Thursday, 29 July 2010

Plate Tectonics In The North Atlantic

Is America losing Europe? Forty years ago this would have seemed a silly question. The Cold War was still raging, there was a distinct group of countries that we called ‘The West’, and the US was the acknowledged leader of that group of countries. ‘The Soviet Threat’, as it was seen in the 1970s, was the glue that held together this disparate group.

With the dissolution of the Warsaw Pact, the glue that bonded together the NATO allies of the Cold War itself dissolved. We could argue that it is not at all correct to talk of ‘The West’ nowadays. As the glue weakened, so the edifice of The West has started to crumble. To be replaced by what is an interesting question, one that could be quite important when studying the future of geopolitics.

It could be argued that The West is dividing into two blocks – North America and Europe. Increasingly, the two do not understand each other. One could argue that the war in Iraq highlighted this dissonance, but it also masks the fact that three of the large players in the EU (The UK, Spain, and Poland) were also involved in the invasion. If there were two nations that were not in one camp or the other – classic ‘Boundary States’ in the style of the ‘Clash of Civilisations’ – they would be the UK and Canada.

The UK is quite important to the US. It acts as the chief cheerleader for US policies in the EU, it provides qualified support for American policies at the UN, and the UK can usually be relied upon to provide assistance to the US. This is why the current turn of events over the Lockerbie Bomber are relatively important. The inquiry proposed by the US Senate has no legal status under Scots Law, and there is no a priori reason why Scottish politicians should co-operate with it.

The fuss created by the Senators has, however, opened a can of worms in the UK. If the US Senate is allowed to comment on the inner workings of the British justice system, then some commentators in the UK feel that it is perfectly legitimate to do the same to the US system of justice. Needless to say, from a European perspective, the US system is lacking in a number of areas – an area that highlights how Europe and the US misunderstand each other. The Economist – normally a supporter of the US – published a pretty scathing editorial about the US justice system this week. All of this serves to support the view that Europe and America are drifting apart.

In time, if this is true, and if this trend continues, then an issue will arise that is vital to the interests of Europe or America, and the other side will let that party down. My own feeling is that, some time during this decade, the US will face its very own ‘Suez Moment’. If it does, then the unipolar phase of US history will have passed as it will be evidence of the demise of the American Empire.

© The European Futures Observatory 2010

Saturday, 24 July 2010

Capitalism 4.0

I am one of those people who read the newspapers from the back to the front. First the sports pages, then the business section, then the editorial and comment, and finally onto the news. I don’t know why I do this – I always have. Perhaps this backwards approach best reflects my interests? I have found that I am starting to do the same with books now. I tend to look at the concluding chapters first. If I find the conclusions interesting, then I might read the introductory chapters to frame the conclusion, and then, if still interested, the bulk of the book for the supporting argument.

I was recently killing time in Logan Airport, Boston (USA - not Lincolnshire) when I came across Anatole Kaletsky’s new book ‘Capitalism 4.0’. Mr Kaletsky is one of those writers who immediately has my attention. As I had a bundle of dollars in my pocket, as they are of limited use to me in the UK, and as I had time on my hands, I bought the book. My flight was overnight, so I only read the concluding chapters. They seem to contain something useful, something sufficiently interesting for me to take the book on holiday to examine the full argument.

The main thesis of the book is that something substantial has occurred in the recent financial crisis. We call it ‘The End Of The Washington Consensus’. The timing of this event varies between commentators. Those in the US date it at the collapse of Lehman Brothers, those in the UK date it from the nationalisation of Northern Rock. Either way, from that point onwards, things would be different.

What we do not know is how they will be different, and this is the contribution of the book. Mr Kaletsky takes a much longer view of the economy and starts to speculate about what comes next, which is exactly what we, as futurists, have been doing for the past couple of years. This is why we commend the book. It is not a map of the future, but it does serve as a guide into some fairly uncharted territory. If you are of the opinion that ‘back to business as usual’ is not an option, then this book is a good starting point for you.

Book review from The Economist.

© The European Futures Observatory 2010