With the advent of right wing nationalism on the political front and anti-globalization/protectionism in the economic sphere, the international community looks poised to change forever. Several events in 2016-17 has made the foundation of globalization which once seemed invincible, look fallible. The shocking events of Brexit, Trump's presidential win, and several protectionist measures being introduced by the EU countries has made inward looking policy which once seemed a thing of the past, a thing of the very present.
After the WW2 came to an end, the legacy of the failed League of Nations was meant to be carried forward by the United Nations. Since then the rise of international organisations has been exponential. By making the countries economically interdependant, the fallacies of the two world wars and the destruction that followed, was meant to be mitigated. The era of 1980s to 2000s, was seen as the golden era for globalization. The collapse of the USSR, saw the communist regime fall prey to the capitalist one. The establishment of WTO was the last straw in the quest for the spread of capitalism. Requiring countries to lower trade tarrifs, facilitate the import and export of trade and services, it gave an open door policy to capitalism to make its headaway into countries which were prior untouched by it. Two decades or so after, the very institution which arguably is the West's brainchild, looks set to crumble.
The world seems to have had a full circle now, especially for India. Getting independant in 1947 with very little industrializationon its hands, India was bound to introduce protectionist measures, and rightly so. The subsequent failing of the 1-4 FYP however, coupled with the lacklustre performance of the Mahalanobis plan, rendered it quite diificult for Indian industries to deliever results. Also, the well known factors such as excessive role of the state in the economy curbed the autonomy of the firms thereby affecting them in the long term. The blame was not entirely on the government, albeit majority of it was. The firms with little competition and an assured market, brought in a complacency and a laid back attitude which made them never fully equipped to face the foreign competition. As India gradually started to open up its economy in the 1980s, contrary to the popular belief that it just spontaneously happened in 1991, globalization was born, Three decades later, the crux of the development of the economy lies in globalization. One might rightly argue that the IMF and the World Bank while laying out certain conditions while granting loans in the backdrop of the BOP crisis in 1991, are also somewhat responsibe for the globalization in the country. Also, being a founder member of the world bank put India right on the world map in its stand on free trade. Relaxing FDI norms, especially in the current so called pro-business NDA government, has been the call of the hour. A formidable increase in job generation, industrial production, foreign exchange reserves, FDI and FPI has made India reap the benefits of globalization in the best way possible. With the USA now introducing protectionst measures and laying curbs on firms moving abroad, the same country's institutions which made India open up its economy, completes the full ironical circle I mentioned earlier.
From lassiez-faire economics propogated by Adam Smith, to the Keynesian economics advocated by John Maynard Keynes, welfare state has been the accepted norm almost everywhere across the world. The free hand of the market, as now realized cannot alone allocate resources in the different spheres in the economy. The birth of a mixed economy meant to mitigate the side effects of the ever expanding globaization, has been somewhat successful. In the backdrop of these side effects, the sentiment of anti globalization came about. Ever since the 2008 sub prime crisis gripped the world, the aftermath still haunts the global community. Low generation of jobs, sluggish international growth fuelled with the apparent "stealing" of jobs by immigrants in developed countries, took its manifestation in the biggest event in the 21st century, i.e Brexit. The natural reaction of closing down the doors of economy, is nothing but flawed and let me tell you why.
The measure of closing down the economy seems very attractive in the short run but is very flawed in the long term. Closing down the economy in this day and age never takes place in a direct way. A look at the recent Trump measures that he might introduce in the future, cutting down taxes for companies setting up the base in the home country and increasing the same for those moving out, might seem appealing. However, essentially what the Trump administration is giving the industrialists/businessmen is an assured market, an assured employee pool and lacklustre competition. The result; lower real wages for the empoyees, and possible increase in the prices of products. Not to mention, the retaliation measures enacted by the other countries in response to their trade being hurt which is in no way fruitful for the US. Given the wide influence that the US economy weilds, there is likely to be large capital outflows on the sentiment of stagnant economic integration. The rise of world leaders elected on the basis of populist measures combined with anti-globalization is a very deadly disease, that promises to plague everyone in its path.
So what is the supposed answer then? I stumbled upon a very interesting ted talk by a certain Sir Ken Robinson recorded way back in 2006, titled "Are schools kiiling our creativity?" In reference to the talk, I feel that the answer is innovation. As mentioned in the talk, public education systems everywhere were created during the boom of industrial revolution. So the essential goal of education then was to create factory workers. Since then, there has been no substantial change in the education policy of most of the countries. Teaching students mechanical and static subjects without an emphasis on the real world situations and virtually no real lessons on adaptation in this ever changing world has made it strikingly unprepared. Take this for instance, people graduating out of college today in 2017 would be retiring in the deacde of 2070s. Here we are without even a slightest clue as to what might happen in the next 5 years. Yet we are meant to educate people for it. The heirarchial structure of say maths, science having an advantage over humanities/arts/music/dance has exacerbated the effects of an inefficient education system. From the very childhood, children are told to sidestep their hobbies and take the conventional route to going ahead in life, i.e to settle for a 9-5 job. The education inflation is a testament to this, whereby to get a job earlier one had to be graduate, now it is post graduate, Phd and so on. Their hobbies are encouraged but never banked upon to take them ahead in life, and they are quite often stigmatised for it. As the talk suggested and I agree with it 100%, as a child we were never afraid to be wrong, but as we grow up the fear of it kicks in and we start to loose our creative side. Now obviously, being wrong isnt the same as being creative, but having the courage to accept that in the pursuit of being creative or being innovative, failure is natural, goes a long way in giving us the creative edge that we so lack these days.
This all sounds rosy, but how is this linked to anti-globalization? People living the 20th century or as recently as three decades ago would never have imagined the IT boom that we have today which is rightly being termed as the new industrial revolution. Social media networks, e-commerce has completely catapulated the the IT industry, and the potential of it is still not fully tapped. Similar transformation is being seen in the other sectors as well. We should start accepting people's creative capacities for what they are rather than confining them to a 9-5 job. If somone had told Mark Zuckerberg or Jeff Bezos or Steve Jobs to avoid taking risks, the world might have been a very different place. This is very true in case of India as the conevntional route is very often taken reluctantly and the huge potential of the child larrgely remains behind curtains. There is a need of a paradigm shift into the way we view people's capacities and the manner in which we develop them. On the economic front, there is very little we can do. Sluggish growth and prosperity is the law of the economic land, it is inevitable. What we can do though, is to better prepare people for the future, by capacity building and making the route less taken banal again. With the largest and vibrant youth demograohic in the world, India is on the cusp of restoring its former glory, let us not fall short in our duties to make it happen.
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