Nature of Economy

Question 1

What is one way that nations crumble? (The Wolff decomposition cycle)

Answer 1

1. Accumulation - Private entities allowed to accumulate capital
2. Infection - Private entities (capitalists) use accumulated capital to influence economic policy, allowing themselves to accumulate more capital and depriving the government of much-needed revenues.
3. Inflammation - Infrastructure and public services became degraded and fail to function properly due to lack of funding.
4. Sepsis - Capitalists point to decaying infrastructure as evidence of government incompetence as argument for small government and reduced taxes.
5. Parasitic Invasion - Private companies loan funds or resources to the government to restore infrastructure and public services.
6. Self-Cannibalization -
   Capitalists collect interest payments from governments which encourage personal debt to make up for stagnant wages.
7. Collapse - Debt accrues faster than it can be paid, a debt bubble bursts.