The exponential rise of globalization in the past few decades has created winners and losers. Some of the losers are workers in the developed countries.Winners include corporations, capitalists, farmers, etc, in these countries. In addition, one of the biggest beneficiaries of globalization is the millions of workers in developing countries.
As the middle-class workers in the rich countries saw their jobs disappear and wealth accumulate in the hands of a few, they are revolting against the elite. Brexit in UK and the Trump victory in the US are two outcomes of the public’s rejection of the status quo. An article in Der Spiegel published yesterday discusses the impact of globalization in detail. From the article:
End of Globalization?
Now, though, those who have lost out are striking back, first in Britain and now in the US. And Italy and France could soon join them.
It is a fact that globalization and free trade have increased global prosperity, but they have also increased inequality in the world’s wealthiest nations. They have made the biggest companies more powerful, because business operates globally while politics tends to be a local or regional affair, and made the world more vulnerable to crises, because everything is networked and the debts of American homeowners could lead the entire world to the brink of collapse.
In short, globalization is responsible for a host of problems that would otherwise not exist. And it is therefore in the process of gambling away the trust of people around the world. Already today, global trade growth has slowed and state interference is on the rise.
The world finds itself at a turning point. It must try to eliminate the drawbacks of globalization without destroying its advantages. If, on the other hand, protectionism and populism gain the upper hand, there is a danger that global prosperity could shrink. The age of globalization would be at an end.
Source: A Turning Point for Globalization – Inequality, Market Chaos and Angry Voters, Der Spiegel
The entire article is worth a read.
Readers may also want to checkout After Trump’s victory China is the main strategic pillar for globalisation by Prof. John Ross of Renmin University of China.
The key takeaway is globalization is in itself not bad. But when the benefits of globalization does not reach everyone especially the workers then they will turn against the system that was meant to raise their living standards.