Interdependence Is a Good Thing - S. Russell
War and Peace and Globalization
By Steve Russell
It’s an article of leftist faith that capitalism breeds war. Sounds reasonable. War is, after all, the ultimate competition. In the heyday of colonialism, economic clashes came in the form of exploitation licenses gained on the battlefield when they could not be gained from what is now euphemistically called “discovery.” However, I am coming to wonder if globalization will change the shape of the battlefield and the methods of competition in a manner that benefits the ordinary people who are always enlisted to do the dying.
Since Uruguay and Doha, the big fly in the globalization ointment has been the insistence of rich countries upon subsidizing their agriculture. The implication for national security is that the developed world does not wish to depend on farmers in the less developed world. The global capitalists want a level playing field among themselves, but not so level that countries with little industry can make themselves indispensable. Why the hell not? For peace, I suggest that interdependence is a good thing.
Economics would predict that the next major military conflict should be between China and the United States. The American empire is in decline and the Chinese economy is growing in double digits. The roster of Chinese vassal states is sure to expand, giving plenty of excuse for military confrontation. Moreover, some parts of China, in spite of Chinese law, have a rate of male births as high as 130 for every 100 female births. Such a radical imbalance normally leads to war, either because of testosterone poisoning or because women have historically been part of the spoils of war.
On the other side of this gloom and doom, we have China buying the T-bills that the United States is selling to finance our imperial war for oil. We have China’s largest trading partner becoming Wal-Mart, a sub-section of the U.S. that has an economy nearly the size of Belgium. It is normally considered bad business to shoot your debtors or your customers, and we are both. With the U.S. going down and China going up and China with the overload of males in its population, China’s peacefulness is more important than America’s.
In latter part of my second career, I have taken up poker more for amusement than profit. Contemplating retirement, I’ve taken the next logical step and started playing with stocks, at least the ones I feel I can morally own, mostly tech stocks and medical research stocks. Since it’s not for income, I don’t have to worry about my aversion to oil and gas or banks or insurance, without which one cannot have a “balanced portfolio.” This hobby leads me to some observations about war and peace.
Investors are very high right now on the countries known as BRIC---Brazil, Russia, India, and China. These countries represent double digit growth and therefore major investment opportunity. I personally am high on Brazil and India, but I believe the corruption of the governments in Russia and China represent crony capitalism at its worst and their periodic attempts at regulation have been laughably futile. In China, they decided whom to blame for the lead scandal and shot him—too much faith in deterrence there to justify a bet from my limited hobby portfolio. Don’t look for a Chinese or Russian Sarbanes-Oxley any time soon, although they will catch on eventually.
So, I decided I want to invest in solar energy. I want to get as close to the sun as possible, meaning not the companies that install solar systems but companies that hold the patents on the cutting edge technology and do the manufacturing. It turned out to be nearly impossible to find a solar firm that was not deeply involved in China, both for manufacture of chips and for sale of them. There are a few, and many more very prosperous firms that are only listed on European exchanges (where solar subsidies are very expansive), but I was shocked to discover how much solar is happening in China. Being a fairly new industry for the U.S., solar is embedded simultaneously in this country and China such that picking it apart would destroy most of the major solar firms. New tech ideas are often spread out in this way, and how can this be anything but good news for keeping the peace?
Another thing I’ve noticed by keeping my eye on the NASDAQ (and the Dow and S&P because the figures are always streamed together). If there is any big impact on the U.S. markets late in the trading day such that the reaction is still going up or down at the bell, you can track that same reaction with the sunlight. It hits the Nikkei, the Hang Seng, the DAX, and the “Footsie” (FTSE) like it was a weather front proceeding around the world. This is a visual depiction of capital loosed from national borders and if wars are decided by big capitalists then really big wars have now become losers for them just as they have always been for the working class.
