Globalisation was touted to be the ultimate panacea for embellishing and enhancing the paeans of super capitalism. A seamless and unfettered cross border mobility of income and capital would turn the world into a borderless mega zone of trade and commerce. However, the much-trusted utopia is falling apart at the seams, courtesy some Teutonic geopolitical convulsions. As nationalism, protectionism, and a splintering of exclusive ‘blocks’ characterise the current world, doing co-operative business is at the cross roads.

Canadian economist, prolific author and currently a senior fellow at the Centre for International Governance Innovation, Jeff Rubin, pulls back no punches in a trenchant analysis of how a contrivance of inflation, sanctions and war would transform the world which we inhabit.

When an impudent Vladimir Putin invaded Ukraine in February 2022, the Western world came down upon Russia with sanctions like a tonne of bricks. However, as Rubin informs his readers, these sanctions, instead of acting as a deterrent, worked against the interests of the parties responsible for their imposition. For example, a blanket ban on fossil fuel imports from Russia has sent concerns of energy security soaring across Europe in addition to resurrecting coal, the dirtiest form of fossil fuel, the phasing out of which was the one uncompromisable and collective global aim. Coal consumption in Europe is up 20% since Ukraine conflict, while the Australian Newcastle coal is trending at an all time high of $457 a ton, over three times the price from only a year earlier.

Russia and Ukraine, both significant breadbaskets of the world and critical exporters of fertilizers, have seen the exports of food fall thereby driving the price of food. As a détente, the United Nations and Türkiye brokered a deal between Russia and Ukraine allowing the Ukrainians to transport grain via mutually agreed upon ‘corridors’ in the Black Sea. Ironically, once supplies commenced, the realisation dawned that most of the cargo was already covered by commercial contracts and was not meant to cater to the most needy and deprived. Thus, while Sudan received a paltry 65,000 tonnes of grain, self-sufficient Spain received a whopping 2.9 million tonnes, most of which went towards feeding Spanish pigs to produce its unique ‘jamon’.

China has also been at the receiving end of multifarious sanctions, from the United States. The Biden Administration In October 2022 issued new export controls to cut China off from certain semiconductor chips made with U.S. equipment in its bid to slow Beijing's technological and military advances. However, as Rubin informs his readers, while China can perfectly live without apple, but can Apple, with its $3 trillion market capitalization, live without China? Moreover, these sanctions have ushered in a new era in self sufficiency when it comes to the Chinese Chip and Semi-Conductor Industry. Data published by the International Semiconductor Industry Association (SEMI) reveals that China’s monthly wafer production capacity has reached 7.6 million pieces, accounting for 25.6% of global semiconductor capacity. Going by this trend, in 2024, mainland China’s semiconductor capacity is expected to continue leading the world with a growth rate of 13%.

Similarly, G7 countries opened the aid and quantitative easing faucet to the tune of $2.2 trillion during the COVID -19 pandemic. As a result, the US deficit tripled to 15 percent of GDP. While the central banks go on a rate cutting spree, Rubin concludes that a union of record-high deficits and record-low interest rates cannot last, and the split would only turn out to be quite painful at the end.

This is an important book for anyone wondering how to navigate life post-COVID, and most importantly, when inflation prices will, or ever, come down. As someone awaiting the whole world to upturn so that we can remake it anew with what we learned during the pandemic (WFH works, childcare needs more support, commuting to the office is no fun, etc.), I found this book validating, but also scary because of the interconnectedness that global mobility has encouraged......it feels very much like the "butterfly effect."

An important book…the world is so inter-connected. How does Ukraine and Taiwan troubles affect your country. What do sanctions actually achieve? I learnt a lot. Thank you to #netgalley and the publisher for an ARC.