A few comments on one paragraph of the article that Arthur posted:
<<<<
THE FINANCIAL FALLOUT
'New Economy' Is a Thing of the Past
By PETER G. GOSSELIN and JUBE SHIVER JR., TIMES STAFF WRITERS
cut to ---->
The "new economy," already tattered before the assaults, is dying. In its
place will emerge a shadow war economy. Many of these analysts see
government, whose role waned in the last decade, returning with a
vengeance as warrior, regulator, economic manager, big spender. The
private sector, whose entrepreneurial enthusiasms defined the passing age,
will become more corporate and controlled. And the new economy--the
deregulated, wired, just-in-time, globalized new economy of the '90s--will
be gone.
>>>>
I can't agree with this. This is a silly over-reaction. The tragedy in New
York and Washington, horrific though it was, was only a catalyst that
accelerated what was already happening. The downturn in the economy (as the
authors admitted elsewhere in the article) was already happening.
No: globalized corporations -- and the trends (and benefits) of
international trade generally -- are now too powerful for governments to
rein back, even if they wanted to for populist reasons. Equally
importantly, present-day society is far too complex for the reimposition of
highly regulatory governments.
Messrs Gosselin and Shiver in their potpourri of an article in which almost
every current economic issue was mentioned missed out on the most important
of all which happened only a day or two before the plane crashes. This is
the accession of China to the WTO.
Although China doesn't yet rate in the same economic league as Japan,
America or the EEC, it is the only country which is still growing in the
present downturn -- and this without having to rely on Middle East oil or
getting involved in dangerous Jewish v. Islamic politics as the others have
to.
China, arguably the most inventive nation in history until about a century
and a half ago, has now overcome its mandarinic resistance to trading with
the outside world. There'll be little to stop it from being one of the two
most powerful countries in the world or, perhaps, the only one. Even if
America, Japan and the EEC adopt protective anti-globalization policies
(which seems unlikely as already hinted), then there's enough of an Asian,
non-EEC European market (including Russia) for China to continue its
present sort of 8% annual growth for at least two or three decades to come.
When the present economic recession unwinds (in one/two/three years?),
continuing globalization will mean, as now, better and cheaper products for
the average consumer in the West. However, for a significant minority in
the developed world, the economic divide within each country will be
greater than ever before. About 20% of the population of the UK hardly
benefited from the boom of the last 8/10 years, nor will they benefit when
growth resumes. This mainly involves those who cannot even read when they
leave school, never mind having any jobs skills. My guess is that about the
same proportion of a permanent "underclass" is to be found in most
developed countries.
To a very considerable extent, the economic success of America in the last
century and a half has been due to the enterprise and brains of its
immigrants. This has been particularly so in the last two or three decades
when America has been able to attract many of the brightest scientists and
technologists in the world -- more than compensating for the low standards
of its rapidly deteriorating state education system. In the UK, even the
Labour Government is proposing all sorts of possible privatisation
variations of the state educational system -- deteriorating quite as
rapidly as in America. But it is facing intense opposition from the
teaching unions and ideological egalitarians and it's doubtful that they'll
have the courage to carry them out, even if they had the competence.
China, with its rapidly growing private education system (and with 60,000
of their best and brightest studying in America and the UK), has more than
a chance of taking over the No 1 slot in a decade or so from now.
Keith Hudson
___________________________________________________________________
Keith Hudson, General Editor, Calus <http://www.calus.org>
6 Upper Camden Place, Bath BA1 5HX, England
Tel: +44 1225 312622; Fax: +44 1225 447727;
mailto:[EMAIL PROTECTED]
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