Globalisation: time to look at historic mistakes to plot the future

6019

Joseph Stiglitz in The Guardian:

Fifteen years ago, I published Globalisation and Its Discontents, a book that sought to explain why there was so much dissatisfaction with globalisation within the developing countries. Quite simply, many believed the system was rigged against them, and global trade agreements were singled out for being particularly unfair.

Now discontent with globalisation has fuelled a wave of populism in the US and other advanced economies, led by politicians who claim that the system is unfair to their countries. In the US, President Donald Trump insists America’s trade negotiators were snookered by those from Mexico and China.

So how could something that was supposed to benefit all, in developed and developing countries alike, now be reviled almost everywhere? How can a trade agreement be unfair to all parties?

To those in developing countries, Trump’s claims – like Trump himself – are laughable. The US basically wrote the rules and created the institutions of globalisation. In some of these institutions – for example, the International Monetary Fund – the US still has veto power, despite America’s diminished role in the global economy (a role which Trump seems determined to diminish still further).

To someone like me, who has watched trade negotiations closely for more than a quarter-century, it is clear that US trade negotiators got most of what they wanted. The problem was with what they wanted. Their agenda was set, behind closed doors, by corporations. It was an agenda written by, and for, large multinational companies, at the expense of workers and ordinary citizens everywhere.

Indeed, it often seems that workers, who have seen their wages fall and jobs disappear, are just collateral damage – innocent but unavoidable victims in the inexorable march of economic progress. But there is another interpretation of what has happened: one of the objectives of globalisation was to weaken workers’ bargaining power. What corporations wanted was cheaper labour, however they could get it.

More here.