Are we all complicit in globalisation?

Are we all complicit in globalisation?

June 25, 2018 0 By Michel Santi

Milton Friedman maintained the theory that unfettered free trade would generate – in the long term – a wealth that would trickle down over everyone. Contrary to the ideas made out, the liberalisation of trade (which goes hand in hand with the free circulation of capital) is not the only reason for the world’s dramatic drop in poverty. In truth, it’s between 1950 and 1970 – that being before the imperiousness of globalisation – that the number of men and women living on less than a dollar a day was significantly reduced, and that the most notorious progress in medicine and science was made, benefiting the poorest people. However, it would be counter-productive to vilify globalisation since the global take-off in trade can’t be brought back to a negative-sum game.

Nevertheless, the protectionist doctrine is prospering since the citizens of certain countries are suffering the fatal vagaries of globalisation which is starting to have a negative impact on their purchasing power and employment. This is why the passionate debates of these last few years – which has been unrivalled the last few weeks with the untimely and unilateral decisions of Donald Trump – are all coming back to trip up over the essential issue of the level of protection that a state should lend to its workers.

In this respect, it goes without saying that it’s the most vulnerable who routinely find themselves on the wrong side – that of anti-globalisation – since it’s obviously they who are most in need and most in demand of protection, contrary to the most well-off who hold reserves that are more than enough to continue navigating through trade wars and wage dumping along with the total collapse of barriers. It is first and foremost, and almost exclusively, the rich and most fortunate who are benefiting most from the drop in prices that has come from globalisation. This has in fact had a negative impact on low wages, that have a clockwork tendency to be compressed even further.

A social ravine has therefore been dug between those who are connected – the cosmopolitans and the border-hoppers who have been able to exploit this new globalised economy – and the others who find shelter in their small communities. Globalisation – which was once only economic in nature – has gradually had highly perverse asymmetrical effects on our Western nations since this ditch has become social and even cultural. This is how economic populism was born, and it has stemmed from inequalities and the concentration of powers. Also, it’s the attitude of “mainstream” economists and politicians, who have had a deplorable and routine tendency to hide behind globalisation, that has managed to convince this economic populism of its legitimacy.

These “elites” – who have indeed become globalisation fetishists – have greatly helped divide Western societies by only considering the positive ramifications of globalisation, all the while disdainfully brushing aside its harmful, even cruel aspects. The left, however, hasn’t stopped pleading for investment in infrastructure and education, believing that these are the only things that would allow us to fight against this new highly competitive environment. The right, for its part, has ardently defended tax reductions and more supple regulations, meant to attract international investors. In short, both left and right have formed an objective, paradoxical alliance, since their respective agendas have been underpinned by a race to gather the best weapons to win this globalisation battle. It’s a fatalist – even defeatist – attitude since, in doing so, the left and right have admitted implicitly that we had to bend and adapt to its rules!

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