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this post was submitted on 16 Apr 2024
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Building things and then blowing them up increases your GDP but it provides negative benefit to your society. All of that labor is wasted just for products that are destroyed and cause destruction.
And wage growth will be very robust if you force 1 million of your best workers to flee the country and then kill or cripple 300,000 more workers on top, and then create tons of jobs to build stuff that gets blown up instead of things people can actually use for something productive.
Neither of these metrics tell the real story for a wartime economy. Subsidizing useless production that gets blown up has to take largely from state coffers, robbing from essential services for the population.
And if you lose your revenue streams like oil because your refineries and pipelines keep getting blown up and you lose customers to sanctions, and you take workers from useful sustainable jobs with real benefit and move them to building things you blow up instead, eventually you will have to choose between any services for the population and funding the war.
You don't get tax revenue from state spending that you blow up. Take it far enough and you'll just run out of money for the war and will have to enter hyperinflation to keep printing the money to fund it.
These trends are under way in Russia, they spend 40% of their national budget on war already. They lost 20% of their refining capacity in the last couple months alone. It will take a while to reach a full disaster, but they can't continue this way indefinitely. They will hit the wall at some point in the next decade.
A lot of unseen costs of this war will take decades to be seen.
Reduced education spending? Less qualified workers to create added value.
Reduced social services? More people getting sick and dying.
Reduced infrastructure spending? Increased prices of transport and goods.
Yes. Enshittification on a national scale.
Sorry, I can't hear you over the sound of numbers going up.
I'm curious to see if/how much those effects will be diminished by the war effort sabotage by the right will dampen the impact over the coming years
It's having a big impact right now. If they keep it going for another year, Ukraine will be in serious trouble.
The question is not whether Russia will hit a wall, the question remains whether there will be a Ukraine before that happens. Russia just like big corporations is too big to fail.
It all depends on NATO. NATO countries have 20 times the GDP of russia and 5 times the population. If NATO stays in, Russia will lose. If they don't, Ukraine will lose.