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December 2, 2015 6:42 AM   Subscribe

It’s a Trap: Emperor Palpatine’s Poison Pill by Zachary Feinstein [.PDF]
In this paper we study the financial repercussions of the destruction of two fully armed and operational moon-sized battle stations (“Death Stars”) in a 4-year period and the dissolution of the galactic government in Star Wars. The emphasis of this work is to calibrate and simulate a model of the banking and financial systems within the galaxy. Along these lines, we measure the level of systemic risk that may have been generated by the death of Emperor Palpatine and the destruction of the second Death Star. We conclude by finding the economic resources the Rebel Alliance would need to have in reserve in order to prevent a financial crisis from gripping the galaxy through an optimally allocated banking bailout.
via: Popular Science
In this case study we found that the Rebel Alliance would need to prepare a bailout of at least 15%, and likely at least 20%, of GGP [Gross Galactic Product] in order to mitigate the systemic risks and the sudden and catastrophic economic collapse. Without such funds at the ready, it likely the Galactic economy would enter an economic depression of astronomical proportions.
posted by Fizz (38 comments total) 20 users marked this as a favorite
 
Education. It's never a waste.
posted by prepmonkey at 6:51 AM on December 2, 2015 [2 favorites]


Now someone needs to write a legal paper outlining the legal action that Indiana Jones would face for all of the laws he breaks for the many artifacts he's stolen from various countries/nations over the years.
posted by Fizz at 6:56 AM on December 2, 2015 [10 favorites]


They're dramatically underestimating the negative economic impact of a dictatorial regime on economic growth and entrepreneurship. How capable are you of enforcing a contract with an evil space wizard who can electrocute you at will? We already know Sith Lords' feelings toward contract disputes, "I am altering the deal. Pray I don't alter it any further."

The re-emergence of a functioning bureaucracy (dissolved under the Tarkin Doctrine because "Fear will keep the local systems in line,") and civil society under the new Republic would far outstrip any war losses. See postwar and post communist Europe, for example.
posted by leotrotsky at 6:59 AM on December 2, 2015 [30 favorites]


In a four year period? Really?
posted by nevercalm at 7:00 AM on December 2, 2015


"I am altering the deal. Pray I don't alter it any further."

That line always bothered me. Pray to who? Batman? Endor C-3PO?
posted by nevercalm at 7:01 AM on December 2, 2015 [5 favorites]


Related (and previously discussed on Metafilter at some point): Krugman (1978, 2010) taking a first stab at the economics of interstellar trade.
posted by dismas at 7:03 AM on December 2, 2015 [2 favorites]


"I am altering the deal. Pray I don't alter it any further."

Better Call Maul!
posted by Fizz at 7:06 AM on December 2, 2015 [13 favorites]


I think the bigger question is the cost to the Rebellion of the emergency evacuation of the Ewoks. They just blew up a moon-sized object in low orbit around their home planet (technically moon).

To quote a treatise on this atrocity:
The most important consequence following the debris shower is what has been called "nuclear winter effect". This kind of cataclysm is believed to have befallen Earth on several occasions, each time due to the natural impact of an asteroid or comet. One such episode was the mass-extinction 65 million years ago (which eliminated a majority of extant species, including dinosaurs). Atmospheric dust blocks sunlight from reaching the surface, casting a pall of twilight and causing temperatures to plummet. Vegetation dies due to lack of light; and this causes starvation of herbivores. Carnivores persist for a while by feeding on carcasses, but they too must perish. Only tiny, hardy, primitive animals of rodent size or less may survive through the cold dark years. After several years, the fallout gradually settles, leaving behind a devastated biosphere in which a majority of the former species have perished.
Any Ewok not evacuated from the planet in short order is going to die, and the Ewok race, as a result of the Rebellion's actions, will now live in a state of permanent diaspora.
posted by tocts at 7:09 AM on December 2, 2015 [4 favorites]


Related (and previously discussed on Metafilter at some point): Krugman (1978, 2010) taking a first stab at the economics of interstellar trade.

Our own cstross takes an interesting stab at this in his Neptune's Brood with the concept of slow money and fast money (the interaction of which, to be honest, I still don't entirely grasp).
posted by leotrotsky at 7:09 AM on December 2, 2015 [3 favorites]


Endor C-3PO?

This religion would be classified as a tax exempt organization, correct? Asking for an Ewok friend.
posted by Fizz at 7:13 AM on December 2, 2015 [7 favorites]


Now someone needs to write a legal paper outlining the legal action that Indiana Jones would face for all of the laws he breaks for the many artifacts he's stolen from various countries/nations over the years.
posted by Fizz at 6:56 AM


Well, he didn't get tenure.
posted by the phlegmatic king at 7:24 AM on December 2, 2015 [5 favorites]


Nothing a third Death Star can't fix.
posted by fairmettle at 7:27 AM on December 2, 2015 [21 favorites]


Do we even have an idea of how the "Galactic economy" is structured and functions? How do you model these effects without that?
posted by echocollate at 7:29 AM on December 2, 2015 [2 favorites]


Hmm... IANAE, but...

I think Feinstein makes a mistake when he assumes that the Galactic Empire was just as invested in the Death Star I as the U.S. was invested in the Manhattan project. I don't think you can just assume those two projects were equally "important" and calculate the entire galactic domestic product just from the cost of the first Death Star. My much simpler calculation for the galactic domestic product: Earth's world domestic product (78*10^12) * number of member planets (1.75*10^6 from the article) gives me an estimated galactic.d.p. of (1.365*10^20), which is considerably higher than the 4.6*10^18 that they come up with. This places the 515.5*10^15 debt he talks about at a much more reasonable .4% of gdp instead of 11.2% of gdp. That places the construction of Death Star II at just about equal to (actually a little less than) the percentage investment in the Manhattan Project in 1944, which isn't too unreasonable considering that was when both of those two projects were both under time pressure.

My tentative conclusion: The Emperor didn't rush the Death Star 1, possibly because it was really just a toy and the Emperor didn't care when it was built, or possibly because the senate was blocking the expenditure, we remember that he dissolved the senate just after DS1 was completed; but DS2 was serious business, because destruction of a battle moon leads to anger and anger leads to hate, so that got a rush on it on par with the Manhattan project at the end of the war.

I have now officially thought too much about this.

on preview: oh hi, echocollate, perfect timing.
posted by yeolcoatl at 7:33 AM on December 2, 2015 [6 favorites]


Do we even have an idea of how the "Galactic economy" is structured and functions? How do you model these effects without that?

Mr. Feinstein does outline the terms by which he projects these economic models. It's detailed in his paper.
For the remainder of the banking and financial sector of the Galactic Empire we assume, as per Wookieepedia (n.d.a), “there were many banks in the galaxy.” Given 1.75 million full member worlds of the Galactic Empire (cf. Fry & Wallace (2009)), we will make the assumption that for every 100 worlds there is a “big” bank. Further, 1 of every 100 of these banks is of a “massive” size, but not “too big to fail.” 10 This produces 17,501 banks in the galaxy for our model. We will assume all other banks are of smaller size and not of systemic importance.
That was just one example that I pulled from his paper. That being said, yes, much of his work is based on conjecture. But within those terms, its still interesting to think about.
posted by Fizz at 7:35 AM on December 2, 2015 [2 favorites]


Any Ewok not evacuated from the planet in short order is going to die, and the Ewok race, as a result of the Rebellion's actions, will now live in a state of permanent diaspora.

The answer (raised after this was) was that the Rebel fleet blasted/destroyed all the big bits before they could rain destruction on the forest moon.

Incidentally, I didn't see (missed it?) any reference to slave labor, which the Empire did employ in its industrial complex (slavery is referenced in a number of new canon materials, such as Aftermath). This would have reduced the costs of production of at least the raw ingredients. Likewise, in A New Dawn, the Empire is shown explicitly employing cost saving (at the expense of lives) measures to get the material needed as cheaply as possible (they were ready to blow up a moon). In Lost Stars, the Empire takes over raw mineral production, as well, with a goal on decreasing the costs of production. (These are all part of the new canon.)

There's also the consideration that since the Empire was born from the Old Republic at a time when that government was in the midst of a war, the production facilities were already in place, negating any major additional capital costs of building them for the job. (Likewise, R&D, as shown in Attack of the Clones, was begun by the Separatists, not the Old Republic government, and that would have been funded by the Banking Clan, which was a member of the Separatist movement.)

Regardless, I applaud this effort!
posted by Atreides at 7:42 AM on December 2, 2015 [3 favorites]


Star Wars VII: The Force(d) Awakens Austerity
posted by nubs at 7:43 AM on December 2, 2015 [17 favorites]


The Emperor did not die in the attack on the second Death Star. That is propaganda being spread by rebel scum to destabilise the Empire.
posted by drezdn at 7:48 AM on December 2, 2015 [4 favorites]


Based on what we saw in the prequels, the republic had a somewhat laissez faire approach to the economy, not financing a standing army and with little in the way of policing, essentially tolerating a free market that would embarrass even modern Americans, and extending even to slavery. The only policing appears to come from the very limited scope of the Jedi and this tends to serve political goals not those of the people of the planets. This tends to suggest planets become wealthy under their own steam or remain less wealthy, though one can imagine planets such as Coruscant doing well as a result of spending relating to the location of the Senate.

What is not made clear is where the financing for the clone army comes from.

The capture of the Galactic polity by the Empire inevitably brings changes, not least those arising from the Emperor's control issues, but these do not all appear to be negative.

On the positive side, the stormtroopers seem to act as a police force by IV and have become more representative of the people since they are apparently no longer clones. They have also evolved separate officer and trooper classes, and this may potentially say something about a burgeoning middle class with a more interstellar perspective.

If we accept that the Republic was a very light touch economic regulator then the switch in the economic framework to draw down funds and produce DS1 (not to mention the predecessing Imperial fleet) represents a huge change in the economic operation of the galaxy, and possibly a form of Keynesian economic stimulus that we have not seen previously. What we don't know is the state of the funds available to either government. If the economy was in good shape and funds had been put by for a rainy day and then took a down turn prior to DS1 then this kind of large scale spending might well have been financially appropriate to stimulate the economy. If this was perceived as successful (or if no-one wanted to argue with the Emperor) then this might have led to DS2. Both may be economically justifiable.

From the Imperial perspective, it might also be argued that the more expensive Death Star is the one you don't build.
posted by biffa at 8:02 AM on December 2, 2015 [1 favorite]


Any Ewok not evacuated from the planet in short order is going to die, and the Ewok race, as a result of the Rebellion's actions, will now live in a state of permanent diaspora.

On the plus side, Ewoks are extremely flammable, so whichever Ewok draws the short straw at intervals will help his or her tribemates stay warm on those long wintry nights.
posted by delfin at 8:05 AM on December 2, 2015 [9 favorites]


What is not made clear is where the financing for the clone army comes from.

One of the difficulties with the reification of most things Star Wars is that a completely valid in-universe explanation for literally anything is, "A quasi-omniscient space wizard who is also Hitler did it."
posted by Copronymus at 8:07 AM on December 2, 2015 [11 favorites]


Oh, and I suppose I should mention that that .4% is spread over several years for the DS2, as opposed to one year for the Manhattan project. So actually less urgent.
posted by yeolcoatl at 8:11 AM on December 2, 2015


That line always bothered me. Pray to who? Batman? Endor C-3PO?

I'm so glad someone finally asked about the constructs of the pantheon and heaven/hell in the Star Wars mythos! (c.f. Han Solo exhorting Darth Vader to "go to hell")
posted by Mayor West at 8:31 AM on December 2, 2015 [4 favorites]


"I am altering the deal. Pray I don't alter it any further."

That line always bothered me. Pray to who? Batman? Endor C-3PO?


At the risk of being pedantic, while the term "pray" in modern usage means to address a deity or a higher power, it used to have a meaning more like "ask in a humble manner" (Webster). So you might say to the king "I pray you might let me do such and such."

So I think Vader is kind of referring to himself.

Or maybe it was just a scriptwriter using common vernacular.
posted by randomkeystrike at 8:32 AM on December 2, 2015 [6 favorites]


And people say that academia is useless.
posted by Automocar at 8:33 AM on December 2, 2015 [3 favorites]


Now someone needs to write a legal paper outlining the legal action that Indiana Jones would face for all of the laws he breaks

On The Best Show they had a lawyer on to do a segment called Showbiz Crimes which included charges and likely sentences. IJ would be put away for a long, long time.
posted by munchingzombie at 8:37 AM on December 2, 2015


Is there a half-meter-long German word to express how I felt when the big reveal in RotJ was just... half of the big reveal from the first movie, again?
posted by Rat Spatula at 8:44 AM on December 2, 2015


At the end of Revenge of the Sith, where you see Vader and Palpatine, standing before a vast bay window, looking out upon the construction of the Death Star…

Vader: "How long did you say this was going to take, again?"

Palpatine" "Twenty years…"

Vader exhales audibly, and slumps...
posted by littlejohnnyjewel at 8:44 AM on December 2, 2015 [4 favorites]


Vader: "How long did you say this was going to take, again?"
Palpatine" "Twenty years…"


But think of all the job growth generated by the building of this Death Star. Local space contractors, space food-trucks, electricians, plumbers, laborers, etc.

Even with slave labour, there are going to be some jobs that can only be performed by trusted Empire technicians. I mean would you want a possible Rebel to set up your wifi router?
posted by Fizz at 9:07 AM on December 2, 2015 [4 favorites]


civil society under the new Republic would far outstrip any war losses. See postwar and post communist Europe, for example.

Post-Soviet Russia is a counterexample. One could easily imagine the rebellion sweeping in kleptocrats. Self-styled princesses and princes are hardly paragons of egalitarian democracy.
posted by justsomebodythatyouusedtoknow at 10:04 AM on December 2, 2015 [3 favorites]


But think of all the job growth generated by the building of this Death Star. Local space contractors, space food-trucks, electricians, plumbers, laborers, etc.

Even with slave labour, there are going to be some jobs that can only be performed by trusted Empire technicians. I mean would you want a possible Rebel to set up your wifi router?


So Darth Vader was actually a Teamsters officer?

...This explains much.
posted by delfin at 10:35 AM on December 2, 2015 [1 favorite]


Nothing a couple of Ferengi with good lobes for business couldn't clear up in an afternoon with some creative accounting.
posted by DevilsAdvocate at 10:46 AM on December 2, 2015


Nothing a couple of Ferengi with good lobes for business couldn't clear up in an afternoon with some creative accounting.

As if the Star Wars universe needs unsavory Ferengi businessmen.

The Intergalactic Banking Clan already has Mak Plain.
Plain: "We will lend the Republic at our standard interest rate of… twenty-five percent."
Amidala: "What?!"
Farr: "Twenty-five percent? That's outright theft!"
―Plain, Amidala, and Farr discuss the new lending arrangement
There's also Nute Gunray, Minister of the Trade Federation.
"I never risk my own skin if I don't have to."
―Nute Gunray, to Ahsoka Tano
There are plenty of Wallstreet type thieves and criminals within the expanded Star Wars Universe.
posted by Fizz at 11:08 AM on December 2, 2015 [2 favorites]


Plain, Amidala, and Farr discuss the new lending arrangement

Any relation to Pon Farr?
posted by biffa at 11:11 AM on December 2, 2015


Metafilter: a half-meter-long German word
posted by Bringer Tom at 4:56 PM on December 2, 2015 [1 favorite]


The Galactic economy is a mess. Poverty, slavery and child labor appear common place. Trade and commerce is shown to be mostly in the hands of criminal syndicates. The central state fails to deliver any meaningful services to citizens.

The collapse of the old Republic is triggered by a trade dispute and the Senate's over reliance on religious fanatics to fix things at the point of a sword.

Not that the Empire does any better. They blew up Alderan. That's like becoming emperor of the US and deciding to blow up New York State as an example.
posted by humanfont at 6:33 PM on December 2, 2015 [3 favorites]


Death stars are essentially military keynesianism, with an incredibly low economic multiplier. Arguably a direct cash transfer from the citizens of the republic to the military industrial complex.
posted by Freen at 7:38 PM on December 2, 2015


Some entrepreneurial stormtroopers have taken a page from the gig economy and found themselves a part-time seasonal job - setting up Christmas trees. (Non-facebook link)

Tip: Pay attention to the action in the background as well.
posted by cynical pinnacle at 8:13 AM on December 3, 2015 [1 favorite]


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