World-System (1950-2100) Latin America and the Donroe Doctrine

 

The 2025 National Security Strategy of the United States reinvoked the Monroe Doctrine to justify aggressive military actions against (if not outright invasions of) Latin America countries using a spheres of influence argument as justification. Moreover, previous Geopolitical Alignments (particularly Europe) that have been important to the US have been downplayed using dismissive language such as "...economic decline [of Europe] is eclipsed by the real and more stark prospect of civilizational erasure" as a result of uncontrolled immigration (p. 25).

A lot has been said already about the 2025 National Security Strategy of the United States and I will have more to say in future posts. My question in this post, however, is "what is in the best Geopolitical interests of Latin America?" I have used the LA20 model to make seven forecasts of Latin American growth based on different Geopolitical Alignments (see the graphic above):

• BAU (Business-As-Usual), that is, no Geopolitical Alignments. In terms of growth, BAU is the best future for Latin America as it provides maximal exponential growth into the Future.***
• TECH (Productivity) is a variant on BAU with no Geopolitical Alignments but focusing on doing everything to increase productivity.  It provides the next-best rate of Exponential growth.
• W (World System Linkage) Geopolitical alignment to the World System (the WL20 model) provides the third-best rate of exponential growth.
• CN (China Linkage) provides the fourth-best rate of exponential growth based on input from the WL20 China model.
• US (United States Linkage) produces growth-and-collapse, peaking between 2050 and 2100 (based on input from the USL20 model).
• RW (Random Walk) anything can happen including stagnation.
• RU (Russia Linkage) produces immediate collapse based on input from the RUL20 model.

The negative forecast for Russian Linkage should give pause to leaders such as Nicolas Maduro of Venezuela. According to ChatGPT:

Also, the exponential performance of the BAU, TECH and W forecasts should be viewed from the perspective of World-Systems Theory where the relationship between Core (US) and and Peripheral (LA) countries is viewed as exploitative.

If US Linkage is not beneficial after 2055, one benefit in the short-term is if the US would clean up the Latin American Drug Cartels. Violence created by Cartel turf Wars and the need to employe drug mules (drug smuggling) is one factor in illegal immigration to the US.

American policy should focus on enlisting regional champions that can help create

tolerable stability in the region, even beyond those partners’ borders. These nations

would help us stop illegal and destabilizing migration, neutralize cartels, nearshore

manufacturing, and develop local private economies, among other things (p.16 of the 2025 National Security Strategy of the United States).

However, according to ChatGPT:

The six forecasts above leave Latin American in a difficult situation: The US and the new "Donroe Doctrine" are intent on maintaining Latin American Dependency. Part of the Doctrine is resisting inroads to Latin America from China. I cannot say I am very confident about Latin America's future.

Please see the Boiler Plate for a discussion of data sources and how the models were constructed.

Notes

** The exponential growth forecasts do not imply that they are the "best" forecasts and the environmental consequences might be quite negative (another possibility that the 2025 National Security Strategy of the United States rejects ("...We reject the disastrous “climate change” and “Net Zero” ideologies"...p.14 ).

Blog Roll

• Six Futures for Growth of Colombia The most stable Future for Colombia focuses on Globalization. The Colombian BAU model exhibits unstable cycles.
• Growth Forecasts for Venezuela  The best future for Venezuela focuses on Technical Efficiency (not Technical Productivity). For the entire economy, Venezuela is approaching a Steady State. The best controller for Inflation in Venezuela is Globalization.
• Latin American Futures The best future for Latin America is Business-as-Usual (no Geopolitical Alignments). However, the Latin America BAU model is unstable and cyclical.
• Geopolitical Linkages: Canada, Mexico and the US Trade Wars between CA, MX and the US will benefit none of the countries.
• Future Forecasts for the EU The best forecast is to pursue Business-as-Usual with no Geopolitical Alignments.
• Latin American Geopolitical Alignment with China would benefit Latin America but would be resisted by the US.
• Future Forecasts for Argentina Business-as-Usual and Geopolitical Alignment with Russia produce uncontrolled, unstable exponential growth. Growth in Government Expenditure is out of control. Should Argentina take a Random Walk with Shock Therapy? Better System Control is needed in Argentina rather than Shock Therapy. Linking with the Latin American Regional Economy would provide a stable future growth path for Argentina; linking with the US would produce Growth-and-Collapse. Historically, the Economy of Argentina has been through many Economic Bubbles as a result of Political Mismanagement.
• Futures for Growth of Mexico Business-as-Usual and focus on Technical Productivity produce stable growth. Geopolitical Linkage with the World System, the US and China produce Collapse.
  
  

Technology Long Waves

  

The Kondratiev Wave is an important element of World-Systems Theory. The graphic above is taken from Andreas Goldschmidt and gives historical specifics for technological cycles. Goldschmidt's formulation allows for the idea to be tested (one of the models I always test), is partially consistent with economic Growth theory (particularly if we do not assume a functional form for exogenous disembodied technological change in the Solow-Swan Model) and I can present some examples.

• The Iranian Economy prior to 1979 and associated Tech Bubble.

World-System (1960-2100) CO2 Emission Forecast

 

November 12, 2025. The New York Times is reporting that Carbon Dioxide Emissions Head for Another Record in 2025. The time plot above (with Bootstrap 98% Prediction Intervals) makes the same forecast from my WL20 model. Nothing has changed since 2008, the end of my historical data in this model. How are we to understand the projection?

The IPCC has accumulated a mountain of scientific results around CO2 Emission forecasts and produced a number of alternative Emission Scenarios for the future (see the Boiler Plate). Climate Change Deniers can pick at the underlying models and the Emission Scenarios, but the underlying Kaya Identity (directed graph above) is true by definition. An increase in population (N) or any of the other extensive variables (L=Labor Q=Production and E=Energy Use) will increase CO2 Emissions unless the intensive variables (coefficients n=N/L, q=Q/L, e=E/Q, and c=CO2/E) are reduced (you can calculate the coefficients yourself from available historical data or use R-code here).

It can also be argued that the Kaya Identity has no feedback effects. As conditions in the World System deteriorate due to increasing Global Temperature (T), it should feedback to reduce all the extensive variables. For example, population growth should be reduced by heat waves, crop failures, sea level rise, famines, production and employment declines, etc. This is where state space DCM models (see the Boiler Plate) directly estimate feedback effects in the World System (see the WL20 model here and the Measurement Matrix in the Notes below). The feedback effects are from Environmental Controllers (W2=0.7705 LP - 0.235 T) and World Markets (W3 = 0.712 P.Oil. - 0.241 OIL - EF 0.293) on Overall Growth, W1.

The feedback effects are not strong enough to limit the Kaya Dynamic, that is, change the intensive coefficients. The forecast graphic at the beginning of this post, whether CO2 is driven by Carbon Emissions or driven by the World System, predicts continued exponential growth.

One way to change the Kaya Dynamic is to reduce the growth rate of Carbon Emissions in the Kaya Coefficient model (see the Notes below, change the System matrix from F[1,1]=1.07917 to F[1,1]=1.07916--a very small change that produces the graphic above). In other words, very small changes in Carbon growth rates, when linked to the World System, produce large reductions in Emissions. 

Since the World System is cyclical, emissions start to grow again around 2100. I would expect that if Carbon emissions hit zero before the 22nd Century, the World System itself  would be subject to changes that are only wildly speculative in 2025.

According to the NY Times article (here), China, the US, India and Europe are the Major CO2 emitters. I have produced a forecast for US CO2 Emissions (here). I will do the same for China, India and Europe in Future Posts.

Notes

More posts on the World System:

• Global Temperature Projections Using the World System model, Global Temperature will peak below +1.5 degrees Centigrade. Using the Kaya Model, it will not (goodbye Polar Ice Caps).
• A More Conservative Peak Oil Forecast World Oil production, and the resulting CO2 emissions, might not collapse in 2040.
• Peak Oil and Global Warming Peak Oil Production, at some time in the Future, seems reasonable but "when" is hard to predict.
• World Population Collapse Both the UN and my WL20 model predict that World Population will start to collapse after 2050. If that really happens, there will be ripple effects throughout the Kaya Identity!
• A New Axis of Evil Looks scary but they might be no better at running the World-System than the US.
• Geopolitical Linkages: Canada, Mexico and the US The Trump II Administration is tinkering with a World-System that they do not understand.
• US Attempts to Dominate India In the long-run, it would lead to the collapse of India.
• World System Steady State and Collapse The only stable, steady state future for the World System is dominance by Europe. Right now, competition between the major Hegemonic contenders (the US, Russia and China) might not produce a steady-state Future.
• Hegemonic Dominance Forecasts Dominance of the World System by Russia would lead to (1) unending exponential growth and (2) a Dystopian Nightmare.
• Six Futures for the World System The best Future for the World System involves no Hegemonic Leader.
• US CO2 Forecasts Emissions are declining in the US but the best way to reinforce the trend is to let gasoline prices increase, a political non-starter.
• Coal will make Reducing Energy Intensity Difficult Reducing the mining and burning of coal will be difficult and the Trump II Administration is trying to "Greenwash" the problem by rebranding it "Clean Coal," which it isn't.
• EU Gives Up on Climate Regulation! Really? Backtracking might simply be an admission that EU countries are reaching a steady state.
• US CO2 Emission Reduction Unlikely as a result of COP17 Steady-state emissions are more likely rather than reductions.
• World Impact Forecasts More on Impact Models, if you are interested. Impact models do not have feedback effects but they are easy to calculate by hand and maybe feedback effects are weak in the World-System.
• How to Balance the World System Wait for Growth-And-Collapse.

WL20W Measurement Model

CO2 Model

Kay Coefficient Model

WL20 Carbon Model

World-System (1970-2100) Inequality Forecasts for Italy

                     

Economy of Italy

World-Systemm (1970-2100): Geopolitical Alignment Forecasts for Italy

 

Economy of Italy

US (1960-2100) If Things are so Great, Why is Hardship in the US Increasing?

 

Measurable Hardship in the US (graphic above), is increasing and projected to increase until 2025. If US economic performance is so great, why is this happening? And, why does Hardship decrease after 2025 in the estimated model (see the Boiler Plate) above?

Quantitative Counterfactual Analysis indicates that impacts from growth in the World System are driving Hardship in the US. Decline in Hardship after 2025 is the effect of slowing growth in the World System. In other words, Growth in the World System has increased Hardship in the US even though the US is the Hegemonic leader of the World-System.

Part of the reason is that the current US Administration (Trump II) is cutting benefits for SNAP (Food Stamps) and other US Welfare programs. Why "millions of Americans" have to be on food assistance in the first place is a question that bothers me and the answer has to do with World-System forces.

The graphic at the beginning of this post is a forecast driven by outputs from the WL20 model. To determine the effect of World System forces, we can rerun the forecast with the BAU model (no input from the World System).

The BAU model shows Hardship reaching a high-level plateau after 2100. The Trump II Administration's actions to withdraw from the World-System and their attempts to cut US Welfare programs is an attempt to bring this Hardship Future into being. Increasing Hardship in the US was one of the prices of Hegemonic Leadership. 

The peak and decline of the World System would benefit the US if it still stays connected to the World-System. High levels of Hardship and World-System isolation are possibly a benefit to some elements of the US Right-Wing elite, but not most of the US Public. The Hardship Future will likely also be one of Conflict and Chaos--another potential benefit to the Right-Wing.

You can experiment yourself with the USL20 Hardship model here. For comparison, the System Matrices for the the USL20 Hardship model with World Input are presented in the Notes. Bootstrap 98% Confidence intervals for coefficients in the Systems Matrix (F) are provided in the code. Both models are stable.

Is there anything in the US Economy that controls Hardship or is it primarily driven by World System conditions? Economic theory doesn't have much (or anything) to say about Hardship. Controlling Hardship is essentially a Political Systems problem (among a lot of there things here), but current Neoliberal Ideology seems to rely on Economic growth to resolve all problems. In a future post, I'll investigate the topic of what (if anything) controls Hardship.

Notes

Hardship Index

The following indicators (from Shefner,  Roland and Pasdirtz, 2015) were used to construct the HARD (Hardship) Index. All data were taken from the World Development Indicators (WDI).

In addition to HARD1, two other indexes were constructed, HARD2 (dominated by Unemployment) and HARD3 (dominated by Inflation). Each index explained another 10% (0.841% and  0.933%, respectively) in the indicators. So, indeed, Unemployment and Inflation were important components of US Hardship, but the other indicators also played a role. Whether the US Electorate made a good choice in electing the TRUMP II administration to resolve their issues with hardship will have to wait and be seen over the next four years.

The Measurement Models for the WL20 Index and the US_HARD index are presented above. The time series forecast plots are presented below. The WL20 index first:

Growth in the World System (W1) peaks in 2040 and is forecast to decline after that. The Food-Market Index (W2=(LP+P.Wheat.-TEMP) declines throughout the period because Global Temperature is increasing and the Oil- Market-Environmental Index (W3=(P.OIL+P.WHEAT-OIL-EF-Earths) increases to a plateau in 2075.

And the the WL20 HARD index:

 

Overal Hardship (W1) increases through the period while W2 (Unemployment) and W3 (Poverty) are cyclical.

World-System (1970-2100) World Population Collapse

October 27, 2025. NPR ran a segment on how Populations are Shrinking and Altering the Global Economy. It is somewhat surprising that Population Decline has not been bigger news. It has been going on in many countries and for the entire World System (graphic above with 98% bootstrap prediction intervals).

The United Nations has essentially been making Population projections (graphic above) similar to my WL20 Model at the start of this post.

The basic theoretical model underlying the possible impact of Population Decline is the Kaya Identity (above) used by the IPCC to help understand Global Temperature Change. The Kaya Identity is true by definition (see the Boiler Plate) so any decrease in Population will not only decrease economic growth (Q) but also decrease CO2 emissions and moderate Global Temperature (T).

My models are also predicting that growth in the World System will peak before 2100 (here) as will Global Temperature (here). The reasons are that there are powerful negative feedback loops from environmental and market controllers that eventually limit growth of the World System. 

Exercises

You can experiment yourself with one of my World System models here. The models are written in the R programming language and can be run on line. Suggestions in the code, to include bootstrap confidence intervals for choosing reasonable counterfactuals, can be found in the code. The model is stable and cyclical.

Another one of my World Systems models is unstable and produces exponential growth forever (here). When it is stabilized (instructions in the code) the World System reaches a steady state after 2100.

The future could be any one of these models or something else entirely (see the Boiler Plate for IPCC Emission Scenarios). You have to ask yourself which one of the models (if any) seem reasonable.