Lana Effect
Day 841, 02:04
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Published in Canada 
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by
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by Tyler F Durden
I will be proposing a mass overhaul to the Canadian taxation posture in Congress shortly.
I will contend that our current anti-trade posture in Lana's 'New Economy'
is not one to maintain in order to achieve sought after national goals,
namely - war.
People are addicted to Lana.
Make no mistake - many people HATE Lana.
Me? I've never used her...meh.
Lana caught on fast and furious. Some clearly love Lana. Others have found Lana's call to train as welcoming as the call of the wild.
One of my favourite eRepublik Newspapers - From The Shelf by Bogdan_L illustrates the effect of Lana upon the economy. Yesterday, Day 840 - eRomanians forked over 596.90 Gold to Lana and Napoleon raked in 500 Gold for himself.
Might as well just put his face on Gold
This kind of spending is that of the elite consumer. The consumer who doesn't need a job.
Many have a upgraded companies and earn the bulk of their income not as a worker - but as a GM.
Or, they are Supreme Commanders of vast sums of gold.
Enter the World War 3 baby-boom generation entering the corporate world - resulting in low quality company market saturation.
Canada's Income Tax is 11% across the board. Grain is currently at 6% - the lowest taxed sector by Income. Then there is Iron - which is 50% and should stay that way unless the admins give Canada the high iron or titanium it deserves. This has been put to a vote by Nosyt after I had presented the proposal to Congress.
The vote stands to pass.
The introduction of Lana into the global economy has seen an across the spectrum
degradation of wages. Hundreds and thousands of Gold are being removed from the economy daily worldwide via training, denying wealth activity in the global economy. This is not an indictment of Lana - it is addressing her effect on the economy and how our tax structure would serve us better if it were to take into account the training module.
Workers have less expendable income, therefore they purchase less.
Government continually watches it's income tax revenue stream decrease according to the
drop in wages and market activity. What this serves to accomplish is the gradual reduction in the amount of effort we can apply economically to any particular military adventure we may choose to participate in - or initiate.
Corporate Shelters, like our current tax structure reduce the ability of our Government to create and sustain consistent, entertaining war, or game play.
[img]http://farm1.static.flickr.com/38/83641334_e0d6408f17.jpg?v=0[/img]
Forget about it.
Communal systems of corporate organizing - for the first time, have a distinct advantage over the state. When the economy shrinks - that State loses. It loses income via Income Tax. It loses income in less consumer market activity. The Black Market flourishes under these circumstances and only serves to exacerbate the problem by eliminating revenue streams for the Government by facilitating extra-market transactions.
The top value market items; Hospitals, Defense Systems and Houses are rarely sold on traditional markets. Construction was the first sector to be hit by decreasing labour value with the Lana Effect and should have served as a beacon for what position we now find ourselves in economically, both personally and nationally.
eCanada's Trade Policy eliminates many opportunities for the
Government to capitalize on traditional market transactions.
The State is the biggest sole participant in our markets and
should find increased activity in it's own backyard beneficial so
that we as eCanadians get more bang for our Tax Buck and
the Government begins to stem the income tax revenue losses.
We have sheltered the eCanadian GM for a quite some time now with stiff Import Tariffs.
As we have already seen a few importers are still willing to suffer the penalty just for access to our markets. I will be proposing that we tear down that Protectionist Wall and open up our markets to the world. There will still be ample employment opportunities for the eCanadian worker - but also lower prices. If Q1 weapons were $1.71 each last summer and fall, I would have been a Field Marshall loooooooooooong ago.
If you build a wall for yourself, be not surprised if you find yourself unable to get over it.
The eCanadian Protectionist Wall only serves to keep us limited to walls we create for ourselves.
If we want reliable war - and I KNOW we all do, then we have to restructure the way our Government generates let alone maintains revenue in an economy which has seen a monumental percentage of it's consumer base's expendable income be spent in a way that does not serve his fellow Citizen - or Country. It is an intentionally designed method for eRepublik to increase it's revenue stream. The only problem is - not as many people are really willing to buy gold in order to feed the Monkey.
Feeding the Monkey, or training with Lana has exposed the belief
as being false that players would be more willing to buy gold if this
variable was enabled. All it did was remove the expected purchased
gold revenue stream come from the player's own economy - and not
from PayPal, as was desired.
Lana.
If we want to sustain a viable wartime posture for eCanada, we must first overcome the way that Lana has interfered with government revenue since we met her. Part of this starts with adapting to her and exploiting the effects that she has on competing or enemy markets. Whatever V2 does - turn Iron into Titanium, make your House deteriorate or turn water into wine, the Lana effect WILL remain. The effect of so much Citizen activity (gold) not benefiting fellow Citizens or Government via circulating has led us to where we are today economically. Every time somebody trains with Lana more wealth is removed from the Player experience.
This is a WAR GAME with an Economic Engine and should we as a people wish to participate in more war, then we would be best served to adapt and overcome the Lana Effect and fine tune our engine to the new economic reality.
Sydiot, a USA Congressman has proposed an impressively articulated organized tax proposal called the Tax and Budget Compromise Act. Worth a read.
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Comments
It doesn't seem like the eCanadian CPs (in my lifetime anyway) want to have wars.
We need more wars...and not just does for training in Philippines but something more " for real"...this is after all war game, war and gold makes the eRep going...our officials should think about that especially if they want to make a new baby boom...
good article ! more wars means more money to spend, more gold to spend on Lana, more gold to buy from owners...
it`s a game, wright..? so, someone have to make some of it 🙂
I use Napoleon everyday 🙂
Flying past all my friends who started like 20 days before me.
I don't think people get it.
Prices are at historical lows - yet, they want to allow foreign companies to flood our markets with products and drop prices even lower. The result will be massive failures of Canadian businesses, taking Canadian jobs that pay Canadians with them; and a further outflow of money from the Canadian economy to foreign nations.
Lets use some common sense here. Canada needs more jobs, not less jobs. When more Canadian employers seek to employ our workers, then salaries will start to rise again. We will be able to purchase more Canadian goods, and employ more people.
Lets stop being laughingstocks in the international economy. Some of the most economically successful nations have their tariffs at 99% across the board. Lowering ours will just be sending our money to those countries. We should be trying to bring as much money as possible INTO the Canadian economy - not the other way around. As far a Lana goes, the only ones that can change that are the Admins. Giving away our currency and gold to foreign business is not going to solve that.
Citizen B
Good article, but unless you have access to eRepublik's financial information, you can't claim that Lana hasn't increased gold purchases. I'd be very surprised if gold purchases haven't spiked after Lana.
"If Q1 weapons were $1.71 each last summer and fall, I would have been a Field Marshall loooooooooooong ago."
I doubt it. Not only the prices are at the bottom, but the wages as well. You would not be able to buy more weapons, just because they are cheaper in gold.
Didn't the eUS try this and discover it didn't make a huge impact? I seem to remember that - it's worth asking for some insider info to see how we might make adjustments.
Lana makes for a strange trade-off. Maybe there's less money but our soldiers are stronger when war comes.
Any national leader who isn't in favor of war in a war game needs a reality check. Though war isn't the only answer to our economic issues it's one. Let's use it!
I always enjoy your articles, TFD - you always give me things to consider.
How exactly would removing our trade barriers improve our warmaking ability? I'm not following the reasoning, and would appreciate clarification.
Low imports kept our markets efficient, prevented price spikes, and allowed us to cheaply deal damage with a high purchasing power. Canada has tons of RMs, and would benefit from such a system.
eCanada doesn't actually have a war making ability on its own.
I think people forget that when they cry out for war, the last time we went alone eCanada dissapeared.
Speaking of which, has Canada EVER been alone in a war?
Boom Holdings: I have no access to such numbers. Nor do you to deny validity to my argument.
Dr. Pain: it is not possible to debate a person's preferences.
I am quite right when I say that I would have been a FM a looooooooooooong time ago if Q1 weapons were $1.71 each last summer and fall.
Citizen B: We already the 'laughing stocks' of the int'l economy.
Also - nobody is rip roaring right now economically...yet all have almost identical taxation postures. We open our borders to provide better prices to Canadians who are making less money and the government wins thru VATs. Canada also becomes the place to get what you need at a great price. So what if not every company in our economy is Canadian? We will have the best prices and access to a wide field of established global GMs.
Gold spent on Lana does nothing for the economy. It benefits not the state nor the community economically. Let me ask you this; at what point do we hit the wall and are faced with the choice of succumbing to it's impediment or crashing right thru it?
\o/ Voted.
eAus recently dropped import tarriffs to 10% from 99%. Few importers entered the market iniately, but we had an immediate start of a drop in wages and prices. This was chased by a devaluing of the AUD. I have a personal opinion that since the crash began instantly more or less after the new taxs laws began, that this was a psychological effect that burst our protectionist bubble. Still, we have few to a reasonable number of importers in all sectors except weapons, where prices are ironically sky high and close to the highest in the world.
Before all of this occured, we had a massive labour shortage, with companies lucky to have 4 workers. The tax changes were brutally Darwinistic placing pressure on weak companies. Unfortunately, we are not able to determine the outcome of this as we are hosting 800 or so refugees and EDEN soldiers ... and lots of Crimson Cannucks/Guards, so now we have a labour surplus which is driving down our wages.
The hope is that by reducing prices and wages that we can become an export economy. Exporting is where it is at, because you have 60 countries to which you can export. All great countries, with a few exceptions, became that way through trade empires.
If Canada and Australia are experiencing similar economic symptoms while engaging in opposite tax structures, then there is symmetry in how Lana effects the economy - regardless of individual country tax system.
I second your point on trade empires. Ones built to suit the times - and not upon ideal conditions - which is perhaps akin to attempting to predict the distance traveled in a certain amount of time by a sailboat without knowing the wind speeds.
"Workers have less expendable income, therefore they purchase less."
I don't dispute that Lana is the primary problem, however... irrespective of Lana... Increasing taxes won't alleviate that problem and get people to spend more.
Tax cuts, on the other hand, generally stimulate the economy and people begin to spend when they feel they have a buffer to do so with. This also keeps the cashflow circulating in your country, not leaving it. By taxing people even more while allowing foreign competition in with lower Import taxes (i.e. less profit for your GM's to pass on to their workers), they're only going to clench onto their wallets even tighter, hold onto a nest egg and hope for better times... if not leave the country entirely. I'd even been considering moving to Canada for this very reason, since you're bros close to home, but... I guess not, now.
It's a trade-off. Woxan is admittedly right in what he said, but... there are also disadvantages. My personal opinion, from a taxpayer/business owner standpoint, is simply that the negatives outweigh the positives.
mmm..here's the war 😁)
http://www.erepublik.com/en/article/usa-invasion-in-asia-az-usa-zsiai-inv-zi-ja-eng-hun--1244578/1/20" target="_blank">http://www.erepublik.com/en/article/usa-[..]1/20
(they say)
I agree with Citizen B to the extent that Canada should be bringing foreign money IN and not the other way around. We're in a (I havent checked the map, but I think) pretty unique situation of having all but one HIGH region on home soil. This sets us up very well to have a large, exporting land sector.
As for getting out of the slump, I'm by no means an economist so take this with a grain of salt, but I walways thought spending our way out of it was best. If it's good enough for FDR it's good enough for me 😛 To this end I've bought 10 gifts/day and more expensive food (using the extra wellness to fight a 6th battle each day,) and I've slowly drained my company's cash reserve trying to keep my employees' wages high enough that they can have some expendable income too. Unfortunately, Aerofluff's "grab a nest egg and hide" comment sounds more appealing every day.
p.s. Paying Lana is unpatriotic. Also, they put her there so younger players could "catch up", but newer players have less invested and are even less likely to spend real money on gold for some game. Instead it seems like Lana gets used to buff out super soldier tanks even further, completely the opposite of balancing the game.
Who in the name of all that is holy made that Lana/Headless Chicken picture!?
It's almost as disgusting as the state of our economy!
It scks
"Boom Holdings: I have no access to such numbers. Nor do you to deny validity to my argument."
Tyler, that's the point. Those numbers aren't available so you can't make that claim because none of us know the truth. It doesn't mean your suggestion isn't true, it just means we have no way of knowing so we can't responsibly claim to know one way or the other.
The problem of the deflationary spiral is not Lana (though she contributes) or import tariffs. The problem is too many companies producing too many products chasing too few customers.
Just allow the supply glut to work itself out by the natural selection process of company failures and we just might keep our economy alive long enough to make it to Version 2.
Start tinkering now with import taxes or -- heaven forbid -- government subsidies and we will crash the whole economy.
if you lower income taxes so people can buy more, what are they going to buy? more Lana? or mebbe a Q higher food, or one higher Q weapon? i really don't know.
Look, all throughout history it has been the circulation of wealth that has kept prosperity consistent. Money needs to be changing hands, and with Lana it doesn't - it is removed entirely from the economy. Whether purchased or earned - that outgoing gold is wreaking havoc on all economies.
Economies who are also afraid to tackle this problem - and who have near identical tax structures.
Your companies are not going to blow up.
Your inventory is not going to disappear.
However, should we continue on and do nothing - you might as well shutter your companies and call it a day until V2 arrives...
The wait will KILL player retention and nip any baby boom in the bud before it can even get off the ground.
This ain't a Dean22 world anymore folks - we MUST adapt.
By the way, after Congress has frantically completed building it's protectionist trade wall and STILL finds no economic relief, we will return to this debate.
Mark my words.
it will be interesting to watch and contrast against eAus.
Can you keep us posted on the eAustralian economy, Wally Wilson?
And when you tear down that protectionist trade wall and make your taxes similar to what the eUS's have been for the past several months, and find no relief, we will return to this debate... And you can't say no one tried to warn you.
In fact, I don't think either option will fully protect a country from the repercussions of Lana, entirely... But I obviously agree with everything Citizen B said, and that what you're proposing will only worsen things by changing other factors. In fact, his statements about Canadian jobs could not be more spot on.
Due to this style of taxation in America, I recently sold my companies and moved them overseas. Many Americans already openly talk about how the eUS is a terrible place to run a business, and that anybody who seriously wants to make a profit opens them in another country, and exports. It's a nation of consumers more than producers (and by this I mean purchasing foreign goods, primarily, because many eUS companies are going out of business or running in the red due to stubborn GM's), which is also what's worsening that economy, because the GM's have no profits to pass on to their workers so they could buy more stuff within the eAmerican economy.
I'm just saying look into that more, and prevent yourself from making a mistake, but... it's your country, do what you will.
"By the way, after Congress has frantically completed building it's protectionist trade wall and STILL finds no economic relief, we will return to this debate. Mark my words."
You're right, Tyler. But for the wrong reason. Protectionism is only a temporary fix. It will make Canadian companies more profitable for a time and wages may rise.
However, the number of companies will rise again (or at least fewer will shut down) to grab a piece of that new profitability. The supply glut will continue until we reach a new equilibrium point.
Just let the marketplace sort itself out. The strongest companies will survive, the weakest will fail.
The solution is to match Canadian tax rates with the rest of the New World as closely as possible to avoid competitive disadvantages for our companies, workforce and government. Our product prices will then fall in line with the rest of the world, and competitive forces will take care of the rest.
The point of this gentlemen is to increase government revenue.
Whether or not I can prove that purchased gold is the only gold used to train with or citizen produced gold is being used is irrelevant.
Fact is - there are too may companies to satisfy the markets.
Tell me, why aren't wages RISING if there are too many companies?
Surely the disparity of jobs to fill vis a vis available labour would remedy this - BUT IT DOESN'T.
There are 100's fewer gold being spent in our markets DAILY.
It is not all purchased gold either. How do I know?
I know this because citizen generated gold is not returning to the economy. This is OBVIOUS - regardless of lack of proof. Whenever wealth is held from the economy - either in rl OR eRep - then the economy stagnates. End. Of. Story.
This also means that Government makes less - both from Income tax and for lack of VAT - which I never believed we should shy away from.
Look, we all want war.
Who makes war? The GM or the Gov't?