Western Europe – The Decline In Economic Power

Share Of World GDP | Share of GDP: China, India, Japan, Latin America, Western Europe, United States; January 20, 2008; image source & courtesy – visualizingeconomics.com
The interesting statistic (graphical representation by Catherine@Visualizing Economics) in this chart is the cycle of Western Europe GDP. This, you will note, largely tracks the rise and fall of slavery and its proxy, colonialism. The rise of the West has been a case of ‘consumption’ of slaves to fuel their economic rise. Note the rapid fall in Western Europe incomes and GDP after loss of slaves and colonies – starting from 1850s (decline in slavery begins) till the 1950 (when decline in colonialism begins).
The current share of Western European GDP is also a statistical miracle based on the Bretton Woods financial topology – and the statistical lag between reality and its measures. Having painted themselves, in a corner, with a high cost economy, a bloated welfare state, an aging population (again, a side effect of the slavery on social structures; who would want a wife, if one can have a slave instead), Western Europe is terminally sick.
Combine the declining share of the economic pie and the rise in neo-con clamour, calls for increased vigilance against Western adventurism in the Middle East, Africa and maybe Asia too.
Is Iraq, Afghanistan, Pakistan, the shape of things to come?
Related Articles
- 10 Things You Need to Know About Slavery (That You Won’t Learn from Django Unchained) (alternet.org)
The Urbanisation Experience – The World & India
Post colonial India, in the last 60 years has seen the shift of 30 crore (300 million) people from villages to cities – which is nearly the population of the entire USA. In 1947, India’s urban population was 6 crores (60 million) – and in 2008, it is estimated to have crossed 36 crores (360 million). Another 500 million are expected to move in the next 20 years.
It is the largest demographic shift in the history of mankind – without wars, revolts or persecution. Most revolts, wars and upheavals have been accompanied by urbanization. Urbanization as the cause or an enabler of the revolutions is a matter of debate, research and conjecture.
India is different.
Indian culture started with urban centres like Harrapa and Mohenjodaro (dated between 2000-4000 BC). India has gone through many cycles of urbanization and rural migration. Ashoka the Great resolved to build monasteries “in 84,000 of the cities of Jambudwipa”
The last de-urbanization happened at the the start of British Colonialism during the 1800-1850 period. Cities like Dhaka lost between 50% to80% of its population. British Colonialism immediately started flooding India with its Manchester & Lancaster wares – and restricted Indian handloom weavers from competing with Manchester & Lancaster.
.gif)
Major Urban Agglomerations
The Renewal Of Mumbai
In 1982, Dr.Datta Samant called for strike by the textile workers in Mumbai. The strike went on for a year. Textile industry in Mumbai, tethering on the brink of collapse, went bankrupt.
Half of Mumbai’s population (my estimate) was, directly or indirectly, dependent on these mills. In one of the most heroic renewals in modern urban history, Mumbai re-invented itself. From the manufacturing capital of the country, Mumbai has become the services capital of the country. It is this spirit which has made the Indian urban growth a remarkable story in the urbanization of the world’s population.
Many Religions
The largest Islamic population to co-exist peacefully with another religion, in the world, now lives in India. While the West has been demonizing Islam, Indians Muslims have been getting ahead. In the last 10 years, Indian Muslims have become the richest (Azim Premji), occupied the highest office in the land (APJ Kalam) in this country.
Europe – Revolution & Civil War
In 1800, 23 European cities boasted of a 100,000 population. By 1900, there were 135 cities with over 100,000 citizens. Amongst other causes, increased urbanization was a feature of the French Revolution – which started a chain of revolutions for the next 125 years.
The Russian Revolution by the Communists succeeded due to the rapid urbanization of Russia. Urban Russian population doubled from 7.3 to 14.6 million between 1867 and 1897. Expansion of railways between 1892-1903 made migration and travel to cities easier. Tsarist Russia, built on the support an land owning nobility, with serfs used for production, found that the urbanized industrial workers supported the Communists.
With increasing urbanization and the decline of colonies, Spain slipped into a civil war.
The Balkans Civil War, now running in its 100th year, with intermittent breaks and under different names, started with the urbanization.
South America
Among other things, urbanization played a major feature in South American 150 years after de-colonization. From 1820 – 1970, South America went through de-colonization, urbanization, revolts, revolutions – and crime.
The tipping point in South America was initially de-colonization, peasant and slave revolts and thereafter urbanization.
Why Are Cities The Focal Point
Cities provided spaces where large numbers of people could gather – and a ‘change process’ can start. Red Square in Moscow, Champs de Mars (where the first public meeting after the French Revolution) took place, the Tian An Men in Beijing, or the Shivaji Park in Mumbai are places where such meetings can happen.
Marx famously dismissed peasants as “a sack of potatoes” – and saw the urban worker as the base for the workers’ revolution. Peasant revolts are more difficult to organize as the population is spread over vast areas.
Where Do We Go From Here
This urban growth in unprecedented – and unparalleled. It shows the tremendous adaptability and resilience of the Indian. The Indian urban concept aspires towards foreign idiom – and that is the problem.
Mumbai wants to become another Shanghai, says Chief Minister, Vilas Rao Deshmukh. This aspiration is something that is mostly referred in a derisive manner by others – thankfully.
What Indian cities need instead, is to learn from the home grown examples. For instance, the Mumbai urban train transport system. For a monthly cost of Rs.70-200 (US$2-US$5), people in Mumbai can travel any number of times, in relative discomfort. It is a safe mode of transport – unlike the legacy rail system of the Colonial Britain, which India modernised over 35 years. Accidents on this system happen due to its popularity – overcrowded trains. It is also profitable – and devoid of subsidies. Similar metros (not in scale or traffic though) have come up in Kolkatta and New Delhi.
What Indian cities needs are an Indian idiom – to solve the problems of these Indian cities. Will Indian planners deliver!
The World Financial System – Shape of Things To Come …
The US President, flanked by Treasury Secretary, Jack Fleischacker, and Paul M.Gruber, Governor, European Central Bank, in a stunning move, announced the merger and re-capitalisation of the IMF and World Bank – a plan to rescue world economy.
IMAR
The new entity has been named as International Monetary Authority & Reserve (IMAR) – and will operate from Paris. It has been given the responsibility for world’s economic stabilisation.
The Governing Council Members will initially comprise of 3 internationally respected financial authorities and investors. The Chairman is likely to be Barran Wolfet and his team members are Sorg Goros and Rim Joggers. “The selection of the Governing Board was done on the basis of consensus and the expertise of the incumbents. This is not the time for being narrow – when the future of the global financial system is at stake.”, said Governor Gruber.
Capital Subscriptions
The US has subscribed to promissory notes worth 25,000 tons of gold, currently held at Fort Knox. The ECB will subscribe to the tune of 20,000 tons of gold – to be held at various European national Government vaults. Australia and Canada have also announced subscriptions to the tune of 10,000 tons of gold each to be held in bonded vaults at Montreal and Canberra respectively. Britain and Switzerland have committed 5000 tons – out of the Bank of England and Schweizerische Nationalbank (SNB) reserves. These countries will be allocated voting rights proportionately, based on IMAR gold reserve subscriptions.
The US dollar will now be backed by IMAR promisorry notes – which President Jack Boucher, asserted will create confidence in the US dollar – and in the world financial system.
Governor Gruber remarked,”The Bretton Woods Agreement has facilitated a “historic economic expansion in the global trade” – and this new measure will further strengthen the Bretton Woods system. IMAR single-point agenda is stabilization of the global economy.” Country reserves will be nominated on the basis of IMAR promissory notes – and countries will report on these regularly. Total monetary aggregates for the national economy will also see a change. “Old economic measures like M3 money figures will no longer be relevant in the era of derivatives and options”, said Gruber.
The ASEAN, Chinese and Japanese Governments have cautiously welcomed this move, with a joint declaration saying “this will hopefully lend some stability to the US dollar – and the trillions of reserves that we maintain”. The new martial law administrators in the South African Government are due to the announce their subscriptions soon. Saudi Arabia, Iraq, the UAE and Singapore have announced that they will be committing substantial assets towards their share of subscriptions. Russia is still undecided – and expected to approve soon.
Criticism
India has criticised the move strongly. Prime Minister, Sonia Gandhi said, “this new system will perpetuate existing economic systems and divisions.” Iran’s President, Mohammed Hussaini bluntly dismissed this development and said, “the developing world will not have a voice in the new organization.”
The new Indian Finance Minister Banta Singh said,”This will not help in restructuring the international finacial systems. This is not the ‘new financial architecture’ that we are want.” When asked what his ideas were were declined to reveal them, as “it too premature.”
The IMAR Governor, Wolfet rejected the criticism, saying, “IMAR will be a international body – for implementing a rescue plan for the world economy. Developing Countries will have 50% representation on the Director’s Register. They, can get even higher voting rights by increased subscriptions. Our past experience shows that countries print currency – and risk global financial equilibrium. We cannot allow that to happen again.”
US and the EU have also announced a doubling in aid allocations. Instead of outright grants in aid, transfers will now be based on mutual trade norms. African countries, for instance, will be able to develop trade with the West – while receiving aid. EU and USA will commit to specific trade volumes, such that Africa will be able to develop, for instance, its mining and resource based industries.
Currency Fluctuations
Governor Gruber claimed that “currency fluctuations are a thing of the past, as trade will now be denominated by currency demand and supply. International currency acceptance will be determined by IMAR reserves of each currency system.”
Gold Reserves
The most interesting part of this development is the quantum of gold being committed by the subscribers. The ECB and the Federal Reserve have been able to fulfill their subscriptions based on gold reserves that they have enhanced in the last few months.
It is being whispered that Barran Wolfet and his team members, Sorg Goros and Rim Joggers had played a major role in the enhancement of these gold stocks – and the formation of IMAR. Initially named as Global Financial Reserve Authority for Development, the IMAR idea was first tossed out over a dinner at the famous Les Ambassadeurs eatery – which offers a classic cuisine by the Ducasse-trained chef, Jean-François Piege.
Want to decode this news? What this really means for you! Ask St.Barnum, The Propaganda Slayer.
Post Script
On 8th October, 2008, it was reported, that both the Republican and Democratic candidates concede that Warren Buffet …
would be a good replacement for current Treasury Secretary Henry Paulson who is standing down at the end of the current administration.
“I think the first criteria, would have to be somebody who immediately Americans identify with. Immediately say we can trust that individual,” said McCain. Buffett, chief of the Berkshire Hathaway holding company, has supported Obama in the race for the White House.
5 comments