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The world is bumpy

The main threat to globalisation today comes from the rich and powerful States losing their nerve and their belief in markets, writes Chris Patten.

india Updated: Nov 05, 2007 23:24 IST

In one sense, the globalisation that is transforming our world today is nothing more than the recent movement of people, ideas and technologies, taking advantage of a new era (politically and economically), of relatively easy travel, easy communication and open opportunities for education, self-betterment and self-aggrandisement.

Globalisation is ultimately about choices exercised at a global level: economic, lifestyle and identity (particularly in relation to terrorism). The real dividing line between those for and against the broader globalisation project has less to do with Right and Left than it does with a particular stance on the wisdom of leaving as many choices as possible to individuals.

What defines the anti-globalisation radicals is a lack of faith in human beings. The movement of people from one country to another will apparently destroy national cohesion and integrity. Individuals will be ground down along with their local identity by an impersonal global capitalist machine. Consumer choice will be distorted by and subjugated to the marketing of brands. The ‘comparative advantage’ of poverty, in India for example, to the export of jobs from rich countries, destituting white collar as well as blue collar workers. Globalisation is something ‘out there’, a pitiless, inexorable process, or else a shadowy, threatening conspiracy.

There are two ‘isms’ that we need to watch carefully even as we try to mould a better and more inclusive globalisation. The first of these is technological determinism. Thomas Friedman has been accused of arguing that technological developments ensure that the only route to success lies in being more like the US. His argument has been that until 1800, economic competition pitted country against country; that in the subsequent two centuries technology set company against company; and that since then information technology, in particular, has empowered individuals to compete and to collaborate, especially non-White men and women principally in Asia and — perhaps pre-eminently — in India. This has gone so far that these days large numbers of American workers, for example, outsource the preparation of their tax returns to workers in India. Outsourcing and insourcing, Netscape and browsers, Google and Yahoo, Bill Gates and Nandan Nilekani, are the heroes of this Whiggish view of onward and upward progress.

Like Friedman, I have visited the Infosys campus just outside Bangalore. It is impressive: brand new buildings like an Ivy League campus and 14,000 young Indian software engineers. For Europeans worried about competition from Polish plumbers, I have to say that this looked like the Real McCoy. But it did not convince me that the world is flat. Nor do I think Mr Nilekani would take this view. Driving to the Infosys campus, there are all too many examples of how uneven the world is even in a booming and often shining India, with too much poverty on view. Moreover, the road to the Infosys campus is anything but flat.

Friedman rightly argues that technology today can liberate and connect individuals to an unparalleled degree. But we should not exaggerate the impact of the internet, air travel and container ships with comparison to the technological developments in the last century; nor should we forget that most people don’t live in a cyberworld.

The second ‘ism’ to reject is anti-Americanism. While the US itself is the product of a long process of globalisation, the recent expansion of global society has less to do with the expansion of American society than it does with a distinctive US contribution to the structure of world affairs. The US has been a powerful enabling factor in globalisation, rather than its sole driving force. But it did more than anyone else to frame the rules and form the institutions that shaped the global economy in the last half century, aiming for a global emporium not a global imperium. Just as the US advocated capitalism and, usually, free trade, it also used its military might to support a system of world security that was not so much the extension of the US control as it was the extension of a zone within which the US denied control to any other potential contender. This occasionally led to terrible errors: overlooking lessons of history; judging some security issues in terms of whether or not a country fitted into the US’s zone or into a potential contender’s; forgetting that other people had their national pride and national interests too. Sometimes a single bilateral relationship, like that with Iran, was wrecked by all three of these mistakes.

A world in which the US is the only superpower, a world whose principal economic dynamism has reflected the American way of doing things and running businesses, is not an American empire to be hated and fought. You can criticise American policies or attitudes, as I do myself, without believing that the US is the Great Satan. To be hostile to the US is very often to be hostile to the decisions that the rest of us make — the decision as taxpayers not to spend as much as we should on our own security, the decision to buy this or that product or to run our affairs in this or that way.

The main threat to globalisation today comes from the rich and powerful States losing their nerve and their belief in markets, and failing to make the corrections in the system that would benefit all. A defence of economic globalisation does not require an ideological refusal to accept any criticism of it. Nor should we feel any necessity to defend in the last ditch the global institutions which at present manage the process: the World Bank, the World Trade Organisation and the International Monetary Fund. Much as it grieves me to say this, Mr Mahathir appears to have been more correct about many aspects of dealing with the Asian financial crash than the IMF for all its claims of infallibility. High-handedness reigned on both sides of this debate but when the Malaysian Prime Minister asked, “Why not leave us to do the wrong things we want to do?” he turned out to be dead right.

Modern global governance in economic — and indeed in other affairs — cannot be a project driven by a single State. Even if the US had the will to provide the leadership — and the swelling protectionist tide there raises doubts about this — it would have to operate as the biggest but not the only kid on the block. It has to recognise that we will not solve any of the major economic or other problems in the world without the cooperation and shared leadership of India and China.

Interdependence does not end the autonomy of States. What holds the system together is not the weakness of States but the choice that many States have made to stick together. Self-interest should be the glue that binds globalisation in economic and other matters. This constitutes both the greatest strength and the greatest potential weakness of the global environment, that it is held together by many choices made in beneficial concert.

Chris Patten was the Governor of Hong Kong and European Commissioner for Foreign Relations.
This is an edited extract of the 6th Madhavrao Scindia Memorial Lecture delivered on November 1.