I used to follow the debate on globalization as a student and practitioner of development economics in academic literature or through cursory media coverage of a bunch of youngsters protesting outside annual meetings of World Trade Organisation and other multilateral institutions. Both of them could not get attention of mainstream economic theory or players in global governance. The standard answers to placate them were (a) theory of comparative advantage which highlights gains of international trade for every participating country, (b) statistical correlations between growth and openness, (c) convergence and catch up hypothesis of economic growth and (d) argument of enlarged pie to be distributed later. I do not want to opine here as to who was right and who was wrong in the above debate, but has tried to make a point that the debate was not given due weightage in multilateral institutions, economic theory and developed economies until we started witnessing recent popular voices against globalization and inequalities in the US during campaigns of Donald Trump and Bernie Sanders.
Youth, minority races and long-term unemployed are at the forefront of this mass political mobilization. Its illustration can be found in a piece, published in March 2016 by think tank Brooking Institution which argued; Rust Belt geography of nation's anger has made Donald Trump and Bernie Sanders win primaries from New Hampshire to Michigan. The data presented and argument is as follows:
"According to these data, globalization, offshoring, and automation have since 1980 liquidated nearly 7 million manufacturing jobs in the US communities-more than one-third of the US manufacturing positions-as manufacturing employment plunged from 18.9 million jobs to 12.2 million. Moreover, as the chart depicts, while the trend is longstanding, it actually accelerated in the 2000s.
The aforementioned popular voices are not being echoed only in political campaigns and protests now - they are increasingly becoming a hot topic in mainstream economic circles. Well-known American Economist Lawrence Summer who was treasury secretary from 1999 to 2001 and Economic Adviser to President Obama from 2009 through 2010, published an op-ed in Washington Post in April 2016 titled "what's behind the revolt against global integration". He tried to clear myths about this outrage on one hand and also argued about weaknesses of current form of globalization that is being perceived to favor elite. In his view globalization will have to change its course to address these developments. I personally saw glimpse of unease and concerns about the popular rhetoric relating to anti-globalization or increase in minimum wages amongst mainstream economists during my recent interaction with two leading American Economics Professors who had chaired Council of Economic Advisors of President Obama and President Bush in the past.
Indeed Bernie Sander has attracted attention of more serious academicians and economists many of whom think his ideas of free college education, high taxes on elite and raising minimum wages are against the existing paradigm of research and wisdom in economics circles. Though, there is no concrete sign yet whether he will win democratic nomination but "Bernieconomics" has already left a footprint in mainstream economic and policy debates.
On the other side an interesting paradox can be noticed that some of the countries, eg, India and China who are gainers in this situation as compared to the US are now far more comfortable with the concept of globalization contrary to their traditional stance. For example, Indian economists used to argue and implement close door policies till 1990s but after the enormous gains of globalization reaped by them in last two decades owing to outsourcing and revolution of labour connecting technologies, they now advocate morality and efficiency dimensions of globalization and outsourcing from the US.
I don't have concrete analysis at the moment where the US and world economy will head in terms of globalization, but I am quite persuaded that outrage and popular voices in the US will certainly influence many of mainstream economic thoughts and global policies in near future. And I also do not consider that it will be a complete shift in economics and global politics analogous to paradigmatic change described by Thomas Kuhn, that after identification of anomaly and reasonable research and evidence new paradigm within a discipline takes over, but I think that new and parallel theories and polices will emerge and the economics discipline may further suffer disintegration as behavioural economics and economic sociology made their inroads. Explanation of similar phenomenon can be found in Martin Brofenbenner's paper of 1971 titled "The Structure of Scientific Revolutions in Economic Thought" that initially an antithesis may look emotional, childish and unstructured but makes its own way alongside existing paradigms and that how through the same process economics as a subject has evolved since David Humes and Adam Smith. And in recent past (2006) Irving Horowitz illustrated in his paper titled "Big Five and Little Five: Measuring Revolutions in Social Science" that existing disciplines and authorities in social sciences called "big five" either did not allow young researchers to find answers of their ambitious questions or they failed to address emerging issues of the society which gave birth to new social sciences called as "little five". Big five includes Economics, Sociology, Psychology, Political Science and Anthropology while little five includes communication, policy studies, criminology, urban affairs and environment studies.
As I have clarified at the start that the purpose of this piece is not to make arguments on either side of the debate but is to highlight the importance to study phenomenon of popular voices against globalization and inequalities in USA and corresponding academic, political and global response. It is still unclear that how these responses will unfold but a worth exploring conundrum.
(The writer is a doctoral student in Public Policy at University of Delaware, USA and has served as a governance specialist in the Ministry of Finance in the past)
Comments
Comments are closed.