Soren wrote on Apr 22
nd, 2010 at 7:00pm:
Indeed. Actually, just 'thinking' would go an unusually long way in this case.
The Enterprise of Nations
by David S. Landes
Critics have tried to explain away the West’s centuries-long economic domination of the globe; they would do better to study its lessons.
http://www.wilsonquarterly.com/article.cfm?AID=1613A taste:
"The older centers of hither and farther Asia—the Islamic world, India, and China—lacked the cultural and institutional foundations on which entrepreneurship rested. Worse: They tended to cling to tradition in a world of disturbing and disagreeable challenge. Both China and the Arabic Middle East offer case studies of this resistance to innovation and the subsequent national revenge against those they blamed for the economic disparities that ensued. Both impoverished themselves by insisting on their cultural, moral, and technical superiority over the barbarians around them, by refusing to learn from people they scorned as inferiors,
by simply refusing to learn. Pride is poison, and as the proverb puts it, pride goeth before a fall."
Just so.
Barbarians, like the Afghans, are barbarians because they would not learn. They think they know all there is to know. They would not learn because they think it is beneath them. Not for them 'enlightened self-interest'.
This has absolutely NOTHING to do with the topic, Soren, but it warrants a reply.
China is successful, not because it has embraced freemarket policies, but because it has maintained a form of state corporatism: keeping the yuan down, keeping wages down, and maintaining high state ownership of key industries.
The "barbarian" economies of UAE, Saudi Arabia and Kuwait have high GDPs, and in the case of the Saudis, 80% of industry is state owned.
The reason the US said they went into Iraq, if you remember (after the WMD excuse backfired), was to spread "freedom" and "democracy" throughout the region. What this meant is they wanted to open up countries like Saudi Arabia to foreign investment. Read: open them up to US markets.
The countries in your article that have supposedly done so well from free-market policies, like Ireland and Finland, have suffered hugely through the GFC and their reliance on the fickleness of the global financial markets, and herein lies the rub:
The free-trade policies championed in your article have produced nothing but financial speculation. It's not about innovation, or starting up a business and taking a risk, just the transfer of existing capital. Most speculation, like that of the big hedge funds, acts to transfer the risk to someone else. Globalization is a response to surplus capital, and a complete lack of innovation or real investment. It's also a reaction to over-supply and the need for increased growth. Globalization - and its free-market stewardship - is almost solely about commodity and currency speculation, not any trickle-down solutions for the world's poor. Most global investment is spent on corporate takeovers.
This is why Africa is still dirt-poor, and not because of the lack of air conditioning. African slaves in another era of free-market globalization did not have the luxury of air conditioning either.
And the reason Australia is so rich? Not because of any Western brains-trust or "natural" superiority, but because, like the "barbarian" economies of Saudi Arabia, UAE and Kuwait, of what lies underneath: (in our case) coal and iron ore - and China's willingness to snap it up at any price.
Lucky country indeed.
The Woodrow Wilson International Centre for Scholars seems to have missed the latest crash in world speculative markets since 1987 and 2001: the Global Financial Crisis of 2008, and the crucial lessons to be learned from this.
Interesting that your article says this:
"Both (China and Arabic countries) impoverished themselves by insisting on their cultural, moral, and technical superiority over the barbarians around them, by refusing to learn from people they scorned as inferiors, by simply refusing to learn. Pride is poison, and as the proverb puts it, pride goeth before a fall."
The US's escapade into Iraq was exactly what the argument above demonstrates: national revenge on the economic disparities that ensued from the oil crisies of the early 1970s (when Cheney and Rumsfeld were in the White House), and then the recession of 2000-2001 caused by the tech bubble bust. Not to mention the US's addiction to oil, and their unwillingness to innovate new sources of fuel.
But before you blame the Afghanis for being too arrogant to learn, ask yourself why the current situation in Afghanistan (post-Soviet invasion, post-Taliban, post-US invasion) might make it a rather unattractive site for foreign investment.
Unlike Iraq, there aren't a lot of state-owned industries to sell off two weeks after the Americans move in.
There is always the opium, I guess. And that IS doing well: the reason the heroin drought has now broken in Australia. Now there's a real global industry for you, not mere currency speculation or corporate takeover.
Anyway, back to the dancing boys...
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