The Myth of Political Leadership
In this dreadful election season, many politicians have promised to "lead us into the future." I can hardly think of a worse fate for any society than to be led into the future by the political class of gangsters, marauders, looters, and liars. Even the most honest and well-intended among them are powerless to improve the world in any way except by diminishing rather than increasing their power.
Politicians haven't the capacity to lead whole societies anywhere. They are outclassed and outrun by trends in the world economy that are beyond the ability of the political class to control or direct. The market economy—globalized, enormously powerful, breathtaking in scope and breadth—is remaking the world in ways that far surpass any existing political development in the US, from the crafted blather of Congressional hearings on this or that to the mad rush to grab the presidential brass rings.
We are living through changes that may appear slow if observed from the point of view of the daily headlines, but which are momentously fast and completely transforming when looked at globally and from the point of view of years and decades into the future.
These developments are going to bring about surprising political shifts, profound upsets in rooted cultural assumptions, and an eventual and merciful end to the
What is the underlying cause? The unleashing of human energies in nations that have been isolated, regimented, and closed for centuries.
This is not only remaking their nations, but the way we perceive the geographical distribution of wealth and power. Over time, and extended far into the future, this trend is going to mean dramatic upheavals in the way Americans perceive their role in the world.
To get a glimpse of the change, take a tour of the local Wal-Mart, the largest company in the world, and take note of the stunning availability of a huge range of consumer goods at very low prices. Note too that such an array would be inconceivable without the work of international trade. From bicycles and electronics to foodstuffs and flowers, we find the shelves dominated by goods that were produced, in part or in whole, by countries outside US borders, and to this we owe the low prices and the quality that accords with US consumer preferences.
The people in these emerging countries, confronted with new economic opportunities, are making the fruits of their labors, assisted by investments by US firms, available to American consumers, driving down prices and driving up the quality of everyday goods and services consumed by Americans. This phenomenon has been the saving grace of the
Now, Wal-Mart isn't on some campaign to become the leading importer; it is only looking to make available to consumers all the things they want at the lowest possible prices. Where they find these goods is outside the
Every retailer in the world is taking notice of this fact, studying the case of Wal-Mart to see how and why it so quickly became the dominant player in the world economy. Its example of seeing both the wholesale and retail market as global in scope—all in the interest of consumer service—has taught the entire business class that nationalism and parochialism are losing propositions. The left may continue to rail against this company, and the right may continue to warn of its dangers to local culture and life, but the example is there for all to see. Average people love this company. It is all old-fashioned consumer service combined with a global reach to bring to average people things that improve their lot in life.
Wal-Mart may eventually go the way of so many companies, displaced by some other firm that knows how to do it even better. The point is the model from which it is working. It is a global model focused on the individual buyer, and it works its wonders by depending on the voluntary decisions of average people. The nation state as such plays no part in its calculus, and this has proven to be the winning ticket. So it will continue to be.
What about the economic impact? Is marketing all these wares to the world a danger? One might be initially alarmed by this, until one considers the savings to the consumer. For every dime saved in consumer prices, one more dime is made available for other pursuits, whether savings, consumption, or investment. It is this fact which is subsidizing American prosperity right now. Far from being a sign that
People who have noted these trends say that we should panic that there won't be any jobs left for Americans to do. What this forgets is the reality of scarcity in the world, which implies that there are always and everywhere jobs to do because there are always and everywhere unmet needs. Specialization and the division of labor permits Americans to produce most efficiently in a way that is integral to world demand and not waste time and resources in jobs that can be done more cheaply elsewhere. This does indeed mean a change in world patterns of production, but the market will manage the change with minimum disruption, as it has for the last several hundred years.
For the developing world, it means something far more dramatic: a nearly complete abandonment of traditional economic pursuits that were imposed on them by virtue of their previous isolation from the capitalist West. The point is not that their economies are free or have been completely unleashed from the chains of the state. The US and
This has unleashed pent-up human energies and made a fantastic difference in the ability of these people to integrate themselves into the worldwide division of labor. This has meant rising incomes, better diets, less starvation, less disease, better sanitation, falling infant mortality, much longer lifespans, and ever more economic opportunities for work and investment. The fate of these economies has two major links to that of American citizens: in their capacity as consumers, they have a strong interest in seeing it continue, and, as investors, many portfolios of US investors are heavily invested in these emerging economies.
The quality of life in these distant lands is increasing in ways that would have been unimaginable even a decade ago, with information technologies made available by the private sector coming into the hands of a new generation that relies on cell phones and high-speed web access, where their parents struggled barely to survive. The lifespan in
Again, this is nothing to regret. A world dominated by a single superpower is a gravely dangerous place, especially when that power is irresponsibly managed (and, some would say, is managed by maniacs). A decline in the power, might, and influence of the
In the meantime, political trends in the
There is a tendency on the part of everyone to judge a historical moment by our own daily affairs and in relation only to the headlines that dominate the news. Economic analysis takes a much broader view to consider the overall impact of billions of people in many lands over a long period of time. It is through examining these trends that we can see that we are entering into a new world of global economic expansion that will rout any attempt to keep it at bay. Now, clearly, this will not occur without periods of crisis, particularly so long as the world is on a dollar standard and governments are still at work bringing calamity wherever they can.
Take a look at where and how the products you use every day are made. Therein lies a remarkable story of the genius of entrepreneurship, the capacity for the world economy to manage itself and overcome ten thousand barriers, and the direction we are headed. It is a world in which consumers and producers from all nations can join hands in praise of the networks that draw them together, and against their common enemy: governments that would stand in the way.
To understand the world being recreated before us, we must constantly keep this principle in our mind: trade based on ownership is always and everywhere mutually beneficial. Within the institution of trade—whether on the most local level or the global level—we find the key to peace, prosperity, and human flourishing. If we understand this, we have no reason to fear our fate except to the extent that anyone anywhere dares to interfere. If we understand this, we can see why being led into the future by the political class is something we should neither desire nor expect.