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The steam has gone out of globalisation (economist.com)
43 points by prostoalex 28 days ago | hide | past | web | favorite | 68 comments

Globalization in the manner it has happened has lately struck me as akin to drinking from a firehose. While it's led to an increased standard of living (in the form of wages in the third world and lowered prices in the first), the speed at which it happened caused displacement far faster than the cultures could adapt.

If your industry disappears over 30 years, it's easy enough to stop hiring new people and draw down as the old retire. If it dies in five years, the dislocation is immense and it becomes nearly impossible to cope. The same problem of rapid change plays itself out in the developing world in different forms; rapid urbanization, pollution, dislocation from traditional ways of life.

If, as the article suggests, globalization has indeed slowed, perhaps the breathing space that slowdown provides will in the long run be a good thing. Deal with the problems we've created before doubling down on the instigating issue.

I have often thought that globalization has often been a means of sending 1st World volumes of manufacturing into places with 3rd World environmental, health, and safety laws. It took us time to build up our EHS standards to their current level, and our volume of manufacturing took time to build up also. If all demand were satisfied in countries with equivalent levels of EHS to the target market, the amount of pollution, etc. would plummet quite a bit just from that alone.

Good. Globalization was always about enriching the people at the top, using the excuse of benefiting the poorest.

But that thin veneer no longer hides the truth: globalization destroys both developing economies and the middle class of developed economies.

That seems like an oversimplified and overly polarized view. What about reductions in global shipping costs and opportunity for smaller businesses to serve a much larger market? Both of those provide benefits for those in the middle and bottom. In the last few decades, many developing countries have grown and benefited from globalization.

Globalization is a passive and inevitable process resulting from the constant pressure on businesses to grow and serve more and more people. Ascribing a moral charge to the whole idea of globalization obscures what it actually is and how it came about.

> What about reductions in global shipping costs and opportunity for smaller businesses to serve a much larger market?

These smaller businesses are the „top 1%“. And the reductions in shipping costs have had a huge negative impact on the environment (i.e. all of us) and actual small local producers.

In these developing countries you mention, it‘s also the „1%“ who benefited. The rest are working in cobalt mines etc. ...

Which countries are you talking about, and how has their median income changed over the past two decades?


During globalization we've had the fastest and greatest reduction of poverty on earth. Seems like a benefit to the poorest to me.

Funny, about 90% of those in poverty where in China. So basically globalisation allowed the world to outsource their labor to Chinese slave labor and raise them out of poverty to the biggest economy in the world in the space of a few decades. And now we’re all going to take a back seat to a hyper-ambitious, psychotic, totalitarian regime with a hard-on for world domination. Not exactly inspiring.

>hard-on for world domination.

looking at number of chinese military bases outside of China, or number of actual wars China participated in last 20 years, you can probably say that China's hard-on for world domination is pretty modest, as compared to... other countries with such hard-on.

Before they where slaving in rice fields and starving. Factory labor actually gave them a lot of freedom and self determination - even with all that suicide going on, but the point is that its far more nuanced then you make it out to be.

Edit: this article gives a fairly nuanced perspective on this topic, and its even more against my comment and for your comment.


But what share of the aggregate benefit? How is the growing gap between productivity and wages explained? It's still a race to the bottom, it's just that the bottom has risen a bit.

To me it matters very little if that same industrialisation and growth in consumption dooms us to a future of dying biospheres and growing atarvation, conflict, displacement, etc.

> During globalization we've had the fastest and greatest reduction of poverty on earth.


I've seen this claimed but I've never seen it substantiated.

https://www.politifact.com/global-news/statements/2016/mar/2... . You can debate how to define "poverty", and I'd certainly agree that somebody making $1.91/day isn't terribly well off, but real income has been consistently rising especially in the last 30 years.

Except a number of researchers and academics dispute that fact. Many say that it's a PR campaign for the World Bank and that it doesn't tell the whole story. If you raise the poverty line just a little higher to $5 then abject poverty has been increasing.



Your own link says that even that has fallen from 71.8% in 1990 to 58.1% in 2013.

Huge numbers moved out of grinding poverty in China and India. Its not even debatable.

True. I'm very anti-capitalist but no modern anti-capitalist disagrees that capitalism has (and must, to work) given people what Marx called double freedom.

maybe double freedom is better then starving of famine in the rice fields working 16 hour days?

I never said it wasn't. But like all things there are multiple aspects, not merely 'pros' and 'cons'.

Why do you remain anti-capitalist if you understand that?

Because I view capitalism (or, strictly speaking, capital) as authoritarian (mandating human energy be expended to its ends, working in tandem with welfare states towards administered living), exploitative (the labour produced by wage labourers in aggregate is less than the aggregate profit created due to their labour) and allowing only an ever-shrinking space for genuine human expression (it degrades art by forcing it to be marketable and commodified).

I'm not alone in this; even pro-capitalists agree that a relationship can be exploitative even if both parties benefit in some way - they just disagree that capitalism is the cause of such a relationship which we can see the world over.

I think the argument for capitalism improving peoples' lives by measurable degree is a valid one, but it is only as valid as the argument that feudalism (for instance) improved the lives of those without any sustenance or access to land at all. I think we have the capability to do better than pursuit of profit.

But how specifically do you think we can do better? Can it be done without a different kind of human being that does not pursuit his own self-interest?

It doesn't take much more than a google search to find substantiation for the claim.


i have a difficult time believing you're engaging in good faith when something like this is so easily verifiable




The rate of extreme poverty is falling fast. Proving that it was globalization is of course non-trivial.

But some businesses created millions of jobs in China and many other places.. some of these were local, some of them not so local.


Ah yes, I sure love lighting my country on fire so that village people can move from dirt huts to cement huts.

The article disagrees with your assertion:

Some 1.2bn people have been lifted out of extreme poverty since 1990

Do you have evidence that globalisation and inequality are linked? The global poor are better off, as well as the top x%. The losers seem to be the developed world's middle/lower class.

If you look at recent history, the rich have tended to do well during relatively quiet times but less so during turbulent times (like wars), so I'm not sure its a good idea to hope for a situation where the rich don't do well.

Which developing economies are being destroyed?

I don’t think so. I think automation and competition destroys it. You’re just competing with producers around the whole world + the shipping costs. The internet shows this - where “shipping costs” are nearly zero.

Are you making reference to shipping costs from China?

If so those prices were set before china developed, and as they stand at the moment are a subsidy from developed countries to China. These artificially low prices don't apply to industrial quantities of good though.


And yet globalization has led to the biggest decline in absolute poverty in history.

Oxfam just claimed (wrongly, but almost correct) that the bottom 50% got poorer again.


Technology and medicine brought many benefits to the world. Globalization? I‘m not so sure.

sparkie 28 days ago [flagged]

Capitalism has, not globalization.

There are still places trying socialism, and learning it doesn't raise people out of poverty, but creates more of it.

Please keep generic ideological talking points away from HN. They're predictable, therefore tedious, therefore off topic here.


No nation is 100% capitalist.

Even in the US the postal service is state owned. There are all sorts of regs around phone networks and health insurance that aren't capitalist in nature.

There's a wide spectrum in between the 2 extremes. You're right pure socialism doesn't work, neither does pure capitalism. Most of Europe exists quite happily further along the spectrum towards socialism, than for example the US.

Many of those kinds of monopolies are not natural but enforced by violence (or threat of). In many of those cases (if not all), a free-market would produce cheaper, better and faster services. Being government owned or government granted monopolies makes them inefficient and mostly unaccountable to anybody, because they don't have to operate like a regular company which would otherwise provide services - that is, if they don't live up to expectations they get replaced by the competition.

Often government monopolies are the worst elements of socialism and crony capitalism combined. They enrich an oligarchy of elites who in turn, bribe politicians to put more business in their direction.

"Many of those kinds of monopolies are not natural but enforced by violence" example?

It's not an either or proposition?

It's like mixing an elixir with red wine. You drink it and it cures you, and you then claim red wine has cured you, rather than the elixir.


Vacuous agitation, especially ideological or nationalistic, is not welcome on Hacker News. Please read https://news.ycombinator.com/newsguidelines.html and post either much higher-quality comments or no comments.

It's particularly against the site guidelines to insinuate astroturfing or shillage without evidence. "Lots of Chinese apparatchiks on here" is as absurd as it as lame, and if you post like that again we will ban you.

> Lots of Chinese apparatchiks on here.

It's possible for people to disagree with you without being employed by the Chinese government.

If it is Communism, then presumably it started in the 1930s, got worse post war, then got better at the end of the 1980s?

I'm not sure how the 'problem' manifests, but it doesn't seem to line up with globalisation.

Which places are those? What definition of socialism are you using?

I really appreciate that your current account has become far more civil in its postings to HN, but as far as I can tell it's still a single-purpose account that is interested only in discussing Marxist ideology (broadly construed). That's still not a legitimate use of Hacker News. Both the single-purpose part and the ideology part are too predictable to fit comfortably with intellectual curiosity, the main value of this site.

I understand the concern, I'll post less about that from now on. I mean it!

I always find your comments interesting :(

Venezuela, Cuba, Mauritania, Laos, North Korea, to name a few.

China is communist in name only. It's a capitalist economy which has enabled them to grow economically. Similarly with Vietnam, they're still recovering from the effects of communism, but it hasn't gone entirely.

Obviously, there is a spectrum, because some socialist policies exist everywhere. The point where socialism becomes anti-capitalism is where things start turn sour quite quickly.

True, but at least, it still increase the global poor’s money. Which I think makes it worth it. See China.


Substanceless nasty comments are way below the quality bar for HN. We've banned this account.

Why so selfish? We are one species.

Because benefits to people far away that you never have and never will directly observe seem abstract compared to the needy at home, which higher economic classes already ignore plenty.

We are individuals, not a blob of goo. Self preservation and acquisition of personal wealth are some of the fundamental drivers that have ultimately benefited our species.

Considering us as individuals is to an extent an ideological way to view the world. On the contrary, what you said can be said about cooperation and sharing too. See Kropotkin's Mutual Aid.

Sure, but the borders of a nation seem more arbitrary than a species as a grouping.

If the borders of nations seem arbitrary to you then take a history book and they'll be explained accurately.

Huh, I thought it was well-known that many borders were drawn arbitrarily.

India / Pakistan is one example. Lots of middle Africa. Basically anywhere where colonialism played a major role and there wasn't an ocean or giant mountain range to make it more obvious exactly where to 'draw the line' (usually fairly literally).

Or, just maybe, there is an optimum amount of globalization, somewhere in between total isolationism and complete outsourcing, and the world overshot, so we're backing it up, just a bit.

Sounds reasonable.

What's the difference between global trade and domestic trade though?

Seems to me that differing standards are the problem, rather than globalisation per se?

Certainly it seems plausible that trade between the U.S.A. and Mexico might be problematic in a way that trade between the U.S.A. and Canada is not. But there is another issue with international trade.

What restrains the urge of the top 100 corporate elite to pay their labor as little as possible, and get laws (e.g. anti-union, no minimum wage, etc.) passed accordingly, is that each of those 100 wants the other 99 to pay THEIR employees well, because the employees of the other 99 are his customers. He doesn't want to pay his own employees well, but he will collude with the other 98 to make sure each of the others pays their employees well enough they can buy his car/suit/food/appliance/etc.

But what if he can have the employees in another country, pay them pennies, and have his customers in this country? Or, if he's on the poor country side of things, what if he can just find rich customers in another country? Now he has no reason to worry about insuring that his peers' employees are paid well. They're no longer his customers.

But wait, how will there still be wealthy customers in his country? There won't. But, no problem, we can loan them the money to buy my stuff.

It works until it doesn't. But if your employees and your customers are drawn from the same pool, then your exploitative greed is checked by all your greedy peers' exploitative greed. This is why Henry Ford and Andrew Carnegie were both in favor of higher wages for factory workers; it wasn't because they were nice guys. But, more recently, the manufacturing happens elsewhere. This removes one of the only checks on the power of wealthy elites to apply the screws to their employees (legally or otherwise).

Elsewhere on HN: https://www.reuters.com/article/us-davos-meeting-solar-gcl-i...

Chinese ripped off U.S.-based solar, went crazy, drove margins to 0%, overproduced, dumped in U.S., reduced U.S. profit incentive in solar development, and are now going to restrict supply to try to get prices up.

Meantime, we've had less serious R&D investment in solar than we would have had otherwise.

So, no, globalization doesn't always work especially when one of the other majors is a state-directed Communist country.

Sounds like 90% a political issue and 10% causes by globalization. Slightly adjust a tariff and the above situation is impossible but globalization can still occur.

I’d be curious to find if there are international dumping laws or something similar. I’m on mobile, but I know the us has them.

Heh, Amazon

What do you mean?

Well, to be honest, I only could see part of the story and then it asked for me to subscribe. But anyway, I don't have anything else to add.

Please don't post unsubstantive comments here.

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