Is the free mar­ket los­ing its buy­ers?

Trump's vic­tory shows grow­ing dis­com­fort with glob­al­i­sa­tion

Down to Earth - - COVER STORY - RICHARD MA­HA­P­A­TRA SUB­HO­JIT GOSWAMI AND

HE DE­VEL­OPED world’s poor­est coun­try—the United States of Amer­ica (usa)—has voted for its new pres­i­dent. The vic­tory of Don­ald Trump was un­ex­pected. But the anger that fu­elled his vic­tory was very much ex­pected, and sends out a clear mes­sage. It ques­tions the free mar­ket model of econ­omy that has been the only model in ex­is­tence for more than half of the world’s pop­u­la­tion.

Cham­pi­oned by the de­vel­oped world, the free mar­ket econ­omy has been un­der scru­tiny since 1990. But de­vel­op­ments in the af­ter­math of the re­ces­sion of 2008 show that coun­tries are in­creas­ingly los­ing in­ter­est in this model of econ­omy. The re­ces­sion wiped out 13 per cent of the global production and 20 per cent of the global trade. In fact, its im­pacts are still be­ing felt across de­vel­oped coun­tries. Bri­tain’s sur­prise vote to leave the Euro­pean Union (Brexit) was the big­gest re­al­ity check on the ef­fi­cacy of glob­al­i­sa­tion, while high un­em­ploy­ment in Spain and se­vere eco­nomic crisis in Greece that led to adop­tion of aus­ter­ity mea­sures across the coun­tries were wake-up calls. Opin­ion poll after opin­ion poll, in­clud­ing the one from the Pew Re­search Cen­ter, a Wash­ing­ton-based fact tank, sug­gests that many Euro­pean coun­tries want to fol­low in Bri­tain’s foot­steps and exit the Euro­pean Union to pur­sue their sovereignty over de­ci­sion-mak­ing and econ­omy.

This sen­ti­ment was re­flected dur­ing the US pres­i­den­tial elec­tion cam­paigns when un­usual re­ports filled the news­pa­pers. “No­body is talk­ing about the 43 mil­lion poor of US”. “Vot­ers can’t buy bus tick­ets to go to the poll sta­tion”. “usa just closes its eyes to the in­equal­ity”. Then there were the kind of slo­gans Trump made: Stop out­sourc­ing Amer­i­can job to In­dia and China; De­port il­le­gal mi­grants from the coun­try. The cam­paign slo­gans had an un­canny sim­i­lar­ity with those made in de­vel­op­ing coun­tries: free the mar­ket econ­omy; cre­ate jobs for the lo­cals; erad­i­cate poverty. This is the rea­son Trump won, even though he has ac­cu­mu­lated his for­tune by reap­ing the ben­e­fits of free trade.

For the world yet to over­come the Brexit shock, Trump is just a rude re­minder that there is some fun­da­men­tal prob­lem with the free mar­ket model. “Don­ald Trump’s vic­tory should serve as a les­son for Europe’s main­stream forces ahead of their own bal­lots next year. Pol­i­tics as usual just does not work on both sides of the At­lantic. Clearly,

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