By training I’m a historian. But that was long ago. So I’ve got an interest in events and trends, economic as well as political. So here’s an amateur’s tour.
Britain became the dominant power because of iron and steel. It was first out of the starting blocks in the Industrial Revolution. The same economic powerhouse saw the North overwhelm (at great cost to both sides) the South in the American Civil War. Despite gallantry and bravery the South was beaten by rail and industry. It was a harbinger of things to develop.
Germany, and to an extent Japan, challenged that Anglo-Saxon economic supremacy. And failed. (Again at great cost to both sides) (And the economic analysis ignores the ideological aspects that led to the holocaust).
But China is now doing it by a different method. It is using the very industrial muscle that gave that supremacy its strength. Container ships sail to the American West Coast full. They return to China empty. Manufacturing languishes in the USA. Unemployment increases there. The Chinese standard of living improves (relatively). Unrest in the USA festers. Bread and circuses – shades of ancient Rome.
Like all Cook’s tours – suspect. But I consider it contains many atoms of truth.
It seems to me that America is New Zealand writ large – indeed the whole Western world. There are two economies – one is, and this is very crude, financial and big business. Profits on investments increase and top salaries are soaring. Banks are booming. With the best of intentions they were shored up during the recession.
But the rest of the economy and society wasn’t. For the ordinary worker wages are static, unemployment rises, people are scared of losing jobs and homes, small businesses are collapsing.
The big corporations have shifted their operations offshore. Overseas workers with less pay and harsher workplace conditions will produce the goods and services that once were delivered in the homeland. If I could get hold of the Filipino - I think he was - that I recently dealt on the phone with I hope there would be someone near to restrain me. And it wasn’t his fault. He could only work from the information he’d been trained to deliver.
Services! The IT revolution that was supposed to free us has replaced us with digital services. The obvious catch for our workers is lost income. The hidden catch for our economy is that the purchasing power of the people decreases. Market towns know this pattern – a drought season and the farmers stop buying all but necessities. West Coasters fear it – with good reason – after the Pike River disaster.
Both in America and here tax cuts increase the income and spending power of the rich. The majority, if not standing still, are going backwards because necessary expenditure increases. This has societal consequences. In both countries expenditure on pre-school and tertiary is being cut while the school sector is being squeezed.
It’s a topsy-turvy society we’re creating. The historian in me also recognises people power. The French, Chinese, Cuban people all rose up in anger about a two-tiered society. Looking at riots in Athens, London, Rome, Madrid and I’ll predict to come in the USA, I wonder if this unrest is not a harbinger of change waiting in the wings. America arose from revolt.
WORDS with Douglas McLennan
14 hours ago