A STORY: THE GLOBAL ‘OLD MAN’

By Courtenay Barnett

“For too long our leaders have failed us, taking us into one regime change war after the next, leading us into a new Cold War and arms race, costing us trillions of our hard-earned tax payer dollars and countless lives. This insanity must end.”

Congresswoman Tulsi Gabbard of Hawaii

Once upon a time there was a young man; the young man was rich and powerful and over time started to grow old.

In his youth and in his most vibrant days he was rich, attractive to many and his name was well known around the world.

As with many a wealthy and attractive young man, the ladies flocked to him. He was seen to be like an alluring Adonis  to them. Back then he had vigour, vim, vitality and was a most able performer. But, as time went on there were changes in his body and so too in his life; and this made him unhappy. He refused to accept that as with others – one day his time will come and that his youthful days would be  well behind him. So he kept saying to himself, “I am going to make me great again.”

One night Casanova came to him in a dream and explained that it was only natural over time that certain things would rise quite vigorously and same would wane and even fall over time. Not as it used to be when one was young. But, the old man held fast to his youthful ways and with time it seemed that many of his former friends, whose advice he steadfastly chose to ignore, steadily began to lose respect for him.

It remained so for a prolonged period and both friends and foes became significantly upset with his vacuous and vapid ways and so sensibly sought distance from him. It was so bad that even at his advancing age, he bragged one day that all men should just, “Grab them by the p….y”. 

Although he continued to try and row his boat, it did appear he was largely succeeding in going round and round in circles and was not making intelligent decisions  in his latter years. 

The American way

The story, of course,  is a metaphor for events we are all currently witnessing, watching and awaiting a peaceful and promising outcome, if possible. We do desire positive and progressive outcomes  in the best interest of not just the ‘old man’ but for all of us.

What history teaches

The world moves and advances in epochs. Empires rise and empires fall. With each cycle – the ancient Egyptians – the Roman empire – the Persian empire – the Mayan and Aztec empires – the period of Columbus and the Conquistadors – the British empire – and post- British empire – the global empire of the United States of America with some 800 military bases around the world. The greatest wealth the world has ever seen held by a nation state as holder of the world’s reserve currency, the US dollar – but all before have risen and fallen and so too it is expected that the US shall have her day and others shall continue the cycle.

What Trump has not learned

There are certain specifics which the US and all of us might observe and learn from as the major issues prompting a global paradigm shift. For brevity’s sake it can accurately  be said that post World War 11 America became the ascendant global power. Even up to 1991 with the collapse of the then Soviet Union, a golden opportunity was afforded America. This becomes a little personal for me – for I visited Moscow and St. Petersburg in 1992 and saw there the tremendous hardships which the Russian people were suffering at the time. So, what did America do? At the end of the Cold War, America was the lone superpower; Russia was economically very weak; America was singularly strong. Instead of pursuit of peace and lasting global stability, America  expanded weapons production and extended bases into Eastern Europe; caused thousands of US lives to be lost in needless war and over a million in Iraq alone; attacked countries such as the richest on the African continent – Libya ( under Trump’s nemesis – Obama – the not so old man); kept spending some $6 trillion in on-going Middle East wars – and has launched the world, in effect,  into  Cold War II; whilst simultaneously mounting a seemingly impossible task of an ostensibly unrepayable national debt  in the trillions. Old man – really?

What Trump might still yet learn

I believe that there are four(4) central lessons President Trump might learn to steer the US in a more viable direction relative to his domestic concerns as well as those of all the other nations.

1.       Luddites

Abandon the Luddite approach. At and around the time of the Industrial Revolution in England textile workers found themselves displaced by textile machinery. The workers’ answer was to destroy the machinery. In a certain way, the Trump administration is reacting to the shifts in the world economy ( below is a short example) in a similar manner. As the Luddites destroyed the machinery to preserve jobs – so too now Trump through public and foreign policy dictates is making his responses to the challenges of industrialised production as it has shifted overseas; automation; and  computerisation ( as with his response to Huawei) and similarly his regret and/or lack of understanding relative to  new technologies not advancing solely or primarily  in the US. 

Example: In the early 1970s during the Nixon administration, corporate America and the then President made a pragmatic decision. It was recognised in both political and economic terms that China presented an opportunity. By way of rapprochement with China, American influence could extend directly into the Chinese economy.

As an advanced industrialised nation, the US found that parallel to such advancement were US labour laws,  labour Unions, environmental laws, workmen’s compensation, safety laws for manufacturing and such the like which all added cost to the process of production and manufacturing within the US. The solution was found to increase profits for corporations and lower the costs of goods for the consuming American public. This was done by out-sourcing to China and/or having supply chains with China. In a sense ( for a while at least) it was a win-win formula. China received benefits to assist the growth of the Chinese economy while American corporations’ profits increased and likewise there was the attractiveness of the market price for Chinese produced goods sold in America.

However, over time, as the Chinese economy grew there was an expanded Chinese middle class and in turn greater domestic demand for products which China itself could now produce.

So, President Trump, there is both a history and a rational explanation for the process which unfolded over some five decades. If that starting point is considered then the way forward would be more readily seen to be via negotiations within the WTO system.

The WTO to trade is  as  what the UN is to the global political system – a means of averting war  (be that a trade war in one instance – or – as with Iran, an actual threatened military conflagration). So, negotiation and diplomacy become far  more desireable and viable channels for global solutions than endless wars, threats of wars and “obliteration”.

Linked to this idea, is also the role and ever changing role which the US plays in the centre of the world’s financial system.

2.       Financial systems

Two ( 2) points might suffice. 

First, out of the Bretton Woods system came the IMF and World Bank with the US having a head of one institution ( IMF) and from Western Europe the head of the other ( World Bank). That has been the financial architectural structure since the last World War.

Second, America has the benefit of holding the US dollar as the world’s reserve currency.

President Trump ( and if not him then the major advisers of his in the US Government) are aware of a few facts:-

  1. It is Saudi Arabia which has significant oil supplies and at the time Henry Kissinger was Secretary of State and when the US went off the gold standard the replacement was the guarantee that the US would buy Saudi oil; in turn the military-industrial complex would sell American made military hardware to recycle US dollars in abundance. 
  2. The times have changed since the 1953 Iranian coup which was orchestrated by the CIA and Iran has become a significant power player in the Middle East.
  3. If any country elects or at all can wean itself off the US dollar ( e.g. US dollar reserves being reduced by both Russia and China in preference for gold) then over time the dollar weakens and a global power shift
  4. ( as is happening) takes place.

The options to President Trump might not seem immediately obvious so he appears to want to bully Iran into ensuring that they do not move to a dollar alternative option. Same problem again as under Saddam in Iraq; but, Iran is not Iraq – so some  form of negotiated solution has to be found – unless Trump’s decision is to kick off World War 111 and tank the global economy.

3.       Trade and isolationism



The first and second points above serve to explain how the US has arrived at the position it is presently in.



Sanctions on Iran, China, Russia, Japan and who next?

The difficulty is that endless trade sanctions lead nowhere and the parties then end up harming each other and by extension the world economy ( for it is already so economically  intertwined). While President Trump states that he is making trade fair – he is misleading in his pronouncement with China for the tariffs imposed impact the American consumers as well as producers, such as US farmers who pay the price and then have to be subsidised by the US government at the expense of the US tax-payers.

4.       US dollar as world reserve currency and global financial markets

All the foregoing points lead to the cross-roads where other nations in their national self-interest seek to avoid the constraints and stringencies imposed by the US  in the US national interest ( at least in the short-term) which then adversely affects the global economy.

Conclusion

I am not suggesting that the challenges of a shifting global economic and financial paradigm are at all easy. I am saying that the way President Trump is responding to the obvious challenges faced are not evidently rational, carefully thought out and thus over time simply shall not be viable on the trajectory he wishes to take ( dominate) the world economy.

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* COURTENAY BARNETT is a graduate of London University. His areas of study were economics, political science and international law. He has been a practising lawyer for over thirty years, has been arrested for defending his views, has been subjected to death threats, and has argued public interest and human rights cases. He lives and works in the Caribbean.