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logo    The Unspoken Peril of Economic Globalization


The trouble with economists is that they're abstract analytical thinkers, i.e., if they're thinkers at all. They look at economic problems after disassociating them from all non-economic information, such as, political, moral, and even non-economic historical information. This leads to results that do not fit the real world. Just as president Bush seems to be in denial of the realities on the ground in Iraq, our economists who tout globalization seem to be in denial of the realities in the world.

One peril of globalization seems to have been missed entirely by these economists, and the history of Great Britain can be used to illustrate it.

Great Britain is a relatively small, island nation, which limits its domestic agricultural and industrial production. To overcome this limitation, Great Britain engaged in an imperialistic policy of conquest and colonization. To make that conquest and colonization easier, it directed its efforts to underdeveloped parts of the world, viz. Asia and Africa. This policy of conquest and colonization resulted in the often quoted phrase, The sun never sets on the British Empire. To secure commerce between Great Britain and these conquests and colonies, it built the world's largest navy, and this policy worked well for more than a century. But in the twentieth century, if all fell apart.

Great Briton found itself involved in two catastrophic wars, called World Wars, and the German submarine fleet wrecked havoc on these lines of commerce. If the United States of America had not come to Great Britain's rescue, the British would surely have been starved into submission, because Great Britain, as an island nation, was not self sufficient.

The lesson is that in a world prone to conflict because of incompatible political, economic, moral, and religious ideologies, having to rely on international commerce to maintain a nation's security is a perilous thing.

Furthermore, any imperialistic foreign policy, whether actual or merely economic, creates antagonism. Although the British Empire may have suited the British well, it did not do much for those in its colonies, nor did it earn the British any gratitude. Even today, the Indians honor their World War II veterans who fought on the side of the Japanese, not those who fought for the British.

There is no question that the United States has engaged in imperialistic policies throughout its history, especially since the end of World War II. America has invaded nations whose policies it hasn't liked, engaged in stealthy attempts, often successful, in overthrowing such governments, and employed what is benignly called economic sanctions to compel other nations to do its bidding. These imperialist policies has also earned Americans little gratitude. That the United States is pretty much disliked world-wide is now an apparent fact.

But what has all of this to do with globalization?

Well, the United States of America is no longer a self-sufficient nation. It now depends on imports for almost everything. What would happen to America if a conflict disrupted the lines of international commerce America now depends upon? What if a large portion of these imports could simply not get here? What nation could we rely upon to come to America's rescue?

Certainly not our Latin American neighbors! Many of them would be delighted to see America succumb. This leaves, perhaps, Canada, and I'm uncertain of how much help Canada could be.

Such a conflict, of course, would not have to be world-wide. Transport requires fuel, and a catastrophic conflict in the Middle East might be all the conflict necessary. Furthermore, such a conflict becomes more likely every day.

Some might say that the United States could recover, that it could rebuild its agricultural and industrial base. Perhaps! But that rebuilding would take time, and given the range and destructive power of modern military weaponry, the time to rebuild might be very short indeed.

So what is the peril of economic globalization. It can be put succinctly: Having to rely on international commerce for ones security is a perilous hazard in a world prone to conflict. And our world certainly is. (6/20/2007)