Archive for the ‘Topics’ Category

16
Jan

Failing elites threaten our future

Written on January 16, 2014 by Waya Quiviger in Foreign Policy, Op Ed

In 2014, Europeans commemorate the 100th anniversary of the start of the first World War. This calamity launched three decades of savagery and stupidity, destroying most of what was good in the European civilisation of the beginning of the 20th century. In the end, as Churchill foretold in June 1940, “the New World, with all its power and might”, had to step “forth to the rescue and the liberation of the old”.

The failures of Europe’s political, economic and intellectual elites created the disaster that befell their peoples between 1914 and 1945. Their ignorance and prejudices allowed catastrophe: false ideas and bad values were at work. These included the atavistic belief, not just that empires were magnificent and profitable, but that war was glorious and controllable. It was as if a will to collective suicide seized the leaders of great nations.

Complex societies rely on their elites to get things, if not right, at least not grotesquely wrong. When elites fail, the political order is likely to collapse, as happened to the defeated powers after first World War. The Russian, German and Austrian empires vanished, bequeathing weak successors succeeded by despotism. The war also destroyed the foundations of the 19th century economy: free trade and the gold standard. Attempts to restore it produced more elite failures, this time of Americans as much as Europeans. The Great Depression did much to create the conditions for the second World War. The cold war, a conflict of democracies with a dictatorship sired by the first World War, followed.

Epic failures
The dire results of elite failures are not surprising. An implicit deal exists between elites and the people: the former obtain the privileges and perquisites of power and property; the latter, in return, obtain security and, in modern times, a measure of prosperity. If elites fail, they risk being replaced. The replacement of failed economic, bureaucratic and intellectual elites is always fraught. But, in a democracy, replacement of political elites at least is swift and clean. In a despotism, it will usually be slow and almost always bloody. Read more…

 

Martin Wolf is chief economics commentator with the Financial Times. As published on Jan. 15, 2013 in http://www.irishtimes.com

7
Jan

by Graham Allison

Precisely a hundred years ago today, the richest man in the world sent New Year’s greetings to a thousand of the most influential leaders in the U.S. and Europe announcing: mission accomplished. “International Peace,” he proclaimed, “is to prevail through the Great Powers agreeing to settle their disputes by International Law, the pen thus proving mightier than the sword.”

Having immigrated to the US penniless, created the steel industry as a pillar of America’s rise to preeminence, and become fabulously wealthy in the process, Andrew Carnegie had the confidence of a man who had achieved the impossible. When he turned from making money to spending it for public purposes, his goals were universal literacy at home (funding public libraries in cities and towns across America), and perpetual peace abroad, starting with the great powers of Europe and the US.

Events in the year that had just ended convinced Carnegie that 1914 would be the decisive turning point towards peace. Just six months earlier, his decade-long campaign culminated in the inauguration of the Peace Palace at the Hague, which he believed would become the Supreme Court of nations. The Palace was built to house the new International Court of Arbitration that would now arbitrate disputes among nations that had historically been settled by war. As theEconomist noted, “the Palace of Peace embodies the great idea that gradually law will take the place of war.”

Carnegie’s Peace Palace captured the zeitgeist of the era. The most celebrated book of the decade, The Great Illusion, published in 1910, sold over two million copies. In it, Norman Angell exposed the long-held belief that nations could advance their interests by war as an “illusion.” His analysis showed that conquest was “futile” because “the war-like do not inherit the earth.”

However inspiring his hopes, Carnegie’s vision proved the illusion. Six months after his New Year’s greeting, a Serbian terrorist assassinated the Austro-Hungarian Archduke. Nine months on, the guns of August began a slaughter on a scale that demanded a new category: “World War.” By 1918, Europe lay devastated, and a millennium in which it had been the creative center of the world was over. Read more…

Graham Allison is Director of the Harvard Kennedy School’s Belfer Center for Science and International Affairs.  Published on Jan. 1,  2014

6
Jan

The Mint countries: Next economic giants?

Written on January 6, 2014 by Waya Quiviger in International Development, News, Regions

In 2001 the world began talking about the Bric countries – Brazil, Russia, India and China – as potential powerhouses of the world economy. The term was coined by economist Jim O’Neill, who has now identified the “Mint” countries – Mexico, Indonesia, Nigeria and Turkey – as emerging economic giants. Here he explains why.

 

So what is it about the so-called Mint countries that makes them so special? Why these four countries?

 

A friend who has followed the Bric story noted sardonically that they are probably “fresher” than the Brics. What they really share beyond having a lot of people, is that at least for the next 20 years, they have really good “inner” demographics – they are all going to see a rise in the number of people eligible to work relative to those not working. This is the envy of many developed countries but also two of the Bric countries, China and Russia. So, if Mexico, Indonesia, Nigeria and Turkey get their act together, some of them could match Chinese-style double-digit rates between 2003 and 2008.

 

GDP in 2012 and 2050

 

Something else three of them share, which Mexican Foreign Minister Jose Antonio Meade Kuribrena pointed out to me, is that they all have geographical positions that should be an advantage as patterns of world trade change.  For example, Mexico is next door to the US, but also Latin America. Indonesia is in the heart of South-east Asia but also has deep connections with China. And as we all know, Turkey is in both the West and East. Nigeria is not really similar in this regard for now, partly because of Africa’s lack of development, but it could be in the future if African countries stop fighting and trade with each other.  Read more…

Published on January 6th, 2014 in the BBC Magazine, http://www.bbc.co.uk/news/magazine

 

 

2
Jan

2014: Is This Latin America’s Big Year?

Written on January 2, 2014 by Waya Quiviger in Americas, International Development, News

The 1980s were unkind to Latin America. Surging drug violence, economic turmoil, and a staggering debt crisis all led to our southern neighbors’ “lost decade”. Yet since the 2000s, things have been looking—and going—up. In fact, thanks to its strong economic growth and growing international influence, 2014 has the potential to be Latin America’s best year yet.

Latin America’s economic growth will only increase in its upward trajectory in 2014, driven by countries such as Brazil, Chile and particularly Mexico. According to theU.N., “Based on promising signs of private consumption and manufacturing, the region will see [expected] growth rates of 3.6 in 2014 and 4.1 percent in 2015, according to World Economic Situation and Prospects 2014, a report that launches in January.” The U.N. Economic Commission on Latin America forecasts that Latin-American Economic development will be the highest of all global regions for 2014. Brazil is slowing down compared to its explosive performance in recent years, but still very strong. Brazilian finance minister Guido Mantega said in December that foreign direct investment continues to be robust and, according to the Wall Street Journal, “pointed to $8.3 billion in foreign direct investment posted in November as a strong signal investors continued to favor the country. In October, the figure was $5.4 billion.” Read more…

As published in the National Interest on December 30, 2013 http://nationalinterest.org/blog/the-buzz

31
Dec

The 16 Countries That Will Replace China

Written on December 31, 2013 by Waya Quiviger in Asia, International Development

China has become a metaphor. It represents a certain phase of economic development, which is driven by low wages, foreign appetite for investment and a chaotic and disorderly development, magnificent in scale but deeply flawed in many ways. Its magnificence spawned the flaws, and the flaws helped create the magnificence.

The arcs along which nations rise and fall vary in length and slope. China’s has been long, as far as these things go, lasting for more than 30 years. The country will continue to exist and perhaps prosper, but this era of Chinese development — pyramiding on low wages to conquer global markets — is ending simply because there are now other nations with even lower wages and other advantages. China will have to behave differently from the way it does now, and thus other countries are poised to take its place.

Reshaping International Order

Since the Industrial Revolution, there have always been countries where comparative advantage in international trade has been rooted in low wages and a large work force. If these countries can capitalize on their advantages, they can transform themselves dramatically. These transformations, in turn, reorganize global power structures. Karl Kautsky, a German socialist in the early 1900s, wrote: “Half a century ago, Germany was a miserable, insignificant country, if her strength is compared with that of the Britain of that time; Japan compared with Russia in the same way. Is it conceivable that in 10 or 20 years’ time the relative strength will have remained unchanged?” Lenin also saw these changes, viewing them as both progressive and eventually revolutionary. When Kautsky and Lenin described the world, they did so to change it. But the world proved difficult to change. (It is ironic that two of the four BRIC countries had been or still are Communist countries.) Read more…

George Friedman is chairman of Stratfor.

As published in the Real Clear World on July 30, 2013 http://www.realclearworld.com

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