What’s the problem with Globalization?

July 6, 2017

     By Duncan Green     

Globalization, remember that? When I first entered the development NGO scene in the late 90s it was all the rage. Lots of rage. The

Ah, those were the days

Ah, those were the days

anti-globalization movement roared from summit to summit. Academics traded books and papers that boosted or critiqued. The World Bank used voodoo modelling to show that really we’d all be better off if we just got rid of borders altogether. As the Doha Round got under way in 2001, the WTO became the epicentre of protest. Even as a besuited insider ‘NGO delegate’, I sniffed the tear gas in Seattle (v exciting) and spent far too much time memorizing the articles of the Agreement on Agriculture (less so).

Since then, we’ve had 9/11, paralysis at the WTO, and the 2008-? Global Financial Crisis. No-one talks much about globalization these days, so an invitation from some research pals for a Chatham House Rules brainstorm on revisiting the issue piqued my interest. Some thoughts and questions emerging from the conversation.

Do we even know what the problem is? The initial discussions were very much between economists (liberalization v industrial policy; one size fits all v national specificity). But the backlash against globalization has pulled in many other ways of looking at the world – anthropology and cultural studies on immigration and ‘othering’ of outsiders; politics on the rise of populism; sociology on the nature and impact of inequalities; environmentalists on planetary boundaries and GDP. Might be worthwhile asking globalization-watchers from 10 different academic disciplines to discuss the problem, and see what they come up with.

making_globalization___gatis_slukaIs this a Western issue? Even smart people in the US and Europe find it hard to stop domestic politics colouring how they interpret the world. As a Latin Americanist, I find it odd the way ‘we’ have just discovered populism – in many ways Donald Trump reminds me of a traditional Latin American caudillo (if Peron had had twitter….). So obviously, we need to ask around – how does globalization look from Beijing or Bamako?

What can we learn from history? Learning from history is difficult, not least because it is a combination of unidirectional change (new technologies, falling transport costs, rising literacy, urbanization) and cyclical change (the state v market pendulum, inclusivity v ‘othering’ the outsider). So it doesn’t really repeat itself. Nevetheless, we’ve seen big reversals and paradigm shifts before – peak globalization at the end of the 19th Century disintegrated into war and protectionism; the long Keynesian boom post World War 2 gave way to the harsher world of Friedman and neoliberalism. The traumas of 2008 and its aftermath don’t seem to be leading to a similar paradigm shift – or is it just too early to say?

Politics v Institutions: Politicians are more instinctive, and have the feedback loops in place so that they are rewarded if they capture the zeitgeist. Hence the rise of populism. Institutions seem altogether more sclerotic – they maintain paradigms rather than challenge them. Hardly surprising then that we are seeing a growing distance and tension between the two. Institutions typically try and constrain mould-breakers, bring them back to the existing paradigm, which is often a very good idea, but how would institutions need to change to adapt to the emerging problems of and changed political discourse on globalization?

This is not about post-globalization: We are not in a Newton v Einstein paradigm shift here. Because of the unidirectional elements of change, some aspects of globalization are likely to endure – so maybe those critical of the current manifestations of globalization should identify the best candidates for potential positive outcomes and focus on them until the dust settles, rather than keep pushing against the tide in search of that elusive new paradigm. Migration for example, why not focus on exploring how to make remittances work better for humanitarian response; social investment; conflict resolution?

Linear v Systems: In retrospect, the early 00s debates were based on a big assumption – that someone was in charge. Change policyglobalization_bad at the WTO and boom – problem solved. One of the striking features of the last 20 years is the growing complexity of the institutions and patterns of globalization – multiple, overlapping institutions, regional powers etc etc. What would a shift to systems thinking, along the lines of Andy Haldane on complexity and the financial sector, bring to the party? One consequence might be a shift from IIRTW (If I Ruled the World) to positive deviance – identify those sectors, institutions etc that have survived and flourished through the upheavals of the last 50 years, because they are likely to be constituent elements of whatever emerges from the current mess.

All a bit meta, I know, but it was that kind of conversation. Thoughts?