Globalisation: Did We Stretch It Too Far?

Globalisation refers to the integration of markets in the global economy, leading to the increased interconnectedness of national economies.  Markets where globalisation is particularly significant include financial markets, such as capital markets, money and credit markets, and insurance markets, commodity markets, including markets for oil, coffee, tin, and gold, and product markets, such as markets for motor vehicles and consumer electronics. Interconnectedness has also created inter-dependencies. The globalisation of language, media, information, attire, culture, food, sport, entertainment, taboos, behaviour and styles of human interaction is also a feature of the late 20th and early 21st centuries.

After years of hedging or discounting the malign effects of free trade, it is time to face facts: globalisation caused job losses and depressed wages, and the usual remedies – such as instructing affected populations to accept the new reality – aren’t going to work. Unless something changed, the political consequences were likely to get worse.

It was only a few decades ago that globalisation was held by many, even by some critics, to be an inevitable, unstoppable force. “Rejecting globalisation,” the American journalist George Packer has written, “was like rejecting the sunrise.”

The decline and fall of the Soviet Union came about not because of any lack of its military might. Rather, it imploded because the West, and specifically the United States, used freedom of thought, capitalism and the enormous power of the free market to marginalize, reduce, and collapse the Soviet Union. They simply couldn’t compete on any level with the West. From technology to the quality of life provided for its people, the Soviet Union became a nation without a future. United States has since then been leading a uni-polar world. The US dominance spread far and wide but did not see any interdependence.

China learnt from the Soviet collapse and decided to pursue the goal of global dominance, and become the second of the bi-pole. The first action was managing its domestic affairs. China imposed unprecedented restrictions on its citizens while introducing its version of state-capitalism. This combined thought control with billions in international trade that, in turn, has funded a growing and potent military armed with nuclear weapons. For China’s leadership, however, that is still not enough. The United States continues to dominate the 21st century.

Trump was the first US President to acknowledge that globalisation had resulted into hundreds of billions in investment, manufacturing, jobs, and entire factories leaving the United States for China. This created consternation, alarm and quite a bit of anger in Beijing, which had not expected America ever to acknowledge that China benefitted due to US policies and thought. China quickly recognised that if the U.S. continued to demand economic reciprocity, China could easily lose its ability to claim solo superpower status for the remaining decades of the 21st century.

It is not certain that Vladimir Ilyich Ulyanov, better known as Lenin, actually said, “The capitalists will sell us the rope with which we will hang them,” but if he didn’t, he certainly thought it, and if still around would like to claim that foresight as his own. China’s leaders have long believed that America’s unsustainable trade imbalance with China is that rope. US have given its technology, its funds and its markets to China and China now has the rope round the US neck. And this has not happen for the first time. Eighty years ago, it was Hitler and Pearl Harbour, and more recently 9/11. US have been attacked using US technology and US funds.

The interconnectedness of the globe and integration of the global-supply-chain of the contagion has been demonstrated by the pan-world spread of Sars-Cov2 virus within a few weeks. Can one ask for any higher efficiency of exchange?

The entire World in general and the US in particular need to revisit the idea of globalisation and reorient it to interconnectedness of national economies minus the public welfare including but not limited to food-safety, national defence, healthcare and national-leadership. Dilution of nation-state which has taken place over the last 3-decades has to make way for a renewed sense of patriotism that will protect our nation today and far into the future. SWAADHYAAY, SWADESHI and SWAAVALAMBAN are the mantras which were never obsolete but forgotten in the allure of ‘wealth-creation’ for ‘shareholders.’

 

(First published on 09 May 2020 on LinkedIn)

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Published by

Mukul Gupta

*Educator, researcher, author and a friendly contrarian* Professor@MDIGurgaon

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