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Thread: A little long - but worth reading...

  1. #1
    Lightning
    This is a long piece, but a very interesting and thought provoking assessment of world conditions, covering the war, business, demographics, world economy and more. Puts a different perspective on many topics.
    ~~~~~~~~~~~~~~~~~~~~~~~~~~~~
    Global Intelligence Briefing For CEO's
    by Herbert Meyer
    Currently, there are four major transformations that are shaping political, economic and world events.
    These transformations have profound implications for American business owners, our culture and our way of life.
    1. The War in Iraq
    There are three major monotheistic religions in the world:
    Christianity, Judaism and Islam. In the 16th century, Judaism and Christianity
    reconciled with the modern world. The rabbis, priests and scholars found a way to
    settle up and pave the way forward. Religion remained at the center of
    life, church and state became separate. Rule of law, idea of economic
    liberty, individual rights, human rights all these are defining points
    of modern Western civilization. These concepts started with the Greeks but
    didnÂ’t take off until the 15th and 16th century when Judaism and
    Christianity found a way to reconcile with the modern world. When that
    happened, it unleashed the scientific revolution and the greatest
    outpouring of art, literature and music the world has ever known.
    Islam, which developed in the 7th century, counts millions of Muslims
    around the world who are normal people. However, there is a radical
    streak within Islam. When the radicals are in charge, Islam attacks Western
    civilization. Islam first attacked Western civilization in the 7th century, and later
    in the 16th and 17th centuries. By 1683, the Muslims (Turks
    from the Ottoman Empire) were literally at the gates of Vienna. It was in
    Vienna that the climatic battle between Islam and Western civilization took
    place.
    The West won and went forward. Islam lost and went backward
    Interestingly, the date of that battle was September 11. Since them, Islam has not
    found a way to reconcile with the modern world.
    Today, terrorism is the third attack on Western civilization by radical
    Islam. To deal with terrorism, the U.S. is doing two things.
    First, units of our armed forces are in 30 countries around the world hunting down
    terrorist groups and dealing with them. This gets very little publicity.
    Second we are taking military action in Afghanistan and Iraq. These are
    covered relentlessly by the media. People can argue about whether the
    war in Iraq is right or wrong. However, the underlying strategy behind the
    war is to use our military to remove the radicals from power and give the
    moderates a chance. Our hope is that, over time, the moderates will
    find a way to bring Islam forward into the 21st century. ThatÂ’s what our
    involvement in Iraq and Afghanistan is all about.
    The lesson of 9/11 is that we live in a world where a small number of
    people can kill a large number of people very quickly. They can use
    airplanes, bombs, anthrax, chemical weapons or dirty bombs. Even with a
    first-rate intelligence service (which the U.S. does not have), you
    can’t stop every attack. That means our tolerance “for political
    horseplay” has dropped to zero. No longer will we play games with terrorists or
    weapons of mass destructions.
    Most of the instability and horseplay is coming from the Middle East.
    ThatÂ’s why we have thought that if we could knock out the radicals
    and give the moderates a chance to hold power, they might find a way to
    reconcile Islam with the modern world. So when looking at Afghanistan or Iraq,
    itÂ’s important to look for any signs that they are modernizing. For example,
    women being brought into the workforce and colleges in Afghanistan is
    good. The Iraqis stumbling toward a constitution is good. People can argue
    about what the U.S. is doing and how weÂ’re doing it, but anything that
    suggests Islam is finding its way forward is good.
    2. The Emergence of China
    In the last 20 years, China has moved 250 million people from the farms
    and villages into the cities. Their plan is to move another 300 million
    in the next 20 years. When you put that many people into the cities, you
    have to find work for them. ThatÂ’s why China is addicted to manufacturing;
    they have to put all the relocated people to work. When we decide to
    manufacture something in the U.S., itÂ’s based on market needs and the opportunity
    to make a profit. In China, they make the decision because they want the
    jobs, which is a very different calculation.
    While China is addicted to manufacturing, Americans are addicted to low
    prices. As a result, a unique kind of economic codependency has
    developed between the two countries. If we ever stop buying from China, they will
    explode politically. If China stops selling to us, our economy will
    take a huge hit because prices will jump. We are subsidizing their economic
    development, they are subsidizing our economic growth.
    Because of their huge growth in manufacturing, China is hungry for raw
    materials, which drives prices up worldwide. China is also thirsty for
    oil, which is one reason oil is now at $60 a barrel. By 2020, China will
    produce more cars than the U.S. China is also buying its way into the oil
    infrastructure around the world. They are doing it in the open market
    and paying fair market prices, but millions of barrels of oil that would
    have gone to the U.S. are now going to China. ChinaÂ’s quest to assure it
    has the oil it needs to fuel its economy is a major factor in world politics
    and economics. We have our Navy fleets protecting the sea lines,
    specifically the ability to get the tankers through. It wonÂ’t be long before the
    Chinese have an aircraft carrier sitting in the Persian Gulf as well. The
    question is, will their aircraft carrier be pointing in the same direction as
    ours or against us?
    3. Shifting Demographics of Western Civilization
    Most countries in the Western world have stopped breeding. For a
    civilization obsessed with sex, this is remarkable. Maintaining a
    steady population requires a birth rate of 2.1. In Western Europe, the birth
    rate currently stands at 1.5, or 30 percent below replacement. In 30 years
    there will be 70 to 80 million fewer Europeans than there are today. The
    current birth rate in Germany is 1.3. Italy and Spain are even lower at 1.2. At
    that rate, the working age population declines by 30 percent in 20
    years, which has a huge impact on the economy.
    When you donÂ’t have young workers to replace the older ones, you have
    to import them. The European countries are currently importing Muslims.
    Today, the Muslims comprise 10 percent of France and Germany, and the
    percentage is rising rapidly because they have higher birthrates.
    However, the Muslim populations are not being integrated into the cultures of
    their host countries, which is a political catastrophe. One reason Germany
    and France donÂ’t support the Iraq war is they fear their Muslim
    populations will explode on them. By 2020, more than half of all births in the
    Netherlands will be non-European.
    The huge design flaw in the post-modern secular state is that you need
    a traditional religious society birth rate to sustain it. The Europeans
    simply donÂ’t wish to have children, so they are dying.
    In Japan, the birthrate is 1.3. As a result, Japan will lose up to 60
    million people over the next 30 years. Because Japan has a very
    different society than Europe, they refuse to import workers. Instead, they are
    just shutting down. Japan has already closed 2000 schools, and is closing
    them down at the rate of 300 per year. Japan is also aging very rapidly. By
    2020, one out of every five Japanese will be at least 70 years old.
    Nobody has any idea about how to run an economy with those demographics.
    Europe and Japan, which comprise two of the worldÂ’s major economic
    engines, arenÂ’t merely in recession, theyÂ’re shutting down. This
    will have a huge impact on the world economy, and it is already beginning to
    happen.
    Why are the birthrates so low? There is a direct correlation between
    abandonment of traditional religious society and a drop in birth rate,
    and Christianity in Europe is becoming irrelevant. The second reason is
    economic. When the birth rate drops below replacement, the population
    ages.
    With fewer working people to support more retired people, it puts a
    crushing tax burden on the smaller group of working age people. As a result,
    young people delay marriage and having a family. Once this trend starts, the
    downward spiral only gets worse. These countries have abandoned all the
    traditions they formerly held in regards to having families and raising
    children.
    The U.S. birth rate is 2.0, just below replacement. We have an increase
    in population because of immigration. When broken down by ethnicity,
    the Anglo birth rate is 1.6 (same as France) while the Hispanic birth rate
    is 2.7. In the U.S., the baby boomers are starting to retire in massive
    numbers. This will push the “elder dependency” ratio from 19 to 38
    over the next 10 to 15 years. This is not as bad as Europe, but still represents
    the same kind of trend.
    Western civilization seems to have forgotten what every primitive
    society understands, you need kids to have a healthy society. Children
    are huge consumers. Then they grow up to become taxpayers. ThatÂ’s how a
    society works, but the post-modern secular state seems to have
    forgotten that. If U.S. birth rates of the past 20 to 30 years had been the same
    as post-World War II, there would be no Social Security or Medicare
    problems.
    The worldÂ’s most effective birth control device is money. As society
    creates a middle class and women move into the workforce, birth rates
    drop.
    Having large families is incompatible with middle class living. The
    quickest way to drop the birth rate is through rapid economic
    development. After World War II, the U.S. instituted a $600 tax credit per child.
    The idea was to enable mom and dad to have four children without being
    troubled by taxes. This led to a baby boom of 22 million kids, which was a huge
    consumer market that turned into a huge tax base. However, to match
    that incentive in todayÂ’s dollars would cost $12,000 per child.
    China and India do not have declining populations. However, in both
    countries, there is a preference for boys over girls, and we now have
    the technology to know which is which before they are born. In China and
    India, many families are aborting the girls. As a result, in each of these
    countries there are 70 million boys growing up who will never find
    wives. When left alone, nature produces 103 boys for every 100 girls. In some
    provinces, however, the ratio is 128 boys to every 100 girls.
    The birth rate in Russia is so low that by 2050 their population will
    be smaller than that of Yemen. Russia has one-sixth of the earthÂ’s land
    surface and much of its oil. You canÂ’t control that much area with
    such a small population. Immediately to the south, you have China with 70
    million unmarried men – a real potential nightmare scenario for Russia.
    4. Restructuring of American Business
    The fourth major transformation involves a fundamental restructuring of
    American business. TodayÂ’s business environment is very complex and
    competitive. To succeed, you have to be the best, which means having
    the highest quality and lowest cost. Whatever your price point, you must
    have the best quality and lowest price. To be the best, you have to
    concentrate on one thing. You canÂ’t be all things to all people and be the best.
    A generation ago, IBM used to make every part of their computer. Now
    Intel makes the chips, Microsoft makes the software, and someone else
    makes the modems, hard drives, monitors, etc. IBM even outsources their call
    center. Because IBM has all these companies supplying goods and
    services cheaper and better than they could do it themselves, they can make a
    better computer at a lower cost. This is called a “fracturing” of
    business. When one company can make a better product by relying on others to perform
    functions the business used to do itself, it creates a complex pyramid
    of companies that serve and support each other.
    This fracturing of American business is now in its second generation.
    The companies who supply IBM are now doing the same thing, outsourcing
    many of their core services and production process. As a result, they can
    make cheaper, better products. Over time, this pyramid continues to get
    bigger and bigger. Just when you think it canÂ’t fracture again, it does.
    Even very small businesses can have a large pyramid of corporate entities
    that perform many of its important functions. One aspect of this trend is
    that companies end up with fewer employees and more independent contractors.
    This trend has also created two new words in business, integrator and
    complementor. At the top of the pyramid, IBM is the integrator. As you
    go down the pyramid, Microsoft, Intel and the other companies that support
    IBM are the complementors. However, each of the complementors is itself an
    integrator for the complementors underneath it. This has several
    implications, the first of which is that we are now getting false
    readings on the economy. People who used to be employees are now independent
    contractors launching their own businesses. There are many people
    working whose work is not listed as a job. As a result, the economy is perking
    along better than the numbers are telling us.
    Outsourcing also confused the numbers. Suppose a company like General
    Motors decides to outsource all its employee cafeteria functions to
    Marriott (which it did). It lays off hundreds of cafeteria workers, who then get
    hired right back by Marriott. The only thing that has changed is that
    these people work for Marriott rather than GM. Yet, the headlines will scream
    that America has lost more manufacturing jobs. All that really happened
    is that these workers are now reclassified as service workers. So the old
    way of counting jobs contributes to false economic readings. As yet, we
    havenÂ’t figured out how to make the numbers catch up with the changing
    realities of the business world.
    Another implication of this massive restructuring is that because
    companies are getting rid of units and people that used to work for
    them, the entity is smaller. As the companies+ get smaller and more
    efficient, revenues are going down but profits are going up. As a result, the old
    notion that “revenues are up and we’re doing great” isn’t
    always the case anymore. Companies are getting smaller but are becoming more efficient
    and profitable in the process.
    Implications Of The Four Transformations
    1. The War in Iraq
    In some ways, the war is going very well. Afghanistan and Iraq have the
    beginnings of a modern government, which is a huge step forward. The
    Saudis are starting to talk about some good things, while Egypt and Lebanon
    are beginning to move in a good direction.
    A series of revolutions have taken place in countries like Ukraine and
    Georgia. There will be more of these revolutions for an interesting
    reason. In every revolution, there comes a point where the dictator turns to
    the general and says, “Fire into the crowd.” If the general fires into
    the crowd, it stops the revolution. If the general says “No,” the
    revolution is over. Increasingly, the generals are saying “No” because their kids
    are in the crowd.
    Thanks to TV and the Internet, the average 18-year old outside the U.S.
    is very savvy about what is going on in the world, especially in terms
    of popular culture. There is a huge global consciousness, and young people
    around the world want to be a part of it. It is increasingly apparent
    to them that the miserable government where they live is the only thing
    standing in their way. More and more, it is the well-educated kids, the
    children of the generals and the elite, who are leading the
    revolutions.
    At the same time, not all is well with the war. The level of violence
    in Iraq is much worse and doesnÂ’t appear to be improving. ItÂ’s
    possible that weÂ’re asking too much of Islam all at one time. WeÂ’re trying
    to jolt them from the 7th century to the 21st century all at once, which may be
    further than they can go. They might make it and they might not. Nobody
    knows for sure. The point is, we donÂ’t know how the war will turn
    out. Anyone who says they know is just guessing.
    The real place to watch is Iran. If they actually obtain nuclear
    weapons it will be a terrible situation. There are two ways to deal
    with it. The first is a military strike, which will be very difficult. The
    Iranians have dispersed their nuclear development facilities and put
    them underground. The U.S. has nuclear weapons that can go under the earth
    and take out those facilities, but we donÂ’t want to do that. The other
    way is to separate the radical mullahs from the government, which is the most
    likely course of action.
    Seventy percent of the Iranian population is under 30. They are Muslim
    but not Arab. They are mostly pro-Western. Many experts think the U.S.
    should have dealt with Iran before going to war with Iraq. The problem
    isnÂ’t so much the weapons, itÂ’s the people who control them. If Iran has
    a moderate government, the weapons become less of a concern.
    We donÂ’t know if we will win the war in Iraq. We could lose or win.
    What weÂ’re looking for is any indicator that Islam is moving into the
    21st century and stabilizing
    2. China
    It may be that pushing 500 million people from farms and villages into
    cities is too much too soon. Although it gets almost no publicity,
    China is experiencing hundreds of demonstrations around the country, which is
    unprecedented. These are not students in Tiananmen Square. These are
    average citizens who are angry with the government for building
    chemical plants and polluting the water they drink and the air they breathe.
    The Chinese are a smart and industrious people. They may be able to
    pull it off and become a very successful economic and military
    superpower. If so, we will have to learn to live with it. If they want to share the
    responsibility of keeping the worldÂ’s oil lanes open, thatÂ’s a good
    thing. They currently have eight new nuclear electric power generators under
    way and 45 on the books to build. Soon, they will leave the U.S. way behind
    in their ability to generate nuclear power.
    What can go wrong with China? For one, you canÂ’t move 550 million
    people into the cities without major problems. Two, China really wants
    Taiwan, not so much for economic reasons, they just want it. The
    Chinese know that their system of communism canÂ’t survive much longer in the
    21st century. The last thing they want to do before they morph into some
    sort of more capitalistic government is to take over Taiwan.
    We may wake up one morning and find they have launched an attack on
    Taiwan. If so, it will be a mess, both economically and militarily. The
    U.S. has committed to the military defense of Taiwan. If China attacks
    Taiwan, will we really go to war against them? If the Chinese generals
    believe the answer is no, they may attack. If we donÂ’t defend Taiwan,
    every treaty the U.S. has will be worthless. Hopefully,China wonÂ’t do
    anything stupid.
    3. Demographics
    Europe and Japan are dying because their populations are aging and
    shrinking. These trends can be reversed if the young people start
    breeding. However, the birth rates in these areas are so low it will take two
    generations to turn things around. No economic model exists that
    permits 50 years to turn things around. Some countries are beginning to offer
    incentives for people to have bigger families. For example, Italy is
    offering tax breaks for having children. However, itÂ’s a lifestyle
    issue versus a tiny amount of money. Europeans arenÂ’t willing to give up
    their comfortable lifestyles in order to have more children.
    In general, everyone in Europe just wants it to last a while longer.
    Europeans have a real talent for living. They donÂ’t want to work very
    hard. The average European worker gets 400 more hours of vacation time per
    year than Americans. They donÂ’t want to work and they donÂ’t want to make
    any of the changes needed to revive their economies.
    The summer after 9/11, France lost 15,000 people in a heat wave. In
    August, the country basically shuts down when everyone goes on
    vacation. That year, a severe heat wave struck and 15,000 elderly people living
    in nursing homes and hospitals died. Their children didnÂ’t even leave
    the beaches to come back and take care of the bodies. Institutions had to
    scramble to find enough refrigeration units to hold the bodies until
    people came to claim them.
    This loss of life was five times bigger than 9/11 in America, yet it
    didnÂ’t trigger any change in French society. When birth rates are so
    low, it creates a tremendous tax burden on the young. Under those
    circumstances, keeping mom and dad alive is not an attractive option. ThatÂ’s why
    euthanasia is becoming so popular in most European countries. The only
    country that doesnÂ’t permit (and even encourage) euthanasia is
    Germany, because of all the baggage from World War II.
    The European economy is beginning to fracture. The Euro is down.
    Countries like Italy are starting to talk about pulling out of the
    European Union because it is killing them. When things get bad economically in
    Europe, they tend to get very nasty politically. The canary in the mine
    is anti-Semitism. When it goes up, it means trouble is coming. Current
    levels of anti-Semitism are higher than ever. Germany wonÂ’t launch another
    war, but Europe will likely get shabbier, more dangerous and less pleasant to
    live in.
    Japan has a birth rate of 1.3 and has no intention of bringing in
    immigrants. By 2020, one out of every five Japanese will be 70 years
    old. Property values in Japan have dropped every year for the past 14 years.
    The country is simply shutting down.
    In the U.S. we also have an aging population. Boomers are starting to
    retire at a massive rate. These retirements will have several major
    impacts:
    · Possible massive sell-off of large four-bedroom houses and a
    movement to condos.
    · An enormous drain on the treasury. Boomers vote, and they
    want their benefits, even if it means putting a crushing tax burden on
    their kids to get them. Social Security will be a huge problem. As this
    generation ages, it will start to drain the system. We are the only
    country in the world where there are no age limits on medical procedures.
    · An enormous drain on the health care system. This will also
    increase the tax burden on the young, which will cause them to delay
    marriage and having families, which will drive down the birth rate even
    further.
    Although scary, these demographics also present enormous opportunities
    for products and services tailored to aging populations. There will be
    tremendous demand for caring for older people, especially those who
    donÂ’t need nursing homes but need some level of care. Some people will have a
    business where they take care of three or four people in their homes.
    The demand for that type of service and for products to physically care for
    aging people will be huge.
    Make sure the demographics of your business are attuned to where the
    action is. For example, you donÂ’t want to be a baby food company in
    Europe or Japan. Demographics are much underrated as an indicator of where the
    opportunities are. Businesses need customers. Go where the customers
    are.
    4. Restructuring of American Business
    The restructuring of American business means we are coming to the end
    of the age of the employer and employee. With all this fracturing of
    businesses into different and smaller units, employers canÂ’t
    guarantee jobs anymore because they donÂ’t know what their companies will look like
    next year. Everyone is on their way to becoming an independent contractor.
    The new workforce contract will be, “Show up at the my office five days a
    week and do what I want you to do, but you handle your own insurance,
    benefits, health care and everything else.”
    Husbands and wives are becoming economic units. They take different
    jobs and work different shifts depending on where they are in their
    careers and families. They make tradeoffs to put together a compensation
    package to take care of the family. This used to happen only with highly educated
    professionals with high incomes. Now it is happening at the level of
    the factory floor worker. Couples at all levels are designing their
    compensation packages based on their individual needs. The only way
    this can work is if everything is portable and flexible, which requires a
    huge shift in the American economy.
    The U.S. is in the process of building the worldÂ’s first 21st century
    model economy. The only other countries doing this are U.K. and
    Australia. The model is fast, flexible, highly productive and unstable in that it
    is always fracturing and re-fracturing. This will increase the economic
    gap between the U.S. and everybody else, especially Europe and Japan.
    At the same time, the military gap is increasing. Other than China, we
    are the only country that is continuing to put money into their
    military. Plus, we are the only military getting on-the-ground military
    experience through our war in Iraq. We know which high-tech weapons are working
    and which ones arenÂ’t. There is almost no one who can take us on
    economically or militarily. There has never been a superpower in this position
    before.
    On the one hand, this makes the U.S. a magnet for bright and ambitious
    people. It also makes us a target. We are becoming one of the last
    holdouts of the traditional Judeo-Christian culture. There is no better
    place in the world to be in business and raise children. The U. S. is
    by far the best place to have an idea, form a business and put it into the
    marketplace. We take it for granted, but it isnÂ’t as available in
    other countries of the world.
    Ultimately, itÂ’s an issue of culture. The only people who can hurt us
    are ourselves, by losing our culture. If we give up our Judeo-Christian
    culture, we become just like the Europeans. The culture war is the
    whole ballgame. If we lose it, there isnÂ’t another America to pull us out.
    ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~
    Herb Meyer served during the Reagan administration as special assistant to the
    Director of Central Intelligence and Vice Chairman of the CIAÂ’s National Intelligence
    Council. In these positions, he managed production of the U.S. National Intelligence
    Estimates and other top-secret projections for the President and his national security advisers.
    Meyer is widely credited with being the first senior U.S. Government official to forecast the
    Soviet UnionÂ’s collapse, for which he later was awarded the U.S. National Intelligence
    Distinguished Service Medal, the intelligence community's highest honor. Formerly an associate
    editor of FORTUNE, he is also the author of several books.

  2. #2
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    Great post. Enlightenment at it's finest. I wish my child and future grandchildren well.

  3. #3
    Old Texan
    I've read this before. It's very much on the money.
    I'm curious on the feedback as it hits on most all topics we regualrly "discuss" around here. It supports a lot of opinions and shoots down a good share but it's really quite bipartisan....Good post, thanks

  4. #4
    Jesster
    Great reading. Puts perspective to pretty much everything going on in the world. One of the things that stand out to me is that the influx of illegalÂ’s may end up being a boon to the United States. Probably more for longevityÂ’s sake than anything else, but that may just be my ill feelings about the seeming invasion of our country by the Mexicans than anything else.
    People in the US look at the past as a time with 4+ kids, mom at home, and good school systems not to mention the music, because it is a recent memory for many of us. Many of us don't want to see that change especially into what we see it changing into. That said change is inevitable and big changes are coming. Regardless of the changes though this country is out of control in many areas, and the politicians in general are not smart enough or donÂ’t have the foresight to see the inevitable outcome of their decisions. Our sitting president included, but a worse alternative to our president would be any of the Dem candidates.
    Old Texan said he will be interested in the feedback. I am very surprised that it has gotten so little. I thought for sure that PosterX and Blown would have a yea or nay comment. It is a long read though and many wonÂ’t take the time. ThatÂ’s a shame.

  5. #5
    Lightning
    I'm surprised this thread has not gotten more replies...I know it's long but it really has some great perspectives on things. Maybe it's one of those thread you read and say to yourself "that pretty much sums it up, I have nothing to add..."

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