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【Economics. What are the four theories which changed the history?】

《Keynes revolution which turns over the common knowledge》

Before Keynes, adopting economic policy, balanced budget plan,財政均衡政策 used to be common sense. It means that the budget on the nation and tax revenue is balanced, so what the nation gets into the red incur is out of question. The budget has to be built within the tax which was gathered.

When the economy becomes bad, the tax revenue decreases, so the budget does as well. When the budget on the nation decreases, the money doesn’t circle around the society

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【Economics. What are the four theories which changed the history? 】

《Keynes revolution which turns over the common knowledge》

As a result the economic becomes worse and worse. Thus when the downturn in economy is accelerated, more serious situation breaks out. It’s financial panic.

The thing in which Keynes is epoch making is he thought that even if getting into the red incur, it’s all right. Supply is too much but the demand is in lack, so the economy is bad. Then private companies dispirited, and decrease their employment.

If so, the nation gets into debt and should offer new jobs to…

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【Economy. What are the four theories which changed the history?】

《Keynes revolution which turns over the common knowledge》

…and should offer new jobs to the people.

In short issuing government bonds and the government should do public work. Then it’s all right. If doing the public work, there is business which construction company should do.

If the construction company builds the bridge over a river, various thing which is raw material like steel and cement are sold, then the profit on the company rises and jobs increases for its employees and their salary also increase. Or unemployed…

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【Economy. What are the four theories which changed the history? 】

《Keynes revolution which turns over the common knowledge》

Or unemployed people get job as well. If salary increases, the employees can go on a family trip or have a meal at restaurant. Then the sale on the restaurant goes up and the salary on its employees also rises.

Thus if the government does the public work, not only the salary on the employees in construction company but various people increase in the society, as a result, the consumption also increases. Its effect is bigger than the money investing into the public work.

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【Economics. What are the four theories which changed the history? 】

《Keynes revolution which turns over common knowledge》

For example, let’s suppose that the government did the public work with ten billion yen. The construction company which undertook the public work bought cement from its sale. The price on the cement was eight billion yen. Then the consumption of eight billion yen occurred.

Moreover the company which deals with cement bought its raw material of which price was six billion, then its consumption is six billion yen. As a result, the consumption of fourteen billion occurred.

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【Economics. What are the four theories which changed the history? 】

《Keynes revolution which turns over the common knowledge》

Thus as a result, the investigated first money circulates, increases, and causes an effect which is bigger than the investigate money. We call it multiplier effect. The multiplier is the number which is used to multiple other number. The first investment increases consumption in varied places as if it multiplied.

If falling into a bad economy, the government should issue deficient financial bonds and do public work. Keynes insisted like that, for he thought the…

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【Economics. What are the four theories which changed the history? 】

《Keynes revolution which turns over the common knowledge》

…for Keynes thought the multiplier effect made the economy go up. If the economy goes up, the tax revenue increases. If the tax revenue increase, the government can pay back the debt, so the nation can get out of the economic crisis.

Before Keynes, it had been thought the national finance goes into the red incur was out of question. Then the common knowledge was turned over by the theory of Keynes. They were absolutely astonished at it, so the theory has been…

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【Economics. What are the four theories which changed the history? 】

《Keynes revolution which turns over the common knowledge》

…so the theory by Keynes has been called Keynes revolution or Keynes shock. It’s the policy which has been conducted in Japan as well at present. If the economy becomes bad, issuing deficit financial bonds and doing public work. It has been often done in Japan after the war.

The former second Shinzo Abe Cabinet which formed at the end of 2012 promoted the expansion on the public work by issuing deficit financial bonds under the name of mobile financial policy.

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>> 1 メイちゃん、ありがとう！😊 【Economics. What are the four theories which changed … I am glad I was of help to you.😊

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【Economics. What are the four theories which changed the history? 】

《Keynes revolution which turns over the common knowledge》

It’s what is called アベノミクス.

As to the way of taxation, Keynes thought of a breakthrough idea. It’s a progressive taxation taking lots of money from rich people.

When the economy is bad, the poor don’t use money. On the other hand, the consumption by the rich isn’t so much. Large amount of money have stayed at the rich. If the government collects lots of tax from the rich and distributes the money to the poor with the form of social security, the poor consume and…

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【Economics. What are the four theories which changed the history? 】

…and the whole consumption in the society will expand, Keynes thought like that. We’ve taken the progressive taxation for granted at present, but it has been done after Keynes.

《Keynes was dead 》

Keynes was born at very intelligent home, and the place where he lived was also a high-end residential area, so he was the walking definition of an intellectual person, but therefore, there has been criticism that he made much of intelligence too much.

When the economy is bad, getting into debt and making the economy go up.

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【Economics. What are the four theories which changed the history? 】

《Keynes was dead》

When the economy goes up and tax revenue increases, paying back the debt. Keynes thought like that. Who carries out his theory. Needless to day, it’s statesmen, but they didn’t take into action as Keynes expected.

The economy has been up and tax has also increased. What do statesmen? As tax increases they try to increase public work more and more. Let’s decrease disbursement on the government so as to do away with the deficit financial bonds, if saying like that they will be repelled from voters or…

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【Economics. What are the four theories which changed the history? 】

《Keynes was dead》

…they will be repelled from voters and economic world.

As the tax revenue increases, so let’s increase public works more with the increased tax revenue, if saying like that it will be received well and they hope they will be elected again.

If doing public work more and making construction companies make a profit, construction companies may have offered the money for election, some of statesmen may count their chickens before they hatched.

Thus, even if the economy is good, doing away with the deficit …

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【Economics. What are the four theories which changed the history? 】

《Keynes was dead》

…even if the economy is good, doing away with the financial deficit is hard because of the intention of statesmen. Moreover if doing public work too much, its effectiveness becomes less.

When public work increases and it makes construction company increases, the new disbursement from the government continues to exist construction companies, so there isn’t enough money for other industries.

Actually, financial deficit has expanded in develop countries, and Japan has amassed a large amount of financial…

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【Economics. What are the four theories which changed the history? 】

…and Japan has amassed a large amount of financial deficit as well actually. As Keynes was worried about, statesmen didn’t take into action, and as a result, it has been said Keynes is dead.

《Neo liberalism by Friedman》

Then Friedman who is an American economist turns up. He has raised lots of disciples what is called Shikago School. He’s been a standard bearer on Neo Liberalism.

For example, he’s insisted that we don’t have to adopt the system on minimum wage. The minimum wage an hour is fixed in Japan, though there…

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【Economics. What are the four theories which changed the history? 】

《Neoliberalism》

…though there is difference between areas.

Without establishing the system, labor may have been forced to work hard like a horse with a low wage extremely. The minimum wage system exists so as to protect labors.

But Friedman thought that as there is the minimum wage system jobless people increase. Even if companies have willingness of employing, if the minimum wage is high, they abstain from employing.

On the other hand, if the minimum wage system doesn’t exist, companies can fix per hour wages with their…

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【Economics. What are the four theories which changed the history? 】

《Neo Liberalism by Friedman》

Companies can fix per hour wages at will, so they will adopt actively. If the whole society adopt positively like that, companies of which per hour wage or salary is low extremely can’t employ lots of people, so the salary level must have been fixed automatically. Leaving employment to the market, so it goes well. Friedman thought like that.

Friedman opposes himself to the system of house rent. For example, when the economy is up, the house rent goes up higher and higher, so the upper limit on…

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【Economics. What are the four theories which changed the history? 】

《Neo Liberalism by Friedman》

…so there is the system in which the upper limit on the house rent fixed for the people who can’t pay the house rent. On the other hand, Friedman insists on like the next.

If regulating the house rent, a landlord can’t make a profit, so it learns not to spend money on the maintenance for the apartment house so much, so descriptive apartment house increases, and the town can’t activate, therefore regulating house rent shouldn’t be done.

Thus doing away with the regulation by the government as…

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【Economics. What are the four theories which changed the history?】

《Neo Liberalism by Friedman》

Thus doing away with the regulation by the government as much as possible, then the economy goes well, it’s the way of thinking on the new liberalism which is typical by Friedman.

Friedman thought the system on doctor’s license is unnecessary. The number of doctor is limited under the system of doctor’s license. Even if when people are injured slightly or have a cold and consult a doctor, doctors are increasingly busy with those slight illness, and they can’t treat serious patients enough.

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【Economics. What are the four theories which changed the history? 】

《New liberalism which turns over the common knowledge》

Without being the system on doctor’s license, everyone can do medical care at will, so everyone can begin business at will according to demand, like the one who specialized in slightly injury or in serious sickness.

Then excellent doctors who have technical skill can be devoted to serious illness. On the other hand, incompetent doctors are weeded out by market force automatically, so the doctor’s license is unnecessary, Friedman has insisted like that.

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【Economics. What are the four theories which changed the history? 】

《New Liberalism by Friedman》

The most extreme insistence is liberalization on drug. As regulating drug, the ones who want it desperately buy it with high price in black market, so mafia can make a fortune. If making all the drug liberalize, its price goes down by market force, and if placing a tax on the drug, national income increases, so we should liberalize the drug, Friedman said like that.

《New liberalism has made the gap expand》

The insistence by Friedman which puts faith in market force breathed new life into the…

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【Economics. What are the four theories which changed the history? 】

《New Liberalism has made the gap expand》

The insistence by Friedman which puts faith in market force breathed in new life into the economic system by Keynes which comes in dead end. As making economic activity free, the economy becomes good partly, but it has a bad aspect of expanding the gap.

For example, joining in taxi business used to be regulated in Tokyo, but it’s relieved under the Koizumi government. Number of taxi company and the number of car used to be fixed until then, but the Koizumi government relieved the…

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【Economics. What are the four theories which changed the history? 】

《New liberalism has made the gap expand》

…but the Koizumi government relieved the regulation, and joining taxi business becomes free. As a result, the number of taxi company increases suddenly and its service has improved by severe competition.

Before liberalization, when trying to get in taxi for nearby place, there is atmosphere in which a customer has to ask apologetically, could you please go such and such place?

Then the taxi driver started suddenly in a crabby mood, or even refused customers, but nowadays, even…

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【Economics. What are the four theories which changed the history? 】

《New liberalism has made the gap expand》

But nowadays, even a nearby place, the taxi driver serves the customer politely, sure, please, please with smile, so its service has improved dramatically.

On the other hand, income on taxi driver has decreased extremely, for as being able to join in at will, so employees in other industry who were got downsized joined in taxi business. While the taxi business has accepted employees who were get downsized, the income on lots of taxi drivers have decreased extremely. If looking at…

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【Economics. What are the four theories which changed the history? 】

《New liberalism has made the gap expand》

When looking at the reality, we can’t assert easily that as long as leaving everything to market force, it’s all right. If increasing the number of taxi, a winner and loser become clear by the competition, and the taxi company which has a good service alone can survive, according to the theory on Friedman.

But we usually choose a crushing taxi. Then we don’t think we try to look for the taxi company which has a good service and to get in its taxi. Ranking them with the competition…

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【Economy. What are the four theories which changed the history? 】

《New liberalism has made the gap expand》

Ranking them with the competition on service is impossible. In short, there is a fear of falling together on account of the excessive competition.

New liberalism has been promoted in America and a big gap was born there, and a movement asking for reducing poverty and inequality occurred in America.

Regulation on employment has been relieved according to dispatch law in Japan, so a large amount of irregular employment was born, as you know the gap has expanded.

In a word, new…

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【Economics. What are the four theories which changed the history? 】

In a word, new liberalism may have been the theory on the side of winners.

《Economics changes》

As you’ve read until here, the contents of prescription by economists differ so much, according to the time. Even if being effective prescription just now, if the time changes, sometimes it isn’t useful. Then we need a new one. The new theory has been asked for economics, according to the problem in the time.

Behavior economics has been paid attention greatly in economics recently. For example, let’s suppose there were two good.

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【Economics. What are the four theories which changed the history? 】

《Economics changes》

The price of the one is 3000yen, and the other 5000yen. When two kinds of good of which price is 3000yen and 5000yen are lined up, almost all of people buy the one of which price is low.

But the moment putting the goods of which price is 10000yen, the sales on the goods of which price is 5000yen increases dramatically.

Human is mysterious. When choosing among premium, special and regular, we tend to choose special, but it’s not logical, being unable to express it with the economics in the past.

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【Economics. What are the four theories which changed the history? 】

《Economics changes》

Rational economics of conducting being based on logical calculation has been adopted until recently, but we can’t express some of our ordinary behaviors with the rational economics. Dealing with the psychology on the human makes us analyze why we take into action like that.

It‘s the sales on luxury brand which makes use of the psychology on the human well. When looking at the window, there is a watch of which price is one million and a half yen, or the one two million and a half yen. How expensive!

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【Economics. What are the four theories which changed the history? 】

《Economics changes》

They were so expensive that we’re overwhelmed and after that going into the store, there is other watch of which price is one hundred and fifty thousand yen. How reasonable it is! We thought like that carelessly, and ended up buying it.

We the human don’t always take into action coolly, being based on a logical calculation. It turned out that emotion or the state of mind influences over the economic activity. New economics has been founded like that even in modern era.

The attack on the economics like…

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The attack on economics like that is based on an inquiry, where have been we at present ? Where are we going?

【History. Past is constantly rewritten】

The author said he was going to express the history. When trying to put the history into a few words, its genre is enormous. Instead of the history on specific time, on specific area, thinking, what is the history? What is learning the history? Showing various examples, he was going to think.

Though it’s abstract a little, without paying attention to it like that, we can’t learn the history at all. Even if trying to learn by heart the name…

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【History. Past has been constantly written again】

Even if trying to learn the name of era, or events by heart blindly, it will never be true liberal arts.

《The one which is left as history and the other which isn’t》

We learn the subject of the history in the world at high school in Japan. The author said when learning it, there was seldom Islamic history on the textbook of the history on the world.

But when looking at the textbook recently, the story on Islamic world has been in detail on the textbook. On the other hand, there is hardly the history on the South America or Africa, for …

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【History. Without stopping, past has been written again】

《The one which is left as history and the other which isn’t》

…for there is the background that the subject of the history on the world has been made as the one of which center was Europe.

For example, when going to high school in Europe, there is the subject on the history alone. When saying there are two subject on the history in Japan. Japan, and the world. Then the European were surprised at it, why are there two? What is the history for each country in Europe?

What kind of position was its own country in Europe? The thing which…

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【History. Past has been constantly written again】

《The one which is left as history and the other which isn’t》

The one which was expressed is the history for them, as a result, the consciousness of the history on the world is poor. European history was imported and the history on the world has been made in Japan, so its content is that Europe is in the center.

There is the aspect dimension that the idea that the Europe is the center has been imprinted into our historic perspective unconsciously.

What is the history in the first place? There is the Christianity on the European historic…

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【History. Past has been constantly written again】

《The one which is left as history and the other which isn’t》

There is the Christianity on the historic perspective of Europe on its root. The Christianity on the historic perspective is a thing like the plan for the god.

Religion of monotheism like the Christianity, Jew, and Islam have thought that there is the beginning and the ending in the world. We call it doomsday theory.

As the god has created the world, there must have been its aim. There is the beginning and the ending in the world, then why has the god created the world?

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【History. Past has been constantly written again】

《The one which is left as history and the other which isn’t》

How does the world move for the plan which the god made? All the events in which the human is concerned is the process that the god’s intention comes true. The one which is expressed like that is the description of history on the Christianity. The story on the Bible is the phrase from the god, and the history is expressed in it.

On the other hand, there are the history book like 古事記, or 日本書紀 in Japan. When reading them, there is a mythology that gods got married and the Japanese …

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【History. Past has been constantly written again】

《The one which is left as history and the one which isn’t》

…there is a mythology that gods got married and the Japanese land was born, the mythology of the birth of the islands is written in them.

Not only in Japan and in European but everywhere there is the mythology and the story how we were born. For example, there is the mythology that their ancestor was a lion in Sri Lanka.

Whether it be the Bible or 古事記, we can write down them with characters, so we can read them. It means that there must be lots of stories and mythologies which we…

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【History. Past has been constantly written again】

《The one which is left as history and the other which isn’t》

It means that there must have been lots of stories and mythologies that we couldn’t express with characters. The ones who could write down with the characters could describe the story which was related to their origin.

The society on the Christianity accepted it as truth and created the history on the human race being based on the story.

It’s the time that centralization of which center was the emperor was established when 古事記 and 日本書紀 were compiled. Both of the Christianity…

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【History. Past has been constantly written again】

Both of the Christianity and the Emperor regime are, so to speak, the history of the side on winners. Then we can think the history is the story written by winners always, it’s the story for winners.

《Establishment on the progressive view of history》

Historic perspective on the Christianity being based on the Bible was the mainstream for a long time in Europe since the Ancient Rome Empire. It was in the 18th century which is the time of the thought of enlightenment is the big turning point. The thought of enlightenment is the one which …

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【History. Past has been constantly written again】

《Establishment on the progressive view of history》

The thought of enlightenment is the one of which reason and rationality is made much. Enlightenment is 啓蒙 in the Japanese. 啓 means open and 蒙 is darkness, so the 啓蒙 means opening darkness.

In short, giving reasonable thought to the people who do in the darkness of ignorance and teaching and guiding them.

It is said it’s time of science in 17th century before the one of enlightenment. Galileo and Newton were active and is discovered that there is physical law in natural world.

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【History. Past has been constantly written again】

《Establishment on the progressive view of history》

So some people who thought there was a law on the history appeared. Philosophers and thinkers who made much of the reason in the 18th century thought that the superstition spread in the medieval period when the Christianity ruled over the society, but the people escaped from the superstition and ignorance and could recognize the world with scientific knowledge.

The one which the philosophers and thinkers discovered the law in the history is the history makes progress. We call it the …

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【History. Past has been constantly written again】

《Establishment on the progressive view of history》

We call it the progressive view of history.

For example Hegel who was a German philosopher thought the reason makes the history improve, changing it into better one.

Marx who accepted the view on the history and philosophy be overly critical thought of material views of history. It’s the world makes progress gradually and reaches capitalism, and the capitalism comes to an end by socialistic evolution and the new time starts then, so it has been influence by the progressive view of history.

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【History. Past has been constantly written again】

《Establishment on the progressive view of history》

Besides, there is a one section that the bell rings the time when the capitalism comes to an end at the end of the first volume of the capitalism, and the idea on the Jewish and Christian doomsday theory reveals there.

The division into periods like the words of the ancient time, Middle Ages, modern era was born at the modern era. The premise on the division into periods itself is the progressive view of history.

The view of history that the history makes progressive is inherited in the…

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【History. Past has been constantly written again. 】

《Establishment on the progressive view of history》

The view of history that the history makes progress is inherited on the history in the world which we the Japanese learn, so the idea that the society makes progress has been imprinted in our mind without being consciously.

To be sure, it is fact that our life has been improved dramatically if comparing it with the one of the Stone Age or the Bronze Age, but being based on the law that the history makes progress, if thinking that all the countries and the nations have made progress until…

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【History. Past has been constantly written again】

《Establishment on the progressive view of history》

…if thinking that all the countries and all the nations have made progress until today and they continue to make progress in the future, it’s premature.

《Why have the great four civilization been left their marks on history? 》

Being based on various works and lots of knowledge on the human race in the past, and new things are made in the future, when being based on the idea, to be sure there has been the progress clearly, but we have to think of it again, the author said like that.

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【History. Past has been constantly written again】

《Why have the four great civilization been left their marks on history? 》

As the various works and lots of knowledge in the past were left as record, we could found something new on the top of it, but for the people who couldn’t left the record, it’s just that an oral tradition, so none of them were accumulated, as a result, it would never make progress as civilized society.

Actually various civilization could have been born in the past. It isn’t limited to the four great civilization, for the civilization was born both in South America…

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【History. Past has been constantly written again】

《Why have the four great civilization been left their marks on history? 》

…for the civilization was born both in South America and in Africa, but in the place where there was no way of recording it, though the civilization was flourished at some time in the past, there was none of progress after that. There have been lots of them at least in which we can’t guess what kind of civilization was flourished.

The civilization which has been left its mark is the one which there were various ways of recording like the four great civilization.

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【History. Past has been constantly written again】

《Why have the four great civilization left their marks on history?》

In short, characters and paper were invented and knowledge were accumulated, and being based on the knowledge, the civilization has made progress.

The author said he had to add so as to avoid misunderstanding. It doesn’t always mean that the race which has characters is great, nor the one which hasn’t poor. The people who happened to get the way of recording developed in varied ways, being based on the way of recording.

《Accumulating record keeps the act of folly away》

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【History. Past has been constantly written again】

《Accumulating record keeps act of folly away from us》

On the contrary, without learning from the past, we the human will repeat the same mistakes over and over again forever.

There has been civil war at various areas in Africa at present. For example, Congo has achieved the development in 1960, but after that the civil war broke out suddenly. PKO was dispatched from the United Nation for the first time then, but the civil war goes on at present from then.

South Sudan was independent June in 2011, but the civil war broke out suddenly again.

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