A future imperfect: why globalisation went wrong | Adrian Wooldridge | TEDxLondonBusinessSchoolMay 01, 2020
In his wonderful book The Economic Consequences of Peace, John Maynard Keynes sums up the picture of a civilized, middle-class Londoner just before the First World War. order raw materials from all over the world you are absolutely sure that those raw materials will be arriving at your doorstep in the next few days you are using this novelty device to make investments in stocks and shares in companies operating all over the world you are absolutely sure that you will make money of those investments and Cain says that this Londoner is certain that the world will continue to become more cosmopolitan, more integrated, more global and is utterly blind to the forces of nationalism, tribalism and protectionism that are about to transform that world into the global elite in the last t
wenty years has been like Keynes's Londoner we have been lying in our collective bed drinking our collective tea reading our collective google google and we've been making our investments we've been pushing our brand smartphones we've been waiting for our goods to arrive from Amazon at our doorstep the next day and collectively we've been absolutely blind to the forces of tribalism nationalism and xenophobia that are currently transforming our world now londoners of keynes the world was transformed by world war 1 world war 1 divided the world into murderous warring tribes after world war 1 you have an economic crisis the economic crisis led to protectionism protectionism led to depression after the war, the rise of Hitler emerged, which led inexorably to World War II. global integration from 1945 until the financial crisis the world became more integrated you had a more ambitious more arrogant notion of globalization constantly pushing the world to come together but i think what happened with the financial crisis was that this period of globalization started to come to its end. it is an ideological project driven by policy makers who constantly want to lower borders cheered by ideologues and idealistic intellectuals who say that globalization will produce a more integrated more liberal more peaceful world that globalization is beginning to dissolve before our eyes the great age of globalization depended on the United States engaged with the world after World War II, the United States took the lead in promoting free trade, in promoting NATO, in promoting a global security architecture, but after World War I, the United States did none of that. withdrawn from the world and that's why you have depression that's why you have we have protectionism that's why you have the rise of these monsters all over the world I think we're going back to the attitude of the United States after the first world war in instead of after the second world war the second globalization depended on the u the The European Union is moving forward by absorbing more members That process has reached its limits and is starting with Brexit to reverse the European Union has essentially now reached its limits essentially paralyzed what
wrongI think what went
wrongessentially is that the globalizers overpromised and underdelivered promised that globalization would produce a world of obvious benefits for all a more prosperous and more stable world a more pleasant world well they said of course it there will be disruption of course there will be difficulties of course people will have to change and adapt to that world but overwhelmingly you see improvements in your life this clearly happened in the emerging world i was in june dow not that long ago a city i hardly ever heard of everyone seemed prosperous there were new cars the skyscrapers people had jobs, there was a great sense of optimism, everyone was looking to the
future, that's a wonderful thing, but if you leave that world, the emerging world, and look at the rich world that you see, you see that the standard of living in America has stagnated the average American has seen their standard of living stagnate for the last 20 years I recently went to Wolverhampton the exact opposite of Jing Dao a world where people have seen their lives shattered by industrialization, a world where people have no hope for the
futureand what worries me is that in this period of hyperglobalization productivity growth has been much slower than it was from 1945 to around 1970 when there was a much more controlled version of globalization so we were promised growth acceleration and what we've seen in the rich world at least productivity growth started ing to stagnate major stagnation the globalized has promised it would have some kind of platonic Guardian class they said well of course we will have turmoil of course we will have capital movements of course there will be hot money running all over the world but we understand the science of economics we can control these things we will give you the Great Restraint it will end the boom and bust cycle we can control globalization it will unleash this force it will make you richer and we can control it well that argument was swept away by the global financial crisis which was testament to extremely poor financial management so things are not going Well, the globalizers also promised that all good things would tend to go together, I don't know.
It would only move global markets forward, it would move democracy forward, it would. Not just getting global markets and democracy moving forward, but also getting liberal values moving forward would all go hand in hand. There was a lot of talk about how democracies never go to war with each other. Then there was even talk of countries where the McDonnells will never go to war with each other. That's how silly things got. This has not happened. We have not had this triumph of global liberal values. We have had an alternative model of globalization. what is authoritarian globalization with people in putin people bite people a lot like turkish countries like turkey which are based on the idea of illiberal authoritarian globalization illiberal authoritarian global global capitalism as an alternative to the liberal west one of the great debates in the 1990s was between Francis Fukuyama and his end of history argument and Samuel Huntington who talked about the clash of civilizations, well what we've seen is that Huntington won that argument in absolutely dramatic fashion. even worse and the same people, the same people who are making these arrogant arguments, have actually engaged in a massive process of self-negotiation they have done exceptionally well in this process of globalization at a time when we have seen economic stagnation the global elite it has become richer and richer and has become like bandits we have seen politicians on the revolving door going from running Latorre regulated bodies that operate in Parliament to working for these global companies we have seen global companies big wonderful global companies that claim to be doing good in the world hiding tax money the tax system engages in the most extraordinary process of lobbying rigging the system hiding their profits we have seen a global elite elite preaching the virtues of globalization but acting like some kind of sidekick crony capitalists globalists and I think something else has happened at this time globalization offers a very difficult world. it entrenches people's lives it challenges their cultures but what does it offer in return i haven't seen much depth how amazing a The thing about globalization is how shallow it has often been how shallow its offer has been so if you look back to the great era of liberalism in the 19th century, which had an extraordinary flowering of culture, you had Balzac, you had the bait, oh, you had great artists, what? we have had during the era of hyperglobalization airport lounge management textbooks it has been an extremely disappointing era from that perspective but mostly what globalization or hyperglobalization does is unleash its opposite it has unleashed a very ugly form of nationalism so confronted with broken promises confronted with stagnant economies confronted with cronies --en-- global elites looking out for each other the masses people are starting to turn to the worst sellers of snake oil they are turning to people who say the best alternative to hyperglobalization is ethnic nationalism the best alternative to doing too much to push the freedom of movement of people and ideas is protectionism and the economy run from above so i think the big challenge for liberals in the next few years is to save globalization reforming it.
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This will involve much more humility on the part of liberals. they thought they were fundamental and I think that the free movement of people could well be part of that. I think that the European Union's insistence that the free movement of people is absolutely indisputable may well be going too far, it will imply a willingness to recognize that the nationalism has a positive side and a dark side we need to rescue the good side of nationalism to prevent the bad side of nationalism from triumphing it will imply a kind of humility on the part of the people we have seen in the last L on the part of the globalists we have seen in the era of globalism triumphant a kind of bourgeois triumphalism the kind of notion that everyone who disagrees with us is right is wrong Anyone who disagrees with our values on free trade, free movement across the borders, gender fluidity and the rest, you must be a bigoted, foolish nationalist, and we must demonize them and get them out of the picture. script, and this is coming from people who have mismanaged this process and have gotten rich in the process of globalization and I think above all else we need to have a war against self-dealing against global cronyism.
We need to stop this door from turning. We need to prevent these tax havens from being created. to keep companies from paying taxes, so the price of failure, the price of failure of this process, will be an ugly world of nationalism and xenophobia, and the people who will be responsible for creating this ugly world will be just as much overreaching globalists as they are . they are nationalists who hit the tub thanks
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