China is providing two ultimate ironies, the first debunking America's victory over communism and second, the possibility that China's current domestic economic and social model may be a blueprint for a future western world with mass unemployment.
For 45 years America and Western Europe fought a Cold War against communism in which George Bush Sr. declared victory in 1990. The Bush's seem to have a compulsion for premature declarations. China, the biggest communist nation of all, wasn't figured into the victory equation, or was it's growing economic power.
Indeed, China emerged from the Cold War stronger than it had been during its height. And today it has reached a socio-economic compromise allowing it to get rich from western capitalism while maintaining its communist political structure. This may be a master plan for a possible western world to come.
What PM David Cameron and President Obama won't tell their populations is that things probably aren't going to get too much better economically (there's a good chance they will eventually get worse) at least until western nations can make goods as cheaply as eastern nations. But even that may be short-term to what could happen way down the road.
History teaches that decadent nations don't make comebacks. The real world isn't Hollywood. For example, the main strength of the Arab world was its stagnant permanence. Arguably the biggest social change there in 1,000 years has been the formation of Al Jazeera Television, something that ironically may be disrupting this stagnation.
So, while the West has flourished, its own greed, avarice and gluttony is destroying it. Yet, if we disappeared tomorrow the Arabs would probably survive as they have for thousands of years... if their societies don't give-in to change.
But what about the distant future? Providing America and Britain are still here and united, what will life be like, first as low wage nations and beyond.
Capitalism has no master or political ideology. It goes where money is to be made and profits are maximised. The only hard and fast use for people is as consumers. As we see, labor forces can be minimized and moved elsewhere in the world to increase production and profits.
You don't have to look further than your local supermarket to see the next step...automation. Thousands of cashier jobs are being lost to automated shopping...shopping that is now being offered online, too.
And these are service sector jobs that were supposed to be immune to global market competition. Yet this is only a visible aspect of the automation boom that may eventually be a greater challenge to the West than cheap Chinese products.
America emerged from WW2 the richest nation with the largest middle class ever recorded. Yet the only reason most Americans had enjoyed such an affluent lifestyle was because they had good jobs... jobs needed to make and service things...jobs so they could afford to buy dinner out at least once a week, a new car every two years and a new home every few years.
But more than this, people have to earn wages to pay taxes that keep a country running. If there are no wages there will be no taxes, just a population existing on welfare, as many people already in the US and UK serve as evidence.
For the US and UK to get back some lost ground means re developing domestic industry and commerce. More than likely this will come from Asians building factories here to keep their goods affordable to local populations.
But, if machines and computers can eventually do most of manual labor more efficiently and cheaply, what will the future be like for the former middle class and the new non working class? What will they do? For capitalism to thrive, they must have money to spend...otherwise they will be surplus to the requirements of the global market and the corporations will have to scale back production.
A lot will depend on the evolution to an automated society and who will control societies and how they are organized. If America and the UK sink into a morass, individual states and former kingdoms, i.e. Scotland, may push for more self-determination, doing deals with other countries for the exclusive benefit of the states in question.
Yet another cure for cheap Chinese imports will be to rebuild national industries as wage free, union free and totally automated. After massive initial investments, this "I Robot" society will produce all people need and then some. Still, no matter which country controls industry, the big question will still be: What will our people do for work?
As for the distant future, a few lucky people will retrain for still available service sector and industrial jobs. The medical sector will be a main employer. But the bulk of the unemployed may find a home in the military. Many people will go back to the land as subsistence farmers.
One of the reasons Rome gained such a large empire was the fact that slavery meant it had no labor problems. But it did have plenty of unemployed young men...they furnished its army and navy with an unlimited number of recruits to conquer and subdue most of the known world at the time.
In America's case, the military will be more defensive in nature, protecting it from foreign invasion on one hand and domestic insurrection on the other...as is the case with so many so called banana republics, US cities will become breweries of dissent and militancy and the military will be needed to maintain order.
Yet, for those not suitable for the military, the voluntary sector will offer a chance to do something meaningful. You see, while political leaders trumpet the need for new industries to create jobs, there simply won't be the economic viability for such investment in the face of high labor costs vs. dollar-a-day Asian economies.
And any new homegrown industries developed in an open world market would soon leave for cheaper production elsewhere or be automated, using at most a skeleton workforce.
America's only long-term prospect would be the creation of a UK style social welfare state and enriching the country via taxation from cash rich corporations and trade while maintaining former workers on state benefits.
And this is where the Chinese model enters the picture. China maintains free enterprise zones such as Hong Kong and Shanghai where capitalism thrives to service the world. These areas house the nation's economic power, Yet, most of the country remains a communist social welfare state, where the needs of the masses are met by the wealth it makes off the non-communist world. While I'm a firm believer in benevolent capitalism, I can't help deducing something such as this may be a serious option for a future world short of labour.
Of course the simplest thing would be to ban automation, from General Motors to Tesco. But in a free capitalist nation that's about as likely as enacting blanket trade barriers against cheap Asian goods in a global economy that all parties and political leaders support..
On the upside, one of the benefits for millions of people would be a lot of free time for budget holidays.
Okay, you can wake up now, it was only a nightmare.
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