Re-think policy action

This refers to “Global trade war spooks markets; Sensex slumps” (March 24). The recent trade war fear involving mainly the US and China points to the question of how an economic ideology to govern a country remains unsolved at best. This is a byproduct of the reality that globalisation coupled with crony capitalism, during the last two decades, has ended up increasing inequalities among different countries and within the countries as well. It has also resulted in massive job losses in the western world. Along with this, the technological advances in the area of artificial intelligence have led to a drastic decline in the demand for labour both in the developed and developing countries across industries. There seems to be no immediate concrete solution to the problem of unemployment with anyone.

This development needs to be evaluated in the political context. Ruling politicians in many countries have promised to solve several economic ills inflicted on their economies, particularly job losses, but are finding it difficult to deliver on the promises. This has made them believe that closing their economies by erecting tariff barriers to protect domestic industries will help them generate jobs. Thus, it becomes imperative for the world leaders to re-think policy actions that benefit all countries rather than furthering the interests of any one nation.

It should not be forgotten that sound economics consists of taking into account long-term effects of a particular policy on all rather than short-term effects on a particular group.

Ketan K Shah Ahmedabad