Europe is poor so should live within its means

11-02-2012 07:42AM #1

http://www.bbc.co.uk/news/business-16918000
For decades the West has lectured the East on how to manage its economies. Not any more.
Now the emerging economies of Asia look like models of steady, consistent policy and sustained growth while Europe, America and Japan are mired in debt and are growing achingly slowly, if at all.
So what can the West learn from the East?
According to former Malaysian Prime Minister Mahathir Mohamad, the message is simple but devastating: Europe must face up to the new economic reality.

"Europe... has lost a lot of money and therefore you must be poor now relative to the past," he reasons in an interview with BBC World Service's Business Daily.

"And in Asia we live within our means. So when we are poor, we live as poor people. I think that is a lesson that Europe can learn from Asia."

I thought that we were turning Japanese, now we need to turn Malaysian!

DarkJager · 11-02-2012 07:45AM

dolanbaker wrote: »

http://www.bbc.co.uk/news/business-16918000
For decades the West has lectured the East on how to manage its economies. Not any more.
Now the emerging economies of Asia look like models of steady, consistent policy and sustained growth while Europe, America and Japan are mired in debt and are growing achingly slowly, if at all.
So what can the West learn from the East?
According to former Malaysian Prime Minister Mahathir Mohamad, the message is simple but devastating: Europe must face up to the new economic reality.

"Europe... has lost a lot of money and therefore you must be poor now relative to the past," he reasons in an interview with BBC World Service's Business Daily.

"And in Asia we live within our means. So when we are poor, we live as poor people. I think that is a lesson that Europe can learn from Asia."

I thought that we were turning Japanese, now we need to turn Malaysian!

If that's not bad enough, I've just noticed the Euronews voice over guy has serious problems ending sentences with the correct pitch. It's now annoying the absolute **** out of me.

ejmaztec · 11-02-2012 07:59AM

When it starts costing a lot more to produce goods in the Far East, they'll be the ones fucked. Manufacturing will move back to the areas where us paupers live.

ToddyDoody · 11-02-2012 08:06AM

Its a fair article.. Though the comments about europe only really making money by ****ing about with currencies cant be fully correct.. A fair bit of efficient production goes on here.. The automotive industry and germany spring to mind.. Dont think his vision would fly as-is in the states / uk simply due to cultural differences (my opinion, just a hunch) name me a country that underwent an orderly transition to being poor? How is being poor achieved as a goal? (which is essentially what this guy is advocating.. Seems like a defeatist aim)

Sindri · 11-02-2012 08:13AM

I think the thread (no fault of your's OP) and parts of the article are misleadingly sensational, particularly the title. If you read the article he comes across a lot more reasonable but I'd have to question his command of English or if he chose to be intentionally provocative. As a leading Malaysian politician I would suspect he should have quite an exceptional command of English.

bbam · 11-02-2012 08:17AM

ejmaztec wrote: »

When it starts costing a lot more to produce goods in the Far East, they'll be the ones fucked. Manufacturing will move back to the areas where us paupers live.

Nope.
They'll just move production to the last untapped cheap labour market, the African nations.

Sindri · 11-02-2012 08:22AM

bbam wrote: »

Nope.
They'll just move production to the last untapped cheap labour market, the African nations.

Possibly, but Africa does not as yet have the infrastructure. Possibly only the Maghreb, Egypt, Nigeria and South Africa.

I mean look at a map of the continent at night time.

bbam · 11-02-2012 09:00AM

Sindri wrote: »

Possibly, but Africa does not as yet have the infrastructure. Possibly only the Maghreb, Egypt, Nigeria and South Africa.

I mean look at a map of the continent at night time.

Don't worry.
When the wages are near zero, workers have no rights and a corrupt government exists then the infrastructure will appear

Gummy Panda · 11-02-2012 10:23AM

The article basically says Europe should stop relying on its financial sector and stop paying employees so much money in it

NinjaK · 11-02-2012 10:25AM

Europe is poor??! Then what is Africa???!

Sindri · 11-02-2012 10:29AM

NinjaK wrote: »

Europe is poor??! Then what is Africa???!

Indeed. In fact India, I have been informed, has more people living in poverty than the whole African continent.

Pdfile · 11-02-2012 10:34AM

NinjaK wrote: »

Europe is poor??! Then what is Africa???!

poor is only a state of mind as theirs always someone better and worse off then you..

its all about how you use the little/alot ye have...

44leto · 11-02-2012 10:42AM

NinjaK wrote: »

Europe is poor??! Then what is Africa???!

Africa is on the rise, Europe is stagnant and in decline, this is not new in world history, the wealth and world economic centre has always moved.

We are just living through another one, the East is usurping the west, the far East is rapidly becoming the world economic centre, the new west if you like. In 10 to 20 years time Europe will look more like South American economies of the 80s, broke and not much going on.

As for banking, it is a key and powerful industry and a big employer why would you want to forego that and the service sector. It is still an area the west can compete with the East, but they to are building up that sector.

I am not optimistic about the wests future, I think our highly indebted economies speaks volumes, we can no longer support them in the long term, we are just not creating the wealth.

mikemac1 · 11-02-2012 10:46AM

Fine, maybe we'll take back our manufacturing jobs from Malaysia and see what his reaction is

I'd pay a small bit more to support Irish manufacturing, well EU at best

11-02-2012 10:59AM

I think that we'll (re)start basic manufacturing industries here when China cuts the "dollar" umbilical cord.
At the moment, their cheap goods are as a direct result to the dollar peg, when their domestic market is more mature, they'll let the Yuan float.

End of cheap Chinese stuff, it will be too expensive for Europeans to buy and we'll have to start making our own again, hopefully creating lots of jobs in the process.

Immaculate Pasta · 11-02-2012 11:01AM

Deleted User wrote: »

I thought that we were turning Japanese, now we need to turn Malaysian!

https://www.youtube.com/watch?v=kWAwrMFtSvM

:cool:

Sindri · 11-02-2012 11:11AM

Deleted User wrote: »

I think that we'll (re)start basic manufacturing industries here when China cuts the "dollar" umbilical cord.
At the moment, their cheap goods are as a direct result to the dollar peg, when their domestic market is more mature, they'll let the Yuan float.

End of cheap Chinese stuff, it will be too expensive for Europeans to buy and we'll have to start making our own again, hopefully creating lots of jobs in the process.

Yeah but manufacturing is already moving to other Asian countries. Even firms based in China have moved inland where it's cheaper to operate and even Chinese companies have outsourced some manufacturing plants.

And after China it goes to South America most likely. Brazil and Mexico and similar countries.

11-02-2012 11:23AM

Sindri wrote: »

Yeah but manufacturing is already moving to other Asian countries. Even firms based in China have moved inland where it's cheaper to operate and even Chinese companies have outsourced some manufacturing plants.

And after China it goes to South America most likely. Brazil and Mexico and similar countries.

But chances are, these countries will be selling to China and not Europe/USA and China is really only interested in importing food & fuel. They've already stolen the designs of most hi-tech products by now.

Sandwlch · 11-02-2012 11:23AM

Everyone in Europe is very very rich. Some of the very very very rich just arent as rich as they thought they were.

See how rich you are compared to the rest of the world :

http://www.globalrichlist.com/

11-02-2012 11:29AM

Sandwlch wrote: »

Everyone in Europe is very very rich. Some of the very very very rich just arent as rich as they thought they were.

See how rich you are compared to the rest of the world :

http://www.globalrichlist.com/

Most Europeans are in the top 1% of global income, that is true, we are just passing the point of "peak wealth", we're not getting any richer.

Other countries are catching up, they've got a long way to go, but our (relative) wealth will decline eventually.

44leto · 11-02-2012 11:32AM

Sandwlch wrote: »

Everyone in Europe is very very rich. Some of the very very very rich just arent as rich as they thought they were.

See how rich you are compared to the rest of the world :

http://www.globalrichlist.com/

y

I am in the top 98% so 2% are better off then me, :eek: I never realised how poor I am.

So my new years resolution is to climb a %.:mad:

Sindri · 11-02-2012 11:32AM

Deleted User wrote: »

But chances are, these countries will be selling to China and not Europe/USA and China is really only interested in importing food & fuel. They've already stolen the designs of most hi-tech products by now.

I'm sort of slow I don't understand your point.

Yes but the companies already in China will relocate manufacturing jobs to these other countries. While they export raw materials to China, the coal it so preciously desires, manufacturing jobs will relocate. The expenses of manufacturing in China have risen and will rise to much higher levels. Then, we will see the cheap, and I also believe some high end manufacturing jobs mostly in Europe and Japan, relocate to other parts of Asia and Latin America.

Eventually of course they'll come back to us and it benefits us all greatly as the new middle class in these countries buy our goods and we can export to them.

11-02-2012 11:42AM

the Chinese still have some 500 million subsistence farmers, so no labour shortage there.
The point I'm making is that China is keen to import raw materials and oil from anywhere, if a product is made using locally sourced materials, then they'll import the finished product rather than ship the raw materials to China.

Because of their often aggressive trade deals, those products will not be available to the west.

Wibbs · 11-02-2012 11:48AM

44leto wrote: »

Africa is on the rise, Europe is stagnant and in decline, this is not new in world history, the wealth and world economic centre has always moved.

We are just living through another one, the East is usurping the west, the far East is rapidly becoming the world economic centre, the new west if you like. In 10 to 20 years time Europe will look more like South American economies of the 80s, broke and not much going on.

While it's a popular notion alright, I personally wouldn't agree and history would be more on my side IMHO. Yes the wealth and world economic centre has moved in the past, but it tended to do so in a remarkably Eurocentric/near eastern way(America is in essence a transplanted "European" nation in culture). It's far more rare when it didn't.

Contrary to popular, China has only once been ahead of Europe when it came to per capita wealth. That was in the Tang dynasty coinciding with the European so called "dark ages". As I said in another thread on this subject a Chinese peasant of the year 1000 would not have had a very different life to a Chinese peasant in 1600, or 1700 or 1800, hell 1900+ When the western nations went into China in the 19th century they had no decent roads outside the cities, never mind railways or extensive canal networks to the degree found in Europe. Compare that with the trajectory of the average person and nation in the west over that time. Manufacturing dominance? China has been kinda here before. They flooded the west with cheap and high quality goods throughout the 17th and 18th centuries. That's why your granny calls the good plates "china". What happened? Europe pretty quickly developed the technology and soon broke their dominance. That's why your granny may call other plates "delph"(from Delft in Holland).

Sindri · 11-02-2012 11:48AM

Deleted User wrote: »

the Chinese still have some 500 million subsistence farmers, so no labour shortage there.
The point I'm making is that China is keen to import raw materials and oil from anywhere, if a product is made using locally sourced materials, then they'll import the finished product rather than ship the raw materials to China.

Because of their often aggressive trade deals, those products will not be available to the west.

They'll being other nations I mentioned?

I am sorry I have trouble sometime.:)

Sindri · 11-02-2012 11:57AM

Wibbs wrote: »

While it's a popular notion alright, I personally wouldn't agree and history would be more on my side IMHO. Yes the wealth and world economic centre has moved in the past, but it tended to do so in a remarkably Eurocentric/near eastern way(America is in essence a transplanted "European" nation in culture). It's far more rare when it didn't.

Contrary to popular, China has only once been ahead of Europe when it came to per capita wealth. That was in the Tang dynasty coinciding with the European so called "dark ages". As I said in another thread on this subject a Chinese peasant of the year 1000 would not have had a very different life to a Chinese peasant in 1600, or 1700 or 1800, hell 1900+ When the western nations went into China in the 19th century they had no decent roads outside the cities, never mind railways or extensive canal networks to the degree found in Europe. Compare that with the trajectory of the average person and nation in the west over that time. Manufacturing dominance? China has been kinda here before. They flooded the west with cheap and high quality goods throughout the 17th and 18th centuries. That's why your granny calls the good plates "china". What happened? Europe pretty quickly developed the technology and soon broke their dominance. That's why your granny may call other plates "delph"(from Delft in Holland).

That was because China was a feudal society. Would China not have been more advanced technologically and during the Zhou and Qin dynasties? And economically during the Qin?

I don't know about your Eurocentric opinion. Dar al-Islam?

Wibbs · 11-02-2012 12:05PM

Deleted User wrote: »

the Chinese still have some 500 million subsistence farmers, so no labour shortage there.

Aye and no shortage of dissent and potential trouble in that 500 million either. It was the peasantry who got rid of Imperial China. Mao knew this and referred to the power of that group constantly. Highly centralised empires(China is far more an empire than a nation) have two trajectories, stagnate or fall to internal division. Sometimes one leads to the other. IMHO China is actually in more danger rather than less as an entity because of this recent growth. The greater the division gets between the Coastal Han peoples and the vast hinterlands of Han and other cultures, the greater the internal stresses will become and the centre won't hold. It will take immense planning, luck and even force to hold it and I can't see them succeeding. They've been here before too. It's one reason various western powers marched into the place in the 19th century. They marched into a stagnant monolithic centralised empire ripe for division and exploitation.

Because of their often aggressive trade deals, those products will not be available to the west.

Maybe, but if the western nations decide to implement any sort of trade war China is fooked. Their margins are tiny for a start. It's what has built their boom and it's what may well demolish it. Plus is it a boom or is it a bubble. I'd say it's more the latter and as it slows it may yet burst. I'm interested to hear Irish people talk on the rise of China. We forget we had something vaguely similar in our own patch of the world and it proved to be unsustainable. Yet at the time we were all telling ourselves and were told it was never gonna end and talk of soft landings etc. Yet here we are. We built ghost estates on a wave of confidence, the Chinese are currently building what have the real potential to become ghost cities.

Wibbs · 11-02-2012 12:32PM

Sindri wrote: »

That was because China was a feudal society.

So was Europe for much of it's history.

Would China not have been more advanced technologically and during the Zhou and Qin dynasties? And economically during the Qin?

Apparently not as far as the per capita of the average citizen of say Rome. The Qin didn't last very long for a start. The Zhou was amazing, sublime, breathtaking on so many levels, but those levels again tended to be centralised and monolithic. On technology, the Chinese have a history of innovation almost second to none in world history(not printing mind you, that was Korean), however the implementation and exploitation of that technology has often left a lot to be desired. Again long periods of stagnation are the order of the day. Plus they missed some innovations entirely. Innovations that left them behind in many ways. Glass being a biggie. They could make sublime ceramics so didn't bother with glass(except to decorate ceramics

). Turned out to be a big mistake. While they didn't invent printing they had it very very early on however they were held back by an overly complex written language. They had printing for a few centuries before the west and printed little of worth outside some religious texts and court fancies(and continued on that path after that). Europe gets printing and within a generation starts the first real information revolution that permeated throughout society and put the lead foot on the throttle pedal of the modern world. They had gunpowder for centuries too. Made rockets and fireworks and crude cannon(surprising given their unparalleled history of metallurgy) and bombs. Europe gets it and with a couple of generations changes the world maps.

I don't know about your Eurocentric opinion. Dar al-Islam?

Oh agreed S, hence I wrote "it tended to do so in a remarkably Eurocentric/near eastern way". Plus even there it was hugely influenced by the classical Greek/Roman world in the sciences, who had been influenced by the Persians. Lots o back and forth

. If one was to plot world power, science etc over time by holding a plumb weight above a map of the world it would tend to swing in a lazy arc around the Mediterranean more than it didn't for much of history.

44leto · 11-02-2012 01:21PM

What does Eurocentric mean in History when China or Mongolia were the economic superpowers was the world Asian Centric. Now that the USA is the world economic superpower is the world American centre.

Europe was always fragmented more so then most the world and economic centres went from Turkey Italy Portugal Spain France Holland England. If you want to see a history of the world economic superpowers follow the hub or the world number one economic cities at anytime you are studying. That is were you will see the most cultural reach and the power of that age.

At the moment only 2 believe or not reach that grade and they are New York and London but I have little to no doubt that Shanghai, Bejing Mumbai will soon replace those.

HAAA! HAAA! · 11-02-2012 03:53PM

Yeah their economies are rising quickly, while at the same time they work intolerable hours for very little.

This doesn't give them reason to lecture Europe or the west, as the general idea of an economy is not to be in a position where you have to work a sweatshop level of hours for very little.

Basically its not that they plan at a better level than the west, its's that they plan probably about just as well PLUS they have practical slave labor.

longhalloween · 11-02-2012 04:02PM

Sindri wrote: »

Possibly, but Africa does not as yet have the infrastructure. Possibly only the Maghreb, Egypt, Nigeria and South Africa.

I mean look at a map of the continent at night time.

There's more lights on in Africa than Australia

Europe is poor so should live within its means

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