Hate glob­al­i­sa­tion? Try lo­cal­ism, not na­tion­al­ism

Chronicle (Zimbabwe) - - Feature/national News - Kevin Al­bert­son

IT hardly needs say­ing, but there are changes afoot in the po­lit­i­cal econ­omy of the world. Where there is glob­al­i­sa­tion, there are glob­al­i­sa­tion pro­tes­tors. This is noth­ing new, but it is be­com­ing main­stream.

The an­tithe­sis of glob­al­i­sa­tion, na­tion­al­ism, and the pur­suit of your own coun­try’s in­ter­ests over those of ev­ery­one else, has bub­bled back up in Europe. And it’s not just Europe, of course.

In the US, pres­i­dent Don­ald Trump is (among other ini­tia­tives) re­think­ing the Amer­i­can com­mit­ment to free trade.

In the rest of the world, the ex­pe­ri­ence of glob­al­i­sa­tion shows it cre­ates some win­ners and some losers. This varies ge­o­graph­i­cally and in dif­fer­ent eco­nomic fields, and is shown in dif­fer­ent as­pects of our lives.

And so, some­one in Lon­don might find their house is worth more. As for­eign cap­i­tal flows in to buy up large swaths of the cap­i­tal it in­creases their wealth, while oth­ers might be priced out of the mar­ket. In some sec­tors of the mar­ket, wages might be de­clin­ing as a re­sult of global com­pe­ti­tion, mi­gra­tion, ca­su­al­i­sa­tion or automation. In the final anal­y­sis, how­ever, it is not a mat­ter of whether glob­al­i­sa­tion causes these changes; it is rather more that peo­ple feel that it does.

Glob­al­i­sa­tion is not, how­ever, merely a mat­ter of trade, mi­gra­tion and for­eign out­sourc­ing. To many it seems Bri­tain it­self is for sale as an in­creas­ing pro­por­tion of UK busi­nesses and as­sets an­swer to for­eign own­ers.

Eco­nomic the­ory sug­gests, there­fore, the na­tion will in­creas­ingly be run for the ben­e­fit of for­eign cap­i­tal, rather than the cit­i­zens. On top of this, there is the dan­ger that in­flows of for­eign cap­i­tal will cause the ex­change rate to ap­pre­ci­ate, mak­ing it more dif­fi­cult to ex­port, re­duc­ing man­u­fac­tur­ing out­put and re­duc­ing em­ploy­ment in those sec­tors af­fected.

To pro­tect them from forces be­yond their con­trol, cit­i­zens across the world are in­creas­ingly look­ing to the na­tion state for pro­tec­tion, hence the rise of what is of­ten called na­tion­al­ism. As Abra­ham Lin­coln noted:

“The le­git­i­mate ob­ject of govern­ment is to do for a com­mu­nity of peo­ple what­ever they need to have done, but can­not do at all, or can­not so well do, for them­selves — in their sep­a­rate, and in­di­vid­ual ca­pac­i­ties.”

It is clear, no in­di­vid­ual or com­mu­nity can stand against the forces of global cap­i­tal, and West­ern gov­ern­ments ap­pear averse to giv­ing the work­force the means to pro­tect it­self, through, for ex­am­ple, in­creas­ing em­ploy­ment rights and union­i­sa­tion. How­ever, in their search for a strong govern­ment to pro­tect them, cit­i­zens are in dan­ger of giv­ing the state too much power over their lives.

It is by no means as­sured that the poli­cies which suit a strong do­mes­tic govern­ment will be bet­ter than those which suit for­eign owned multi-na­tional cor­po­ra­tions. Also, his­tory in­di­cates the fear of global cap­i­tal may be coopted by un­scrupu­lous politi­cians into a fear of other na­tions or fear of other peo­ples. Think lo­cally Rather than na­tion­al­ism, there­fore, we might turn to lo­cal­ism. In the UK con­text, this might be de­vo­lu­tion with real (fi­nan­cial) lo­calised power, and that power re­alised through lo­cal govern­ment and lo­cal busi­ness.

An econ­omy of big busi­nesses (op­er­ated for the ben­e­fit of global own­ers) is less than ideal for the in­di­vid­ual and so­ci­ety. In con­trast, a so­ci­ety of many small lo­cal busi­nesses is more re­silient, more em­pow­er­ing and more in keep­ing with the spirit of cap­i­tal­ism and of the mar­ket. We must also bear in mind that in­creas­ing busi­ness con­cen­tra­tion (fewer, but larger firms) is a driver of in­creas­ing in­equal­ity. If a busi­ness is too big to (be al­lowed to) fail, then the govern­ment has failed in its duty to keep busi­ness small.

Eco­nomic the­ory in­di­cates that those with no stake in a com­mu­nity other than profit ex­trac­tion avoid suf­fer­ing from lo­calised ill ef­fects such as unem­ploy­ment, poverty, want and home­less­ness. It fol­lows those who live and work in a com­mu­nity have a greater stake in its pros­per­ity.

The govern­ment might like­wise con­sider how we might pre­vent those who do not even live in the coun­try from driv­ing up house prices.

Lo­cal pro­tec­tion from ex­ploita­tion by global in­ter­ests re­quires the right mix of global and lo­cal poli­cies. And lo­cal govern­ment poli­cies re­quire ad­e­quate fi­nanc­ing. By lo­cal fi­nan­cial power, I don’t mean lo­cal taxes. That has the po­ten­tial to frag­ment the na­tion, as it has, to some ex­tent, in the EU (whether per­ceived rightly or wrongly).

If we fund ed­u­ca­tion or so­cial care out of lo­cal taxes, for ex­am­ple, there will tend to be a race to the bot­tom as lo­cal au­thor­i­ties will be mo­ti­vated to un­der­per­form to en­cour­age vul­ner­a­ble fam­i­lies to go and live else­where. It fol­lows taxes should be col­lected na­tion­ally, and shared pro­por­tion­ally (on the basis of de­mo­graphic pro­file) to the de­volved au­thor­i­ties.

There is no space here to dis­cuss in de­tail other pos­si­ble lo­cal­ism poli­cies, but there are many ways to pro­mote lo­cal own­er­ship and lo­cal em­pow­er­ment. That could in­clude lo­cal cur­ren­cies, boosts to coun­cil hous­ing, lo­cal author­ity own­er­ship of util­i­ties or sup­port for lo­cally-owned high street shops. How­ever, it is not a pol­icy mix I sug­gest, rather it is an em­pha­sis.

Ul­ti­mately, the only vi­able al­ter­na­tive to the choice cur­rently on of­fer, the choice of Big State or Big Busi­ness, is Small State and Small Busi­ness, or more ap­pro­pri­ately Lo­cal Govern­ment and Lo­cal Busi­ness. To pur­sue lo­cal­ism will re­quire a sys­temic shift in how the na­tional govern­ment goes about shap­ing so­ci­ety, but I sug­gest it is pos­si­ble to pro­mote so­cial jus­tice in a cap­i­tal­ist con­text in no other way. — Africa Con­ver­sa­tion

Don­ald Trump

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