I was astounded by the intellectual honesty of this book. Ian Bremmer is a credible globalist who worked his way up in life to the pinnacle of success as a Ph.D. and business owner, after having been born to a single mom in a working-class suburb of Boston. He has “street cred” as a man who has one foot in America’s working class, and one foot in its meritocracy “elitist” class. He’s very obviously never forgotten where he’s come from, or where’s he’s going.
He comes across as an open-minded economist who seeks to make a case for preserving globalism by honestly weighing its benefits vs. its costs. He does not deny that many big business executives and politicians have underestimated the costs of globalization. Nor does he deny that many people are justifiably angry about their misrepresentations. He nevertheless believes that globalism represents the best path forward for humanity and seeks to show that its benefits outweigh its costs. Whether you’re a Populist or a Globalist, you can be sure that your views will receive a fair hearing.
For me, the most interesting aspects of the book are the inherent contradictions of globalism. Even such an honest and comprehensive analyst as Dr. Bremmer does not resolve them. On the one hand, he says:
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Advances in automation and artificial intelligence are remaking the workplace for the benefit of efficiency, making the companies that use them more profitable, but workers who lose their jobs and can’t be retrained for new ones won’t share in the gains. Technological change then disrupts the ways in which globalization creates opportunity and shifts wealth. As a result, large numbers of U.S. factory jobs have been lost not to Chinese or Mexican factory workers but to robots. A 2015 study conducted by Ball State University found that automation and related factors, not trade, accounted for 88 percent of lost U.S. manufacturing jobs between 2006 and 2013.8
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Then he says:
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Globalization creates new economic efficiency by moving production and supply chains to parts of the world where resources— raw materials and workers— are cheapest…. In the developed world, this process bolsters the purchasing power of everyday consumers by putting affordable products on store shelves, but it also disrupts lives by killing livelihoods as corporations gain access to workers in poorer countries who will work for lower wages.
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So, which is it? Are all these millions of jobs being lost because of automation not related to trade, or are they being lost because companies are firing their higher-paid American and European moving the work to the cheapest labor countries?
In my view, it is that companies are moving the work to cheap-labor countries to AVOID having to invest in technologies to keep their American and European workers productive. It’s cheaper to replace 1,000 Americans earning $25 / hour with 1,000 Mexicans and Chinese earning $2 / hour than it is to invest $20,000,000 in making the American workers earning $25 / hour more productive.
Furthermore, it is difficult to produce a product in the USA where the average wage is $25 / hour and sell it in Mexico or China, where the average wage is $2 / hour. Those $2 / hour Mexicans and Chinese don’t earn enough money to afford the product. So what’s an American company going to do? They’re going to fire their American employees, move the work to Mexico and China, and produce it with $2 / hour labor. They’re going to sell part of the production locally, and then import the rest into the USA. They are going to inflate their profit margins on the USA sales by arbitraging the $2 / hour labor cost in Mexico and China with an American price list.
But don’t Americans benefit by getting products cheaper? Not necessarily. Dr. Bremmer points out that Americans would rather have jobs that allow them to afford SOME products, even if they are relatively expensive, than to be unemployed and unable to afford any products, even if they are relative cheap. Nor, is there really any indication that foreign-made products are cheaper. We’ve been told that “If Iphones were made in the USA they’d cost $700 and no American would buy them.” Iphones ARE made in China, and they DO cost $700, and Americans still buy them. The winner is Apple, which pockets the difference between cheap Chinese labor costs and Americans’ ability to pay $700 for an Iphone. I am happy with Apple products and own the stock, so I am not picking on Apple. Just saying that there is no reason why it can’t make Iphones in the USA, and put Americans to work instead of Chinese.
And then Bremmer addresses the question of immigration:
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…“We can see that Trump’s biggest enthusiasts within the party are Republicans who hold the most anti-immigration and anti-Muslim views, demonstrate the most racial resentment, and are most likely to view Social Security and Medicare as important.”
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But why do we need copious immigration if it is true that technology is destroying so many existing jobs? Why bring more people into the country to fill jobs that don’t exist?
My view is that our borders are intentionally left open to illegal immigration because: A) Big business wants them here to beat down wages, and B) Liberals want them in here to dilute the legacy, conservative-voting population and create more Liberal voters. And, let me say that I am a business owner who is married into an all-immigrant Hispanic family. My wife, a naturalized U.S. citizen voted for Mitt Romney in 2012 and Trump in 2016. I voted for Obama in 2012 and Trump in 2016. Dr. Bremmer describes the motivations of white folks like me, with industrial traditions in the Midwest, who switched from Obama to Trump.
Dr. Bremmer leaves many questions unanswered. His view is that unrestricted free trade with all countries is good, because….free trade with all countries is good; open borders to allow copious legal / illegal immigration into a country is good, because….copious immigration is good.” These are tautologies, of course, that are taken as matters of faith, and not necessarily of evidence.
He also covers the need to remediate the ill effects of globalization, but admits that “these benefits are easier to promise before deals are approved than to deliver after they’re signed and politicians no longer need to keep their word.”
My conception of Globalism is that it is an organization of big business / big government crony capitalists, supported by liberals in the media and academia, who seek to supplant national democracies with unelected supra-national bureaucracies unaccountable to the people of any nation.
“You don’t like our shipping your jobs overseas. Well, that’s too bad. The World Trade Organization says there’s nothing we can do about it.”
“You don’t like our opening our borders to hordes of illegal foreign immigration. Well, too bad, the World Court says we have to allow it.”
The objectives of big business crony capitalists are to replace the high-wage labor in the developed countries with cheap foreign workers. The objectives of Liberal politicians are to replace the legacy populations of each developed countries with Third World people who are prone to being manipulated to socialist agendas.
If that’s your view, you will enjoy this book. If your view aligns with Dr. Bremmer’s that globalism must be maintained with all its warts, you will enjoy his view. My opinion about globalization has not changed after reading the book, but I am in the process of considering Dr. Bremmer’s points. My thinking may be matured as I reflect on his views, or perhaps it will not be changed. But I WILL reflect on Dr. Bremmer’s views, as I reread portions of the book.
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