Economics

Mondialisation du mécontentement

Dec 5, 2017 Joseph E. Stiglitz

NEW-YORK – Il y a 15 ans j'ai écrit un livre intitulé La Grande désillusion dans lequel j'essayais d'expliquer pourquoi la mondialisation a suscité tellement de mécontentement dans les pays en développement. Un grand nombre de gens estimaient que le système était dirigé contre eux et ils pointaient du doigt les accords sur le commerce mondial comme particulièrement inéquitables.

Aux USA et dans d'autres pays avancés, la désillusion suscitée par la mondialisation alimente depuis quelques temps une vague de populisme, sous la houlette de politiciens qui déclarent que le système est inéquitable à l'égard de leur pays. Ainsi Donald Trump prétend que les négociateurs américains sur le commerce se sont fait manipuler par ceux du Mexique et de la Chine.

Pourquoi la mondialisation qui devait bénéficier à tous, aussi bien dans les pays développés que dans les pays en développement, est-elle maintenant dénoncée presque partout ? Comment un accord commercial peut-il être désavantageux pour toutes les parties signataires ?

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Joseph E. Stiglitz

Writing for PS since 2001
331 Commentaries

Joseph E. Stiglitz, a Nobel laureate in economics and University Professor at Columbia University, is a former chief economist of the World Bank (1997-2000), chair of the US President’s Council of Economic Advisers, and co-chair of the High-Level Commission on Carbon Prices. He is Co-Chair of the Independent Commission for the Reform of International Corporate Taxation and was lead author of the 1995 IPCC Climate Assessment.

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ginsonmurangiri Oct 14, 2018

Globalization has brought nothing but inequality.Am yet to see the best part of globalization;in reality.
- Greg Cheverall Dec 10, 2018
  
  Visit NY or London.
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motleyfoe Jan 2, 2018

Given the "twin deficits" of finance & trade so long prevalent in the USA, it's difficult to imagine how America's unbridled stock market speculative fervor and the globe's relative weakness (vis-à-vis the USA) can combine to manufacture a demand for dollars sufficient to offset what HAS TO BE overwhelming, cumulative pressures weakening the dollar.... IS THIS ELECTRONIC AGE-- accelerated circulation of America's money supply-- (strictly) MONETARY ECONOMICS???
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Varsovian Warsaw Dec 19, 2017

We are not facing "globalization" but mercantilism. That's one huge difference! The supreme example of this is how Germany has used the euro to hijack the EU economy, inflicting misery oncountless millions. The EU must either (i) unite as a country OR (ii) resurrect national currencies and/or redistribute wealth massively OR (iii) continue until it collapses in spectacular fashion.

Options (i) and (ii) are not possible, because the Germans are the huge winners in the Euro deal, so we're just gonna have to hang around until (iii) happens. Which could be another 30 years away. It just depends how long it takes for the Italian, Belgian and French economies to get to a point where the electorate can no longer take the pain.
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Anna Peters Dec 13, 2017

I don´t remember who said that applying the Swedish constitution to any other country would fail as the other countries are Swedish-people- lacking .
When Mr Stiglitz proposed the nordic way as the answer he lost me there . Is he seriously saying that the answer for countries like USA ( not very keen historically to government intrussion nor to high taxes ) is a nordic model based in stratosferic taxation plus a government´s 360º presence ?
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Michael Parsons Dec 11, 2017

'If globalisation worked as it should'? What makes you think it isn't? The triumph of an unfettered pursuit of profit regardless of social costs is what capitalism is, and their is no 'acceptable face' of it.
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Clement Gavi Dec 10, 2017

'We can learn from such successes what to do, just as we can learn from past mistakes what not to do.'

Because like a piece of paper moved by the wind is submitted to determination, humans too are submitted to determination. But unlike a piece of paper it is given in humans' intelligible nature the ability to extract themselves from determination. Strictly globalization isn't external reality, it is outcome of humans' thought. Humans have conceived globalization in this perspective globalization remains something they can work on as they can work with. That is it can be adjusted by the given in experiences.
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Peter Richman Dec 9, 2017

Stop
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Jerry Syder Dec 7, 2017

This is a nobel winning economist? Asking the U.S. to emulate Denmark, Norway, and Sweden, who's combined population is maybe 1/20 of the U.S. is ridiculous on its face. I agree that greedy corporate interests have hijacked the global economy, but a lot more than just protecting worker's rights needs to be done to help American working class.
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Janos Nagy Dec 6, 2017

And finally.
If look at globalization as a political movement.
The communist belief based on that wealth must be taken away from the wealthy and give it to the poorer.
So we can state that globalization is nothing but a Communism 2.0
No surprise that most left leaning politicians and economists are the biggest propagandist for it.
No if you don't get it it's simple.
Communism 1.0 was about taking away the wealth and give it to the poorer within a few nations that the communists took over.
Of course it did not work because it run out of the possible taking from someone and eventually it started to share the nothing that the planned economic system offerd.

Now communism 2.
Same thing but the wealth was transferred from the wealthier or middle class in the developed countries to the poorer in the not developed countries because in a communist eyes the middle-class were the wealthy worker that must be forced to share it's wealth with the poorer in other countries.
Corporations gladly took participation because they were left alone.
It was not hard to influence the corporations by the communists after all they were promised more profits and no responsibility.
The target was and are the middle-class to be sacrificed.
And of course because it is great for the corporations they would influence the right thinking politicians that yes globalization is great.
In communism 1.0 governments could not increase the debt to substitute for the missing wealth available to transfer to the poorer.
In communism 2.0 or globalization 1.0 governments managed to continue the wealth transfer from the middle-class by new debts.
Yes the middle-class wealth is in minus.
Bush and Obama 14 trillion in 12 years.
And 2008 was not a financial crisis but the very crisis that globalization created in a short 10 years.
The USA had an official economic policy that was based on housing a substitute for the missing manufacturing.
Don't blame the banks blame your governments that was actually allowed communism 2.0 to destroy the middle-class.
And of course the left pointing the finger that we told you so capitalism is bad and we need socialism NOW.
And the right is clueless.
And the economists take Adam Smith observations about his time of economics like the bible.
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Janos Nagy Dec 6, 2017

Economics has nothing to do with politics or left or right political belief.
It is interesting that it became Trump's faults all that globalist has created.
But why not just put the blame where it is should be.
Yes the 2 ex Presidents namely Bush and Obama and all the economists that has no clue how the capitalist economic system works based on profits and debt.
Some of the comments are right on.
First the capitalist economic system is a closed economic system that is not compatible with the globalist economic implementations.
The very basic rules
Profit creates debt!
If profits not reinvested where it created the debt than income will be reduced and inequalities will increase.
So globalization globalized profits but nationalized the debt.
Globalist just broke the most basic mechanism of the capitalist economic system that profits must be redistributed or reinvested where it created the debt.
If you have any doubt check the debt level person and governments in the USA and here in Canada as well.
Here in Canada the personal debt level was around 90 to 100 percent before globalization as long you can find a statistic till around 2002 now it getting close to 180.
Also if corporations can move globally why can't people move globally.
Why we don't have a single global currency and a single global vat tax because income taxes are very much local.
Globalist very conveniently forgot to implement the necessary changes in policies and taxes.
Are anyone surprised that so many people looking at the solution of socialism or even a communist system.
Globalist has broken the capitalist economic system an blame it on Trump.
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Ian Maitland Dec 6, 2017

Another day, more badmouthing of globalization from Joe Stiglitz. The fact is that globalization worked. As Angus Deaton has said: “Life is better now than at almost any time in history. More people are richer and fewer people live in dire poverty. Lives are longer and parents no longer routinely watch a quarter of their children die.” Between 1970 and 2006, the percentage of the world population in poverty has fallen by 80 percent from 27% to 5%. The corresponding total number of poor has fallen from 403 million in 1970 to 152 million in 2006. At the same time, various measures of global inequality have declined substantially and measures of global welfare increased by somewhere between 128% and 145% (Pinkovskiy.& Sala-i-Martin 2009).
It is hard to exaggerate how dramatic the change has been. In the 1960s and 1970s, for example, Peter Singer placed Bangladesh in the "hopeless" category. "We have no obligation to assist countries whose government make our aid ineffective," Singer wrote. Paul Ehrlich (1968) wrote off India. Garrett Hardin used the lifeboat earth metaphor to argue against helping the world's poorest. That help would lead to unsustainable population growth that would capsize the lifeboat, so they had to be thrown overboard.
The golden era of globalization was the result of the intellectual and economic bankruptcy of the old development model. As Deaton says, from its beginnings after WWII, “development economics saw growth and poverty reduction as technical problems. Economists would provide the knowledge that would tell the newly independent rulers how to bring prosperity to their people.” Their advice would be backed by large influxes of foreign aid. One of the flaws in this model, as Deaton says, is that it ignored politics and assumed that national leaders and officials were motivated to promote the public welfare.
Globalization was mostly about the lifting of barriers to trade and investment. The era has been called "the age of Milton Friedman" by Andrei Shleifer (2009) because it marked a stride toward a global free market. The miracle of globalization was, accidentally or on purpose, the result of the unleashing of market forces. Instead of planners, it was corporations and greater market openness that drove this transformation. But the transformation was not the result of policies urged on corporations by advocates of global CSR or NGOs or the World Bank. It was accomplished, as if by an invisible hand, by corporations pursuing opportunities for profit around the globe. That is the same corporations that sees as conspiring to rig the world in their favor.
Stiglitz is on the wrong side of history, and he is an enemy of the hopes of the world's poor.
- Henry Rech Dec 6, 2017
  
  The corporations that benefited from globalization were able to do so because they were able to exploit the disparities in market power between themselves and the millions of workers that they employed. This employment is akin to slavery. How is it that shoes and shirts and that cost tens of cents to make retail in the west for tens of dollars? These exploited workers might be better off than they might otherwise have been, however, they are still the working poor and they have displaced workers in the west. Global corporations are well placed to manipulate the political processes at home and abroad and international labour markets. The generalized figures regarding poverty and income distribution quoted above hide the facts rather than enlighten.
  - Ian Maitland Dec 6, 2017
    
    Henry:
    That is flat-out wrong. Retail -- especially apparel and footwear -- is highly competitive. Market power is weak. That goes for the international labor market, and it goes for the domestic marketplace as well. Retailers have not cashed in big-time from the lower costs (compared to the US) of sourcing from poor countries. Those costs savings have been passed on to Western consumers. Since you have a zero-sum view of the world, let me point out that that is a win-win outcome.
    In any case, the key point is that US and European retailers gave large pay increases to Third World workers. That is why Deaton can say “Life is better now than at almost any time in history. More people are richer and fewer people live in dire poverty." Try asking some of those workers if they are better off. (I have).
    Those numbers tell the truth, and you offer no evidence to show they don't.
    The worst thing about your Marxian fairy tale is not that it is wrong. It is that you recklessly disregard the harm you are doing by spreading it.
    - Henry Rech Dec 7, 2017
      
      Ian,
      
      I did not say they were not better off. I said they are exploited.
      - Ian Maitland Dec 7, 2017
        
        Henry:
        When I next want a pay raise, I'll ask you to exploit me.
        Ian
        
        Henry Rech Dec 7, 2017
        
        Ian,
        
        At one time, I knew one of the larger shirt importers into Australia (he died some years ago). I knew what he paid per shirt (that was the manufacturer's price, not what the manufacturer paid his workers per shirt), what my friend sold the shirts to the retailers for and what the retailers sold the shirts to the public for. I assure you their profit margins were huge. It's a shame he's not alive. I am sure he could have referred you to the manufacturer - I have no doubt he could have organized one of these jobs for you that you appear to so much covet.
        
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        Henry Rech Dec 7, 2017
        
        Ian,
        
        If the these exploited workers have such a great life I presume you would more than willing to trade places with them.
        
        Ian Maitland Dec 7, 2017
        
        Henry:
        Nice try. I would accept your offer with alacrity if the alternative was working on my father's subsistence farm in Central Java where I would earn a fraction of what Nike pays in Serang.
        But you would take away that choice for millions of subsistence workers. In the name of paying them a living wage, you would leave them with no wage at all, because your conscience is shocked by the wages paid at sweatshops in Serang or Tangerang and similar places. Your clean conscience has far too high a human price.
        If retailers are making such obscene profits, then why are those profits not reflected in retail industry's stock prices? Over the last 20 years, the CPI for clothing has fallen by 3.3%, while overall prices increased by 63.5%. Millions of jobs for the world's poorest workers in the world AND cheaper clothing for Americans. I call that win-win.
        
        Henry Rech Dec 7, 2017
        
        I did not say it wasn't a win - win. I would say one wins infinitely more than the other. Just because the workers have been tossed a few crumbs does not mean all is well with the world. And of course, the losers have been western workers.
        
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- Janos Nagy Dec 6, 2017
  
  Yes indeed it worked.
  New debt since globalization started around 1999 are 30 trillion dollars in the developed countries .
  When was the last time you checked trade between India and Pakistan and Bangladesh. More than 2 billion people and trading is basically zero.
  - Ian Maitland Dec 7, 2017
    
    And your point is...? Bangladesh is worse off?
    Remember, as I pointed out, the experts had pronounced Bangladesh dead.
    - Janos Nagy Dec 7, 2017
      
      And who cares about Bangladesh they certainly don't care about the 250 thousand workers lost their jobs and make less in part time jobs than 20 years ago here in Canada.
      And that is your win win
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    - Janos Nagy Dec 7, 2017
      
      My point is globalization is not a win win the trillions of debt paying for it and future more and more debt can only keep it alive. Globalization not just undermined the basic capitalist economic system but brought out the worst outcome of it that only stupid politicians could support. In the simplest term income spent must be equal income earned or you got debt.
      So what will happen when governments don’t want to get more debt.
      The personal debt level already 180 percent from 90 since 2001.
      Why are these countries unable to trade between them 2 billion costumers are not enough why can't they create the wealth just selling among themselves?
      - Ian Maitland Dec 7, 2017
        
        Janos:
        
        Thanks for the clarification. Yes, I too am worried about mounting debt (even if the stock market isn't). But you seem awfully certain you know what the outcome will be. I don't have that confidence. (Krugman for one has pooh-poohed fears about national debt having a tipping point). In principle, debt is not a problem, so long as you can grow the economy enough to finance it, and then some.
        
        But I still don't get your fascination with trade between India and Bangladesh. Isn't the whole point of trade that it creates greater value if the countries are different than if they are similar? (OK proximity matters too).
        
        Should economic policy really be about preserving the jobs of Canadian auto workers if cars (or is it apparel?) can be made more cheaply in Bangladesh, thus simultaneously lifting up the poorest workers in the world and (effectively) giving a pay raise to all (employed) Canadian workers? Change happens. Should we outlaw innovation because it just as surely creates unemployment in particular industries as foreign trade does? Or ban vegetables being imported from BC to Ontario in order to preserve the jobs of farmers in Ontario?
        That is literally a bankrupt solution. True, we could do a lot more to compensate the losers from international trade out of the gains it generates. But do you really think the stunning growth created by globalization had greater costs than benefits?
        Ian
        
        Janos Nagy Dec 8, 2017
        
        Dear Ian
        
        You just said it
        Debt is no problem as long you can grow the economy and pay for it.
        So here it is in numbers or the effect of the globalization.
        USA 1 trillion new yearly debt since Bush and Obama around 2004 just by the federal government It is an average each year.
        1 trillion in average is 5 to 7 percent of the GDP for those times.
        Growth average less than 2 percent a year.
        So it is obvious that the ability to pay for it by growing the economy just somehow doesn't exist.
        
        1 trillion actually 10000 dollars for 100 million household each year.
        Yes 100 million household got an extra 10 thousand dollars from the government each year by borrowing to pay for the cheap products that is apparently is their win in the globalization.
        1 trillion in average actually substitute for 20 million jobs with 50 thousand dollars each.
        Of course you trade labor, taxes and profits each time when trading an economic output between countries.
        The real deficit is in labor(jobs) just with China are about 25 million jobs deficit by the trades.
        And that is the real reason for the deficits.
        I don't have time and space to explain the fundamentals of economic democracy and economic right of individuals in their own economic jurisdiction but shortly
        It is the very basic economic right of an individual in their respective economic jurisdiction to be able to sell their labor for a fair market value without any interference by governments policies taxes regulations especially trade arrangements that directly discriminate against their basic economic rights.
        Economic democracy and economic rights are the most important elements in a truly democratic country.
        
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Janos Nagy Dec 6, 2017

Ther is a serious problem with this statement by mr Stiglitz "reducing the trade deficit, which is determined by the disparity between domestic savings and investment."
I know economists like to make this comment about trade balance but it is not valid at all.
I'm curious what calculations they could use to make it valid.
Savings must be equal to the borrowing otherwise it has a negative effect on the gdp.It is not possible in an economic jurisdiction created by not just physical borders but their own respective regulations taxes and policies we call it a nation to be everyone a saver. Basically borrowers must use "invest" the savings.
Trade deficit is a deficit between economic jurisdictions and has no connection to the domestic savings and investments. Now foreign investment has nothing to do with trade balance.
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M M Dec 6, 2017

There is not one jacket fits all neither can there ever be. ...The Nordic model is not without its flaws and cracks have started to show in it. To suggest that the Nordic model is the solution to the problems facing humanity, from social to economical to political to educational, etc..is at best wishful thinking. Thank you.
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Bernhard Kopp Dec 6, 2017

One of many possible tools to alleviate the negative consequences of globalization could be to implement a VAT, of at least 15-20%, on all imported finished goods, particularly in the US, to pay for 'social entitlements', particularly health insurance and pensions. This would relieve a major part of the burden from local businesses and employees.
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Enrique Fleischmann Dec 6, 2017

With the utmost respect for Prof. Stiglitz, I would like to add a few comments:
1. Trade arrangements does not equal globalization: As long as the "free flow" excludes an unconstrained labor mobility between countries ( the most important production factor) we cannot speak about "globalization" as a proxy to free markets.
2. The loss of bargaining power of the nation based workers´ is inherent to the "globalization" model.
Explanation : A closed economy model ( typical for the post WW2 decades) relied upon the local/national mass consumer and its purchasing capacity.
Since mass consumption is closely related to salaries, the closed economic system was obliged to maintain a decent labor share out of national income in order to ensure sales and profits. Statistics on Labor share confirm the thesis.

In a globalized economy, firms are less dependent on local purchasing power (since they sell abroad) : More over, they must compete with foreign cost, so we get a vicious circle of lower labor costs in which everyone try to reduce local cost and hope that the foreign consumer remains healthy. Many countries (such as the Nordic) are the exemption to the rule: Others ( Brxit, Trump) are trying to adopt a protectionist response which is inadequate for the current system ( technology, supply chains, etc.).

In other words, the response to the race to bottom should be analyzed from a global perspective, as we are dealing with a global economic system.
- Enrique Fleischmann Dec 6, 2017
  
  With the utmost respect for Prof. Stiglitz, I would like to add a few comments:
  1. A trade arrangement does not equal globalization: As long as the "free flow" excludes an unconstrained labor mobility between countries (the most important production factor) we cannot speak about "globalization" as a proxy to free markets.
  
  2. The loss of bargaining power of the nation based workers´ is inherent to the "globalization" model.
  Explanation: A closed economy model ( typical for the post WW2 decades) relied upon the local/national mass consumer and its purchasing capacity.
  Since mass consumption is closely related to salaries, the closed economic system was obliged to maintain a decent labor share out of national income in order to ensure sales and profits. Statistics on Labor Share can confirm the above hypothesis.
  
  In a globalized economy, firms are less dependent on local purchasing power (since they sell abroad): More over, they must compete with foreign labor costs ,so we get a vicious circle in which everyone tries to reduce local cost while hoping that foreign consumers remain healthy.
  
  3. Many countries (such as the Nordic) are not more than the exemption to the rule: Others (Brexit, Trump, etc. ) are trying to adopt a protectionist response to the race to bottom . Still these responses are inadequate for the current economic system (technology, supply chains, etc.) and may work only for very big nations.
  
  In other words, the response to the race to bottom should be analyzed from a global perspective, as we are dealing with a global economic system.
  - Janos Nagy Dec 6, 2017
    
    Very week put
    Yes closed economic system! You said the secret words.I think most economists has no clue what are you talking about. I wish you would have describe it for the others to understand it.
    - Janos Nagy Dec 6, 2017
      
      Very well put
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Robert Wolff Dec 6, 2017

Unlikely the Western peoples will act like the Middle Eastern peoples have against Globalism, by rejecting their rulers supported by the Western New World Order fiat money system.
In the Middle East, numerous nations and peoples have revolted against increased ownership of their political elites that have used their fiat money systems to confiscate historic properties of 'Everyone Else' and placed their peoples under a 'Rent Economy'.
And the truth is, that US Oligarchs may not endure the same fate of Middle Eastern and North African oligarchs (murdered, to take back control of Society to historically indigenous people's religious/ethical rules) if US Oligarchs can institute a "Fair" distribution of income under US laws and regulations, which can stop a revolution of the "losers" in America against them.
The above is likely what Trump is trying to accomplish.
- jagjeet sinha Dec 6, 2017
  
  Yes indeed The Marginalized Majority have Democracy to voice their opinion.
  Globalization has a balance sheet - that cornered benefits for the One per cent.
  Both Developed and Developing countries are afflicted universally.
  The Bretton Woods Institutions Architecture builds wealth in pockets.
  Proliferation of wealth that Democracy demands - requires redesigning.
  Unfortunately the effort requires multilateral coordination - daunting at best.
  The Central Bank Governor has exhausted his repertoire - with ZIRP everywhere.
  Fiscal Redesign requires departures - for wealth building in the hinterlands.
  Remedies must not kill the goose - Globalization - in the euphoria with populism.
  Bretton Woods Architecture builds wealth in Belgravia not Birmingham.
  Democracy enables Fiscal Redesign - Chancellors prerogatives paramount.
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Robert REYNOLDS Dec 5, 2017

To portray globalization as something,

“….. which was supposed to benefit developed and developing countries alike …..”

is as misleading in the extreme, as it is risible.

Globalization, the free-market, economic rationalism, neo-liberalism, call it what you will, was always a capitalist confidence trick perpetrated by the rich on the poor. To paraphrase Shakespeare, fecal excrement, called by any other name, smells just as rotten.

Globalization, or capitalism on steroids, was always about accelerating the transfer of wealth from the poor to the rich. The trick being off course, was to throw the poor a few crumbs (and only where that was necessary, of course) to create the impression that they were benefiting from the process, while the real rewards went to the rich.

And do not forget, that the capitalist is not interested in nationalist boundaries whatsoever, the only thing that matters is profit - enough of which is never enough.

The consequences of going down this neo-liberal, free-market economic pathway were glaringly obvious right from the moment I heard the likes of politicians such as Ronald Reagan and Margaret Thatcher, economists such as Milton Friedman and Friedrich Hayek and fantasist authors of the Ayn Rand ilk, extolling the virtues of this economic poison. The outcome was never in doubt. It was destined to end in tears just as it does every time and in every place it is attempted, for example, in Dickensian England. But 40 or so years ago, few could be told. Few would listen.

The only real antidote to all this will be some attempt at a democratic socialist solution. The rising influence of politicians such as Bernie Sanders in the U.S. and Jeremy Corbyn in the U.K. is a small move in the right direction.

The ‘unbridled greed’ the Joe alludes to in his penultimate paragraph, needs to be tempered and brought under control. Policies associated with free-market forces only pour petrol on an already raging fire. Donald Trump’s latest tax cuts for the rich are a prime example of a capitalist class that is pouring petrol on the fire like there is no tomorrow. No wonder that Marx said that capitalism contains the seeds of its own destruction.
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Paul Daley Dec 5, 2017

Stiglitz would be better off looking at the imbalance between the real and financial sectors in the developed world. Right now producers of goods and services in the developed world can't compete with the producers of financial assets, whose value is often underwritten by central banks and gains from which are lightly taxed. Developed country assets are simply being offered at bargain prices, generating exchange market effects that disadvantage developed country exports. It's just the latest version of the "resource curse" that often plagues natural resource producers.

What to do? Remove the price supports from developed country asset markets, restrict the use of seigniorage and QE initiatives during expansions, and tax capital income, including capital gains, as you do earned income. In short, level the playing field in developed countries between those producing financial assets and those producing goods and services. And, in the future, be a little bit more careful to monitor who's subsidizing what, when you see surpluses emerging in either your current or your capital account.
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Steve Hurst Dec 5, 2017

A small town solution is unlikely to suit a big town so there is a big question over the Nordic model being applied in the US or the majors in Europe.

Lets assume the developed economies do come up with something under ballot box protest. That immediately raises the question of the majority of the population on the planet who are not in the developed economies. With the only too likely failure of the developed economies as they try to mimic the West all Hell is likely to be let loose. Actually however big the problem is in the West the chances are elsewhere there will be a much bigger problem
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stephan Edwards Dec 5, 2017

Well let's see how to put this. The winners of globalization will go with option 1. Which after all since they own the government outright. After all the current situation suits them nicely.
option 2: Well even Trump isn't supporting Trumpism. But boy appealed to the electorate. Which means there will be a lot of speeches alot of sound bytes but nothing will actually change. But there will be speeches and soundbytes but no actual change.
Option 3: Not going to happen. The so called Social Contract is deader then the dinosaurs. And as the recent Tax bill should prove the winners and their pet politicians don't care about the Social Contract, Social Stability, or anyone anything that isn't rich and influential. If only because the US or actually most of the developed world is effectively an oligarchy. And the Government is no longer interested or frankly cares about anyone who can't pay a "Campaign Donation".
Option 4 and the one I find most likely........ Violence. As people abandon the Ballot and the joke we call "Democracy" or Republican Democracy whatever you want call it. And it is a joke. For all their pretenses our so called elites neither care nor represent the commoners or perhaps I should say serfs. And at a certain point people are going to abandon the ballot box for the gun.....Why not? They have damn little to lose!
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Bernhard Kopp Dec 5, 2017

Warren Buffet referred to the workers displaced by globalization as 'road kill'. It probably was worse in the US than in Europe, but everywhere too much hope was placed on the self-healing forces of the free market economies. Many industrial regions became relatively wealthy over several generations, but poor within a few years, and far too many could not escape to greener pastures. The future will be different in detail, but the fundamental adjustment challenges will remain similar.
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Michael Public Dec 5, 2017

My humble opinion is I don't think 'the Scandinavian solution' can work everywhere because it requires that you have pre-existing world class education, social cohesion and infrastructure. Sure, others could catch up but that might take decades or even millennia.

One might suggest that better than this is that totally free trade corporations enjoy should be accompanied by the right of workers to relocate for work* anywhere in the World, and thus never be left holding nothing when the employment opportunities relocate.

Finally, local taxes should move to a much heavier VAT/sales tax content and should move away from income taxes which becomes non-functional in the context of global corporations.

*this would not entitle such workers to citizenship. If they cease working they must return to their own countries. Of course, a path to citizenship should be encouraged.
- Janos Nagy Dec 5, 2017
  
  You are right on the solution with taxes and workers movement. They implemented this so called globalization without implementing the proper taxes and regulatory changes.
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