Who rules the waves today?


File:Britannia rules the waves IMG 2210.JPG

Foreign aid gives the donor nation the right ask for demand adherence to the donor nation’s ideals and policies doesn’t it?  Isn’t it a rule of parenting that if you live in my house and accept my money you have to follow my rules?  In the last couple of hundred years the world has two world powers that took no money or advice – instead with the power of their currency and their military they dictated policy to other countries.  The first of the dominate powers was England, Great Britain, the United Kingdom; England had an all powerful navy force – Britannia rules the waves so an axiom of power in the 18th and 19th centuries – England also had a vast colonial empire that provided England with natural resources, markets for its goods and fodder for its armies; and England had the pound sterling, the world’s currency.  Alas, it all collapsed and went away, the victim of world wars and a world-wide, anti-colonial, nationalist movement and the advent of a new power. But before it sun finally set on the British Empire, England ruled more than the waves, it controlled policy, law, trade and at times even society  in Africa, the Middle East, Asia, Canada and Australia; any ruler needed the permission of England to do anything except possible to select a wife or order dinner.

After the World War I, the United States gradually assumed much of England’s role in world politics; although the US never had an empire or even a naval equivalency, increasingly throughout the 20th century it had something else – dollars. The dollar replaced the pound and American foreign policy interests replaced English interests – the Soviet Union was the only serious counter-force to American power and the Soviet economy was no match for the American economy.  In the middle of the 20th century it would have been impossible to imagine the United States sliding slowly into relative obscurity with England – margin players trying to protect their self interest, but always beholding to the guy writing the checks.

In the 21st century that is much, much easier to imagine, especially after the last week.  The whole debt ceiling debate has highlighted some of the changes to come; but the politicians in Washington are not thinking about the future or world power and influence – they think only of elections.  Other people were thinking about the future and wondering just what kind of a role the United States would play, especially if it could no longer pay its debts.  By now everyone knows one of those thinking about the issue was Standard & Poor’s and they concluded the country no longer deserved its current perfect debt rating.  Now, S & P made a two trillion dollar error in its calculation, but what is a couple of trillion among friends?  Even with the error, Standard and Poor’s maintain its is right on political if not financial grounds.  The jaded among you may think it is a political statement on the part of a company whose rating have been demonstrated to be for sale – but the world’ financial markets are taking heed.

However, that is not my point – my point is China.  An editorial from the Chinese news agency has said very clearly that China has America’s banker has the right to say somethings – in fact to demand somethings.

‘China, the largest creditor of the world’s sole superpower, has every right now to demand the United States to address its structural debt problems and ensure the safety of China’s dollar assets,’ the English-language commentary said. ‘To cure its addiction to debts, the United States has to re-establish the common sense principle that one should live within its means.’

Soon you will hear the indignant voices of political – they same ones that last month, last year and in the last century – demanded that Egypt, Saudi Arabia, England, the Philippines, Mexico and dozens of other countries change policy to fit our agenda.  “Support us in what we do and say or we won’t support you”  – ask poor old besieged and beleaguered Hosni Mubarak how many times his compliance was required before the check went into the mail.  China as very quietly been buying our bonds and our souls, and now the bill is coming due. Can you hum a verse of China rules the waves?

 

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