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An Ottoman warning for indebted America
Webdiarist Peter Hindrup drew my attention to this article a few days ago. Thanks, Peter, I found it very interesting and hope that other 'diarists do too. Niall Ferguson is a professor at Harvard University and Harvard Business School and a senior fellow of the Hoover Institution, Stanford. This article first appeared in the Financial Times on 1 January 2008. In brief, Ferguson draws an analogy between the transfer of financial power from the Middle and Far Eastern empires - the Ottoman, Persian, and Chinese - to Western countries during the 1870s and the present shift of financial power from the West to the Middle East and China.
UPDATE: I have had to remove all but the opening and closing paragraphs of the article, as its continued appearance in full on Webdiary requires the payment of a fee which we cannot afford.
Future historians will look back on the current decade as a turning point comparable with that of the Seventies. No, not the 1970s. This is not going to be another piece pointing out the coincidence of an unpopular Republican president, soaring oil prices, a sagging dollar and an unwinnable faraway war. I am talking about the 1870s.
At first sight, the resemblances across 130 years may not seem obvious. The 1870s were a time when conservative leaders such as Benjamin Disraeli, British prime minister, were powerful and popular. It was a time of falling commodity prices, after the financial crash of 1873 and the opening up of the American plains to agriculture. And it was an era of currency stability, as one country after another followed the British lead by pegging to gold.
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It remains to be seen how quickly today’s financial shift will be followed by a comparable geopolitical shift in favour of the new export and energy empires of the east. Suffice to say that the historical analogy does not bode well for America’s quasi-imperial network of bases and allies across the Middle East and Asia. Debtor empires sooner or later have to do more than just sell shares to satisfy their creditors.
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socialism and democracy are brothers in ideological arms
“The days of the horse and cart may yet be a thing of the future. Don't look a gift horse in the mouth, I say! “
That could be so, Daniel, but it may only be for those who don't prepare in some way. I run my 4x4 on vegetable oil, as a combination of used oil and some we have grown ourselves, which is very easy and extremely cost effective and has no need to affect food oil production which mainly goes towards creating illness in humans through deep fried junk and being placed in feed stock for feed lot and dairy animals.
Eliot, I always find it hard to understand why ideologists continue to try and blame their cousins in ideology, when if the truth be really known there is virtually no difference between supposed democracy and socialism. They both vest control in the elite, not the people. In the case of socialism, it’s the self elected suppressive elite, with democracy and capitalism, it's the academic and economic elitists. There has never been a time when the people have had direct control over society and the future. Those times they thought they may have, it was only the ideologists giving them that impression, whilst strengthening their power base with more suppression and fear. We see that occurring in our own country at this time and as usual, the elitist ideologists are so brain dead, they just repeat the same mistakes as in the past, but on a bigger scale.
Chinese script writers strike shows benefits of socialism
You can see the sheer brutality of the American system and why socialists everywhere decry American capitalism by watching the Hollywood Script Writers Strikers in action. And by comparing it with strikes in Socialist countries like Cuba and North Korea.
The film and television industry in the USA ranks with the aerospace, IT and automobile industries in terms of its importance to the American economy.
In the United States, the movie industry employs over 750,000 people - more than 350,000 people are directly employed and almost 400,000 are indirectly employed by the motion picture industry as drivers, food personnel, carpenters, electricians and the like.
It's also a major export earner. Jack Valenti, head of the US Motion Pictures Association, told US Senators in 1991 that 40 per cent of the revenues of the US fil industry were earned abroad. *
* (Source: Donald Sassoon, The Culture of the Europeans from 1800 to the Present, Harper Press, London 2006 )
United States copyright based industries such as movies, home video and television programming, music and sound recordings, books, video games and software continue to be one America's largest and fastest growing economic assets.
Core Copyright industries are responsible for an estimated 6% of the nation's total GDP totaling $626 billion a year.
Copyright industries had an annual employment growth rate of 3.19% per year - a rate more than double the annual employment growth rate achieved by the economy as a whole.
Most of this activity is concentrated in California where even the Governor is a movie actor and producer.
The current strike has been going on for weeks and must be a crippling burden to the US, and especially Californian economy.
This despite the fact the writers could be easily by-passed, with doubtless many throudands of people around the world only too willing and able to take their places.
How many scripts must be written by aspiring script writers in just Canada, Australia, the UK, New Zealand and other English speaking countries alone?
How hard would it be to emial a script outline and treatment to a US movie studio?
Yet the picket lines hold, due largely to the solidarity of actors, set and location crew.
It is as if Chinese white goods appliance and toy manufacturing workers went on strike and then Chinese exporters, retailers, transport workers, even the Chinese police gave them their support, openly defying the Chinese businessand political leadership.
Day after day, week anter week.
Or if Cuban agricultural workers went on strike, and dock workers, agricultural scientists and local Communist Party officials refused to cross their picket lines.
And the Chinese and Cuban governments didn't send in the troops to smash the picket lines or kill the strike organisers.
That would happen, wouldn't it Michael? That's why Socialism is so much better than Democracy.
Greed and aggression the end of the US
With the Dow Jones falling yet another 238 points overnight and the price of oil still sitting near $100 pbl, its easy to see why the US economy is in trouble and Australia is likely to follow if we continue on the same path. We must look at everything we do and buy. The era of cheap energy is over and heavy four wheel drives are a thing of the past. Just like the horse and cart.
Don't speak too soon, John!
The Veggie Patch
One of my lasting memories is tending the veggie patch my grandfather grew in every house we lived in. As a "share crop farmer" (a la the Rudd family) it was normal practice for him if not most of his generation.
It's odd that the great Aussie ambition - the half acre lot isn't for the most obvious thing - growing your own but then I think most councils these days forbid it. Certainly you can't have a chook pen - something we had in the heart of the North Shore.
It's all part of the folly of rampant capitalism that will eat itself in the end. So much easier to hand over these tasks to a corporation. Thus you have the dreaded WalMart in the USA as an example of what to avoid. Gobbling up every small town business, reducing jobs (and saying the opposite) and having every good manufactured in China (destroying US manufacturing) which wouldn't be so bad except the ultimate aim is to enrich a small band of major shareholders who give back nought.
Flying off to QLD on Tiger shouldn't be a guilt ridden trip but, combined with everything else, it's just part of the problem - which I contribute to as well.
US stock market see's worst three day start to a year since 1932
Hillary Clinton points to the plunge on Wall Street. Is the US heading towards the worst recession since the great depression? Are we witnessing the end of the American dream? 2008 is going to be a very interesting year. It seems we are at an economic crossroad. Let us hope the newly elected Rudd government has the courage and wisdom to lead Australia through the coming economic crisis.
Prosperity is a problem the good old days are numbered
As China and India continue to grow their economies the finite resources of the world are being stretched to the limit. World leaders seem incapable of finding solutions to the problem. Is greed going to be the end of the human race?
Mea Culpa
We spent our holidays on the Gold & Sunshine Coasts with family members who live in Queensland. We flew there care of Tiger Airway's beneficence ($19 each way tickets).
We are part of the problem!
There is no comparison between the real cost of our flight and the payments made by the passengers on our half-filled plane. But if Tiger shows no business prudence, expecting future profitable gains for ridiculously low prices today, I will do it again. When Tiger charges between $400-800 each way, we won't go.
Either way they can go broke. I don't care.
Over 1 million visitors pile into Queensland over the holiday period. As the real costs of travel and doing business start to bite, our much vaunted tourism industry will go the way of dodo. There will be much weeping and gnashing of teeth.
Time to start cultivating the vegie patch, convert the lawn to something useful and spend your vacations doing leisurely strolls around the neighbourhood, something which we did when I was a kid.
It won't be just the USA
It won't be just the USA that goes down. Have a look at the massive debt most western societies have and particularly Aus. When you build societies on hope and paper, they collapse in the end. What's interesting is there may not be other countries which can take the reins as they are also suffering more and more environmental and sociological dysfunction, plus they all rely on fossil energies for their economic stability and follow the same economic dogmatic mantra. One thing's for sure, we can't expect anything of a positive nature from our governments, or for that matter our business communities. Economic growth is their only aim and that's reached the top of the hill and is well on the way down the other side.
The End Of Civilisation
When you have a bunch of rampant anti-capitalists in the White House what can you expect ?.
It's the end of the American Empire and the rest of the world will be picking up the pieces.
Ceto and the end of the Oil Age.
Wave energy technology currently on trial in Western Australia may hold the promise of cheap alternative energy. Someone on Webdiary pointed to this technology on another thread about two or three weeks ago. Trials have been successfully completed the next step is commercial production.
Fiona: It was David Lankshear on the Open Letter to the PM thread, John.
The decline in Western financial influence in the last twenty years or so has been due to the way we have clung to ageing technologies. The winners in the next twenty years will be those that embrace the emerging technologies, such as wave power. The future is up for grabs but the next five years are critical.