18 February 2013
The Decline of the West?
By Gwynne Dyer
You know the story-line by now. There are one million US-dollar millionaires in China. (“To get rich is glorious,” said former leader Deng Xiao-ping.) Seventy percent of the homes in China are bought for cash. China’s total trade – the sum of imports and exports – is now bigger than that of the United States. “They’re going to eat our lunch,” whimper the faint-hearted in the West.
It’s not just the Chinese who are coming. The Indians and the Brazilians are coming too, with economic growth rates far higher than in the old industrialised countries, but it doesn’t even stop there. There’s also Mexico, Turkey, Indonesia and half a dozen other big countries in what used to be called the Third World that have discovered the secret of high-speed growth. The power shift is happening even faster than the pundits predicted.
As recently as 2009, the “Brics” (Brazil, Russia, India and China) accounted for less than one-tenth of total global consumption. The European Union consumed twice as much, and so did the United States. But by 2020, the Brics will be producing and consuming just as much as either of the older economic zones, and by 2025 considerably more than either of them.
In fact, if you include not just the four Brics but all the other fast-growing economies of the ex-Third World, in just a dozen years’ time they will account for around 40 percent of world consumption. As a rule, with wealth comes power, so they will increasingly be calling the tune that the West must dance to. Or at least that is the Doomsday scenario that haunts the strategists and economists of the West. It’s nonsense, for at least three reasons.
First of all, a shift in the world’s centre of economic gravity does not necessarily spell doom for those whose relative influence has dwindled. The last time the centre shifted, when the United States overtook the nations of Europe in the late 19th and early 20th centuries, it did not dent Europe’s prosperity at all.
It’s true that by the latter half of the 20th century there were American troops all over Western Europe, but that would not have happened if Europe had not come close to destroying itself in the two world wars (which can be seen as a European civil war in two parts). In any case, the US troops have mostly gone home now, and Europeans live at least as well as Americans.
Secondly, the new centre of gravity this time, while mostly located in Asia, is not a single country with a coherent foreign policy like the United States. The four Brics will never become a strategic or economic bloc. They are more likely to split into rival blocs, although one hopes not. And the Mexicos and Turkeys and Indonesias of this new world will have their own fish to fry.
So it will be a more complicated world with many major players, and the centre of economic gravity will be in Asia, but there’s nothing particularly strange about this. More than half of the human race lives in Asia, so where else should the centre of gravity be? Asia is very far from monolithic, and there is no logical reason to suppose that its economic rise spells economic decline for the West.
Thirdly, descriptions of the future that are simply extrapolations of the present, like the ones at the start of this article, are almost always wrong. If the widely believed forecasts of the 1980s had been right, Japan would now bestride the world like an economic Colossus. The one certain thing about the future is surprises – but some surprises are a little less surprising than others.
Take climate change, for example. The scientific evidence strongly suggests that the tropical and sub-tropical parts of the world, home to almost all of the emerging economic powers, will be much harder hit by global warming than the temperate parts of the globe, farther away from the equator, where the older industrialised countries all live.
There is already much anger about this in the new economic powers. Eighty percent of the greenhouse gases of human origin in the atmosphere were put there by the old-rich countries, who got rich by burning fossil fuels for the past two centuries, and yet they get off lightly while the (relatively) innocent suffer. But even if the newly rich wanted revenge, they are too disunited – and will be too busy coping with the warming – to do much about it.
The centre of gravity of the world economy is undoubtedly leaving the old “Atlantic” world of Europe and North America and moving towards Asia, but how far and how fast this process goes remains to be seen. And there is no reason to believe that it will leave the countries of the West poor or helpless.
True, economists in the West often ask the question: “what will we sell the emerging countries in the future that they cannot produce for themselves?” In the runaway global warming scenario, the answer would be “food”, but the real answer is sure to be more complex than that. Never mind. They’ll think of something, because they’ll have to.
To shorten to 725 words, omit paragraphs 6 and 11. (“It’s true…Americans”; and “There is…about it”)
22 December 2012
By Gwynne Dyer
To begin on a happy note, the world didn’t end this year. December 21st came and went without a sign of the Four Horsemen, leaving the Mayans (or rather their ancestors) with egg all over their faces. It just goes to show the perils of prediction – but why would we let that deter us? Nobody is keeping score.
So, instead of the usual trek through the events of the past year, why don’t we use this year-ender to examine the entrails of recent events for portents of the future? Like, for example, the vicissitudes of the Arab revolutions in the past twelve months.
On one hand, there were the first truly free elections in modern Egyptian history. On the other hand, judges inherited from the old regime dismissed the lower house of parliament on a flimsy pretext, and then the Islamist president retaliated by ramming through a new constitution that entrenched conservative “Islamic” values against the will of more than a third of the population. Is this glass half full or half empty?
On one hand, Libyans managed to hold a free election even though the country is still overrun by various militias, and Yemen finally bid farewell to its dictator of thirty-odd years. On the other hand, Syria has fallen into a full-scale civil war, with government planes bombing city centres and 40,000 dead. Did the “Arab spring” succeed, or did it fail?
Well, both, of course. How could it have been otherwise, in a world of fallible human beings? But the mould has been broken, and already half of the world’s Arabs live in countries that are basically democratic.
The political game is being played pretty roughly in some Arab countries, but that’s quite normal in new democracies – and in some older ones, too. In the years to come the transformation will deepen, amidst much further turbulence, and most Arab countries will emerge from it as normal, highly imperfect democracies. Just like most of the world’s other countries.
The European Union staggered through a year during which the common currency of the majority of its members, the euro, tottered permanently on the brink of collapse. The financial markets have been talking all year about “Grexit”, the expected, almost inevitable withdrawal of Greece from the eurozone, and speculating on which country would leave next.
They thought it would be Spain for most of the year, but Silvio Berlusconi’s decision to run for office again – “The Return of the Undead”, one European paper called it – switched the spotlight to Italy in November. The possibility that the common currency might simply fall apart, and take the political unity of the European Union with it, could no longer be dismissed.
Meanwhile, secessionist movements flourished in major EU states. In Spain, both Catalonia and the Basque region elected provincial governments committed to holding referendums on independence. The United Kingdom and the recently devolved Scottish government agreed on the terms of a referendum to be held on Scottish independence in 2014. And in Belgium, Flemish threats to secede seemed more plausible than usual.
It’s a mess, in other words, and Europe certainly faces years of very low economic growth. But the EU was always mainly a political project, intended to end centuries of devastating wars in Europe, and the euro was invented to reinforce that political union.
That project still has the firm support of the political elites in almost all EU countries, and they will pay whatever price is necessary to save it. Even in the regions considering secession from their current countries, there is no appetite for leaving the EU. Indeed, the strongest argument of the anti-secessionists is to say that those regions would have to re-apply for EU membership if they got their independence, rather than just inheriting it automatically.
So the European Union will survive, and will even recover its financial stability eventually. It will also remain a major economic player in the world, athough the centre of gravity of the global economy will continue to shift towards Asia. There is even reason to think that Asia’s triumph will arrive somewhat later, and in a rather more muted fashion, than the enthusiasts have been predicting in recent years.
In the last months of 2012 China went through the ten-yearly ritual in which power is handed on to a new generation of leaders, and both Japan and South Korea elected new right-wing governments. North Korea, the nuclear-armed rogue state that lies between them, put its first satellite into orbit, thus demonstrating its ability to build long-range ballistic missiles. And China was almost continuously embroiled in border disputes with its neighbours (Vietnam, the Philippines, Malaysia) in the South China Sea.
The cloud on the horizon is still “no bigger than a man’s hand,” but it is definitely there. We can hope that the world works differently nowadays, and in some ways it really does, but the fears, the nationalist passions, and even the strategic relationships in Asia are coming to resemble those in Europe a century ago, on the eve of the First World War.
Even if an equivalent war never actually happens in Asia, a growing share of the region’s resources may be wasted on military spending. And if there ever were a real war, the destruction would be so great, given current weapons technologies, that the region could lose several decades’ worth of growth. But it will be some years yet before we know if the region is really drifting in that direction.
The world’s drift towards global catastrophe due to climate change is becoming impossible to deny. This northern summer saw prolonged droughts and heat waves ravage crops from the US Midwest to the plains of Russia, and soaring food prices as the markets responded to shortages in food supply.
This September saw Arctic sea ice cover fall to its lowest ever level: only half of the total area covered by ice in September ten years ago. And October saw Hurricane Sandy devastate much of the US east coast, causing a hundred deaths and over $30 billion in damage. It was the second-costliest tropical storm in American history (after Katrina, in New Orleans, seven years ago).
Yet the global response is as feeble as ever. The annual round of global negotiations on cutting greenhouse gas emissions, held this December in Qatar, merely agreed that they would try to get some sort of deal by 2015. Even if they do, however, it won’t go into effect until 2020.
So for the next eight years the only legal constraint on warming will be the modest cuts in emissions agreed at Kyoto fifteen years ago. Moreover, those limits only apply to the old industrial powers. There are no limits whatever on the rise of emissions by the fast-growing economies of the emerging industrial powers in Asia, Africa and Latin America. Even lemmings usually act more wisely than this.
November brought a week of massive Israeli air and missile strikes against the Gaza Strip, allegedly in retaliation for Palestinian missile attacks against Israel, but the tit-for-tat has been going on for so long that it’s pointless to discuss who started it. And nothing Israel does can stop the growing support for a Palestinian state: in late November the United Nations General Assembly granted Palestine non-voting observer state status by a vote of 138-9.
More worrisome was the threat of Israeli air strikes on Iran, supposedly to stop it from getting nuclear weapons. That would be a very big war if it started: the United States would almost inevitably get dragged in, the flow of oil from the Gulf states would stop, and the world economy would do a nosedive.
But there is no proof that Iran is currently working on nuclear weapons (the US and Israeli intelligence services both say no), and mere air strikes would not cripple Iran’s nuclear industry for long. So the whole issue is probably an Israeli bluff.
A bluff to what end? To get the rest of the world to impose severe economic sanctions against Iran, in the hope that they will cause enough pain to get Iranians to overthrow the present regime. The damage is certainly being done – the value of the Iranian rial collapsed this year – but the power of the ayatollahs is unshaken. They will not be overthrown, and there will not be a war. I think.
And then there’s the United States, where Barack Obama, having accomplished little except health care reform in his first presidential term, was re-elected anyway. The Republican candidate concentrated his campaign on Obama’s slow progress in overcoming the deepest recession in seventy years (which had been caused by the previous Republican administration), but just in time the numbers started to turn upward for Obama.
The economic recovery will probably strengthen in the coming year (unless the United States falls off the “fiscal cliff” in the next week or so), and strong growth will give Obama enough political capital to undertake on at least one big reform project. The highest priority is obviously global warming, but there is a danger that he will fritter his resources away on hot-button issues like gun control.
So much for the big themes of the year. There was also the usual scatter of promising changes like Burma’s gradual return to democracy, the start of peace talks that may bring an end to the 60-year-old war between government and guerillas in Colombia, and the return to the rule of law in growing areas of anarchic Somalia.
Similarly, there was a steady drizzle of bad news: the revolt by Islamist extremists that tore the African state of Mali in half in April, the pogrom against Burmese Muslims in July, and the police massacre of striking miners in South Africa in August.
Venezuela’s President Hugo Chavez is probably dying of cancer, and the rules for choosing his successor are in dispute. Russia’s President Vladimir Putin faced unprecedented public protests after the elections last March, but his power still seems secure. The Mars rover landed successfully in August, and is now busily trundling across the Martian landscape. The existence of the Higgs boson was confirmed (or at least tentatively confirmed).
Business as usual, in other words. 2012 wasn’t a particularly bad year; if you think it was, you’ve been reading too many newspapers and watching too much CNN. Their stock-in-trade is crisis and tragedy, so you can always count on them to give you the worst news possible. It wasn’t all that great a year either, but never mind. There’ll be another one along shortly.
This article is 1750 words. To shorten it, you can omit any of the main themes except the first one (on events in the Arab world) — that is, paragraphs 7-12 (“The European…years”); paragraphs 13-15 (“In the last…direction”); paragraphs 16-19 (“The world’s…than this”); or paragraphs 21-23 (“More worrisome…I think”).
Various single paragraphs can also be dropped: nos. 4, 6, 8, and 28.
15 August 2012
The Rich, the Poor and the Hungry
By Gwynne Dyer
Two months ago, the United States Department of Agriculture forecast the biggest maize (corn) harvest in history: 376 million tonnes. After two months of record heat and drought in the US Midwest, it has dropped its forecast to 274 million tonnes. So by early July it was predicting that the price per bushel of maize would exceed $8 for the first time in history, and it’s now forecasting $8.90.
The heat wave in Russia, while nowhere near as bad as the one in 2010, is also cutting deeply into Russian wheat production. There will still be enough for domestic consumption, but Andrei Sisov of the Moscow-based farming consultancy SovEcon said last week that he expected Russian wheat exports to drop from 28 million tonnes to only 13 million. For this and other weather-related reasons, wheat prices are on their way up too.
High wheat prices hit human consumers directly, but high maize prices hit even harder in the long run because huge amounts of maize are used to feed animals and provide oil for processed foods. World food prices in general are on the way back up, and it’s beginning to look like a pattern, not a series of accidents.
The last big price spike, in 2007-09, had a huge impact in developing countries, where many people spend around 40 percent of their income on food (compared with only about 10 percent in developed countries). If you’re already spending almost half your income on food and the price soars, you just have to give your children less food – which is why some people see the revolutions of the “Arab Spring” as delayed reactions to the last spike.
Meanwhile, on a different planet entirely, the McKinsey Global Institute, the business and research arm of management consultancy McKinsey & Company, published another report in June. It’s the latest in an endless series of ever-bolder estimates by various “global institutes” of how fast the demand for goods and services is growing around the world.
The themes of McKinsey’s new report, “Urban World: Cities and the Rise of the Consuming Class”, are familiar enough. The world’s economic centre of gravity is moving to Asia; huge numbers of new “consumers” – people with average annual incomes over $3,600 who buy more than just food and basic shelter – will be joining the global market by 2025; there are wonderful opportunities out there for clever investors.
The only new wrinkle in this document is the bit about how 65 percent of “global growth” to 2025 will happen in the “City 600″, as they call it: the world’s 600 biggest cities. And what McKinsey calls “the Emerging 440 cities” – those among the 600 that are in the rapidly developing countries – will account for almost half of the total growth in world demand to 2025.
Then come the numbers. As the emerging economies grow, they’ll all start buying fridges and baby food and, eventually, cars. Whoopee! We’ll all get rich selling things to the Chinese!
But nowhere in the report does McKinsey deal seriously with the impact of a predicted total of 2.6 billion consumers, up from only 0.8 billion now, on world demand for food. Yet meat consumption soars as incomes rise. Feeding animals to produce meat puts huge pressure on grain resources, so all food prices rise, for rich and poor alike.
Combine the rise in meat consumption with an extra billion people and severe constraints of food production, most of them related to climate change, and world food prices in 2025 could be two to three times higher in real terms than they are now. That means that the poorest starve, and that a lot of McKinsey’s promised new “consumers” – those who can spend on other things than sheer survival – don’t make it into the middle class after all.
The same rationing by price is likely to apply to everything else that matters. Indeed, the prices of energy and raw materials, which fell consistently through most of the 20th century, are already back up to where they were in real terms a century ago. There are not going to be 1.8 billion new consumers in thirteen years’ time, and the poor will be more desperate than ever, and political stability in many developing countries will be just a memory.
The demands of consumers, like the sheer number of human beings, can in theory expand indefinitely, but on a finite planet with dwindling resources and a changing climate the cost of meeting consumer demand is going to go up very steeply. It is probably going to get very ugly out there.
And as for China, the poster child for miraculously fast economic growth – well, China has one-seventh as much water and one-tenth as much arable land per capita as North America. When things get tough, that is going to matter a lot.
To shorten to 725 words, omit paragraphs 4 and 7. “The last…spike”; and “The only…2025″
20 May 2012
The Triumph of English
By Gwynne Dyer
The second president of the United States, John Adams, predicted in 1780 that “English will be the most respectable language in the world and the most universally read and spoken in the next century, if not before the end of this one.” It is destined “in the next and succeeding centuries to be more generally the language of the world than Latin was in the last or French is in the present age.”
It was a bold prediction, for at that time there were only about 13 million English-speakers in the world, almost all of them living in Britain or on the eastern seaboard of North America. They were barely one percent of the world’s population, and almost nobody except the Welsh and the Irish bothered to learn English as a second language. So how is Adams’s prediction doing now?
Well, it took a little longer than he thought, but last week one of the most respected universities in Italy, the Politecnico di Milano, announced that from 2014 all of its courses would be taught in English.
There was a predictable wave of outrage all across the country, but the university’s rector, Giovanni Azzoni, simply replied: “We strongly believe our classes should be international classes, and the only way to have international classes is to use the English language. Universities are in a more competitive world. If you want to stay with the other global universities, you have no other choice.”
The university is not doing this to attract foreign students. It is doing it mainly for its own students who speak Italian as a first language, but must make their living in a global economy where the players come from everywhere – and they all speak English as a lingua franca.
Many other European universities, especially in Germany, the Low Countries and Scandinavia, have taken the same decision, and the phenomenon is now spreading to Asia. There is a huge shift underway, and it has become extremely rare to meet a scientific researcher or international businessperson who cannot speak fluent English. How else would Peruvians communicate with Chinese?
But wait a minute. Peruvians speak Spanish, the world’s second-biggest language, and Chinese has the largest number of native speakers of any language. Why don’t they just learn each other’s languages?
Because neither language is much use for talking to anybody else. Chinese won’t get you very far in Europe, Africa or the Americas – or, indeed, in most of Asia. The same goes for Spanish almost anywhere outside Latin America. Since few people have the time to learn more than one or two foreign languages, we need a single lingua franca that everybody can use with everybody else.
The choice has fallen on English not because it is more beautiful or more expressive, but just because it is already more widespread than any of the other potential candidates.
Mandarin Chinese has been the biggest language by number of speakers for at least the last thousand years, and is now used by close to a billion people, but it has never spread beyond China in any significant way. Spanish, like English, has grown explosively in the past two centuries: each now has over 400 million speakers. But Spanish remains essentially confined to Central and South America and Spain, while English is everywhere.
There is a major power that uses English in every continent except South America: the US in North America, the United Kingdom in Europe, South Africa in Africa, India in Asia, and of course Australia (where the entire continent speaks it). All of that is due to the British empire, which once ruled one-quarter of the world’s people. For the same reason, there are several dozen other countries where English is an official language.
Of course, the British empire went into a steep decline almost a century ago, but the superpower that took Britain’s place was the United States, another English-speaking country. After another century during which everybody dealing in international business and diplomacy – indeed, any independent traveler who went very far from home – simply had to learn English, the die was cast. English had become the first worldwide lingua franca.
There have been few languages in world history that were spoken by more people as a second language than as a first; English has had that distinction for several decades already. Never before has any language had more people learning it in a given year than it has native speakers; English has probably now broken that record as well.
Most of those learners will never become fully fluent in English, but over the years some hundreds of millions will, including the entire global elite. And the amount of effort that is being invested in learning English is so great that it virtually guarantees that this reality will persist for generations to come.
No other language is threatened by this predominance of English. Italians are not going to stop speaking Italian to one another, even if they have attended the Politecnico di Milano, and no force on Earth could stop the Chinese or the Arabs from speaking their own language among themselves. But they will all speak English to foreigners.
To shorten to 725 words, omit paragraphs 10 and 14 (“Mandarin…everywhere”; and “Most of…to come”)