How many times a day do you hear about the benignity, the benefits and the incessant need to implement globalization?
If you are immersed in mainstream media propaganda, chances are you hear about the goodness of globalization and its inevitability. You even hear about the threats the world faces if globalization is not fully implemented.
As I will explain, globalization is not only a bad idea, but it actually threatens peace and stability because of the negative effects it has, especially in poor and developing nations.
As mistakenly argued by Adi Ignatius on Harvard Business Review, globalization is not essentially or absolutely reduced to “the free movement of trade, capital, people, and information”. That is too much of a simplistic assessment. There is nothing free about how globalization enforces the movement of people, products and services.
At its very core, globalization is the accelerated takeover of governments by multinational corporations.
In a globalized world, as we are currently experiencing it, multinational corporations become more powerful, while governments become more irrelevant; even truly freely elected governments.
In any nation, if institutions and values are more important than policy or discussions about policy, citizens have the duty and the right to shake government’s monolithic institutions whose work threaten that nation’s values.
Voters can reform those institutions and oust people who encourage or tolerate corruption, for example.
If government institutions are taken over by people who do not represent a nation’s values, people must choose new leaders.
However, with globalization in place, elections don’t matter anymore, because corporations tell politicians what to do, as supposed to the other way around.
Voters no longer have a voice and their vote is irrelevant. That is where we are today. Banks tell governments what monetary policies they must adopt and food giants tell governments what environmental policies they can enact.
Unfortunately, globalization doesn’t only bring bad news in the political realm. As stated before, a globalized world threatens peace and stability.
As you may suspect, corporations exist to make money and their owners will do whatever it takes to grow, expand, takeover and absorb anything they have to in order to grow and be more profitable.
This is not a conspiracy of any kind, it is simply the nature of doing business in a globalized world, where companies control it all.
Globalization is nothing else than the uncontrolled growth of corporate entities which take advantage of poverty conditions in poor and developing nations to use an abundant labor supply, at extremely low prices, to manufacture excessive amounts of products.
The cited uncontrolled growth was implemented via so-called free trade agreements, such as NAFTA, CAFTA and more recently the TPP and the TTIP. The true impact of trade agreements as established today can be seen below.
An important point about trade deficits is that they are commonly understood as imbalances between two governments; China and the US, for example. But in reality, those deficits exist between a country and one or more corporations.
The problem for corporations is that there are legal frameworks that limit their thirst for expansion, so, naturally, they move to different regions of the world where they can pay lower wages and deal with less effective regulations as they promise to bring employment opportunities for people with no skills, a group that makes up most of the population.
In many cases, corporations occupy the social, political, economic and financial vacuums left by governments due to their incapacity to fill them and this really comes with a very high price.
As strange as it may seem, we are not in the early stages but in the late stages of globalization.
As stated by a United Nations report, industrial automation alone costs poor nations anywhere between 47 percent and 77 percent of all jobs.
Cheap labor attracts multinationals, which offer low-wage jobs to unskilled workers. This is why illegal immigration is such a key aspect to be maintained for corporations. But there comes to a point where technology allows companies to produce the same amount of goods, or even more products via automation and AI-assisted manufacturing than with human labor.
This is the true tipping point of global stability and peace, because the questions to be asked is, what happens with billions of low-skilled workers once their labor is no longer needed?
Look at what happened to manufacturing jobs in the United States since it entered trade agreements:
What happens in China, India and Latin America once multinationals automate most, if not all their production?
What will happen to cities, once factories use robots, not humans, to produce cars, computers or food products?
In developed nations, governments do have the means to invest in infrastructure to build roads, bridges and parks, governments in poor and developing nations are not prepared to offer work to those billions of people.
So, how will these people earn a living? Can you hear the clock ticking?
In his book, US vs THEM: The failure of Globalism, Ian Bremmer explains that the global introduction of industrial automation will significantly reduce low-wage paying jobs in poor countries. As a result, poor people in those regions of the world will never move up the ladder to become middle-class folks.
“If they never join the active workforce, they will never have access to the education and training needed to earn twenty-first-century jobs, and they know their children will fare no better. Those able to keep their jobs may discover they must work for less pay and fewer (if any) benefits. If automation reduces wages in developing countries, it may become impossible for workers to gain the education needed to succeed in a world where advanced AI generates a much bigger share of the economic growth. Lower growth means less government revenue—and, therefore, less money to spend for education and services, for infrastructure, and for all the other things that middle classes expect from government. The virtuous circle becomes a vicious circle.”
If current production and employment conditions continue to trend the way they are, the jobs of the future will be unattainable for billions of people. Not even renowned educational powerhouses in developing countries are able to keep up with the fast-paced advance in technological development, so it’s hard to imagine what will happen in poor and developing nations.
What will labor and development look like in the near future? Bremmer explains:
“There are many reasons why the tech revolution will hit the emerging world much harder than it will hit Europe and the United States. In developed countries, children are more likely to grow up with digital technologies as toys and then to encounter them in school. Governments in these countries have money to invest in educational systems that prepare workers, both blue and white collar, for change. Their universities have much greater access to state-of-the-art technologies. Their companies produce the innovations that drive tech change in the first place. This creates a dynamic in which high-wage countries are more likely than low-wage ones to dominate the skill-intensive industries that will generate twenty-first-century growth, leaving behind large numbers of those billion-plus people who only recently emerged from age-old deprivation.”
Meanwhile, in poor and developing nations, the so-called safety net will cease to exist and people will not have the welfare state to save them. A government’s inability to provide free food and housing will, in the eyes of people, appear to be less legitimate. Examples of that scenario today are Venezuela in South America and Mexico in North America.
If a government cannot provide employment, free food or free housing, to its own people in poor and developing countries, how will they deal with mass immigration to cities?
Will people be able to understand that their present and future will depend on them being self-sufficient?
Luckily, globalism and globalization seem to have taken a fist on their jaw, with Donald Trump’s arrival to power in the US, Brexit in the UK and the appearance of new nationalist movements that seek to protect borders and sovereignty.
No, nationalism is not a problem. At the current stage, nationalism might just be a treatment for the threat to peace and stability posed by globalization.