Not With A Bang But A Whimper

Many economic experts and politicians around the world are predicting that this recession, mostly caused by the perfidy and greed of American financial institutions, is marking the end of American dominance. The superpower is becoming quite wimpy. The 27-nation European Union, although suffering through the same financial crisis, is now the world’s largest economy.

The Gulf Arab states have negotiated the largest transfer of wealth in history from oil consumers to oil producers, with the biggest loser being the United States. With their huge piles of euros and dollars, they have become the most important investors in the world.
T. S. Eliot in his poem “The Hollow men” describes graphically the fall of a society: “In this valley of dying stars / In this hollow valley / This broken jaw of our lost kingdoms / In this last of meeting places / We grope together / Sightless…This is the way the world ends / This is the way the world ends / This is the way the world ends / Not with a bang but a whimper.”

If you need a lighter touch, this George Bush story was circulating about three years ago: A British doctor says, “Our medicine is so advanced we can take a kidney out of a man, put it in another man, and have him looking for work in six weeks.” A German doctor says, “That’s nothing, we can take a lung out of one person, put it in another man, and have him looking for work in four weeks.” A Russian doctor says, “Russian medicine is so advanced, we can take half a heart out of one person, put it in another man, and have them both looking for work in two weeks.” The American doctor says, “You guys are way behind. We took a man with no brain out of Texas, put him in the White House, and now half the country is looking for work.”

Heard Anything About Canada Lately?

I have come to depend upon Fareed Zakaria of Newsweek and CNN for truths in the world. Fareed came to this country from India when he was 18, understands the Asian world, and goes around puncturing the balloons of bloviators like George Will and Rush Limbaugh (or as I call him—Trash Limbo). He now has his own program “GPS” on CNN, and he gets big name politicians and diplomats as guests because I think they trust his judgment.

We haven’t heard much of how Canada is affected by the world financial meltdown. Zakaria, in the Feb. 16, 2009 issue of Newsweek, tells us why. All in all, I suppose Corky and I have spent about a year traveling through all the Canadian provinces except Nunavut in the last 15 years, forging more respect for Canadians each time. They have never seemed to be flushed with greed. And most striking, they seemed to be genuinely satisfied with their lives, whether rich or poor.

Zakaria reveals that Canada is the only industrialized country in the world that has not had a bank failure, calls for bailouts, or requests for government help for banks. In 2008, the World Economic Forum ranked America’s banks 40th in the world in financial health. Britain’s banks were even worse than ours, stuck in 44th place. Canada’s banks were ranked #1. Not a single Canadian bank has failed in the last two years. Thirty-eight American banks have been closed by regulators in the same period.

Zakaria describes why Canada did not loosen regulations. The banks thrived on following risk-averse rules, so why change a good thing for transitory profits? Canada does not have a housing crisis because their tax laws do not encourage wild speculation. Mortgage interest is not deductible in Canada, so huge tax breaks are not available. Home prices are down only about 10 percent in Canada now as compared to 25 percent in the U.S. (Phoenix real estate has declined 33.7 percent). Whats more, Canadian homeownership is at 68.4 percent as compared to our 68 percent, so evidently tax deductions do not play a significant role in ownership.

What North American Region Produces The Most Cars?

If one takes a serious look at the Canadian system of accomplishing social order, one can only conclude American politicians—and our public—are brain-dead.

Canada has had 12 straight years of budget surpluses. We have had eight straight years of budget deficits. Canada has strengthened its entire retirement and pension system. Our policies have turned our 401K plans into 210Ks.

Canada has a national health insurance plan which covers everyone but costs only 9.7 percent of GDP. We spend 15.2 percent of GDP for a lousy health program that leaves almost 50 million people without any coverage. You are OK if you make more than $200,000 annually and don’t need million-dollar medical care. If you are below that in earning power you could be in serious trouble. Half of the bankruptcies before the recession were because of medical bills.

American children are twice as likely to die before the age of five as Czech children. American women are 11 times more likely to die in childbirth as Irish women. That’s why Canadians live three years longer than Americans and can expect three more years of “healthy” living.

American car companies have moved so many jobs to Canada because of their national health insurance that Ontario outproduces Michigan in automobiles.

A “Must Read” For A Post-American World

I have been on a Zakaria binge since I read his latest book “The Post-American World” and his Newsweek article on our Afghanistan strategy. According to him we are losing in Afghanistan, but that’s another column. Much of his book was written before our latest financial collapse. He cites many facts that indicate America may be going the way of all arrogant empires before it—whether Roman, Arabic, Islamic, Dutch, or English. Here are just a few highlights:

** He agrees with worldwide fund managers that none of the 25 great multinational companies in the world will be based in the United States within a decade or two. They cite Brazil, Mexico, South Korea, and Taiwan with four each; India with three; China with two; and Argentina, Chile, Malaysia, and South Africa with one each.

** Silly as it seems, countries are enamored of tall buildings and will spend billions to build the tallest in the world. Taipei is the current record holder, but it will soon lose the honor to Dubai.

** The richest man in the world is no longer Bill Gates or Warren Buffet. He is Mexico’s Carlos Slim Helu, whose family owns a lot of almost everything in the country.

** The largest publicly traded company in the world is a Chinese one, just out of the shadows of Communism.

** The world’s biggest plane is built in Russia and the Ukraine.

** The world’s largest oil refinery is now being completed in India.

** The world’s largest factories are now all in China.

** London is rapidly becoming the financial center of the world again, even with the same recession problems we have. The Arabs and Asians prefer London to New York.

** The largest endowed investment fund is now controlled by the United Arab Emirates.

** Singapore has the largest Ferris wheel in the world.

** The number one casino in the world is in Macao, and it has already overtaken Las Vegas in annual gambling revenues.

** India’s Bollywood has overtaken Hollywood as the largest producer of films—and of tickets sold.

** Only one of the top ten shopping malls in the world is in the United States now. The largest mall is in Beijing, China.

It May Be A Choice Of Slim Or None—And Slim Left Town Yesterday.

Zakaria concludes that we may still be able to be a superpower if we do things “right”—whatever that may be—but he says we should learn to work with the world, not against it. Zakaria describes a little bit about Chinese history which is not generally known in this country. It should remind us that other countries are capable of magnificent undertakings.

Eighty-seven years before Christopher Columbus set sail for something out there, a Chinese admiral named Zheng took 317 vessels and 28,000 men, sailed on the waters of the Indian Ocean and around Southeast Asia, and “found” shiploads of treasure.

His largest ships were over 400 feet in length (Columbus had four small “boats” and a total of 150 men) and had nine masts. His smallest ship was a five-mast warship twice as large as a Spanish galleon. Each of Zheng’s ships used up about 300 acres of prime woods. These ships were all built in Nanjing, the world’s largest and most advanced shipbuilding port. In the three years after Zheng’s first sailing, it produced 1,681 ships. Nothing in Europe could match it.

By 1430, a new dynasty was established, and it made a political decision to stop Zheng’s piracy, trade, commerce, and exploration. But this slice of history may be a reminder to us that there are always new stallions, bulls, bucks, and queen bees ready to take over when weakness exists.