The gap between political and economic freedom

For my third consecutive post related to the fall of the Berlin Wall, I would like to bring up The Economist’s Leader on the Berlin Wall, who I thought had a thought-provoking insight as to globalization in the post-Cold War. The specific observation lies near the end of the article: “Economic freedom could be slowed down, perhaps even reversed, by politics.” Citing Marx the article points out the uneven distribution of capitalism’s winners and losers:

[Capitalism] leaves behind losers in concentrated clumps (a closed tyre factory, for instance), whereas the more numerous winners (everybody driving cheaper cars) are disparate.

Capitalist economics is about the average level of boats. Politics, on the other hand, are personal. Despite globalized economic freedom Leader laments that: “Above all politics remains stubbornly local.” All those tyre factory workers are voters, voters that see only their locality sinking and vote to protect their boat. Hyper-localized popular animosity to globalization works its way up through democratic representation to national policy in the form of trade protectionism. The provincial outlook of electoral politics blinds voters to The Big Picture of Globalization. Thus, the gap between political and economic freedom is geographic. And the ironic thing is that globalization is supposed to remove those provincial boundaries, both in terms of trade and of information dissemination.

Which leads me to wonder: has the Internet, with its geography-destroying power, removed any of these blinders? There is ample evidence of the Internet giving local economic “losers” another chance in the global marketplace. Except for places like North Korea the Internet has worked wonders in showing how “the other half” lives. Is there any evidence that this has changed views on economic globalization or voting patterns?

And as for the other side, protectionist policies remain strong. Is there any evidence of use of the internet for protectionist ends? For example, like-minded unions from across the country or the world joining forces using the power of the internet?

About Younghusband

Sir Francis Edward Younghusband (1863-1942) was a British explorer, army officer, military-political officer, and foreign correspondent born in India who led expeditions into Manchuria, Kashgar, and Tibet. He three times tried and failed to scale Mt. Everest and journeyed from China to India, crossing the Gobi desert and the Mustagh Pass (alt. c.19,000 ft/5,791 m) of the Karakoram mountain range in modern day Pakistan. Convinced of Russian designs on British interests in India, Younghusband proactively engaged in the nineteenth century spying and conflict over Central Asia between the British and the Russians known as the Great Game. "Younghusband" is a Canadian who has spent a number of years bouncing back and forth between his home country and Japan. Fluent in Japanese and English with experience in numerous other languages from Spanish to Georgian, Younghusband has travelled throughout Asia. He graduated with an MA from the War Studies Department at the Royal Military College of Canada, where he focussed on the Japanese oil industry and energy security issues. He has recently returned to Canada from Japan, and is working in the technology sector.
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2 Responses to The gap between political and economic freedom

  1. This is a pivotal insight into understanding our economic challenges and their political ramifications.

    Globalization has been a net gain for the world at large. Higher standards of living and one of the greatest reductions in poverty ever (though the irony of reducing poverty is the failure to eradicate it due to the fact that those who would pass away now procreate thus producing increases in population that absorb much of what is newly produced).

    The benefits, though, are diffuse, the pains associated with efficiency and creative destruction very palpable and emotional.

    This is a paradox that cannot be fundamentally resolved. It will have to be managed. The problem with this (inescapabl;e though it seems to be) is that the need for constant recalibration quite possibly will lead to a catastrophic miscalculation where many benefits could be lost in moments of seething anger. Rationality does not always reign supreme.

  2. Anon says:

    A book on changes in information technology once claimed that when movable type was invented in Europe, it led to the Thirty Years War. Such a disruptive event will probably not happen because of the Internet.

    I’m skeptical about how the Internet could instantly help any sort of mass movements. Even thought its role was much lauded in the Obama campaign, it was still the groundpounding and outreach of millions of volunteers that sealed the deal. It may make it easier to find people willing to put in the work, but reaching through the ‘last mile’ still takes enormous and continuous effort.