The Remarkable Story of China & the Negative Effect of Democracy
So much has been written about China that everyone is aware of this economic miracle.
There is a lot to be said about a central economy that considers economic growth to be important. The largest reason for this economic growth, is the planning and control of the central government.
When the economy needs investment, the government provides it. When capital becomes scarce, the government puts more money in circulation, as it did last year putting $600 billion addition money in circulation. When industry needs more rare earth minerals, the government restricts exports. When more copper is needed, the government makes rules and regulations to ensure that the additional supply is available.
What Western democracies lack, is the ability to make central decisions that are good for the overall economy. Political parties rely on money and contributions. Laws and regulations that affect interested parties are made at a large financial cost.
Some of the examples are obvious.
Rare Earths
The Western world ignored rare earths, because China was supplying so much at such low prices. Strategic Stockpiles were allowed to fall and disappear. Sometimes the economic life of something is limited in the Western World by the need to earn short term profits.
This was the case with rare earth metals, where mines and development projects in the Western world were either abandoned or shelved as a result of low prices.
Now when China reduces its exports to the world, everyone is in trouble. These are probably 30 people in North America that are knowledgeable in this field and they are all of retirement age. The development of these resources will reoccur, yet the economic disruption of these efforts of re-education and re-discovery provides distortions and difficulties.
Oil – The Cost of Imports
Everyone knows that the incredible amount of oil being imported DAILY is very bad for the economy. Everyone knows that we have such immense supplies of natural gas, that the energy problem could be solved in a short time.
Yet year after year, decade after decade, the USA imports enormous amounts of oil at $80 to $90 a barrel plus transportation, storage, shrinkage and other costs, while the market value of our enormous supplies of natural gas continues to fall as there is little demand for natural gas.
The USA imports such a dramatic amount of oil each and every day, that any sensible government would take action to reduce this demand, and to stop this dramatic outflow of US dollars.
The reason for this continuing abuse, is political pressure from companies and industry that spent enormous sums to hire lobbyists and ensure that the government ignores the needs of the people and looks after the needs of the industry.
This would not happen in China.
Belief in Democracy
We in the west are fixed in our belief in democracy and the ability of the people to change governments every 4 or 5 years. This is generally considered to be a good thing. I don’t disagree.
Yet somehow in our entire history we have allowed some groups in our population to wreck enormous economic harm on society, for their own selfish interests.
Whether it is the current oil interests; or the agricultural sector who plant enormous quantities of subsidized corn in order to produce un-needed ethanol, while natural gas is ignored; the defense industry which spends enormous amounts of taxpayers money for their own purposes, all the while claiming it is for the peoples’ interests, and so many other examples.
Historically it was the railroad barons, the steel companies, the telephone monopolies, the robber barons, and so on. It is a common and repeated feature of Western Democracies that the interests of powerful groups always over-ride the interests of the people.
Wouldn’t it be nice to have a level playing field for all of our population and wouldn’t it be nice if our politicians didn’t have to act against the interests of the people in order to get elected
FUND ELECTIONS OUT OF THE PUBLIC PURSE. It has to become the law in order to protect us and let democracies compete on a level playing field with other economies.
