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National Ratings – What Is The World Coming to?


Examining governance records of selected ten premiere post-WWII governments across the world could throw up some surprises.

Momentum and direction is half the story. The Other Half is more difficult. (Cartoon by Bill Leak; Courtesy - cagle.com). Click for larger image.

Momentum and direction is half the story. The Other Half is more difficult. (Cartoon by Bill Leak; Courtesy - cagle.com). Click for larger image.

Any flavour – as long as it is socialism

With a global recession staring at the world, unemployment at record levels, gold prices in the stratosphere, there is need to understand where nations – and their country-models are going. Communism has failed, Capitalism died with end of African slavery – and in a world made of  socialist flavours, it may be worthwhile to understand what works – and for how long.

Maybe you should read more about भारत-तंत्र Bharat-tantra.

Performance and propaganda

If we are to examine governance records of selected ten premiere post-WWII governments across the world, a lot of State propaganda will stand exposed. To enable a broad understanding of national direction – based on historical milieu, current context and future prospects, a country Rating Engine is available.

10 nations have been chosen. Four from Europe (France, Germany, Italy and UK), two from South America (Argentina and Brazil) Japan and USA, China and India. Looking back at the 65 years after WWII (1945-2010), the context and strategies of these ten countries throws up some surprises.

10 Country Rating Engine

For purposes of this post, a 10-country snapshot has been presented with a Rating Engine. The Rating Engine can be used to measure performance on three parameters.

  1. Relative Decline or Rise From WWII-to Now

  2. Current Status

  3. Country Outlook Over the Next 10-25 Years.

Readers can do a country wise rating on these three parameters, for each country. Cumulative ratings will appear instantly.

USA – the world’s largest economy.

Rise or Decline (1945-2000)
Today
Future

With

  1. 25,000 tons of gold after WWII, now down to 8000-odd tons
  2. Bretton Woods system on its side
  3. World industrial base in shambles,

USA was the supreme power. Without a challenger.

Especially after the atomic bombs in Nagasaki and Hiroshima.

The same USA is a second rate power, mired with wars in Iraq and Afghanistan, battling economic stagnation, with the world’s largest prisoner base.

Run by an intrusive policing system with CIA, FBI, and sundry other agencies that snoop on its own citizen.

The place of the US dollar in the world trade system has been eclipsed.

With a

  1. Huge Welfare State
  2. High levels of crime
  3. Low marital levels
  4. A Big Brother State

the US Govt. employs between 25%-30% of its labour-force.

The largest government in the world, only after China.

Probably.

Britain – The Grand Phuski (or also The Great Damp Squib)

Rise or Decline (1945-2000)
Today
Future

Britain, a victor of WWII, a super-power in its own right, with its mighty industrial base intact, is now a shell of its former self.

Within two decades after loss of Indian raw-material sources and markets, British steel, shipbuilding, automobile, electrical, electronics, coal, railway industries collapsed.

North Sea Oil saved Britain in the 80s and 90s.

British sterling which was the world’s prime currency before WWII, is now not even in reckoning.

North Sea Oil is no longer a buffer or a significant opportunity.

Limited British industrial base is now captured non-British companies (like Tatas from India).

Labour supply managed by high immigrant population is proving difficult to integrate.

With: -

  1. Gross National Debt (Govt, Corporate &Individual) at 500% of GDP
  2. Low marital rates
  3. High imprisonment levels
  4. Bloated Welfare State,

the British economy faces a bleak future.

To this add, the threat of Scottish secession.

Argentina – The Land Of Missed Opportunities

Rise or Decline (1945-2000)
Today
Future

Unaffected by WWII, Argentina, became a major food producer and exporter – especially to UK.

A raw material giant from 1900-1950, Argentina descended into

  1. Military dictatorships
  2. Economic stagnation

to be finally eclipsed by its Latin American neighbour, Brazil.

In the last 20 years, Argentina has seen: –

  1. Mediocre economic performance
  2. Debt default
  3. Bad fiscal position

This makes the current position of Argentina no better than yesterday.

Argentina’s polity has been served by husband-wife teams of Juan and Eva Peron earlier, and now by Nestor and Cristina Kirchner.

With no special economic advantage, Argentina’s struggle for relevance continues.

Argentina’s exports of soybean and corn were significant. Argentina’s industrial and agricultural base give it no special place or advantage.

Inflation (exceeding 100% at times) has been an endemic problem in Argentina for most of the last 60 years.

Brazilian Success – Resounding and Recent

Rise or Decline (1945-2000)
Today
Future

Brazil success built partly on agriculture, raw-material mining, and a BPO sector – and long-term public policy decisions like the use of ethanol instead of petrol for cars.

A freshly minted democracy after years of military rule has stabilized Brazil’s political scene. From 1930-1945, Brazil was ruled by a military junta which was reestablished in 1964, to continue till 1985.

Brazil’s governance model is too recent to merit any credit.

Wealth disparities between the landed and wealthy and the poor, landless, employed or unemployed have been persistent and stubborn.

The ethanol industry has soaked up large amounts of subsidies – and finally may turn out to be a waste, as natural gas seems like a cheaper and feasible alternative.

Brazil’s

  1. Activism in multi-lateral forums
  2. Vibrant agricultural sector
  3. Comfortable foreign exchange position
  4. Smooth transfer of power
  5. Low-risk of war-and-conflict reduces defence burden.

positive points for Brazil’s future.

The French Success Model

Rise or Decline (1945-2000)
Today
Future

French success is based on two very interesting devices. One is the creation of a democratic dictator who can have only one final challenger in the election – till recently, only once in seven years.

The other French innovation was to create a vast public sector economy with government bureaucrats.

 

French private sector is an oligarchy with deep links between French banks and industry and vast subsidies to its agricultural sector.

French auto, aerospace, defence, electronics industries remains competitive and significant.

French fiscal and debt situation while under control is not in the pink of health.

 

French agriculture based on huge subsidies not sustainable.

Managing public sector economy, using a large bureaucracy, with low-levels of entrepreneurial activity with low-cost migrant labour and a Welfare State, is not the most alluring model.

Integration of immigrants into the French society may be an issue

Loser’s Miracle

The three most ‘impressive’ examples of economic resurgence have been the losers of WWII – Germany, Italy and Japan. Significant industrial nations before WWII, it is no co-incidence that these three economies came together on one side to fight WWII – against colonial powers, Britain and France.

The Japanese Miracle

Rise or Decline (1945-2000)
Today
Future

Japan’s airforce in WWII used its own Zero fighters (Mitsubishi A6M1); a significant industrial power by 1920s

Japan’s textile industry was a dominant player in the world from 1920′s-1970s; a major buyer of Indian cotton and exporter of polyester sarees in the 1970′s;

Toyota was a textile machinery firm, Toyoda

 

Japan’s

  1. 20 years of stagnation
  2. Aging population
  3. Uncertain economic outlook
  4. Dependence on exports to USA
  5. Government debt of more than 200% of GDP
  6. Focus on ‘developed’ markets

makes the Japanese ‘miracle’ questionable

 

With low traction in: –

  1. Emerging economies like India, China, Brazil
  2. In new sectors like software, internet

With an

  1. Aging population
  2. Stagnant markets (like USA and EU) for Japanese exports

Japan’s future seems cloudy – if not bleak.

The Italian Job

Rise or Decline (1945-2000)
Today
Future

Italy, one of the three losers in WWII, built itself with a vibrant private sector based on

  1. Food, wine, luxury items, hi-technology
  2. And a small number of public sector firms.

Inspite of

  1. Frequent changes in coalition governments from 1945-1990, due to unstable coalition politics

 

 

Italy’s vibrant private sector

  1. Hobbled by an over-valued Euro
  2. Compromised by unstable banking

Italian public sector in telecom, heavy engineering, energy,  (like ENI, ENEL, Telecom Italia) does not dominate the economy like in France or Germany.

Few Italian companies make to the Global 500 companies- just about 10.

 

 

The Welfare State in Italy as not as efficient’ as the UK, USA, France or Germany.

The public sector too is weak.

With one large oligarchic Fiat, Italy is rather unique in that the common modern ill of MNC-Government oligarchy seems to be weak in Italy

Italy’s dominance of luxury and design businesses has only France as competition

The Rise and Rise of Germany

Rise or Decline (1945-2000)
Today
Future

Germany’s

  1. Vast & competitive public-sector
  2. Export growth, in spite of an overpaid labour force, an over-valued Euro,

is without parallel in Europe – or anywhere else.

 

It must however be remembered that Germany’s

  1. Security
  2. Political structures
  3. Democracy

was imposed on it after WWII.

German reconstruction was bankrolled by the Marshall Plan – the US aid plan for Europe.

German smooth integration of East Germany is a plus

 

Germany’s technology prowess has consistently outperformed the world, without

  1. Mass slavery
  2. Captive markets,
  3. Colonies
  4. Military plunder
  5. Low cost labour

in 20th century.

Unlike Britain or France.

China – The Jade Garden Blooms Again

Rise or Decline (1945-2000)
Today
Future

Mao’s China has gone through two major famines.

During the Great Leap Forward and the Cultural Revolution.

The Communist Party reinforced control using the Tiananmen Square Suppression.

 

China’s growth based on: –

Favorable yuan-dollar exchange rate; earlier used by Europe, Japan, Asian Tigers to grow.

Low labour costs

At a huge non-apparent costs on environment, health, lifestyle

 

China’s dependence on exports to the US markets, favorable exchange rate, clouds its economic and political outlook.

Can it keep Tibet under its control, using its army?

Can Xinjiang be ‘pacified’?

.

India – What is The Difference

Rise or Decline (1945-2000)
Today
Future

India’s

  1. Top-class entrepreneurs
  2. Competitive economy without a dollar-crutch
  3. Vast agricultural output
  4. Small-sized government
  5. Public sector in retreat
  6. Are clouded by rise of an oligarchy.

 

Peaceful changes in elected governments for more than 60 years is unprecedented for a country close to this size.

Except the USA.

Most importantly, India’s stable social structure based on universal marriage makes it unique among all other countries of the world.

Plus a young population.

 

India’s creation of a

  1. Modern industrial infrastructure
  2. Change in governments,
  3. Market-economy systems (stock and foreign exchange markets)

is without parallel or example in the last 200 years – with its religious, genetic, racial, economic, diversity.

About these ads
  1. Sathish
    August 24, 2011 at 3:15 pm | #1

    Good one.

    Titles are not matching with the contents..
    e.g.Titled: China But, Content is of Germany’s

  2. August 24, 2011 at 3:33 pm | #2

    Sathish – You are right …

    These HTML Tables can be a mess. I tried fixing this for the last 7 days. WordPress does not have a native table-creation editor. Other editors like Google Docs or Live Writer have some bugs. Will try and fix this in the next few days.

    In the meantime, try voting on this Rating Engine.

    TABLE PROBLEMS FIXED

  3. S. Dar
    September 9, 2011 at 8:35 am | #3

    Nice to read especially for new graduates. Most details are facts. Future…what will play out well.. no one can tell. Most diversified and demographically healthy nations are going to be just fine. It is the other ones that will feed a lot of uncertainty to otherwise healthy global economy.

  1. August 28, 2011 at 9:18 am | #1
  2. January 30, 2012 at 6:55 am | #2

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