Steve Jobs Didn't Save America; Nor Will Innovation

Owning neither an iPad, iPhone, MacBook nor whatever iGadget the Apple Corporation is flogging at the current time, I am not really a fanboy of the Cupertino concern. That said, I must admit that Steve Jobs' acumen for creating innovative products had virtually on peer--especially in his later years. Revolutionizing not only the computer but the film (Pixar), music (iTunes), and telecom (iPhone) industries, his broad vision of what's possible when combining new media with portable devices was truly astounding. Like many others, I recognize greatness when I see it.

I've been meaning to write this post for the longest time, but Jobs' passing has finally spurred me to do so. In discussions of hegemony, I keep hearing this refrain: "Why, US hegemony is secure. America has no match in terms of generating innovations used the world over. Look at Apple, Google, etc." As a marketing major, let me further observe that American political science people bloviating about innovation is particularly predictable since it's usually going to end up as another paean to the Enduring Greatness of American Innovation.

Having written quite a lot on the subject myself, let me instead tell you why contemporary innovation may be undermining America. To understand how this situation is possible, we need to update the states and markets debate. My argument is underpinned by the idea that what benefits corporations (American ones in this instance) does not necessarily benefit their home states. In other words, what was good for GM may have been good for America in 1955, but what's good for Apple is not necessarily good for America in 2011.

Without further ado, consider:

1. Innovation is not necessarily beneficial; consider financial innovation - It was not so long ago that American thought leaders alike Larry "Wooden Racquets" Summers in government and John Lipsky of JP Morgan then the IMF were all in a tizz over how we were entering a new era of financialization where risk would finally be conquered via the deployment of advanced derivatives. Supposedly, we were entering a time when our understanding of finance coupled with computing horsepower would enable us to quantify risks precisely and enable market participants to diversify risks to those who could bear them.

We all know how this American born-and-bred idea ended. It was an innovation that roiled the world, but most of all those who came up with such fantastical beasts in the first place. Colour me unimpressed. Not every US innovator is Steve Jobs, and one big, bad idea like subprime globalization has already swamped any number of helpful ones.

2. The relation of innovation to revenue generation is not necessarily positive - The California Myth is a regional variation of the American Dream that has been reinforced by, among other things, Beach Boys songs, Hollywood, pornographers in the San Fernando Valley, and oh, I almost forgot--Silicon Valley. Be that as it may, a remarkably consistent thing about California has been running among the largest if not the largest budget deficit for the longest time. In other words, the general public has not really availed of all the supposed fruits of innovation in one of the most innovative parts of the world. If Apple can't even save keep California afloat, how can it save America?

We return to a pillar of the global governance debate: What legitimately constitutes "We the People"? Politicians may be voted out of office via political processes with public sanction, but corporations have increasingly been able to use their clout to not only lower corporate tax rates at home, but also use transfer pricing strategies abroad to legitimately escape the reach of the tax man. They even openly advertise such strategies...visit Ireland! It is thus no wonder that US revenue collection is at an all-time low as a percentage of GDP. So corporations can earn billions and billions but the revenue collected by the United States of America is becoming increasingly minuscule due to constant pressure to reduce marginal tax rates and the commercialization of tax avoidance strategies into a veritable global industry.

How exactly do these help solve America's money problems? Simply, they don't. Tax avoidance is itself another brilliant American financial services innovation, so don't get me started. All I can say is, "We the People"--or even "We the Residents of California" haven't seen wondrous fruits of all this innovation especially as of late.

3. Innovations promote "creative destruction" of entire industries - Schumpeter wrote about innovation resulting in the demise of old industries as new ones superseded them in terms of consumer appeal or technological advancement. Well, consider how American film and music industries have fared in the Internet age. The recording industry has plummeted in recent years as high-bandwidth networks have made it possible to pirate virtually all new releases from whatever T&A bimbette the majors are promoting as well as the entire back catalogues of established artists. Ditto for books, films, TV shows, and video games--though they have suffered less due to mitigating factors such as the continuing appeal of physical media, movie theatres, and online multiplayer interaction.

While there are indeed many iTunes customers, it is generally accepted that those using pirated software remain far more plentiful. On one hand the Internet age made nearly limitless amounts of copyrighted material accessible for "free," while various Apple iDevices have made them more convenient to access. There are excellent reasons why the likes of Apple don't use zero-loophole digital rights management (DRM) implementations. It is tacit acknowledgement that rampant piracy which has terminally damaged a large part of American entertainment industries is here to stay since it benefits hardware sales, Anti-Counterfeiting Trade Agreement (ACTA) be damned (more on ACTA later; stay tuned).

4. The global supply chain inevitably results in leakages of proprietary knowledge - While branding and product design remain far more lucrative than simply manufacturing components to spec, spillovers effects do occur which benefit host countries. In time, these host countries eventually develop designs which rival those from the ones originally OEMed abroad by home countries alike the US.

Once more, technological innovation actually harms the US cause. For instance, it took years for the United States to copy textile manufacturing equipment from the United Kingdom. However, today's near-instantaneous communication of massive amounts of data makes it easy to replicate erstwhile trade secrets and copyrighted material (see point#3).
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All in all, then, the honest truth is this: It is likely no coincidence that America is being flushed down the toilet of history at the same time that Apple Inc. has become the world's largest (or second largest) company. Its success has been built in no small part on diffusing innovations that facilitate the undermining of copyrights and other forms of intellectual property. If Apple's market capitalization reaches $1 trillion out of creating value for others, more power to them. All I can say is that's it's far from certain that it will be creating value for America as we know it. More so in this day and age, American corporations' interests do not neatly coincide with those of America. Apple products may be insanely great, but America certainly isn't. Not by a long shot.

Chew on that, America #1 cheerleaders, as you read this on your iDevices.

UPDATE: Someone over at Free Exchange make Jobs' passing a warning about how inequality has sharpened during an age of intellectual innovation. Same banana: technology companies do not really benefit "America" via large-scale job creation, but only a select few.

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US-Colombia FTA Looks Set; Korea, Panama Await

It was written in the stars above that Obama the candidate would bash trade and discuss "renegotiating NAFTA" to court union support crucial to Democratic get-out-the vote efforts. Obama the (jobless economy) president however has become quite anxious as of late to sign trade deals to hopefully generate some US jobs out of no small amount of desperation.

In case you missed it, the Obama administration is busying itself with completing the leftover trade deals from the Bush Minor administration. Unable to get the Colombia, Korea & Panama deals done during the time when the last president still had fast-track authority, they've been stuck in limbo for years--though you wouldn't guess it by how much hype the USTR is now heaping on them. While the US Trade Representative Ron Kirk (remember him?) likes to say these FTAs will help achieve Obama's stated goal of doubling exports in five years, these are collectively not quite enough. Certainly KORUSFTA is nothing to sneeze at, but in the overall scheme of things it probably won't matter a great deal.

Nevertheless, in line with a major push by various government agencies to assist exporters big and small, we too have this rush to get trade deals done. First out of the chute is the one with Colombia. While (more protectionist) Democrats from states that perceive themselves as vulnerable to cheaper Colombian labour have long complained about the Latin American countries' anti-labour practices, I'd take it with a grain of salt:

The Senate Committee on Ways and Means has approved the U.S.-Colombia free trade agreement with 24 votes in favor and 12 votes against. Committee on Ways and Means Chairman Dave Camp said "These agreements enjoy broad bipartisan, bicameral support and are the product of a lot of hard work from all sides. I would also like to extend my appreciation to the president for sending these trade agreements to Congress." The free trade agreement will now go to the Senate Committee on Finance, and the full House before finally being sent to the Oval Office.

However assurances over labor rights which President Obama won from Colombia in the Labor Action Plan in April are not in the bill. "There remain troubling problems with how Colombia is addressing key elements related to the Action Plan. The flaws are magnified by the failure to incorporate the Action Plan in the implementation bill as a result of the adamant refusal of Republicans, and the Obama administration’s acquiescence to that refusal.” said Sander Levin Democratic Representative for Michigan.

The aforementioned Democrats have also been keen on extending Trade Adjustment Assistance (TAA) which is supposed to provide Americans who have lost (or will lose) their jobs due to trade liberalization with unemployment and retraining benefits. It was nixed during earlier budget quarrels since it was a $1B line item, but it has since been reinstated in a putatively more affordable guise as quid pro quo for passing these three deals:

The deals next ran aground when Congress, engaged in a broader fight over government spending, failed to renew TAA, a five-decade-old program that extends unemployment and health-care benefits to workers idled by foreign competition, if they seek job training. Republicans argued that the program, which costs about $1 billion annually, was too expensive and re-employment success couldn't be proven. [Democrats were reluctant to pass any FTAs without TAA extension.]

[Senate Finance Committee Chairman Max] Baucus [D-Montana] and [House Ways & Means Committee Chairman Dave] Camp [R-Michigan] together agreed on cuts to TAA benefits, reducing its cost. But bickering over the process for passing the scaled-back TAA program through both chambers caused further delays. Under a deal discussed last week, the new TAA program, which was approved by the Senate last month, would be passed by the House at the same time as the trade pacts, or shortly thereafter. The trade legislation would then proceed to the Senate.

With regard to the Panama deal, unionists have been wary of its status as a tax haven, though Panama has been willing to water down this status.

The Panama pact moved forward after that country enacted changes in law aimed at ending its status as an offshore tax haven, which has delayed the pact for several years.

Needless to say, there is an industry-led full-court press on the passage of these three FTAs. With what passes for bipartisan support circa 2011, I do believe that will go through this time around. Still, you do get the impression that they're too little, too late.

UPDATE (13 October): All three FTAs are now done deals.

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Singapore Slagging: Is Lee Kuan Yew History?

I do not believe that democracy necessarily leads to development. I believe that a country needs to develop discipline more than democracy. The exuberance of democracy leads to undisciplined and disorderly conduct which is inimical to development - Lee Kuan Yew in 1992 before the Philippine Business Conference

Ah, back to Southeast Asia. To get in the proper, ah, spirit of this post, you would ideally prepare a Singapore Sling cocktail for yourself. But today I will not mix it up with alcoholic beverages but engage in some Singapore Slagging. By the standards of that city-state, they are quite brutal, really. Having been at the receiving end of countless lectures from Lee Kuan Yew on the demerits of democracy including the rather in(famous) one above, I suppose us Filipinos can now heap some schadenfreude on the recent electoral comeuppance of his People's Action Party (PAP). With the Philippine central bank governor having recently been selected as one of the world's top practitioners, the economy is also beginning to show that democracy and growth are not mutually exclusive as Harry believes, either.

It is also good to recall that Lee Kuan Yew was not always sceptical about democracy. His opposition self (admittedly from a long, long time ago) sounded a different tune. A few months ago, I wrote about how the opposition won a far larger share of the popular vote than their meager tally of resulting seats in the legislature would indicate due to a heavily gerrymandered system of electoral districts. More recently, the PAP suffered another unprecedented humiliation since the time Lee Kuan Yew gained power. Although the post of president is largely ceremonial in Singapore's parliamentary system (modelled after Westminster), the PAP candidate nearly lost--and probably would have lost had there been fewer opposition candidates.

Longtime Asia commentator Amitav Acharya thus has an interesting contribution in Foreign Affairs where he considers what events in Singapore mean for Lee Kuan Yew and the PAP. While some even talk about an "Orchid Revolution" to match the "Arab Spring" and various colour revolutions in Eastern Europe, Acharya is more circumspect. Let us begin with the PAP taking more evasive action but ultimately receiving more warning signs that its time may soon be up with such a marginal victory in the presidential race:

Lee Kuan Yew, Singapore's storied first prime minister, gave his countrymen two things that elude most developing nations: stability and prosperity. Now, a new generation of Singaporeans with little recollection of Lee's crusade against poverty and violence wants democracy as well. In pursuing greater political openness in two elections this year, they are challenging one of Lee's most deeply ingrained beliefs: that development and stability do not necessarily go hand in hand with democracy...

Lee's son, Lee Hsein Loong, the country's current prime minister, tried to boost his party's approval before the August 27 presidential elections by increasing spending on health care and tightening control over immigration. He also announced a committee to recommend cuts to the salaries of ministers and the president, whose wealth is a major sticking point for the public.

But his grasping did not prevent another setback. A record number of contestants (four, all with the surname Tan) threw their hats into the ring for the presidential election. The candidate with the closest ties to the government, the former cabinet minister and deputy prime minister Tony Tan, won with 35.2 percent of the vote. His margin over the nearest rival (Tan Cheng Bock, a legislator from the PAP who maintained his distance from the party) was only 7,269 votes, or 0.34 percent. Tan See Jay, a candidate from the opposition party, got 25 percent of the vote. And Tan Kian Liang, another candidate, got 4.9 percent. Had the field of contenders been smaller, it is unlikely that Tony Tan would have won.

To be sure, ordinary (read: non-expatriate resident) Singaporeans have grievances that they perceive aren't being addressed and that the PAP only has begun to grudgingly tackle:

Voters want greater government accountability and transparency and better handling of the issues that affect ordinary Singaporeans. It is commonplace in Singapore to hear complaints about the growing rich-poor divide; higher property prices; rising cost of living; and congestion, overcrowding, and growing unemployment caused by a recent influx of immigrants.

Many Singaporeans feel that the ruling party has lost touch with the public, since it failed to recognize, much less fix, these issues before this year's elections. For their parts, both opposition candidates argued that Singapore's social problems could be addressed if the president, who is directly elected but has a limited role, were given more power to advocate on behalf of the people. Of course, Tony Tan's victory will keep the president out of politics for now, but the onus will be on him to win the hearts and minds of the overwhelming number of Singaporeans who voted for the candidates who would have been more active.

The rest of the article goes into how, absent the debt of gratitude older generations feel having witnessed the gains the country has made under PAP rule, issues that would have been cause for raising a voice within the PAP are now resulting in exit given the emergence of viable opposition candidates. (This after a long period when the opposition contained only marginal figures on the political scene.)

My preliminary take is that part of what is happening is not a wholesale dismissal of the big [D]evelopment and small [d]emocracy configuration that Singapore has kept for a long time. After all, the PAP did secure marginal victories. The issues that opposition figures have been able to capitalize on do not appear to champion doing away with previous modes of development. Rather, the PAP is likely to have become smug and self-assured over many years of rule. (As an aside, the LSE for instance has many Singaporean students--many of whom would not be here save for the government assisting with their studies.)

Is the PAP encountering a loss of belief in the concept of authoritarian development...or a failure of retail politics? My belief is that it's more of the latter. If the PAP wants to maintain its grip on power, it would be wise for it to be more responsive to micro-level issues. With the old self-assurance not what it was, the PAP had better look inwards to rediscover what made it grow its base in the past. In other words, it must return to vote by vote, block by block retail politics.

The PRC should probably take note, too.

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Burn Econ Textbooks? Fly Away with Sooper Yen

It goes without saying that one part of the job description for an economic civil servant--spoken or unspoken--is to talk up the local economy. So here we have an interesting paradox for Takehiko Nakao, vice minister for international affairs at the Ministry of Finance. (Remember too that this post was once held by Eisuke Sakikabara, "Mr. Yen".) Instead of talking up how Japan is emerging from its lost decade or more contemporaneously from the recent earthquake, his brief is talking down the yen. While Japan has done much over the years to hedge against yen strength by spreading its production network throughout the Asia-Pacific region--"Factory Asia" some call it--ultimately corporate earnings must be reported in yen. And with a strong yen, earnings from abroad become smaller when reported in yen terms.

So here we may have an honest official not out of choice but of necessity. Among other things, he discusses how Japan's economy is every bit as crappy as those of the US and Europe in so many words:

Japanese currency tsar Takehiko Nakao said on Monday that current exchange rates do not reflect economic fundamentals and there is no reason for markets to regard the yen as a safe-haven currency. The yen has risen sharply despite Japan's difficult fiscal situation and the fact that the economy is suffering from the effects of the March earthquake, Nakao, vice minister of finance for international affairs, said in a symposium.

"Of course people can say the yen's rapid appreciation reflects a weak American economy and problems in the euro system, but the Japanese economy is also suffering from the earthquake and also we are in a very difficult fiscal situation and also a sustained economic slump...In my view there is no reason for the yen to be regarded as a kind of safe-haven currency," he said, adding that is why Japan has intervened in the currency market three times since last year to discourage speculative moves.

There is no reason for exchange rates to move in the way they now do and they do not really reflect economic fundamentals, he said. Japan has intervened in the currency market twice on its own and once jointly with other Group of Seven nations [after the aforementioned earthquake] since September last year to stem a rise in the yen that has damaged its crucial export sector and threatened to derail the country's economic recovery.

While Nakao may be the first official of his sort tasked with self-deprecation, let's think otherwise especially past the near-term. Japan being the most advanced and second largest economy in the world's fastest-growing region isn't going to change given the absence of near-competitors. Geography doesn't change, and there are advantages being (nearly) at the centre of it all. The deflationary situation in Japan is also harder to reverse given its worse demographic outlook than either the US or most of Europe. Demography doesn't change when set into motion, either. And once more, FX repatriation on a set basis will always be a fact of life for a chronic surplus-running nation. Given that the yen is freely traded while the yuan is not, we know which will bear the brunt. (Ironically it may be FX repatriation ramping up post-earthquake that's resulting in yen strength, but I'd like to see a year's worth of capital flow data before deriving such a conclusion.)

So there are real mitigating factors to Nakao trying to heap scorn on...his own nation's economy. While the yen certainly looks overvalued--I have no qualms about intervention at this time-- there are legitimate reasons why people are placing bets on it as opposed to the dollar or the euro.

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Greece Returns to Antiquity: The Barter Economy

Yikes! I wonder if Brussels' bigwigs figured this into the bargain. In development theory, one of the signs of advancement is moving more economic activity from the informal to the formal sector. Not only is activity in the latter more readily quantified, but it also facilitates both regulation and taxation to, theoretically at least, set standards for commercial conduct and generate state revenue. With regular currency (euros) at a premium for obvious reasons, it appears barter--trading goods and services for each other without the intermediary of regular currency--is back in fashion in Greece. The irony of it all, of course, is that barter was a common mode of exchange during the heyday of Ancient Greece. And so as it was during Greece's golden age, so it is again during its current nadir. From the New York Times:

Mr. Mavridis is a co-founder of a growing network here in Volos that uses a so-called Local Alternative Unit, or TEM in Greek, to exchange goods and services — language classes, baby-sitting, computer support, home-cooked meals — and to receive discounts at some local businesses.

Part alternative currency, part barter system, part open-air market, the Volos network has grown exponentially in the past year, from 50 to 400 members. It is one of several such groups cropping up around the country, as Greeks squeezed by large wage cuts, tax increases and growing fears about whether they will continue to use the euro have looked for creative ways to cope with a radically changing economic landscape.

“Ever since the crisis there’s been a boom in such networks all over Greece,” said George Stathakis, a professor of political economy and vice chancellor of the University of Crete.

Interestingly, the Greek government is now sanctioning these networks. In theory, their existence does undermine efforts to generate both economic activity and its accompanying (formal) revenue. In practice, politicians do know the harshness of conditionalities being imposed on the country by the EU/ECB/IMF troika. There may thus be few better ways to curry favour with the populace other than by condoning the informal economy:

Even the government is taking notice. Last week, Parliament passed a law sponsored by the Labor Ministry to encourage the creation of “alternative forms of entrepreneurship and local development,” including networks based on an exchange of goods and services. The law for the first time fills in a regulatory gray area, giving such groups nonprofit status.

Here in Volos, the group’s founders are adamant that they work in parallel to the regular economy, inspired more by a need for solidarity in rough times than a political push for Greece to leave the euro zone and return to the drachma. “We’re not revolutionaries or tax evaders,” said Maria Houpis, a retired teacher at a technical high school and one of the group’s six co-founders. “We accept things as they are...”

In an e-mail, the mayor of Volos, Panos Skotiniotis, said the city was following the alternative currency network with interest and was generally supportive of local development initiatives. He added that the city was looking at other ways of navigating the economic situation, including by setting aside public land for a municipal urban farm where citizens could grow produce for their own use or to sell.

I know, I know: these things sound very much like the proto-hippie communes anti-globalization types keep talking about. Still, desperate times call for desperate measures. While you do wish these folks well, you do have to wonder what effects popularizing such modes of trade will have on efforts to bring Greece out of its current situation.

Lastly, the BBC also has a video feature on this phenomenon.

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As Push Comes to Shove, UK is Still Part of the EU

Britain's place in Europe has never been quite at its centre. In particular UK Conservatives are usually viewed--with more than a smidgen of justification--as the most Eurosceptic of mainstream British parties. The graphic to the left requires little explanation as the supposed diminution of national freedoms in the EU is a constant Eurosceptic theme. Recall rather far-fetched plans [1, 2] to scupper the Lisbon Treaty circa 2009 by waiting for David Cameron to succeed Gordon Brown and force a UK referendum that would most likely have resulted in a big NO. (At that time, the Murdoch machine was still a force to be reckoned with there and would have undoubtedly done all it could to ensure EU anti-monopoly regulations would not constrain its UK media operations.)

Times change, however--sometimes for better, sometimes for worse. On the favourable side, Murdoch's grip on British politics has weakened over his media empire's infamous phone hacking practices offending common decency. On the unfavourable side, Europe's peripheral economies have dragged the whole integration enterprise into some disrepute. So the Tories are faced with two factors pushing their views in different directions: while the need to satisfy Uncle Rupert's EU-hating whims are on the wane, many in the UK increasingly believe they are being dragged into a fiasco they chose not to participate in (by keeping the British pound).

The Independent has a new article discussing how David Cameron is actually keen on staying in the EU that I will try to explain further afterwards:

Prime Minister David Cameron today said he would not support a referendum on UK membership of the European Union. It was revealed today that MPs are set to vote on a referendum within the next few months, after a petition with more than 100,000 signatures was submitted calling for the public to be given the chance to decide whether Britain should stay in the EU.

Speaking at the start of the Conservative Party in Manchester, Mr Cameron said he did not believe the UK should quit the EU. And he played down the prospect of the Government repatriating powers from Brussels in the near future. The Government's immediate priority on Europe is to get the crisis in the eurozone sorted out and revive the continent's economy, he said.

The Eurosceptic idea is to force a reluctant Cameron to hold a referendum on EU membership if voted for in the House of Commons. Despite not being binding, such a result would pressure him to do so--or so they hope. However, Cameron explains UK membership in terms of mostly economic benefits:

"They have got to do that now and get ahead of the markets now, irrespective of the changes the eurozone might choose to make in the future about having more economic co-operation, which I suspect they will need." And he added: "The Government's priority right now is to sort out the eurozone, get the European economies growing again.

"Let's get the single market working properly, because there are huge things we could do in Europe to help promote growth in Britain - get the single market in energy, finish the single market in services, open up European markets, make sure that we stop the costs that are being piled onto British business through the EU. Let's stop all of that."

Cameron & Co. have famously been dubbed the "children of Thatcher"--the lady who famously slammed her handbag in protest of perceived EU encroachments on British sovereignty. Yet while the UK has whinged about the size of its contributions (especially that which goes to ag subsidies) and the EU regulations foisted upon it (such as discontinuance of environmentally unfriendly incandescent bulbs), it remains a clear beneficiary of liberalization with the continent.

Which, of course, is keeping with how Thatcher imagined European Union: promoting the free movement of goods, services, and capital without sacrificing considerable domestic policymaking efficacy. The Conservatives would like more of the latter to be repatriated from Brussels, but they are constrained in this area by his junior coalition (and pro-Europe) partners the Liberal Democrats:

The Conservative leadership remained keen to repatriate powers from Brussels, but was "constrained" by the fact that they are in coalition with Liberal Democrats, he said. "This is a party that is committed to the return of powers from the EU to the UK," said [Foreign Secretary] Mr Hague. "We are constrained by being in a coalition on that subject, but that is something that I still believe in." He added: "It may well be one of the dividing lines in the general election."

Nuff said (for now).

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Russia Retires AK-47, Gun That Changed the World

In 1987, Susan Strange penned a remarkably lousy if widely cited IPE article on continuing American hegemony predicated on its purported dominance in the areas of security, production, finance and knowledge. In the security realm, she made naive count-the-weapons and tot-up-defence-spending arguments familiar to those who've played Top Trumps to figure that, gee, America far surpassed the rest. Which, of course, neglected American humiliation in Vietnam, followed by similar de facto defeats in Lebanon (fleeing after the 1982 bombing of Marine barracks) and in Somalia (fleeing after the 1993 "Black Hawk Down" incident in Mogadishu). With the white man currently unburdening himself of Afghanistan and Iraq, the existence of well-thought out insurgeny strategies or what some call fourth generation warfare (4GW) against erstwhile "powers" is not generally questioned...except by IPE folks who don't know any better. Despite worsening America's already bedraggled finances via these multi-trillion dollar boondoggles, Afghanistan and Iraq remain largely lawless areas.

Now, the manufacture of weaponry is intertwined with the course of economic history. Among other game-changers you can count the Gatling gun and the atomic bomb. But, it was a rifle whose gestation process began during WWII which has arguably had a far greater effect on democratizing (or proletarianizing depending on your ideological persuasion) the tools of violence and giving haughty Yanks their comeuppance on several occasions: General Mikhail Kalashnikov's AK-47. While improvements in its design have been made over the years--the AK-47 will never be the last word in accuracy--its brief has remained that of an easy to produce, low-cost weapon.

From the arsenal of a onetime superpower to being the weapon of choice of guerrillas, revolutionaries and terrorists the world over, everyone knows what you refer to when you mention the "AK-47." Hence, upon its impending retirement as a frontline rifle in the Russian military, Charles Glass (the journalist, not the bodybuilder) has penned a very interesting article on its long, murderous postwar history. Moreover, it's likely that thousands more will meet their maker being at the wrong end of an AK-47 given its continuing ubiquity:

Estimates of the number of Kalashnikov rifles in circulation run as high as 100 million, making it what the Russian president, Dimitri Medvedev, called "a national brand which evokes pride in each citizen". "It is the [Nazi] Germans who are responsible for the fact that I became a fabricator of arms," Mikhail Kalashnikov later said. "If not for them, I would have constructed agricultural machines."

Alike other innovations, it too diffused in its own way:

Mikhail Kalashnikov's assault rifle equalised the battle between modern western armies and third world liberation movements. It was to independence fighters what the Winchester repeater, the "gun that won the West", was to American frontiersmen. Only later did the Kalashnikov fall into the hands of drug traffickers, slave traders and terrorists. Modern criminals adopted it the way Prohibition-era gangsters had the famed Thompson or "Tommy gun", previously the weapon of the FBI and other G-men who were pursuing them.

It is very important because a soldier doesn't have university degrees," Lt Gen Kalashnikov said. "He needs a simple and reliable weapon ... There's simply no time to figure how to operate a complicated weapon and press many buttons when the enemy is advancing on you."

It was here in Southeast Asia where the robust AK-47 proved its mettle against the far more finicky M-16. Would the Vietnam War have ended the way it did had the US armed its soldiers with something easier to handle?

In Vietnam, the American soldier's M-16 may have been more sophisticated and powerful, but the AK-47 worked without jamming through mud and monsoon. Peasants from Southeast Asia to South America made it their weapon of choice, and its distinctive form ended up on flags from Mozambique's to Hizbollah's. The "Kalashin", as it is called in Arabic, also defined an era in the Middle East. Arab armies deployed it, as did Yemeni tribesmen, Kurdish guerrillas, Lebanese militias and the Palestine Liberation Organisation. A Palestinian friend of mine said of the Israeli siege of West Beirut in the summer of 1982: "All the real fighting is done with Kalashnikovs. The rest is just sound effects."

And so the characteristic ringing sound of 7.62×39mm round has resonated--the true shot heard around the world:

I cannot recall covering a war since my first, the Arab-Israeli War of October 1973, in which the Kalashnikov was not a salient feature. Zimbabwe African People's Union and Zimbabwe African National Union fighters carried them in Rhodesia, and the Eritreans fought with them against Ethiopia for more than 30 years. Hizbollah used far more AKs than suicide bombers against the Israeli army in south Lebanon, eventually driving it back into Israel. In Lebanon's civil war, nearly everyone used them.

And its history is still unfolding:

As with one person's terrorist being another's freedom fighter, a weapon symbolises freedom to one side and terror to another. To Vietnamese, Palestinians, Angolans and Guatemalans, the AK-47 was a tool for achieving justice...

"The AK-47 has become the world's most prolific and effective combat weapon," Larry Kahaner wrote, "a device so cheap and simple that it can be bought in many countries for less than the cost of a chicken." Kahaner estimates that the weapon kills about a quarter of a million people annually. Its victims are buried in the ghetto of south central Los Angeles, the forests of eastern Congo and the mountains of Colombia.

Kahaner has written a book and an earlier WaPo op-ed on the weapon. The AK-47's bloody if game-changing legacy will probably long survive the conversion of one superpower to a BRIC and another being flushed down the toilet of history via its current infatuation with economolesters.

UPDATE: No, I am not turning this blog into Guns & Ammo, but do read an insightful comparison between Eugene Stoner (inventor of the M-16) and Mikhail Kalashnikov on the occasion of the former passing away. At 91, Kalashnikov is still going strong.

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