Uncertainty in the BRICS

The nature of today's economy is uncertainty, and nowhere is that more true than in developing nations.

In the third of these linked blog posts, we return to the general theme of "The Great Uncertainty" to explore the consequences of the shift in the balance of economic power that many discern, broadly from ‘West’ to ‘East’. The issues, we suggest, are rather more complex and involved than we are typically led to believe in popular accounts couched in terms of ‘rising powers’ and the challenge of the BRICS economies.

So where to start? Well, what is clear to us is that there is indeed a shift taking place in the balance of global economic power. That, at least, we can agree on. There is no need, we feel, to fill this post with figures because the broad picture is pretty well established. Indeed, it is captured, after a fashion, in those speculative pieces that we have all read about exactly when China will overtake the US as the largest economy in the world (although this, too, is more complicated a calculation than is often recognised).

The essential point, though, is that the combination of longish periods of (very) fast economic growth in some countries with slow growth, stagnation and recession in others cannot but alter the respective weights of different countries (and by extension regions) within the global economy. It is from that core shift that all the other features that are so much discussed – different patterns of FDI, aid, trade, bond purchases and the like – emanate.

However, the analytical problem is that economic power does not translate easily or automatically into political power. Or, to put it a little differently in what has been a common theme of ours, economics is not political economy. Economic power can be measured statistically by reference to GDP, proportion of world trade, level and direction of financial flows, and so on. Political power cannot. It has instead to be pondered and probed.

What do we find when we do this? Let’s start with China. In a simple sense it is the most obvious candidate to replace the US as the hegemon of the global political economy. But, for all its fast and continuing economic growth, it is in fact beset by a host of problems generated by its particular experience of late industrialisation and single-party politics. These include: a core imbalance in its economy between investment and consumption, considerable ongoing financial instability, deep social inequalities and tensions, and the confusion about intentions inevitably generated by its opaque and increasingly corrupt state structure. And this is not even to mention the big, looming issue of being pressured to move at some point in a democratic direction.

The reality is that, for all the talk a while ago of an emerging "Beijing Consensus", China has yet to produce a style of capitalism that is globally attractive.

Let’s move on to think about India, Brazil and other ‘rising powers’. Here, once more, the political picture is much less sharply defined than the economic one. In global terms India still lives mostly within itself. It has a very strong historical sense of the uniqueness of its continental civilisation and seems content for the moment to deploy an assertively ‘Southern’ rhetoric amidst broad acquiescence in a US-centred world order.

Brazil is best seen politically as the major regional power of South America. Given its location and history, it is always alert to the possibility of overbearing behaviour by the US and is ready to be stroppy if necessary. But it has yet to set out a coherent and convincing account of the global role that it might like to play in the future.

We could at this point go further on down a list to discuss Russia, South Africa, Mexico, Indonesia, even Turkey. But we already know that we are referring here to countries that have a power and a presence in global politics, without yet constituting major players when it comes to shaping policy outcomes in the UN, the IMF, the WTO or any other global, as opposed to regional or ‘Southern’, institution.

In a very interesting recent article, the veteran Indian political scientist, Achin Vanaik, has argued that what is emerging is a ‘new pentarchy’, consisting of the US, the EU, Russia, China and India. Others don’t quite make the grade. In his view, such a pentarchy will not be formalised like the G8 and G20. Nor will it be a concert of equals or near-equals, but rather a hub-and-spokes arrangement with the US at the centre and the others at the circumference.

Vanaik advances this proposition on the basis of an attempt to integrate economic and political power into his thinking. All his five entities have sufficient demographic, economic and military weight to qualify, as it were, but only the US has the soft – or ideological – power to ‘project a social-political-cultural model that is potentially generalisable’. He asks tellingly: ‘How many states and their ruling and middle classes want to become more and more like Russia, China or India rather than like the USA?’ What about the EU in this context? It is dismissed in a single brutal phrase: ‘The EU by its very nature cannot be a single unified aspirational model’.

Now, this is but one recent piece of political analysis. It’s quite persuasive in its way, but things almost certainly won’t work out in quite the manner that Vanaik suggests, and that is really the key point. Political economy analysis is contentious stuff. We don’t ever stand on especially firm ground. We make judgements, and then see how events unfold, adjusting our thinking as we go. Economic power in the world is shifting, but we can’t be certain quite what that will mean politically over the next few years and that just reinforces the sense of the uncertainty of the times in which we live.

This is the third in a five-post series on the "Great Uncertainty".

Professors Colin Hay and Tony Payne are Directors of the Sheffield Political Economy Research Institute at the University of Sheffield.

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The joy of only winning once: why England should be proud of 1966

We feel the glory of that triumphant moment, 50 years ago, all the more because of all the other occasions when we have failed to win.

There’s a phrase in football that I really hate. It used to be “Thirty years of hurt”. Each time the England team crashes out of a major tournament it gets regurgitated with extra years added. Rather predictably, when England lost to Iceland in Euro 2016, it became “Fifty years of hurt”. We’ve never won the European Championship and in 17 attempts to win the World Cup we have only won once. I’m going to tell you why that’s a record to cherish.

I was seven in 1966. Our telly was broken so I had to watch the World Cup final with a neighbour. I sat squeezed on my friend Colin’s settee as his dad cheered on England with phrases like “Sock it to them Bobby”, as old fashioned now as a football rattle. When England took the lead for the second time I remember thinking, what will it feel like, when we English are actually Champions of the World. Not long after I knew. It felt good.

Wembley Stadium, 30 July 1966, was our only ever World Cup win. But let’s imagine what it would be like if, as with our rivals, we’d won it many times? Brazil have been World Champions on five occasions, Germany four, and Italy four. Most England fans would be “over the moon” if they could boast a similarly glorious record. They’re wrong. I believe it’s wonderful that we’ve only triumphed once. We all share that one single powerful memory. Sometimes in life less is definitely more.

Something extraordinary has happened. Few of us are even old enough to remember, but somehow, we all know everything that happened that day. Even if you care little about the beautiful game, I’m going to bet that you can recall as many as five iconic moments from 50 years ago. You will have clearly in your mind the BBC commentator Kenneth Wolstenholme’s famous lines, as Geoff Hurst tore down the pitch to score his hat-trick: “Some people are on the pitch. They think it’s all over. It is now”. And it was. 4 - 2 to England against West Germany. Thirty minutes earlier the Germans had equalised in the dying moments of the second half to take the game to extra time.

More drama we all share: Geoff Hurst’s second goal. Or the goal that wasn’t, as technology has since, I think, conclusively proved. The shot that crashed off the cross bar and did or didn’t cross the line. Of course, even if you weren’t alive at the time, you will know that the linesman, one Tofiq Bakhramov, from Azerbaijan (often incorrectly referred to as “Russian”) could speak not a word of English, signalled it as a goal.

Then there’s the England Captain, the oh-so-young and handsome Bobby Moore. The very embodiment of the era. You can picture him now wiping his muddy hands on his white shorts before he shakes hands with a youthful Queen Elizabeth. Later you see him lifted aloft by his team mates holding the small golden Jules Rimet trophy.

How incredible, how simply marvellous that as a nation we share such golden memories. How sad for the Brazilians and Germans. Their more numerous triumphs are dissipated through the generations. In those countries each generation will remember each victory but not with the intensity with which we English still celebrate 1966. It’s as if sex was best the first time. The first cut is the deepest.

On Colin’s dad’s TV the pictures were black and white and so were the flags. Recently I looked at the full colour Pathe newsreel of the game. It’s the red, white and blue of the Union Jack that dominates. The red cross of Saint George didn’t really come into prominence until the Nineties. The left don’t like flags much, unless they’re “deepest red”. Certainly not the Union Flag. It smacks of imperialism perhaps. In 1966 we didn’t seem to know if we were English or British. Maybe there was, and still is, something admirable and casual about not knowing who we are or what is our proper flag. 

Twelve years later I’m in Cuba at the “World Festival of Youth” – the only occasion I’ve represented my country. It was my chance to march into a stadium under my nation’s flag. Sadly, it never happened as my fellow delegates argued for hours over what, if any, flag we British should walk behind. The delegation leaders – you will have heard of them now, but they were young and unknown then – Peter Mandelson, Trevor Phillips and Charles Clarke, had to find a way out of this impasse. In the end, each delegation walked into the stadium behind their flag, except the British. Poor Mandelson stood alone for hours holding Union Jack, sweltering in the tropical sun. No other country seemed to have a problem with their flag. I guess theirs speak of revolution; ours of colonialism.

On Saturday 30 July BBC Radio 2 will commemorate the 50th anniversary of the 1966 World Cup Final, live from Wembley Arena. Such a celebration is only possible because on 16 occasions we failed to win that trophy. Let’s banish this idea of “Fifty years of hurt” once and for all and embrace the joy of only winning once.

Phil Jones edits the Jeremy Vine Show on BBC Radio 2. On Saturday 30 July the station celebrates the 50th anniversary of the 1966 World Cup Final live from Wembley Arena, telling the story of football’s most famous match, minute by minuteTickets are available from: www.wc66.org