I remember decades ago when globalization was just setting in, I was already in Canada. New ideas and concepts always arouse my curiosity and I tried to find out what it actually meant to regular, everyday educated people. This is what I learnt.
Globalization was supposed to be an efficient means to advance the world economy. That with world population increases, faster and more efficient ways had to be constantly found for growing food, making goods and transporting them. In its simplest explanation, it meant each country would concentrate on what it best does and if most countries did it right, trade with each other would result in getting the most value at the best cost. What actually happened is worse than Modi’s recent demonetization. China had a cheap and huge fairly educated labour force spurred on by a dictatorship in place. It was sufficiently modern and industrial and able to copy patents and methods originating in other countries, either legally or through industrial theft. Soon everything the rest of the world made previously, began being given to China to make. This was the start of decay in the manufacturing cities of western countries that previously survived on making key products. Rochester NY the home of Kodak and maker of films, cameras and all kinds of photographic equipment became a ghost town. Detroit MI the hub of car manufacturing and America’s Motown became a city of decrepit neighbourhoods filled with people surviving on drugs and crime. Multiply these two examples a hundred times and it caused the polarization of America into the very rich and very poor. Well paying union jobs disappeared and the middle class was virtually wiped out. Corporate America thrived on profits from globalization. Products were sent to China and other low cost countries to make at very low prices and were sold at home at several multiples of that cost. Increasingly, most corporate performance metrics came to be based on quarters, not years or decades. CEOs and executives reaped rich bonuses and dividends. For the rest, life long company pensions became a thing of the past and regular work began to be outsourced to people in what they began to call a “gig economy”. Previously gigs was a label applied to musicians and artists who were paid for each gig or piece of work. Now those salaried workers of yore began to be called independent contractors and denied all other benefits besides payment for work. With untold wealth being shovelled their way (although they worked for it), China grew from a developing country, to be not only rich but today, powerful enough to challenge the supremacy of the United States. India got benefits too, but not for the reasons China had. India prospered because the enterprise of the private sector always innovative, thrived on liberation from permits and licences, despite bureaucracy and state corruption and because to the world, it was a large mostly open market. Where are we today? The global economy as it grew from the past 50 years is not sustainable with its current model. There are limited resources left to plunder, too much greed and too much poverty. Climate Change not just hovers on the doorstep but is breaking down doors and people with no food and shelter, living in critical war conditions will first inundate advanced countries and then become a source of unrest for the rest of the world. They will not be ignored because trade will be obstructed and no one will be allowed to make themselves a haven or sanctuary of peace and prosperity. Will there be solutions? Only if a set of leaders arise and take control of rich, powerful nations and of overpopulated countries like India and China, the latter two who involuntarily or not, control much of mankind’s Destiny. Roland. Toronto.
