Majorityrights Central > Category: Globalisation

Here is Martin Hutchinson’s latest at Prudent Bear, quietly informing bovine optimists that globalisation carries profound and profoundly depressing implications for more than the benighted working class in the West.

Tata Motors’ emergence as front-runner to buy Jaguar and Land Rover from the ailing Ford brings one question uppermost to a commentator sitting at a wealthy Western desk: Precisely which economic sectors can be relied upon in the future to provide jobs for Westerners at wages higher than are obtainable in the Third World?  Will there continue to be opportunities to improve Western living standards, or are those living standards destined to descend to some kind of population-weighted average between Boston and Benin?

Tata is a typical and highly capable example of that new breed: the third world multinational company. Part of the multi-industry Tata Group, over a century old, from which it had access to both capital in its formative years and steel currently, it has established itself as the premier manufacturer of light trucks in India and as one of the top three automobile manufacturers. At the bottom of the market, it has announced plans to being out a 100,000 rupee (about $2,500 currently) automobile, which if successful will undercut its major competition by more than 30% and greatly expand the market for automobiles among the still impoverished Indian people.

Conventional Western business analysts have no problem with Tata manufacturing mini-cars for the Indian market, or indeed for developing country markets in Africa and elsewhere. They imagine that Tata is able to use its comparative advantage of cheaper labor to squeeze costs out of the manufacturing process, thus achieving what in the West would be an impossibly low price. They point knowingly to the expensive environmental features that the new automobile will lack, and imagine smugly that the it will be both tiny and of low quality, adequate for the noble impoverished of the Third World, but not seriously to be imagined as competition on the roads of London, New York or Stuttgart.

The announcement that Tata is to buy Land Rover and Jaguar has thus caused a considerable amount of cognitive dissonance. Land Rover and Jaguar are both icons of British automobile manufacture, hand crafted by generations of British skilled labor. Admittedly in the 1970s Jaguar’s quality control became so poor that Jaguars rivaled the Moskvich or the Yugo for frequency of repairs, but since 1979 or so quality has improved and the marque has established a cherished if not particularly profitable niche among the luxury automobiles of the world.  Moreover, would Western buyers shell out the substantial cost of a Jaguar if they knew it had been manufactured in India; after all, how could the quality be relied upon?

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With thanks to Flavio Gonzales at Troy’s forum, I’m pasting - without additional comment - the meat of an article on Bilderberg 07 by Daniel Estulin
GW

The delegates at Bilderberg 2007: Istanbul, Turkey May 31-June 3

This year’s delegation will once again include all of the most important politicians, businessmen, central bankers, European Commissioners and executives of the western corporate press. They will be joined at the table by leading representatives of the European Royalty, led by Queen Beatrix, the daughter of the Bilderberg founder, former Nazi, Prince Bernhard of the Netherlands and Bilderberger President, Etienne Davignon, Vice Chairman, Suez-Tractebel from Belgium. According to Bilderberg Steering Committee list which this author had access to, the following names have now been confirmed as official Bilderberg attendees for this year’s conference (In alphabetical order):-

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Here’s Monday’s piece from Martin, posted originally at Prudent Bear.  A dose of cold realism for Mr Wolfowitz and the World Bank.

The World Bank gave the developing world an unexpected Christmas present Wednesday, when it unveiled its annual “Global Economic Prospects” report, looked out to 2030 and projected a higher developing country growth rate than in 1980-2005 and a huge emerging Third World middle class.  Since it’s the job of the Bear’s Lair to deflate unwarranted optimism, the report represents a challenge that must be addressed.

The World Bank stated its expectation that GDP per capita in the developing world would grow 3.1% per annum as against 2.1% in 1980-2005. Its central argument is that the rapidly emerging global middle class, 1.2 billion strong in 2030, three times its 2005 size, with family incomes between $18,000 and $60,000, will realize their true interest and vote for World Bank-friendly policies such as open trade barriers and globalist foreign policies.

Even were they to do such a thing, it’s doubtful what effect they could have, since they would still be far outnumbered by the 6.8 billion impoverished souls who gain little from globalization and who would have to depend on benign “pro-poor policies” voted by the emerging middle class for the meager handouts that made their miserable existence possible.

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It’s Monday, and this week prudentbear.com ran the Hutchinson take on property rights and the brief and likely fatal joys of outsourcing.  The bearish nature of this message runs with the dissident grain and is a clever man’s way of introducing reasonable doubt into the conventional-thinking, mainstream mind.

GW

In a world in which information is an increasingly important commodity and intellect is the principal means of producing such information, David Ricardo’s 1817 Doctrine of Comparative Advantage may no longer be valid.  However the theory that free trade enriches all participants, central to modern globalization, depends crucially on Ricardo, with protectionists being denounced (sometimes correctly) by professional economists as economic illiterates.  What then is an economically literate framework for trade in a post-Ricardo world?

In his 1990 paper “Endogenous Technological Change” economist Paul Romer showed that economic growth is caused primarily by the spread and interaction of information, some but not all of which is “excludable” in that others can be prevented from using it once it’s created.  As an instance of information-driven technological change, he instanced Francis Cabot Lowell’s 1811 industrial espionage on British power looms, through which he created the U.S. textile industry.

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This afternoon my OE Inbox mysteriously received Martin Hutchinson’s latest Bear’s Lair piece.  This one considers the prospects for the globalising economy.  I am very pleased to publish it here.

The Nobel Peace Prize awarded to Muhammad Yunus, the founder of Grameen Bank, is well deserved. While imperfect, his invention of micro-lending is an important tool to make the free market system work better for the world’s poor. Nevertheless, the vision that Grameen represents, of a peaceful integrated “globalized” world in which can all prosper, is increasingly coming under threat. In 1996, with Communism defeated, Bill Clinton in the White House and the Internet rising to prominence, a globalized “Washington Consensus” world seemed the inevitable future. However, it’s not 1996 any more.

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The prospects are great for ecologically imposed patriarchy enhancing the fertility of whites via oceanic frontiers.  The majority of the earth’s surface remains not only uncultivated, but not biologically productive despite the presence of adequate sunlight and near-adequate nutrients. If recent experiments in iron fertilization of high nitrogen low chlorophyll oceanic surface regions are any indication, the primary ingredient lacking is the pioneering spirit that led to the cultivation and increased carrying capacity of the Anglosphere’s frontier territories: The United States, Canada, New Zealand and Australia.  It is reasonable to expect that the Anglosphere alone could increase its numbers by a factor of 10, relatively unmolested by multicultural supremacists, during this pioneering renaissance and maintain if not improve the quality of their populations.  Other, less sea-faring European peoples could enjoy smaller but nevertheless profound population and territorial relief.  Moreover this population increase could be very rapid if the fertility rates of the United States frontier is any guide.  This is a prospect that seems plausible in no other way short of world war.

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A key distinguishing feature of humanity is its communication ability.  But what exactly is communication as opposed to manipulation?  How does communication arise?  What are the conditions for its continuation?  There have been a number of attempts at simulating the evolution of communication but till the simulation described in this article was run, none of them combined migration, climatic variation and the prisoner’s dilemma.

The simulaton is schematic but suggestive that migration can eliminate the very genetic capacity for communication and replace it with pure manipulation.

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A little good news is needed now and then. The pioneer spirit is still alive. As a person somewhat responsible for the resurgence in technology prize awards, I have a few things to say about Burt Rutan’s capture of the Ansari X-Prize by being the first to fly a man to space in a reusable craft twice within a week. He follows the great technology pioneers Henry Ford and Charles Lindbergh, both of whom came to prominence during similar fair contests: The Guggenheim Trophy and Orteig Prize respectively. (From these exemplars some might now see a reason the powers that be shy away from fair contests—contests where they can’t really control who wins the prizes—and it was left to an Iranian family, the Ansaris, to fully fund the X-Prize.)

A speech by Burt Rutan before the National Space Society is worth a view (requires QuickTime ). He repeatedly and angrily declares his embarrassment at the risk averse culture that has strangled the pioneer spirit since the feats of the 1960s—nearly 40 years ago. I’ve got my issues with his speech but we clearly agree that something went horribly wrong with the pioneer spirit subsequent to the 1960s. The turning inward of the human potential has resulted in the halting of human progress upward and outward with aerospace technology being bureaucratically and monotonously scaled up for jumbo jet transportation. The result is the sort of danger warned of by Charles Lindbergh in his 1939 Reader’s Digest article “Aviation, Geography, and Race”: a sea of humanity threatening our race which is, after all, a global minority. Indeed the technological exemplar of this era has been driven by the rise of finance to preeminence—the inward-turning microelectronic revolution. The unintended side-effect of this revolution you see before you now as a website, but it is small consolation for the damage to our pioneer spirit.  As we were warned by Henry Ford the great struggle of the 20th century was creative industry vs global finance.  Global finance has dominated the past 30 years or more. Perhaps men like Burt Rutan can lead us out of our malaise and realize the human potential.  If so it may be due to prize awards like the Ansari X-Prize that give men even younger than Burt Rutan a chance to make a name for themselves purely via their own grit and gifts.

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