Brazil fact of the day

Considering the limited infrastructure routes, high rate of wear and tear, and the need for various input materials, per-mile Brazilian infrastructure costs are typically quadruple those of a flat, arable, temperate territory — with additional premium for the roads that must pierce the Escarpment.

That is from Peter Zeihan’s quite interesting Disunited Nations: The Scramble for Power in a Disunited World.  The Escarpment, by the way, refers to the cliffs that run along Brazil’s coastal zones and have kept Brazil so long from integrating their cities and building a truly stable nation-state.  The lack of navigable rivers throughout most of the country does not help either — North America was blessed in this regard.

Here is Zeihan’s take on Rio:

…its decline will be emblematic of several of the country’s coastal cities.  It’s too far from the Northern Hemisphere to be involved in manufacturing supply chains, too isolated to serve as entrepot or processing center, and too densely populated to be safe.

Zeihan likes to solve for the equilibrium.

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Genuine question: can someone politely explain what Tyler means when he says "..solve for the equilibrium"?

Is it an economist's way of saying "...and that's why things are as they are?"

You are supposed to feel smug when agreeing with whatever it is TC is presenting.

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solve for the equilibrium = I have no clue where it will end up, but those things will somehow influence the end result

I generally think of it as "given what we know so far, how will this play out?"

This is it. Use economic logic to come up with the most likely outcome.

Ignore the framing that leads to the answer that Tyler wants his readers to have.

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"I generally think of it as "given what we know so far, how will this play out?""

As Hoosier says it's about the likely outcome. Too often people are biased and base their response on what they would like to happen or sometime what they fear will happen. The correct approach is what will likely happen. However, the most likely response sometimes gets the least attention. We should spend more time looking at it and less at the unlikely and extreme outcomes

That really depends on the significance of the unlikely or extreme outcomes. Probability * magnitude.

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My understanding is it's a solution that does not change with time so long as variables do not change...sounds contradictory to me...it's a catchy phrase though

The time rate of change of the dynamical system equals zero, which means no change. For linear systems it's not too difficult to find analytical solutions, non-linear systems not much.

The real world is mostly non-linear.

At the equalibrium point the derivatives are zero, so there is no change in the system at those points. It is stable.

I can't imagine how one can construct a realistic dynamical system to predict the future states of an economy, but it sounds cool.

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I've complained to Tyler about the catchphrase before.

I think that Tyler generally means "think about what will happen next" when he says "solve for the equilibrium." It's not the greatest way to say "think about what will happen next," one reason being that an equilibrium pertains to a referent model, and models are innumerable. When one speaks of an equilibrium one implies that there is a definitized model ("the model") to refer to.

Another objection to the catchphrase is that it connotes a fixity and a terminality that are usually inappropriate. The idea that our understanding is a matter of embracing a model of any of the sorts we associate with the word "equlibrium" is a bad one.

Another reason: Even if it were apt to presuppose a definitized, referent model, the expression seems to also presuppose that there is only one equilibrium in the model (as well as a tendency toward it). But many models have multiple equilibria.

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Last year while visiting Madrid, my grandson laughed at a museum's doorman that repeatedly told him "Esto es lo que hay" --my translation: "This is how we work"-- because we were denied access to the museum's store directly, without going into the long line of people waiting to visit the museum exhibitions. It was at the end of a two-week visit to Spain in which we had heard the expression several times.

When my grandson laughed, I remembered Tyler's expression because I laugh every time he writes it. My understanding is that Tyler likes too much to close some posts like Walter Cronkite's "And that the way it is". It will be his footprint. Regarding the meaning of the catchphrase, most likely Tyler thinks in terms of the simplest solution to the D&S model (the price we observe is the solution at that moment) or any game-theory model (the arrangement we observe is the solution at that moment). I hope, however, that he agrees with you and me that "The idea that our understanding is a matter of embracing a model of any of the sorts we associate with the word "equilibrium" is a bad one."

BTW, we should compare it with Scott Sumner's catchphrase "Never reason from a price change" (see https://economics21.org/html/whats-price-less-you-think-1331.html). Yes, we should not draw inferences by repeating twice Tyler's catchphrase --say, one price in the morning, and another in the afternoon. To understand what happened during a particular day we need much more information and knowledge than connecting the two solutions from applying twice the D&S model.

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Jason, the stereotypical ending to a problem in an economics textbook is "solve for the equilibrium".

Yes, exactly. This isn't a hard concept unlike "straussian" which I didn't get no matter how hard I try.

I have never understood the implication of the American use of "truly", as in "a truly stable nation-state".

A comparably stable state means within a grouping - a truly stable state means independent of grouping.

Basically, truly could stand in for 'objectively.'

It's pretty obvious and not uniquely American.

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Jason: You ask a "genuine question" for someone to "politely explain" what Tyler means by "solve for the equation". I will attempt to do so.

When I was in 3rd or 4th year of my undergraduate degree in economics (a bloody long time ago) the supply and demand lines that we learned in 1st year economics were converted to algebraic formulae. The 2 equations for supply and demand formed a simultaneous equation which, given a set of parameters, we were asked to "solve for the equilibrium" price and quantity. (In graduate school we used set theory for this. It was at this point that I decided to rejoin the land of the living and get a job.)

So it is econospeak. But for me (perhaps sadly) it is a phrase that retains a deep meaning beyond the (long since forgotten) mathematics. To me the phrase evokes the existence of 2 powerful but contradictory forces which are in the process of finding some sort of balance. This "equilibrium" may end up at a place that is "surprising".

Of course, as used by Tyler (and read by econheads like me), the phrase is clearly sarcastic and arrogant. The proponents of political and social movements generally believe that they are heading for victory, and not some sort of rough and ready compromise. The phrase suggests that these proponents are wrong, and even wrongheaded.

Still, the phrase has value I think because it invites us to think calmly and logically about political and social forces that we are caught up in, and even threatened by. It reminds us that there are always countervailing forces; that there will be pushback and even pushback to that. To be sure, we might not like the equilibrium point that we end up at. And there is a real risk of some sort of "collapse". But generally we find a point a point in the middle that most of us can live with.

Cheers, Brad

Sometimes, Brad, you don't get an equilibrium; you might get a limit cycle, say, or even chaos.

I hope my remark doesn't cause you to have nightmares about graduate school.

Or asymptotes ...

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Brad F, I think it is more likely that Tyler is referring to Nash equilibrium from game theory, in which each actor chooses their best strategy given all the other actors have chosen their best strategies. In other words, what he is saying is that given what we know, how will people act? And more importantly how will those people act once they have worked out how others will act. It forces you to think about people as rational actors making decisions when faced with incentives.

Interesting that Nash theory idea.

As for rational actors, hasn't that been debunked by Kahneman and Tversky? We are predictably irrational.

The debunking has also been debunked. People (on average) are impressively rational when they need and want to be and circumstances permit them to be. Run a scholar.google.com/ncr search for Gerd Gigerenzer. He has written extensively on this topic.

Thank you. Will do.

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Whether the equilibrium is Nash or S&D, the fundamental idea is the same: this is the final outcome, and there is no incentive to change unless there is some interference.

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meanwhile
the newwoketimes.con and the democrats are"signaling" that they would not object to riots against federal police & federal property
solve for the equilibrium

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Which is the manufacturing city of Brazil, not Rio. A wiki overview.

São Paulo is a municipality in the Southeast Region of Brazil. The metropolis is an alpha global city (as listed by the GaWC) and the most populous city in Brazil, the Americas, the Western Hemisphere and the Southern Hemisphere.

The city is the capital of the surrounding state of São Paulo, the most populous and wealthiest state in Brazil. It exerts strong international influences in commerce, finance, arts and entertainment.

Having the largest economy by GDP in Latin America and the Southern Hemisphere, the city is home to the São Paulo Stock Exchange. Paulista Avenue is the economic core of São Paulo. The city has the 11th largest GDP in the world, representing alone 10.7% of all Brazilian GDP and 36% of the production of goods and services in the state of São Paulo, being home to 63% of established multinationals in Brazil, and has been responsible for 28% of the national scientific production in 2005.

Rio has glitz and oil and the fading advantage of formerly being the capital city, São Paulo has everything else.

Paulista detected.

What is a Paulista, at least in terms of Strauss? A devoted follower of St. Paul?

Though Strauss would have likely known that São Paulo has been a much more economically significant city than Rio, that being true for several generations.

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From the same chapter Tyler quotes:
"Sao Paulo will be the first among not-even-remotely equals. Its position atop the Escarpment grants it cheap, easy physical expansion opportunities the coastal cities lack; it's size grants it the economies of scale all other Brazilian cities lack, and itcommands the best physical access from the interior to the coast. In a devolved Brazilian system, it is most certainly the regional power broker."

Although it seems from Tyler's excerpt that Zeihan thinks Brazil's future is in decline, and he does think that, Zeihan thinks most countries will be worse off over the next few decades. The chapter on Brazil actually ends on a mildly positive note. He thinks the future in Brazil going to suck, but at least it won't suck anywhere near as bad as other countries.

Apologies for no accent over the a, I forget how to do these things on an english keyboard.
Apologies

The point about the Escarpment is valid, however, Sao Paulo is fairly close to the coast, especially in an age of railroads. It is also how coffee was exported before the city industrialized.

We could quibble endlessly about whether Sao Paulo is a coastal city, but this port is very close by - "The Port of Santos (in Portuguese: Porto de Santos) is located in the city of Santos, state of São Paulo, Brazil. As of 2006, it is the busiest container port in Latin America." Whether Santos/São Paulo is the Brazilian equivalent of Bremen/Bremenhaven (a city/port combination a similar distance from the sea) or not depends on how you look at the fact that Bremen is more or less at sea level with a flowing river connecting the two.

This also seems to weaken the distinction concerning 'coastal,' since the reason Santos is such a major port is due to São Paulo.

And you get most accents and a few odd symbols. Pretty much everything but a euro sign.

São Paulo.

Thanks

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São Paulo sucks. It is damn ugly.

No, it is not. I have spent a few days in São Paulo City last year and it is a very beautiful place, among the most beautiful places in the whole world.

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It is quite dangerous. My in-laws have horror stories you wouldn't believe.

SP is quite nice and exceptionally safe, in addition to having abundant greenery, reasonable prices, icey cold beer, and friendly people. I spent a pleasant one month there and was never molested or raped. I can't say the same about most American cities, and college campi where close to 100% of all students are raped, or will be raped, or would be raped if they weren't so repulsive. It saddens me to say this but I must tell the truth.

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I generally like Zeihan but some of this doesn't make any sense. Rio is too densely populated to be safe? How about Tokyo, which is very safe? Paris? Seoul?

The crime problem in Rio is caused by criminals, who operate because of ineffective policing.

With shipping costs at an all-time low and communication costs at zero, it doesn't matter as much where a city is located as whether the human and physical and financial capital are there to produce something useful. Australia and New Zealand are far from everything and very rich. Bangladesh is conveniently located but poor. Solve for the equilibrium.

Much of the better-populated part of east coast of Australia - most of the part running from northern New South Wales to eastern Victoria - has a steep escarpment: it particularly hems in Sydney. Further north, the Queensland coast faces a reef that made coastal shipping dangerous.

Physical geography is relevant, but I'd thought the days of explaining, say, the rise of Britain as a trading power by comparison of London's ice-free docks to those of the Netherlands had rather passed.

Yes, I was going to make this point also. Additionally, South Africa has an escarpment that separates coastal cities like Cape Town, Port Elizabeth and Durban from inland cities like Johannesburg and Bloemfontein. (https://en.wikipedia.org/wiki/Great_Escarpment,_Southern_Africa)

Is the reference to South Africa an example of a country that developed despite having an escarpment or a country that is declining with (or because of) one?

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RJ's policing is not ineffective. It is very effective and supported by the People, excluding the criminals. And that is despite the unfavorable urban topography. Visit a typical RJ favela for yourself (if you have the balls) and then testify how much better you would do it from your Ivory Tower perch in the USA. The same can be said about SP and all other beautiful cities in Brazil, the country of friendly people, unlimited opportunities, and racial harmony. I won't lie. There is some economic inequality. We will solve for that equilibrium in due course, setting as usual a bright shining example for our benighted North American Big Brother.

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@Pyrmonter - initial conditions dude. Network effects. Krugman's work in this area. Why poverty persists in the Potosi mines of Bolivia 500 years after they saw were opened and the miners impoverished.

@Tyler Ransom - Australia will never amount to anything either, for the same reasons as Brazil, except the lawless point.

Bonus trivia: Brazil's east coast shares the same defects of high cliffs running into the sea as Africa's west coast, since in the pre-Jurassic they were joined. But this Weigner theory of plate tectonics was not accepted as scientific fact until the 1960s. Hence Al Gore's elementary teacher chided him for pointing out the coasts match up. Science moves slowly sometimes.

Wegener, I think. His notion was "Continental Drift" not plate tectonics, which only provided the mechanism. Al Gore is a politician so I'd assume his story a lie.

My geography teacher was a keen proponent of Continental Drift; she probably did her degree before the Second German War.

Plate tectonics was more than a mechanism. It explained continental drift but with a different account of the nature of crustal plates---most continental drift theories assumed continents floating on the underlying surface, while plate tectonics theory was that the entire earth, continents and sea floor, were crustal plates that moved in conjunction with each other. In fact, the defining moment of the theory was W. Jason Morgan realizing that the fractures being discovered around the world on the sea floor spun around common points with no distinction between continents and sea floor.

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I heard somewhere Krugman's thing was trajectories matter. I would add, if he didn't, and I am ignorant of his work, that initial conditions matter.

Brazil was conquered by the Portuguese, who were particularly nasty. Slaves, but not white European wives, were brought to Brazil because the natives were not hardy enough to handle sugar cane labor. Brazil imported about 2,000,000 slaves while North America imported approximately 500,000, one fourth the number as Brazil.

Now fast forward 500 years from those initial conditions and you have a massive underclass served by a terrible k-12 ( without the k) public education system
The small, but supposedly growing, it is always supposedly growing, middle class, like my wife and in-laws, all send their kids to private class. Illiteracy is very high in Brazil. I have known many black people who are functionally illiterate. They can barely write a note. I have seen notes full of words without vowels. It is sad

Another initial condition is the language - Portuguese. Not French, German, Spanish, or English - all languages once dominant at various points in history. The huge undereducated black people mostly work as maids, taxi drivers, laborers, and other unskilled labor. Things are not cheap there ether! Many of these people make around $100 USD per month. It's hard to live on that so they crowd into substandard housing. They are basically trapped.

Brazil does not have the human capital to join the global information economy. Too much money is made selling commodities grown on modern mechanized farms, which has pushed poor, black, illiterate people into the cities. I suppose the "good" news is that there aren't very many people left in the countryside to flood into the cities. Last time I looked ~90% of Brazil's population already live in the large cities. Selling commodities to China doesn't much help the poor people who used to live in the farming areas who are now living in favelas.

Manufacturing:

Any Brazilian will tell you that anything that was manufactured in Brazil is of sh*try quality and overpriced. The Brazilian middle class, tiny but always growing such as it is, lives to travel to New York and Miami and load up gargantuan suitcases to haul everything from TVs to BBQs back to Brazil. Everyone my in-laws visit we have to do the obligatory shopping trips. They buy everything.

Brazilian manufactured goods were sh*try because the industries are (were) protected and so didn't need to improve to compete. Foreign goods were either non-existent or so expensive that buying them was out of the question! Better to fly to New York and shop till you drop!

Then Brasil made some kind of deal with China. I used to take ferry boats across beautiful open water to islands. During my last trip the same trip was a viewless bumper car slalom through Chinese container and smaller cargo ships! Brazil opened their markets to Chinese manufactured goods while China bought all those commodities grown on modern factory farms, plantations, and ranches. Now the poor people can't work on the farm or in the factory. They have massive unemployment and
terrible crime. The implemented a UBI called "Bolsa Minima". I used to buy musical instruments made in Brazil. During my last trip I couldn't find any made in Brazil! Imagine turning a cuica upside down and seeing a "Made in China" sticker!!! No thanks!

So, now Brazil has mechanized commodity production, minimal manufacturing, a terrible public education system, and massive illiterate underclass that speaks Portuguese. Some percentage of the young male underclass makes life exceptionally dangerous for everyone else. Good luck with that!

One of the arguments for reparations is the initial conditions and trajectory of blacks in America, and consider the Brazil imported four times as many slaves whose progeny were ground through an inhumane system inherited from the brutal Portuguese colonizers. Those poor people have suffered. American blacks are priveledged by comparison!

So, Krugman was right, trajectories matter.

Brazil doesn't have the human capital to compete in the global economy, which will only make things worse.

The rest of Latin America has also been handicapped by their Spanish colonizers, who were almost as bad as the Portuguese.

If you are going to be colonized, it is best to be colonized by Great Britain.

The USA, Canada, Australia, New Zealand, and India all look pretty good by comparison.

Everything you said is true. But Brazil is the country of the future with unlimited potential and opportunity, and impressive levels of racial harmony albeit with some temporary economic inequality. Come, visit, spend dollars, euros, or yen, invest, enjoy. You will never want to leave! O Brasil is, as the esteemed North American blogger, Professor Tyler Cowen might say, "self-recommending."

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Location still matters but I see that Australia and Brazil are number one and two respectively for iron ore production. I heard an Aussie economist claim that Australia's iron ore and other natural resources helped bootstrap its development. If true, Brazil's physical isolation should not be an issue if it has resources that are needed by the rest of the world. Once you have the logistics in place to mine, transport and export raw materials, you can put that same infrastructure to work in exporting manufactured exports.

Brazil isn't that far from the rest of the World. The shipping to North America and Europe isn't prohibitive. Indeed, it's probably cheaper than shipping from Asia. So, I don't think location explains that much.

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He is talking about 'favelas'.

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"North America was blessed in this regard."

Only if you consider North America to be limited to the continent east of the Rockies.

It was railroads that made the US.

China invested far more than the US on waterways over a span of a thousand years to create China, but to a powerhouse, China had to invest as much as the US on rail over a century in just 20-25 years, but starting almost a century after the US stopped, China has much better railroads. Plus much better waterways than the US.

Brazil could unite with rail like China has, but that would require paying so much to so many workers, Brazil's income inequality reduction would disrupt society like building infrastructure in the US did multiple times.

Yes, the vast majority of Americans live east of the Rockies, and this was even more the case during the period when America was becoming a world power. North America east of the Rockies is extremely blessed geographically, with a large flat fertile center few others places in the world have (the US has about three times the arable land of China despite the two countries being similar in overall size), plenty of fresh water, and large amounts of important and accessible industrial resources such as iron, coal, and oil. In terms of navigability, North America is also unique in that it has a major North-South River as well as East-West River. There are no major rivers running north to south in China, which historically made it difficult to unite the north and south of the country and required building the Grand Canal.

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"It was railroads that made the US."

+1

How fortunate that the Founding Fathers invented them.

The Founding Fathers presided over a small, religious and largely agrarian country. Railroads transformed the US into the continental sized nation state it is today.

Railroads built by Chinese laborers. Eventually the US rewarded the Chinese with the Chinese Exclusion Act.

The Irish were the real victims. The Chinamen had a country to return. The Irish man's ancestral homeland was under brutal occupation by snaggle-toothed Anglos.

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Most of the interior of Brazil is swamp and jungle and not suitable for railroads, in addition to which there is the upfront costs. Roads are cheaper, flight is cheaper. Most of the action is along the coast. Little motivation to connect all parts of the empire. Most of Brazil consists of snakes and spiders.

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Electric flight. While often pooh-poohed, and some of the pooh does stick, its low cost does mean it could see a lot of use in places like Brazil that are lacking in other forms of transport infrastructure. It will probably even see a lot of use in places where transport is okay.

While I know that I shouldn't throw pooh... I can't resist.

Electricity brings nothing positive to flight. The problem with small aircraft is not the power plant. We seem to be able to handle high speed moving parts and flammable liquids quite handily. The problem is the pilots. To get a pilots license you're talking 10k and a year in training. To get a real commercial fly anything anywhere license it's like 70k and two or three years. Ain't nobody got time for that $**T. So while "flying cars" have been available for purchase since the 70's for early adopter type prices and 0-0 landing systems have also existed since then it just hasn't happened. It won't till it's legal for them to fly themselves. Fix the law the hardware already exists and is cheaper then even the best theoretical battery based systems.

TLDR why electric flight why? Is there any reason that isn't "cause it's sexy". I can not think of a worse application for batteries then a weight constrained endeavor like flight.

Electric batteries have bad power to weight, but electric motors have very good power to weight.

This (potentially) allows the use of more powerful motors for takeoff, allowing narrowing wings and better cruising efficiency. Hybrids may be a real win.

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Electric planes are a niche product at best. Possibly you could make significantly cheaper electric planes, but as you stated, that's not what prevents people from flying.

Heating a house entirely by resistance electric heat is seldom done. Why? Because it's much more expensive per BTU than fuel oil, gas, coal or even wood. Yet everyone is gaga about electric cars. How is that different, expense-wise, when comparing petroleum-powered transport to its electrical alternative? After all, the power that goes into an auto battery comes off of the electrical grid, just like electrical resistance heat.

You make a good point about the power in electric car batteries coming from the grid. The analogy to heating breaks down, however, because not all forms of energy are equal: some of it can be made to do work and some of it is lost as heat. Electricity is essentially 100% available to be put to work. That's why it's so inefficient as a model of heating. Too many alternatives.

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"Heating a house entirely by resistance electric heat is seldom done. Why?"

Because it's much cheaper to use a Heat Pump, just like my house uses. My house is entirely heated by electricity.

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"How is that different, expense-wise, when comparing petroleum-powered transport to its electrical alternative? "

A gallon of gas contains 33.7 kWh.

The Tesla Model 3 uses 26 kWh/100 miles. That's the equivalent of 130 Miles per gallon.

Batteries are on a steady decline in price per kWH and have been for decades. internal combustion engines have pretty much peaked in their efficiencies. The trends are clear. Battery power is already more efficient than petroleum. Soon it will be the cheapest option.

When it's both more efficient and cheaper, the consumer vehicle market will rapidly electrify. People vote with their wallets.

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An, it's the cost of fuel and the huge cost of engine maintenance and replacement where electric flight has an advantage. (Very expensive here in Australia, maybe less in Brazil.) So, provided it is cheaper, I suspect it will be used where there is a niche suitable for it such as over distances in South America that are short as the crow flies but very long otherwise. I presume pilots will be used less often in the future. One of the early niche uses is by illegal drug business people, so legality may not be that large of an issue at first.

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On the other hand, the Escarpment means that some of the moderate elevation inland cities of the Southern Brazil have an extraordinarily mild climate. Curitiba at 3,000 feet elevation has an average high in January of 80 F and in July of 68 F.

https://en.wikipedia.org/wiki/Curitiba#Climate

Sadly, the safety and order of Curitiba has been dwindling in recent years as the city's economic success attracted more and more criminals and undesirables from the north. A friend whose German wife is a director of SAP SE in the US informed me her extended family living near Curitiba and their European neighbors began experiencing home burglaries and car hijackings of such a frequency in 2016 that they threw in the towel after two generations and emigrated back to Germany.

Well, Bolsy must be good for something. Crime rates are very responsive to policy; they fell through the floor in NYC when Giuliani and Bloomberg were mayor, now they're skyrocketing again. Maybe he can fix it.

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Such is the fate of an economy that relies on commodity exports: economic booms when commodity prices are up, busts when they are down. It's the fate of so many developing countries. One has to ask: is it a blessing or a curse to be rich in natural resources? My observation is that being rich in natural resources is a blessing, it's the easy money that is the curse. And that applies whether the easy money is derived from commodities in a developing country or from financial assets in a developed country. I might point out that the Fed has been remarkably successful in maintaining (financial) asset prices during economic downturns, and Americans are mad as Hell about it. What? Why else appoint Judy Shelton to the Fed? Solve for the equilibrium.

The world economic system forces Brazil it to stay a commodity exporting country. Brazil can't borrow money and have large deficits like the USA and Japan can. When Brazil borrows money they pay much higher interest rates. Without running large deficits they can't invest to turn the country from commodity to services and Brazil stays stuck. Also many European and other first world countries add high regulations for aluminum extraction and smelting so large polluting industries like aluminum production get shifted to countries like Brazil. Brazil gets stuck with polluting industries and many aluminum toxic by products held by dams were broken and red sludge killed many Brazilians. But Brazil will keep making aluminum because that is all it has. If they could borrow and invest as much as the first world countries can maybe they could leave these toxic industries behind. The problem is the whole world economic system where you do not have much choices, you do what you are able to, and for Brazil is iron ore, aluminum, soy beans, oranges, etc.

When you buy a Tesla and you are patting yourself on the back for saving the environment, you should know that Tesla does not use recycled aluminum as it is not as high quality. Their aluminum comes from places like Brazil, where toxic aluminum by product red sludge dams break and it killed many Brazilians. Maybe you hate Bolsonaro for all that he represents but by buying a Tesla you are helping Brazil and the extraction and toxic production of aluminum in Brazil.

Not true at all. Brazilian exports help to feed, house, clothe and school Brazilian children.

How better well off would those children be if they could live like Europeans and not have red aluminum sludge flowing through their neighborhoods?

Somewhat better iff. However, under President Captain Bolsonaro's correct leadership, Brazil is reforming and diversifying its economy. Trying to deprive Brazilian children from food is far from being virtuous.

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The US exports 3 million tonnes of aluminium a year, so I doubt they are making Tesla vehicles with Brazilian aluminium.

+1 for that post

Furthermore, making Teslas with non-recycled aluminum is a rounding error. Electric cars are more efficient than gasoline powered automobiles and that efficiency will overwhelm any particular single material. In the long run, electric cars will be much cheaper and will dominate the consumer vehicle market.

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If you are a brazilian you know this is bs. Brazil is backwards for the same reason Argentina is backwards and Chile is much less. That is, labor regulations, corrupt governments and most of all, leftist ideologies. Brazil never fully industrialized because of Vargas, and ever since, has lived as a country that simply cannot compete with equivalent foreign powers. Just look at South Korea, China or even India. To blame this on a "rigged system" is to believe that this same system doesn't apply to all these once poor countries.

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"
The world economic system forces Brazil it to stay a commodity exporting country. Brazil can't borrow money and have large deficits like the USA and Japan can. "

That's a bogus complaint. Japan and most of Asia have increased their manufacturing output even during times of high interest rates. Their success had to do with lost cost and well motivated labor combined with continuous improvements to their products and processes. And probably a pinch of trade barriers to protect their industries when they were smaller and less efficient.

A high savings rate by women at a negative real interest rate was a common feature of now industrialized Asian nations. Brazil's saving's rate tends to be a little higher than that of developed and older average age countries at around 10%+ but pales next to China's rate of around 45% in a normal year.

Australia instituted forced savings to "fix" our low savings rate. It was incompetently and wastefully implemented, but at least it stopped some of the whinging about it.

"A high savings rate by women at a negative real interest rate was a common feature of now industrialized Asian nations. "

+1, that's a good point. A culture difference that could have a profound effect when measured across a society.

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Natural resources are definitely a blessing. There is a pretty noticeable correlation between natural resource wealth and overall GDP per capita: https://www.economist.com/graphic-detail/2020/07/18/the-worlds-wealth-is-looking-increasingly-unnatural. Many countries squander their natural resource wealth, of course, but abundant natural resources such as coal in the UK and oil in the US also are a big part of the reason why those countries led industrialization.

Yes, the resource curse is either spurious or else needs to be qualified as something that applies to countries that are conflict-prone or that started out with poor levels of governance. Norway with its oil and Botswana with its diamonds seem to be doing just fine.

If Botswana is an example of a country that is doing fine with natural resources, isn't Brazil as well. Ive never been to either but most metrics favor Brazil.

Botswana beats Brazil in GDP per capita terms.

Moreover, you have to compare countries to their neighbors. Botswana boasts a high growth rate and HDI and GDP per capita figures that are firmly in the upper middle income range and among the highest in mainland sub-Saharan Africa. This is not what one would expect from the "blood diamond" hype.

True, and certainly a neighborhood success, but its median income seems to be around half of Brazil's. These two metrics together also imply some of the issues associated with resource curses applying to Botswana.

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Here is Philip Greenspun's take:

https://philip.greenspun.com/blog/2007/05/10/botswanans-the-republicans-of-africa/

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My comment about "easy money" from commodity exports wasn't an insult to Brazil, just as my reference "easy money" from rising stock prices wasn't an insult to the US. What I am referring to is the failure to invest the "easy money" in productive capital, the need to convert the "easy money" into long-term investment to enhance the over-all economy, the failure the result of the belief that the "easy money" will always flow. It won't, not in Brazil and not in the US. Human nature assumes tomorrow will be just like today. Good luck with that.

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Brazilians prefer to spend on welfare and pensions rather than infrastructure and growth.

Just because they are not spending in bail-out in biological/nuclear warfare, it does not mean they do notbspend in infastructure and growth.

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Brazil's domestic product per capita was 8% that of the United States in 1918 and 25% that of the United States in 2016. It increased 10-fold in real terms in that time. They've had some growth in the intervening years.

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This is beyond ridiculous. Rio de Janeiro City is exactly where it is to benefit from a first-rate newrowrk of seaports, the inexhaustible resources of Brazil's hinterland and cutting-edge techniques from Brazilian scientific institutions. It was the Portuguese capital city in the Americas, later it as the heart of the Empire of Brazil and now it is, in many ways, the center of the Federative Repub,ic of Brazil, one of the biggest economies the world has ever seen.

It's ninth, which like many other things about Brazil (the beauty of its land and people excepted), is "pretty good."

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Would Peter Zeihan be a bad guest for Conversations with Tyler?
That's my lame attempt at reverse psychology.
If that is a conversation Tyler wanted to have, and not the one I want him to have, what questions would he ask?

Tyler would not ask Zeihan how many of his bold predictions on the imminent collapse of China turned out to be false. Maybe he would talk about the what he likes to call the "Peter Zeihan production function" instead. In other words, softballs.

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The book follows the narrative arc of Jared Diamonds "Blood, Germs, and Steel", about the future, but without the germs and without acknowledging the human capital required to service an advanced technological societies. Zeihan's defensible geography has little relevance to the 'Space Forces' being planned in advanced economies. His sloppy 'too densely populated to be safe' and long supply chains description of Rio indicates a faulty and shallow thinking about the world. My family and our friends have felt quite comfortable walking the the streets of Shanghai and Beijing at night.

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" It’s too far from the Northern Hemisphere to be involved in manufacturing supply chains"

That much further than China?

Or Australia?

Is China involved in American supply chains? Or does China have its own supply chains that start with raw materials and go all the way to the finished products within China?

Both

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" Or does China have its own supply chains that start with raw materials and go all the way to the finished products within China?"

My point being that Australia in the Southern hemisphere is a prosperous raw material exporter. It has no problem exporting it's raw materials to China and other destinations. So, it doesn't seem that Brazil's location in the Southern hemisphere would prevent it from exporting raw materials to the US and other destinations in the Northern hemisphere.

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Too far from supply chains is mostly nonsense as supply chains don't care because transport is cheap for anything that doesn't spoil quickly. And a lot of trade is in ones and zeros anyway. Brazil probably is hurt by not being surrounded by ocean like Australia which lets us have ports on other than the east side. It takes more government competence to get a railroad up and running and prevent multiple robber barons from throwing spanners in the works to try to increase their share of bribes than it does to give a mining company permission to build a port in the middle of nowhere.

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meanwhile
newwoketimes.con crookedly reframes the portland riots
"To Battle a Militarized Foe, Portland Protesters Use Umbrellas, Pool Noodles and Fire"

does anybody have any objections to the washington pangollins?

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Consider doing a CWT with Zeihan. He's smart and has really broad knowledge but falls into this pattern of making the same sort of argument over and over. He could use a wide-ranging interview that goes beyond his normal schpiel.

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As an influential Brazilianist (a "scholar, either a non-Brazilian or a Brazilian living abroad, who specializes in studying, researching, teaching and publishing about Brazil - for example, about Brazilian history, geography, culture, politics and/or language(s)"), I think such a simplistic ( and somewhat naïve) analysis understimates the cascading effects of the far-reaching reforms being carried out under Brazil's President Captain Bolsonaro's correct leadership.

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is this satire ? or just dumb as a box of hammers
https://www.vox.com/policy-and-politics/2020/7/22/21325942/free-speech-harpers-letter-bari-weiss-andrew-sullivan

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The Escarpment, by the way, refers to the cliffs that run along Brazil’s coastal zones and have kept Brazil so long from integrating their cities and building a truly stable nation-state.

Rubbish. Brazil's principal problem is hideous rates of street crime. It has other problems, among them shizzy land titles and a system of political economy that's very adept at improving La Dolce Vita of the most affluent decile and a lot less adept at generating improvements for anyone else. One problem it has not had is 'political instability'. It never went through any period where it was run by short-term caudillos. Aside from some brief interstices, Brazil's political history can be understood to consist of six periods, during only one of which (1930-45) was any sort of personalistic rule a feature. Brazil has been a constitutional state of sorts for 85% of its history as a sovereign country.

Not to mention a court system quite devoted to local protectionism.

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“ It’s too far from the Northern Hemisphere to be involved in manufacturing supply chains...”

The shipping route from Rio de Janeiro to
Rotterdam, is a total distance of 5240.63 NM with a journey time of 10.9 days at an average speed of 20 knots. This is within a pubic hair of being exactly the same as the Busan to Los Angeles route that does $15 billion per year: total distance of 5250.93NM with a journey time of 10.9 days at an average speed of 20 knots.

In comparison, New YorkNew Jersey ports to Rotterdam, Is total distance of 3342.13 NM with a journey time of 7 days. 3 days difference is not huge.

Brazil ships soybeans grown in the interior to Hamburg and Shanghai for crissakes. Distance from the northern hemisphere is simply not a relevant factor with respect to Rio de Janeiro.

To get an idea of how well connected the ports of Brazil are to the interior, check the tables in this USDA document:

https://www.ams.usda.gov/sites/default/files/media/BrazilSoybeanTransportationInfrastructureUpdate0817.pdf

As far as Tyler’s trolling about truly stable nation-states, turn on the news some time. The USA has many times more rebellious autonomous zones than Brazil. The USA could learn a lot from Brazil about how stable and mature modern democracies finance health care, achieve social security reform, balance budgets, and conduct elections consistent with modern, international standards of integrity.

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it's idiotic to blame cliffs for Brazil's problems in the face of decades of bad governance, corruption, and bad economic policy.
I followed railroads and toll roads in Brazil for over a decade, and the biggest problem was government, not physical obstacles.

I was going to write about the same, since you're close to being a fellow Viking, I will piggyback on your thread.

"The Escarpment, by the way, refers to the cliffs that run along Brazil’s coastal zones and have kept Brazil so long from integrating their cities and building a truly stable nation-state. The lack of navigable rivers throughout most of the country does not help either — North America was blessed in this regard."

This unfortunate geography, is also one of Thomas Sowell's (self serving?) explanation for Africa's lack of development.

He might really believe it, and not see it as an excuse, irregardless, on the whole, I respect him greatly.

https://www.hoover.org/research/black-man-confronts-africa

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Just nice to see my friend from Marshalltown on MR!

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"The lack of navigable rivers throughout most of the country does not help either"

Is the Amazon un-navigable? Ancient Egypt had only one major river but that river was the foundation of its civilization. Granted the parts of Brazil that are far from the Amazon would be (and indeed seem to be) hinterlands, but the parts of Brazil close to the Amazon would seem to have all the river they'd need.

Amazon river is very far from most of industrialized Brazil. None of the major waterways in Brazil uses the Amazon river itself and increasing the usage of rivers in the southern or northeast regions would likely be of greater impact.

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