Superpowers

through time 2

Shift to a multi-polar world

• Today:

– Period of transition?

– Uni-polar US-dominated world giving way to more

multi-polar one?

• Growing powers around the world increasingly

challenge due to:– Energy resources

– Alliances- political links

– Economic power

– Demographic weight

– Nuclear weapons

How did early Superpowers maintain status?

• UK- during British Empire- through direct power and influence- colonialism and imperialism- manufacturing base- cultural power- through language and religion spread-direct investment in education and infrastructure in some colonies

• Bi- polar world –USA V USSR- control over ideology used each other to gain power over other nations- spread political agenda etc

• http://current.com/groups/on-current-tv/88914010_superpower-politics.htm

• http://current.com/groups/on-current-tv/88911076_superpower-firepower.htm

• http://current.com/groups/on-current-tv/88912435_superpower-money.htm

• http://current.com/groups/on-current-tv/88911077_superpower-culture.htm

The Worlds One Superpower

The USA and its Superpower status

How does this video suggest that the USA is a global superpower?

• http://www.youtube.com/watch?v=-EW5ushVqEM America still superpower

• http://www.youtube.com/watch?v=SRbYV5OWf2E ECONOMIC POWER LOSS?

• http://www.youtube.com/watch?v=Da6qckWgsL4&feature=related Anti America

The rise of US Power 1900-1990By 1900 the USA had overtaken Britain as the world’s most dominant

SuperpowerIt held and managed to maintain that position because1) Had one of world’s major arable production areas- the Great Plains-

where a large share of world’s grain produced (a necessity for both human and animals feed)

2) Had steel and iron industry on Eastern coast, ready to be easily transferred to Euro market across Atlantic

3) Rail links between pacific and Atlantic coasts so scope to influence Europe and Asia

4) Location- access to Europe and Asia 5) Had substantial reserves of coal and oil needed to develop industry and

good for export6) In 1940 world’s largest manufacturer of industrial and consumer goods7) Produced goods and finance to rebuild Europe after WW28) By 1950 US$ World’s major currency- 60% of global bank reserves held

in dollars9) US military is everywhere dominating the globe in numbers and spending

power- bases on all continents USA now produces over 50% of world GDP

US reaction to COMMUNISM

• USA very worried by COMMUNIST expansion into China and Korea during 1940s

• Tried to quell the spread by investing money into Asia especially India

• The fight against communism consumed the USA till the Soviet Union collapsed totally in 1991

• Americans tried to combat communism by using the Modernisation theory-

• Modernisation theorists aimed to explain that poverty was a trap or cycle

• Traditional family values held back economies• Capitalism solution to poverty• Investment and development loans to countries to USSR and

China could reduce communist spread• As result they poured investment into Japan, India, Singapore,

South Korea, Thailand and the Philippines as well as their neighbour- Mexico

USA financial power- setting up the IMF and World bank

• The IMF (International Monetary Fund) formed 1944 Bretton Woods, USA

• Aim to stabilise currencies after 1930s depression

• Initially 44 governments joined- created fund that could be used to help countries in debt- meaning communism would be prevented

• IMF now 185 members- not equal voting rights proportional to amount invested. The world’s lading 21 economies invest most money and control 70% of votes- USA has 17% as has largest economy- between them the EU has 25%, developed western nations have 55%, BRICs have only 9.7%, while LDCs have less than 1% between them

• The IMF therefore is very Western centred and controlled by them

• Today it is still used as a stabiliser to aid debt ridden countries

How is the USA doing today-

• Maintains control indirectly by having key roles in many international organisations, trade patterns and agreements and through cultural power-BUT China is coming up to compete with its financial dominance in terms of total money in each nation- not in terms of per capita!

• Media control- e.g. Microsoft, Google, sky, fox media, McDonalds and Disney- influence whole world

• English- global language US has most native speakers• Energy- has renewables potential due to land area- influence over middle

East- Iraq and Saudi Arabia- but still imports most energy and is particularly reliant on Canada

• Military bases across the globe (disguised some say, as aid bases)• TNCs- spread a subliminal message about the nation of their birth

reinforcing power they have • So is the USA to be just a CULTURAL POWER in future? We will see in a few

lessons

UK Still got the power?• Once gained SP status has to be maintained• As recently as 1945 colonialism still dominated large parts of the

earth

Colonial rule in 1936

• Most colonial powers were European but some US colonies were still around, e.g. the Philippines

• Colonial rule usually had distinct phases-• Exploration- discovery of new lands (e.g. 1492 Columbus

sailed the ocean blue and discovered the Americas• Initial settlement on coastlines• Trade in raw material began• Gradual extension of rule over larger territories by direct

military action and direct rule• Development of political systems and institutions and

transport and trade networks both to rule the colony and exploit its resources

Colonial India• A strict order maintained

between the ruling white British and the Indians

• British modernised India so its economy could better serve the needs of Britain

• Most durable feature was the railway system-

• 1880- 14,000km of rail built• By 1920- 61,000km• Hugely improved travel and

trade prospects, also allowed efficient military transport to quell disturbances

Summary of the problems of independence in Indian sub continent

1971 war broke out, leading to formation of Bangladesh- in what used to be east Pakistan

In mixed ethnic areas violence erupted, e.g. in Bengal and Punjab

In 1947 war between India and Pakistan over disputed Kashmir region

Dispute and periods of violence still flair up. Dispute never resolved

Punjab

Bengal

14 million moved across borders to relocate in areas of own religion

India partitioned into largely Muslim Pakistan and largely Sikh/ Hindu India in 1947

Now Sri Lanka-civil conflict here too

General legacy problems

• Philippines- introduction of Christianity from the US, and influx of Islam from Indonesia- conflict which still lives on today

• Much of Sub Saharan Africa- as above, plus less infrastructure development than in Asia- meaning economies left behind, many countries still rely on colonials for investment and to control markets.

• Some countries in better states than others- e.g. Sierra Leone and Somalia have never developed at all, whereas Ghana and Nigeria have developed in some areas, e.g. education, but still have civil tensions caused by colonial legacy

• India, Pakistan and Bangladesh- good infrastructure left in place by colonials, giving opportunity for manufacturing industry to be developed and links gave market for commodities like tea, coffee, etc

• Brazil- important trade partner in sugar, bananas and coffee, built on legacy- better placed as used African slaves provided by Europeans to develop

Neo colonialism-• ‘New’ colonialism- where countries remain controlled

by overseas- even though they’re supposedly independent.

The example of Ghana

• In 2007 Ghana celebrated 50 years of independence, they were the 1st Sub Saharan nation to be declared free of colonial rule in 1957

• 50 years later- some legacies remain, for example English is the official language, there are plenty of schools and hospitals built

• However under colonial rule-best jobs held by Brits not Ghanaians

• Ghana’s crops were exported in raw state- so Britain processed them and added value not Ghana

• In 1957 (independence year) Ghana had GDP equal to South Korea, since SK has developed rapidly whereas 1/3 of Ghanaians live on less than dollar a day (below global poverty line)

• Ghana relies still on wealthy nations like Britain to buy its commodities

Cocoa growing region

Cocoa Trade• Always been important

• In colonial times largest world producer, Brits used to dictate price farmers received

• Today price controlled by 3 external forces-

1) Commodity traders (cocoa industry)

2) Overseas tariffs

3) World Trade Organisation (WTO)

1. Commodity traders

• Commodity trading exchanges found in London and New York.

• Buyers seek supplies of cocoa for large companies like Cadburys’, where continuous supply is essential

• So supply is guaranteed deal in futures market (ie buy now to be delivered in 3-6 months time)

• Cocoa price depends on supply and demand, which varies-Ghana no longer largest supplier been overtaken by neighbouring Ivory Coast (Cote D’Ivoire)

• If Ghana prices to high buyers will purchase from another country- pushing prices downwards

• This makes Cocoa prices very volatile• Between 1991 and 95 price changed 60 times• From 1996-2002 changed 90 times• From 1991-93 price increased 12%• From June 1998 to December 2000 dropped by 32.5%

Dependency and development theory

• Dependency theory states that cause of poverty in developing nations is reliance on more developed economies- that they continue to sell raw products to countries opposed to developing own processing and manufacturing industries then selling them for increased profits

Produce agricultural/ primary produce

Raw goods exported

low value

Low profit

made

No money for investment in machines or manufacturing

2. Overseas Tariffs• Most processing and packaging of cocoa is done in

Europe• EU import tariffs (duties on imported goods) higher

for processed cocoa than raw beans e.g. in 2007 7.7% tariff on cocoa powder, 15% on chocolate containing cocoa butter but none on beans

• This is known as tariff escalation.• USA and Japan have no import tariff on beans but up

to 65% on cocoa chocolate imports• Ghana forced to export the beans lose out on the

value added by processing them, so cocoa farmers have very hard no profit life

3. WTO

• Ghana joined in 1995 to increase it’s global trade

• Until then Ghana had subsidised its farmers to encourage them to stay on and farm land rather than migrate to larger cities for other work

• The WTO imposed a joining condition on Ghana that it could no longer subsidise farmers (even though other countries do so)

• Now Ghanaian farmers struggle against imports of heavily subsidised foreign food. E.g. tomato growers in Upper east district cannot compete with EU tomatoes which are much cheaper to import

• As result tomato canning factories have closed so there is no market for their tomatoes

• Same has occurred with rice farmers who cannot compete with cheaper US imports

Does it seem like countries like Ghana gain or lose from WTO membership?

The WTO• Belongs to same family of organisations as the IMF and world bank• Deals with global trade, aim to ease trade and rid anything hindering it• Operates on one country- one vote system, so in theory seems fairer• Voting has never occurred decisions made by mutual consent- with

biggest markets generally deciding outcome• Poorer nations feel WTO is a rich mans club and bargaining favours EU

and the USA

Subsidies- grants paid to farmers to encourage production

Currently WTO working to remove them, but its own rules aren’t easily

applicable-

In theory WTO should be anti subsidies because it believes in FREE TRADE

with no tariffs or subsidies

Only rich countries can afford to give substantial subsidies poor cannot greatly

• But WTO agreement on agriculture allows support, under 3 categories

• Green- subsidies for environmental benefits, e.g. reducing crop output replacing with woodland

• Amber- allows subsidies governments have reduced but not cut all together

• Blue- allows them as long as production reduced long term

• This allows EU and USA to spend $400 billion annually on subsidies- allowing large farmers to go on mass producing, ironically this leads to surplus product then bought by LDC countries- undermining any producers in their own country

Where next for the Ghanaian cocoa farmer?

• To escape this cycle, Ghanaian farmers are beginning to form cooperatives an example is ‘Kuapa Kokoo (good cocoa farmers) which begun in 1993. Has 40,000 farmers in 650 villages producing 1% of total produced

• They sell to ‘fair trade’ organisations in Europe and being a coop can bargain more for each bag of beans than could as individuals

• In 1998 joined UK company to create ‘day chocolate company’ it makes ‘divine’ chocolate, aimed at mainstream UK choc market

• Profit has paid for wells to provide fresh drinking water in villages and health insurance so farmers and their families are protected if job threatening things happen

In July 2009 Cadbury Dairy Milk became fair trade why could this cause problems for other fair trade chocolate companies?

• Why could the UK still be said to be a superpower? Discuss

• What is neo-colonialism?

• What is responsible for Ghana’s current peripheral location in the world?

Exam Questions

• Explain using examples, how superpowers can exert their influence (15)