Economy Warfare

Economy has since been part of human civilization. Together with other social system, it make civilization sustainable. The influence of economy become greater when the standard of living of each become better. "Too much to lose" and "Something to lose" make military solution less desirable when come to political dispute. Invasion are no longer within the scope of physical intrusion. Economy has evolved into a tools to extend one nation power to control over others. It has now become a very important national security matters. In modern day, who control the economy take command.

The first economy weapon - IMF. IMF was established on July 22, 1944 at Bretton wood conference to stabilize international exchange rate and assist the reconstruction of international payment system after post-worldwarII. It since become a tools of great western civilization to exert their influence economically to the rest of the world. It was a desperate time for most of the nation to recover from it devastating state after post-war period. Resources was scarce. It was very justified for most developing countries to turn themselves to IMF for monetary assistance. The IMF then will impose rules and regulation to country who ask for assistance, on how they should run their economy policies, hence indirectly directing the social structure of the country. Such instrument was the on of the kind solution for west to keep their control power over the world. It was a brilliant idea at brilliant timing.

The Second instrument used in economy warfare is fiat international currency. The nation who her currencies is nominated at the sole single international trade currency will have the privilege not only control over the international trade, but literately able to enjoy free commodities and products from the rest of the world.

The third kind of instrument is financial instruments that has become greater in term of its complexity. The derivative and leverage market has the power to overnight tumble a nation economy. Economy pitfall during 1997, 2000 and 2008 were great example for what derivative market can do to the market. It is a time bomb that nurture economy perfect storm. As the concept of money and trade become more virtual and electronic, the efficiency for economy damage to spread are at the speed of light.

The fourth kind of instrument is debt. Debt was never a concept that well accepted until recent day. Debt was perceived as evil and bad during our grandfather time. But it was history. Today economy, debt was the main propulsion system that keep it run and growth. Banking system promote debt. People has to take debt in order for economy to growth. It a U-turn road. Houses, cars, educations, vacations and household expenses, are all feed by debt. It make human to become slave to pay back the debt. It was the ultimate weapon to control over billion of population.

For all instruments discussed above were just some of the example of how economy become a weaponary system in modern civilization. The reality of economy warfare cannot be undermined given the potential treat to our world stability. With collapse of one economy, military resolution will become inevitable. The good news is, it is possible to have a win win version economy environment. It is up to political leaders of great nations to face the reality, to decide, if not make move, to create the version of future that is good for everyone or otherwise.

The Universal Economic Formula

Since human began to form complex civilization, economy and trade has became the beacon of stability. Stability is important for peace and growth of the society. Without stability, a civilization can fall. 

Knowing the important of economy within our civilization, it is essential to develop a right formula to produce a right equation with the right variable. Since industrial age, economist had cracked their head to seek for the right answer. With trial and error, empirical experiences has contribute a significant progress to the finding. 

The history has shown us that ineffective economy system and poor implementation will hamper the civilization progress. It take a good implementer with a right system to produce sustainable economy ecosystem. However, there is no universal economic formula. The reason is due to the nature of economy itself is made of people, tradition and culture. With different situation, culture and environment, one kind of system can outperform others. While some system are good at beginning, but require radical changes when certain milestones is achieved. The key to success is to acknowledge the formula is rather dynamic than a constant equation. It require continuous progression, versatility and adaptability to react with social environmental changes. 

Capitalism and laissez-faire free economic system is considered to be as our current mainstream, most advocated effective economy system preached by the west. The america empire is the ambassador for the capitalism economy model. The system work so well (Even not until recent days) is mainly contributed by the nature of the american culture which are more to individualistic and self-dependency. The discipline of each of individual to take hold their own fortune condition and wellness as their own business to take care. Such culture and environment favour capitalism to work. The invisible hand of adman smith is strong under such given circumstances. However, it does not work well in the eastern nation counterpart such as China, Korea and Japan.

Japan was at his pinnacle of  economic achievement at mid 1980s. She become the next economy power house next to america from the state of poverty and at the brink of total collapse due the product of post-war. However, the economic miracle was not the product of capitalism. It is socialism in principle but capitalism on wealth distribution. By monster Sahashi, the ministry of MITI, Japan Inc was formed. It was a government bureaucrat center planning model which dictate the course of economy path by induce incentive to favoured industry, and implement protectionism to protect local businesses from foreign treats. It is a model where government in principle control all the capital and resources, and decide who and how it should be utilized. It is believed that, a center controlled system can eradicate wastes due to overlapping efforts by private sectors during the trail and error to achieve development progress. It is believed that, by putting together the resources, the center government who think they know what is best for the country can be more effectively allocate the resources to produce a much better result. It work well, and successfully transform a country that has nothing in principle (Natural resources) to a country that produces almost everything from heavy industry to electronic to automotive, to consumer products. The hindsight, that socialism tremendously work well in Japanese society is contributed by her society tradition, culture and environment. The Japanese are collaborating in nature, and less individualistic. They believe in the society system that ruler is what decide the course of nature of any future event of society, good or bad. They are tuned in the mood of following vision of the ruler, and work the best out of themselves to achieve each given tasks. They are less self-interest and believing in serving something bigger than themselves for the betterment of lager picture - the society as a whole. They able to endure delay gratification in nature, and preaching the idea of work hard for the nation is a noble. Such environment making socialism the most effective system suitable to Japan, and also China, Taiwan, Korea and Singapore who somehow share the similar culture and societal belief. 

The concept of economic formula is rather a dynamic tuning and discovering process rather than a universal static equation. It is a conditioning formula decided by its variable such as economical and societal culture changes. It means, a well proven successful formula might work well at certain given time, conditions,  nation and cultures, but could not sustain a different set of situation. There is no universal economic formula.