global hedgeyourmoney
‘authority, rule, political supremacy…’
Huawei has emerged as an unparalleled global leader in the development of 5G networks. It recently overtook Samsung as the world’s largest smartphone maker and became the first Chinese tech company to become globally dominant.
Global power and suprematic control previously the reserve of financial and military might is seeing a transition; the influence of the future will be led technologically — mastery of information in a ‘phygital’ world.
Evolution of hegemony
· In Ancient Greece leadership denoted the politico–military dominance of a city-state upon other city-states.
· In the 19th century hegemony denoted the geopolitical and cultural predominance of one country upon other countries, as in the European colonialism imposed upon the Americas, Africa, Asia, and Australia.
· In the 20th century, the political-science denotation expanded to include cultural imperialism; the cultural domination, by a ruling class, of a socially segregated society.
· The 21st century incarnation further extends ideological values to justify social, political and economic status quo — via readily available funnels such as social media — potentially the most pernicious transfer valve in all of history.
Oft cited and championed by UK PM, Boris Johnson; in 1817 David Ricardo’s developed the classical theory of comparative advantage seeks to explain why countries engage in international trade even when one country’s workers are more efficient at producing every single good than workers in other countries.
Broadly Anglo-American thought has been a huge advocate of a process that has allowed access to a cheap pool of labour to western companies — the key tenet of globalisation.
However…
‘This globalisation framework is being tested as once accommodative neighbours assert themselves to claim dominance in key sectors and industries — usurping the very organisations they were once complicit in helping thrive’
Moreover the pandemic has exposed deep flaws in the pursuit of rampant globalisation; as economies believed to be robust to shocks have crumbled. Previously unfathomable issues such as the inability to produce PPE by developed nations should give rise to considerable pause.
Critical services and products ‘need’ to be produced within each country — these are basic safeguards that ensure a nation is not solely reliant on external aid in times of crisis; precisely the time when relations are likely to become fractured.
Notwithstanding the criticisms, it is clear that free trade, the commerce and innovation it fosters have been central to alleviation of extreme poverty globally. Before the pandemic, UN figures report that 47 countries were on track to halve poverty between 2015 and 2030.
Indeed there is no debate amongst economists that liberalisation of trade has not only reduced poverty but also enriched global peace; as we work with rather than risk aggravating our ‘neighbours’.
‘We in the global community are in danger of forgetting the key insight of those great Scottish thinkers, the invisible hand of Adam Smith, and of course David Ricardo’s more subtle but indispensable principle of comparative advantage, which teaches that if countries learn to specialise and exchange then overall wealth will increase and productivity will increase, leading Cobden to conclude that free trade is God’s diplomacy — the only certain way of uniting people in the bonds of peace since the more freely goods cross borders the less likely it is that troops will ever cross borders.’ — Boris Johnson Greenwich Feb 2020
The merits of strong cooperative are not in question; but as Huawei and the recent ensuing degradation in geo-politic relations has exhibited — the path of globalisation is not without limit…
Whether free trade is indeed God’s diplomacy or not;
It’s time to hedgeyourmoney.
guv@fuel.ventures
