GLOBAL RESOURCES ANALYSIS


EFFECTS | SMALLER GOVERNMENTS


By the global wealth redistribution caused by the resources 'taxation by free markets' the economies of the former wealth nations will shrink. Extended and always growing governments (keep on growing is a characteristic of government) can only be feed/funded in growing economies. Shrinking open society based economies have no mercy for over stretchiness of governmental layers. Governments of shrinking economies have two options: adjusting to the economic levels of their economies or totalitarian and/or fascism. Governments are both a blessing as a curse for economies. Wise governments knows to find the small right line between those two and bring maximal (possible) prosperity to nations, by steering all developments in the best direction. As said: governments are the steering factor of economies, human capital, financial capital, agricultural production, advanced services, tourism, technology, trade and resources to motors. Governments that don't steer, over steer (over regulating) or trying to become also the motor, severely damages their economies. When local economies became more imported by the enhanced local solution, local governments will gain more influence. Economies under pressure will (by less governmental income) have severe smaller national or federal governments. Governments will fade away from the economy as motor, by the decline of their financial power. Governmental income is based on 1) taxation (less economy, less taxation) and 2) funding (less good economies, less funding budget shortages). When 'societal unrest' by the effects of economic decline even become 'societal turbulence' being government than is not easy. Maintaining free open societies driven by democratic governments will be the challenge of the governments of the declining economies. Dire straits ask for gifted political leaders. Totalitarian or fascistic 'leadership' are the dangers of those times. This is the reason why the need of transition has a political aspect: no transition is economic chaos and thereby human suffering and will give too weak governments or just the opposite too strong fascistic and/or totalitarian governments.


Author: Gijs Graafland


Back to Effects Index


Download the full Global Resources Analysis report in PDF