February 01, 2004

Why the Rich Fear Globalization

Posted by shonk at 03:40 AM in Economics | TrackBack

After finishing up The Ball and the Cross this evening, I spent some time catching up on some old posts scraped by my aggregator and came across a post at AnarCapLib that linked to an Indian article on “Why the rich fear globalisation”. I was reminded, of course, of Curt’s recent post and the linked Wired article about outsourcing to India. One of the points made in that article stood out:

What begins to seep through their well-tiled arguments about quality, efficiency, and optimization is a view that Americans, who have long celebrated the sweetness of dynamic capitalism, must get used to the concept that it works for non-Americans, too. Programming jobs have delivered a nice upper-middle-class lifestyle to the people in this room. They own apartments. They drive new cars. They surf the Internet and watch American television and sip cappuccinos. Isn’t the emergence of a vibrant middle class in an otherwise poor country a spectacular achievement, the very confirmation of the wonders of globalization - not to mention a new market for American goods and services? And if this transition pinches a little, aren’t Americans being a tad hypocritical by whining about it? After all, where is it written that IT jobs somehow belong to Americans - and that any non-American who does such work is stealing the job from its rightful owner?

In “Why the rich fear globalisation”, Surjit Bhalla makes something of a similar point:

The leaders and operators of the anti-globalisation movement are the formerly colonising rich whites, who, as per their heritage, need non-white intellectuals as their disciples and followers.

Fundamentally, Bhalla’s argument is based on the following simple observation:

During the twenty years pre-globalisation period (1960-1980), per capita incomes in the poor world grew at 2 per cent per annum compared to the rich industrialised world’s growth rate of 3.4 per cent i.e. the poor world grew at a considerably slower rate.

In the globalisation period (post 1980), the poor countries began their long march towards catch-up. In sharp contrast to the previous 20 years, the fortunes were exactly reversed —the poor economies registered a growth rate double that experienced by the rich countries - 3 per cent per annum compared to the rich countries considerably slower growth of 1.5 per cent per annum. And the poor in the two poorest countries, India and China, saw their incomes increase at an even faster pace — above 5 per cent per annum for over 20 years.

Coincidence? Maybe, but I suspect not. The “intellectual” vanguard of the anti-globalization movement may or may not be motivated by a different sort of “intellectual vulgarity” (to use Curt’s phrase), but the rank-and-file of the anti-globalization movement, the people that make it something to be reckoned with are more likely, I suspect, to fit the profile of the Pissed-Off Programmer described in the Wired article, people motivated not by a desire to actually help those in the third world, but rather by their own pocketbook. Which I can certainly understand, but spare me the platitudes.