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Sri Lanka is having a textbook currency crisis, triggered by policy mistakes

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Re: Sri Lanka is having a textbook currency crisis, triggered by policy mistakes

#261

The root of all problems in these neocolonized nations is corruption. The colonizing entity (ie the dictator or the “political family” or the king) are absorbing all the profits and eliminating cushions which would otherwise help promote recovery and stability.

And they're corrupt because they were made to be when they were originally colonized. The people put in charge by foreign empires were not chosen for their commitment to democratic governance.

Re: Sri Lanka is having a textbook currency crisis, triggered by policy mistakes

#262
post #246

Earlier quoted context omitted.

Very honestly, it might have worked out fine - organic produce fetches a much higher price overseas. If its already a somewhat niche product like tea, organic produce might go even higher and make up for the loss in yield. For Sri Lanka, it was the perfect storm of covid decimating tourism AND overseas demand for their produce. Without Covid, they might have been able to stay afloat on tourism dollars until the organ…

> Very honestly, it might have worked out fine - organic produce fetches a much higher price overseas. This also affected staple crops like rice which are eaten domestically, effectively forcing the country to start importing food instead of fertilizer. It's not plausible to move the entire agricultural sector towards luxury exports by government fiat.

> It's not plausible to move the entire agricultural sector towards luxury exports by government fiat.

.. overnight.

Some countries have managed to pivot towards luxury exports, and indeed this is one of the standard things that the IMF tries to make failing countries do, but it's a multi-decade process.

Re: Sri Lanka is having a textbook currency crisis, triggered by policy mistakes

#263
post #256

Earlier quoted context omitted.

The UK has a whole government department to answer your questions: https://www.gov.uk/government/statistics/united-kingdom-food... Result: The UK grows enough wheat alone to give enough calories to support its population, with plenty to spare. It also produces all the major food groups in quite large quantities. If cut off from the world, the UK people wouldn't starve, but they might have to switch out their caviar f…

That's quite an impressive report and it's good to see someone's taking this seriously, even if they might end up ignored by whoever the agriculture secretary of the day is. > but they might have to switch out their caviar for something else That's frivolous: the report talks about meeting 100% of caloric requirements from grain in an emergency scenario. The mostly-bread diet would be comparable or worse than WW2 rat…

> The mostly-bread diet

See the section on meat, dairy, fruits, vegetables, etc... It would be a decent diet.

And obviously within a year or so, land use could be adjusted to make it an even better diet.

Re: Sri Lanka is having a textbook currency crisis, triggered by policy mistakes

#264
post #219

Earlier quoted context omitted.

> The UK hasn't been able to feed its population from native production only since before WW2. What does this mean though? That the UK does not generate enough calories to meet a certain minimum baseline? That the UK does not generate enough calories to meet the current consumption? That the UK eats things that they do not grow?

The UK has a whole government department to answer your questions: https://www.gov.uk/government/statistics/united-kingdom-food... Result: The UK grows enough wheat alone to give enough calories to support its population, with plenty to spare. It also produces all the major food groups in quite large quantities. If cut off from the world, the UK people wouldn't starve, but they might have to switch out their caviar f…

That might have been true at some point, but with all the "we have to fight Russia" rhetoric they have put that food security in jeopardy. It's by far not the only western country that does so. The Farmers protests in NL triggered by the request to massively slash nitrogen in farming are another example. It does remind be of Sri Lanka a little bit, albeit under a different pretext.

https://www.bloomberg.com/news/articles/2022-06-08/high-gas-...

Re: Sri Lanka is having a textbook currency crisis, triggered by policy mistakes

#265
post #219

Earlier quoted context omitted.

> The UK hasn't been able to feed its population from native production only since before WW2. What does this mean though? That the UK does not generate enough calories to meet a certain minimum baseline? That the UK does not generate enough calories to meet the current consumption? That the UK eats things that they do not grow?

The UK has a whole government department to answer your questions: https://www.gov.uk/government/statistics/united-kingdom-food... Result: The UK grows enough wheat alone to give enough calories to support its population, with plenty to spare. It also produces all the major food groups in quite large quantities. If cut off from the world, the UK people wouldn't starve, but they might have to switch out their caviar f…

The UK is not self-sufficient in wheat, and depending on harvests has to imports millions of tons.

"Enough wheat to give enough calories to everyone" only means that in an extreme situation and with very strict rationing nutritional needs could be met. Which is self-sufficiency at the limit only.

Re: Sri Lanka is having a textbook currency crisis, triggered by policy mistakes

#266
post #225

Earlier quoted context omitted.

The immediate problem is that the entire legal order of succession (PM, president, Speaker etc) are Rajapaksa cronies who are busily getting the hell out of Dodge^W Colombo, so it's not at all sure who is going to form or lead the next government. There are also a lot of unresolved tensions left over from the vicious civil war that devastated the island for decades, so it's sadly possible that things take a turn for…

Are there any neighboring countries which could reasonably assist in establishing a new government?

You mean carry out a coup and/or invade?

Re: Sri Lanka is having a textbook currency crisis, triggered by policy mistakes

#267
post #170

Earlier quoted context omitted.

The US is very lucky as a significant amount of people have been taught that government aid/handouts are wrong, as in generally. I'm even impressed Trump spent a few trillion and still didn't get blasted for it by most people. The only two serious politicians who spoke up about it was Ben Sasse who in a conference call with constituents said "he spends like a drunken sailor" and Ted Cruise who at the end with the las…

People in the US are only against handouts to other people who aren't them. I wonder how many people would opt out Medicare or SSI if they could? My mother in-law complained about letting refugees into the country and says we shouldn't allow due to the cost yet she is a war refugee herself. When asked about her situation, she says she deserved it. Also how many companies opted out of PPP loans.

> People in the US are only against handouts to other people who aren't them. I wonder how many people would opt out Medicare or SSI if they could?

> Also how many companies opted out of PPP loans.

This is exactly what I was going to highlight, people who use the narrative that some how a $1200 stimulus check sent nearly years ago is what is keeping people from taking low paying, dead-end jobs are the first to overlook the fact that PPP was the biggest welfare handout to the business class in some time, compounded on top of lower tax obligations. And 75% of the PPP [0] was never actually used for payroll!

It's insulting to working class people to see this narrative be as persuasive as it is, even amongst their own, but if I've learned anything about US culture is that was it 'trashy' for the lower class, is some how 'classy' for the rich. It's a pathetic attempt to divide people into already highly contentious tribes in order to maintain the illusion of business as usual.

0: https://finance.yahoo.com/video/report-shows-most-paycheck-p...

Re: Sri Lanka is having a textbook currency crisis, triggered by policy mistakes

#268

Earlier quoted context omitted.

That’s not how benefits work. Giving free things to the employees makes them richer, which increases their negotiation power, which increases their wages. They would be getting paid less without it, not more. What can cause this is welfare cliffs and systems with asset tests like SSI. Bernie does like to say this because it sounds good, but he knows it’s false.

Then why does anyone get paid government-mandated minimum wage?

You can get paid more or less on the minimum wage by e.g. having more or less working hours given to you. And some people don't use their negotiating power for increased wages, but rather for other preferences (like getting a formal job instead of an informal one, better working conditions, time with their children, etc.)

Of course there's a lot more to it than that.

Re: Sri Lanka is having a textbook currency crisis, triggered by policy mistakes

#269

The drastic move to organic farming is puzzling. Any level headed person , forget a politician , would want to experiment first, see the results, gauge and then expand selectively. That is common sense . I guess when you are a dictator ish government and you rule the country with an iron first, the institutions of the state stop being anything and simply become rubber stamps. This also underlines the importance of se…

"A wise prince acts within that which constrains him" The issue is that often people come to power based on unfulfillable promises and corruption. So the food supply is one constraint, but so is the fact you promises 1001 bribes and special favours. So now you have to deliver on the latter soon and the former can wait for months. So you do and desperately cling on. There is fundamentally no difference between this ha…

Awful lot of food banks in the UK, though. A hyperlocal kind of shortage.

https://www.macrotrends.net/2549/pound-dollar-exchange-rate-... : ouch. Hard to believe it was £1.70/$ only eight years ago. The referendum itself slips it from $1.45 to $1.30 and it never really gets back up again.

I wonder how long the government will last with energy bills doubling and diesel hovering around £2/l.

Re: Sri Lanka is having a textbook currency crisis, triggered by policy mistakes

#270

Sri Lanka is the first of possibly many countries to fall or suffer serious consequences in the next year or two. Inflation, coupled with a rally in the strength of the US Dollar, is going to push many smaller nations into resource shortages and ultimately towards revolution. Even many of the major world currencies are doing poorly. The Euro is tanking(back to parity with the dollar, for now, but it may go lower). Th…

>Industry in Germany and much of the EU about to grind to a halt.

It's been striking how little discussion there is of this in /r/europe and /r/germany. (The latter has pinned a megathread for the topic, the classic way of killing discussion.) /r/de is slightly better, if only because of the absence of the constant "I don't know German but want to move to Germany and get a job" posts.

I don't mean to say that there's been nothing, along the lines of the 100% censorship that happened at /r/news the day of the 2016 Orlando mass shooter. There has been some. But there is far, far, far less. Just this week we've had

* a German minister stating that becoming dependent on Russian gas was a "grievous mistake", and that his country is begging for turbines from Canada "with a heavy heart"

* His government stating that entire industries might "collapse"

* Rationing of gas announced

* Local municipalities planning warm buildings that those without heat in their homes can visit during the winter

This is the greatest German catastrophe in 80 years. It is an existential threat to the German (and, thus, European) economy and nation. Any other topic half as serious would occupy far more of these subreddits' front pages.

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