Peter Drucker (1919-2005, Austrian-born American management consultant)
Peter F. Drucker is a storied business management consultant (famously known as a consultant for General Motors in the 1940 s) who taught business administration and sociology at Claremont Graduate University in California. He died at the age of 95 in 2005.
Drucker’s management insight reverses the power structure of profit and non-profit enterprises; i.e. management down changes to management up with organization leaders determining direction but employees (knowledge workers) controlling productivity and effectiveness.
“Management Challenges for the 21st Century”, written in 1999, capsulizes Drucker’s view of the world and his management beliefs. He notes that for the first time in recorded history post-industrial nations are demographically becoming older rather than younger.
American, Chinese, Russian, Japanese, Indian, and most European countries’ birth rates are lower than their death rates. There are more people nearing retirement than entering the work force (excepting countries with higher immigration rates that offset low birth rates).
This demographic change profoundly affects the future of modern economies. Drucker argues that retirement age will grow from age 65 to 75. Drucker observes that revenue from consumers’ discretionary spending rather than revenue from gross sales is the hall mark of growth industries.
Drucker explains private corporations need to treat employees like non-profits. They need to treat employees like volunteers by respecting employee abilities and placing them where they can be most productive.
The rise of the knowledge worker and the fall of manual labor changes the way managers manage.
Successful organizations will increasingly value employees as investments (as assets) as they recognize the real cost of employee turnover.
Good managers will continue to be leaders but employee jobs will be based on defined objectives (rather than job descriptions) that can be met by employee placement in jobs that require their specific skills and/or strengths.
Successful organizations will invest in employees by putting them in positions that capitalize on what they are good at or can be trained to be good at. With job placement that utilizes employee’ strengths, successful managers will stay out of the way by enabling rather than directing employee performance.
The manager’s role becomes one of defining organizational objectives, measuring productivity, and changing organization structure based on empowered employee roles.
Education is a critical component of Drucker’s philosophy of management but his approach contradicts the present direction of educational reform that focuses on teacher accountability for educating students in the fundamentals of reading, writing, and arithmetic.
Drucker promotes a Montessori like approach to education. Drucker believes in structuring education based on student interest rather than a set curriculum.
Peter Drucker is an insightful sociologist and guru of American free enterprise. Managers who choose to follow his recommendations increase their odds for success in life, let alone organization management.
There are four plays in New York that please some of the people some of the time but not all the people all the time; i.e. “Network”, “Ink, “Tootsie”, and “All My Sons”. All were excellent Tony Award candidates. All four had something in common. Each exposed moral turpitude; three on a corporate level, and one on a personal level.*
Ayn Rand’s mistaken thought that “Virtue of Selfishness” is a social and economic good is eviscerated by these four plays. They splendidly demonstrate “…Selfishness” is personally, socially, and economically harmful.
“Network” addresses corporate media and its overarching effect on the public’s understanding of the truth. “Ink” is about corporate media and how sensationalism and circulation are a volatile mixture that distorts reality. “Tootsie” is about the personal consequence of lying. And “All My Sons” is about a CEO’s responsibility to the public.
A book titled “Skunk Works” is a paean to “boys with toys” (before recognition of women at work) and corporate greed. Ben Rich is an engineer that worked for Kelly Johnson at Lockheed.
Kelly Johnson headed Lockheed’s famous design team that created the U-2 spy plane, and the famous Black Bird in the 1960’s. Being an engineer, Rich had a detailed understanding of the facts in plane design, but facts are dead things without a good story. Leo Janos is a writer who turns Rich’s facts into tales of Buck Roger’s daring-do, but a failure of corporate morality.
Ironically, Lockheed became the talk of the century in the 1970’s; not for their incredible design work, but for bribery. Italy, West Germany, Japan, Netherlands, and Saudi Arabia are paid $22 million dollars to buy airplanes designed by Lockheed. That American law violation leads to the resignation of the Lockheed board.
“Skunk Works” is an entertaining and enlightening history of military weaponry. It illustrates the difference between a scientific research company and an industrial production company. Different skills are needed for managers of research than managers of production.**
The play “All My Sons” is about a CEO that produces engines for WWII military combat planes in the 1940s. The assembly manager calls his CEO to explain there is a crack in the blocks of twenty (or more) of the engines they manufacture.
The decision is made by the CEO to weld the cracks to make them look complete and unblemished. The planes with those cracked blocks fail, and 21 pilots are killed.
The company is sued. The managing partner who made the call to the
CEO is sent to prison because the CEO denies ever having told the process
manager to conceal the defect. The truth
is revealed many years later. The CEO rationalizes
his action based on a selfish belief that he and his family’s life were more
important than his process partner’s sentence to prison, or the pilot’s lost
lives. Is their a parallel in today’s
In “Skunk Works”, the inefficiency of government is exposed. On the one hand, inefficiency offers more time for deliberative decision; on the other, it impedes productivity and increases cost. Finally, the story opens military competition among nations that leaves only hope that the destructive power of nations will not destroy life on earth.
The last chapters of Rich’s story argue that government bureaucracy gets in the way of military innovation. He argues there is too much oversight and too many regulations increase costs and discourage innovative change.
Of course, the other side of the argument is about what happens when profit becomes more important than honesty or morality. Two Boeing planes, their pilots and passengers are dead as a result of inadequate oversight and what, at best, might be called self-interest.
Boeing 737 Max Malaysia Crash on March 11, 2019 kills 157 people.
The defense industry, like all human
enterprises, has its Bernie Madoffs (the stockbroker maven who stole investment
funds) and Angelo Mozillos (the ex-Coutrywide CEO who paid a fine for his
questionable mortgage lending practices).
Oversight and regulation are essential to
all forms of society because of the nature of humankind. “Network” has the famous line “I’m as mad as hell, and I’m not going
to take this anymore!”
Yes, you will be mad. and yes, we do take it again and again.
*It always comes down to a personal level, but the consequence is magnified by corporate immorality.
**Science and engineer managers rely on worker autonomy. Process managers rely on set rules for assembly line workers that manufacture complex products. It is science and engineering knowledge, more than rules of production, that determine product. But, assembly experience, more than science and engineering knowledge, completes product.
Enrico Moretti (American author, econonomist, and Professor of Economics at the University of CA.)
Enrico Moretti suggests jobs in America have a new geography. As a professor of economics, Moretti notes how technology reshuffles the nature and location of jobs around the world. Great manufacturing cities like Detroit, Pittsburgh, and Chicago are losing jobs in the 21st century. More jobs are moving to places like Seattle, Portland, Silicon Valley, and Austin. Tech employment is creating more jobs away from historic manufacturing hubs.
Manufacturing job losses 1997 to 2012 as a percentage of working age populations.
Manufacturing jobs are declining in American cities. That decline is memorialized in a New York Times magazine; distributed in the May 5, 2019 Sunday paper. The human cost to Lordstown, Ohio, when G.M. closes its Cruze automobile manufacturing plant, is heartbreaking.
In the early years of tech, companies like Apple, Microsoft, and Google chose business locations based on where they wanted to live; not where labor existed.
Moretti suggests new job creators choose city locations based on factors other than manufacturing labor. Moretti suggests University locations have some effect, but decisions made by early entrepreneurs seem serendipitous; more than reasoned. Their initial start-ups may be in any community because their ideas are new. Their technologies are unproven. Their new employees are generally young, inquisitive, college educated, and innovative. If these new job creators attract investor interest, they grow their companies through culturally shared purpose.
Not only is there the multiplier effect of unrelated domesticate services, there are new technology companies that choose the same communities. The culture grows to what Moretti suggests is enough density to attract the best and brightest in the world. Incomes rise for all businesses in that community. Even though these communities become more expensive to live in, they continue to attract tech companies because of the savvy technological depth of the area.
What Moretti notes is that if new tech ideas have legs, innovators locate in the same area. Like germs on a petri dish, they multiply to create a new culture.
Moretti acknowledges foreign manufacturers pay their laborers less but, more ominously, he notes foreign countries are doing a better job of educating workers to more fully embrace technology. That embrace begins in grade school and advances through higher education. China’s, Vietnam’s, India’s, Taiwan’s, and South Korea’s emphasis is on science and mathematics. In the U.S., Moretti cites numerous studies showing the quality of American education, particularly in science and mathematics, is declining.
Moretti notes manufacturing decline is partly based on automation, but more fundamentally on a deteriorating American education system.
Science Curriculum Ranking in the world.
The irony of Moretti’s observation is that many graduates
of American universities are foreign students that are compelled to leave
America when they finish their degrees.
They are unable to remain in America because of America’s restrictive
immigration policies. Adding to government
immigration policy limit is America’s failing education system; not only at a
graduate level, but at the preparatory level of America’s grade and high school
As an economist, Moretti explains the multiplier
effect of companies that choose to operate in the U.S. and world where labor is
best educated; particularly in the field of technology. Additionally, Moretti suggests foreign governments
are proportionately outspending the U.S. in science research and development. America is falling behind and risks its
future as a multi-cultural center and economic power in the world.
Historically, most Americans are immigrants. Moretti is certainly right in arguing America’s education system must improve, but that improvement needs children of parents who are intent on making their lives better.
What is missed by Moretti is that immigration is important to America; not only for the technological elite, but for first-generation immigrants. From that pool of humanity, America became the most successful industrial nation in the world. That prominent position is threatened by America’s current leadership.
Alec Ross (Author, American technology policy expert)
Alec Ross’s book about future industries is founded on
world travel and observation. Ross is an
historian by education. His wide-ranging view of sociological change is from personal
experience with technology and the information-age.
Ross observes social change around the world as a senior adviser to then Secretary of State, Hillary Clinton. His dizzying travels explain how mobile phones connect the world and change economic, political, and social opportunity for both third world, and highly industrialized countries.
Ross’s fundamental argument is that “…Industries of the Future” will be based on information technology. The forefront of that technology rests on software (coding) and human evolution (genetics).
Despite the current nationalist movement in the world, Trump-like government leaders who focus on nationalist independence and existing manufacturing jobs are job destroyers; not creators.
New jobs will not come from expanded labor-intensive manufacturing but from the accumulation and use of data. Ross suggests coding and genetics will determine jobs of the future.
Ross infers creators of code are tomorrow’s laborers. Today, learning how to code is a valuable skill that insures employment through and beyond the 21st century.
Though there is hyperbole in Ross’s suggestion that today’s coders make a high wage of $100,000+ a year, they do make an entry level living wage with vertical mobility. As the market matures, coder’s income will undoubtedly keep pace with expanding economies.
Ross shows how coding opens the door to automating the manufacturing world. Human labor to make things will change to coding labor that ultimately leads to machines building machines.
Artificial Intelligence is common today and will be ubiquitous tomorrow.
The automobile industry is increasingly relying on machine assembly of automobiles. The manufacturing process still requires human supervision, but physical labor will be increasingly code driven.
Numerous examples are noted by Ross. Driving a car is simpler because of A. I. Using GPS maps shorten travel time, gauge traffic congestion, and locate lost devices. The obvious effect of the information-age is reduction in physical labor with employee job change, re-education, and re-employment. This is a tough reality for today’s laborers; particularly those who work hard every day. The rise of A. I. contradicts the industrial age’s moral belief that character is enhanced by hard labor.
The laborer says, “I am not going to lose my job to a machine”. From a production line laborer or steel worker of a certain age, it is a message once said by Luddites in the nineteenth century. In the industrial age Luddites began dismantling machinery that cost their jobs.
Job upheaval is frightening. However, Ross suggests the information-age offers the greatest opportunity for the world since the industrial revolution. President Trump’s populist effort to turn back time creates false hope for many hard working Americans.
Employees in dying professions should be helped by private industry and the government to retrain and embrace inevitable market changes.
What Ross shows is that industrialized nations that choose not react positively; to be proactive to the information age are destined to decline. Ross shows how third world countries in Africa see opportunities that were never seen before because of technology.
With a mobile phone, African men and women have become entrepreneurs because they can communicate with wider circles of influence and support. Their phones become banks for loans and payments; and more importantly, for investment in themselves.
Ross explains another opportunity presented by the information age in farming. As has been known for centuries, farm productivity is improved by appropriate management and use of natural resources and man-made fertilizers. That customization increases the world’s food supply in ways that could only be approximated in the industrial age. Coded farm machines replace day laborer planting, cultivation, and harvesting,
With the advent of automated farm management systems, soil preparation, planting, and harvesting operations can be more precisely customized.
The second fundamental argument in Ross’s book regards genetics. Understanding of genetic science and our ability to manipulate genetic markers is a wild-west opportunity.
In theory, genetic modification can be a threat to the ecology of the earth, a monumental environmental catastrophe.
To Ross, genetic modification is a boon for agricultural and human productivity that will lead the world out of environmental and human crises.
Giant steps have been and are being made in genetic modification of agricultural products. Ross notes reports of crop productivity increases due to disease resistance coming from genetically modified seeds. Ross argues that GMO opponents are wrong in suggesting “natural” agricultural products are any safer than genetically modified food products.
Ross sites reports of GMO foods that show they are equally or more nutritionally beneficial to humankind than non-GMO foods.
Many would agree with Ross’s assessment of the success of GMO production. However, modification of the human genome opens a much higher level of concern.
There are moral and ethical questions raised by science and religion with experimentation on the human genome. On the one hand, it raises the possibility of erasing the diseases of humankind. On the other, there is the fictional account of the “Island of Dr. Moreau”. Both concerns are expressed in the controversy surrounding the 2018 human gene editing in Hong Kong by Dr. He Jiankui, a Chinese researcher.
Dr. He Jiankui (Claims to have conducted the first human genome-editing of a human embryo)
Ross approaches “The Industries of the Future” from a
more historical than scientific perspective.
His book sees great opportunity in information technology, but proof is
largely unborn history. The
technological revolution is not like the industrial revolution because it goes
beyond Newton’s laws and only touches Einstein’s. Ross seems more likely right than wrong but only
the future will tell, and only history will prove it.
Jerry Z. Muller (Author, professor of history at the Catholic University of America)
Muller offers an interesting and insightful defense of capitalism. Jerry Muller’s “Thinking about Capitalism” is
an historical account of economic theory.
Muller explores three economic systems: 1)market, 2)command, and 3)mixed. In his journey through the history of economic systems, market (aka capitalism) shines brightest.
Muller notes that capitalism is pummeled by many anecdotes of history. Muller does not deny the excesses of market economies, but Muller suggests capitalism’s benefits far exceed its detriments.
Adam Smith (1723-1790, Scottish economist)
Muller argues capitalism’s storied failures distort its multifaceted values. In the “Wealth of Nations”, a seminal work on capitalism, Adam Smith clearly explains the value of a capitalist (market) economic system based on self-interest. Muller notes Smith’s term “self-interest” is often misinterpreted by the public as greed.
Smith’s definition of self-interest is founded on virtue; i.e. behavior based on high moral values. However, Self-interest comes in many forms.
One person’s self-interest may be altruistic in helping others to feel better about themselves. Another person’s self-interest may be to increase personal wealth to improve their family’s standard of living. And, self-interest may be associated with greed. The fundamental point is that everyone’s self-interest is a motivation that is ungoverned by an outside force. Self-interest is a part of human nature.
In a broader sense, there is some truth in the economic cliché of “a rising tide lifts all boats”. It reflects Adam Smith’s belief in the “invisible hand” that guides one’s life in a market driven economy. Every individual strives for their own self-interest which offers charity to some, employment to others, and individuated incentive to all.
Thomas Hobbes (1588-1679)
Thomas Hobbes notes that human nature is both good and bad. He tempers Smith’s argument for capitalism by suggesting government is necessary to mitigate self-interest that is harmful to the public.
Smith and Thomas Hobbes (author of “The Leviathan) believe self-interest is a universal human characteristic. Smith addresses self-interest as an enlightened Socratic understanding of virtue. Hobbes is less doctrinaire and implies Socratic virtue is not common in the general population.
Smith argues that capitalism takes the essence of human nature’s natural self-interest to advance civilization. This advance is not a smooth upward curve but an improving trend. Bad things do happen in a capitalist society. Hobbes might agree with Smith but only in the context of “rule of law” that mitigates non-virtuous self-interest.
Edmund Burke (1729-1797, Irish statesman)
Muller does not ignore critics of Adam Smith’s “Wealth of Nations”. Edmund Burke is a noted critic who argues that too many social conventions are sacrificed by disparate self-interests. He argues that the French revolution is a potential consequence of an economy driven by self-interest.
The social structure of France is decimated in the 1789 revolution. History shows “the terror” of the French revolution murdered innocents. On the other hand, it reformed an economy that left many behind. Prior to 1789, only the rich owned land, never went hungry, and inherited wealth. In the 18th century, France’s poor are mired in poverty, often hungry; with little chance for advancement.
Justus Möser (1720-1794, German social theorist)
Muller also cites criticism from Justus Möser , a contemporary of Burke, who believed the rise of capitalism (mercantilism) destroys craftsmanship in local economies. With trade from other parts of the country and world, Möser argues insular communities are harmed by prices of similar products replacing local artisan’s goods.
Möser argues mercantilism destroys the fabric of local communities; foments insecurity and social unrest. Muller, in part, agrees with Möser’s argument. However, Muller notes Möser’s argument is right and wrong.
With less money being spent for one thing, more money is available to buy or invest in other things. What Möser ignores is mercantilism’s benefit to consumers and the local economy. Consumers who buy a product for less money have more money to spend or invest in the local economy.
Möser’s argument is the same concern raised by those who support today’s trade war. Möser is right in suggesting free trade creates insecurity in local markets. It also demands adjustments in labor that harm local artisans, but Muller argues there is a net gain in public good and general welfare with free trade.
Max Weber (1864-1920, German sociologist, philosopher, and political economist)
Muller goes on to explain how a confluence of religion and capitalism benefits society with Max Weber’s melding of Protestant Ethic with the Spirit of Capitalism. Weber makes the idea of living aesthetically and putting aside savings as a prudent way of living life in an uncertain environment. Creating wealth became a religious calling to some.
Joseph Schumpeter (1883-1950, Austrian political economist)
Muller reviews Joseph Schumpeter’s contribution to the theory of capitalism. As a 20th century Harvard Business School professor, Schumpeter lectures on the value of “the invisible hand”. Schumpeter advances the idea of “creative destruction” as a characteristic of capitalism.
Schumpeter outlines the value of entrepreneurs who pursue new ideas, new products, and innovation that replaces dying industries. He trumpets the growth of capitalism as an engine that perpetuates societal benefit. Some argue that today’s American governance discourages new ideas by dwelling on manufacturing at the expense of technological innovation and change.
Muller examines the other two economic systems; i.e. 2) command, and 3) mixed systems. Muller implies they fail to meet the historical successes of market capitalism. A command economic system is autocratic with primary economic decisions made by one ruling agency—like Mao’s communist party, Hitler’s Third Reich, and Stalin’s Great Turn.
Short term economic benefit of a command system economy hugely disrupts society. Economic improvement is evident in the short term, but momentum is lost as the gap between haves and have-nots grows.
In a command economy, the cult of personality takes over and image becomes more important than substance; i.e. who you know becomes more important than productivity.
Muller implies mixed economic systems are a work in progress. They are represented by leaders like President Xi in China, and President Putin in Russia.
Xi and Putin retain the concept of communist control of the economy but combine command economics with “Smithian” capitalist ideals.
China’s mixed economic policy began with Deng Xiaoping, but Xi expands its reach.
Both China and Russia have shown economic improvement in the late 20th and early 21st century. Xi’s “Road and Belt” plan is part of a command economy, but it relies on the capitalist market principle of influencing trade between nation-states. China’s long-term success remains to be seen. Whether it will be a more effective form of economic improvement than Adam Smith’s market-based formula is left to history.
Russia, like Xi, uses capitalist influence to grow its economy. Russia, in contrast to China, uses its natural resources (oil distribution), rather than a “Road and Belt” policy to expand its influence.
Fundamentally, Muller infers no modern economic system is better than capitalism. One draws that inference by Muller’s cogent explanation of the value of capitalist self-interest. Because Adam Smith’s concept of self-interest is an inborn characteristic of human nature, it will prevail over any economic system that requires command control.
America has been a successful capitalist country in great part because of checks and balances that mitigate command control qualities of mixed economies. Hobbes assessment of human nature demands some level of command control; even in a capitalist economy.
One might argue that America’s avoidance of near economic collapse in 2008 is evidence of the importance of a mixed economic theory. (Interestingly, a December 18, 2018 “…Economist” article, published under the Schumpeter byline, notes that China’s communist party control of businesses during Trump’s trade war have fared better than private businesses.)
It seems time today to read Thomas Paine’s “Rights of Man”. Though his primary purpose is to refute Edmund Burke’s condemnation of the 1789 French revolution, his observations on British Aristocracy are the essence of today’s American “moneyocracy”.
Though President Trump is not the originator of American “moneyocracy”, he is its quintessential representative.
In spite of recent mass murders by demented Americans, Trump insists on giving voice to the NRA’s belief in an American right to buy automatic weapons designed only to kill people.
It takes money to run a campaign for public office. Trump, like most politicians, panders to lobbyist’ and business’ interests that distort the American electoral process.
Beginning with congress’s approval of tax reform, America’s ballooning deficit is a direct consequence of a mistaken belief that “a rising tide lifts all boats”. Contrary to the tired refrain “jobs, jobs, jobs” to make “America Great Again”, the current administration is setting the table for the world’s next economic crises.
The “Occupy Wall Street” demonstrations are an amorphous scream of disgust by an educated population that resents American “moneyocracy’s” control of the economy, elected representatives, the election system, and the “Rights of Man”. “Moneyocracy” is an inheritable line of an American aristocracy.
Instead of 18th century Aristocratic control of British government, 21st century America substitutes the wealth of individuals and corporations (classified as individuals) to control American Democracy. This is not a partisan issue in America.
Every President, Republican or Democratic, has sided with corporate interests in this era of corporate largess. The world is in a state of economic upheaval that is fueled by technology. That economic upheaval is not adequately addressed by corporate America. The government continues to subsidize yesterday’s economy at the expense of middle and lower income citizens.
Management executives that are employees of corporate America take salaries 50 times or more than salaries of their average employee.
The new controller of our economy, the primary interest group of elected representatives, and the master of the American election system is corporate America.
Wealth is the new hereditary right of succession. Corporate America is the thief and ruler of inherent “Rights of Man”.
Once individual compensation reaches beyond rationality, money becomes fuel to maintain America’s “Moneyocracy”, the new hereditary right of succession.
The controller of our economy and political representation is corporate America.
The primary interest group of elected representatives, the master of the American election system, and ultimately, the thief and ruler of inherent “Rights of Man” are corporations and the super-rich. Of course, the rich have always been in control of American government. However, now the rich are not just singular individuals. They are corporations classified as individuals.
The Supreme Court in “Citizens United v Federal Election Commission” in 2010 rules that corporations are individuals.
The Supreme Court’s unwise decision based on freedom of speech identifies corporations as persons. With that nose in Democracy’s tent, corporations could offer millions of dollars to election campaigns. What human being cannot be influenced by such largess? Excessive executive compensation perpetuates “moneyocracy”, but corporate influence is the cause of the loss of the “Rights of Man”.
Tax change is a smoke screen that obscures the real danger of American decline in the 21st century. It is too blunt an instrument to bludgeon the rich. It smacks of false patriarchy and jingoist rhetoric.
American history shows that Americans believe that hard work is the source of success but being American does not guarantee a free ride. Equal opportunity is where America fails.
Education, anti-discrimination legislation, and equality of opportunity have to be strengthened. Corporate America needs to step up. Corporations need to quit wasting money influencing legislators and invest in human rights.
Corporations need to subsidize education by re-training their employees to meet changes wrought by technology.
Corporations must insist on equal treatment of employees, by gender and/or ethnicity. The government needs to re-enforce equal opportunity for all.
America needs to return to the ideals of equal opportunity by allowing entrepreneurs to create wealth through human productivity. Money is not an end but it has become an end that has no end; i.e. high salaries perpetuate themselves through an Aristocratic “moneyocracy”. If one says they make a $1,000,000 a year they are saying they are better then someone who makes $10,000 or $100,000 a year. Salaried compensation is perceived as human value.
Denying salaries that exceed 50 times average employee compensation is not denying the creation of wealth. Entrepreneurs that create productive companies that grow to multi-billion dollar enterprises have opportunity to become billionaires; not from salaries, but from building human productivity that creates wealth.
“Occupy Wall Street” is an unlikely precursor of another American Revolution; however, it may be a symptom of an American cancer that debilitates productive life without killing the patient. “Occupying Wall Street” is not a hippie “sit in” but a plea for reform of American “moneycracy” just as Thomas Paine’s “Rights of Man” was a plea for reform of Aristocratic inheritance.
Martin Jacques has written an interesting book about China’s rise as a world economic power. His overview of the geo-political and Realpolitik relationships of the east and west are interesting; particularly in light of the Trump administration.
“When China Rules the World” has interesting details that inform but do not convince one that China will rule the world. The provocative title drives the bus but it does not reach its destination.
World control is a myth that causes wars and destroys the best and brightest, as well as the mean and maniacal.
What is happening in China is remarkable. China’s transition from Maoist communism to capitalist communism is a caterpillar turning into a butterfly; i.e. China has grown wings but it still lives in a world constrained by its environment.
Though President Xi is re-instituting some Maoist mistakes, China’s world wide investment in infrastructure is based on capitalist beliefs. Xi has an internationalist focus, just like that which made America great; at least, until Trump’s Presidency.
Chairman Mao’s cultural revolution and belief in enlarging collectivist ideology nearly destroys China’s path to prosperity
Xi is attempting to open new markets by financing infrastructure improvements in African, Middle Eastern, and Asian countries. He is creating customers for Chinese product.
Undoubtedly, Xi is also trying to seduce other nations into belief in Xi’s form of Communism. This is not unlike America’s intent to democratize the world.
Jacques argues that a 90% Han Chinese cultural domination of 1/5th of the world’s population will change the nature of the 21st century. In a limited sense, that is undoubtedly true. However, regardless of the type of government rule, human nature is the same.
Money, power, and prestige, are the primary motivations of humankind. Whether one is Han Chinese, Tibetan, Uighur, Indian, Hispanic, Black, or any singular ethnic group, all humans seek control of money, power, and prestige. These innate drives are the speedometer, brakes, and steering wheels of nation-state’ leaders and followers.
There are dominant factions in every culture that are not necessarily the majority of a culture’s population. Jacques’ early comments suggest China’s 5000 year history reflects a cultural conformity greater than any other country in history while later he acknowledges that the predominant Han population is highly diverse in its beliefs.
Cultural conformity is not the relevant issue; i.e., dominant cultures, whether a majority or minority of an indigenous population, are the game changers of a nation’s history.
Jacques argues that China’s cultural history of familial respect and veneration will have profound affects on the future of world economies. Jacques has a valid point. However, the history of modernization suggests that the fabric of extended filial obligation will be ripped apart in China just as it has in every industrializing nation.
China, just as all modernizing nation-states, will see deterioration of familial bonds.
Human nature is immutable. As an agrarian culture moves to the city and parents are compelled to work for wages, family structure and filial commitment deteriorates.
Of course, capitalism is not the same in China as it is in the western hemisphere. As Jacques reports, major capitalist businesses are state owned in China. They compete in the world market but government support mitigates much of the free enterprise ideal of capitalist economies. However, no nation-state operates as a free enterprise capitalist country; i.e. government has always played a role in capitalist nations. Government subsidy of industrialization is a matter of degree.
It may be that China will change the way industrialized countries compete but global economic domination is no longer possible in a tech savvy world that recognizes knowledge is power and natural resources are limited.
All the world knows how each culture in the world lives. With that knowledge, countries will gravitate to systems of government that serve its dominant culture best. Best is defined as what is most important to the dominant culture in the context of either money, power, or prestige.
Long term, China is facing a tougher road to modernize because of population, environmental degradation, and dwindling natural resources, but their short term prospects look better than most other nations.
As Jacques points out, China’s savings rate is over 20%, with a GDP growth rate 3 times that of America. The cost of dwindling natural resources is more affordable to China than most other modernizing countries. However, all economies are closely tied to each other and a major failure in America or Europe will have great consequence for the world economy which will significantly affect China’s short term advantage.
With a failure of a western countries economy, China’s drive toward modernization will be in danger. That danger is demonstrated today by America’s creation of a trade war with China.
Some argue this burgeoning trade war is hurting the Chinese economy more than the American economy. That may be true in the short term, but the efficacy of trade wars are questionable in the long term; particularly in our internet connected world.
Jacques’ book is worth its purchase price and a consumer’s time because he exposes some of the cultural biases of China that are not widely known. His suggestion that discrimination is as prevalent in China as it is in the United States is reprehensible, and disgustingly familiar. Globalization is real. Human nature is immutable. All mankind travels on the same space ship; i.e. our blue ball. At the very least, China is proving that our environment is fragile and natural resources are finite.