Keith Rankin's Thursday Column
The Old Millennium
30 December 1999
"The further backward you look, the further forward you see."
Winston Churchill, quoted by Queen Elizabeth, Christmas 1999
Much of what passes for historical reflection in our media about the millennium has really been about the century; and,
at that, mainly that part of the century most of us alive today remember. (Talkback radio seems to be into 1960s'
nostalgia; nothing about Kupe, the Magna Carta, or the Opium Wars on that medium!) That's a pity, even from a New
Zealand point of view, because New Zealand has been settled for 1000 years, give or take a decade or two. Thanks to
James Belich and others, we know that Maori society was transformed mid-millennium as environmental feedback loops
We could learn quite a bit about our future just from reflecting on the unsustainable nature of Maori's first few
centuries, the pressures of zero-sum living following the depletion of in particular the moa and the fur seal, and about
the ways societies in different modes interact when they come in contact.
Before reflecting on the global millennium, I would like to assert that this year (1999) represents the simultaneous end
of a decade, a century and a millennium. Each deserves attention in its own right; decade-time, century-time and
millennial-time are quite distinct.
By our contemporary conventions (and I mean global Common Era [CE] conventions), the present decade ends tomorrow. Ipso
facto, the century and the millennium also end tomorrow. The Treaty of Waitangi was signed in the 1840s, and its 160th
anniversary is in the 2000s. (Should we call the next decade "two-thousands" - my preference - or the "twenty-hundreds"?
I am sure we will call the following decade the "twenty-tens".)
The global history of the last 1000 years has been far from a linear pattern of economic progress. Nevertheless it has
been one of social and economic growth, which, to European eyes, contrasts with the previous millennium which regressed
from classical glory to dark ages.
A millennial analysis has, I suggest, five elements: a global trend, a pattern of fluctuations or cycles, the emergence
and decline of particular "civilisations", the emergence and decline of social and economic in-groups within
civilisations, and a comparative analysis with previous millennia. With respect to the fifth-mentioned element, to
understand the "second" CE millennium, we need to understand as well as we can the first CE millennium, and the first
The trend that has given us long-run and potentially sustainable prosperity is capitalism. Capitalism is a product of
the medieval communes of Europe (the homes of the burghers and burgesses who became the bourgeoisie). It is a product of
a European culture of individualism that emerged about 1000 years ago from the forests of Europe, boosted by East Asian
technological innovations, mathematical concepts and monotheist religion arising from West Asia, and classical European
philosophy and medicine.
Under capitalism, the trend has been unsustainable growth, much like the trend of early Maori society. Yet that does not
mean that capitalism is not transforming itself into a sustainable form. Certainly, it seems better able to produce
sustainable growth than say Marxian socialism, which failed to survive for even a century.
Fluctuations can be exogenous (eg climatic change) or endogenous (arising from self-destabilising socio-economic
A Schumpetarian or neoschumpetarian perspective on economic change links growth to endogenous cycles. Joseph Schumpeter
- an Austrian-American economist of the early 20th century - is a name that will become more prominent as endogenous
growth theory develops. The key insight is that economic cycles are an integral part of the long-run growth process, and
not simply the nuisance that neoclassical and Keynesian economics assume them to be.
While Schumpeter himself focussed on century and decade time in his analyses of cycles and creativity, some economic
historians (eg Rondo Cameron and Joel Mokyr) whom he has inspired work in millennial time.
Cameron writes of "logistics", 300-year cycles that each include a period of rapid and progressive economic change, and
longer periods of relative stasis or consolidation. They draw on biological literature - eg concepts like Stephen Jay
Gould's term "punctuated equilibrium" - in which evolution takes part in comparatively short bursts.
An alternative theory of logistics (the Rankin version) goes like this: each century since at least the 15th has seen
economic change led by a particular factor of production. Thus the 20th and 17th centuries were centuries of Labour.
Indeed Keynes fully acknowledged the mercantilist economists of the 17th century as precursors of his thought. The 19th
and 16th centuries were centuries of Capital; of industrial capital and of expansionist European commerce. The 18th
century was - and not just in Europe - the century of Land; of the landlord, and of the group of economists known as the
"physiocrats". The 15th century was, in Europe, the century of free and prosperous peasant communities.
What's the betting that the Land (read environment) and property rights will become much more important than the labour
market as capitalism transforms itself once again? I am predicting that 21st century economics will focus on public
rather than private property rights, just as the environment represents land in its public form.
The concluding millennium also tells us that climatic change is important within millennial time. From c.1000CE to
c.1300CE Europe was warmer than it is now, with a benign climate and relatively few diseases. It was in that environment
that capitalism emerged. But it was in the problem-ridden environment of the "little ice age" that peaked in the 17th
century (think of Brueghel's paintings) that capitalism proved itself able to adapt, even strengthen, under adverse
For an economic historian such as Joel Mokyr, who specialises in technological innovation, the last millennium is a full
expression of "Cardwell's Law"; that the "torch" of human creativity passes, within millennial time, from one society to
another. As any successful society becomes conservative, the conditions are created whereby that society unwittingly
passes the torch of economic leadership to another.
Thus, for Mokyr, the 2nd CE millennium has been very much the European millennium, with the torch passing between
different European societies.
Europe emerged from being a global backwater in 1000CE to an ultra-imperial power for 500 years. The Chinese economic
miracle of 1000-1450CE gave way to a tide of sclerosis and decline.
Europeans and Mongols wrested the initiative in Europe and Asia from Islam and China. I remember in David Lean's cinema
epic "Lawrence of Arabia" a sheikh reminding Lawrence that, 1000 years earlier, Islamic cities had streetlighting while
Lawrence's forebears lived in small impoverished villages. Outside of Constantinople, in 1000CE, by far the largest city
in Europe was Cordoba, the Moorish capital, with half a million people.
The present millennium has not just been a single movement of an Asian-European see-saw. Given China's present economic
resurgence, China's millennial experience might be best described as "Coming Full Circle", which indeed was the title of
a recent economic history of the Pacific Basin.
Capitalism has enabled population growth to accelerate for most of the millennium. Further it has created the
demographic transition, which means that decelerating population growth is a feature of capitalism's most advanced form
to date; welfare capitalism. Ceteris paribus, population growth causes inequality as workers become abundant and land
becomes scarce. The miracle of capitalism is that its capacity for innovation has more than offset accelerating
population growth, to leave an overall legacy of less inequality than any time in history subsequent to the emergence of
So how does the last millennium compare with its predecessors? The first CE millennium saw the fall and rise of both
China and Europe, with Europe's fall being much bigger than its rise and China's rise being bigger than its fall. The
big winner of that millennium though was Arabia and Islam. By way of contrast, the first BCE millennium saw the
simultaneous rise of many civilisations, with philosophical and religious leaders emerging in China (Confucius), India
(Bhudda) and Greek Macedonia (Aristotle) at around about the same time. And African civilisation became most visible to
the rest of the world through its Egyptian portal.
Future millennia may see concerted global socio-economic development, or mutual decline. The new millennium will almost
certainly see the relative decline of "Europe", of which America is of course now the dominant part. This conclusion
directly contradicts the "end of history" thesis which suggests that the big story of the millennium has been the
establishment of a permanent cultural hegemony of Western Europe.
Finally, while on millennial time, the "coming full circle" idea can be linked to the phenomenon of globalisation. In
medieval times there were interconnected transnational communities of scholarship. In Europe, for example, there was a
Europe-wide scholastic language, Latin. Ideas and inventions flowed into and through Europe as if national borders did
Indeed national borders did not exist as such. They only came with "internationalisation" which is the carving up of the
world into the kind of nation states that emerged in western Europe mid-millennium. So, in a sense, the globalisation of
the first half of the millennium gave way to the internationalisation (on Europe's terms) of the second semi-millennium.
It is only now with the Internet - and with HIV/AIDS and emerging post-antibiotic diseases - that we are returning to a
post-national borderless world of more local differentiation (tribalism?) and a pervading sense of insecurity. This "New
Middle Ages theme was the subject of a 1994 BBC "The Late Show" television documentary.
For me, the two biggest stories of the century have been the growth of the world's food production outstripping
population growth, and the growth of democracy is all its forms. Both developments, of course, may be reversed next
100 years ago, the Malthusian conundrum of feeding a growing population was the major source of nervousness about the
future in Great Britain. The closer relationship between Britain and New Zealand (what James Belich calls the
"recolonisation" of New Zealand) was an outcome of that fear, as was the strengthening of empire. World War 2 in
particular represents the final working out of that fear, with Hitler seeking "living room" in Eastern Europe, and Japan
seeking a similar resource hegemony over East and South-east Asia.
Now it's a 180 degree turnaround. Assumptions that the terms of trade between agriculture and manufactures would mean
perpetually rising agricultural prices (as was the case in Europe in the early 14th century and Britain in the late 18th
century) to the point that we now assume there is no profit in farming and that there never will be anything but a glut
of food on the world market. A knowledge of the whole of the 20th century suggests to us that food gluts are not the
historical norm. The knowledge economy will be a complement to rather than as a replacement for New Zealand's
The last decade of many centuries has provided a window into the best part of the following century. Hence, we should
not eschew from reflecting on the 1990s in their own right.
The 1890s gave us moving pictures, cars, bicycles, Hollerith punch cards, the economics profession, the prerequisites of
power flight, and, if we include 1900, radio and Freudian psychoanalysis. For New Zealand, the 1890s was that critical
decade of recolonisation, in which the new staples of sheepmeat and dairy production (which totally dominated New
Zealand's 20th century economy) were established. The 1890s Lib-Lab governments of Balance and Seddon converted a
society based on property into one that looked to the management of the labour market as the focus of public policy.
The 1790s gave us the French Revolution and the Industrial Revolution, both critical indicators of the way the 19th
century would evolve.
The 1690s followed England's "Glorious Revolution" of 1688. As well as making a financial revolution possible, the
system of agricultural property rights was established that would lead to the full commercialisation of agriculture, and
the dominance of financiers and landlords ("gentlemanly capitalists") as economic historians Cain and Hopkins called
England's commercial establishment. This revolution also represents the beginning of political and economic liberalism,
symbolised by the philosophy of John Locke, published in 1690.
The 1590s gave us Shakespeare and Galileo. The 1490s gave us Columbus and Vasco da Gama whose voyages gave Europeans the
knowledge to exert hegemony over the planet.
The 1190s gave us Robin Hood. And the 790s gave us the Carolingian renaissance which saw the modern Christian calendar
adopted in Western Europe.
Maybe Kupe gave the news about the existence of Aotearoa in the 990s?
The 1990s and the Future
We can certainly get a more balanced view of the possible directions the new millennium will take by looking far back
into millennial time. At the same time, just focussing on the 1990s may tell us most about which of those possibilities
will predominate in the coming century.
From the 1990s, I am predicting that the Internet will prove to be like the car was in the 1890s and the radio in the
1920s. It will be ubiquitous next century.
The 1990s has given us endogenous growth theory, which will transform economics away from the equilibrium model that has
transfixed 20th century economics.
The last decade has followed from the rapid destruction of Marxist-Leninist "communism" as a viable economic and
political system. The story of the 1990s is not so much the end of communism, but the forms of tribalism that have
emerged in its place, and in a number of other places such as the Solomon Islands and Indonesia. The fracturing of
nations will be more a part of 21st century globalisation as are the neoliberal internationalist endeavours of APEC and
the World Trade Organisation.
The last decade has seen the explosive growth of biotechnology. Further, we are already moving into a post-antibiotic
era. Many of the 20th century certainties that we adhered to in the 1980s have gone.
The last decade of the 20th century has seen a marked decline in male labour force participation. The economic role of
men is in the process of a radical transformation that many policymakers have little inkling of. A report in yesterday's
NZ Herald - "Winz pushes for tougher line on jobless over-55s - suggests that New Zealand's 20th century public servants
are in denial about the changes in the labour market that affect, especially but not only, older workers.
A knowledge of our past can prepare us for our future. The twentieth century gives us many interesting stories, some
that have been lost in the superficiality of the lists we have been making. (I have yet to see John Maynard Keynes' name
in any list of 20th century greats.) Yet century-time falls between two stools. It is millennial time that gives us
perspective and context, while decade time today gives us a reasonably clear window for policymakers to focus through.
If only they would look.
© 1999 Keith Rankin
Thursday Column Archive (1999): http://pl.net/~keithr/thursday1999.html