Guest
06-13-2012, 09:09 AM
Mika Brzeznski interviewed two young economist-authors on MSNBC's "Morning Joe" this morning. I recall one book was entitled Winner Take All. The other book was entitled Hybrid Reality, as I recall.
In the short interview, these were the key points made by the authors and presumably discussed in more detail in their books.
China has cash reserves of more than $3 trillion and no sovereign debt. They are using these reserves for both internal and international long-term investments to further strengthen their economy. (To put that in perspective, that amount of cash is about two years-worth of the entire U.S. Gross Domestic Product!).
They understand quite well that of their 1.3 billion citizens that 300 million are extremely wealthy but about a billion are living close to poverty. China has virtually no middle class. China's published five-year plans show extensive investments in technology and unfrastructure with objective of creating significant numbers of new jobs, many in the middle class, knowing that middle class spending will expand domestic markets for goods and services.
There are currently 25 wars going on in the world. Most are over commodities in one way or another. One author postulates that the economic and increasingly military battles of coming decades will be over the control of commodities. We've already seen wars fought over oil, diamonds, even potable water. The author theorizes that future wars in the next few decades will will be fought over oil and other fossil fuels, plus everything from minerals for machinery and products to potable water, lumber resources and arable land.
The Chinese have been investing in countries that have the resources they know thy will need and will be in short supply. There are many examples in Africa, South America, the Middle East, and recently even in Canada.
Most often, the countries where they are investing have high birth rates, an extremely low average age, very high unemployment, and weak governments. Again, there are many examples. The authors theorize that by China investing, creating new commodity-based industries and creating jobs, that a local embrace of their political beliefs will follow. The authors contrast that approach with the U.S.'s more "unilateral" approach (do it our way).
China is investing significantly in their military. But their unstated purpose appears to be solely designed to protect their economic interests as they expand around the world. Of course we know that human rights are not high on China's list of political or social objectives, and their burgeoning military strength does not appear to be designed to achieve political objectives either at home or internationally. Their military expansion seems solely designed to sustain their political power at home and protect future economic expansion internationally.
What I heard, albeit in a brief interview, I found very difficult to argue with. In fact, there is ample evidence that China's strategy is already well under way, both at home and abroad. I know that Americans still seem to react to the "red threat", the expansion of communism. That was certainly a Russian objective before the CCCP disintegrated in 1991. But there's no evidence that China has the expansion of communism beyond their borders high on their list of national objectives. However, they make no effort to disguise that their political posture is based on a theory that expanded economic success, influence and the creation of new jobs and industry in foreign countries will lead to a widened embrace of communism.
So with all that happening, what are our political leaders arguing about? Whether or not our current economic problems are the result of a previous political administration (pretty backward-looking, don't you think?); whether to repeal an expensive healthcare system (even though we have no reasonable alternative) while at the same time lowering the taxes on the most wealthy and corporations (with no reliable evidence that either will have a positive economic effect--maybe even quite the contrary); how to remove the influence of government on our lives and our economy (has that worked, is that why China has been so economically dominant in recent years?); whether one presidential candidate's business experience did or didn't create a few thousand jobs; and now, increasing political noise from both liberals and conservatives over whether we should become directly involved with our military in Syria (which has no identifiable natural resources, by the way).
What is our Congress doing? Other than a whole lot of ideological bickering, not much that I can see. They can't even agree on a federal budget, let alone any kind of long-term economic or fiscal planning. But their 'summer recess' is coming up, I suppose they're planning for that.
Maybe "disturbing" is too mild a description of my reaction, my frustration, my aggravation.
In the short interview, these were the key points made by the authors and presumably discussed in more detail in their books.
China has cash reserves of more than $3 trillion and no sovereign debt. They are using these reserves for both internal and international long-term investments to further strengthen their economy. (To put that in perspective, that amount of cash is about two years-worth of the entire U.S. Gross Domestic Product!).
They understand quite well that of their 1.3 billion citizens that 300 million are extremely wealthy but about a billion are living close to poverty. China has virtually no middle class. China's published five-year plans show extensive investments in technology and unfrastructure with objective of creating significant numbers of new jobs, many in the middle class, knowing that middle class spending will expand domestic markets for goods and services.
There are currently 25 wars going on in the world. Most are over commodities in one way or another. One author postulates that the economic and increasingly military battles of coming decades will be over the control of commodities. We've already seen wars fought over oil, diamonds, even potable water. The author theorizes that future wars in the next few decades will will be fought over oil and other fossil fuels, plus everything from minerals for machinery and products to potable water, lumber resources and arable land.
The Chinese have been investing in countries that have the resources they know thy will need and will be in short supply. There are many examples in Africa, South America, the Middle East, and recently even in Canada.
Most often, the countries where they are investing have high birth rates, an extremely low average age, very high unemployment, and weak governments. Again, there are many examples. The authors theorize that by China investing, creating new commodity-based industries and creating jobs, that a local embrace of their political beliefs will follow. The authors contrast that approach with the U.S.'s more "unilateral" approach (do it our way).
China is investing significantly in their military. But their unstated purpose appears to be solely designed to protect their economic interests as they expand around the world. Of course we know that human rights are not high on China's list of political or social objectives, and their burgeoning military strength does not appear to be designed to achieve political objectives either at home or internationally. Their military expansion seems solely designed to sustain their political power at home and protect future economic expansion internationally.
What I heard, albeit in a brief interview, I found very difficult to argue with. In fact, there is ample evidence that China's strategy is already well under way, both at home and abroad. I know that Americans still seem to react to the "red threat", the expansion of communism. That was certainly a Russian objective before the CCCP disintegrated in 1991. But there's no evidence that China has the expansion of communism beyond their borders high on their list of national objectives. However, they make no effort to disguise that their political posture is based on a theory that expanded economic success, influence and the creation of new jobs and industry in foreign countries will lead to a widened embrace of communism.
So with all that happening, what are our political leaders arguing about? Whether or not our current economic problems are the result of a previous political administration (pretty backward-looking, don't you think?); whether to repeal an expensive healthcare system (even though we have no reasonable alternative) while at the same time lowering the taxes on the most wealthy and corporations (with no reliable evidence that either will have a positive economic effect--maybe even quite the contrary); how to remove the influence of government on our lives and our economy (has that worked, is that why China has been so economically dominant in recent years?); whether one presidential candidate's business experience did or didn't create a few thousand jobs; and now, increasing political noise from both liberals and conservatives over whether we should become directly involved with our military in Syria (which has no identifiable natural resources, by the way).
What is our Congress doing? Other than a whole lot of ideological bickering, not much that I can see. They can't even agree on a federal budget, let alone any kind of long-term economic or fiscal planning. But their 'summer recess' is coming up, I suppose they're planning for that.
Maybe "disturbing" is too mild a description of my reaction, my frustration, my aggravation.