Entry 3 – War (second phase)

We are waiting for the Chinese communist party congress to end, and for its new leaders to make future decisions regarding the war and the new world order.

Decisions will take them a few days after the end of the congress. Moreover, even if they make them, this does not imply that they will be made public immediately, nor that we will know about them.

It is time to wait. Fingers crossed.

In the meantime, I want to focus this new entry on recounting what I interpret as small signs of the positions of the parties, as well as describing trends that go even beyond the results of the war. In other words, I am writing this entry as a transitional entry until the decisive information reaches us.

As for what I have called “small signs”, I summarize them in my usual and particular press summary:

The Western radical left is very divided. I already quoted in previous entries Paul Mason’s views in favor of waging Hard War against Putin.

What is new (for me) is the petition of signatures in Change.org that another part of the western left has made (you can see it here). It is very significant that it has been signed by Chomsky, who is a reference for our Pablo Iglesias. By the way, as a curiosity, although Chomsky was born in the USA, his parents were Jewish immigrants from Ukraine (he must have more than some direct information from there, and more than one feeling involved).

The fact is that, in this petition, from the beginning of October, something similar to a peace pact is proposed. They are not only talking about Ukraine, but also about Taiwan. They are saying that it is better to renounce something than to enter into a world war. The truth is that the text is very well written. It is very similar to what I suggested at the end of my recent entry 2.

It turns out that, in this, the radical left is very close to the proposals of the radical right in the West (Trump, Musk, Meloni, …). It is the classic that “extremes touch.” However, the moderate right and moderate left of the West are still betting on Total War. We shall see, …

Other parts of the Western left are quite at odds with that proposition, as can be seen here.

On October 22, 2022, a photograph has been in the news.

There is no public explanation. It is just the photo. It looks like what I commented before about kremlinology, i.e., let everyone draw their own conclusions.

The fact is that Hu Jintao (the former leader of China) has been “expelled”, “helped out”, from the Chinese Communist Party Congress. And, Xi Jinping, sitting just to his right, has ignored his claims of conversation.

With the secrecy that characterizes them, it will take a long time to know the truth of what happened, but it looks like the first phase of a radical change of power in China. Something like a “warning to navigators”. And, it should be remembered that Hu Jintao was known to be more moderate than Xi Jinping.

Following the Congress of the Chinese Communist Party, on October 23 the members of the Standing Committee, which is its highest body, were appointed. The result is that there is no trace left of different “currents” within the party. They are all of the highest loyalty to Xi. Moreover, they are relatively young for what is customary in these organizations, so it may be a long-lived structure, perhaps designed for an equally long project.

Xi Jinping now has absolute control of the party and the country for five years. It is more than likely that he will want to use that time to gain control of much of the world as well.

Xi Jinping gave a speech. It is worth mentioning the phrase: “China cannot develop without the world, and the world also needs China“.

From now on, they will start to act. We will have to be very attentive. It will be the beginning of very different times.

Since this summer, there has been a lot of talk about the BRICS (Brazil, Russia, India, China, and South Africa) countries creating their own currency. It has been in the news very little, but they are talking about it seriously.

In addition, it seems that Saudi Arabia wants to join, which would mean that oil could be changed as a reference currency (this helps to understand why the West is trying to hide the news).

If true, it is much more important than it may seem.

Some information can be seen here and here. Again, the picture is very significant. It should be remembered that these countries, without further partners, account for more than 40 percent of the world’s population and GDP.

Also, in terms of currencies, I liked the summary here of the evolution of the digital yuan (the Chinese state cryptocurrency).

It is still undergoing tests, but they are already tests with very serious figures. They have moved 13.9 billion USD; 360 million transactions; 5.6 million businesses accept it, … It seems to me that nobody can stop this anymore.

Meanwhile, in the West there is also an evolution of cryptocurrencies. It is an evolution of a different range, but not negligible. We are talking about the agreements between Google and Coinbase. The case is that Google is going to accept payments in cryptocurrencies based on its agreement with the Coinbase exchange. It can be seen here.

This is yet another small attack on the strength of the dollar.

There is no need to comment much on it, as it is very public, but it is important to remember that the government crisis in the UK, and the formation of the new one in Italy, weaken the West quite a lot.

On the other hand, Germany has decided to pay for gas increases for households (see here). The measure is logical and charitable, but it does little to lower inflation. If households do not cut their consumption, because there is no economic damage, they will continue to consume. Inflation will continue to rise and the costs will be paid by the state, i.e. more public debt in a country that cannot bear it. It does not look good.

Likewise, it should be remembered that the movements of Russian natural gas are not as we are told. Sanctions do not weaken them. They have collected even more than before. They have sold more than before to some European countries. And they have future outlets with their “friendly countries”. It can be seen here, and the source is an American university.

As for the trends, which will affect the evolution of things even after the War, I comment as follows.

The dictatorship of the algorithm.

I recognize that what I am about to tell you may seem a bit strange and futuristic, but I ask readers to look at it carefully, because I think it is one of the great trends that affect us, and that belong to the root causes of all the instability in which we find ourselves.

I begin to tell it with the example of the game of chess.

We all know that chess is a game of strategy, very intellectual, where there are so many possibilities at the beginning of a game that no “human” player can analyze them all. The good players are those who have the capacity to analyze the greatest number of possible moves in each move, as well as those who have the greatest intuition about what they cannot analyze.

We will also all remember (even if we have to Google the exact dates) that it was very famous the moment (1997) when a computer, called Deep Blue, beat Kasparov, who was one of the best players in the world and Karpov’s eternal rival (by the way, now they are also at war, with Karpov in favor of Putin and Kasparov against him, as you can see here).

The fact is that a machine beat the best human in an intellectual game.

That was no coincidence, nor discredit. Machines (which are human developments, let’s not forget) are designed so that they can do much more calculations and much faster than us. When there was enough evolution of computers, Deep Blue turned out to be able to analyze more moves than Kasparov.

That was the point of no return. Since then, machines are able to analyze more and more plays, and humans are not.

In fact, it is much more recent (September) the case of the player Hans Niemann against Magnus Carlsen. The former is accused of having cheated by wearing a device in a certain hole of his body through which he received warnings from a friend who was playing the same game against a machine (news here).

I say all this to emphasize that machines have already become capable of making better decisions than humans in intellectual tasks.

If we take this example to politics, or to economics, we know that both are taken with scarce data and with the (limited) human capacity to analyze alternatives to those data.

What is likely is that we are already very close (if we have not reached that point) to the time when the machine can be fed with all available data and make better decisions than the best president of the government, or the best CEO.

When we reach that moment, it will be meaningless for us to choose our politician by a vote of electors, with even less criteria (in democracies), or by the decision of oligarchies (in dictatorships). It will be a fact that the machine will do it better.

It is the same in business. Adam Smith’s concept of the “invisible hand” will disappear. The evolution of markets will be the result, as always, of the consideration of many alternatives in the face of uncertain data. And the machine will make better forecasts.

This will be done by the machine, based on the amount of data fed to it, its data processing capacity, as well as artificial intelligence techniques, and, of course, based on the algorithms with which it has been programmed.

And here I come to the point I wanted to make. Like it or not, political and business decisions are going to be made by machines, not humans. Sooner rather than later. In today’s democratic countries, and in today’s dictatorial ones.

What we humans can decide is the priority of algorithms with which we program the machine, which is no small thing.

As an example: in chess we tell the machine that the priority is to eat the king (chess is republican). If, in the world order, we tell the machine that the top priority is to protect the environment, one possibility is that the machine decides to exterminate human beings.

The above is an exaggerated example, but it helps us to focus the ideas. We would have to give the machine a set of priorities (defined with weight percentages) regarding the environment, the quality of human life, inequalities, the opening of the “social elevator”, … And that is up to us. After that, the intellectual work of humans would be relegated to the reprogamation of the machine, … and to art.

Of course, at that point the doubts about which political and business system is the right one (free market, or central planning, …), which are the causes of the Wars in which we find ourselves, will be over. So, even if we don’t like it, the sooner we get there, the better it will be.

I make the mention that this is not just my craziness. There are more crazies. In fact, in Denmark there is already a party, the Synthetic Party of Denmark, that proposes a machine as candidate (although they use a human figurehead as official candidate, because the other is not allowed). You can see the news here.

I also make the point that replacing governments with machines may be a bit far-fetched for now, but delicate tasks are being replaced by machines every day. For example, airplanes go most of the time on autopilot, and cars are on the verge of being autonomous.

In the end, decisions are going to be made by algorithms. This is what I call the dictatorship of the algorithm. That’s why it’s very important to review the instructions we give the algorithm. They are not easy, by the way. Let’s think of a car that is about to run over a person because, for example, it has run out of brakes. Does the machine choose whether the pedestrian or the driver dies, does it do so on the basis of the age of both (which it knows), or on the basis of the medical probability of survival (which it also knows how to calculate), or on the basis of what the world loses with the absence of each one (it also knows their jobs and capabilities), or on the basis of what the world loses with the absence of each one (it also knows their jobs and capabilities)?

Relationship state – religion – money.

It got me thinking about something I recently heard from a good friend of mine (Adrian, who writes, among other sites, at adrianbernabeu.com).

Adrian is in love with Bitcoin and has a very interesting historical evolution analogy.

He says that, when the old Regime ended (after the French Revolution), the State-Religion unity was broken. From that moment on, government decisions became “influenced, but not dominated” by all the tendencies of each place and time, including religious ones. This is true and something we have all studied since school.

That was one of the relevant events in creating what have become the Western democracies. And a lot of progress was made, although today these countries are in a weak situation.

It is clear that this progress was not the same in countries that did not make this separation of state and religion, such as Muslim countries.

Well, Adrian argues that now it is time to do something similar to that, separating the state from the currencies. He believes that allowing the state to control currencies is giving it excessive power. And he thinks that Bitcoin could fill the gap as a universal currency, not manipulable by people or governments, as well as being easily tradable, divisible, secure, traceable…

Not that this is Adrian’s invention. Many people have been saying it for a long time. What has made some click in my head is the analogy.

Considering all the battles going on now with inflation, the power of the dollar, the evolution of the digital yuan, the currency of oil payments, … the suggestion is interesting to say the least.

I think something similar will happen at some point. But I also think it may still be a little early for that.

This is as far as I have gone for today in this entry that I have called transitory. In subsequent entries I will discuss what has happened in the meantime, as well as the situation in Europe, which is very weakened by energy and the dollar. Also how the dollar’s strength may only be transitory.