MEC: Disparity Driven Resentment?

Part Seven of Everything Must Change (Chapters 27 to 30) deals with the equity system. I'm not going into as much detail here as with the prosperity system, but I want to highlight a few key points.

… As we’ve seen, then, the prosperity system produces some insiders who prosper quickly, leaving others farther and farther behind.

As I’ve suggested already, this ever-widening gap between extremely prosperous insiders and intractably poor outsiders produces a kind of double hatred. The poor first envy, then resent, and eventually hate the rich … The rich sense this hatred and respond with fear, which eventually becomes a form of hatred too. (230)

And …

Taken together, these rising international tensions guarantee that the marginalized poor will become more and more resentful, more and more tempted to violence, more and more desperate, while the insiders will become more and more afraid and obsessed with security. (231)

McLaren goes on to give the stats about economic disparity but is resentment building among the poor? What does the rest of the world think of the United States? The Pew Global Attitudes Project has been asking these questions for a few years. In June of 2007, they released a report on people's attitudes in 47 nations from all continents. To graph to the right shows the percentages of people who view America favorably or unfavorably.

What I find telling is that 9 of the 10 nations (excluding the US) with the most favorable opinion (64% and higher) of the US are non-Muslim African nations. Move to the bottom of the list, and 8 of the 10 ten nations with the lowest favorable score (30% and lower) are Muslim or predominately Muslim nations. Germany is tenth from the bottom, and four nations 11-15 from the bottom are from Europe. Poverty does not seem to be the driving factor. Disagreement about religious values appears to drive the most negative numbers with the Muslim world, and diverging views of geopolitics seem to drive the negative numbers in Europe. Yet the poorest non-Muslim nations seem to have the most positive attitudes toward the US.

Later quoting, Ziauddin Saddir and Merryl Wyn Davies's book Why Do People Hate America, McLaren writes:

The US has simply made it too difficult for other people to exist … The US has structured the global economy to perpetually enrich itself and reduce non-Western societies to poverty, “Free markets” is simply a euphemism for free mobility of American capital, unrestrained expansions of American corporations, and free (unidirectional) movement of goods and services from America to the rest of the world. (257-258)

So what do other nations think of foreign corporations operating in their own countries? The second chart to the right presents the data from a July 2007, Pew report that surveyed forty-seven nations on how favorably they view foreign corporations operating in their own country.

Note Africa at the bottom of the list. Excluding Tanzania, all surveyed nations reported 70 % or more of the people saying they thought foreign corporations had a good impact on their country. Now look at Western Europe. Note that the highest rating is Spain at 56%, with most European nations registering less than 50% approval. Eastern Europe has a more favorable view. Despite having several Muslim countries, the Middle East and Asia have most countries reporting 60% or higher favorable views.

If McLaren is right that growing disparity is driving people toward greater resentment and hatred of the US, with its corporations sucking the life out of poor nations, then why is it that the poorest nations have the highest favorable ratings for the United States and have overwhelmingly positive attitudes toward foreign corporations? I submit it is because life is improving in most developing nations and even in the stagnant (or even regressing nations) of Africa. Integration with market economies, of which the US is the largest player, is seen as the greatest hope for prosperity.

Frankly, this view that multinational corporations and trade is the root of all economic evil in emerging nations strikes me as a projection of Western progressivism onto emerging nations. The facts don't substantiate it. It is a form of ideological imperialism every bit as much as the "free markets will solve everything" mantra. There are a lot of problems with trade in the world, but there is much good that is happening as well. The dramatic improvements in life expectancy, infant mortality rates, income, nutrition, disease elimination, and other variables I highlighted in earlier posts demonstrate this, but McLaren is right that there is far more to do.

Finally, I want to say one more thing about this claim that the US has markets oriented so that all wealth flows to the US. First, a graph linked earlier shows that emerging nations' economies are growing 2 or 3 times faster than the high-income nations. I also pointed out that the bottom quintiles in these emerging nations have the highest percentage of per capita income growth.

With the economic slowdown in the US, economists are now speculating about a "decoupling" of emerging nations from the US. The US economy has been so big in the past that all other economies were inextricably tied to its fortunes. There is some evidence that this linkage is being decoupled. Economist Mark Perry had a post last month called Why Decoupling May Save The World Economy. He included two graphs that he got from an Economist article.

Note how export growth from emerging nations to emerging nations parallels exports to the US until 2006 (though it is always higher.) Two years later, export growth by emerging nations remained at about 20%, while export growth to the US has gone flat. Emerging economies were still growing rapidly, so the new exports must be going to places other than the US.

Over the past couple of years, China has replaced the US as the leading destination of exports by emerging economies. McLaren's claim of a world economy that leads only to the pockets of wealthy Americans may have once been true, but it doesn't seem to hold up under scrutiny today. The world economy is becoming more diversified and web-like.

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Comments

[Steve]

Interesting what the statistics show about China and the USA. I realize that China exports much to the US as almost everything I try to buy comes from China. However, I didn't realize how much China imports from the rest of the emerging economies.That must mean that much of the money we are sending to China for our imports is ending up in the other emerging economies. I wonder what they are purchasing with those funds? Raw materials and comodities?

Great veriety of subjects on your blog.
I spent many of my adolecent years in the Presbyterian Church in Sothern California.

[Michael W. Kruse]

Thanks Steve. Hope your Presby experience was a good one.

As to the global economy, I think it truly is starting to become a decentered network instead of hub-and-wheel model with the US at the center.