Liberal Macroeconomic Theory
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On star-date 15.7.3971 Churangar Hungwangadit laughed to herself. Everything was going exactly as planned. Soon the People’s Democratic Socialist Republic of the Red Planet (PDSRRP) would be the dominant star system in the galaxy. It had been all too easy. The capitalist’s greed had blinded them. Their fear of the United Socialist Sorkovolovishikan Republic (USSR) had driven them to a risky play, one which would forever alter human history.

The capitalists of the United Nations of the New Worlds (UNNW) had just struck a free trade deal with the PDSRRP, hoping that economic incentives would lead them to a new alliance, stripping power and resources and influence from the USSR. Churangar, a leading PDSRRP intelligence strategist, had been the one to suggest to the party leaders that sending signals to the UNNW suggesting such an alliance was possible would be advantageous to them. Too long had they lived the third power, a laughingstock lagging behind the might of the UNNW and USSR.

With this new free trade, they will bring both enemy worlds to their knees. They will shun the USSR, and its economy will crumble to ruins. Then, they will make their masses of unofficially slave laborers available to the capitalist machine, slowly monopolizing the galactic labor market within their planet. The workers of the UNNW will have no footing to compete on, environmental regulations and the fruits of the worker’s rights movements of the past will make them completely vulnerable to off-worlding. Within a few decades, they will function only as consumers and highly skilled laborers, and as the competition for employment as skilled labor stiffens, so too will the price of training.

Social welfare programs in the UNNW will prop up its working class. The opportunity the capitalists parade as evidence of their system’s superiority will evaporate, and in its place will be universal basic income.

But the capitalist worlds will have trade deficits. Wealth will be leaving their country. Most investment will be headed to the PDSRRP, where labor is cheap, because any talk of striking or acquiring more rights as laborers is met with plasma cannons or hangman’s knots. Companies will be based in the UNNW only in name. Their real work will all be done in the PDSRRP. The social programs with which the capitalists prop up their masses, and finance their arms race, will be paid for with loans. Who will make those loans? The PDSRRP, readily.

Then the real genius of the plan kicks in. See, the biggest Achilles heel of capitalism has always been rent. In capitalism, the cost of goods is based on the intersection of supply and demand. Demand is determined by the wealth of the population. Supply is determined by the cost of labor and rarity of ingredients. In this age of interstellar travel, nothing is rare. At least not any material of any use. Mechanized industrial chemistry and mining have come a long way. The cost of labor is dependent on the cost of rent. The cost of rent is dependent on the supply of housing. And the PDSRRP was going to take the returns from its loans to the UNNW and spend them buying up all the land in the UNNW. There were only so many habitable worlds. The influx of “foreign capital”, they would call it, would drive the capitalist rent and property values ever higher.

And as the cost of housing exploded, so would the cost of the capitalist’s labor. That would then the speed the investment and labor flow away from the UNNW to the PDSRRP and their cheap labor. The Ruling Capitalists of the UNNW would become absurdly wealthy from this process, and in turn their greed and worship of their investment portfolios will blind them to what is happening. The masses would take the funds loaned to their government and spend it to buy goods from the capitalists who rented laborers from the PDSRRP. Everyone wins. The people of the UNNW get cheap consumer goods. The capitalists get bigger stock portfolios, and the PDSRRP gets to be the dominant industrial power in the galaxy, and have ownership of the very lands the capitalists believe to possess.

The fools will fatten themselves for the slaughter. She thought to herself, knowing that though she would never officially be commended, her plan would bring the human species closer to the party’s dream of One Race, One Society, One People.

And that slaughter will simply be a refusal to further loan them money. When that happens, the UNNW’s economy will implode, and with any luck, their worlds will turn to civil war.

And the PDSSRP will simply arm and fund one side, and then the switch to the other, altering their aid whenever one gains the upper hand in the bloody interstellar war, ensuring a balance of power in the region and maintaining a violent stability.

 

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