One of the fascinating elements of the post globalization changing world order, which I call the Interregnum, is the way alliances are breaking down (might a Donald Trump led America leave NATO?) and being built up (recall the idea of ‘The Fourth Pole’) as well as being disrupted (Russia’s de facto invasion of central Africa – see The Man on Horseback). The latest example is the fusing of bits of the ‘Quad’ with AUKUS (Australia, UK, US).
In ‘The Levelling’ we had described the Quad as the club of India, Japan, US and Australia, as effectively a bulwark against China’s influence in the South China Sea theatre. The new development, given on one hand India’s diminished credibility and commitment as an unblinking friend of the West, and on the other a renaissance in Japan’s economy and sense of itself on the world stage, is that there is serious talk of Japan being ushered into another geopolitical club (AUKUS).
Given that AUKUS was initially established on the premise of providing new submarines to Australia, and that it is now very unlikely to get these before ‘the next war’, Japan might want to think again.
For my part I have been trying to think of the things Japan has in common with the AUKUS countries (culturally and structurally it arguably has more in common with France). Rugby might be one, but America is not a rugby power, and neither does it have a royal family at the head of the state, though the Trumps might change that.
Appropriately though, given that the Augusta Masters is on this weekend, Japan and the AUKUS countries are all ‘golf states’. Indeed, granted that Russia, Iran and Pakistan are not golfing strongholds, the propensity of a country to play golf, might itself be a geopolitical identifier.
There are close to 40,000 golf courses in the world (according to Golf Monthly) with 16,750 in the US, then Japan second with 3,169, the UK and Canada (this week Justin Trudeau has also spoken warmly of AUKUS) next with over 2,000 courses each, followed by Australia (1,600). Some small countries – notably Sweden and Scotland have more golf courses than China (only 566).
If golf is a marker of Anglo-Saxon and/or bourgeois roots, it is also a tracer for speculation and excess. This week it was reported that the joining fee for luxury golf clubs in Florida has pushed into the millions in some cases, and has tripled in others. This is likely a sign that the local economy in Florida is strong, that the broad wealth effect in the US is robust and potentially that we may be seeing a wealth ‘peak’ in the US.
To bolster this view, consider Japan, whose stock market and property sector are just reaching levels last seen in the early 1990’s (while Tokyo prices have recovered to 1991 levels, the rest of the Japan’s residential market is still below the price point reached then). In the late eighties and early 90’s, Japan was the coming power (Ezra Vogel’s book ‘Japan as Number One’ was emblematic), so much so that Donald Trump went on CNN to castigate American foreign and trade policy on Japan, though he did state in the same interview that he had no designs on the White House.
One of the remarkable socio-economic trends in Japan at the time was the startling rise in Japanese gold club membership fees, which in the heady 1980’s Japan, had become a tradeable asset, so much so that an index was created (always a warning sign). During the period 1982-1989 the average golf club membership fee rose by 400%, with a final 190% spurt from 1989 to 1990. Companies such as Ginza Golf Services initially made a lot of money trading golf club memberships and at the peak of the market some were changing hands for close to USD 3mn.
The rest as they say, is history. In recent years the sport of golf has been in thrall to Saudi Arabia, whose version of ‘luxury’ capitalism has luridly distorted prize money and appearance fees. Interesting then that a couple of years after bidding up golf prize money stakes, the Kingdom is scaling back its ambitions for NEOM and The Line, two futuristic city projects.
It might be too early to tell if the golf curse has struck Saudi, and Florida for that matter, but it confirms a sense that in certain parts of the world the wealth effect is beginning to become disorderly.
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