Martin Wolf, of the Financial Times, refers to India and China as “premature superpowers”, countries that have low living standards but huge economies. Premature or not, he suggests that Britain should give up its permanent seat in the Security Council to India. That is not about to happen, but Wen Jiabao’s defence of the indefensible, namely China’s currency policy, underlines the ineffectiveness of American pressure on the rising power, even as an article in the current issue of Foreign Affairs debates how to deal with a post-nuclear Iran thus looking forward to the US failure to prevent such a denouement. Even more abject is America’s apparent willingness to let Pakistan and the Taliban take over Afghanistan, after having fought a war for over eight years to prevent just such an outcome. (via T N Ninan: The post-Lehman world).
Western stamp of approval
Martin Wolf’s recent post on India would endear him to the FEW (Fragile Egos of Westernized) Urban Indians. He has suggested that India should replace Britain in the UN Security Council.
To the ears of the FEW Urban Indians, whose self-esteem depends on Western approval, Martin Wolf’s words are music. My feeling is that we will hear about this in India for the next 5-15 years. The Urban FEW will see Martin Wolf’s endorsement as vindication of India’s ‘greatness’. It will soon be picked up on the Internet, endlessly tweeted and much chest-thumping will happen.
Without seeing if the UN itself will last or survive. After this Great Recession, will Western and related economies do a double-dip? With the West in debt and with the sword of inflation hanging over their heads, who will exactly fund the UN? (No, I can’t see the logic of India funding the UN – assuming it has the means).
Will the UN last for as long, as it will take India to get this Security Council seat. Will a permanent seat at the Security Council be of any use in a world where the UN will become increasing irrelevant? These dubious clubs depend on victims to approve and finance their own slaughter – and these memberships don’t appeal to India.
Many decades ago, India helped sustain the illusion of British super-power by joining the Commonwealth. Will India rush in to join the OECD? Will India expend energy, goodwill and influence to get a seat at this ‘high table’ – which Manmohan Singh has set his heart on?
I wonder how many Indian newspapers and media houses will flock to Martin Wolf after this post – with lucrative syndication deals?
Fitch cuts Russian debt rating, sparks memories of ’98 crash- International Business-News-The Economic Times
Emerging markets are being battered by the global financial crisis as investors shun assets seen as being riskier. Russia, the world’s largest energy supplier, has spent $210 billion, or more than a third of its currency reserves, supporting the ruble since August, Fitch said.
“The country made a mistake trying to defend the ruble when it was indefensible,” said Nouriel Roubini, the New York University professor who forecast a US recession two years ago, in an interview in Moscow. (via Fitch cuts Russian debt rating, sparks memories of ’98 crash- International Business-News-The Economic Times).
G7 and OECD countries have created a club for themselves, by giving each other unlimited line of credit – while the developing world gets credit based on fast-depreciating dollar/euro foreign exchange reserves. Maybe this needs an inversion.
The OECD and G7 should be asked to pay their purchases. In a new global reserve currency. And the BRICS need to start working on that.