Sunday, August 03, 2008


The following was sent to me recently.
Some of it makes sense.
Some of it feels, how should I put this?
A bit simplistic and verging on dismissive of the million variables of history.
Being the liberal that I am some of it makes me a little squeamish in that the starting point seems to suggest that Western Culture begins from a moral or objective position of superiority.
Maybe it doesn't explicitly say that but something tugging at the back of my head makes it feel that way.
I'm not sure why the Chinese world and Islamic world are pushed by singular powerful forces (and markedly different cultural and economic imperatives) .
So many crucial (to me at least) factors seem to be missing.
Israel for instance is not given any real context in explaining the Islamic-western dilemma.
Africa appears to be a bit player and is relegated to a vast resource rich playground for proxy conflicts and influence peddling reminiscent of the cold war.
The cold war ended in a way no one foresaw (except apparently Mr. Meyer).
Nassim Nicholas Talib argued in his book "Black Swans" such analysis misses the point. Predicting the great swings in history through inductive logic is almost impossible.
"Almost all consequential events in history come from the unexpected while humans convince themselves that they can be explained but do so through hindsight and bias."
Whether you think I'm right and the essay below is too simplistic, or that reasoned conjecture is no closer to predicting the future than rolling the dice, have a look and tell me what you think.
No one usually comments on the posts I hope they will but maybe this time I'll get lucky. If nothing else the line about Americans losing their culture and becoming just like Europeans should get some people grinding their teeth.
(Pick up the book anyway as its an interesting read)

INTELLIGENCE BRIEFING FOR CEOs
By HERBERT MEYER


This is a paper presented some weeks ago by Herb Meyer at a Davos,
Switzerland meeting which was attended by most of the CEOs from all
the major international corporations -- a very good summary of
today's key trends and a perspective one seldom sees. Herbert E.
Meyer served during the Reagan Administration as Special Assistant to
the Director of Central Intelligence and Vice Chairman of the CIA's
National Intelligence Council. In these positions, he managed
production of the U.S. National Intelligence Estimates and other top-
secret projections for the President and his national security advisers.

Meyer is widely credited with being the first senior U.S. Government
official to forecast the Soviet Union's collapse, for which he later
was awarded the U.S. National Intelligence Distinguished Service
Medal, the intelligence community's highest honor.

Formerly an associate editor of FORTUNE, he is also the author of
several books.

-

WHAT IN THE WORLD IS GOING ON?
A GLOBAL INTELLIGENCE BRIEFING FOR CEOs

By HERBERT MEYER


FOUR MAJOR TRANSFORMATIONS

Currently, there are four major transformations that are shaping
political, economic and world events. These transformations have
profound implications for American business leaders and owners, our
culture and on our way of life.


1. The War in Iraq

There are three major monotheistic religions in the world:
Christianity, Judaism and Islam. In the 16th century, Judaism and
Christianity reconciled with the modern world. The rabbis, priests
and scholars found a way to settle up and pave the way forward.
Religion remained at the center of life, church and state became
separate. Rule of law, idea of economic liberty, individual rights,
human Rights-all these are defining point of modern Western
civilization. These concepts started with the Greeks but didn't take
off until the 15th and 16th century when Judaism and Christianity
found a way to reconcile with the modern world. When that happened,
it unleashed the scientific revolution and the greatest outpouring of
art, literature and music the world has ever known. Islam, which
developed in the 7th century, counts millions of Moslems around the
world who are normal people. However, there is a radical streak
within Islam. When the radicals are in charge, Islam attacks Western
civilization. Islam first attacked Western civilization in the 7th
century, and later in the 16th and 17th centuries. By 1683, the
Moslems (Turks from the Ottoman Empire) were literally at the gates
of Vienna. It was in Vienna that the climatic battle between Islam
and Western civilization took place. The West won and went forward.
Islam lost and went backward. Interestingly, the date of that battle
was September 11. Since them, Islam has not found a way to reconcile
with the modern world.

Today, terrorism is the third attack on Western civilization by
radical Islam. To deal with terrorism, the U.S. is doing two things.
First, units of our armed forces are in 30 countries around the world
hunting down terrorist groups and dealing with them. This gets very
little publicity. Second we are taking military action in Afghanistan
and Iraq.

These actions are covered relentlessly by the media. People can argue
about whether the war in Iraq is right or wrong. However, the
underlying strategy behind the war is to use our military to remove
the radicals from power and give the moderates a chance. Our hope is
that, over time, the moderates will find a way to bring Islam forward
into the 21st century. That's what our involvement in Iraq and
Afghanistan is all about.

The lesson of 9/11 is that we live in a world where a small number of
people can kill a large number of people very quickly. They can use
airplanes, bombs, anthrax, chemical weapons or dirty bombs. Even with
a first-rate intelligence service (which the U.S. does not have), you
can't stop every attack. That means our tolerance for political
horseplay has dropped to zero. No longer will we play games with
terrorists or weapons of mass destructions.

Most of the instability and horseplay is coming from the Middle East.

That's why we have thought that if we could knock out the radicals
and give the moderates a chance to hold power, they might find a way
to reconcile Islam with the modern world. So when looking at
Afghanistan or Iraq, it's important to look for any signs that they
are modernizing.

For example, women being brought into the work force and colleges in
Afghanistan is good. The Iraqis stumbling toward a constitution is good.

People can argue about what the U.S. is doing and how we're doing it,
but anything that suggests Islam is finding its way forward is good.


2. The Emergence of China

In the last 20 years, China has moved 250 million people from the
farms and villages into the cities. Their plan is to move another 300
million in the next 20 years. When you put that many people into the
cities, you have to find work for them. That's why China is addicted
to manufacturing; they have to put all the relocated people to work.
When we decide to manufacture something in the U.S., it's based on
market needs and the opportunity to make a profit. In China, they
make the decision because they want the jobs, which is a very
different calculation.

While China is addicted to manufacturing, Americans are addicted to
low prices. As a result, a unique kind of economic codependency has
developed between the two countries. If we ever stop buying from
China, they will explode politically. If China stops selling to us,
our economy will take a huge hit because prices will jump. We are
subsidizing their economic development; they are subsidizing our
economic growth.

Because of their huge growth in manufacturing, China is hungry for
raw materials, which drives prices up worldwide. China is also
thirsty for oil, which is one reason oil is now at $100 a barrel. By
2020, China will produce more cars than the U.S. China is also buying
its way into the oil infrastructure around the world. They are doing
it in the open market and paying fair market prices, but millions of
barrels of oil that would have gone to the U.S. are now going to
China. China's quest to assure it has the oil it needs to fuel its
economy is a major factor in world politics and economics.

We have our Navy fleets protecting the sea lines, specifically the
ability to get the tankers through. It won't be long before the
Chinese have an aircraft carrier sitting in the Persian Gulf as well.
The question is, will their aircraft carrier be pointing in the same
direction as ours or against us?


3. Shifting Demographics of Western Civilization

Most countries in the Western world have stopped breeding. For a
civilization obsessed with sex, this is remarkable. Maintaining a
steady population requires a birth rate of 2.1 In Western Europe, the
birth rate currently stands at 1.5, or 30 percent below replacement.
In 30 years there will be 70 to 80 million fewer Europeans than there
are today. The current birth rate in Germany is 1.3. Italy and Spain
are even lower at 1.2. At that rate, the working age population
declines by 30 percent in 20 years, which has a huge impact on the
economy. When you don't have young workers to replace the older ones,
you have to import them.

The European countries are currently importing Moslems. Today, the
Moslems comprise 10 percent of France and Germany, and the percentage
is rising rapidly because they have higher birthrates. However, the
Moslem populations are not being integrated into the cultures of
their host countries, which is a political catastrophe. One reason
Germany and France don't support the Iraq war is they fear their
Moslem populations will explode on them. By 2020, more than half of
all births in the Netherlands will be non-European.

The huge design flaw in the postmodern secular state is that you need
a traditional religious society birth rate to sustain it. The
Europeans simply don't wish to have children, so they are dying. In
Japan, the birthrate is 1.3. As a result, Japan will lose up to 60
million people over the next 30 years. Because Japan has a very
different society than Europe, they refuse to import workers.
Instead, they are just shutting down. Japan has already closed 2,000
schools, and is closing them down at the rate of 300 per year. Japan
is also aging very rapidly. By 2020, one out of every five Japanese
will be at least 70 years old. Nobody has any idea about how to run
an economy with those demographics.

Europe and Japan, which comprise two of the world's major economic
engines, aren't merely in recession, they're shutting down. This will
have a huge impact on the world economy, and it is already beginning
to happen. Why are the birthrates so low? There is a direct
correlation between abandonment of traditional religious society and
a drop in birth rate, and Christianity in Europe is becoming irrelevant.

The second reason is economic. When the birth rate drops below
replacement, the population ages. With fewer working people to
support more retired people, it puts a crushing tax burden on the
smaller group of working age people. As a result, young people delay
marriage and having a family. Once this trend starts, the downward
spiral only gets worse. These countries have abandoned all the
traditions they formerly held in regard to having families and
raising children.

The U.S. birth rate is 2.0, just below replacement. We have an
increase in population because of immigration. When broken down by
ethnicity, the Anglo birth rate is 1.6 (same as France) while the
Hispanic birth rate is 2.7. In the U.S., the baby boomers are
starting to retire in massive numbers. This will push the elder
dependency ratio from 19 to 38 over the next 10 to 15 years. This is
not as bad as Europe, but still represents the same kind of trend.

Western civilization seems to have forgotten what every primitive
society understands-you need kids to have a healthy society. Children
are huge consumers. Then they grow up to become taxpayers. That's how
a society works, but the postmodern secular state seems to have
forgotten that. If U.S. birth rates of the past 20 to 30 years had
been the same as post-World War II, there would be no Social Security
or Medicare problems.

The world's most effective birth control device is money. As society
creates a middle class and women move into the workforce, birth rates
drop. Having large families is incompatible with middle class living.

The quickest way to drop the birth rate is through rapid economic
development. After World War II, the U.S. instituted a $600 tax
credit per child. The idea was to enable mom and dad to have four
children without being troubled by taxes. This led to a baby boom of
22 million kids, which was a huge consumer market. That turned into a
huge tax base. However, to match that incentive in today's dollars
would cost $12,000 per child.

China and India do not have declining populations. However, in both
countries, there is a preference for boys over girls, and we now have
the technology to know which is which before they are born. In China
and India, families are aborting the girls. As a result, in each of
these countries there are 70 million boys growing up who will never
find wives. When left alone, nature produces 103 boys for every 100
girls. In some provinces, however, the ratio is 128 boys to every 100
girls.

The birth rate in Russia is so low that by 2050 their population will
be smaller than that of Yemen. Russia has one-sixth of the earth's
land surface and much of its oil. You can't control that much area
with such a small population. Immediately to the south, you have
China with 70 million unmarried men who are a real potential
nightmare scenario for Russia.


4. Restructuring of American Business

The fourth major transformation involves a fundamental restructuring
of American business. Today's business environment is very complex
and competitive. To succeed, you have to be the best, which means
having the highest quality and lowest cost. Whatever your price
point, you must have the best quality and lowest price. To be the
best, you have to concentrate on one thing. You can't be all things
to all people and be the best.

A generation ago, IBM used to make every part of their computer. Now
Intel makes the chips, Microsoft makes the software, and someone else
makes the modems, hard drives, monitors, etc. IBM even out sources
their call center. Because IBM has all these companies supplying
goods and services cheaper and better than they could do it
themselves, they can make a better computer at a lower cost. This is
called a fracturing of business. When one company can make a better
product by relying on others to perform functions the business used
to do itself, it creates a complex pyramid of companies that serve
and support each other.

This fracturing of American business is now in its second generation.

The companies who supply IBM are now doing the same thing -
outsourcing many of their core services and production process. As a
result, they can make cheaper, better products. Over time, this
pyramid continues to get bigger and bigger. Just when you think it
can't fracture again, it does.

Even very small businesses can have a large pyramid of corporate
entities that perform many of its important functions. One aspect of
this trend is that companies end up with fewer employees and more
independent contractors. This trend has also created two new words in
business, integrator and complementor. At the top of the pyramid, IBM
is the integrator. As you go down the pyramid, Microsoft, Intel and
the other companies that support IBM are the complementors. However,
each of the complementors is itself an integrator for the
complementors underneath it.

This has several implications, the first of which is that we are now
getting false readings on the economy. People who used to be
employees are now independent contractors launching their own
businesses. There are many people working whose work is not listed as
a job. As a result, the economy is perking along better than the
numbers are telling us.

Outsourcing also confused the numbers. Suppose a company like General
Motors decides to outsource all its employee cafeteria functions to
Marriott (which it did). It lays-off hundreds of cafeteria workers,
who then get hired right back by Marriott. The only thing that has
changed is that these people work for Marriott rather than GM. Yet,
the media headlines will scream that America has lost more
manufacturing jobs. All that really happened is that these workers
are now reclassified as service workers. So the old way of counting
jobs contributes to false economic readings. As yet, we haven't
figured out how to make the numbers catch up with the changing
realities of the business world.

Another implication of this massive restructuring is that because
companies are getting rid of units and people that used to work for
them, the entity is smaller. As the companies get smaller and more
efficient, revenues are going down but profits are going up. As a
result, the old notion that revenues are up and we're doing great
isn't always the case anymore. Companies are getting smaller but are
becoming more efficient and profitable in the process.


IMPLICATIONS OF THE FOUR TRANSFORMATIONS


1. The War in Iraq

In some ways, the war is going very well. Afghanistan and Iraq have
the beginnings of a modern government, which is a huge step forward.
The Saudis are starting to talk about some good things, while Egypt
and Lebanon are beginning to move in a good direction. A series of
revolutions have taken place in countries like Ukraine and Georgia.

There will be more of these revolutions for an interesting reason. In
every revolution, there comes a point where the dictator turns to the
general and says, Fire into the crowd. If the general fires into the
crowd, it stops the revolution. If the general says No, the
revolution continues. Increasingly, the generals are saying No
because their kids are in the crowd.

Thanks to TV and the Internet, the average 18-year old outside the
U.S. is very savvy about what is going on in the world, especially in
terms of popular culture. There is a huge global consciousness, and
young people around the world want to be a part of it. It is
increasingly apparent to them that the miserable government where
they live is the only thing standing in their way. More and more, it
is the well-educated kids, the children of the generals and the
elite, who are leading the revolutions.

At the same time, not all is well with the war. The level of violence
in Iraq is much worse and doesn't appear to be improving. It's
possible that we're asking too much of Islam all at one time. We're
trying to jolt them from the 7th century to the 21st century all at
once, which may be further than they can go. They might make it and
they might not.

Nobody knows for sure. The point is, we don't know how the war will
turn out. Anyone who says they know is just guessing. The real place
to watch is Iran. If they actually obtain nuclear weapons it will be
a terrible situation. There are two ways to deal with it. The first
is a military strike, which will be very difficult. The Iranians have
dispersed their nuclear development facilities and put them
underground. The U.S. has nuclear weapons that can go under the earth
and take out those facilities, but we don't want to do that.

The other way is to separate the radical mullahs from the government,
which is the most likely course of action. Seventy percent of the
Iranian population is under 30. They are Moslem but not Arab. They
are mostly pro-Western. Many experts think the U.S. should have dealt
with Iran before going to war with Iraq. The problem isn't so much
the weapons, it's the people who control them. If Iran has a moderate
government, the weapons become less of a concern.

We don't know if we will win the war in Iraq. We could lose or win.
What we're looking for is any indicator that Islam is moving into the
21st century and stabilizing.


2. China

It may be that pushing 500 million people from farms and villages
into cities is too much too soon. Although it gets almost no
publicity, China is experiencing hundreds of demonstrations around
the country, which is unprecedented. These are not students in
Tiananmen Square. These are average citizens who are angry with the
government for building chemical plants and polluting the water they
drink and the air they breathe.

The Chinese are a smart and industrious people. They may be able to
pull it off and become a very successful economic and military
superpower. If so, we will have to learn to live with it If they
want to share the responsibility of keeping the world's oil lanes
open, that's a good thing. They currently have eight new nuclear
electric power generators under way and 45 on the books to build.
Soon, they will leave the U.S. way behind in their ability to
generate nuclear power.

What can go wrong with China? For one, you can't move 550 million
people into the cities without major problems. Two, China really
wants Taiwan, not so much for economic reasons, they just want it.
The Chinese know that their system of communism can't survive much
longer in the 21st century. The last thing they want to do before
they morph into some sort of more capitalistic government is to take
over Taiwan.

We may wake up one morning and find they have launched an attack on
Taiwan. If so, it will be a mess, both economically and militarily.
The U.S. has committed to the military defense of Taiwan. If China
attacks Taiwan, will we really go to war against them? If the Chinese
generals believe the answer is no, they may attack. If we don't
defend Taiwan, every treaty the U.S. has will be worthless.
Hopefully, China won't do anything stupid.


3. Demographics

Europe and Japan are dying because their populations are aging and
shrinking. These trends can be reversed if the young people start
breeding. However, the birth rates in these areas are so low it will
take two generations to turn things around. No economic model exists
that permits 50 years to turn things around. Some countries are
beginning to offer incentives for people to have bigger families. For
example, Italy is offering tax breaks for having children. However,
it's a lifestyle issue versus a tiny amount of money. Europeans
aren't willing to give up their comfortable lifestyles in order to
have more children.

In general, everyone in Europe just wants it to last a while longer.

Europeans have a real talent for living. They don't want to work very
hard. The average European worker gets 400 more hours of vacation
time per year than Americans. They don't want to work and they don't
want to make any of the changes needed to revive their economies.

The summer after 9/11, France lost 15,000 people in a heat wave. In
August, the country basically shuts down when everyone goes on vacation.

That year, a severe heat wave struck and 15,000 elderly people living
in nursing homes and hospitals died. Their children didn't even leave
the beaches to come back and take care of the bodies. Institutions
had to scramble to find enough refrigeration units to hold the bodies
until people came to claim them. This loss of life was five times
bigger than 9/11 in America, yet it didn't trigger any change in
French society.

When birth rates are so low, it creates a tremendous tax burden on
the young. Under those circumstances, keeping mom and dad alive is
not an attractive option. That's why euthanasia is becoming so
popular in most European countries. The only country that doesn't
permit (and even encourage) euthanasia is Germany, because of all the
baggage from World War II.

The European economy is beginning to fracture. Countries like Italy
are starting to talk about pulling out of the European Union because
it is killing them. When things get bad economically in Europe, they
tend to get very nasty politically. The canary in the mine is anti-
Semitism.

When it goes up, it means trouble is coming. Current levels of anti-
Semitism are higher than ever.

Germany won't launch another war, but Europe will likely get
shabbier, more dangerous and less pleasant to live in. Japan has a
birth rate of 1.3 and has no intention of bringing in immigrants. By
2020, one out of every five Japanese will be 70 years old. Property
values in Japan have dropped every year for the past 14 years. The
country is simply shutting down. In the U.S. we also have an aging
population. Boomers are starting to retire at a massive rate. These
retirements will have several major impacts:

Possible massive sell off of large four-bedroom houses and a movement
to condos.

An enormous drain on the treasury. Boomers vote, and they want their
benefits, even if it means putting a crushing tax burden on their
kids to get them. Social Security will be a huge problem. As this
generation ages, it will start to drain the system. We are the only
country in the world where there are no age limits on medical
procedures. An enormous drain on the health care system. This will
also increase the tax burden on the young, which will cause them to
delay marriage and having families, which will drive down the birth
rate even further.

Although scary, these demographics also present enormous
opportunities for products and services tailored to aging
populations. There will be tremendous demand for caring for older
people, especially those who don't need nursing homes but need some
level of care. Some people will have a business where they take care
of three or four people in their homes. The demand for that type of
service and for products to physically care for aging people will be
huge.

Make sure the demographics of your business are attuned to where the
action is. For example, you don't want to be a baby food company in
Europe or Japan. Demographics are much underrated as an indicator of
where the opportunities are. Businesses need customers. Go where the
customers are.


4. Restructuring of American Business

The restructuring of American business means we are coming to the end
of the age of the employer and employee. With all this fracturing of
businesses into different and smaller units, employers can't
guarantee jobs anymore because they don't know what their companies
will look like next year. Everyone is on their way to becoming an
independent contractor.

The new workforce contract will be: Show up at the my office five
days a week and do what I want you to do, but you handle your own
insurance, benefits, health care and everything else. Husbands and
wives are becoming economic units. They take different jobs and work
different shifts depending on where they are in their careers and
families. They make tradeoffs to put together a compensation package
to take care of the family.

This used to happen only with highly educated professionals with high
incomes. Now it is happening at the level of the factory floor worker.

Couples at all levels are designing their compensation packages based
on their individual needs. The only way this can work is if
everything is portable and flexible, which requires a huge shift in
the American economy.

The U.S is in the process of building the world's first 21st century
model economy. The only other countries doing this are U.K. and
Australia. The model is fast, flexible, highly productive and
unstable in that it is always fracturing and re-fracturing. This will
increase the economic gap between the U.S. and everybody else,
especially Europe and Japan.

At the same time, the military gap is increasing. Other than China,
we are the only country that is continuing to put money into their
military. Plus, we are the only military getting on-the-ground
military experience through our war in Iraq. We know which high-tech
weapons are working and which ones aren't. There is almost no one who
can take us on economically or militarily.

There has never been a superpower in this position before. On the one
hand, this makes the U.S. a magnet for bright and ambitious people.
It also makes us a target. We are becoming one of the last holdouts
of the traditional Judeo-Christian culture. There is no better place
in the world to be in business and raise children The U.S. is by far
the best place to have an idea, form a business and put it into the
marketplace.

We take it for granted, but it isn't as available in other countries
of the world. Ultimately, it's an issue of culture. The only people
who can hurt us are ourselves, by losing our culture. If we give up
our Judeo-Christian culture, we become just like the Europeans.

The culture war is the whole ballgame. If we lose it, there isn't
another America to pull us out.

20 comments:

Anonymous said...

Reagan Administration + CIA = all alarm bells must go off. I do not think that predicting the Soviet collapse is a great accomplishment...

Terry said...

Setting aside the pedigree of the author, what do you think of the substance of the argument especially the issues around demographics?
Its too easy to attack the author personally rather than address the arguments.
Its lazy actually.
Nobody saw the collapse of the Soviet empire. Saying it was inevitable now is an illustration of the hindsight bias laid out in "Black Swans".

Anonymous said...

much better read: http://www.thomaslfriedman.com/bookshelf/the-world-is-flat

Anonymous said...

OK TTT, you ask for it:

Since them, Islam has not found a way to reconcile
with the modern world.
Not true: see --- just one example: Afghan culture pre-Taliban.

First, units of our armed forces are in 30 countries around the world
hunting down terrorist groups and dealing with them. This gets very
little publicity.
Missing: and the US are violating the Geneva Conventions.
Second we are taking military action in Afghanistan and Iraq….to use our military to remove the radicals from power and give the moderates a chance. Our hope is that, over time, the moderates will find a way to bring Islam forward into the 21st century. That's what our involvement in Iraq and Afghanistan is all about.
Not true: The war in Iraq is definitely not “war against terrorism” but “war for natural resources”. Why did the US not intervene during the e.g. Balkan wars?

Most of the instability and horseplay is coming from the Middle East.
Not true: most of the instability comes from the US.

For example, women being brought into the work force and colleges in
Afghanistan is good. The Iraqis stumbling toward a constitution is good.

Unrealistic: Afghanistan is still ruled for a substantial part by Taliban, Iraq is highly unstable.



2. The Emergence of China

If we ever stop buying from China, they will explode politically.
Comment: I can see many Chinese laughing about this. If the US stops buying, China will load off their estimate $800 billion reserves and will make the US economy explode.

China is also thirsty for oil, which is one reason oil is now at $100 a barrel.
Comment: This is such a black and white statement that disqualifies the author automatically. The above is only one little factor among many (OPEC reserves, state ownership of oil reserves, war in Iraq etc,)
We have our Navy fleets protecting the sea lines, specifically the
ability to get the tankers through. It won't be long before the
Chinese have an aircraft carrier sitting in the Persian Gulf as well.
The question is, will their aircraft carrier be pointing in the same
direction as ours or against us?

Comment: The US have a 583 Billion US$ defense budget – China has a US$ 59 billion defense budget. I think that says it all.

3. Shifting Demographics of Western Civilization

The European countries are currently importing Moslems.
Comment: Turks are Moslems and represent the largest group in Germany and The Netherlands (e.g. Germany est. 3 million Turks).
The rest is pretty much true.



4. Restructuring of American Business

I would recommend readings about this topic. E.g. Friedman, Krugman. This section is very light.


IMPLICATIONS OF THE FOUR TRANSFORMATIONS


1. The War in Iraq

In some ways, the war is going very well.
Comment: good joke. See this website: http://zfacts.com/p/447.html. After spending that amount of money and scarifying so many American lifes, the ROI is very low.

The point is, we don't know how the war will turn out. Anyone who says they know is just guessing. The real place to watch is Iran.
Comment: If you have such a high defense budget, you must look for places for future use all the equipment.


We don't know if we will win the war in Iraq. We could lose or win.
What we're looking for is any indicator that Islam is moving into the
21st century and stabilizing.

Comment: any sophistacted and educated analyst would never mix up religion and nations. Haven’t we learned from4 million deaths 70 years ago?

2. China

Hopefully, China won't do anything stupid.
• Comment: Hopefully, the USA won’t do anything stupid.


3. Demographics

• Europeans don’t want to work very hard.
• Euthanasia is becoming so popular in most European countries.
• The European economy is beginning to fracture. Countries like Italy
are starting to talk about pulling out of the European Union because
it is killing them.
• Current levels of anti-Semitism are higher than ever.

Comment: You really can’t expect I take those comments serious?

4. Restructuring of American Business

The restructuring of American business means we are coming to the end
of the age of the employer and employee. With all this fracturing of
businesses into different and smaller units, employers can't
guarantee jobs anymore because they don't know what their companies
will look like next year. Everyone is on their way to becoming an
independent contractor.

Comment: I think he is right but he brings it too extreme. Think there will be a mix.

The U.S is in the process of building the world's first 21st century
model economy. The only other countries doing this are U.K. and
Australia. The model is fast, flexible, highly productive and
unstable in that it is always fracturing and re-fracturing.

Comment: that sounds also true – but not many nuances. E.g.: see The Netherlands as a good example where this is ALREADY happening. So it is not the US…sorry.
There is almost no one who can take us on economically or militarily.
Comment: true for military – not true for economy.


We are becoming one of the last holdouts of the traditional Judeo-Christian culture.
Comment: This is again a joke – right?
here is no better place in the world to be in business and raise children The U.S. is by fa the best place to have an idea, form a business and put it into the marketplace.

Comment: I strongly agree with that.
If we give up our Judeo-Christian culture, we become just like the Europeans.
The culture war is the whole ballgame. If we lose it, there isn't
another America to pull us out.

Comment: I can’t believe what I am reading.

Conclusion:
Interesting read if you want to slip into the mind of a Bush's War Hawks. In one go, he bashes the Europeans as lazy and fat, puts major threats into the Chinese and Muslim directs (esp.Iran) and praises the USA as the only remaining superpoqwer that will survive in the future. Very scary read. Lets all hope this person will never be in charge of anything more than the toilets of the white house.

Anonymous said...

Why did the US not intervene during the e.g. Balkan wars?
Actually it was the US who stopped the Balkan wars. NATO did the job (read US airplane threatening to bomb the serbs into the stone age)
The Balkans war is a sad testimony to the all talk, no action of a Politically Correct EU.

Comment: I can see many Chinese laughing about this. If the US stops buying, China will load off their estimate $800 billion reserves and will make the US economy explode.
The US is China's biggest market by a long shot. If tarrifs are applied to Chinese goods the Chinese economy will grin to a hault.
Production will shift to countries like Vietnam ( this is already happening to a degree.
Chin holds a lot of US debt, but its not likely to cause too much a a ripple if industry shifts back to US shores and the domestic market purchases the goods.
US costs and productivity would easily outstrip China.

Most of the instability and horseplay is coming from the Middle East.
Not true: most of the instability comes from the US.
What a stupid repost. Sryia, Iran...are you their PR agent or something?

The European countries are currently importing Moslems.
Comment: Turks are Moslems and represent the largest group in Germany and The Netherlands (e.g. Germany est. 3 million Turks).
The rest is pretty much true.
I think that's what the guy is saying.......

3. Demographics

• Europeans don’t want to work very hard.
• Euthanasia is becoming so popular in most European countries.
• The European economy is beginning to fracture. Countries like Italy
are starting to talk about pulling out of the European Union because
it is killing them.
• Current levels of anti-Semitism are higher than ever.

Comment: You really can’t expect I take those comments serious?

The 30 hour work week
You can't fire employees who steal from you...
Employees quit and employers have to pay THEM a severence even when threy o to a competitor
Farmers who go on strke and blockade ports when their HUGE subsidies are threatened even though they can still get unprecedented prices for their goods....I won't even begin to comment on the impact the European Agricultural policy has had on the third world.....
The longest holidays in the world...its OK capitalism is bad...we'll just print MORE money
None of the ENGINES of the EU ( read France, Germany and the Netherlands) can stick to their own rules when it comes to deficet budgeting and the EURO.
European economics are a joke.
Why do you think French and German companies make all their money OUTSIDE of the EU.
They don't invest in their home markets...what Multi national in their right mind would??

The point is, we don't know how the war will turn out. Anyone who says they know is just guessing. The real place to watch is Iran.
Comment: If you have such a high defense budget, you must look for places for future use all the equipment.

God you're such a simpleton...read the comment regarding the Balkans.

Comment: that sounds also true – but not many nuances. E.g.: see The Netherlands as a good example where this is ALREADY happening. So it is not the US…sorry.
There is almost no one who can take us on economically or militarily.
The Dutch companies are forced in this direction because employment law in the Netherlands is insane.

Anonymous said...

Actually it was the US who stopped the Balkan wars. NATO did the job (read US airplane threatening to bomb the serbs into the stone age) The Balkans war is a sad testimony to the all talk, no action of a Politically Correct EU.
Not saying that the EU did the right thing either…..

The US is China's biggest market by a long shot. If tariffs are applied to Chinese goods the Chinese economy will grin to a hault. Production will shift to countries like Vietnam ( this is already happening to a degree. Chin holds a lot of US debt, but its not likely to cause too much a ripple if industry shifts back to US shores and the domestic market purchases the goods.US costs and productivity would easily outstrip China.
Wrong: The EU is China’s biggest market. Maybe EU is just as big as the US nowadays. If China unloads the US$ reserves and shifts to other currencies like YEN or EUR -- such action could trigger a dollar crash at a time when the US currency is already breaking down through historic support levels. Even if China just stops buying dollar reserves, how can the US possibly finance its ballooning trade deficit?

What a stupid repost. Syria, Iran...are you their PR agent or something?
Where is the most instable region in the world at the moment and who caused the instability?


The European countries are currently importing Moslems.
Comment: Turks are Moslems and represent the largest group in Germany and The Netherlands (e.g. Germany est. 3 million Turks).
The rest is pretty much true.
I think that's what the guy is saying.......
Right – have you been to Turkey? Do you consider them radical or western?

3. Demographics


The 30 hour work week -- 37.7 EU27 average….
You can't fire employees who steal from you...Simply not true.
Employees quit and employers have to pay THEM a severance even when threy o to a competitor – Simply not true.
EU Member States must avoid excessive budgetary deficits. Under the provisions of the Stability and Growth Pact, they agree to respect two criteria: a deficit-to-GDP ratio of 3% and a debt-to-GDP ratio of 60%. Can’t see what is wrong with that. Compare it with the US deficit! Should we start discussing the seemingly never-ending financial crisis?

Terry said...

Well, well well.
It seems there are people willing to comment on things other than the weather.
I have to weigh in with my two cents worth regarding the EU/employmnet law and the Euro:
Employment laws in EU countries are crazy. Though strictly speaking someone can't steal from you and retain their job, the process of firing someone with cause is extremely difficult, expensive and frustrating. Companies usually take the quick route and pay off the employee.
When it comes to replacing them, they opt to fly folks in to escape a repeat. That's why French companies do their hiring outside the country or have people on short term contracts. Unemployment is high as a result.
The old deficiet financing rules are a bit of a joke.
France and Gemany don't stick to their own rules.
It must be galling for countries like Portugal, who went through huge pain to meet the rules to watch "the big two" discard them when it doesn't suit.
The fact is the US is the biggest economy in the world and if it collapses the worlds economy will go into meltdown.
A low doller is very good for US business and bad for European business. An over valued Euro hurts exports.
Property prices are collapsing in Europe. Spain and Ireland have gone over the cliff. The UK is teetering.
This has nothing to do with the US though many would like to blame it via the sub prime fiasco. The fact is European banks participated enthusiastically.
Europe is heading for a demographic meltdown. The expensive social safety net is being funded by a rapidly shrinking working population.
Surely taxes can't get much higher?
Why work to pay 50+% when you can be unemployed, get free (almost) public transport, have a roof over your head and get a livable "allownace".
The population is getting elderly and as such will cost more and more as people slip into the inevtable health problems which comes from being over 70.
How much more can you tax a dwindling tax base? Gas prices are already the highest in the world through taxation.
There is a problem.
Finally europe does seem to have pretensions of moral superiority. Recent history just doesn't back them up. The first comment wondered why the US didn't intervene in the Balkans. As was pointed out in the second comment it was the US which ended the Wars by flexing its military muscle. Its interesting that Europe talked and talked and talked and did nothing whilst the slaughter went on. THe Balkans were a European problem and it took the Americans to bale them out. Its worth remebering that the US intervention was taken to protect MUSLIMS. This fact is not lost on Bosnians who have named countless streets and city blocks after Clinton.
There are no streets named after Dutch, German or French politcians.
The conduct of the Europeans serving as part of the UN peace keeping forces needs no further mention other than they stood aside and watched the round up of muslim men and boys and turned away as they were massacered.
Both World Wars were European endeavors but the US economic and miltary machines were needed to bring them to a close.
We should be very careful wishing for the US to stay out of world affairs. Whether it be Rawanda, or the Balkans, Europe has shown no evidence they could fill the void.
The dutch and other European countries don't spend much on their military because they don't have too.
If the US exits left and leaves Europe to fight its own battles they will need to in the future.

Anonymous said...

To which Meyer's solution seems to be for Westerners to make love and war. Alarmingly jingoistic piece. There's a whiff of fourth reich about it, i.m.h.o.

American culture? *Snort*

My tuppence on on taxes and property prices will have to wait to another day; after one week's holiday, I can't see over the desk, actually I can't see the desk either: 37.7 hour working week - I wish.

TR-HW

Anonymous said...

And agree someone has to have the capacity to wield the sabre, but should this extend to plunging it to the hilt in countries that essentially are tribal, seemingly without any forethought as to how (if indeed it were possible) to unify thereafter??

TR-HW

Anonymous said...

To bring this back to the normal level of TTT discourse, it's raining No.4's beasts at base camp.

Off to re-read the Meyer world view and fume.

TR-HW

Terry said...

By the way what's TTT mean????

Anonymous said...

TTT = Terry's Travel & Thoughts

Anonymous said...

Lawyer-centric, but a sprinkling of pertinent comments from the Times.

http://business.timesonline.co.uk/tol/business/law/article4465824.ece

For more than 25 years foreign law firms have dominated legal services in China in a determined attempt to mop up their share of the torrents of foreign capital that have flowed into the Middle Kingdom.

The early arrivals headed for Beijing, but, as the market has matured, Shanghai has become the destination of choice as the city races to overtake Hong Kong and Singapore as the region’s commercial and financial hub. It is stamina that counts in this market, not speed.

Two hundred and eight foreign law firms have licences to practice in China. Of these, 29 UK firms have a presence on the ground with representative offices in Beijing (12) and in Shanghai (17), and five of these having established second offices. US firms have almost double the British presence in the People’s Republic of China and Hong Kong-based firms consistently edge UK firms into third place in the league of leading non-domestic players.

How are UK firms fairing? “Competition is robust,” Jon Harris, of Pinsent Masons, says, “but there’s plenty of work to go around and we expect this to continue for as long as China’s economy continues to flourish.”

Historically, foreign direct investment has made up the core workload for most foreign law firms as multinational corporations and the more ambitious small and medium enterprises seek to enter into, consolidate or expand their presence on the mainland. However, changes are afoot. Jane Newman, of Simmons & Simmons, notes that “the market is in transition and the pace of change is speeding up”.

China has so far been insulated from the reverberations of the global credit crunch, but as the nation’s economic growth is largely predicated on exports to Europe and the US, it is only a matter of time before the big squeeze is felt. The effects of this will be exacerbated by the blunting of China’s market edge as it loses some of its advantage as a low-cost manufacturing centre to other countries in the region, such as Vietnam, which are gaining a stuttering momentum of their own.

Long mindful of this, the Chinese Government has been directing the market towards a new phase of development in which more sophisticated business opportunities are emerging. Inbound investment is becoming smarter: multinationals are refining their long-term strategies, life sciences and pharmaceutical companies are eyeing China as a potential location for research and development centres, foreign banks are exploiting the recent liberalisation of banking laws and IT companies look to capitalise on China’s bid to outstrip India as the world’s outsourcing centre.

A sure sign of the maturation of the market is the gradual turning in the direction of capital flows. The expansion of foreign firms' hedge fund practices mirrors the development of the qualified domestic institutional investors regime (which allows Chinese investors to place their money overseas), and the apparently insatiable Chinese appetite for foreign technology and cross-border merger and acquisitions continues unabated. It is in this sector of the market where the more experienced foreign players have the edge over their local counterparts.

Even so, the smart money is betting that it is only a matter of time before the legal market thins out as second and third-tier foreign firms hand back the keys to their trophy offices and return to home base a little wiser. According to Graeme Johnston, managing partner at Herbert Smith’s Shanghai office: “Many foreign firms have entered the market without any clear strategic goals or distinctive commercial offering and as the market becomes more complex there will be a shake-out of those firms that don’t offer real value to clients.”

The local profession, once devastated by the excess of the Cultural Revolution, is consolidating its natural advantages in terms of cultural savvy — never to be underestimated in any emerging market, particularly China’s — and augmenting its skills base through the insight and experience of those Chinese lawyers who have worked for the international players either at home or overseas. They are eagerly lining up their cost advantages and business connections to step into the gap left by those departing foreign firms weary of their continuing losses.

In line with World Trade Organisation commitments, the door to foreign firms remains open. However, in 2006 the Shanghai Lawyers Association issued a menacing memorandum castigating foreign law firms for alleged breaches of practice regulations, specifically, for advising clients on matters of Chinese domestic law. So, the legal market in China is best seen as a marathon, rather than a sprint.

It is those firms with a long-term strategy for providing the high-end services that are out of the technical ambit of most local firms that will endure, but it is set to get lonely for these long-distance runners as they glance over their shoulders to see the local pack fast approaching, rule books in hand.

TR-HW

Anonymous said...

now the lawyers take over - god help us!

Anonymous said...

Trite.
Now the layers take over what?

TR-HW

Anonymous said...

n.b. for "layers" read "lawyers".

Anonymous said...

Hi Terry so Who do you cheer for in the Olimpic Games ?? penny xx

Anonymous said...

Depressing to imagine all these senior execs flying to Davos and listening to this drivel thinking they were learning something. Rubbing shoulders with geniuses like Henry Kissinger at coffee breaks. Then going home and telling their friends what they learned.
No mention that the Iraq war was fought on a bed of lies, that Iraq was a secular state, that Saddam wasn't involved with 9/11 in spite of the best efforts of white house propaganda.No, it is all part of the war of civilizations.
The lunatic settlers of the West Bank, no mention of them. No, they are part of our Judaeo Christian heritage.
And then the Mark Steyn like worry that only the WOGS are having babies,and WE are doomed.
Pathetic really. If only fools like this weren't so close to real power.

Terry said...

well I think this back and forth has run its course.
Thre are worrying issues surrounding demographics in Europe.
Integration of immigrants into European societies needs to be addressed regardless of your perspective. The disaffected in the UK, France and Spain can demonstrate their frustration in rather disconcerting ways, be it by blowing up the underground or commuter trains in Madrid. Blaming Iraqi adventures isn't an acceptable way to explain it away. Whether it be female circumcision, forced marriages, or self imposed isloation, we need to do more to impose our values. There are things which we will always feel to be unacceptable. Its a difficult line to walk embracing different cultures and absorbing the aspects which enrich our society, but drawing the line on practices we feel are fundementally at odds with our values.
I'm not talking about celebrating the Kebab as a contribution to culinary choices when I say this. The tyranny of the politically correct can make any questioning to be viewed as closed minded conservatism. The challange is to separate the rightwing wing-nuts and hidden agendas they may have from a quest for a just and equitable society.
Trying to do no wrong, but strive for social peace is tougher than it sounds.
Terry

Anonymous said...

I gather we're off the soapbox now, but for interest, more from the Times, on the murky world of aerospace, with a Canadian twist... An assault on Shorts will dink the NI economy, I imagine:

The United States is set to clash with the British Government over £155 million in state aid given to the Shorts aerospace factory in Belfast. US trade negotiators have told The Times that they are seeking further information from the Government over the reason for the aid.

Trade lawyers said that this was the first step in a process that could lead to a full trade dispute between the two countries. The Department for Business arranged last month for the aid to be given to Bombardier, the Canadian engineering company, to ensure continued work at the Shorts factory.

This is part of $1 billion (£520 million) raised by Bombardier from the Canadian, Quebec and British governments to help to launch its C-Series aircraft. The US considers launch aid to be illegal and it could challenge the project through the World Trade Organisation (WTO).

The US is Britain's largest trading partner after the European Union and a dispute between the two countries could be embarrassing for the Government and damaging to business.

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The US has long argued that launch aid is an unfair competitive advantage to the companies that receive it. The US has already brought a case to the WTO challenging the billions of euros in launch aid that EU states, including the UK, have given to Airbus over the past 30 years. A decision is expected in that case possibly next month.

Sean M. Spicer, assistant US trade representative, said: “The United States has long expressed concerns about government financial support for the launch of commercial aircraft and has pursued this issue with the Europeans in the WTO. Washington will take a very careful look at the support announced by Canada, Quebec and the UK to ensure they do not distort the market for commercial airliners or contravene WTO rules.”

The $3.4 billion C-Series project will enable Bombardier, which makes the Learjet, to compete with Boeing and Airbus in smaller commercial jets. Bombardier bought Shorts in 1989 and the factory is Northern Ireland's largest manufacturing employer.

A trade lawyer familiar with launch aid disputes said: “The US Government is making inquiries about the nature and terms of the money being provided to Bombardier. If, as seems likely, it is deemed launch aid, the US could take the matter to the WTO.”

A Department for Business spokesman declined to comment. Bombardier said: “Government support for aircraft manufacturing can be expected to attract some international scrutiny. Federal participation in this project is consistent with Canada's WTO obligations.”

The US is not the only government claiming foul play in the aerospace market. The EU has begun its own WTO case against the US claiming that it subsidises Boeing through its military and space budgets.

If the WTO finds that the launch aid provided to Airbus for aircraft such A380 was illegal, the company will have to repay the money and will be unable to receive more.

The UK, France, Germany and Spain are negotiating with Airbus on how much launch aid should be given for its next aircraft, the A350. Airbus is looking for about $1.7 billion in aid.

TR-HW