China: The Sword, the Purse and the Word

The Sword, the Purse and the Word. No, this is not the title of the next Harry Potter book. It is the simple formula as to how Western nations have managed to prosper and hold the levers of world power for over 500 years. The simplistic breakdown of this formula is roughly: The Sword (military power and empire). The Purse (the bootie and accompanying wealth of empire). The Word (the philosophical principles and laws—the governance of a people).

The third, the Word is the most crucial. Without a system of just and humane laws a nation, no matter how wealthy, will collapse in on itself through its own corruption and ineptitude.

Since Magna Carta the West has managed through fits and starts to bestow upon the common man the rights and privileges once afforded only to a tiny and elite aristocracy throughout the great expanse of human history. This is the Western world’s Word. And this is why the Western powers will continue to prosper and control those levers of international power. (I remember how Japan was supposed to be the next superpower—speak of collective intellectual amnesia!)

As many American companies are learning (the hard way) China has the Sword (for sure) and now a lot of Purse, but it has very little of the Word as it applies to the rights of the common man and for this reason it will fail.

It would behoove American companies (and other international companies that are based in human rights-oriented political systems) to sparsely invest in countries, institutions and/or cultures that repress the Rights of Man. And those that do not tread lightly in these totalitarian systems, despite their misguided convictions of some elusive political stability, will eventually regret such investments—just ask Google.