In my essay on 'Five Strategic Mistake' I sought to correct the intellectual failure in the Francis Fukuyama's thesis on 'The End of History'. I admire the thinking of Francis Fukuyama and consider him to be one of the most serious strategic thinkers in the world.
However, I pointed out a major and strategic flaw in his thinking. He discounted the issue of democracy in the developing world in his work on 'The End of History'. This was a serious intellectual and strategic failure. It weakened the West's victory on democracy because it stopped the thinking necessary to create democracy in every country of the world and how it was going to be done. Now events across the world has put this question firmly on the agenda.
I want to highlight why this is going to be one of the key issue in the world in this century. The battle for democracy has not been won in the world. The developing and emerging economies are facing the issues of how a democracy functions, what constitutes a democracy, how does democracy relate to monarchies (e.g. in the Middle East with its Emirates and Sheikhdoms), the relationship between democracy and religions and the relationship between democracy and economic growth.
In an era of the rise of China as a global economic power, it is necessary to get this issue right. In an era of the rise of Islamic fundamentalism and Islamist forces seeking to create more theocratic states and overthrow secular ones, it is important to get this issue right. In an era of a hunger for commodities, there is an important discussion about the role of democracy in Africa and in commodity-rich states. There are also issues about the functioning of democracies and the expectations of people in existing democracies. For example, the issue of corruption in India which is the world's largest democracy, has risen to the top of the agenda with the Ana Hazare issue. There are also major issues about how a democracy deals with terrorist threats. In India, there is an issue of the Maoist terrorist threat and the Kashmir insurgency. Can a democracy use brutal force to impose its will on a reluctant people or class of people? In the USA, the issue of Guantanmo Bay is a major issue of the attitude towards the liberty in a situation of dangerous terrorist threats and the need to take action to pre-empt these. In Europe, there is a major issue of the rise of extreme right wing forces using some libertarian and pro-liberty arguments against the forces of Islamic backwardness and fundamentalism and winning considerable electoral support. In South East Asia, Burma is still a military dictatorship and its military is in charge despite the freeing of Aung San Suu Kyi from house arrest. Pragmatism in relation to dictators/absolute monarchies is a major issue for many countries e.g. India and Burma is thought in this way, Brazil and Iran is thought in this way, Saudi Arabia and USA is thought in this way, Thailand and UK is thought in this way, Taliban and Pakistan is thought in this way, etc. There is a lot of complexity in the issue.
The challenge for the champions of democracy is to be clear in their strategies, tactics and political arguments.
The first clarity is the need to be clear that there is a requirement for democracy in all parts of the world.
The second clarity is to identify the main obstacles to democracy. This is about understanding the rationale for a lack of democracy. This is based on vested interests, but there are different types of vested interests. It is useful to re-visit the Western route to democracy. Progress in the West took centuries (the world has speeded up in a dramatic way, so the timetable for democracy is more compact) and the process of democracy is not a simple one. I believe that there has to be a strategy discussion about democracy and its range of constitutional arrangements. For instance, constitutional monarchies exist across Europe within a framework of real democracy and power bestowed through the electoral mandate in a pluralist system with free speech, free media and political freedoms. I believe that it is healthy to discuss a constitutional monarchy model in the Middle East. The Al Qaeda model of overthrowing the Saudi Royal family is not the only option. This is also an option across all the Emirates and Sheikhdoms of the Middle East. Equally, there can be a discussion about stability and democracy in China. There was a real element of the Chinese communist party following a Gorbachov type model of internal reform in the Tiananmen Square democracy battle and its brutal repression by elite squads, where Deng Xiao Ping was in two minds about it (according to some sources0 and very much some top leaders of the Chinese Communist Party supported it. The situation in china has moved on, but this can be part of the opening up the thinking of democracy in relation to China. This can be one element of the discussion about the possible process of a transition to democracy in China. Equally, the Chinese middle class do seek an expanding space for cultural freedom in the context of its economic and social power in a new China as well as its need to interact in the global arena. A real discussion on the progress for democracy and actual policy tactics in specific countries is vital to energise a global process of engagement on this question. Western policy makers are hampered by this element of the discussion too.
The third element is the need to identify the critical elements of a democracy. My catch-phrase is that democracy is the goal and the means. Elections are not a one-off event. Hitler was elected. and then abolished elections. The Bolsheviks took part in elections - and then abolished them when they lost. There are Islamic fundamentalists capable of winning elections, but they do not operate in a democratic way because democracy is not a political way of life to them. For instance, Hamas literally killed its opposition some of its Fatah elements by throwing people off rooftops to death to deter opposition. Freedom of speech has been curtailed by President Hugo Chavez by his attacks on opposition TV space. Democracy is not winning one election or many elections. Iranian President was elected (probably in highly rigged election according to the evidence), but he refused to allow freedom of protest and has recently started a major campaign of imprisoning opposition leaders and even slight critics as well as sentencing some of the them to death. Democracy has to be a political way of life. So it totally legitimate to criticise anti-democratic actions of dictators. This leads to the question of the health of existing democracies which do see democracy as a way of life as part of the permanent institutional arrangements where the people choose the leader and are free to speak out on all questions affecting society. Again, it is right to criticise short-comings in a democracy too. Equally, I believe there has to be clarity that existing democracies are superior to dictatorships of any type. Democracies have a right to defend themselves. It was right for democracies to fight against Hitler's conquest of Europe by resorting to armed action. So it is right for democracies to fight the forces of reactionary anti-democracy elements even by using armed force in order to defend themselves. I believe that terrorism does require special measures in order to defend democracy. Francis Fukuyama was right about the real victory for democracy in Eastern Europe. The world got transformed.
The challenge is to transform the developed world on the question of democracy across the Middle East, South and East Asia, across Africa and Latin America. The vast majority of the world's population live in these societies. The right of people to choose their rules and in a free way is a truly great right. It is a measure of the immense progress made in the world. This right is for everyone in the world. The people of the developing countries might be poor - but they are human beings and have inalienable human rights. Democracy is a very modern human right.
Saturday, 30 April 2011
Friday, 29 April 2011
Capitalism and Progress in 21st Century: Five Strategic Mistakes
Five Strategic Mistakes
Summary: Strategic mistakes by policy makers have created havoc and political disasters in the beginning of the 21st century. Five strategic mistakes are highlighted in this essay. These have had a global impact of enormous proportions on decisions. They can be corrected by a change in strategic thinking amongst policy makers.
I believe that progress and pluralism is inextricably linked in the 21st century.
As an expert in international political economy, I wanted to examine some of the assumptions being made by policy thinkers about strategic quesions in the modern world.
In this article, I seek to highlight five strategic mistakes made by politicy experts about the 21st century. Although, it is tempting to say these are the mistakes of the neo-Conservatives, but I will not say this because I do not dismiss all the thinking of the neo-Conservatives and I do not believe the five strategic mistakes are confined to them at all.
Strategic Mistake One
1. Has the battle for democracy been won? Is it really 'The End of History'.
Progress in a political system is found in a pluralist democracy. The biggest event in this respect was the defeat of communist dictatorship in Eastern Europe and Soviet Union in 1989 and 1991. During the Second World War, Nazi and fascist dictatorship was defeated across Europe as well as their Japanese military allies in the East. Democracy triumphed twice in decisive ways.
Francis Fukuyama, the international political economy expert, described this as ‘End of History’ (in the famous book of the title) stating that liberal democracy had triumphed on a global stage. However, this made an assumption that democracy in developed or Western countries was the only democracy that mattered. This was a strategically mistaken characterization. Democracy only triumphed in the West and developed countries.
Ironically, communist dictatorship also survived in China, North Korea and a few other places. The mistake was not to take seriously the blow to democracy in the defeat of the Tiananmen Square Democracy Movement of China – in a very close run thing, I would argue with top Chinese leaders equivocal about it and the hardliners finally winning the argument for dictatorship through using military crackdown against peaceful protesters. Equally, the threat of ‘Islamic fascism’ was also a real. This is the form of third world religious dictatorship in the name of a religious, which is far removed from progressive or renaissance pluralist Islam with scientific ideas and ideas of multi-faith/secular states. Third world dictatorships were still alive across the world (e.g. Burma, Zimbabwe, Iran, Venezuela, Hamas regime in Gaza, etc). Today, these dictatorships use the rhetoric of ‘anti-imperialism’ as a way to obtain support across the world including in the Western left/liberal circles. However, the main attack by these dictatorships is on democracy in the West and specifically democracy in developing and emerging economies. There is a very serious battle going on in the world. Anti-imperialism is used to sap away the support from democracy. The battle has not been won. It is being fought.
Terrorism is also a modern form of attack on democracy in the West.
So democracy has not won its final battle. To believe this is a false sense of triumphalism. It belittles the challenges faced by democrats across the world specifically in the developing and emerging world.
Strategic Mistake Two
2. Clash of Civilisations and Racism– Is it reactionary?
The second major strategic mistake in international political economy has been to back authoritarian religious movements in the name of democracy. The whole ‘clash of civilisations’ thesis and neoconservative policy was a strategic blunder. The Christian right sought to attack other cultures and religions and undermine the progressive movement in the West. It also sought to mobilize the most right wing elements of Christian mass movement into an anti-progressive movement across the world. The only really progressive movement in the modern world is one based on pluralism: it’s known as ‘multi-cultural’, ‘multi-faith’ and ‘secular’ society and states. In Europe, ‘the clash of civilisations’ took on the form of a neo-racist and neo-fascist movements – with the most prominent political crisis caused by the Presidential run-off in France with the National Front leader Le Pen. The degradation and regression of democracy through such a sectarian political position has weakened the cause of liberal democracy. Champions of progress need to reclaim this ground away from the populist, governmental and mass movement ‘clash of civilisation’/racist supporters and reclaim a strongly pluralist democracy at a political and cultural/faith/secular level. Freedom of the individual and freedom of the minority/oppressed groups is at the heart of a modern democracy. This principle has to be fought for in the West as well as in the East, North and South.
Cultural pluralism is a very positive development in the world. It is enriching in terms of cultural renaissance in the world. It empowers people across different continents, whose ancestors have been subject to Western imperialism. Cultural uniformity hides a racist agenda. It is also not sustainable in terms of real global trends such as the development of emerging and developing economies.
The notion of the Rainbow Coalition is an attempt to create a movement based on progress (i.e. freedom of the individual and freedom of the minority/oppressed groups) and pluralism (cultural pluralism, multi-faith and multi-cultural/ secular society and state). It seeks to route out intolerance based on genuine cultural differences and different beliefs without seeking to divide humanity or endorse reactionary views.
Dynamic cultural fusions and mixes are part of a creative and rich world at ease with difference. The different dimensions and experiential perspectives and histories of humanity are not negated. They are affirmed within the framework of the recognition of the universality of humanity with equal human rights. They acknowledge the progressive traditions of different societies. Technology and science is acknowledged to be a global inheritance across different societies.
The monopoly of the West and Christianity over the notion of civilization, progressive, scientific and humanist tradition is ended. A new phase of history is opened up whereby all human contribution across different parts of the world is recognized as precious and celebrated in a very positive and public way. There is an equality of worth given to human beings across the planet as individuals and groups.
Strategic Mistake Three
3. Modern Capitalism and the Modern State in late 20th and early 21st century.
Equally, I believe that a strategic mistake has been made on the relationship between capitalism and the modern state. Capitalism has triumphed across the world as an economic system based on the role of the market as the dynamic element in economic progress. The evidence on this is overwhelming. Soviet Union and East Europe gave up state communist economics, but so did China. One of the reasons for the success of China has been its wholesale adoption of the capitalist market system in the management of the economy. Instead of fighting a cold war on the economic front, it created an alliance with Western capitalism through a complex system of Foreign Direct Investment (FDI), etc. Russia still has a cold war mindset on economic relations with Western companies, apart from its own failures to create adequate institutional arrangements for the legal functioning of capitalism in a fair way. North Korea is the only major state communist state reliant on military exports and denial of terrible hardships (e.g. mass famines) faced by its own people.
State socialist economics also suffered a major setback across the world. Nationalisation of industries has been discredited and state control of the economy to engineer self-sufficiency has shown to have failed. In the UK, this policy was abandoned by Labour (right and Blairite) and attacked by the Conservatives through a wave of privatization under Margaret Thatcher. In other places, it was abandoned in different political circumstances. In 1991, India abandoned this policy faced with humiliation of its economic failure – and adopted both increasing liberal internal market and free trade policies. There is a broad consensus on this (despite some emergency nationalization of the banks during the period of the recession).
However, there has been a critical debate on the merits of ‘Anglo-Saxon Capitalism’ (USA/UK) and European continental capitalism. I do not dismiss the arguments and I do not have some reactive positions. However, my starting point is not small state (although efficient expenditure practices and prudent use of tax policy should be ruthless pursued). My starting point is that the capitalist state has triumphed because of the success of its welfare and institutional legal frameworks. As I argue in one of my previous articles, there was a cross-party consensus during the most dynamic period of UK capitalism (the Industrial Revolution) that social and democratic reforms were part and parcel of a free market and free trade economy: Disraeli (Conservative) and Gladstone (Liberal) both supported very high levels of activity to civilize capitalism. In the US, there has been many phases of capitalist development. The late 19th century saw very tough controls on abuse such as the Sherman Anti-Trust measures of 1890. Germany during Bismarck introduced huge levels of insurance. All these measures showed that classical liberal capitalism was made civilized for the population and the worst features (callous) of the free market were eliminated prior to the arrival of the State Communist economics or State Socialism economics. There is a very rich tradition of Western capitalism seeking to introduce human progress measures to improve the full lives of people through the democratic state.
Strategic Mistake Four
4. Free Market Economics –The Human Progress Mission of Capitalism
‘Economics’ by The Economist magazine, the champion of free market economics in Europe, states that classical liberal free markets economics does not preclude different active welfare policies as well as active state interventions. I believe “a callous capitalism” arose in the West, through a series of confused policy thinking, based on trying to address real issues of the failures left behind by state communist and state socialist economics. The level of strategic misdirection caused by this trajectory of some bits of neoconservative economics has been extremely damaging to thinking about 21st century economics.
Economics is the servant of society and not its master. As a servant of society, economics has to deliver human progress through its economic policies and strategies. During the recent recession in the UK – monetary and Keynesian instruments were used - to mitigate the damages of the contagion, protecting people for a transitional period, proving loans to businesses, helping homeowners, stopping people losing their homes, seeking to develop new economic projects including pumping in some money for infrastructure, etc. Human progress requires helping people in trouble. So this exercise was well worth it.
The green critique of the damage to natural resources by specific types of over-use and danger its poses to the planet and humanity is very positive. Its solutions are based on notions of equity and lower consumption models in developing countries. Capitalism must be based on science and strategoc thinking rather than just short-terms trends. The future of the planet is of interest to all those who inhabit the planet.
However, my view is that neoconservative economic models are ‘callous’ and not effective. They will give capitalism a bad name and not produce dynamic economies. They identify some good things in society to protect people suffering hardship and want to attack them.
I believe that the basic model of free markets has to be based on the state protecting human progress in society. I also believe that the state has some role in providing a basic infrastructure for a modern society. This is an enabling and active role for the state. For instance, France has been good at building great railways through the state. It also managed to develop a very substantial energy infrastructure. These are the duties of the modern state.
The democratic state has the right to stop abuses by capitalism to defend the consumers, shareholders, state funds and to save capitalism from its own failures. There has to be a debate based on evidence and it may be that short-term selling has to heavily regulated (e.g. stop hedge funds try to destroy economies in order to purely enrich themselves by adopting anti-competitive behaviour). Modern capitalism must feel the pain of the people as responsible corporate members of society. They can be part of the solutions. However, callous capitalism has to be stopped by the state.
Strategic Mistake Five
5. Global Multi-Cultural Capitalism Today
Finally, modern day capitalism has become global capitalism. This has made a breakthrough for the developed/emerging economies in the world economy. Although even now, the world economy is still heavily based on the West (US and EU transactions are huge), there is a really powerful new set of world economies emerging. I have met so much denial of this reality of a plurality of global economic centres in the world economy amongst high level public policy makers, I worry that they will make another set of strategic blunders and take us down another blind ally.
The most powerful emerging economies, China and India, survived the recession with strong positive growth rates. China and some Middle East states are global holders of vast surplus funds and sovereign funds. Latin America and Africa also have strong emerging states.
This is multi-cultural global capitalism. A new set of alliances are needed at a global arena and a new set of complex principles are needed to engage with trade with dictators such as China – respecting their cultural difference and right to develop for its billions of people – but not respecting its dictatorship or its attempt to bully the world (e.g. its Asian neighbours).
I am glad that Forbes has shown that ‘multi-cultural capitalism’ exists on a global scale with dollar billionaires from all part of the world – with most new ones from Asian and emerging economies. This is an opportunity to reaffirm that ‘multi-cultural global society’ we live in.
When billions of people are escaping poverty (specifically in emerging economies), I expect the whole world to celebrate. The world economy has a new layer being added to it. With all it challenges, it does represent progress for humanity. Equally, there is a ‘multi-cultural poor people of the world’ with half the world living on less than $2 per day.
The conscience of capitalism should always be active. Progress must be sought everywhere. Our world is so far from perfect. We must draw in several billion into the world economy. Only when we have reached that goal and we have established pluralism in all corners of the world, can we say that there is an end to normal history of scarcity and an end to human repression. We can then use the term, ‘End of History’, without any hesitation.
Copyright Atma Singh 2010
I believe that progress and pluralism is inextricably linked in the 21st century.
As an expert in international political economy, I wanted to examine some of the assumptions being made by policy thinkers about strategic quesions in the modern world.
In this article, I seek to highlight five strategic mistakes made by politicy experts about the 21st century. Although, it is tempting to say these are the mistakes of the neo-Conservatives, but I will not say this because I do not dismiss all the thinking of the neo-Conservatives and I do not believe the five strategic mistakes are confined to them at all.
Strategic Mistake One
1. Has the battle for democracy been won? Is it really 'The End of History'.
Progress in a political system is found in a pluralist democracy. The biggest event in this respect was the defeat of communist dictatorship in Eastern Europe and Soviet Union in 1989 and 1991. During the Second World War, Nazi and fascist dictatorship was defeated across Europe as well as their Japanese military allies in the East. Democracy triumphed twice in decisive ways.
Francis Fukuyama, the international political economy expert, described this as ‘End of History’ (in the famous book of the title) stating that liberal democracy had triumphed on a global stage. However, this made an assumption that democracy in developed or Western countries was the only democracy that mattered. This was a strategically mistaken characterization. Democracy only triumphed in the West and developed countries.
Ironically, communist dictatorship also survived in China, North Korea and a few other places. The mistake was not to take seriously the blow to democracy in the defeat of the Tiananmen Square Democracy Movement of China – in a very close run thing, I would argue with top Chinese leaders equivocal about it and the hardliners finally winning the argument for dictatorship through using military crackdown against peaceful protesters. Equally, the threat of ‘Islamic fascism’ was also a real. This is the form of third world religious dictatorship in the name of a religious, which is far removed from progressive or renaissance pluralist Islam with scientific ideas and ideas of multi-faith/secular states. Third world dictatorships were still alive across the world (e.g. Burma, Zimbabwe, Iran, Venezuela, Hamas regime in Gaza, etc). Today, these dictatorships use the rhetoric of ‘anti-imperialism’ as a way to obtain support across the world including in the Western left/liberal circles. However, the main attack by these dictatorships is on democracy in the West and specifically democracy in developing and emerging economies. There is a very serious battle going on in the world. Anti-imperialism is used to sap away the support from democracy. The battle has not been won. It is being fought.
Terrorism is also a modern form of attack on democracy in the West.
So democracy has not won its final battle. To believe this is a false sense of triumphalism. It belittles the challenges faced by democrats across the world specifically in the developing and emerging world.
Strategic Mistake Two
2. Clash of Civilisations and Racism– Is it reactionary?
The second major strategic mistake in international political economy has been to back authoritarian religious movements in the name of democracy. The whole ‘clash of civilisations’ thesis and neoconservative policy was a strategic blunder. The Christian right sought to attack other cultures and religions and undermine the progressive movement in the West. It also sought to mobilize the most right wing elements of Christian mass movement into an anti-progressive movement across the world. The only really progressive movement in the modern world is one based on pluralism: it’s known as ‘multi-cultural’, ‘multi-faith’ and ‘secular’ society and states. In Europe, ‘the clash of civilisations’ took on the form of a neo-racist and neo-fascist movements – with the most prominent political crisis caused by the Presidential run-off in France with the National Front leader Le Pen. The degradation and regression of democracy through such a sectarian political position has weakened the cause of liberal democracy. Champions of progress need to reclaim this ground away from the populist, governmental and mass movement ‘clash of civilisation’/racist supporters and reclaim a strongly pluralist democracy at a political and cultural/faith/secular level. Freedom of the individual and freedom of the minority/oppressed groups is at the heart of a modern democracy. This principle has to be fought for in the West as well as in the East, North and South.
Cultural pluralism is a very positive development in the world. It is enriching in terms of cultural renaissance in the world. It empowers people across different continents, whose ancestors have been subject to Western imperialism. Cultural uniformity hides a racist agenda. It is also not sustainable in terms of real global trends such as the development of emerging and developing economies.
The notion of the Rainbow Coalition is an attempt to create a movement based on progress (i.e. freedom of the individual and freedom of the minority/oppressed groups) and pluralism (cultural pluralism, multi-faith and multi-cultural/ secular society and state). It seeks to route out intolerance based on genuine cultural differences and different beliefs without seeking to divide humanity or endorse reactionary views.
Dynamic cultural fusions and mixes are part of a creative and rich world at ease with difference. The different dimensions and experiential perspectives and histories of humanity are not negated. They are affirmed within the framework of the recognition of the universality of humanity with equal human rights. They acknowledge the progressive traditions of different societies. Technology and science is acknowledged to be a global inheritance across different societies.
The monopoly of the West and Christianity over the notion of civilization, progressive, scientific and humanist tradition is ended. A new phase of history is opened up whereby all human contribution across different parts of the world is recognized as precious and celebrated in a very positive and public way. There is an equality of worth given to human beings across the planet as individuals and groups.
Strategic Mistake Three
3. Modern Capitalism and the Modern State in late 20th and early 21st century.
Equally, I believe that a strategic mistake has been made on the relationship between capitalism and the modern state. Capitalism has triumphed across the world as an economic system based on the role of the market as the dynamic element in economic progress. The evidence on this is overwhelming. Soviet Union and East Europe gave up state communist economics, but so did China. One of the reasons for the success of China has been its wholesale adoption of the capitalist market system in the management of the economy. Instead of fighting a cold war on the economic front, it created an alliance with Western capitalism through a complex system of Foreign Direct Investment (FDI), etc. Russia still has a cold war mindset on economic relations with Western companies, apart from its own failures to create adequate institutional arrangements for the legal functioning of capitalism in a fair way. North Korea is the only major state communist state reliant on military exports and denial of terrible hardships (e.g. mass famines) faced by its own people.
State socialist economics also suffered a major setback across the world. Nationalisation of industries has been discredited and state control of the economy to engineer self-sufficiency has shown to have failed. In the UK, this policy was abandoned by Labour (right and Blairite) and attacked by the Conservatives through a wave of privatization under Margaret Thatcher. In other places, it was abandoned in different political circumstances. In 1991, India abandoned this policy faced with humiliation of its economic failure – and adopted both increasing liberal internal market and free trade policies. There is a broad consensus on this (despite some emergency nationalization of the banks during the period of the recession).
However, there has been a critical debate on the merits of ‘Anglo-Saxon Capitalism’ (USA/UK) and European continental capitalism. I do not dismiss the arguments and I do not have some reactive positions. However, my starting point is not small state (although efficient expenditure practices and prudent use of tax policy should be ruthless pursued). My starting point is that the capitalist state has triumphed because of the success of its welfare and institutional legal frameworks. As I argue in one of my previous articles, there was a cross-party consensus during the most dynamic period of UK capitalism (the Industrial Revolution) that social and democratic reforms were part and parcel of a free market and free trade economy: Disraeli (Conservative) and Gladstone (Liberal) both supported very high levels of activity to civilize capitalism. In the US, there has been many phases of capitalist development. The late 19th century saw very tough controls on abuse such as the Sherman Anti-Trust measures of 1890. Germany during Bismarck introduced huge levels of insurance. All these measures showed that classical liberal capitalism was made civilized for the population and the worst features (callous) of the free market were eliminated prior to the arrival of the State Communist economics or State Socialism economics. There is a very rich tradition of Western capitalism seeking to introduce human progress measures to improve the full lives of people through the democratic state.
Strategic Mistake Four
4. Free Market Economics –The Human Progress Mission of Capitalism
‘Economics’ by The Economist magazine, the champion of free market economics in Europe, states that classical liberal free markets economics does not preclude different active welfare policies as well as active state interventions. I believe “a callous capitalism” arose in the West, through a series of confused policy thinking, based on trying to address real issues of the failures left behind by state communist and state socialist economics. The level of strategic misdirection caused by this trajectory of some bits of neoconservative economics has been extremely damaging to thinking about 21st century economics.
Economics is the servant of society and not its master. As a servant of society, economics has to deliver human progress through its economic policies and strategies. During the recent recession in the UK – monetary and Keynesian instruments were used - to mitigate the damages of the contagion, protecting people for a transitional period, proving loans to businesses, helping homeowners, stopping people losing their homes, seeking to develop new economic projects including pumping in some money for infrastructure, etc. Human progress requires helping people in trouble. So this exercise was well worth it.
The green critique of the damage to natural resources by specific types of over-use and danger its poses to the planet and humanity is very positive. Its solutions are based on notions of equity and lower consumption models in developing countries. Capitalism must be based on science and strategoc thinking rather than just short-terms trends. The future of the planet is of interest to all those who inhabit the planet.
However, my view is that neoconservative economic models are ‘callous’ and not effective. They will give capitalism a bad name and not produce dynamic economies. They identify some good things in society to protect people suffering hardship and want to attack them.
I believe that the basic model of free markets has to be based on the state protecting human progress in society. I also believe that the state has some role in providing a basic infrastructure for a modern society. This is an enabling and active role for the state. For instance, France has been good at building great railways through the state. It also managed to develop a very substantial energy infrastructure. These are the duties of the modern state.
The democratic state has the right to stop abuses by capitalism to defend the consumers, shareholders, state funds and to save capitalism from its own failures. There has to be a debate based on evidence and it may be that short-term selling has to heavily regulated (e.g. stop hedge funds try to destroy economies in order to purely enrich themselves by adopting anti-competitive behaviour). Modern capitalism must feel the pain of the people as responsible corporate members of society. They can be part of the solutions. However, callous capitalism has to be stopped by the state.
Strategic Mistake Five
5. Global Multi-Cultural Capitalism Today
Finally, modern day capitalism has become global capitalism. This has made a breakthrough for the developed/emerging economies in the world economy. Although even now, the world economy is still heavily based on the West (US and EU transactions are huge), there is a really powerful new set of world economies emerging. I have met so much denial of this reality of a plurality of global economic centres in the world economy amongst high level public policy makers, I worry that they will make another set of strategic blunders and take us down another blind ally.
The most powerful emerging economies, China and India, survived the recession with strong positive growth rates. China and some Middle East states are global holders of vast surplus funds and sovereign funds. Latin America and Africa also have strong emerging states.
This is multi-cultural global capitalism. A new set of alliances are needed at a global arena and a new set of complex principles are needed to engage with trade with dictators such as China – respecting their cultural difference and right to develop for its billions of people – but not respecting its dictatorship or its attempt to bully the world (e.g. its Asian neighbours).
I am glad that Forbes has shown that ‘multi-cultural capitalism’ exists on a global scale with dollar billionaires from all part of the world – with most new ones from Asian and emerging economies. This is an opportunity to reaffirm that ‘multi-cultural global society’ we live in.
When billions of people are escaping poverty (specifically in emerging economies), I expect the whole world to celebrate. The world economy has a new layer being added to it. With all it challenges, it does represent progress for humanity. Equally, there is a ‘multi-cultural poor people of the world’ with half the world living on less than $2 per day.
The conscience of capitalism should always be active. Progress must be sought everywhere. Our world is so far from perfect. We must draw in several billion into the world economy. Only when we have reached that goal and we have established pluralism in all corners of the world, can we say that there is an end to normal history of scarcity and an end to human repression. We can then use the term, ‘End of History’, without any hesitation.
Copyright Atma Singh 2010
Tuesday, 26 April 2011
Middle East Capitalism and Revolution
The Middle East is witnessing a true revolution. There is a huge wave against the medieval structures of government in the Middle East - the absolute monarchies and the family of dictators.
The force that is propelling change is modern capitalism in the Middle East - driven by the huge prosperity of the oil commodity in a powerful global commodities market.
Oil is king ( to paraphrase 'the coal is king' phrase of the English Industrial Revolution) of the modern economic revolutions going on in the world (specifically the Asian economic revolution impacting on populations of several billion, but also the West and Japan).
The Middle east middle classes are becoming a force. The population of the Middle East are using Facebook and Twitter to organise the revolutions.
The true middle classes can create a democratic Middle East. However, the model of this can vary between constitutional monarchy model (which I think is a positive direction for many Middle Eastern countries through a process of managed change from the top meeting the aspirations of the population from below) and a new secular democracy with a genuine multi-party model specifically in 'democratic' (one party) states.
The dynamism of the Middle East middle classes can be under-estimated. Obviously, there is a real strain between the old order and the new aspirations. However, I saw the clear dynamic nature of the impact of globalisation in the Middle East - using Dubai as a role model of globalisation and its ability to create 'openness' in the Middle East to modern forces and modernisation. The more open attitude towards the West in Dubai is healthy. Equally, Dubai has relaxed its attitude towards Eastern religions (e.g. Sikhism, Buddhism, Hinduism, etc.).
The essential ingredient in the modernisation of the Dubai was the development of it as a global entertainment and leisure centre. This could not happen without accommodating the modernising forces of globalisation. It is iron - but the religious extremists attack the entertainment and leisure markets (as forces of corruption). I see the entertainment and leisure industries as forces of freedom and the creative impulse. As I stated earlier on this blog, I believe the primary motor force of capitalism is the creative impulse (and not the profit motive, which is a very powerful secondary force). So this is what creates freedom in capitalism and what enables the creative side to have space.
Dubai has been one of the great success story of Middle East capitalism and globalisation. I believe that democracy has to be combined with freedom for the creative impulse and political freedoms. Dubai may be able to adopt a managed process of the constitutional monarchy model. I believe that this model is possible in the Emirates and the Sheikhdoms.
Capitalism means freedom. The winds of change are blowing across the Middle East. They are wonderful winds - creating protection against the harshness of the old medieval order. They are winds of change that can sweep aside the 'Islamic fundamentalist' reactionary forces. I am always hopeful. I clearly side with the forces of progressive capitalism in the Middle East. I think there is a need for an urgent debate to head off a disaster in terms of Western policy on the Middle East.
However, this process requires boldness with its risk too. My view is that the risk for Middle East instability and the threat of the 'Islamic fundamentalism' is severe. It is better to anticipate this force and seek to head it off through the adoption of political reform. For instance, the Muslim Brotherhood of Egypt poses a severe risk to taking the Middle East backwards (with its politics similar to those of Hamas and Iran). Equally, the republican states in the Middle East have to create democratic pluralism with political and media freedom. The lack of freedoms allows the 'Islamic fundamentalism' to grow stronger. It is better to take the bold steps for reform rather than allow the anti-Western and anti-globalisation forces to take over.
I believe there is another central issue to the question of reform. To defeat the 'Islamic fundamentalism', it is essential to address the issue of the rights of women in the Middle East. I believe all the globalisation forces can adopt better positions than the reactionary forces of 'Islamic fundamentalism' on this issue. This means opening up the labour market to women, opening up the social space to women (especially the entertainment and leisure industries), enabling women to have equality in the political space, opening up the education sector to women and also women to decide how to dress in public. This is a revolutionary proposal for some Middle Eastern countries especially the Sheikhdoms and Emirates, however in many of the republican countries - this proposal is building on the existing progressive stance of 'Arab nationalism' on this question.
There has to be progress on the Israeli-Palestinian issue. The right of Israel to exist is used as an excuse by the 'Islamic fundamentalist' forces. Hamas - as a wing of the Muslim brotherhood - deliberately sabotaged the land for peace deal between Israel and the Palestinian National Authority. This has created a disaster for the Palestinian population of Gaza (which Israel left as part of the deal) and a crisis for the West Bank (less so than Gaza in terms of economic and political and human rights misery including for women) - as well as a retraction by Israel of the land for peace deal by it losing faith in the strategy. It is important that Israel is recognised as a state across the Middle East. This issue has to be addressed urgently. There should be only be a tiny minority backing Hamas as a force in the Middle East (even in Iran there must be pressure on this issue against the current anti-democratic regime with its attacks on the 'Green Revolution').
I have a vision of a peaceful, pluralistic and modern Middle East. I believe that opportunities are created for this Middle East by the current developments in the Middle East. This battle is by no means won - and serious dangers of the extremists exists. However, i believe that urgent reform can take the wind out of the extremists and enable even bigger economic development to take place in the Middle East - by a new openness to modernisation, globalisation. women's equality, embrace of Israel as a legitimate state within the Middle East and a pro-Western and pro-Eastern stance.
The Middle East can be a success story of the globalisation of the 21st century at an economic, political, social and cultural level for the benefit of the women and men of the region.
The force that is propelling change is modern capitalism in the Middle East - driven by the huge prosperity of the oil commodity in a powerful global commodities market.
Oil is king ( to paraphrase 'the coal is king' phrase of the English Industrial Revolution) of the modern economic revolutions going on in the world (specifically the Asian economic revolution impacting on populations of several billion, but also the West and Japan).
The Middle east middle classes are becoming a force. The population of the Middle East are using Facebook and Twitter to organise the revolutions.
The true middle classes can create a democratic Middle East. However, the model of this can vary between constitutional monarchy model (which I think is a positive direction for many Middle Eastern countries through a process of managed change from the top meeting the aspirations of the population from below) and a new secular democracy with a genuine multi-party model specifically in 'democratic' (one party) states.
The dynamism of the Middle East middle classes can be under-estimated. Obviously, there is a real strain between the old order and the new aspirations. However, I saw the clear dynamic nature of the impact of globalisation in the Middle East - using Dubai as a role model of globalisation and its ability to create 'openness' in the Middle East to modern forces and modernisation. The more open attitude towards the West in Dubai is healthy. Equally, Dubai has relaxed its attitude towards Eastern religions (e.g. Sikhism, Buddhism, Hinduism, etc.).
The essential ingredient in the modernisation of the Dubai was the development of it as a global entertainment and leisure centre. This could not happen without accommodating the modernising forces of globalisation. It is iron - but the religious extremists attack the entertainment and leisure markets (as forces of corruption). I see the entertainment and leisure industries as forces of freedom and the creative impulse. As I stated earlier on this blog, I believe the primary motor force of capitalism is the creative impulse (and not the profit motive, which is a very powerful secondary force). So this is what creates freedom in capitalism and what enables the creative side to have space.
Dubai has been one of the great success story of Middle East capitalism and globalisation. I believe that democracy has to be combined with freedom for the creative impulse and political freedoms. Dubai may be able to adopt a managed process of the constitutional monarchy model. I believe that this model is possible in the Emirates and the Sheikhdoms.
Capitalism means freedom. The winds of change are blowing across the Middle East. They are wonderful winds - creating protection against the harshness of the old medieval order. They are winds of change that can sweep aside the 'Islamic fundamentalist' reactionary forces. I am always hopeful. I clearly side with the forces of progressive capitalism in the Middle East. I think there is a need for an urgent debate to head off a disaster in terms of Western policy on the Middle East.
However, this process requires boldness with its risk too. My view is that the risk for Middle East instability and the threat of the 'Islamic fundamentalism' is severe. It is better to anticipate this force and seek to head it off through the adoption of political reform. For instance, the Muslim Brotherhood of Egypt poses a severe risk to taking the Middle East backwards (with its politics similar to those of Hamas and Iran). Equally, the republican states in the Middle East have to create democratic pluralism with political and media freedom. The lack of freedoms allows the 'Islamic fundamentalism' to grow stronger. It is better to take the bold steps for reform rather than allow the anti-Western and anti-globalisation forces to take over.
I believe there is another central issue to the question of reform. To defeat the 'Islamic fundamentalism', it is essential to address the issue of the rights of women in the Middle East. I believe all the globalisation forces can adopt better positions than the reactionary forces of 'Islamic fundamentalism' on this issue. This means opening up the labour market to women, opening up the social space to women (especially the entertainment and leisure industries), enabling women to have equality in the political space, opening up the education sector to women and also women to decide how to dress in public. This is a revolutionary proposal for some Middle Eastern countries especially the Sheikhdoms and Emirates, however in many of the republican countries - this proposal is building on the existing progressive stance of 'Arab nationalism' on this question.
There has to be progress on the Israeli-Palestinian issue. The right of Israel to exist is used as an excuse by the 'Islamic fundamentalist' forces. Hamas - as a wing of the Muslim brotherhood - deliberately sabotaged the land for peace deal between Israel and the Palestinian National Authority. This has created a disaster for the Palestinian population of Gaza (which Israel left as part of the deal) and a crisis for the West Bank (less so than Gaza in terms of economic and political and human rights misery including for women) - as well as a retraction by Israel of the land for peace deal by it losing faith in the strategy. It is important that Israel is recognised as a state across the Middle East. This issue has to be addressed urgently. There should be only be a tiny minority backing Hamas as a force in the Middle East (even in Iran there must be pressure on this issue against the current anti-democratic regime with its attacks on the 'Green Revolution').
I have a vision of a peaceful, pluralistic and modern Middle East. I believe that opportunities are created for this Middle East by the current developments in the Middle East. This battle is by no means won - and serious dangers of the extremists exists. However, i believe that urgent reform can take the wind out of the extremists and enable even bigger economic development to take place in the Middle East - by a new openness to modernisation, globalisation. women's equality, embrace of Israel as a legitimate state within the Middle East and a pro-Western and pro-Eastern stance.
The Middle East can be a success story of the globalisation of the 21st century at an economic, political, social and cultural level for the benefit of the women and men of the region.
Wednesday, 20 April 2011
The motive force of capitalism is progress, not profit
I believe the motive force for capitalism is not profit.
Philosophically, the motive force for capitalism is progress (in my opinion) and specifically the creative impulse.
Profit is powerful motivator, no doubt, but it is a secondary one.
The whole strategic and philosophical error in thinking about capitalism has arisen from this point.
Capitalism is a creative process:
Progress is at the heart of capitalism.
That is why it has succeeded against Marxism - despite the onslaught from its rhetoric and totalitarian materialist thinking focused on narrow money considerations. A partial philosophy has come unstuck against the drivers of history.
A new strategic analysis factoring in progress and the creative impulse is needed to revive capitalism in the West and bring out its best.
It is also a tool for understanding the capitalist take-offs in different countries (so-called emerging economies) including the developing world. The urgent need for progress is felt in these countries and the creative impulse is very powerful. The profit motive plays a secondary powerful motive force too.
Philosophically, the motive force for capitalism is progress (in my opinion) and specifically the creative impulse.
Profit is powerful motivator, no doubt, but it is a secondary one.
The whole strategic and philosophical error in thinking about capitalism has arisen from this point.
Capitalism is a creative process:
- It is about being productive and innovative.
- It is about the human genius and the world of ideas.
- out being productive and innovative.
- It is about modernisation.
- It is about social and ethical progress.
- It is about science and technology too.
- It is about the creativity of the employee, manager and employer.
- It is about women and men bringing similarities and differences to the workplace and the marketplace.
- It is about the global vision and the planet.
- It is about diversity of the human race.
- It is about meeting the consumer needs.
- It is about the individual.
- It is about progress in cultural expression too.
- It is about creative arts and entertainment too.
- It is about communications.
- It is about modernising religion.
- It is about caring.
- It is about welfare systems provided by the public good through collective forms of wealth-sharing (e.g. taxation).
- It is about infrastructure.
Progress is at the heart of capitalism.
That is why it has succeeded against Marxism - despite the onslaught from its rhetoric and totalitarian materialist thinking focused on narrow money considerations. A partial philosophy has come unstuck against the drivers of history.
A new strategic analysis factoring in progress and the creative impulse is needed to revive capitalism in the West and bring out its best.
It is also a tool for understanding the capitalist take-offs in different countries (so-called emerging economies) including the developing world. The urgent need for progress is felt in these countries and the creative impulse is very powerful. The profit motive plays a secondary powerful motive force too.
Tuesday, 19 April 2011
China and Capitalism
China adopted capitalist policies and embraced capitalism especially the United States capitalist investment.
So the myth that China started growing because of its communism and left-wing politics is false.
Equally, communism is not progressive because it is not democratic or free. This is a much more serious problem than many people admit.
Many people have been silenced on this question for they look to Chinese capitalism to be their benefactor. This is a strategic mistake.
Left wing advocates of the Chinese model put on blinds seeking to pretend that Chinese capitalism is Chinese state planning. Chinese capitalism is based on ditching Chinese state 'socialist' planning and substituting a very free market model of capitalism in its place.
I would argue that capitalist take-off is always a very raw process. This is forgotten in the West because Western capitalist is in a very advanced stage of development. The raw stage of West European capitalism happened in the early 19th century and in the USA in the late 19th century. So there is a romantic rosy view of Western capitalism and re-writing of history by right and left ideologists.
Chinese capitalism is capitalism at its most dynamic by lifting all restrictions on capitalist accumulation (specifically through a policy of external investment and free markets at its most blatant through special 'free trade zones' - with its acronym. SEZ -Special Economic Zones). This process unleashed China for economic take-off. It unleashed capitalism in China. Capitalism is a dynamic entity. China's capitalist take-off is one of the most spectacular events in world history, but it is poorly understood. There has been harshness at this stage of Chinese capitalist development - and progressive politics means seeking to put this right.
So Chinese communism is a problem, whereas Chinese capitalism is a success for the world.
Chinese communism is not progressive. At its most basic level, the people are not free to express their grievances. The lack of free speech and democracy has resulted in major injustices in China.
The people have been silenced in the name of Chinese nationalism and by communists turning into capitalists of the worst sort. The first law of capitalism is private property rights. This law protects the poor, but in China the myth of people owning property collectively has been used to deny people any compensation for their land being seized. The Chinese 'Communist-Capitalists' are guilty of this sin. They have robbed poor and helpless people of their lands - all through legal fiction. So change is needed to protect the ordinary people of China and this is part of progressive capitalism - the law is used to protect the people without seeking to stop capitalism as a dynamic system.
So the Chinese model is not the answer. However Chinese capitalism is dynamic now - as English capitalism was during the English Industrial Revolution or USA capitalism was during its rise in the late 19th century. 'Cowboy Capitalism' is my nickname for it. However, English and USA capitalism had created a fierce tradition of free speech that resulted in democracy and progressive capitalism. China does not have this. It is one of the greatest and most difficult challenges for the Chinese and all progressives in the world.
So the myth that China started growing because of its communism and left-wing politics is false.
Equally, communism is not progressive because it is not democratic or free. This is a much more serious problem than many people admit.
Many people have been silenced on this question for they look to Chinese capitalism to be their benefactor. This is a strategic mistake.
Left wing advocates of the Chinese model put on blinds seeking to pretend that Chinese capitalism is Chinese state planning. Chinese capitalism is based on ditching Chinese state 'socialist' planning and substituting a very free market model of capitalism in its place.
I would argue that capitalist take-off is always a very raw process. This is forgotten in the West because Western capitalist is in a very advanced stage of development. The raw stage of West European capitalism happened in the early 19th century and in the USA in the late 19th century. So there is a romantic rosy view of Western capitalism and re-writing of history by right and left ideologists.
Chinese capitalism is capitalism at its most dynamic by lifting all restrictions on capitalist accumulation (specifically through a policy of external investment and free markets at its most blatant through special 'free trade zones' - with its acronym. SEZ -Special Economic Zones). This process unleashed China for economic take-off. It unleashed capitalism in China. Capitalism is a dynamic entity. China's capitalist take-off is one of the most spectacular events in world history, but it is poorly understood. There has been harshness at this stage of Chinese capitalist development - and progressive politics means seeking to put this right.
So Chinese communism is a problem, whereas Chinese capitalism is a success for the world.
Chinese communism is not progressive. At its most basic level, the people are not free to express their grievances. The lack of free speech and democracy has resulted in major injustices in China.
The people have been silenced in the name of Chinese nationalism and by communists turning into capitalists of the worst sort. The first law of capitalism is private property rights. This law protects the poor, but in China the myth of people owning property collectively has been used to deny people any compensation for their land being seized. The Chinese 'Communist-Capitalists' are guilty of this sin. They have robbed poor and helpless people of their lands - all through legal fiction. So change is needed to protect the ordinary people of China and this is part of progressive capitalism - the law is used to protect the people without seeking to stop capitalism as a dynamic system.
So the Chinese model is not the answer. However Chinese capitalism is dynamic now - as English capitalism was during the English Industrial Revolution or USA capitalism was during its rise in the late 19th century. 'Cowboy Capitalism' is my nickname for it. However, English and USA capitalism had created a fierce tradition of free speech that resulted in democracy and progressive capitalism. China does not have this. It is one of the greatest and most difficult challenges for the Chinese and all progressives in the world.
Progress matters. Capitalism matters.
I want to show how capitalism is closely related to progress. So I dispute the position of the right that progress is alien to capitalism and I dispute the position of the left that capitalism does not create progress.
I have termed my political thinking and political philosophy, 'Progressive Capitalism'. Ethical globalisation or capitalism with a human face can also be used to describe my political philosophy and political thinking.
My thinking and philosophy rests on two concepts:
I want to exchange ideas as well as advocate a fresh look at capitalism and a fresh look at progress in the 21st century. My field is global political economy. I have moved from an extreme left position to become a fan of capitalism. I have ditched the extreme left concept that progress is relative and that capitalism cannot be progressive. I have started thinking for myself and started on the journey of my own creative ideas and exploration into this subject.
This blog seeks to generate discussion. All genuine discussion will be welcome.
I have termed my political thinking and political philosophy, 'Progressive Capitalism'. Ethical globalisation or capitalism with a human face can also be used to describe my political philosophy and political thinking.
My thinking and philosophy rests on two concepts:
- 'Progressive' relates to progress at all levels and all types - and I am of the view that progress does mean something, even if in history there is no linear progress, but up and downs too;
- 'Capitalism' is not about free markets, but about capital and how it used for creative purposes and I want to discuss capitalist accumulation too and how modern capitalism arose - with progress at its heart, contrary to the myth that capitalism is harsh created by the socialist left and the pure free market advocates. I also want to show that capitalism as a model must be rescued in its progressive aspect and on a global level. This will lead to capitalism at its best and most dynamic and most progressive and efficient. I also believe that the critics of 'progressive capitalism' of the left and right seek to create a myth based on a specific episode in the take-off of capitalism (early phase of capitalist take-off with its very brutal social dislocation and its very unregulated and under-developed systems) and use it to perpetuate a myth of ideological politics for the left and the right. I believe that both these models are extremely damaging and result in poor strategic policy making at an international and national level.
I want to exchange ideas as well as advocate a fresh look at capitalism and a fresh look at progress in the 21st century. My field is global political economy. I have moved from an extreme left position to become a fan of capitalism. I have ditched the extreme left concept that progress is relative and that capitalism cannot be progressive. I have started thinking for myself and started on the journey of my own creative ideas and exploration into this subject.
This blog seeks to generate discussion. All genuine discussion will be welcome.
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