Globalisation and free trade are the best engines of wealth creation the world has ever seen. There is no more real argument about this. Alternative economic models have been tried, variations on Communism, Nationalism and the like, and they have all failed slowly or failed quickly. Of course, this doesn’t mean that a nation should just throw open its borders and let the entire world in. Trade is complex and short-term competition into a relatively undeveloped economy can have catastrophic effects on some sectors, which translates into people ruined and out of work. That is what trade negotiations in all their intricacy are about.
Some people still cling to old, failed systems from the 20th century. Some people want to go even further back to some mythical pastoral past, as if that could even feed the world’s population never mind raise people out of poverty. What there doesn’t seem to be much debate about is what lies ahead. It has taken recent hikes in the oil price to put future energy supply to the forefront of politics and technological effort. Global Warming certainly didn’t do that. There are other things though. Advances in robotics will probably push the cost of manufacturing down even further, and maybe eliminate the comparative advantage of developing nations. Cheap labour means nothing when that labour isn’t paid anything. The continuing advances in computing will change advanced nations out of all recognition over the coming decades, especially if Artificial Intelligence in the true sense of the word becomes available.
What principles and politics will sustain us in 2025? What should we be doing now?
BT Technology Timeline 2006-2051
2 comments:
You have some interesting opinions.
What is you opinion on the state of the economy given:
Record personal debt;
A property price bubble that is now deflating;
Youngsters unable to buy a house due to a speculative investment frenzy pricing them out of the market;
A consumer slowdown following a spending boom based only on that record debt.
I went to a dinner last week, where an eminent economist went so far as to say that consumer spending in Britain was the difference between our high growth and the lower EU average. He also pointed out that most consumer spending has been on credit, and that this was not likely to continue unless interest rates fell sharply. I am not sure I agree with the last bit. Most booms are followed by troughs while accumulated debts are worked through, so a slowdown does appear likely whatever the Bank does. Given the size of the consumer sector it does not auger will for the overall economy.
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