THE BLOG

War Is Coming: What the Politicians Can't and Won't Tell Us

18/09/2013 15:01 BST | Updated 18/11/2013 10:12 GMT

The world is in crisis, but we hardly know it, so inured are we to the twists and turns of geopolitics that are beamed to us from our flatscreens. But events are far more inexorable and terminal than we are led to believe and are rooted in the world which underpins our very existence, that of economics.

A third world war - nuclear or conventional - is a good bet and not far off and, other than to make another cup of tea, nothing can be done to stop the next global convulsion because, as a species, we have failed to think our way out of this trajectory.

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Alberto Forchielli, managing director of Mandarin Capital Partners, puts it in simple terms. His understanding of what makes governments and markets tick lend his words a gravitas of which the likes of George Osborne are incapable. He is refreshingly free of spin which is what is needed when attempting to gauge the gulf between what politicians tell and what financiers know.

'The US is turning into a much more isolationist country and will gradually abandon the Atlantic,' he says. 'It will disengage from the Middle East because the US is becoming self-sufficient in terms of energy. This isolationism, however, will not see the US abandoning the Pacific, because in the region the US fears the growth of China.

'If there is one issue in the US which is absolutely bipartisan, it is the deep desire to contain China.'

Economically or militarily? 'Militarily. If you go to a business meeting in the US concerning China, all they talk about is strategy and war. If you go to a business meeting in Europe, all they talk about is how to get into the Chinese market. Americans have become obsessed with China's military capabilities.'

It is worth remembering that China has been a nuclear state since the early 1960s and is capable of launching warheads throughout most of the world, having devoted substantial resources to increasing its military capabilities (pictured). So with little press fanfare, the US has begun the switch, its next grand theatre of war to be in the East. And the US, without doubt, has the political will, irrespective of who has set up shop in the Oval Office.

'China has become energy dependent and is dependent on the Middle East, which will soon become a China problem. China is equally obsessed with taking control of the south seas, as well as the Strait of Malacca,' says Forchielli.

As ever, the business of America is business as it bolsters its military presence in the Asia-Pacific region. 'There is an anti-Chinese bloc in Asia that includes India, the Philippines, Myanmar and Vietnam. Defence expenditures in that part of the world are going through the roof.'

Geopolitical measures are being remade as we speak, our global fate authored by men unknown who plot this coming era and worry not about who turns up at the ballot box, but rather how best to ensure economic prosperity.

'The financial world doesn't give a shit about the political world,' says Forchielli. 'It goes on its own. Capital moves freely and the politicians are useless idiots who appear every four or five years before disappearing. The financial world has so much money they can buy anyone, anytime, because the money they have is gigantic.'

Our bankers, in case we didn't already know, are a law unto themselves. 'They do what they want. But, unfortunately, the financial world is stupid because they don't have the intelligence or foresight to manage the money they control. They move like herds, like sheep, and overreact, creating tremendous waves. They are not deep enough in their thinking. You see, the money is global, but governments are local. There is no global entity, therefore, that can manage the strength of global finance. Politicians, in light of this, are nothing. They need money from financial institutions to get elected and are at the mercy of these institutions.'

This is the sad truth of the ratking of our political classes whose individual monomanias we will never be rid of.

'Institutions invest in countries, then pull out when they see fit and can ruin economies. The financial world is made up of people disconnected from reality. There are people sitting in New York trying to guess what is going to happen in Sumatra!'

Forchielli tells me there is nothing in the world economy to be optimistic about. 'Global capitalism, by definition, is unstable, because it is unmanageable. But is communism any more stable, is dictatorship stable?

'In today's interconnected world, you cannot hide the wealthy from the poor, not even in China. Resentment runs deep. Therefore, income disparities are atomic bombs planted in society, ready to explode. This is already a huge issue in China, but could yet become an issue in the US.'

But what, if anything, can be done? 'I would like to kill greed. The greed factor in the financial world is revolting and one of the most disruptive elements of human nature. Greed unchecked will provoke revolutions and misery.

'The middle class is disappearing with the globalisation of labour, capital and technology. You don't have a balancing factor anymore. There are just masters and serfs.'

So feudalism has returned? 'Yes, almost,' he laughs, 'the rich are getting richer, and the poor are getting poorer and this is very destabilising.'

The tipping point within any country is when the average citizen becomes terminally skint, but until that time, the socio-political world moves forward apace. 'The US has a great technology base and very favourable demographics. It is very self-sufficient in terms of food and energy. The future is more America than China right now because there are no intractable problems in the US. It could fix its fiscal situation in a blip.

'All the US has to do is to introduce a little bit of gasoline tax, but politically, a tax on gasoline is unproposable owing to the strengthening of the Tea Party.'

The bad news keeps coming, despite what the suits in Westminster bray over the despatch boxes. 'Nobody is really optimistic. In the US, the economy is not really picking up and is not giving signs of great optimism, although it is the only economy that can insulate itself from the rest of the world.'

All in all then, things will get worse before they get... even more worse.

'World growth in 2014 is going to slow down substantially,' concludes Forchielli. 'What's happening here is that the world has become very China dependent because China has become the world's biggest importer. It imports more than the US.'

The conundrum, therefore, for the New Rome and its allies, is how to contain a country upon which the world has become dependent. In any event, a US war machine cranking at full tilt (though it may be imperial overstretch) is a money spinner, as efforts in Iraq, Afghanistan and Syria have proved...

© Jason Holmes 2013 / jantholmes@yahoo.co.uk / @JasonAHolmes

Photograph courtesy of Reuters

For more information, visit: albertoforchielli.com