Waves of Wealth

I’m often irritated these days when people get into the whole India Vs. China debate or the idea of superpower nations and I could not have put the argument as concisely as Alvin Toffler. I’ve been reading Alvin Toffler’s 2007 book, Revolutionary Wealth.

I’ve still not finished the book and am getting rather bored of its repetitive nature, I did find a few gems though and one of those is what Toffler describes as Waves of Wealth. Discussing history is no simple task but if we think about it in terms of progression we can see that the most important factor in the advancement of mankind has been knowledge; acquiring, continually testing and applying it. I was profoundly struck by his theory that although the competition between rival emerging super economies is narrowing, the methodology used to achieve this is not the same.

Toffler, a futurologist, states that today’s prosperous nations developed into what they are today by following a three-step map. In the first wave, agriculture became the centre of life. Once it was discovered that nature could provide food as required and that a surplus of this product could be kept, a new window for trade had opened up. It also gave rise to various forms of political repression and injustice as a gap emerged between ruling elites and the peasants who worked on the land.

However, the circumstance and perhaps lifestyle were to change as the Industrial age came about. Suddenly even the men that once worked the land were able to learn and operate machinery and possibly given a chance to work in other fields.

The third wave gave rise to the service based economy, which is where we are presently. In the service based economy (the third wave), the first and second waves continue to exist as a parallel economy but the focus and nature of work for most people has changed and given rise to even more roles to be fulfilled. Knowledge is a key component, we use it everyday and we want more of it faster and faster which is where I put forward this idea:

With its very large service based sector, India is clearly riding the third wave. Multinational firms are all taking a slice of the large, cheap and reasonably well trained labor pool. China on the other hand is still following its Maoist form of state control while doubly praising Deng Xiaopeng’s calls for increased financial power. China seems to wielding its power over the world by taking in large manufacturing contracts and providing the benefit of lower costs. There are several issues here however which need to be addressed:

1) China’s rising economy is based on the second wave, a highly developed manufacturing base. Very little to do with actual use of knowledge. Collecting knowledge and having positions available for research and development is far outnumbered in terms of both capital investment and the number of firms showing interest by firms in the manufacturing sector.

2) Rising financial freedom must by some definition try to free itself from the bizarre hybrid mechanism of communist and capitalist ideologies, in other words, people should feel the strain of government control and opt to invest Chinese capital in other countries. Who says “Made In China” is the beginning and the end of it?

3) Are we really happy with these service and manufacturing monopolies? Why doesn’t Africa play some role yet?

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: