Fluent Essays

There is no required length for responses. You are assessed on your thoughtful engagement with the material. Please do not post a summary. • Your response should bring up substantive comments and questions with regard to the reading at hand and the broader themes in the class. • You may choose to relate what you read to some part of your daily life, current events, or some other situation, policy debate, etc.. • Responses can be speculative, propose applications, or pose critiques. _wolf_2016_the_tide_of_globalisation_is_turning.pdf _end_of_poverty.pdf _sachs_2005_end_of_poverty_time.pdf Unformatted Attachment Preview 3/21/2018 The tide of globalisation is turning Opinion Globalisation The tide of globalisation is turning Trade liberalisation has stalled and one can see a steady rise in protectionist measures MARTIN WOLF © James Ferguson Martin Wolf SEPTEMBER 6, 2016 Has the tide of globalisation turned? This is a vitally important question. The answer is closely connected to the state of the world economy and the west’s politics. Migration raises quite specific issues. The era of globalisation was not accompanied by a general commitment to liberalising flows of people. So I will focus here on trade and capital flows. The evidence in these areas seems quite clear. Globalisation has reached a plateau and, in some areas, is in reverse. An analysis from the Peterson Institute for International Economics argues that ratios of world trade to output have been flat since 2008, making this the longest period of such stagnation since the second world war. According to Global Trade Alert, even the volume of world trade stagnated between January 2015 and March 2016, though the world economy continued to grow. The stock of cross-border financial assets peaked at 57 per cent of global output in 2007, falling to 36 per cent by 2015. Finally, inflows of foreign direct investment have remained well below the 3.3 per cent of world output attained in 2007, though the stock continues to rise, albeit slowly, relative to output. Thus, the impetus towards further economic integration has stalled and in some respects gone into reverse. Globalisation is no longer driving world growth. If this process is indeed coming to an end, https://www.ft.com/content/87bb0eda-7364-11e6-bf48-b372cdb1043a 1/5 3/21/2018 The tide of globalisation is turning or even going into reverse, it would not be the first time since the industrial revolution, in the early 19th century. Another period of globalisation, in an era of empires, occurred in the late 19th century. The first world war ended this and the Great Depression destroyed it. A principal focus of US economic and foreign policy after 1945 was to recreate the global economy, but this time among sovereign states and guided by international economic institutions. If Donald Trump, who has embraced protectionism and denigrated global institutions, were to be elected president in November, it would be a repudiation of a central thrust of postwar US policy. Given the historical record and the current politics of trade, notably in the US, it is natural to ask whether the same could happen to the more recent era of globalisation. That requires us to understand the drivers. Part of the reason for the slowdown is that many opportunities are, if not exhausted, radically diminished. When, for example, the production of essentially all labour-intensive manufactures has moved out of the rich countries, the growth of trade in such products must fall. Similarly, when the biggest investment boom in the history of the world, that in China, slows, so too must the demand for many commodities. That will affect both their prices and their quantities. Again, the end of once-in-a-lifetime global credit boom is sure to lead to a decline in the cross-border holdings of financial assets. Finally, after decades of FDI, a host of companies with something to gain from it will have taken their opportunity and succeeded or, in important cases, failed. Yet this is not all there is to this story. Trade liberalisation has stalled and one can see a steady rise in protectionist measures. The financial crisis brought with it regulatory measures, many of which https://www.ft.com/content/87bb0eda-7364-11e6-bf48-b372cdb1043a 2/5 3/21/2018 The tide of globalisation is turning are bound to slow cross-border financial flows. The rise of xenophobic sentiment and the slowdown in trade are both likely to reduce the growth of FDI. In brief, policy is less supportive. The politics are becoming even less so. Again, the US is the central part of the story. Mr Trump is much the most protectionist candidate for US president since the 1930s. But, revealingly, Hillary Clinton, an architect of the US “pivot to Asia” has turned against the Trans-Pacific Partnership of which she was once a keen supporter. The Transatlantic Trade and Investment Partnership, being negotiated between the US and the EU, is now in deep trouble. TheDoha round of multilateral trade negotiations is moribund. Above all, important segments of the western public no longer believe increased trade benefits them. Evidence on relative real incomes and adjustment to rising imports provides some support for such scepticism. Globalisation has at best stalled. Could it even go into reverse? Yes. It requires peace among the great powers. Some would also argue it requires a hegemonic power: the UK before 1914 and the US after 1945. At a time of poor economic performance in leading high-income countries, rising inequality and big shifts in the balance of global power, another collapse must be a possibility. Consider the impact of any fighting between the US and China over the South China Sea, though such a calamity would be terrifying for far more than its narrow economic effects. https://www.ft.com/content/87bb0eda-7364-11e6-bf48-b372cdb1043a 3/5 3/21/2018 The tide of globalisation is turning Does globalisation’s stalling matter? Yes. The era of globalisation has seen the first fall in global inequality of household incomes since the early 19th century. Between 1980 and 2015, average global real income rose by 120 per cent. The opportunities afforded by globalisation are vital. Our future cannot lie in closing ourselves off from one another. The failure — a profound one — lies in not ensuring that gains were more equally shared, notably within high-income economies. Equally dismal was the failure to cushion those adversely affected. But we cannot stop economic change. Moreover, the impact on jobs and wages of rising productivity and new technologies has far exceeded that of rising imports. Globalisation must not be made a scapegoat for all our ills. Yet it has now stalled, as have the policies driving it. It might reverse. Yet even a stalling would slow economic progress and reduce opportunities for the world’s poor. Pushing globalisation forward requires different domestic and external policies from those of the past. Globalisation’s future depends on better management. Will that happen? Alas, I am not optimistic. martin.wolf@ft.com Letter in response to this column: Time to take our fingers out of our ears on trade / From Richard Stead Copyright The Financial Times Limited 2018. All rights reserved. Promoted Content https://www.ft.com/content/87bb0eda-7364-11e6-bf48-b372cdb1043a 4/5 3/21/2018 https://www.ft.com/content/87bb0eda-7364-11e6-bf48-b372cdb1043a The tide of globalisation is turning 5/5 GLOBAL STUDIES 130 Global Economy and Development Lecture 2: The End of Poverty? Course Overview January 9, 2020 Jia-Ching Chen, PhD Whither globalization? … and development ... of What? Where? When? For Whom? • What is “development”? • … a global political-economic project • … the interplay between globalization of economic activity and the politics of Development • … the uneven social & environmental effects of economic activity and change • … inequality and poverty • … power and politics (across geopolitical, institutional & cultural domains) 2 The Global Economy is Slowing Down https://www.marketwatch.com/story/oecd-says-global-economy-will-grow-at-worst-pace-since-financial-crisis-2019-09-19 3 The Global Economy is Slowing Down https://www.marketwatch.com/story/imf-sees-global-economic-growth-falling-to-3-this-year-slowest-pace-since2008-financial-crisis-2019-10-15?siteid=bullytweet 4 https://www.ft.com/content/1b1e0070-709b11e9-bf5c-6eeb837566c5 5 Bloomberg via: https://www.fsinvestments.com/perspectives/articles/economicoutlook-q2-2019-global-interest-rates-weigh-on-us-yields 6 US Federal Debt Skyrocketing: Total Public Debt as Percent of Gross Domestic Product Source: Federal Reserve Economic Research FED Bank of St. Louis https://fred.stlouisfed.org/series/GFDEGDQ188S 7 Total Global Debt Skyrocketing Source: Institute of International Finance; Chart: Axios Visuals https://www.axios.com/global-debt-increase-q1-2019-92ef0a63-b86e-471d-84c8-588a719f3fc2.html 8 Total Global Debt Skyrocketing: For What? Source: World Bank. World Development Indicators Data. https://en.wikipedia.org/wiki/Capital_formation#/media/File:IQuoteWeltEngl.PNG 9 Total Global Debt Skyrocketing: For What? https://www.cnbc.com/2019/12/24/global-stock-markets-gained-17-trillion-in-value-in-2019.html 10 10 USAID announced in 2016 that extreme poverty had been reduced by 50\% over 30 years https://blogs.worldbank.org/opendata/files/opendata/poverty-target.png 11 Relative Growth and Development The Elephant, The Champagne Glass & The Hockey Stick Income Growth Source: Jamaldeen (2016) “What’s happening on Global Inequality? …” https://oxfamblogs.org/fp2p/whats-happening-on-global-inequality-putting-the-elephant-graph-to-sleep-with-a-hockey-stick/ Data from Lakner and Milanovic (2013) https://openknowledge.worldbank.org/handle/10986/16935 12 Relative Growth and Development The Elephant, The Champagne Glass & The Hockey Stick 2015: richest 1\% own more than the rest of the global population. 2015: 62 people own more than the poorer half. à 2016: 8 wealthiest had more than the poorer half In 2008: 1.4 Billion Source: Ortiz and Cummin (UNICEF, 2011). 2012: 35\% (over 2.1 billion people) lived on < $3.10 = 8.8\% of total wealth 13 Relative Growth and Development The Elephant, The Champagne Glass & The Hockey Stick Income Growth Growth Relative to 1988 Average Source: Jamaldeen (2016) “What’s happening on Global Inequality? …” https://oxfamblogs.org/fp2p/whats-happening-on-global-inequality-putting-the-elephant-graph-to-sleep-with-a-hockey-stick/ 14 The End of Poverty? Millennium Development Goals • In 2000, the 191 countries of the UN agreed to eradicate extreme poverty by 2015 • 2015 MDG Report claimed a 58\% reduction 1990-2011 • Continuation of poverty eradication under the 2016 UN Sustainable Development Goals for 2030 • The Eight Millennium Development Goals are: • • • • • • • • to eradicate extreme poverty and hunger; to achieve universal primary education; to promote gender equality and empower women; to reduce child mortality; to improve maternal health; to combat HIV/AIDS, malaria, and other diseases; to ensure environmental sustainability; and to develop a global partnership for development. 15 The End of Poverty? Drawing the poverty line • Extreme poverty is defined by the World Bank, UN and development institutions as the bare minimum consumption level of the world’s poorest people • 1990 World Bank defined this as $1 per day • Using Purchasing Power Parity rates by the International Comparison Program to reflect real well-being in different countries • 1993: $1.08; 2008: $1.25; 2015: $1.90 • Adjusted for inflation—so that the amount purchased in 1990 for $1 ≈ $1.90 in 2015 16 The End of Poverty? Drawing the poverty line • Arbitrary line— $1.25 per day? $1.90? $2.28? • A global definition ignores regional and subnational inequality • Ignores poverty in places like the US • Agriculture Department Thrifty Food Plan 2011 cost of minimum nutrition in the US: $5.04 per day • Housing? Clothing? Transportation? Education? 17 The End of Poverty? Walking the poverty line • Sachs’ (2005) “Big Push”: seeks to address “market failures” through massive state interventions • Sachs revives Rostow’s (1960) Modernization Theory in the The Stages of Economic Growth: A Non-Communist Manifesto, arguing for infrastructure investments that can pull countries out of the “poverty trap” • Easterly (2006) rejects “modernization” as “Big Western Plans” that fail and have devastating unintended consequences. The argues for “Searchers” over “Planners” 18 The End of Poverty? China ‘graduated’ from the IDA in 1999 https://blogs.worldbank.org/opendata/chart-two-decades-progress-worlds-poorest-countries 19 European Pressphoto Agency https://www.scmp.com/news/china/economy/article/2132969/mafter-four-decades-its-end-line-iconic-guangzhou-railway-station Growth of foreign direct investment compared with exports for 60 years Source: Dicken (2015), calculated from UNCTAD World Investment Report 21 Developing countries’ increasing shares of production, trade and foreign direct investment Source: Dicken (2015) Figure 2.9. Calculated from World Bank and UNCTAD data 22 The resurgence of China China has the largest share of global merchandise exports Source: Dicken (2015), based on data in Subramaniam and Kessler (2013: Table 2.2) 23 The resurgence of China China has the highest annual GDP growth rate Source: Dicken (2015) Figure 2.10, calculated from UNCTAD, 2013b: Table 1.1 24 The resurgence of China China’s massive exports of manufactured goods & Imports of raw materials Source: Dicken (2015), data from WTO (2012: Table A22) 25 The resurgence of China 13000000.0 {100 persons} [kt CO2] {Population} 12000000.0# (\%) 60.0# (Urbanization Rate) 10000000.0# 50.0# 8000000.0# 40.0# 6000000.0# 30.0# 4000000.0# 20.0# [Carbon Emissions] 2000000.0# 0.0# 10.0# # # # # # # # # # # # # # # # # # # # # # # # # # # # # 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 20 20 20 20 20 20 20 20 Jia-Ching Chen (2015) 0.0# 26 The resurgence of China … is underwritten by structural inequality. The “floating population” enabled manufacturing expansion and the underdevelopment in the rural places workers came from. http://www.joeydevilla.com/wordpress/wp-content/uploads/2008/02/guangzhou_train_station_large.jpg 27 The resurgence of China … is underwritten by structural inequality. Rural land dispossession enables the state to redistribute resources of land and capital to private enterprises. Jia-Ching Chen (2010) A village in Jiangsu province where land was taken for the solar PV and other industries 28 European Pressphoto Agency https://www.scmp.com/news/china/economy/article/2132969/mafter-four-decades-its-end-line-iconic-guangzhou-railway-station
  
         T O R T U R E D D R E A M S Children with no home other than this sleep in a train station in Jakarta, Indonesia Photographs by James Nachtwey
VII ple are so poor, their lives are in danger. How to change that for good E X C L U S I V E B O O K E X C E R P T We can banish extreme poverty in our genera because they are too poor to survive. The trag thrive. In a bold new book, Jeffrey D. Sachs I t is still midmorning in malawi when we




 


         

 
    
 
 
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   T H E D I R T I E S T W O R K Women in Bihar, one of Indias poorest states, carry away the contents of latrines. Only members of the untouchable caste perform that low-paying task tionyet 8 million people die each year edy is that with a little help, they could even shows how we can make it happen COPYRIGHT
2005 JEFFREY SACHS. ADAPTED FROM THE END OF POVERTY, TO BE PUBLISHED THIS MONTH IN THE U.S. BY PENGUIN E X C L U S I V E B O O K E X C E R P T the young girls her name and age. She looks about 7 or 8 but is actually 12, stunted from years of undernutrition. When I ask her what her dreams are for her own life, she says that she wants to be a teacher and that she is prepared to study and work hard to achieve that. I know that her chances of surviving to go on to secondary school and a teachers college are slim under the circumstances. The plight of Malawi has been rightly described by Carol Bellamy, head of
 as the perfect storm of human deprivation, one that brings together climatic disaster, impoverishment, the  pandemic and the long-standing burdens of malaria, schistosomiasis and other diseases. In the face of this horric maelstrom, the world community has so far displayed a fair bit of hand-wringing and even some high-minded rhetoric, but precious little action. It is no good to lecture the dying that they should have done better with their lot in life. Rather it is our task to help them onto the ladder of development, to give them at least a foothold on the bottom rung, from which they can then proceed to climb on their own. This is a story about ending poverty in our time. It is not a forecast. I am not predicting what will happen, only explaining what can happen. Currently, more than 8 million people around the world die each year because they are too poor to stay alive. Every morning our newspapers could report, ;More than 20,000 people perished yesterday of extreme poverty.< How? The poor die in hospital wards that lack drugs, in villages that lack antimalarial bed nets, in houses that lack safe drinking water. They die namelessly, without public comment. Sadly, such stories rarely get written. Since Sept. 11, 2001, the U.S. has launched a war on terrorism, but it has neglected the deeper causes of global instability. The nearly $500 billion that the U.S. will spend this year on the military will never buy lasting peace if the U.S. continues to spend only one-thi ... Purchase answer to see full attachment