In Democracy 3 if you had a surplus of cash you gained no real benefit, Would it be possible to implement something that rewards you for having a surplus like additional income thru interest payments to your country for having a surplus?
One option would be a municipal bank, which could be used to make a bunch of investments (rail, public housing, public industries) run cheaper
I absolutely agree, there should be some sort of “reward” for the player if they are somehow able to get rid of the mountain of debt that their country starts out with. I think a simple “Interest Income” based on the size of the reserves would suffice, perhaps capping the income at a certain level so it doesn’t snowball. In a way it could mirror how Norway’s Sovereign Wealth Fund provides a 4% return to government coffers (essentially its yearly interest income). The simplest way to do this is to mirror the debt interest the player pays for debt, but base it on the size of the reserves, and add it on the income side.
It’s a good idea from a game balance point of view, too. The player is essentially sacrificing spending the money on public services or lowering taxes to instead pay off the debt and accumulate reserves. For there to not be some sort of “reward” for building up reserves is unfortunate and does not mirror the real world.
Please think about adding this in, Cliff!
Its really easy to do… the only reason I have not done it, is for gameplay reasons, because I worry that this makes the game too easy once you have cleared the national debt (which frankly takes a LONG time…has anybody done this yet?). If you have no debt interest to pay AND you get free money each turn, doesn’t that raise the problem of the game becoming way too easy?
Clearing debt is relatively easy if you do neoliberal playtrough.
That is privatize everything, and have religious/conservative/patriot voter groups on your side.
Those three voter groups are often tangled by policies, that affect more than one voter group happiness.
I did “from workers for workers” playtrough - privatized everything, but gave full power to trade unionists too.
Also “minimize expenses” game is much more challenging than “implement most of policies” game.
You need to go way past Trump with this one.
Protip: Don’t delete all socialist/environmentalist policies before fully securing other voter groups.
Alternatively you could just max out two income taxes at 90% first and then fix popularity.
it is so easy and helpful to privatize everything. I did not realize how good it was until Germany started without a public health service. I dont thing the game models the negatives of not having government setting rules for the health care market. Also this ties into how easy socialists are to please. If they are harder to please you could not cancel all the state industries and insurances.
Yeah, there should be private debt crisis situation.
There is housing crisis, but not school/healthcare debt crisis for example.
Good point. I do plan to spend some time making socialists more miserable tommorow :D. I think right now they get disproportionately happy at all taxes, whereas I think in reality they should be focused on taxing the rich, and public services.
My priority though is to get france working fine, so I can release a new version (with france) on monday that also includes a bunch of new balance tweaks to other stuff…
Agreed. Currently it is very viable to basically shove problems under a privatization rug where it effectively no longer is your problem.
Like, it’s by far the fastest way to get rid of any given strike situation.
In reality, if stuff like healthcare and education are fully privatized, they’ll also see strikes. And/or terrible outcomes. Healthcare in particular is extremely hard to “get right” with incentives on private firms. Perverse incentives are everywhere. The reason is that the most important things healthcare deals with tend to be extremely inelastic goods. Like, literally “If I don’t get this, I will very soon die a slow and painful death” kind of inelastic. What kind of price might one possibly put on that? - And we see that in action in the form of utterly insane prices on freaking insulin in the US, say.
Also, tradeoffs such as “Ok I need two different treatments for two unrelated conditions, one of which might kill me any second, the other merely causing unspeakable pain. I can only afford one of them.”
I suspect it could be accomplished. But it’s gonna be very tricky. And often ultimately more expensive (both directly through subsidies and indirectly through what individual people end up paying) than if you just simply take care of it on a public level.
I’d just make the interest payments coming in from the surplus give diminishing returns as the surplus grows. Still rewards the player for early sacrifices, but not game breaking. What do you think?
Bear with me, but I think that if anything, this should be the opposite. Maybe a smaller nation in very specific circumstances like Norway might be able to get away with it, but if any of the nations in Democracy 4 actually paid down all of their public debt, it would basically turn their economy over and cause no end of trouble.
For one thing, bond markets regularly use the return on public debt as their benchmark for the risk-free interest rate. Tons of institutions are contractually or legally obligated to invest a certain amount into public debt, even. And just based on accounting identities, if the government has surplus cash, then the private and foreign sectors have to be that much in debt to it - a situation that we don’t really know what it looks like, because it hasn’t happened in modernity. Nations are not companies, and they certainly are not families - their reasons for taking on debt are different.
And that’s not to mention the enormous amount of political pressure to provide more services and lower taxes that there would be. There’s going to be a lot of voters who consider that money theirs, since after all, it probably was.
I’m not sure how you’d model those effects in D4. Well, the political pressure is pretty simple: Just have both capitalists and socialists hate having the debt/GDP ratio be too low. But with the economic effects, it’s hard to say because, as mentioned, it’s uncharted territory in reality, and anyway I don’t know very much economics. Maybe the dearth of investable money could show up as a drag on employment, productivity and/or industrial automation, or even just GDP; unhappiness and lower income to retirees; and a higher currency strength. the point is, however the game handles it, the government of a major world economy should not expect to get away with paying down too much of its debt too fast.
Then if you manage to navigate past that, I suppose the game might as well decide that you’ve won and give you your interest on surplus cash.
This is a really great idea and one I’d love to see implemented. Having said that, a few previous comments have picked up the issues around the fact that this has never been done and the practical implications of a major economy running a surplus.
In order to prevent the snowballing effect, you could consider the surplus ‘fluctuating’ over time to represent the growth and decline of the ‘investments’ more accurately. Think of it a little more like a real SWF than an abstract pot that does nothing but grow. It should be increasingly hard to grow this fund over time due to the law of diminishing returns (the more money you invest, the harder it is to identify sufficiently high returning investments that are of a suitable size).
if the surplus fluctuates, then so would the debt interest, right?
You’re talking about some extremely complex real-world concepts that, as an economist, are easy for me to grasp. But for anyone who isn’t, it would be quite difficult to get their heads around, especially if they’re just looking to play a game. For the sake of simplicity and in the interest of gaming, going debt-free should be a somewhat rewarding experience, especially since its so difficult to do. You’re already sacrificing lots to get rid of your debt - you’re probably underfunding your services and/or have high taxes that reduce growth or increase poverty. That should be painful enough on the way to being debt-free. I’ve only managed to get rid of my debt as Germany so far, and it took 4-5 full terms to do, with high taxes and only moderate spending during that time (and without the game-y way of implementing both income taxes). I can’t even begin to imagine tackling US’ massive debt without doing some serious damage to your country.
The point is, yes, in the real world there are many downsides to having zero government debt, and governments taking on debt is, in fact, a very good thing for the world, as long as it doesn’t get out of hand. But for the purposes of simplicity and in the interest of keeping the game fun and rewarding, there should at least be SOME benefit to going debt-free. If not interest income, as Cliff correctly pointed out that it might lead to snowballing, then at least some sort of way to address challenges facing your country using the surplus money you’ve built up. Perhaps there could be dilemmas regarding the creation of a sovereign wealth fund, which you could then direct to invest in either climate measures (to improve the environment), economic measures (to improve productivity or reduce unemployment) or foreign aid measures (to improve foreign relations and international trade). I have no idea if that’s doable or balanced or anything, they’re just some ideas off the top of my head. The point is, there should at least be some interaction on the game’s part regarding the player’s debt-free status. As it currently stands, the game doesn’t even acknowledge that you’re debt free in any way!
So basically like three more policies which only work on surplus money and take that money to boost those three stats directly?
Not policies, but a dilemma. I don’t think it would make sense to have policies specifically for having no debt, I don’t even know if that would be possible. So instead, one of those 3 choice dilemmas could trigger once you have no debt, and from there you can decide what to do with it, just like regular dilemmas. And of course, the choices could be different. The three I mentioned above were just off the top of my head.
Ah so you can just periodically invest money into one of those stats? I feel like that’s only worth it in terms of game mechanics, if it’s a pretty persistent effect though. Like, it’d have to be refreshable, assuming you manage to keep making a surplus.
Yeah, a refreshable one is what I had in mind. Maybe the choices are different every time, I don’t know. Honestly I just want the game to reward or even just acknowledge the fact that you have gotten rid of the entire debt and now have a surplus. It’s quite strange that it is of no consequence so far.