[ExI] War drives innovation

[Dennis May]

Tara Maya wrote:


> However, the paradox is that for the past five hundred years (probably more) 
> wars have always been won by the combatant with the strongest economy, 
> and usually that has meant the freest economy. Liberal England vs centralized 
> Napoleonic France, the capitalist democratic Allies vs. the National Socialists, 
> etc. The technological and financial inventions that made the more liberal 
> governments stronger did NOT come from the government, but in time of war, 
> WERE put to good use by the government. 

John Grigg wrote:

> And so what does this say about the rivalry between the United States and 
> Communist China?  They will fairly soon have the bigger economy, and is 
> ours really the most free?  We do have the technological edge, but that is 
> steadily eroding due to the massive Chinese espionage program aimed against 
> us, their demand that all foreign companies working in their nation divulge 
> all manufacturing tech secrets, and also because of the major resources China 
> is spending to modernize their military and nation in general.

It is a real question whether the United States has the economic freedom 
to successfully compete with China.  Chinese central planning prevents
innovation but they are very good at reverse engineering.  They are sitting
on a powder keg of internal problems and bad internal investment.  On the
other hand they have their fingers in resources around the world, control
of trade routes, and everyone owes them money.  I suspect the economic
problems in the US and Europe could destabilize China if it gets much 
worse - then everyone in the world has a bad day - even the central planners
who caused the problem thinking they had the knowledge necessary for
economic planning.

Dennis May
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