on 2001: Greed the only certainty
It's the time of year for reflection. That's not just
a matter of remembering some events from 2001 in Hong Kong and overseas,
but placing them in a larger historical and geographical perspective.
It's also a time to consider how dramatically situations
can change so that what seemed a given today could somehow become irrelevant
tomorrow. A familiar cycle suddenly ceases and we find ourselves in
That is surely what has happened over the past year to
expectations of a Japanese economic recovery. What used to be merely
a question of ''when'' has become ''if'' and ''how''. The tools of 20th
century economics - Keynesian, monetarist or whatever - are not working.
Has the business cycle once regarded as normal perhaps been superseded?
So do we now have to ask whether the Japanese fate also
awaits other ageing, rich societies - Europe in particular? Is 2001
the year when we began to wake up to the fact that countries with static
or declining workforces and without the drive of youth must inevitably
have minimal economic growth, whatever technological progress is being
Meanwhile, China has joined the World Trade Organisation.
This is widely trumpeted as being of huge significance. But it might
be better to view it as a result of the huge changes in China since
1980 rather than as heralding a further great leap forward in its commercial
relationship with the rest of the world. For sure, great achievements
in low-cost exports have financed broader development.
But it is worth remembering that in the two decades before
1914, Russia was the world's leading exporter of grain, creating external
surpluses that helped rapid industrialisation. There was widespread
expectation in the advanced capitalist world that Russia would - despite
its oppressive and feudal political system - soon catch up with Western
Europe. But war and the inflexibility of that political system led to
Some things do not change, however. One is greed, and
it can become so powerful a force at the highest levels of society as
to undermine the trust on which civilised society depends. I am grateful
to www.prudentbear.com, one of the most insightful Web sites on financial
and economic issues, for drawing my attention to the remarkable parallel
between the affairs of Enron, the 2001 representative piece of financial
failure, and the novel The Way We Are by late 19th century British novelist
The BBC recently adapted the book for television, so providing
a global audience with some historical insights into a world driven
by Wall Street and City of London speculators and financiers for whom
the name of the game is not to create but to divert wealth as much as
possible into a few pockets by all kinds of illusions and heads-I-win-tails-you-lose
Trollope had scams in shares in South American railways.
We have had dotcoms and derivative products which line the pockets of
executives and their investment bankers and other ''professional'' leeches
while bankrupting the company.
The contemporary equivalents of Trollope's cast of fraudsters
and stock manipulators have been given plenty of help in their endeavours
by the media. Is the media guilty, or merely gullible? Celebrity journalism
is evidently one ingredient, a means by which people of moderate achievement
are built into icons of wealth, glamour - or evil, like Osama bin Laden.
Journalism driven by the need to please advertisers has
undercut its role in open, pluralistic societies. Agglomeration helps
that process. I have in front of me a Freedom Forum calendar with this
1959 quote: ''The bigger the information media, the less courage and
freedom they allow.'' Given the Time/Warner AOL-CNN combine's closure
of Hong Kong-based Asiaweek, that is even more relevant now than in
2001 also happens to be the year when the Freedom Forum
closed its Hong Kong office. This closure may be a relief as well as
a disappointment for the head of its Asian operation, Arnold Zeitlin.
Mr Zeitlin has spent decades practising free, fearless and fair journalism
in Asia and preaching this gospel throughout the region. As a bureau
chief and media educator, he has acquired innumerable friends of all
nationalities who trust his judgment and goodwill.
But with the US media's self-censorship, the military
tribunals and imprisonment without trial for foreigners which have come
in the wake of September 11, it is going to be very much harder in future
for Westerners to sell the merits of a free press and habeas corpus
to Asian governments ever ready to justify arbitrary actions on the
basis of national security or communal peace.
Bin Laden has lost his battle in Afghanistan, but he
is winning his war against Western liberal values. Al-Qaeda is being
ousted from the Hindu Kush mountain passes but it will stay deep underground
in the West where we can expect more outrages - while Afghanistan will
probably vanish from world attention as Cambodia has done.
For all that, the episode has left behind questions over
the borders of Central Asia, mostly created by compromises between the
Russian (and later the Soviet), the British and Chinese empires post-1850.
Former Soviet leader Josef Stalin drew the borders of his central Asian
''autonomous'' republics to ensure that each contained large minorities
of a neighbouring, rival ethnic group.
So we should be asking now: should we change these borders
to make states more manageable? Is Afghanistan itself really necessary
any more? Its present shape was designed to make it a Pashtun-dominated
buffer state between a Russia expanding into Central Asia and a Britain
pushing its Indian empire into the hills overlooking the great plains
and the passes through which many had invaded India. With the Russian
retreat, is a buffer state needed? Would not Afghanistan's Tajik and
Uzbek minorities (the core of the warlord gang known as the Northern
Alliance) be better off joining up their lands with those of the Uzbek
and Tajik ex-Soviet states? They have never been offered this option.
Likewise, the Uygurs and other Turkic-speaking Islamic
peoples of Central Asia have never had the option in recent times of
being anything other than a part of China. They were the vast majority
in what is still known to many as Eastern Turkestan until Mao Zedong
undertook massive colonisation by Han Chinese to try to ensure that
Xinjiang (which translates as ''New Territories'') would be perpetually
Sinocised. It is too early to tell whether Beijing will ultimately be
any more successful than Moscow was in installing Russian majorities
in Kazahkstan and elsewhere.
What is not in dispute - because none other than the US
Federal Reserve Board tells us is that the US now owes the rest of the
world a net US$2.6 trillion (HK$20.3 trillion). That just happens to
be three times the amount per head of blighted and broke Argentina and
50 per cent more than the combined debt of all developing countries.
The US can carry on regardless so long as the rest of
us accept these greenbacks now being printed by Federal Reserve chief
Alan Greenspan at the rate of one trillion a year. It is all a matter
of confidence. It's fine while it lasts. At some point it may be tested
by the markets to the point where the rules of the game have to be changed,
just as Argentina has had to change its peso/dollar convertibility rules
recently or as former US president Richard Nixon suddenly ended the
dollar's convertibility into gold in 1971. Remember?