BRIC Building

In economics, BRIC (typically rendered as "the BRICs" or "the BRICcountries") is an acronym that refers to the fast-growing developing economies of Brazil, Russia, India, and China. The acronym was first coined and prominently used by Goldman Sachs in 2001.^[1][2] Goldman Sachs argued that, since they are developing rapidly, by 2050 the combined economies of the BRICs could eclipse the combined economies of the current richest countries of the world. The four countries, combined, currently account for more than a quarter of the world's land area and more than 40% of the world's population.^[3][4]

Goldman Sachs did not argue that the BRICs would organize themselves into an economic bloc, or a formal trading association, as the European Union has done.^[5] However, there are strong indications that the "four BRIC countries have been seeking to form a 'political club' or 'alliance'", and thereby converting "their growing economic power into greater geopolitical clout".^[6][7] On June 16, 2009, the leaders of the BRIC countries held their first summit in Yekaterinburg, and issued a declaration calling for the establishment of a multipolar world order.^[8]

The numbers came from Wikipedia. I don't normally like using their stuff but in this case they have some really good sources and it's far better than a summary I would have written. Do check the articles they linked to for some more background reading to this post. I've already written an article about Russian foreign policy and about Chinese fiscal policy, but I have quiet till now about Brazil or about the BRIC as a whole. In light of the recent pick of Rio de Janeiro as the location of the 2016 Olympic Summer games I'd like to change that.

Back in July, there was a G8 summit to discuss the global financial situation, which I suppose is the only thing that the G8 does (the G8 is a group of the leaders of the 8 largest economies in the world) but I didn't want to make that such a short sentence. Brazil, China, and Russia went and said that they wanted to shift the global currency away from the US Dollar. No real alternative was given and discussion on the topic wasn't even really held. The thought of ending the United States' financial dominance, however, was out in the open. According to Forbes shortly after,

A possible BRIC replacement for the dollar has more to do with a political and economic power struggle than with getting a stronger currency as the world reserve. "[The BRICs] 'have to' if they want to be able to exert their desire to be taken more seriously and seen as real economic powerhouses on the world's economic stage," says Stephen Roseman, manager at Thesis Capital.

If you actually look at that link don't give me any guff about the titles being similar, I hadn't read that article since July. China is especially wary of the dollar's current dominance in the markets. They have been trading for a lot of dollars and they are now the US' largest lender. What this means for China's economy is that if the bottom falls out of the dollar and it becomes worthless, so does the yuan. Rather than buying fewer dollars and allowing for less risk China has been buying more dollars and looking for more profit. They are in almost no position to jockey for becoming the next major currency. As TIME put it, "Don't expect to change those greenbacks for redbacks anytime soon."

Barack Obama tried to hit the big reset button with Dmitri Medvedev, the President of Russia, in an attempt to warm the re-cooling feelings between the two nations. Russia invaded a smaller country during last year's Olympics, has quietly supported Iran's nuclear program, and has been knocking heads with the United States over plans for missile defense shields across Europe. Russia left Georgia and has presented evidence that they were provoked. Iran is finding support from many more places than just Russia. We aren't putting our missiles in Europe. It seems that Russia has won three major battles. However not everything in life is what it seems. During Obama's visit in Russia, he and President Medvedev agreed to cut each nations nuclear arsenal by almost a quarter in seven years. Russia is going to allow us to fly planes through Russian airspace en route to Afghanistan, a move that helps both countries. The missile defense shields were really only ploys by George W. Bush to upset Russia in the first place so they were easy to give up.

Russia has even begun to lessen its support for Iran's nuclear program. Part of this may come from Ahmadinajed's widely-thought rigged election and increasingly anti-Semitic tone, and part of it may come from the previously mentioned nuclear agreement with the United States. This is incredibly important for more reasons than the preservation of Israel, which I won't discuss any further here. I personally buy into the Samuel Huntington theory of the Clash of Civilizations to a point. I think that Iran, formerly part of the Soviet Union, has enjoyed support from Russia for a long time and with that has been much more comfortable going against our wishes. Since Russia maintains a permanent seat on the Security Council at the UN, they are able to veto any meaningful action against Iran. However, with Russia starting to question that support, Iran might find that a decision to turn a peaceful energy source into the most powerful weapon in history would be the opposite of desirable. I had mentioned that there are other reasons for Russia to put pressure on Iran than to prevent 'the bomb.' Iran controls a major portion of the world's oil supply. While the popular media in this country would like to make us think so, we are not the only country in the world that requires oil from the Middle East.

Iran recently re-elected President Ahmadinajed in what many called a rigged election. The opposition rioted in the streets and was beaten back, literally, by state forces. I was asked by a very good friend about my opinion on the matter and I am afraid I did not provide a very good perspective on the matter. I would like to fix that now. 30 years ago the United States put the current Supreme Leader into power by supplying him with weapons and money secretly so that they could fight off who? Islamic extremists and Russian influence. Oops. I stated that doing the same with the new uprising would hardly be prudent because of past failure and probable renewed failure. I was correct, but that is hardly helpful to the conversation. What should happen in Iran is Russia should use its considerable influence and limit nuclear desire and help international agencies make sure that the next election is open and fair. Russia has certainly had its own trouble with fair elections but maybe working to make Iran more democratic will help it look in the mirror.

Ok, I've covered China's economics and Russia's diplomatics. Familiar territory for many writers and especially this one. Let's delve into some less familiar space on the atlas.

Another former colony of Britain, India is an up-and-coming player in world economics and politics. It is the seventh-largest country by geographical area, the second-most populous country, and the most populous democracy in the world. India is another country that has dealt with terrorist attacks in recent years. Attacks on a hotel in Mumbai came from Pakistan and, according to Forbes, funded and armed by China. India is dealing with the growing pains of industrialization and moving into post-industrialization. The location of many outsourced technical support jobs and the homeland of many foreign students and doctors, India is now starting to outsource its own tech jobs and as the education debate rages on in this country it is also the home of ideas for better teaching. India is also the home of new companies that are making smaller cars and cheaper laptops. As these new technologies come out of the largest democracy on the planet, the middle class will boom and their growing economy will continue to grow and we might soon start asking them for the loans that China can no longer afford to give.

Lastly: Brazil. Home of Rio de Janeiro and the 2016 Summer Olympic games, Brazil is perhaps the country I'm most interested in that I don't hear enough about. A couple years ago they found oil just off of their coast and as soon as that oil hits the market not only will the price go down but the economy of Brazil will explode. A side note: gas prices should go down when it hits the market because we will have an option for oil imports that isn't Iran or Venezuela. It should not be taken at face value that Rio was 'awarded' the Olympics. Rio is a beautiful city with a vast population but that is not the only reason they were picked. Rio is the first city in the southern hemisphere to host the summer games as well as the first city in South America. (NOTE: Thanks to one of our dedicated readers I have learned that part of that statement is false. Australia hosted the summer games in 1856 and 2000. I heard that statistic on television and didn't bother to check the facts and I apologize.) The games have been in America, Japan, and Europe before. I don't think that the choice was a move against Obama but a move for Brazil. Obama should publicly embrace the choice and speak proudly of Brazil as an American brother. This could be a very important friendship in a continent, and a world, where our list of friends is somewhat shorter than it used to be.

Each of these four nations still has a little growing up to do. I have listed them in a very particular order: China, Russia, India, Brazil. I don't think they are quite ready to be the foundation, or BRIC, for the world yet because they are still each in their own CRIB.

China needs to bring its poor into the 21st century and make the middle class vastly more independent economically. Russia needs to stop playing Cold War politics and realize that we are in a new world with new problems and they can't keep blaming us for everything while their people starve. India needs to find its own voice and become the kind of regional and global leader that its economy and population allow. Brazil needs to grow out of its former corrupt shell and also lead South America towards freedom from fear and foreign influence.

Once they have each done that they may become the BRIC that we can stand upon to find our own place in a world where we aren't the only superpower and where we must rely on others for survival.