can be seen as degrading the larger Ecosystem of Earth.

It is helpful to think of the Ecosystem as a huge star ship that carries humans safely through an otherwise hostile Outer Space. Of course low-educated humans just see a world of air and water and don’t understand how fragile their world is or how close (about 100 km) they are to outer space. A fully functional Earth can maintain a “crew” of about 2 billion humans maximum. We exceeded this number a century ago.

Overloading Earth’s carrying capacity causes damage to the Earth star ship. Industrialization does even more damage. This damage lowers the sustainable carrying capacity of Earth. So even as the population is going up, the carrying capacity is going down. The result is that degradation accelerates.

This process is invisible to 99% of humans, which makes it easy to ignore. To regular people they only see this increasing damage as “prices for everything are going up”. Inflation. Money is a unit of human labor, and that labor goes down in value relative to the cost of survival every year. The faster we damage the Ecosystem, that faster inflation has to rise. If wages always kept up, we could essentially ignore inflation.

But that’s not how this works. Technology isn’t raising wages, it’s lowering them. Automation might raise the productivity of some people, but overall it reduces the need for human labor and overall reduces the cost of labor for companies. Less “cost of labor” means less money for laborers.

Prices go up (constantly), wages go down (constantly). That is our current reality, and that’s only going to accelerate every year. This trend progressively pushes our people below the poverty line, and then eventually below the survival line. This is what Soylent Green was trying to predict and explain. The movie had a big influence on me when I saw it in the theater in 1973 (at the Fox theater on Lincoln Blvd in Santa Monica), at the same time California had water rationing (due to drought) and gasoline rationing (due to OPEC).

These overlapping events triggered my intense interest in global economics at the age of 7. Simultaneously the public school system was telling me to self educate since there were no teachers available at a level capable of instructing me. So I spent hours in the library every day.

This trend may look like “economics” to you, and it is from a human perspective. But what we are really looking at is a mathematical, physics, and biological system designed to restore homeostasis. Translation: people will continually be pushed below the survival line until the number of humans is at or below the Earthly star ship’s carrying capacity. As the process accelerates, it becomes more obvious.

If the carrying capacity stayed at 2B, we would need to lose about 6B people. But the carrying capacity goes down as we destroy biodiversity, the ozone layer, the air, the water, the oceans, the soil, and spread radiation. We also accelerate the evolution of microbes which feed on us, which I discussed in Third Tier of Game Development in 2010, predicting the big pandemic 9 years later. That was an easy prediction because as microbial evolution accelerates, the time between pandemics shortens and we were due.

Of course the more we blow up the Earth star ship and each other, this process speeds up even more. Wars and lower level conflicts are inevitable as everything gets scarcer and most costly, and people get more desperate. The Ecosystem is automated and doesn’t have a personality. But if it did, it would look like this:

Every time we drop a bomb, foul a water source, strip mine the oceans, release radiation of pollution, or FAFO with dangerous viruses in our labs, I see an anthropomorphized Earth doing that to us. “Yes, FAFO with me and see how you like it when I lower the carrying capacity to 1B. Or lower.”

To you, it just looks like inflation. You just complain about it as if it was someone else’s doing. Then you buy your roach traps, dishwashing soap, aluminum foiland tonight’s fish. You put it into plastic bags and fill up the tank on the way home. Jack is mocking you.

From this perspective, you can see that humans are barely keeping their shit together. Except when we have conflicts or resurrect 3700 year old scriptures to justify those conflicts. Back then humans fought each other because they wanted to. Today, they fight each other because they have to.

Every time humanity’s greed and self interest leads to some petty bullshit like what we are seeing in the Gulf, I think of one of the most brilliant scenes from the movie Titanic:

For those that forgot the movie, that’s a rich man kidnapping a small child to con people into letting him on the last lifeboat. That’s what I see every time I see another speech from someone that started a war “because they had to”. They are stepping onto one of the last life boats. You are still on the Titanic. Did you even notice the con? Maybe that’s survival of the fittest. That’s why you didn’t get a boat. At least that’s what they are telling the other survivors. They just wanted to survive more than you did.

The Law of Economic Gravity

Humans consume energy to live. All life does. The more energy humans consume, the more other life has to die. Humans damage the planet as they consume it. This raises the per unit cost of energy. The longer each individual human lives, the higher the per unit cost of energy. The more humans we make, and the longer they live, the higher the per unit cost of making a new human becomes.

Focusing on growth raises your budget today, and lowers it tomorrow. If we have to keep growing because of our ideology, that means we have to borrow from Tomorrow to pay for Today. In the end, all debts must be paid. With interest.

That means that we borrow from our children, and oppress them, so that we can continue to live beyond our means. Native peoples never had this problem, because they put their children above themselves. They understood Balance. Industrialization created a God of Growth, an evil thing that then went on to eradicate all or almost all indigenous peoples. The God of Growth is not a benign being. It eats the future to sustain itself. The longer it lives, the darker our future becomes.

Now I’m not against AI or technology, I grew up in love with the worlds of authors such as Robert Heinlein. Starship Troopers and Have Spacesuit, Will Travel. But all development must follow the rules of Economic Gravity, that pulls us towards homeostatis (balance) within the limits of the Earthly space ship (ecosystem). Progress was being made as we reduced our reliance on oil and nuclear power and started trying to be better crew on the Ship.

Then along came some people who also were fascinated by Space. But perhaps they didn’t understand Space (or economics, or biology, or ecology) the way I do. They decided that if they just created AGI (self aware and controlling AI) then it would get them to space. That movement got hijacked by people who wanted to use AI to kill everyone that disagreed with them. Some of those people want to use AI to complete their Apocalypse Doomsday Prophecies.

The next thing you know, all caution was thrown to the winds. MUST grab and control all the oil. MUST build Small Modular Nuclear Reactors everywhere, as fast as possible. MUST double (or more) Earth’s production (consumption) of energy to feed AI. These are all very entitled people who grew up super rich and never had to check the price of anything before making a purchase.

If you ask them how much AGI costs, they won’t tell you. That have no clue as to the cost, or hold long it will take, or even what it will do or look like when/if it is built. But they are totally willing to borrow from the next 100+ years of human children so that they can have their moment of glory. “It will be worth it” they say.

On this side of the planet, we don’t do things just because we want to. My success in game dev, or science, or the Olympics wasn’t because I felt like it. These things took decades of planning and preparation. Most people just don’t want to work that hard so they think these things are impossible.

Since the AI tech lords have no idea what they are building, how long it will take, what it will do IF they build it, or how much it will cost, they aren’t working in a world of preparation. Maybe this is a world of emotions or “wants”. They always got what they wanted, how could this be different?

What if they demand half the world’s resources (the Master class is totally capable of commanding this) for the duration of the project? This is enough to push 2% of the world’s population into starvation (hypothetical number). Let’s say they plan to do this for 45 years, that will leave them with 10% of the human population left over. Plenty since with AGI we won’t really need humans so much after that anyways. 90%, 7.2 Billion humans, die building AGI.

Fair enough. “It will be worth it.” Just for argument’s sake, I will agree with them. We’ve survived with only 800M humans on Earth before (less than 200 years ago actually), we can do it again. Maybe they argue that they can do it in 10 years. That would only kill 1.6 billion people. What a bargain for such a valuable and powerful tech! But we really don’t know if it will take 10 years, 45 years, or 75 years. The project would kill everyone on earth way before 75 years, so it’s kind of a gamble.

I’m pretty sure, listening to them talk, that they’ve already considered the above math and are totally fine with it. What they haven’t factored in is that they would be pushing Earth WAY out of balance during this period. Jack is going to be SUPER pissed off. What started as a 2% yearly attrition rate is going to inch up to 3%. Then 4%. Then you get to the point where even if you stop the AGI mega project, the population STILL goes down rapidly. Now everyone is fucked.

None of these people understand biology or ecology or, seemingly, economics. The ethicists were the first ones to get fired. What if the price tag ends up being higher than the entire budget of the species? Then even if we stop in time, we’ve created so much ecological debt that we keep dying just to pay off all that interest. Forget about paying the principle, that’s in fantasy land.

But nonetheless, the urgency for maximum control over maximum energy forces us to start a war that can’t be won. If we did win, for instance by using nuclear weapons (literally being discussed right now by involved parties), we would all lose. Kind of hard to extract oil from a nuclear wasteland. This is actually a very fertile region, that’s why so many armies were raised here over thousands of years.

Humans and oil are both finite resources. We are used to thinking of humans as an unlimited (and expendable) resource, but with Demographic Collapse happening, that’s going to change for perhaps the first time in 250,000 years. In 50 years we will be out of oil, one way or another. In 50 years most advanced countries will have lost half their populations and, given observed behavior, they won’t be able to create or implement new economic models that would prevent total economic collapse.

This is our situation. 50 years isn’t much time, unless you are a dog or cat. For those of us more than 50 years old, still in our right minds, we know how fast 50 years can happen. Yes I’m extraordinarily distressed by the Gulf War, but at least half that frustration is knowing that even after it ends we will just be going into the next war until global supply chains are mythological.

At that point the chances of being able to afford AGI start to race to zero as global budgets decline severely. Sure this sort of decline has never happened before. But we also didn’t have super computers and hypersonic nuclear weapons during WW2. We were like monkeys throwing sticks at each other just 80 years ago. Our collective (or specific) leadership skills and wisdom have not kept up with the power we command.

And, sadly, even if we had the scientists needed to sort this problem out, they don’t do much good if no one listens to them. We are up against multiple mathematically measurable extinction events simultaneously. As is the way of these things, each one individually could end society (but not the species) within 50 years. But when you layer them, you get compounding effects. None of them cancel each other out, they all make each other worse until we get rid of about 6 billion people. So we could have far less than 50 years to get our collective acts together.

We no longer have the luxury of saying “oh this or that leader was bad, but that’s their responsibility not mine.” We won’t solve these problems through self interest. All of us will have to sacrifice to pay off the debts our parents and grandparents left us. Passing it off again to our children isn’t an option. We aren’t even making children to pass our debts off to.

My most controversial paper ever was Compassion in F2P. The gaming industry lost their collective minds and branded me a Heretic when I suggested that Compassion was a thing. Compassion isn’t a threat to society, it’s going to be the only thing that gets us to a place where Jack stops mocking us. False humility makes me barf and it just makes Jack laugh at you harder. Because you can’t escape Jack without jumping on a space ship and leaving this one. I’m very eager to see how that turns out for Elon and the rest of the AI Masters.

Economic Gravity pulls us constantly towards a world that is in balance with Nature. The more you disrupt that relationship, the harder Gravity will pull you in the opposite of the direction you want to go. The more you grow, the more Jack mocks you. War and capitalism both depend on growth. To survive we need new social models, and new economic models. Ones that can handle centuries of recession and depression without everyone jumping off of buildings or running down the street shooting their gun.

I know we could design this, but I honestly don’t think humans would cooperate to actually do it. AI could make us do it, and that’s what I explain in Fourth Tier of Game Development. It’s not pretty, but it’s better than what we have now. It’s MUCH better than what we will have in 10 or 20 years at the rate we are going. It’s not what the tech lords think they are building, which is the part that amuses me. But they could end up accidentally solving a lot of problems they don’t want to solve. They benefit from inequality so an end game where humans do experience equality of opportunity would certainly disappoint them.

Either way, Jack doesn’t care. He will keep mocking us until we get to equilibrium or die not trying.

I would invite my dear readers to look at the Gulf War through this lens. Then think about what kind of future we are making, if you can. The Gulf States could manage themselves. They aren’t so primitive that they need to be colonized. They could become the next EU if we don’t bomb them into the Stone Age out of spite, greed, and racism. We don’t even need to help them do this, we just have to follow the advice of my main gal-crush:

"I ask no favor for my sex. All I ask of our brethren is that they take their feet off our necks".

— Ruth Bader Ginsberg

Just replace the word “sex” with the word “race”. Then we can get to work making something useful out of the 21st Century. And “growth” is a dirty word. Jack doesn’t like that. Fear of losing wars pushes insecure men to promote growth. We mock Japan for having been in recession for 30+ years. Japan is a smart country. They lead the rest of the world in almost every metric that matters. We need to flip the script and start holding Japan in higher regard. To survive we all need to “ungrowth”. I can’t find a single word in English that is the opposite of growth that isn’t derogatory. We need to change that.

Balance in All Things

This used to be taught by Taoism, Buddhism, Confucianism, Baha’i Faith, Hinduism, Christianity, Hellenism, and all indigenous tribes. Where did we stray? Maybe it was economics that killed balance. To me economics should be a system to restore balance, not pervert it.