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The Forum > Article Comments > New threats to globalisation > Comments

New threats to globalisation : Comments

By Saul Eslake, published 19/4/2007

It is not alarmist to say that 'globalisation' - as we understand it - with the benefits it brings to world economies is under threat.

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Meg
I gave data sources to support my statement that poverty is declining. Where are yours?

For the record, here’s the data to support my other arguments that you reject.

The statement that most agricultural produce is exports is based on government data:
http://www.dfat.gov.au/trade/negotiations/trade_in_agriculture.html#aae

Household incomes have increased at about 6% a year in Australia for the past ten years, easily enough to outstrip inflation and population growth, so real per capita income has risen
http://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/5206.0Dec%202006?OpenDocument

Suicide rates are decreasing:
http://www.ausstats.abs.gov.au/ausstats/subscriber.nsf/0/952361A2A29BDBB4CA25729D001C09CF/$File/33090_2005.pdf

Bankruptcy data can be obtained here:
http://www.itsa.gov.au

I’m not in the least confused about economic self-sufficiency, I know exactly how damaging it would be for an economy like Australia’s to try to go down that path.

Meg, you simply dismiss any arguments or data that don’t support your apocalyptic view of the world, without giving any evidence in support of your own opinions. Your abuse and vitriol are entertaining, but your arguments have no substance.
Posted by Rhian, Sunday, 22 April 2007 8:00:37 PM
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Rhian you gave no data to prove that poverty is declining…quite the reverse…and world-wide statistics disprove your theories…what rose-coloured glasses are you looking through now?

In fact your 'statistics' confirm my own statements...

RE: The widening gap between rich and poor in Australia...

[http://www.abc.net.au/pm/content/2005/s1430520.htm

Peter Ryan: ‘A survey out today from the Bureau of Statistics has found that the richest 20 per cent of Australians hold almost two-thirds of the nation's wealth, or an average $1.4-million per household.

The poorest 20 per cent holds just 1 per cent, with around $23,000 per home.’

Farmers share the same average income p/a as self-funded retirees at just $15000pa…I’d call that poverty by anyone's standards…

You need to also check your own reference data which shows that both the suicide and bankruptcy data confirm my statement that both are rising…

To rebound your own remark: ‘Your abuse and vitriol are entertaining, but your arguments have no substance.’

Check your own statistics before placing both feet in up to your knees… : )
Posted by Meg1, Monday, 23 April 2007 12:10:06 AM
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Meg
The media report you quote tells us precisely zero about trends over time in income and wealth. They are a snapshot of the situation at a single point in time. If you look at the survey on which the ABC report was based, you’ll see it shows that for all income groups real income has grown, with growth at the bottom of the income distribution, if anything, a little faster than at the top over the nine years to 2003-04:

Mean Income per week In 2003–04 dollars
(ie adjusted using changes in the Consumer Price Index)
Indicator __________1994–95 ___ 2003–04 __real increase
Lowest quintile _______ $181 ___ $226 _____ 2.5%pa
Second quintile _______ $292 ___ $361 _____ 2.4%pa
Third quintile _________ $404 ___ $492 _____ 2.2%pa
Fourth quintile ________ $539 ___ $641 _____ 1.9%pa
Highest quintile _______ $861 ___ $1027 ____ 2.0%pa
All persons ___________ $455 ___ $549 _____ 2.1%pa

http://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/6523.02003-04?OpenDocument

In any event, I never argued that the distribution of income is getting less unequal, thought these data suggest it might. Most importantly the fact that the rich are getting richer does NOT mean that the poor are getting poorer. If my neighbour wins first division lotto and I only win second, that doesn’t make me worse off. In fact, all income groups are getting richer, but some at faster rates than others.

From the global perspective, the UN report I linked to contains the following statement:

“In 1990, more than 1.2 billion people – 28 per cent of the developing world’s population – lived in extreme poverty. By 2002, the proportion decreased to 19 per cent.”

I’d call that a pretty substantial reduction in poverty.
Posted by Rhian, Monday, 23 April 2007 2:57:25 PM
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The supporters of the dying ideology that we call globalism have a bad habit of fudging statistics to make them more appealing. Or perhaps it would be more accurate to say that the champions of the theory, disconnected as the are from the broader world, are confident of their ability to reduce the enormous problem of global poverty to a set of figures to prove their case.

For example, billions of people live a rural existence in the developing world, relying heavily on local bartering systems for their needs. Such a life is impossible to measure by world bank or IMF methods. In search of a better life, they then move to a desperate urban slum where hunger, disease, dirty water, rape and violence are the order of the day. But in such a place, even a dollars worth of income can be measured. They are therefore said to have now taken a step forward and upward. The fact that they are often much worse off in real, absolute terms is irrelivent in western statistics - they are now "wealthier" so therefore they must be better off.

Globalism is dying, if not dead already, for the same reason that the last one-world economic theory died (communism). It simply doesn't work. Both represent extremes.

The idea that commerce would eventually trump politics, culture, religion, citizens rights, workers rights, human rights, nation-states themselves and the natural human tendancy to identify with all these things is the grandiose fantasy of the super-rich. Globalism is after all, an idea born at a billioinaire's club meeting (Davos).

It will be interesting to see exactly what replaces it.
Posted by Fozz, Monday, 23 April 2007 8:23:30 PM
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Fozz
You’re right that many conventional measures of economic welfare are poor at capturing the true living standards of people who live largely outside the monetary economy, such as subsistence farmers. But there are welfare measures, such as life expectancy, infant mortality, literacy rates or access to improved water that are not so vulnerable to those measurement problems, and should capture any general improvement in human wellbeing. The general trend across developing countries is that these are improving too, though less quickly than they could or should. In places afflicted by Aids, war or tyrannous governments standards are even going backwards, but these unhappy exceptions are not enough to offset the general improving trend.

Why do so many rural poor move to slums in the cities if they are as bad as you say (and I’m not disputing that they are)? The answer is surely that, however grim their urban existence, their rural alternative is grimmer.

I’m no Pollyanna, and recognise that the living standards of billions of people are appalling by the standards we enjoy. Not do I think that globalism alone will solve their problems. But I do believe that the key elements of modern globalism – increased trade and investment and the exchange of ideas - are a necessary and important part of the solution to global poverty, as well as being good for us in rich countries.
Posted by Rhian, Monday, 23 April 2007 9:13:33 PM
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Well said Fozz, you’re right to be concerned what will take it’s place as the Saul Eslake’s of this world will continue to roam the world trumpeting the latest ‘ism’ that will allow him to live Orwell’s dream of Utopia where some of us are ‘more equal than others’…and the rest are merely disposable minnows or usable commodities.

Rhian, you’ve again contradicted your own assertion…if I have $150/week and it costs $100 for me to pay basic living expenses for a week, while you earn $2000/week with a more extravagant living standard…having an increase of 2% for each of us means I will earn an extra $3/week while you will earn $40/week extra…

If the cost of living has risen by just 5%, $5/week…my income will be eroded very rapidly…and faster than yours. Considering the cost of many commodities and the variety of essential items has increased more significantly than this example, the result in Australia has been an erosion of middle Australia, becoming a struggling underclass of farmers, lower paid workers, self-funded retirees, disabled and pensioners…while the ‘ism’ circus continues to spin to dizzying heights of obscenity and indulgence for those willing to accept the rule of the jungle and to hell with all else.

Reality for the corporate players means the disparities are far more grossly exaggerated than these.

In fact, the corporate world will even reward you even if you fail to deliver…for some, to the tune of tens of millions of $’s…to excise your ‘services’ from the corporation’s payroll…of course, at the expense of the ‘underlings’.

(tbc.)
Posted by Meg1, Tuesday, 24 April 2007 12:11:58 AM
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