China: The Next Ownership Society?
So my parents are in town, which is rare, stressful, and exhausting. It can also be exhilerating, as it was over dinner tonight at my (and my mother's) favorite little New York restaurant. My father is a prohititively smart and successful businessman, and my mom the great conversationalist. As I've grown older, I've begun to appreciate my mother's intellect more and more, as she's grown more and more curious, and more into her own beliefs, and her own willingness to defend them (being high-profile liberal Democrats in Houston and Oklahoma requires thick skin.) But tonight we were discussing economics, vis-a-vis China, Inc., Freakonomics, and The World is Flat. I haven't yet read any of these, though I'm anxious for the chance, and was flying by the seat of my pants in the arguments. Needless to say, It was one of the most fascinating conversations I've ever had.
It ranged from Steve Jobs - my father was arguing that Macs were prohibitively priced and that Apple wouldn't survive with only the entertainment industry as a consumer base, whereas I was arguing that America is looking at computer purchases much as they used to view auto purchases, and that consumers would continue to move towards the higher-end, superior product - to globalization - the question of what, exactly, globalism means when the process is simply a reaching out for more exploitable parties - to China, which was the greatest point of contention. My father's doomsday view (also my mother's) is that China will "own the twenty-first century" due to an unprecedented amount of labor and investment in U.S. debt, and the fact that, while U.S. kids line up for days to see Star Wars or their favorite band, whereas Asian kids will line up for days to hear Bill Gates speak. I countered that U.S. power never really came from working the hardest, but from being founded by landed gentry (and thus having the best head-start of any nation in history) and that our international economic power came from spending. As far as I can see, the U.S. has had a near-monopsony in the world stage on oil and most manufacturing, and that as long as we're the buyers, the others will cater to us. He countered that by outsourcing and deficit spending, we're selling ourselves to Aisa (which is true) while I countered that the Chinese (and Japanese) economies are largely based on eficiency improvements on American innovations, and that the Chinese and Japanese bad-debt levels keep them from being able to confidently invest in their own innovations, thus remaining reliant on the U.S. Also, China's inclusivity and nationalism make them a poor candidate for soft power, which the U.S. has a stranglehold on.
Still, I like to think that I'm smart enough to know when I don't know enough, so I want your thoughts. Where will the U.S. and China be in the next century? How will Germany and India play a role? Give me your thoughts.
posted by Pascals Bookie @ 12:47 AM
8 Comments:
Well, there's a lot to discuss here (it sounds like your parents are interesting people, by the way; you did well to choose them). Where to start?
I think I'll start with the origins of U.S. economic power. You say "I countered that U.S. power never really came from working the hardest, but from being founded by landed gentry (and thus having the best head-start of any nation in history)." With all due respect, I think you're wrong on this count.
In fact, the part of the U.S. that was founded by landed gentry (you know, the part that thought owning people was okay) was, on the whole, slower to develop a modern economy and modern political system.
As early as 1776, Adam Smith was presaging economic dominance for 'the colonies,' primarily because of the productivity of our labor. He noted that America's high wages were a direct and proportionate result of productivity increases in labor.
At the same time, he disparaged Britain's policy of "royal grants" to landed aristocracy, of the type seen in the American South and - most egregious in his view - in the British East India Company. He correctly concluded and predicted that Bengal's advantages in production, so apparent to all desirous eyes in the mid-1700s, would be destroyed by colonial meddling. Bangladesh is now one of the poorest countries on Earth, and likewise the American South still has regions of shocking poverty.
The regions of the U.S. with the highest wages have always been those regions without the advantages of agricultural concentration and a landed nobility. Look where the Industrial Revolution started!
That leads us to your second theme, namely Asian (and European) competition. In this regard, I urge you to read a book called Trust (Prometheus, back me up on this). Its main premise is that the type of society in a nation correlates to its economic prospects, and societies with higher degrees of 'trust' fare better.
The short version is that China is not ideally positioned to be an economic superpower without massive state 'encouragement,' of whatever type. I'll discuss this (and India) in my next comment, because I've clearly gone too long for one comment's space.
I didn't explain myself properly on the "landed gentry" tip, largely because I was trying to consolidate a lengthy post, but my point was that, slaves excepted, America was largely founded, settled, and immigrated by the wealthy members of other societies, built it's wealth from there, and then outlasted to become the last remaining superpower due largely to our ability to spend the most, making other economies dependent on the U.S. purchasing power. Israel, for all of it's problems, has enjoyed much the same benefits of being populated with those wealthy enough to make the move. Meanwhile countries like liberia, or the post-communism democracies, have not had the same head-start, and have suffered.
Clearly there are many factors to take into account, with the timing of the industrial revolution being the major stroke of luck, but despite all the calls of "bring us your poor," the poor couldn't usually afford to make the trip.
As a side note, every time I throw intentional mis-spellings or puns into my posts, somebody comes along and removes them. Who's doing is this?
I go through and correct formatting errors, only. I have no idea who's going through and correcting spelling errors. You might want to indicate intentional spelling—and whatever other—errors you include in your posts with quotes or italics, or something to make them stand out as intentional.
Remember, unless it's special, for some reason, it's just a mistake.
-=gc=-
I changed the title of your post from "Pwnership Society" to "Ownership Society," because I assumed it was a typo ("O" and "P" being right next to each other, and 'ownership' being the more logical choice). If you meant Pwnership, I apologize
I'm with Gaufridus on this one. Please make it clear what's intentional, so that we don't think it's a typo or whatever.
The "Pwnership" was most likely intantional. What P.B. is doing is using "Leet," or "l337" as it would be written in it's native syntax (this is still being debated amonst leet-speakers). As you might guess, the intentional misspelling came about because of "p" and "o"s proximity to each other.
In online gaming, when someone really bested another, they would type into the little message thingie after the game, "I owned you!" Well, as you can also guess, some people typed "pwned," and got called out on it. To admit a spelling error must make the win that much less meaningful, so they would say that they meant to do it. Thus, "Pwned" was born.
"l337" is related to the AIM/ICQ/IRC/MSN shorthand that is so popular amongst today's youth: "k, c U l8r," for example.
I believe that was the intention behind P.B.'s title. Correct me if I'm wrong.
By the way—this is probably getting somewhat off topic...
Okay, I'll put us back on-topic. Well, not on topic for the post, but for the comments.
Pascals, you say:
"...slaves excepted, America was largely founded, settled, and immigrated by the wealthy members of other societies... despite all the calls of 'bring us your poor,' the poor couldn't usually afford to make the trip. "
Until I am shown statistics that back this up, I am inclined to disagree strongly, if only because there exist literally millions of counter-examples: the Irish fleeing the famine, Chinese laborers, Slavic immigrants from Austria and Russia, Jews from Russia fleeing the pogroms... and that's a very partial list.
I know this is all slightly off your original topic - to which we will return eventually, I do have faith - but I think the creation of the U.S. industrial economy merits discussion. I don't think it was a 'stroke of luck,' any more than I think immigrants - who worked in coal mines, so they couldn't have been too wealthy - were all upper-crust. Please explain this in greater detail, because I want to be sure that is what you mean.
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