Will Globalization be a Victim of Imploding Economies?
BNET readers usually have a lot to say about globalization, especially when it comes to outsourcing jobs to other countries. So those of you who see globalization as more threat to national strength than a positive might take some solace from Harvard professor Dani Rodrik.
Although supportive of globalism, Rodrik believes that the unfolding economic crisis may check its expansion. In a recent interview he observes:
"I think what that is going to lead to is not necessarily a major backlash or an overnight reversal, but a gradual erosion of those principals -- of multilateralism, open economic borders -- that over time could be quite dangerous."He says policy leaders and economists need to arrive at a consensus around "what kind of globalization we want, what kind of institutions come with it and how can we reinvent our global economic arrangements. Because they do need reinvention."
It's an interesting observation. And we've seen this before in other contexts. When commidity food prices started to overheat the last few years, more and more countries began to sing the "self-sufficiency" song. China, for one, now aims for 95 percent self-sufficiency to feed its own citizens and keep prices stable.
Problem is, solving a growing demand worldwide for food that could double in 40 years calls for countries to work together to share resources and serve markets in need. (The increasing demand reflects changing diets as much as population gowth.) A bunch of nations looking out for only their own citizens leaves little left over to ship to countries that rely on imports.
Do you think our rapid rate of globalization is going to become unplugged in this downturn? Is that a good thing? Or is coordinated global action the best way through this recession?