Lao-tzu, The Way of Lao-tzu
All empires have ended due to these causes—war, war and more
war. This exhausts the treasury, as the Chinese sage Lao Tzu knew all too well.
Reading the Lao Te Ching last night, it occurred to me that ancient
Chinese wisdom already knew about that phenomena known as “imperial overreach.”
Therefore in page after page there are warnings: keep away from war, it exhausts
the country by exhausting the treasury.
The Chinese have been good at following this advice. Besides
the invasion and takeover of Tibet in the 1950s (lets overlook minor skirmishes with India over border issues, for the moment), they’ve steered clear of
invasions, buildup of giant arsenals, and warfare. Indeed, even their “lack of
innovation” can be seen, in hindsight, as a strategy of keeping off the warring process
of innovation. Instead, they do what good capitalists have always done—they let
others take the risk in inventing something. Then they simply manufacture and
replicate. Those who own the means of production own the economy, as Marx, sage
of the Western world, said so wisely.
Western countries, on the other hand, have always turned to
warfare as an easy solution to control and dominate. Britain’s empire
collapsed, you might say, because its overt control over people and resources was
done through the authoritarian system of domination. The age of American imperialism seems to be
coming to a close—it is as if the past two decades of unaccountable wars and runaway military spending have
finally brought the economy down to its knees.
The Chinese, on the other hand, have been masters at hiding
their country’s strength—exactly as Lao Tzu advised. Nobody knows how big the
Chinese economy is, at this point—if you add the shadow economy that operates
outside the government control. All we know is this—the Chinese have brought
out 1.25 billion people out of poverty within the span of 30 years or
thereabouts. Through the strict and sober act of fiscal and social discipline,
they’ve managed to transform a giant population (four times the size of the US’s
population) into a well-educated, productive group of citizenry contributing
actively to the world economy.
The problem with Western countries is that they’ve always
relied too much on overt force (and disruption of small economies for monetary
gain) to hold on to oil, natural resources and the like. In 2014, however, these
sort of Machiavellian policies appear to belong to the Dark Ages. Not the least
because “the economy” is no longer just a casino of foreign currencies, and commodities
being traded in the stock market. But it is also billions of people innovating
and producing new products every minute. With these kinds of new players able
to disrupt the market within short periods of time, the key is to keep the
field of trust open so that the country with the most social capital wins, when
they next Big Thing rolls around.
Who will dominate the global economy in the next thirty
years? To me, it appears all the old methodologies of counting (ask your local market
research firm how well the economy is doing) is no longer going to work in
terms of adding up the total economic, social and cultural capital the world
has at its disposal.
If you were to believe mainstream
Western publications, you’d think “the economy” is the rise and fall of the
stock market. But the stock market is just a tiny piece of the puzzle. More fundamentally,
“the economy” is people-billions of people working in small, medium and high
income jobs. The economy is people growing food, making clothes and medicine,
providing education and healthcare, and building public transport. The economy is people painting artwork, making films, singing songs and staging theatre. And when
these foot-soldiers of the economy become tired, underpaid, sick and hungry,
you know the economy of a country, no matter how brilliantly it shines in the
tickers of the stock market, is on the decline.
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