There is now no excuse for letting our policy-makers off the hookby Torsten Bell / September 13, 2016 / Leave a comment
From political rallies to university seminars, it is becoming fashionable to say that globalisation has led to stagnant living standards for working and middle classes of the developed world, leaving national governments powerless to deliver rising incomes and explaining rising political dissatisfaction with the status quo.
But these are dangerous words in such simple form, because they are both wrong and getting at something. Living standards in Britain and in many developed countries have seen phases of being squeezed. But we should beware concluding that responsibility for that rests entirely with a faceless force called globalisation—that if we reversed would put right all that is wrong with the world.
This question is not new. But the recent British decision to leave the European Union, the prominent place for trade policy in the end game of the current US presidential cycle and phoney war phase of national elections in France and Germany, means the issue has not just risen up the agenda—it is becoming the agenda in much of the developed world.
The debate across the west
Crucially this is a debate in flux—and where it settles will matter for our politics and economics for decades to come. In the face of popular frustration progressives are rethinking where they stand on questions from trade to migration. In the US a Democrat President is pushing trade deals that cross both the Pacific and Atlantic, amidst a growing debate in his own party about the very desirability of free trade in the first place. Both Francois Hollande and Sigmar Gabriel have adopted significantly tougher rhetoric against the same trade deal between the EU and US that Obama champions. The British Labour Party faces the challenge of redefining its vision of Britain’s role in a post-Brexit world. Owen Smith, the challenger in the Party’s current leadership election, favours another public vote on EU membership, while Jeremy Corbyn, the leader he is challenging, seems to view the Single Market as a ratchet to drive down labour market standards, rather than as the collective mechanism of relatively rich European countries for avoiding exactly that.
On the right, Donald Trump has reversed overnight the Republican traditional advocacy of free trade, instead seeing it as…