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Monday
Jun272016

Don't Throw the Baby Out with the Bathwater

The world is beset by problems: Unmanageable government debt and massive unemployment in several European countries, drought and famine in Africa, religious and territorial wars in the Middle East, the Zika virus, drug violence and extreme poverty in Central and South America, large-scale migration from Africa and the Middle East into Europe, nuclear threats from rogue states such as North Korea, terrorist attacks throughout the world, and gross economic disparity between classes within most countries and between countries and regions of the world. The average person in most countries is aware of these problems because they are part of each day’s news, carried on the Internet. We live in a highly connected world.

Our world is not only connected by information, most of the companies that have become familiar names to us are global companies: IBM, Berkshire Hathaway, J.P. Morgan Chase, Wells Fargo, Apple, MacDonald’s, Starbucks, Toyota, Facebook. The very largest are Chinese banks. Some of these companies are not familiar to the average citizen, despite their sizes and influence. Deutsche Boerse, for instance, #699 on the Forbes list, is a German financial transactions company that is large enough to have offered to merge with the New York Stock Exchange, but the transaction was blocked by the EU, fearing a monopoly (although the U.S. government was willing to allow it), and now is negotiating a merger with the London Stock Exchange. Within Forbes’ top 2000 global companies, the United States, with 579, far exceeds any other single country, although in terms of regions, Asia leads all others, North America is second and Europe is third. The largest global industry is banking, making up more than one fifth of Forbes’ top 2000 companies.

One of the most obvious effects of global connectivity can be seen in the relocation of much of the world’s manufacturing from developed Western countries to developing Asian countries. Ownership of a multinational company may reside in the U.S. or Europe, but its manufacturing operations are often located in parts of the world where labor is cheapest. As a result, the stagnating middle class in the West is matched by a rising middle class in many Asian countries. The increase in the wealth of ownership tends to further income inequality, while the rise of production tends to lessen it.

Wars are also global affairs, even little ones. We haven’t experienced World War III yet, but America’s involvement in Bosnia, Afghanistan, Iraq, Libya and Syria has been accompanied by international coalitions, sometimes involving NATO and sometimes smaller groups of like-minded countries. Iran, Saudi Arabia and the U.S. are all involved in the civil war in tiny Yemen.

Many people, although a tiny percentage of the world’s population, are making fortunes in this connected world. Most of the rest of the world is suffering, either as victims of war, as refugees, as stagnant wage earners or as part of the unemployed. This disparity in financial outcomes, as well as anger about decisions, such as allowing too many immigrants to flow into Europe, the UK and America, has led to massive public dissatisfaction and, at the voting place, a revolt on both sides of the Atlantic, while it is one of the factors that has fueled violent rebellions in the Middle East.

Two massive reactions to the ill effects of globalization have been a resurgence of strident nationalism, mostly spurred by fears about uncontrolled immigration leading to a change in the national character of many countries, and widespread distrust and disgust with existing governmental structures that are blamed for allowing and even furthering such evils. Both of these reactions are based upon genuine issues.

The number of immigrants, globally, has been increasing worldwide over the last three decades, with most of the increase being from South to North. While immigration slowed during the worldwide recession, it has doubled in numbers of new immigrants since 2013, due to the Middle Eastern conflicts and African drought. In many European countries, as well as the UK and the United States, immigration accounts for higher percentage of population growth than does in-country birth rate. Cultural, ethnic and language changes accompany such demographic changes. This is disturbing to many, who feel as if their countries are being “invaded” by immigrants.

Contrary to the view put forth by conservatives, the failure of government to control increasing income disparity and dwindling resources among the middle class has not been due to the increasing size of governments and excessive government regulation, but to what are usually referred to as “neo-liberal” policies in which less regulation of business and finance, unfettered growth of private capital, near-monopolistic business practices, and heavy interweaving of private industry and government through appointments, policies, and campaign contributions, have led to systems in which the welfare of common citizens is expected to be taken care of by the success of private enterprise. This has failed to happen. Also contrary to conservative rhetoric, the amount of government regulation is less in the U.S. than in Europe, income disparity is greater in the U.S. than in Western European countries, and government services are fewer and more meager. Those developed countries with the least income inequality, as well as the least government debt are those Scandinavian countries with the most government services and regulations.

The control of governmental policies and economic outcomes by the private sector and the growth of a globally connected private economic sector has taken the control of government out of the hands of many countries’ own citizens. It is this feeling of powerlessness that has fueled the Brexit movement in the UK (that, and the desire to reduce immigration) and fuels both the Trump and Sanders candidacies in the U.S. However, many of those who support Brexit or Trump do not see it this way. They view the villain as big government and excessive regulation, making decisions and forcing outcomes that are detrimental to themselves. The Sanders supporters have a clearer picture of the real culprit, and they sought to change the situation by increasing the regulations on business, by increasing government services and by removing the influence of wealth from campaign financing.

Now that Bernie Sanders has lost in the United States and Britain has left the EU, we’re left with disenchantment with government by many in the U.S. (support for third party candidates or refusal to vote for anyone are expected to hit record numbers in the U.S. Presidential election), and absence of EU regulation, economic sharing, and open borders in the UK.

By turning their backs on flawed or dysfunctional government systems, rather than trying to fix them, citizens are further turning the reins of control of their lives over to the wolves. The world is globally connected. Immigrants will continue to be displaced by wars that are supported by world powers such as the U.S., Russia, China, France and the UK which are more concerned with preserving access to resources and influence than with humanitarian outcomes. Catastrophic weather conditions, such as droughts and floods will increase as the planet continues to warm unless all the countries in the world can agree to take measures to stop climate change. The largest corporations in the world will continue to grow, to merge, and to control governmental decision making, so long as the political arena provides no competitor to their influence and no credible government regulations to deter them.

What is needed are individuals in positions of influence in government, in industry, and in communities who will challenge the current power structure. What is needed are new organizations that can harness public support for using democratically elected governments to make the welfare of individual citizens a greater priority than the profits of large businesses. What is needed is a political movement that is itself connected and powerful using the same tools that now serve only the mega-corporations and the wealthy. This means not turning our backs on politics or being satisfied with simply protesting (although nonviolent protests are a powerful vehicle for engaging public support), but enlisting our best and our brightest minds with the task of creating a system that changes so that it works as it was intended to work, not as it is currently designed to work. The tools are available. The global information network is one that is difficult for even those most dedicated to bias and censorship to control. It is a strong tool for influencing people’s minds. But to do so, we must be engaged with the system, not give up on it. 

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