SolidarityEconomy.net

by Jerry Harris

.Saudi Arabia blackmails the UK

Just how far has the British empire fallen? The great colonizers are now cowered by threats from Saudi Arabia fearing the loss of jobs and defense contracts. It appears that the UK defense giant BAE set-up a multi-million dollar slush fund for Saudi princes in order to obtain multi-billion dollar defense contracts. When the Serious Fraud Office threatened an investigation the Saudis hit back threatening to cancel a $79 billion deal for Typhoon fighter jets and move work to France. Prime Minister Tony Blair stepped in and told Lord Goldsmith, the attorney-general, to drop the case. As Blair stated: “Had we allowed things to go forward, we would have done immense damage to the true interests of this country, leaving aside the fact that we would have lost thousands of highly skilled jobs and very, very important business for British industry.”

.China and Brazil set global prices for iron ore

Imperialist nations have always controlled the global commodities market by setting the international prices for basic resources. This year China has taken the lead for the first time on behalf of the steel industry, a role previously dominated by Japan. Lead by Baosteel, China will negotiate with Brazil’s Companhia Vale do Rio Doce, the world’s largest iron ore producer, to set world prices that will be accepted by the entire industry including US., Japanese and European transnationals.

China has also overtaken Japan to become the second largest spender on research and development expecting to spend $136 billion this year. Transnationals are starting to move genuine research to China because of the number of highly skilled scientists working in Beijing and Shanghai. Dirk Pilat, head of the OECD’s science and technology division says: “There are some signs that they are starting to do fundamental or breakthrough work ,” adding that the rapid surge in R&D has been “stunning.”

.Europe overtaking the US in capital markets

If China is overtaking Japan, Europe is overtaking the US. London is close to outdoing New York as foreign companies are rushing to London to raise money in global capital markets that exceed $250 billion. While already leading New York in foreign exchange markets for a good number of years, London is now moving ahead in new, over-the-counter derivatives. Pre-tax profits in Europe hit $31.3B, compared with $29.5B in the Americas and just $13.8B in Japan and Asia.

. Global “middle class” growing

The World Bank projects that the global middle class in growing. That is people with an annual income between the average in Brazil and Italy, or between $4,000 and $17,000. Today that makes-up only 7.6% of the entire world’s population. Doesn’t sound very “middle” to me. By 2030 the World Bank predicts this will grow to 16%.  Currently only six countries in the world have 40% or more of their population in the “middle class” to rich category. And if you have over $26,000 in assets (remember to subtract all your debt for cars, homes, credit cards, etc.) then you fit into the top 10% of the world’s well-off.