globalizationThere is a clear divide among Debating Europe commenters between those of you that support globalization as a wealth-creating march toward utopia and those that oppose it as an environment-munching descent into neo-feudalism. That’s an over-simplification, and the views on display are (usually) more nuanced, but whether we are discussing immigration, free trade or banking, the division in the comments is there.

Yesterday, we discussed questions of trade, industry and protectionism in Europe. One of our commenters from Italy, Vicente, had suggested that the EU should do more to protect its remaining industries from competition overseas, particularly when labour and environmental standards were lower. In response, Paul made an excellent point:

I do not see how tougher protectionism will boost exports? […] If you place tariffs on goods from outside the EU then the external countries will do the same and exports will suffer. I keep hearing that the EU wants to be a global player. Quite how such an inward-looking strategy fits with that ideal, I do not know

This is also the standard response from most mainstream economists, and the orthodox view is that increased protectionism in the 1930s was one of the contributing factors to the Great Depression. However, some of our commenters argue that free trade and competition with the rest of the world could, nonetheless, be better moderated and balanced. Guisan, for example, sent us the following comment:

citizen_icon_180x180Europe needs more balanced trade with the rest of the world, and EU policies should be changed in order to avoid high trade deficits and a negative current account balance. More fair trade is not the same as more free trade. Fair trade does not destroy industry, nor generate unsustainable trade deficits. The European Union should improve its policies in this regard.

To get a reaction, we took Guisan’s comment to David Martin, a Scottish Labour MEP with the centre-left  Social Democrats, and a prominent member of the European Parliament’s Committee on International Trade. How would he respond?
We have also had some commenters argue that globalization is exploitative of developing countries, and Europe should therefore refuse to import products that are produced in countries with poor labour standards. Theodoros, for example, sent us in the following:

citizen_icon_180x180Europe is obliged… to make sure that [products from] child workforces, or slave-labour workforces, or underpaid workforces are never again seen in EU markets from states like Vietnam, China or India. It is our duty to take all the appropriate anti-dumping measure for the sake of humanitarianism.

There are an estimated 250 million child workers between the age of 5 and 14 globally, and 61% of these are found in Asia. The vast majority of child workers, however, are employed by their own families on rural farms, and the EU continues to maintain high tariffs (not to mention subsidies) in agriculture. Would protectionist measures really be effective in preventing child labour? And, as for lower wages in developing countries, does this really justify the use of anti-dumping measures? What did David Martin think?
Finally, Christoforos from Greece sent us a video question, asking how the EU can avoid a repeat of the Bangladesh factory collapse that cost over 1000 lives earlier this year. If restricting imports is not the solution, then is there anything else that European countries can do to promote better industrial safety in developing countries to avoid similar tragedies?

Vote 2014

Voting is closed in our Debating Europe Vote 2014! The results are now in, so come and see what our readers thought!

IMAGE CREDITS: CC / Flickr – J Aaron Farr

62 comments Post a commentcomment

What do YOU think? Has Europe benefitted from an increasingly globalized world? Or has globalization destroyed European industries and generated unsustainable trade deficits? Is globalization inevitable, or can it be balanced and moderated? Let us know your thoughts and comments in the form below, and we'll take them to policy-makers and experts for their reactions.

  1. avatar
    Christos Mouzeviris

    The second option.. It destroyed our industries… The only one who gain in Europe are the rich businessmen and multinationals.. Period..

    • avatar

      Agreed! Globalization is only for the benefit of developing countries and the wealthy. Normal people living in Western countries get the short end of the stick in all respects.

  2. avatar
    Catalin Vasile

    Bad think this kind of globalization!Yet, no politician comes with something realy good for the citizens but for themselves strugling to keep the power after they grab it!

  3. avatar
    Mirko Celii

    Yes, of course!!! Just watch the unemployment growth in the eurozone. Good job, guys *_*

  4. avatar
    catherine benning

    Globalization is not good for Europe because it is a scam. We have been sold down the river by a bunch of con artist who should lose their cajones for what they have done to a thriving civilized economy.

    This man’s segments are numerous. He offers real food for thought. And with it, evidence. That is a way of showing how discussion is factual. And the one thing we get so little of today. Evidence is missing from most all of what our politics point to. Take the ‘evidence’ of WMD. The lack of it is astonishing when you consider the amount of surveillance used to watch our every move day and night.

  5. avatar
    Debating Europe

    Nuno, that’s a particularly philosophical question. We’ll need more coffee before we tackle it. ;-)

  6. avatar
    Nuno Roberto

    Still, and letting jokes aside, i really believe that the threat to Europe comes from inside, just like it has always been, eg: Napoleonic wars, first and second world wars, etc…

  7. avatar
    Miguel Delié

    What is good for the european consumer is bad for the european industries that in turn are employers of many consumers. Loss of industries, wages and purchasing power. A fatal elipse? Perhaps not given that the correlation might not be so simple but still something to think about given the competition asymmetries.

  8. avatar

    Globalisation is totally good for those that can compete and work with other nations! Keeping the European advantage isn’t a right, it has to be earned. Earned in terms of creating products the world wants, rewarding ourselves responsibly and working as hard as the rest of the world (and if we want more free time, which I do, then working smarter and more productively is a must). If we can’t do that, then Europe doesn’t deserve what it has (which I believe is taken for granted far too much!).
    On the whole it’s a win win, brings better economic growth, more stability in the world and is a better way of engaging than foreign aid (though corruption can dent this point)!

  9. avatar
    Paul X

    Globalisation can never be good for countries who want fair trade conditions because there is no such thing as a global standard
    Price will always be the prime consideration for many countries and there will always be a market for cheaper goods, so those who refuse to import from counties with sub standard labour regulation are just imposing a financial penalty on themselves

    • avatar

      I agree with your angle. Can you expand on fair trade conditions though? I think many believe the world runs on western Europe ideals (not a bad thing but perhaps unrealistic in a short time frame, say some years)

  10. avatar
    Nuno Roberto

    And let’s not forget the balkan situation that, even after 20 years or so is not quite stabilized.

  11. avatar
    Limbidis Adrian

    Let’s get on thing clear :
    THIS kind of globalization where the corporate power roams unchecked and the rich can do as they please while the poor and working people are bullied into submission through low wage workers or outsourcing blackmail is WRONG and Europe does NOT WANT IT.

    • avatar

      Strong argument and one which many countries I suggest struggle with! However how do you encourage business to invest in jobs without offering those at the top a reason to? Do you expect a govt to offer real growth and meaningful jobs through any taxes received? How would they do it?

  12. avatar
    Hamza Serry-Senhaji

    Globalization has been on balance a good thing for everybody. The more we trade,the better the society is because the less risk and conflicts there is. Some industries benefit more than others. In the global economy, those who can adapt to a changing environment are winners.

  13. avatar

    Globalization is often viewed solely from the standpoint of economy and then put the emphasis on its impact on trade liberalization and the development of free trade. Nonetheless, globalization encompasses a much broader aspects of society. “Europeanization is a rational political response to globalization” (G.Šroeder). Motivation is an obvious struggle for new markets but has opinions and that motivation is the quality of goods to be sold in countries where there are strong buyers expensive and high-quality goods. Third World countries that have nothing to look and globalization affects them exactly. Countries that are geographically in the territory of Europe and non-EU countries have little chance of success if they get into a vicious circle of the EU market. However, the more welcome as buyers of goods from the EU, but as producers of goods to the EU. Globalization is best for the strongest EU economies, Germany and France, because they do not believe the story of the international division of labor which would be good for all countries if it were sincere intention creators of globalization.

  14. avatar
    Yo Lou

    The problem is not globalization if people had enough Money to buy things. Unfortunately europe miopi tries that people become more poor to help international financial groups

  15. avatar
    Joaquín Vicente Ramos Rodríguez

    In my opinion, the right question will be: What kind of things are good and what kind of things are bad for Europe about globalization phenomena?

    • avatar

      What if I suggested the scenario of globalisation in it’s current form is good for emerging markets and bad for Europe? Hypothetical but for European ideals, is it better for the rest of the world to benefit at the expense of Europe? (though neutral on the idea, I would suggest Europe is damaging itself economically compared to the rest of the world)

  16. avatar
    Rene Birger Pedersen

    Hi, globalization is good for the strong European companies which mean in general the European multinationals companies. Since globalization means more equal competition which means the healthy and strong European companies do/will benefit from the globalization.
    Weak and not healthy European companies will sooner or later died regardless of globalization.

  17. avatar
    Olivier Laurent

    Basically you ask if having peaceful exchange with people living in far away countries is impoverishing us and if closing down frontiers would enriching us..

    It is like asking if the more freedom you have the poorer you will be…

  18. avatar
    Gigi Alexandru Muresan

    Not only the developed nations that are complaining about its negative effects, people in developing nations – where most of the industries have been set up, have their own set of reasons against globalization. They often complain that their cities have been reduced to garbage-dumps where all the industrial waste is accumulated and pollution levels are sky-high.

  19. avatar
    George Chalkias

    The globalization(open borders) is good for economy. The problem is that we have only few globalization.

  20. avatar
    John Buchan

    unsustainable trade deficits because of Euro eg GERMANY — GREECE AND REST OF SOUTHERN EYRO ZONE

  21. avatar
    Marcelo Melo

    Globalization is yet to be achieved at envinronmental level, being this one of the reasons for the turbulence in european economy.
    Besides, globalization requires transparency and when the money that is out of the globalized economy system is as high as the GDP of USA + Japan, the desired stability and continous progress will not be achieved.

  22. avatar
    catherine benning

    Europe is in a suicide pact, and the worst is yet to come.

    And did you know 4% of Americans are today living on $2.00 a day. That’s right two dollars a day. Equivalent to the third world countries they and we are sending AID to support. And the American who suffers this is living in a first world economy so his starvation is far worse than those to whom we show our largesse.

    Perhaps Mr Obama would like to tell us why he supports us being led by this example to starve our citizens of food and health the way they are prepared to do in the USA. Yet he supports the cost of war on Syria when the majority of the world and the people of the world are against it? Is he telling us he can’t see this horror his people are being forced to endure as he spends their funds on aggression?

    Wake up people.We are being sold down the river.

  23. avatar
    Nir Lama Aasaphal Yatri

    for the future develop in eu industry first make comedown goverment tax then only give them who work hard work like nepali worker . now the europe industry getting reduce in financial backround oneday they all off close if not care finance

  24. avatar
    David Eaton

    In some way it is creating damage because of outsourcing to non ETA states is costing EU citizens jobs much should be done about that

  25. avatar

    Globalization, it is good for rich people, not so much for the rest of us.

    The race to the bottom (re: wages) is in full swing. The more free trade you have, the worse it will get. Europe is rapidly destroying itself. And we see it all around, austerity for the poor, bailouts for the rich, and the middle class have to pay for everything.

    The EU and the wealth-destroying Euro are part of the problem.

  26. avatar
    Manuel Gps Lopes

    Yes, of course! Investors of globalization have only a “homeland” for their money: the countries of cheap labor and abject living conditions.

  27. avatar
    Miguel Veríssimo

    West/Globalization strategy was simple:
    – facing increasing tided working rules, environmental protection, immigrant working force to work on industry, context costs etc, western companies fount out that producing in other countries, opening markets, instead of evolve, they could continue the same model without costs added!
    But also without value added. The general idea was that EU, US, Japan, etc well trained and creative brain working force and low cost products from China, Brazil, etc, could maintain western economies until a new technological breakthrough showed up and save the world!!
    This new model is now clear – ECOlogical society…
    But this strategy has a lot of misconceptions:
    The economies of scale of developing countries are to appeal. Universities, R&D centres, brain power, etc, patents, brain property is also moving to other places, reducing western economies value in all fronts.
    Volvo is an interesting case study – China as problems with cars security, China buys Volvo, etc… etc…
    Of course Globalization is spreading wealth! But without being protective, dumping strategies on labour, production costs, etc… must end!!! Or, western countries will compromise their sociocultural achievements levelling to “medieval age” benchmarks….
    That’s not a developing model!! That’s stupidity!!!

  28. avatar
    Paul X

    @ Jj
    The fair trade conditions are just as you describe the European ideals

    Europe has a moral approach to working conditions and does not want to trade with countries who do not meet their self imposed standards on child labor, working time and conditions etc

    There are countries who will always be prepared to trade with those who do not have regulated working conditions because of the lower cost so I believe unless there are some global standards introduced, globalisation will always disadvantage those countries with “morals”

  29. avatar

    First of all there this interesting book that argues against this “free trade” stuff we’ve all been fed as the holy grail:
    Then there’s the 2nd interesting book that argues that we don’t need to “motivate” businesses anymore, we just remove them from our economic cycle.
    Economist and professor Richard Wolff goes even deeper with his analysis in:

    After you read these two books in depth and understand them. You know that we don’t NEED to motivate these bastards to “invest”, we can simply…phase them out.

  30. avatar

    @Paul X
    Risking playing Devils Advocate here, can we ask the world to play at EU standards though? A lot of those value could be cultural and require a certain economic base that not all countries enjoy? It could re-enforce the arrogant European stereotype and perhaps blinds us to values that the EU should adopt (a stronger caveat emptor a la Chinese policy maybe?). Just a thought.

    I think the main stream economists would still back the values of free trade. I don’t know the books in question (and will add them to my reading list) but from what I understand about Richard Wolff he has done excellent work regarding class economics within the US however also looks strongly at Marxist economics? If so then I can see the argument for a more centralised model overfree trade. I would however put forward that free trade has performed as a better model than the marxist theory? I suggest that China’s economic growth as a case in point started to rocket partly because they moved away from a marxist economy and into a planned market economy (which is continuing to be opened up in a very planned way).

  31. avatar
    Rene Birger Pedersen

    The learning from the Great Depression in the 30th
    Was that protectionism is just dragging down the economy and making people even more poor.
    It was a great achievement when most countries did sign and implement the WTO agreements.

  32. avatar

    In next ten years the countries waving baton in this more global world are: China, India, USA and possibly Brazil. Also Russia will propably continue in the ‘gang’ even though they have lost clearly the place as ‘superpower’. On big issues and matters even France and Germany will be nothing compared to these nations. Needless to say that other european countries even less.
    That is why we have European Union. There will never be a world superpower in europe. But all the european nations can form together a whole. Their voices combined they will be atleast as strong as USA and China. However in such matters like sustainable development, human rights, democracy and peace european union is and will be a forerunner compared to the others.

  33. avatar
    Teimuraz Dzagania

    Good all day
    chesst big for me to be accepted our pan-European forum
    thank you

  34. avatar

    Globalization is a net loss for the West, unless you were already a millionaire when globalization started. Taken from this article:

    “In real terms, Americans are on average no better off than they were 30 years ago; in Britain, the Institute for Fiscal Studies says that our real disposable incomes are in the midst of a 14-year freeze. Vast tracts of gainful employment in textiles, potteries, shoe-making, machine tools and many other industries have disappeared, to be replaced by… well, not very much at all outside the now languishing financial services industry and the housing market.

    The West’s competitive advantage, even in hi-tech industries such as pharmaceuticals and aerospace, is being fast whittled away too. The welfare and health entitlements to which we have become accustomed look ever more unaffordable, while the final-salary pensions that workers could once expect as reward for a lifetime of service are now confined to the public sector – and those too will surely be gone within 10 years. It is small wonder that the benefits of free trade are now so widely questioned.

    On the contrary, by opening up the global economy to Asia, Latin America and Eastern Europe, the West seems to have unleashed a doomsday machine which threatens ever-greater destruction of its own living standards. After a brief number of years in which globalisation made everything seemingly cheaper, the terms of trade have moved badly against the West.”

    At the end the author asks,

    “Where are the jobs going to come from, it is often despairingly asked, in Western economies? There’s a simple, if challenging answer: by returning to the way we were and doing more things locally. And that starts with washing our own sprouts for the Christmas dinner table.”

  35. avatar

    Globalisation is all good and bad as the same time;
    -When bad in some area then it’s Globaloney.
    -When good in some in some area then is Global.
    It’s all have to do with Cultural/Geographical/Economical/Administrative and Colonial History.
    Globalisation success requires a clear understanding of C.A.G.E distance framework between 2 Countries in order to avoid Globaloney.
    But Globalisation can also succeed when they are low in distance in Trade-flow and have International Interaction like Common Language/Trade agreement/Colonial link/ Common land borders.
    As says the 19 century British explorer David Livingston:” The World isn’t really globalised.
    But Globalisation are been going on for long time I shall say otherwise if hasn’t occurred the exotic product and plant find in our market would not simply have reach there. Of course Globalisation has increase and decrease variety and culture is visible element that prove it. Variety increases in fact beyond what we have as possession.
    With the Implication of the C.A.G.E Framework set a strategy to deal with differences:
    -Cultural barrier : Language
    -Administrative barrier : Governmental suspicion
    -Geographical barrier : Border
    -Economic barrier: Payment

    But to pretend that we are moving with any speed toward Global Governance, it Golobaloney, as all these Factor need to be taken into account.

  36. avatar
    OC Sisley

    few shattering previous records, typically set in the late 19th or early 20th century. Yet the absolute level of cross-border integration of such markets remained seriously incomplete, or semi globalized. This last conclusion seems to apply to regional and even local borders as well as national ones, although this note focused, for brevity, on nation-states rather than regions or cities as the unit of analysis.
    The obvious rejoinder to the previous conclusion is that if the world isn’t completely globalized yet, it soon will be.

    The intensity of international people flows has risen much more modestly over time than the intensity of trade and capital flows. Starting with migration, the proportion of the world’s population living outside of the country where they were born is roughly the same today as it was in 1910, about 3%. Finer-grained data over a somewhat shorter time frame do indicate an increasing trend, from 2.1% in 1970 to 3.3% in 2012. While the physical and informational costs associated with migration have declined over time, policy restrictions—visa and work permit requirements—have been put in place to restrict its growth. Visas were generally not required to travel between countries before 1913, and the United States did not begin requiring immigrants to obtain visas until 1924.
    Migration patterns reflect the persistence of economic gains as a motivator of international people flows. Among migrants from developing countries, 80% moved to countries with higher scores on the UN’s Human Development Index. Only 49% of migrants from emerging economies, however, moved to advanced economies, indicating very substantial migration from relatively less to relatively more developed emerging economies. Emigration rates are highest from middle income countries, as poverty itself constrains mobility from the poorest countries. The countries with the highest share of immigrants in their populations are countries that employ large contingents of migrant workers, most notably Persian.
    Gulf countries such as Qatar, where foreigners make up more than 70% of the population.
    Turning from quantity to price-based measures, the obvious indicator to consider with respect to migration is cross-border convergence of wages as a measure of the integration of labor markets. Data on the evolution of average GDP per Worker adjusted for Purchasing Power Parity (PPP) – a rough and ready proxy for average wages – across countries indicate that while incomes in industrialized countries have tended to converge.In addition to migration, a long-term people flow, more focused indicators of cross-border movements of people can also be examined. International student mobility represents a medium-term people flow. In 2011, 2.2% of the world’s university students were enrolled in degree programs outside of their home countries, up only slightly from 2.1% in 2005.30 International tourism, a short-term people flow, is more intense and growing more rapidly. In 2012, roughly 15-17% of tourist trips were international, and there were more than 1 billion international tourist arrivals for the first time ever, up from only 667 million in 2000.
    During 2011, people around the world, on average, spoke on international telephone calls for about 140 minutes, up from 88 minutes in 2005. These figures exclude calls that neither originate nor terminate via traditional telephone lines, but even adding in a rough estimate for computer-to-computer calls (Skype-to-Skype calls accounted for about 20% of international minutes in 2009), international calling minutes still account for less than 5% of total international and domestic minutes. The international share of telephone calls, thus, has remained limited even as the per minute cost of international calls fell 95% from 1980 to 2010.
    The internet has been celebrated for making distance (and borders) irrelevant, but internet use also remains primarily domestic. There are some technical issues involved with measuring the proportion of internet traffic that crosses international borders, but one estimate indicates it has remained fairly steady at roughly 17-18% since 2006. Information flows on social media are also primarily domestic. A published estimate indicates that only 16% of Facebook friends are located across national borders, and newer unpublished research points toward an even lower share. On Twitter, an estimated 25% of followers are located in different countries from the people they follow.
    With respect to general awareness about developments in other countries, it is useful to consider the (mainly national) media’s coverage of foreign stories. Data aggregated across three cross-country studies suggest that the average foreign share of TV news coverage is about 26%. Furthermore, roughly one-third to one-half of foreign news coverage focuses on the home country’s foreign affairs, indicating that the purely foreign share of TV news is probably in the mid-to-high teens. People also seldom view foreign news websites. Page views on news websites from foreign countries constitute 1% of total page views of news websites in Germany, 3% in France, 5% in the United Kingdom, and are in single digits in all countries for which data are available—as low as 0.1% in China.
    As far as technological knowledge is concerned, one indicator that supports the inference of increased cross-border knowledge flows over time is provided by cross-border licensing. While such licensing is not new—international royalties accounted for a significant component of James Watt’s receipts from his steam engine patents in the early 19th century, for example—the available data, along with informational and contracting problems that were even more acute early on than they are now, suggest that the voluntary transfer of knowledge across national borders takes place to a much greater extent than used to be the case. Concerning more general managerial knowledge, the post-World War II period, in particular, has seen the development of new types of organizations and organizational forms that have facilitated knowledge transfer as well. Franchising, which really emerged in its modern form in the United States in the 1950s, is one example. And management consulting firms, which began their international expansion at roughly the same time, are regarded as having evolved into major channels for the international diffusion of new managerial techniques. Of course, the spread of multinationalenterprises, intent on applying the same technological and managerial knowledge to more and more markets points in the same direction.

  37. avatar

    Either is bad or good, we are already moving towards globalization

  38. avatar
    Bill Hyde

    Developed countries can suffocate the development of underdeveloped countries.

    Social degeneration!!

    Economic depression in one country can trigger adverse reaction across the Globe.

  39. avatar
    Frank Joseph Maganga

    In my views, Globalization is absolutely good thing. Not only in Europe but also worldwide. Because it makes life easier through the use of technical tools in different fields.

Your email will not be published

Leave a Reply

Your email address will not be published.

Notify me of new comments. You can also subscribe without commenting.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

By continuing to use this website, you consent to the use of cookies on your device as described in our Privacy Policy unless you have disabled them. You can change your cookie settings at any time but parts of our site will not function correctly without them.