Posts Tagged ‘future’
HSBC’s World Expert Predicts a Rosy Future for The World
In HSBC’s China Expert Predicts a Rosy Future for China I slammed HSBC’s predictions for China over the coming ten years, little did I know they were going to make even more “rosy” predictions for China over the coming forty years!
Crunching everything from fertility rates to schooling levels and the rule of law, HSBC predicts that the world’s economic output will triple again by 2050, provided the major states can avoid conflict – trade wars, or worse – and defeat the Malthusian threat of food and water limits. Growth will rise to 3pc on average, up from 2pc over the last decade.
In a sweeping report entitled “The World in 2050″, the bank said China would snatch the top slot as expected, but only narrowly. China at $24.6 trillion (constant 2000 dollars) and the US at $22.3 trillion will together tower over the global economy in bipolar condominium – or simply the G2 – with India at $8.2 trillion far behind in third slot, and parts of Europe slithering into oblivion.
—HSBC sees China and America leading global mega-boom, The Daily Telegraph
To forecast the future one has to study the past, economists who crunch time series can not predict anything, because all this data has no context. Yet this economist seems able to predict China’s GDP forty years from now to the tenth of a trillion! He should have shown humility and just declared that both China and the US will have about a little less than a fifth of the World’s GDP, while India will lag behind with less than a tenth. Even such a reasonable wording would have been utterly ridicules.
China has been in a transition for the last thirty years, most economic numbers either were not collected or had a totally different meaning. Numbers for the last twenty years can not be used to forecast the future, it would be like using a teenager’s growth rate to forecast how tall he would be at the age of 40. Anyway the statistics published in China are hugely misstated for internal (local government fooling central government) or external (central government fooling the world) reasons.
From the article I can see two important problems with this report’s method. First it assumes that the inevitable will not happen. Current conditions will cause trade wars and food shortages. Assuming this will not happen is like assuming that San Francesco will be fine as long as tectonic plates stop moving. The growth of China in the last thirty years is itself predicated on conditions that will generate conflict with the US. The current situation might last another ten years, but the longer it goes the worst the conflicts will be be.
Second the report considers fertility rates, which I believe to be one of the most important indicators, unfortunately the report, according to the Telegraph’s article, has no understanding of fertility rates or population dynamics:
The surprise is how well the Anglo-Saxon states hold up under HSBC’s model, which is based on the theoretical work of Harvard professor Robert Barro. America’s high fertility rate (2.1) will allow it too keep adding manpower long after China’s workforce has begun to contract in 2020s and as even India starts to age in the 2040s.
…
Britain at $3.6 trillion also fares well, slipping one rank to sixth place but pulling far ahead of Italy and France, and almost displacing Germany as Europe’s biggest economy. This is chiefly due to the UK’s healthy fertility rate (1.9), although sceptics might question whether a birthrate inflated by the EU’s highest share of unmarried teenager mothers is a good foundation for prosperity.
The low fertility of Korea (1.1), Singapore (1.2) Germany (1.3), Poland (1.3), Italy (1.4), Spain (1.4) and Russia (1.4), more or less dooms these countries to aging crises and population decline unless they open the floodgates to immigration.
—HSBC sees China and America leading global mega-boom, The Daily Telegraph [my emphasis]
Highest fertility rate in the world (from Wikipedia)
2.1 fertility rate is high?! Only a Harvard professor would think so. That is exactly the fertility needed to keep the population at a constant. Without access to the report I do not know if it calls 2.1 high and 1.9 healthy or they are the words of the journalist. What is clear is that these are very low levels which will result in problems over 40 years. The problem is actually bigger because the majority white population of the US have had a sub-replacement fertility rate for some time, as the new census will show that their share of the population has declined below 75%.
The UK is even in a worse situation; I believe that at least Scotland will succeed before 2050. Their agricultural sector is smaller than Germany & France, which is why they get a rebate from the EU, and their economy has ran on North Sea oil, which already peaked, and financial bubbles. Their prospect is similar to that of the USSR in the eighties: breakup and economic crash.
Fertility rates below 1.5 are not low they are catastrophic. Such low rates in peacetime and during economic well being (no one is dying from hunger in Japan or Italy) is a sign of shame on the governments of those countries. They are killing their own citizens to appease the apatite of a hungry imperialist monster in the guise of economic globalisation. These countries are no different than India and Ireland in the nineteenth century where people died from hunger, while agricultural crops that could have fed them twice over where shipped to Britain.
Russia’s demographics are even worse than the absolute decline in population would suggest, because the ethnic Russians are declining while regional minorities are growing. The Russian model of colonialism (flood the conquered countries with poor Russian peasants) is now in reverse. This trend has sometime to run, but eventually it will result in area’s with majority non-Russians seceding.
What the HSBC report is doing is confirming the path their board has already chosen:
After two decades spent expanding in Britain, the United States and other developed economies, the world’s third biggest bank is shifting its focus back to its Asian roots, and especially China. HSBC wants to become the financier and international bank of choice for China’s growing band of entrepreneurs, just as it bankrolled Hong Kong’s tycoons in the second half of the 20th century.
—Special Report: After U.S. failure, HSBC pushes into China, Reuters
Based in Britain and expanding in China, HSBC is committed to this path for the coming forty years. This report in my opinion is just an intellectual cover. In the end I can say nothing better than what HSBC already admits:
HSBC admits that it economic projections are based on a “rather rosy scenario”.
—HSBC sees China and America leading global mega-boom, The Daily Telegraph
See also:
HSBC’s China Expert Predicts a Rosy Future for China
He really does predict a rosy future for China (source A Guide to China’s Regions, Provinces and Cities):
The guide is half survey and half forecast, the latter seems to be a simple extrapolation of past data. Of course my own prediction, which is anything but rosy, is in The Future History of China Today.
Philosophy lets you ignore mortal facts in your search for the immortal truth. HSBC’s China expert (see his biography at the end of the report) has very little philosophy in him; he is a graduate of China and the US.
China got stuck in Confucianism for 2000 years only to leave it for extreme Stalinism; afterwards it jumped from that frying pan to the fire of Consumerism; when it finally figured out its lack of philosophy it imported an English expert on Confucianism to lecture in its university!
US universities teach economy without any history or historical context:
The history of economic thought was taught as a core course when I attended graduate school in the early 1960’s. It has been replaced by mathematical economics, trivialized by being based on conceptually questionable, ideologically based statistical categories. My most imaginative students at the New School where I taught in New York City dropped out of the discipline and went into sociology or something else. They wanted to study economics to discover how the world operated, but were disappointed to find that this is no longer what the discipline is about.
The situation is worse for those students who stayed in the field and sought academic positions. Promotion is conditional upon publication in “vetted” journals. The key publications are controlled censorially by an intellectual inquisition that blocks any critique of pro-financial free market ideology.
—NeoLiberalism and the Counter-Enlightenment by Michael Hudson [my emphasis]
HSBC’s China expert was a professor of finance at The David Eccles School of Business at the University of Utah.
see also:
But the Stars are Fantastic
Star Trek, 2009, directed by J. J. Abrams, starring Chris Pine, Zachary Quinto and Karl Urban.
I once thought I had found a treasure trove, namely all Nebula and Hugo awards winning short stories from the seventies. Alas the seventies were incapable of producing literature that can withstand the test of time, the stories reminded me of the great scene in Minority Report when a blind Tom Cruise eats a rotten moulding sandwich and then drinks rancid milk!
Despite their unreadable state I gleaned an important insight, most of the writers imagined a future where the differences between the genders had disappeared. Those individual writers were all extrapolating the great changes of the sixties and extending their present to its absurd conclusion (they and their contemporaries thought that was profound). The fact that girls started wearing jeans and t-shirts with little make up (think of Donna from That ’70s Show) and guys had long hair and were more expressive of their feelings (think of Kelso from That ’70s Show) was interpreted by them all as all differences would disappear in the future, which is an absurd thought from empty minds.
They Ignored the natural differences between men and women; ignoring these differences is the root cause of many of the modern society most pressing problems (I touched upon this issue in my post How to Reform Schools and Educate People). They ignored the long history of humanity in favour of a handful of abnormal decades. Their most glaring mistake is their assumption that history develops in a linear fashion, when actually it is non-linear (see my post Non-linear Historical Development).
Well at least the seventies could produce some watch-able films that resisted the passage of time much better than their stories.
“Time has shown that the 1970s was the greatest period for American movies since… the 1950s. But the ’70s—known as the American Movie Renaissance—are not coming back. That fact is proven by this week’s unheralded premiere of The Yellow Handkerchief alongside Film Forum’s revival of Five Easy Pieces, the 1970 New York Film Critics Circle Best Picture winner. Both are road movies—the genre by which ’70s films most clearly revealed modern American behavior, language and habitat. But cultural examination no longer excites contemporary film culture, which is devoted to CGI escapism and indie navel-gazing. “
—Armond White [my emphasis]
The film Star Trek imagines the future as a mundane world populated by television actors (painfully wasting the talents of Eric Bana and Winona Ryder). No historical development have taken place, linear or otherwise, there is only the mundane technological fantasy development. These are not the technological visions of Verne who imagined the possibilities of existing scientific advance, but the fevered hallucination of a scientifically-ignorant television producer—the fact that many scientists adore everything Star Trek is the best indicator that Western Science has degraded beyond salvation.
Fleet Academy is just like any American collage campus, but instead of blonds the loose girls are green skinned. Instead of leaving town, disgruntled alcoholics leave planet. Instead of some far away country, it is a far away planet that gets destroyed. Instead of saving a city, Earth gets saved. Blonde American children are destined to rule by virtue of birth, just like the Ancien Régime claimed the right to divine rule by virtue of birth, all the way to the guillotine.
None of the hope of the sixties or the triumphalism of the eighties or even the nostalgia of Deep Space Nine—a series made by the children of the fifties having both a Cold War and Western themes—is present in the latest film. No vision beyond the personal advancement of yuppies and the satisfaction of the limited imagination of juvenile males. The films itself is a mess, with cadets flying the ship, an admiral abandoning his command, Vulcans showing emotions, huge ships from the future going 25 years unnoticed, the inconsistencies and absurdities goes on and on. Of course details are not the sum of literature, but this commercial enterprise has nothing else going for it, nothing. The Enterprise—ridiculously named by Roddenberry after the Big E while given it the mission of the Beagle—is transformed into an agile fighter that lurks in the shadow of Saturn. Is that really the flagship of the Federation?
According to the barren imagination of non-person like Abrams—the son of a television producer—there is nothing to aspire to in the future, there will be no change in how people live their lives, even over centuries. He does not think space is amazing, but the stars are fantastic and his inability to see this fact is a reflection on an exhausted society that is unable to cope with change. Everything living must change, what does not change is not living. Star Trek is the rancid odour of a decaying cadaver.
The Future History of China Today
[This is not a speculation on what might happen, rather a general description of what will happen. The future is unknown by definition, but like the next line in a poem it follows the rhythm of the whole and rhymes with what comes before it.]
1919— 1948
“In fact, the protracted history of the Chinese socialist revolution started 90 years ago in 1919 on May 4, when 5000 students from Beijing University and twelve other schools held a political demonstration in front of Tiananmen, the focal point of what is today known as Tiananmen Square. The demonstration sparked what came to be known in history as the May Fourth Movement of 1919-21, an anti-imperialism movement rising out of patriotic reactions to China’s then war lord government’s dishonorable foreign relations that led to unjust treatment by Western powers at the Versailles Peace Conference. May Fourth was a political landmark that turned China towards the path of modern socialism through Marxist-Leninism.”
—The Socialist Revolution Started 90 Years Ago in China (Part 1) by Henry C. K. Liu
The seed for a new empire was planted, a new kind of empire. This one was not based on peasant armies or a foreign clan, this was based on an idea; the idea was simple: the only way for China to regain its world position was to apply the latest ideas from the West, whether they were tested or not. In 1919 the latest idea from the West was communism.
1949—1978
“The Mao era lasted from the founding of the People’s Republic on October 1, 1949 to Deng Xiaoping’s grip onto power and policy reversal at the Third Plenum of the 11th Party Congress on December 22, 1978.”
In 1949 the People Liberation’s Army took over the government, their first act was to split the population into two parts: city and country. The PLO spread out its rule: East Turkistan in 1949, Tibet in 1950. The Americans sucked the Chinese into the Korean war and helped drain their energy out.
Ten years later the ruling elite were quite ready to jettison communism, but Mao had other ideas and exploited the city/country divide to delay the transition for another ten years.
1979—2008
“The power transition from Hua to Deng was confirmed in December 1978, at the Third Plenum of the Central Committee of the Eleventh National Party Congress, a turning point in China’s history. The course was laid for the party to move the world’s most populous nation toward the ambitious targets of the Four Modernizations.”
Communism, which was ultra-modern in 1919, had become a stale idea in 1979. The empire returned to its raison d’etre: apply the most modern Western ideas whether they are tested or not. The fashion in 1979 was: free market, deregulation, tax cut, et cetera.
“Chinese economic reform has been undertaken through a series of phased reforms. Generally, these reforms were not the results of a grand strategy, but as immediate responses to pressing problems. In some cases, such as the closing of state enterprises, the government has been forced by events and economic circumstances to do things that it did not want to do. As of 2005, 70% of China’s GDP is in the private sector. The relatively small public sector is dominated by about 200 large state enterprises concentrating mostly in utilities, heavy industries, and energy resources.”
—Economic reform in the People’s Republic of China [my emphasis]
Adopting ideas without a sound philosophical foundation is not really a good strategy even if the idea is an old test one, let alone adopting crazy ideas coming from either intellectuals or think tanks.
“China’s growth has been so rapid that virtually every household has benefited significantly, fueling the steep drop in poverty. However, different people have benefited to very different extents, so that inequality has risen during the reform period. This is true for inequality in household income or consumption, as well as for inequality in important social outcomes such as health status or educational attainment. Concerning household consumption, the Gini measure of inequality increased from 0.31 at the beginning of reform to 0.45 in 2004. To some extent this rise in inequality is the natural result of the market forces that have generated the strong growth; but to some extent it is “artificial” in the sense that various government policies exacerbate the tendencies toward higher inequality, rather than mitigate them. Changes to some policies could halt or even reverse the increasing inequality.”
—Poverty in China [my emphasis]
And so China started to open up, granting economic and social freedoms but holding back political power.
2009—2038
“To say that China’s one-child family policy has been a disaster is an understatement. A report released earlier this month by the nation’s top think tank – the Communist Government’s Chinese Academy of Social Sciences (CASS) – says that the policy has created a huge gender imbalance with significant implications for future social stability.”
—China’s Cassandra prophecy [my emphasis]
The single worst idea adopted in 1979 was population control. The pyramids of Giza might appear mighty but all three rest on the plateau of Giza and their combined weight, millions of tonnes, hardly moved it an inch. The Chinese government might appear mighty but it rests no the Chinese people.
“The sex ratio at birth (between male and female births) in mainland China reached 117:100 in the year 2000, substantially higher than the natural baseline, which ranges between 103:100 and 107:100. It had risen from 108:100 in 1981—at the boundary of the natural baseline—to 111:100 in 1990. According to a report by the State Population and Family Planning Commission, there will be 30 million more men than women in 2020, potentially leading to social instability. The correlation between the increase of sex ratio disparity on birth and the deployment of one child policy would appear to have been caused by the one-child policy.”
—One-child policy [my emphasis]
2039 will be the last year of this central government, the empire lasted exactly 120 years divided into four generations of thirty years each: germination, growth, glory and decline.
See also:
- The 3 by 3 Rule — Part One
- Non-linear Historical Development
- The Story of Europe
- Dynasties in Chinese history from Wikipedia
Buzzwords for the Future
Emergency Measures
Prudent governments with leaders who exercise foresight face few emergencies. Such governments have only to contend with real emergencies and not the consequences of their own action or the inevitable outcome of risk taking and adventure. Governments that are neither prudent nor lead by qualified leaders lurch from one emergency to the other until they crash.
When fiscal emergency measures will not solve the problems they will take economic emergency measures and when those fail they will have to take political emergency measures-as Lenin once remarked politics is economics by other means.
The measures start life within the scope of law, and then become extra-legal, afterwards they become extra-constitutional. First they will be supported and accepted by the public then unsupported but still accepted, by the end they will be neither supported nor accepted.
Read the rest of this entry »
The Myth of Imperial Retreat
[NOTE: the announced break is still in effect, this post is the last before I go off-line for a while.]
I was recently asked to give my opinion on The Archdruid Report, a blog by John Michael Greer. Reading the posts on the main page I found some interesting stuff and some points that I don’t exactly agree with. This post will discuss some points that I don’t agree with in brief; despite my objections the blog is still worth reading and I found the little facts about American life in the forties and fifties very interesting.
“The difference between the fantasy of sudden collapse and the reality of one more localized jolt piling additional burdens on a stumbling society is well worth keeping in mind.”
