The Wealth Recyclers

Tom makes the good point that only the disconnected ‘win’ in the global recession.

Recession touches China (Thomas P.M. Barnett :: Weblog)
You see the pattern: only the disconnected see any “win” in a global recession.

But the biggest losers are not those who are truly and deeply connected, but rather those who recycle wealth without generating any of their own.

The falling price of oil is putting pressure on gap states such as Russia and Venezuela, and destabilizes those regimes far more than that of governments under international protection (such as Ukraine, Hungary, and so on).

Wealth recyclers do not create anything. They produce nothing, and only collect rents on the transportation of wealth placed by God under their lands (oil, natural gas), and needed by more productive peoples in order to create wealth.

We should use this opportunity to accelerate the end of the age of hydrocarbons. We have to make sure that the market for biofuels stays attractive, so that ready alternatives to gasoline and natural gas are available. This means both helping domestic producers and encouraging the new core economies to do likewise.

Sales of the Detroit 3 automakers are off 47% for Chrysler, 41% for GM, and 31% for Ford.

If these companies go bankrupt, it will clear out dead wood in the auto industry, making it easier for other auto makers to survive and meet higher fuel economy standards.

If we do decide to save these companies, we should use the leverage their bad policies have given us to enforce change.

Oriental Democracy

The removal of Thailand’s Prime Minister and arrest of Taiwan’s former President should give pause to those who insist on democracy as a near- or medium- way forward for the new core economies of the far east.

Building democracy is an important goal, and China is making significant achievemetns to that end. A stable economy is built on a stable middle class integrated into the world. Democracy as a political system makes sense if an even worse system must be avoided, or if democracy can allow the people to fire ineffective rulers without disrupting the system,.

The unfortunate news from Taiwan, and not Thailand, shows the potentially destabilizing effects of free elections. If China can continue to strengthen its economy and ‘build democracy’ without elections, then China is doing her share to contributing to the world and helping construct a peaceful future.