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Stiglitz on the globalisation revolt

Written By: - Date published: 7:54 am, August 8th, 2016 - 69 comments
Categories: activism, capitalism, class war, economy, Globalisation, trade - Tags: , , ,

This recent piece by economist Joseph Stiglitz is an important and interesting read:

Globalization and its New Discontents

Fifteen years ago, I wrote a little book, entitled Globalization and its Discontents, describing growing opposition in the developing world to globalizing reforms. It seemed a mystery: people in developing countries had been told that globalization would increase overall wellbeing. So why had so many people become so hostile to it?

Now, globalization’s opponents in the emerging markets and developing countries have been joined by tens of millions in the advanced countries. Opinion polls, including a careful study by Stanley Greenberg and his associates for the Roosevelt Institute, show that trade is among the major sources of discontent for a large share of Americans. Similar views are apparent in Europe.  How can something that our political leaders – and many an economist – said would make everyone better off be so reviled?

Large segments of the population in advanced countries have not been doing well: in the US, the bottom 90% has endured income stagnation for a third of a century. Median income for full-time male workers is actually lower in real (inflation-adjusted) terms than it was 42 years ago. At the bottom, real wages are comparable to their level 60 years ago.

Branko Milanovic’s new book Global Inequality: A New Approach for the Age of Globalization provides some vital insights, looking at the big winners and losers in terms of income over the two decades from 1988 to 2008. Among the big winners were the global 1%, the world’s plutocrats, but also the middle class in newly emerging economies. Among the big losers – those who gained little or nothing – were those at the bottom and the middle and working classes in the advanced countries. Globalization is not the only reason, but it is one of the reasons.

The failure of globalization to deliver on the promises of mainstream politicians has surely undermined trust and confidence in the “establishment.” And governments’ offers of generous bailouts for the banks that had brought on the 2008 financial crisis, while leaving ordinary citizens largely to fend for themselves, reinforced the view that this failure was not merely a matter of economic misjudgments.

In the US, Congressional Republicans even opposed assistance to those who were directly hurt by globalization. More generally, neoliberals, apparently worried about adverse incentive effects, have opposed welfare measures that would have protected the losers.

But they can’t have it both ways: if globalization is to benefit most members of society, strong social-protection measures must be in place. The Scandinavians figured this out long ago; it was part of the social contract that maintained an open society – open to globalization and changes in technology. Neoliberals elsewhere have not – and now, in elections in the US and Europe, they are having their comeuppance.

Globalization is, of course, only one part of what is going on; technological innovation is another part. But all of this openness and disruption were supposed to make us richer, and the advanced countries could have introduced policies to ensure that the gains were widely shared.

Instead, they pushed for policies that restructured markets in ways that increased inequality and undermined overall economic performance; growth actually slowed as the rules of the game were rewritten to advance the interests of banks and corporations – the rich and powerful – at the expense of everyone else. Workers’ bargaining power was weakened; in the US, at least, competition laws didn’t keep up with the times; and existing laws were inadequately enforced. Financialization continued apace and corporate governance worsened.

The main message of Globalization and its Discontents was that the problem was not globalization, but how the process was being managed. Unfortunately, the management didn’t change. Fifteen years later, the new discontents have brought that message home to the advanced economies.

Check out the full piece on Project Syndicate.

69 comments on “Stiglitz on the globalisation revolt”

  1. Pat 1

    and i see Stieglitz has resigned from the Panama Papers Commission…..distrust all round it would appear.

    https://www.theguardian.com/world/2016/aug/06/two-resign-from-panama-papers-commission-over-publicity-of-report

  2. Garibaldi 2

    “the new discontents have brought that message home to the advanced economies”.Trouble is it hasn’t brought the message home to our economy, and with the current situation with our govt/media/sheeple it won’t.

  3. Ad 3

    Beautifully expressed, so long as it confines itself to economic matters.

    The discontent is certainly about failure of public and private profit distribution, but only in parts.

    • adam 3.1

      Stiglitz, is a classical liberal, it shows in his work, and I find he is apologetic towards where liberalism has gone, but he has trust in the overall project. Hence why I’m personally not a fan.

      He works have two themes which annoy me, he ignores the concerns from indigenous communities, and a stark unawareness of U.S cultural hegemony.

      • Draco T Bastard 3.1.1

        Yeah, can’t say that I’m a fan of his either but he does make some good, hard hitting critiques of the status quo every now and then. He just then goes on to make the wrong recommendations about how to fix it.

      • Ad 3.1.2

        I don’t mind classical liberals. Bernie was a classical liberal: there was nothing that taxed income redistribution couldn’t solve.

        And I have a lot of respect for Mr Stiglitz’ work. His comments are another attempt to take account of the rise of Brexit, Trump, and other isolationist efforts.

        But Stiglitz can’t reasonably make global trade liberalisation the root cause of global discontent.

        There’s those troublesome perpetual wars in the middle east, vastly amplified by US stupidity for three decades.

        There’s that thing about climate change, famine, and stuff.

        There’s endemic corruption in really poor countries, together with accelerating civil wars all over the joint.

        There’s the failure of alternative state models of redistribution after the fall of the Soviet Bloc.

        There’s that thing about the rise of militant Islam and the direct threat against liberal ideals that have been around for a while.

        He’s a major economist, and I like him. But being economically determinist about global discontent just isn’t helpful.

  4. b waghorn 4

    In a nutshell would it it be fair to say globalisation will only work if we find a way to rein in the greedy self serving pigs at the trough.?

    • Peter Ch Ch 4.1

      Globalisation IS working. See my post below. Why do you rich westerners only ever see the world from your very narrow and selfish perspective? Humans are adaptable. Its time for the west to start adapting to the changing world rather than jealousy guarding and trying to hold on to the past.

      Anyway, it appears that most on this site are supporters of a Corbyn like view of the world. Where are your socialist views on the greater good and no borders now? Or does your socialist views only extend to those with a white skin?

      • b waghorn 4.1.1

        I’m pro globalisation but lifting some out of poverty while others sink into poverty has to stop,
        Or are the working poor and the unemployed just collateral damage?

      • Paul 4.1.2

        What polices make for a Corbyn like view of the world?
        Please be specific.
        General smears are little use.

        • Peter Ch Ch 4.1.2.1

          Paul. Specifically i was referring to his positive views on improving the welfare of the worlds poor and oppressed, rather than the view of Standardista socialists whose socialist views are restricted to those in nz.

          If the keyboard socialists on here truly beleive in socialism, theybwould at the very leastblearn enough to be able to see how globalisation has lifted the poor of china tona level almost comparable with nz.

          • KJT 4.1.2.1.1

            Imagine how much better off the Chinese would have been if they had been allowed to develop their country and industries behind tariff barriers, as the USA and UK did.
            When the USA had a high standard of living for everyone, less than 5% of their economy was overseas trade.

          • KJT 4.1.2.1.2

            That’s why they have nets below the windows in Foxconn sweatshops. To catch the weighty wallets of the workers.

      • One Anonymous Bloke 4.1.3

        In order for international labour organisations to affect a global economy, first they have to exist. There are nascent links between individual unions but nothing has yet evolved that can challenge global capital at a global level, apart from Social Democracy and the rule of law.

        Is it any wonder that workers’ interests are still constrained by borders?

        Xenophobia may well play a part in that. I expect limited resources play a bigger one.

      • KJT 4.1.4

        Tell that to a Mexican or African small farmer who has lost his livelihood, due to the dumping of the products of large scale US agribusiness in their countries.

        Not to mention those bombed by ‘Globalised” weapon sales or impoverished by “Globalised finance taking the profits out of their countries.

      • KJT 4.1.5

        Globalisation is working perfectly. Enabling the wealthy in countries like the USA to take resources, including labour, out of a country even faster, ultimately leaving them even poorer in future after a short lived boom.
        Eventually turning the whole world into a Midwestern rust belt.

        Greece is just the first.

  5. Peter Ch Ch 5

    This is really written from the perspective of the rich western countries, where globalisation has unquestionably had a negative effect. But taken globally, the ‘globalisation ‘ of the economy has had a very positive effect.

    As an example, in 30 years the 1.4 billion people of China have had an increase in living standards that were beyond their wildest imaginings only 30 years ago. And that globalisation has also led to other improvements, such as an increasing awareness of Chinas contribution to climate change, concepts of social responsibility and human rights.

    As 1 in 5 people on earth live in China, it is ridiculous to say that globalisation has had an overall negative result. And thats just China. Add in the rapidly rising living standards of India also due to globalisation and the notion of it being negative overall becomes ludicrous.

    But yes, in the rich west the process has often been managed badly. I guess the speed of the change has often meant paniced reaction rather than foresight being employed. But many in the rich west, including many on this site, simply fail to realise that the world has changed. The economic power has and will shift to india, Brazil and China.

    • Pat 5.1

      not entirely a western perspective….as in the west the benefits are not evenly shared in the developing world either…..it is a varied picture, even in China.

      “The international community has a role to play in promoting the adoption of appropriate policies to protect workers from the negative effects of globalization. Regarding labor market policies, it can assist in the design of one-time compensation packages and more permanent income support programs to mitigate the consequences of job loss. On the other hand, promoting “core” labor standards, higher minimum wages or bigger public sector employment may not do much to offset the impact of globalization. In the case of public sector employment it can lead to a poorer performance. Finally, there is no strong rationale for the international community to act through sanctions or conditionality. Trade sanctions, in particular, could indirectly penalize workers in developing countries. Modifying the incentives faced by producers and consumers in industrial countries may be a more promising approach. Because of its monitoring requirements, this approach requires a strong involvement of the civil society”

      http://info.worldbank.org/etools/docs/library/75867/dc2003/proceedings/pdfpaper/module1mr.pdf

      • Peter Ch Ch 5.1.1

        Inequality is inevitable. In the west or elsewhere. Whether under capitalism or communism or indeed under any ism.

        The key is equality of opportunity and a good and rising baseline for key issues such as health and education, social services and suchlike.

        • Pat 5.1.1.1

          I wonder whether many Indonesians think globalisation provides “equality of opportunity and a good and rising baseline for key issues such as health and education, social services and suchlike.”?

          https://www.theguardian.com/sustainable-business/2015/jun/11/palm-oil-industry-indonesia-corruption-communities-forests

          • Peter Ch Ch 5.1.1.1.1

            Its easy to look for exceptions, and highlight these. But OVERALL globalisation has been positive.

            India and China combined have around 35 to 40% of the global population. Globalisation has had huge positive effects in China and increasingly in India also.

            In many of these countries such as Indonesia, the problem is often not globalisation but rather the stifling effect of corrupt elites and theocratic megalomaniacs.

            Afterall, just look at the treatment of women in many islamic countries. Is this the result of globalisation? No. It is the pre-existing and vile social order. If anything, globalisation will hopefully weaken and destroy the worst excesses of this.

            • Colonial Viper 5.1.1.1.1.1

              Yes globalisation has been positive for the 0.1% who skimmed off the difference between paying a NZ worker $25/hr and paying a Chinese worker $3/hr.

              Stop apologising for the neoliberal globalist set of 0.1%’ers. It’s embarrassing.

              • Draco T Bastard

                +1

              • Peter Ch Ch

                China $3 per hour? Are you serious?

                The wages in China now, in purchasing terms, are not much less than NZ. Most Chinese now in the cities own their own apartments. Car ownership is rapidly increasing. Overseas travel is now the norm. You are living in a deluded past. The world has changed. Globalization has made most Chinese on a par with most Kiwis.

                Try visiting China sometime, away from the tourist areas. Try talking to some Chinese immigrants to NZ. You will be surprised. The only reason Chinese are so keen to live in NZ is for a better quality of life, absolutely not for a higher standard of living.

                • Colonial Viper

                  The wages in China now, in purchasing terms, are not much less than NZ.

                  Yes, that’s now. It’s why corporations are pulling out of China and going to Vietnam, Cambodia, Bangladesh and other places.

                  And the PPP terms you prefer are still way less than NZ wages in nominal dollar terms. The 0.1%’ers skim off the rest.

                  You’re still embarrassing yourself shilling for the interests of the 0.1%.

                  • Peter Ch Ch

                    As you admit in your comment, globalization has worked extremely well for China. As you yourself state, wages have risen to such an extent in China over the last 20 to 30 years that some corporations are relocating their manufacturing to low wages economies. Thank you for your agreement in these matters.

                    And of course these low wage economies will benefit as China has from globalisation, subject to the weakening of the corrupt elites and theocratic institutions that will do their best to hold on to their positions. But of course globalisation will weaken these too, just as slowly but surely globalisation is undermining the evil of China’s Community Party.

                    Nominal dollar terms? Do you actually understand this term? Have you lived, worked, or grew up in this country? Clearly you have done none of these things.

                    As a citizen in the rich west, where a life of relative ease has been handed to you on a plate from the day you were born, you lack the direct understanding of how lives have been immeasurably changed through open trade. Yes, many many problems still, but your attitude and lack of knowledge typifies why the west is struggling and other nations are taking your place.

                    • Macro

                      “globalization has worked extremely well for China.”
                      That’s why their 0.1%ers are now buying up half of Auckland..

                    • Peter Ch Ch

                      Macro. Not really. A big chunk of the 0.1% you are referring to would be the proceeds of corruprion flowing out of China as Mr Xi is increasingly seizing tge priceeda of corruptions. Same reason for canada and australia housing bubble

                    • Macro

                      So essentially Globalisation has not worked for China either – certainly not the 50% below the median nor the environment
                      or bees

                    • Peter Ch Ch

                      Macro. Well clearly there is 50% below the median. You do understand the meaning of median?

                      And as i have repeated many times, globalisation has absolutely worked for China. You can argue many things but not this point. It is indisputable.

                      And try actually asking ANY Chinese person if they support globalisation. I guarantee absolutely they will all say yes.

                      The world is a big place. It is important to see beyond the narrow confines of ones own country.

                    • Macro

                      Yes Peter I have a very strong understanding of the use of the median having worked in the Research Branches of the Dept of Statistics and the then Dairy Board, and taught Statistics at Tertiary level.
                      You apparently have no appreciation of the living conditions of the poorer sectors of the Chinese population. Try expanding your reading on these matters.

                      Here is something to begin with:

                      Right now, in Shanghai, China, a factory owned by the Taiwanese Pegatron Group is pushing out millions of units of the iPhone 6s for Apple. There, its young production workers toil six days a week in 12-hour shifts. Each day they are paid for 10 and half hours of work, not counting 15 minutes of unpaid meetings. The mandatory overtime shift runs from 5:30 pm until 8:00 pm. Most workers will not eat dinner before doing overtime because the 30-break given for a meal is not enough time.

                      Before overtime pay, workers making the iPhone earn only the local minimum wage of $318 per month, or about $1.85 per hour. This is not a living wage. Even if the factory did not mandate overtime as it does, workers would still depend on their 60-hour workweeks to get by.

                    • Colonial Viper

                      Peter ChCh carefully sidesteps the point that the 0.1% investment class has moved manufacturing to China in order to skim off $$$ using wage and regulatory arbitrage, impoverishing the western working and lower middle class in the process.

                      Peter ChCh is trying to weakly pretend that western corporations moved their manufacturing to China mainly for the good of Chinese peasants.

                    • Macro

                      Exactly CV and when China gets “too expensive” next stop on the list is Vietnam – then Africa – maybe Ethiopia.
                      There are far better ways to improve the living standards for people than sweatshops, and legalised slavery.

                • LXXI years too old

                  I was in China last (NZ) winter, for 2 and a half months, much of it living with Chinese families both in the Cities and in rural China. I first visited China about 30 years ago, and YES, that was a very different China from what we see today.

                  IMO you are talking a complete load of crap Peter Chch.

                  “The wages in China now, in purchasing terms, are not much less than NZ . . . . ”

                  Utter bullshit, if you take wages across the country as a whole including the HUGE numbers who still eke out a rather minimal existence on tiny rural farm-lots. A lot of rural workers only manage to get by because of generous rural subsidies from the government – you might call that “wages” but I certainly don’t.

                  “Most Chinese now in the cities own their own apartments. Car ownership is rapidly increasing. Overseas travel is now the norm . . . . .”

                  No. Not for most, but yes for some. CERTAINLY not the NORM by any generally accepted meaning of the word. The number of two-car families in China, for example, is miniscule compared with the number of two or more car families in this country.

                  ” . . . . You are living in a deluded past.”

                  I have my own ideas about exactly who is the deluded one here.

                  • RedLogix

                    In my experience you are exactly correct. PeterChCh is looking at the wealthiest 1% and mistaking their lifestyles for what most Chinese experience.

                    Of course there will always be inequality; it is the grotesque extremes of it that is what is proven to be socially corrosive. And that particular acid is very much eating away at the modern Chinese cultural fabric.

                    • Colonial Viper

                      the inequality and general malfaesence is heading directly back to pre-Communist 1910s 1920s China.

                  • Peter Ch Ch

                    Exactly. 2.5 months as a tourist so your knowledge is absolutely zero. My knowledge comes from birth in china until 11 years ago. I was born in rural shandong. Grew up in jinan. Each year i spend about 4 weeks there. So i do know what i am talking about. You, with the best will 8n the world, cannot

            • KJT 5.1.1.1.1.2

              You could just as easily say that it was “Communism” that raised living standards. in China, and you would be just as wrong.

        • UncookedSelachimorpha 5.1.1.2

          “Inequality is inevitable.” But the degree of inequality is hugely important and is not inevitable, and is a political/social choice.

          “The key is equality of opportunity” Study after study shows that pre-existing inequality of wealth and income is inextricably linked to opportunity. Plus right wingers who spout this sort of nonsense typically engage in policies and practices that result in anything but equality of opportunity.

          • Peter Ch Ch 5.1.1.2.1

            To clarify, i am no right winger. And you have quite rightly clarified my rather loose statement.

            But seriously, inequality outside the west is less about globalisation and mostly about entrenched political and religious elites. How to change that? Usa tried in Iraq by force and failed miserably. Healthy change evolves. It is not forced

            • Colonial Viper 5.1.1.2.1.1

              But seriously, inequality outside the west is less about globalisation and mostly about entrenched political and religious elites.

              LOL what an absurd, ignorant statement.

              How to change that? Usa tried in Iraq by firce and failed miserably. Healthy change evplves. It is not forced

              Who did the US try and get rid of in Iraq? Oh yes Saddam Hussein.

              Who was the major arms supplier, funder and political backer of Saddam Hussein for years and years? Oh yes, the US.

              Do try and connect the dots.

              • Peter Ch Ch

                As usual your belligerent and ignorance shows through.

                Try looking at the iraq army of 1990 or 2000. Do you see any usa equipment? No. It is entirely warsaw pact.

                I will no longer reply to your comments. You are an idiot whi spends his life trying to destroy.

                • Colonial Viper

                  Donald Rumsfeld meets Saddam Husseinn1983, discussing oil and weapons deals, and how to antagonise the Islamic Republic of Iran.

                  Details on how the US assisted Iraq in its war against Iran 1980-1988, and assisted Saddam Hussein with chemical and biological weapons. Involvement of Bush Snr detailed.

                  http://www.counterpunch.org/2004/06/17/how-reagan-armed-saddam-with-chemical-weapons/

                • joe90

                  No. It is entirely warsaw pact.

                  Because Ronnie Raygun’s mob made it so

                  CIA Director Casey personally spearheaded the effort to ensure that Iraq had sufficient military weapons, ammunition and vehicles to avoid losing the Iran-Iraq war. Pursuant to the secret NSDD, the United States actively supported the Iraqi war effort by supplying the Iraqis with billions of dollars of credits, by providing U.S. military intelligence and advice to the Iraqis, and by closely monitoring third country arms sales to Iraq to make sure that Iraq had the military weaponry required. The United States also provided strategic operational advice to the Iraqis to better use their assets in combat.

                  […]

                  I personally attended meetings in which CIA Director Casey or CIA Deputy Director Gates noted the need for Iraq to have certain weapons such as cluster bombs and anti-armor penetrators in order to stave off the Iranian attacks. When I joined the NSC staff in early 1982, CIA Director Casey was adamant that cluster bombs were a perfect “force multiplier” that would allow the Iraqis to defend against the “human waves” of Iranian attackers. I recorded those comments in the minutes of National Security Planning Group (“NSPG”) meetings in which Casey or Gates participated.

                  […]

                  One of the reasons that the United States refused to license or sell U.S. origin weapons to Iraq was that the supply of non-U.S. origin weapons to Iraq was sufficient to meet Iraq’s needs. Under CIA Director Casey and Deputy Director Gates, the CIA made sure that non-U.S. manufacturers manufactured and sold to Iraq the weapons needed by Iraq. In certain instances where a key component in a weapon was not readily available, the highest levels of the United States government decided to make the component available, directly or indirectly, to Iraq. I specifically recall that the provision of anti-armor penetrators to Iraq was a case in point. The United States made a policy decision to supply penetrators to Iraq.

                  http://www.webcitation.org/5flvP0UgC

            • UncookedSelachimorpha 5.1.1.2.1.2

              “But seriously, inequality outside the west is less about globalisation and mostly about entrenched political and religious elites.”

              I agree, I would add ‘entrenched wealth’ to that list. Overall I am a globalist, it can be a tool for good, but can also be misused by the powerful to grab wealth off others while avoiding costs or contributions.

            • KJT 5.1.1.2.1.3

              USA invaded Iraq to keep the petrodollar.

              Nothing to do with “removing entrenched elites”.

              Everything to do with Iraq’s trying to keep the profits from their oil in their own hands.

              Making the world safe for Exxon and Halliburton.

        • Draco T Bastard 5.1.1.3

          Inequality is inevitable.

          No it’s not. In fact, I’d go so far as to call that an outright lie.

          The key is equality of opportunity

          Wrong again. The key to improved living standards is cooperation and not competition.

    • UncookedSelachimorpha 5.2

      PCHCH – But you could have easily had the global benefits you describe, without the poorer half in the developed world doing so badly. International trade and development does not inherently require that the majority of the wealth in developed countries concentrates to the top few percent, which is what has happened, and which Corbyn and co are correctly pointing out is a massive problem.

      • Peter Ch Ch 5.2.1

        Agree it is a massive problem. But how to change is not so easy.

        But i was really just commenting on the effects of globalisation being beneficial, overall.

        And you say ‘the poorer half’ in the developed world, but that not true. Overwhelmingly in China, for example, most people have benefited to a huge degree. Even the poorest people in the most remote villages have access to broadband, for example. Even 20 years ago web access in China was to all purposes non existent.

        Globalisation is here to stay. And NZ better be ready, as the next wave is almost here. Alibaba is already making its effect frlt in nz. Once Taobao and TMall are opened to the west, globalisation will ratchet up another massive notch.

      • Pat 5.2.2

        exactly…there is no reason why education and health needs can’t be met without gifting a countries assets to the exploitation of international corporations.

        • Peter Ch Ch 5.2.2.1

          Yes i have often wondered why NZ has been so generous with its assets. But npt just assets. A big chunk of the world wants to come to countries like nz, yet the nz government practically gives away its single most valuable asset: citizenship, to any lying, cheating, poorly educated or poorly trained person who has enough money to buy false dicuments and history to navigate the immigration system.

          I think it would truly surprise most kiwis that there is an entirely separate economy and world within this county that barely touches the mainstream economy

          • Kevin 5.2.2.1.1

            “Yes i have often wondered why NZ has been so generous with its assets.”

            Your naiveté is quaint Peter, but seriously, how do you not understand this?

            Take a look at WHO the assets were sold to.

    • Paul 5.3

      Ask the people of Cambodia, Indonesia, Russia, Nigeria, Congo, Honduras, the Philippines and many others what they think of globalisation.

      Not the corrupt 0.01% at the top of each society.
      The people.

      For some reason, you’re acting as spokesperson for the world’s fat cats, which is shameful.

      • Peter Ch Ch 5.3.1

        The countries you mention all suffer frim decades or even centuries of stifling corruption and elites that run their countries as though it were their personal property. This has little to do with globalisation. It has everything to do with history.

        • KJT 5.3.1.1

          You fail to understand the driving forces behind rising living standards.

          It is not globalisation, but local investment.

          Globalisation and the consequent takover by conscienceless corporations and oligarchies has been a brake on the use of improved economic and technical systems to improve peoples lives.

          China has resisted Globalisation by fixing their currency, limiting financialisation, capital movements and restricting imports.

          Attributing their growth to Globalisation is total bullshit from Neo-Liberal true believers.

          Countries who have swallowed the “open economy” bullshit are now borrowing trillions in printed money, from China, to survive.

  6. Draco T Bastard 6

    Instead, they pushed for policies that restructured markets in ways that increased inequality and undermined overall economic performance; growth actually slowed as the rules of the game were rewritten to advance the interests of banks and corporations – the rich and powerful – at the expense of everyone else.

    And that is the big one. The fact that the economy has been purposefully tilted in favour of the rich. National has always done that but Labour joined them in their undermining of the economy and our nation in the 1980s.

  7. Garibaldi 7

    5.2.2.1 Peter Ch Ch. Thank you very much for this insight to NZ’s stupidity. This is exactly what makes us despair for what used to be a great little country.
    This corruption is an upshot of very poor governance, which has grown with all this free market bullshit we have had to endure.

    • Peter Ch Ch 7.1

      But it does not need to be a ‘stupid little country’. Sadly, the governments (both Labour and National) have given away many of the assets of NZ. Largely uncontrolled immigration would have to be the worst mistake.

      And it IS uncontrolled in the sense that pretty much anyone with the equivalent of NZ$10,000 to $20,000 can get it by using the appropriate immigration broker.

      The government (Labour in the past, National now) must know what is happening. But I suppose this corrupt process channels a lot of much needed funds into NZ.

      • Garibaldi 7.1.1

        Peter @2.1 Thanks Peter , that’s exactly my point. Both National and Labour are guilty. The question is who is going to fix it?

  8. Macro 8

    This situation was predicted 18 years ago by John McMurtry in his book “Unequal Freedoms – the Global Market as an ethical system” 1998.

    The problem of the Global Market goes far deeper than the restriction of, and the redistribution of freedoms of choice and opportunity. Unnoticed is the destruction of ecosystems and environment, the systematic expansion of slavery and poverty, and ultimately the extinction of human values.

    The worlds oceans for instance are now not only garbage dumps of sewage and plastic but increasing more noisy (around 6dB per year) with super tankers and massive cargo ships constantly increasing in number as they truck fuel and “stuff” around the world.

    As mentioned previously the initial benefit for one country with minimal labour standards and hour pay rates quickly moves on to the next vulnerable country as pay rates and conditions improve. The race to the bottom is the only result.

    Savage recognised the threat of unrestricted importation in 1935 and quickly place massive quotas and restrictions on imports which existed up until the Douglas travesty of 1984. Over that time period NZ became one of the most equal and well provided countries on Earth. Since then we have steadily become a backwater and inequality and the loss of community and caring is now widespread. We still have someway to go to end up in the 3rd world category – but never fear – National and Act are working on it.

    • Draco T Bastard 8.1

      We still have someway to go to end up in the 3rd world category – but never fear – National and Act are working on it.

      QFT

      Throughout history capitalism in its various forms has always resulted in increased poverty for the many, great wealth for a few and the inevitable collapse of the society that allows capitalists to rule.

  9. Kevin 9

    “The main message of Globalization and its Discontents was that the problem was not globalization, but how the process was being managed. ”

    Bollocks. It IS being managed exactly as it was intended. At no point has the labour of the corporate profit machines been fully rewarded for their effort.

    Globalisation has just meant obscene profits for those with the money and a constant declining standard of living and debt entrapment for those without.

    End of story.

    • Reddelusion 9.1

      Nup globalisation is good as per Peter ch ch comments , the way it is been managed re disruption and time it takes as economies and people need to recalibrate plus equity issues needs to be managed better and fairer However this should be done in an overall neo liberal framework In essence don’t throw the baby out with the bath water re ga ga socialism and closed economies

    • Observer Tokoroa 9.2

      .
      Yes Kevin – you are right !
      .
      .”Globalisation has just meant obscene profits for those with the money and a constant declining standard of living and debt entrapment for those without.”

      The mechanisation of Industry and Rural product as I understood it, was meant to make everyone wealthier and reduce the long hours of work. But mechanisation added to cheap imports from China, Bangladesh and India have produced lowered wages and lessened access to resources and opportunity for many millions of people in many countries.

      On such low wages as now exist no ordinary worker in New Zealand is able to afford a home – and is facing horrific open ended rents paid to local and foreign landlords.

      Stigkitz – see his article today on Globilisation on today’s Standard 8/08/8 – He gives the following information:

      “Large segments of the population in advanced countries have not been doing well: in the US, the bottom 90% has endured income stagnation for a third of a century. Median income for full-time male workers is actually lower in real (inflation-adjusted) terms than it was 42 years ago. At the bottom, real wages are comparable to their level 60 years ago.”

      As I see it, to even begin to put to right the problems New Zealanders are facing in massive numbers – the wealth of Nations will have to retrieved from the wealthy. As part of that, imported goods must be forbidden if they impoverish the income of working citizens.

      .

      • Colonial Viper 9.2.1

        Median income for full-time male workers is actually lower in real (inflation-adjusted) terms than it was 42 years ago. At the bottom, real wages are comparable to their level 60 years ago.”

        And that’s if you are lucky to be a full time worker. It’s not considering how US labour force participation has fallen through the floor and youth unemployment is through the ceiling.

        As part of that, imported goods must be forbidden if they impoverish the income of working citizens.

        Correct. It’s time to break our free trade agreements and accept generally lower materialistic standards but with better social and community life.

        • Observer Tokoroa 9.2.1.1

          .
          . Yes Colonial Viper
          .
          . It is not just the loss of income when everyday items are imported from far away nations. It is the loss of skills within our own nation which is stupid and unforgiveable.

          And boy oh boy do the wealthy like destroying skills ! Yes they do. They will even completely shut Railway workshops, that can boast brilliant engineering for many decades, for no reason at all, except to give the manufacturing opportunities to their friends overseas.

          Sadly, they are often engineered with inferior products, welds and fasteners overseas.

          Wasting skills is a scandal. A corruption.

          .

    • joe90 9.3

      Globalisation has just meant obscene profits for those with the money and a constant declining standard of living and debt entrapment for those without.

      And all while they, the one and 0.1 percenters, thieve productivity gains.

      As a consequence, examining market-based incomes one finds that “the top 1 percent of households have secured a very large share of all of the gains in income—59.9 percent of the gains from 1979–2007, while the top 0.1 percent seized an even more disproportionate share: 36 percent. In comparison, only 8.6 percent of income gains have gone to the bottom 90 percent” (Mishel and Bivens 2011).

      http://www.epi.org/publication/ib330-productivity-vs-compensation/

      • Observer Tokoroa 9.3.1

        .

        . Hi Joe 90

        . Your information is right on. We need to be saying these true things face to face, throughout our New Zealand.

        . We must hang it on the Government of the present 8 years. We must demand the return of wealth to the community.

        . The Government which has been in charge (don’t laugh) consists of the following failures:

        . The Nationals; The Act; The Maori Party; The United Future.
        .

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