What’s Wrong with Centralization?
One common centralization of authority definition that has remained ever so worrisome is from the Oxford Dictionary, which states that “centralization” “is the action or process of bringing activities together in one place” of authority. These past decades we have witnessed serious discussions about the two opposing concepts of centralization and decentralization and their possible impacts on human activities. This is the mind-boggling question everyone is asking right now: How long can we continue to remain stifled under a single centralization of power? Centralization Pros and Cons in other to fully understand what is wrong with centralization, we need to carefully consider the following facts:
• Centralization of Control: Today, almost all of our financial transactions are still conducted through the Central Banks in our respective countries. And there are restrictions concerning what nature of business transactions can be carried out under their watchful eyes. Imagine, the central banks in most nations are responsible for labelling bitcoin and other cryptos as not legal tenders within their economies, a declaration that we can all see as somehow misguided in order to protect their control on universal financial transactions.
• Centralization network: The recent Russia-Ukraine War exposes the darkest side of centralization. It didn’t take the United States and its allies more than 2-3 weeks to bring the Russian economy to its knees by systemically weakening the Russian currency, Ruble. In the end, it was ordinary Russian citizens that were exposed to the inflationary economy as they struggled to find the cash to solve their personal needs. The strongest force created by the centralization of banks that forced Russia out of the global SWIFT payment system had largely isolated the country and pushed Russians further into hopelessness.
• Centralization of information: Despite the explosion in the world population and the increase in our business and financial transactions, it is sad to realize that everything we do is still monitored and controlled by a few groups of central authorities. Even our personal information is being shared from one agency to another. Take, for instance, if you take some loans in Australia, the US Federal Reserve can access your credit information due to the partnership between Australia and the United States. We are virtually left with little or no privacy.
• Centralization in business: In our world, countries are divided into blocs. And each bloc has a set of rules and guidelines that explain whom they can do business. In essence, any country that is outside of the bloc can never grow because those in the bloc won’t be willing to help their economy grow and expand. Take, for example, many countries in South-East Asia and Africa cannot access the well-paying markets of Europe and North America simply because they are unable to make economic pacts with nations in those blocs. The centralization decision making gives the developed economies the power to decide whether they want to import things from the developing ones and support their economies. On the other hand, in the absence of centralized decision-making, an American can decide to import anything he/she likes from an African country without worrying that the goods will be ceased at the borders by the US Customs and Border Protection officers.
