Recently by Gary North: Geezer Conservatism: TheAlbatross
"The owl of Minerva flies only at dusk." I came across that phrase many times over 45 years ago, when I was writing my first book, Marx’s Religion of Revolution (1968). (You can download it for free here.) What does it mean? Wikipedia explains.
The nineteenth-century idealist philosopher Georg Wilhelm Friedrich Hegel famously noted that "the owl of Minerva spreads its wings only with the falling of the dusk" – meaning that philosophy comes to understand a historical condition just as it passes away. Philosophy cannot be prescriptive because it understands only in hindsight.
"One more word about giving instruction as to what the world ought to be. Philosophy in any case always comes on the scene too late to give it… When philosophy paints its gloomy picture then a form of life has grown old. It cannot be rejuvenated by the gloomy picture, but only understood. Only when the dusk starts to fall does the owl of Minerva spread its wings and fly." ~ G.W.F. Hegel, Philosophy of Right (1820), "Preface"
Keynesian ideas are dominant in government and academia today. Keynesianism is the owl of Minerva.
Keynesians think there will never be another Great Depression. They have faith in government deficits and central bank inflation. They’re wrong. Those who listen to them will get hammered during the Great Default, when the Federal Reserve ceases to inflate – as it will, either after mass inflation (likely) or hyperinflation.
In contrast, a lot of Tea Party members think the economy will collapse and wipe out everything for decades. They’re equally wrong.
THERE’S GOOD NEWS TONIGHT!"
The radio news commentator Gabriel Heatter used to begin every broadcast with that announcement, beginning in the late 1930s, when news was often bad. I can recall his introduction in the late 1940s, when news was mostly good. He is forgotten today, but he helped change America. An alcoholic, he introduced Americans to Alcoholics Anonymous in a broadcast in April 1939, four years after its founding. For him, withdrawal was very good news. It still is.
This report is about withdrawal and its aftermath.
The world is going through withdrawal. This began in late 1978 in China, when Deng freed up agriculture. That began the withdrawal from Marxist Communism. The USSR followed suit in December of 1991. The withdrawal from Fabian socialism began in earnest in India in the mid-1990s. These events have re-shaped the world. The aftermath has only just begun.
In China and India, the pain has been minimal. That is because the economic effects of the earlier systems created such devastation. Think of the phrase, "I’ve been down so long, it looks like up to me." Think of China today and China in 1973 under Mao. The positive change has been greater than any seen in recorded history, and on a scale that was inconceivable in 1980. Every month, urban living space sufficient to house the population of Philadelphia gets built: 1.5 million people.
From 1945 until today, the American Right has decried Communism and Fabian socialism. Both are dead ideologies today. They have almost no defenders. Inside the elite, they have no defenders outside of English departments. Yet the reality of this overwhelming institutional and ideological victory has failed to register inside the Right.
One of the things which I do not understand is the appalling pessimism within the American Right. I realize that a lot of promoters are cashing in on this pessimism. They get rich by preaching that everything is going to hell in a handbasket. Everything is not going to hell in a handbasket. Communism and Fabian socialism went to hell in a handbasket. Keynesianism is going to hell in a handbasket. Liberty isn’t.
What we are seeing is the greatest triumph of free-market ideas in the history of man. I have lived through it, and I am telling you, we have never seen anything like what we are seeing today. With the collapse of the Soviet Union, and the reversal of socialist economics in China a decade earlier, we have seen the complete failure of the great alternatives institutionally to the free market economy. The only really systematically communist state left in the world is North Korea, and it is visibly the poorest country in Asia.
Around the world, millions of people are entering free markets. China has made the transition from total Communism to energetic mercantilism. China has entered the Keynesian world order. There is a mixture of mercantilism with Keynesianism in the West, so it is not just a Chinese problem. The state-owned enterprises in China are still a burden on the economy, but step-by-step, they will be abandoned. It is already happening.
India has moved from Fabian socialism to something at least resembling a Western economy. There is no question in my mind that this trend is going to continue. India is going to move out of the intellectual orbit of Oxford and Cambridge of the 1930s. It is clearly experiencing massive economic growth. This is not going to be reversed.
When we are talking China and India, we are talking something in the range of 2.5 billion people. In other words, at least 35% of the world’s population has moved out of either Communism or Fabian Socialism into mercantilism. That will continue, and both nations will continue to move in the direction of a much more free-market economy.
India and China have not been able to gain access to capital, because they were either Communist or Fabian socialist for so long. Prior to 1980, they were backward nations. This is changing on a scale so rapid that nothing like it has ever taken place in human history. Hundreds of millions of people have poured out of the villages into the cities, and the cities are providing employment and opportunities on a scale never before imagined.
All of the creativity that is found in any nation with ancient traditions, especially geared to mathematics and scholarship, which the elites of both of those societies have possessed for 1,000 years, is going to unleash an enormous number of technological discoveries. There is going to be invention on a massive scale coming out of both of those nations, but my guess is that India will be the major contributor. We can barely imagine the kinds of inventions that will be made available to the world over the next 20 years. When we are talking over the next 50 years, it really is inconceivable.
It is not just China and India that will provide these discoveries. They will come from all over Asia. I am still pessimistic about Africa. I am getting somewhat more optimistic about Latin America. Western Europe will continue to produce discoveries, but I do not think Western Europe is going to be the main source of these discoveries.
The United States and Canada will continue to crank out all kinds of inventions. The educational systems in both countries are better than in most other countries, and this is going to improve dramatically over the next half-century because of the rise of online education. There is going to be an exodus from the public schools in both nations, and this is going to dramatically increase both the productivity and the self-discipline in both Canada and the United States. Canada has a lot of self-discipline already. Asians have been pouring into the country for three decades.
Those trapped in public schools will fare poorly. This will not be the middle class. Digital education will overwhelm the bureaucratic educational systems in both nations.
Because the coming innovations will be primarily intellectual and technological, they will be made available to the whole world. This will make for greater competition, and therefore it is going to make for much greater wealth for the common man, all over the world.