1/7
Greg Ip argues here that globalization, which was already in retreat in the past decade, is likely to be further hurt, perhaps badly, by Russia's actions in the Ukraine. I agree.
@greg_ip
wsj.com/articles/clash… via @WSJ
Greg Ip argues here that globalization, which was already in retreat in the past decade, is likely to be further hurt, perhaps badly, by Russia's actions in the Ukraine. I agree.
@greg_ip
wsj.com/articles/clash… via @WSJ
2/7
Events in the Ukraine and elsewhere seem to reinforce claims made by some people, like Kristalina Georgieva at the IMF, that a world in which countries increasingly raise barriers to trade is also likely to be one of increasing geopolitical tension and conflict.
Events in the Ukraine and elsewhere seem to reinforce claims made by some people, like Kristalina Georgieva at the IMF, that a world in which countries increasingly raise barriers to trade is also likely to be one of increasing geopolitical tension and conflict.
3/7
I look at it differently. I'd argue that both trade and geopolitical conflicts are likely to reflect the same underlying imbalances, in which case a stronger commitment to the existing global trade regime won't reduce geopolitical tension but may instead make them worse.
I look at it differently. I'd argue that both trade and geopolitical conflicts are likely to reflect the same underlying imbalances, in which case a stronger commitment to the existing global trade regime won't reduce geopolitical tension but may instead make them worse.
4/7
Our problem isn't globalization per se so much as the form of globalization with which we've been stuck for the past several decades, in which among other things massively disruptive financial flows accommodate large and persistent trade imbalances.
Our problem isn't globalization per se so much as the form of globalization with which we've been stuck for the past several decades, in which among other things massively disruptive financial flows accommodate large and persistent trade imbalances.
5/7
Just as Keynes feared at Bretton Woods, these imbalances are resolved not with expansionary pressure in persistent surplus countries but rather with contractionary pressure in persistent deficit countries.
Just as Keynes feared at Bretton Woods, these imbalances are resolved not with expansionary pressure in persistent surplus countries but rather with contractionary pressure in persistent deficit countries.
6/7
As a result, among the consequences of this form of globalization are downward pressure on wages, as countries struggle to become internationally competitive and, in order to counter the impact of stagnant wages, soaring debt.
As a result, among the consequences of this form of globalization are downward pressure on wages, as countries struggle to become internationally competitive and, in order to counter the impact of stagnant wages, soaring debt.
7/7
Unfortunately the current debate seems mostly to be about more globalization versus more isolation, when it should instead be about what kind of global trade regime we want – one in which economies "win" by boosting productivity, or one in which they "win" by cutting wages.
Unfortunately the current debate seems mostly to be about more globalization versus more isolation, when it should instead be about what kind of global trade regime we want – one in which economies "win" by boosting productivity, or one in which they "win" by cutting wages.
1/3
The data show "that while manufacturing has declined as a share of GDP in some nations (notably Canada, Italy, Spain, the United Kingdom, and the United States), it is stable or growing in...
itif.org/publications/2…
The data show "that while manufacturing has declined as a share of GDP in some nations (notably Canada, Italy, Spain, the United Kingdom, and the United States), it is stable or growing in...
itif.org/publications/2…
2/3
many others (including Austria, China, Finland, Germany, Japan, Korea, the Netherlands, and Sweden). The loss of U.S. manufacturing is not due to some inexorable shift to a post-industrial economy; it is due...
many others (including Austria, China, Finland, Germany, Japan, Korea, the Netherlands, and Sweden). The loss of U.S. manufacturing is not due to some inexorable shift to a post-industrial economy; it is due...
3/3
to a failure of U.S. policies (for example, underinvestment in manufacturing technology support policies and a corporate tax rate that is increasingly uncompetitive) and the expansion of other nations’ mercantilist policies."
to a failure of U.S. policies (for example, underinvestment in manufacturing technology support policies and a corporate tax rate that is increasingly uncompetitive) and the expansion of other nations’ mercantilist policies."
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