The Decline and Fall of Globalization

Excerpts from the book

Confronting Complexity

X-Events, Resilience, and Human Progress

by

John L. Casti

Roger D. Jones

Michael J. Pennock

preface

table-of-contents

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This blog was written by John Casti after publication of Confronting Complexity and after the 2016 Presidential election in the U.S.

 

To understand what happened in the recent US Presidential election, we have to go back to the early 1980s. At that time the overall global social mood shot upward, probably as a consequence of growing international financial integration that tended to undermine the age-old paradigm of “international diversification”. As the social mood became ever more positive, feelings that “everyone is a potential friend” grew stronger and drove events toward increasing interdependence, trade, and cooperation. It’s no accident that the European Union was formed during this period, along with the World Economic Forum in Davos. This story is graphically shown in the diagram below, where we see globalization totally flat until the mid ‘80s, where it exploded until around 2008.

 

Interestingly, even experts fail to see major changes in their own field as illustrated by the statement made by the A. T. Kearney Global Business Council in 2007:

[In] 2007 the [A.T. Kearney Global Business Policy Council (GBPC)] discontinued publication of its annual Globalization Index, which for more than a decade had tracked the progress of increased financial, trade, and other types of global connectivity. Simply put, globalization had graduated from a carefully studied set of trends to an assumed constant—a relentless engine that was shrinking the world, with upside for businesses everywhere. The elimination of “globalization” from our business vocabulary was simply a testament to its incredible success.

pictureglobalization

 

 It’s amusing to note that in 1992, the only presidential candidate who expressed concern over “the giant sucking sound” of US jobs vanishing due to the North American Free Trade Agreement was Ross Perot. But by 2016, both candidates expressed deep concern over all such international agreements. For instance, Donald Trump called the Trans-Pacific Partnership “a horrible deal,” while on May 9, 2016 Hillary Clinton called for a new “Trade Prosecutor” to protect American markets.

 

At this point I was pretty strongly convinced that Trump would win the presidency rather easily (as indeed he did). Basically, what I envisioned as the source of this feeling  is something that I talked about in my book X-EVENTS, and that I first spoke in public about in 2008 or 2008. This was the end of globalization. At the time, I was thinking only of the kind of globalization that most people think about using that term, namely, economic globalization. But, in fact, I should have noticed that politics always follows the money, so that if we get economic localization, political localization will follow as surely as January follows December. And indeed we have already seen this kind of localization here in Europe over the past couple of years. Trump’s election now begins the era of global localization. And if it had not been Mr. Trump, it would have been some other far right of center candidate.

 

 

I’m afraid Trump is the effect, not the cause. The cause is a growing negative social mood in the population, wherein people begin fearing the future rather than welcoming it. In such circumstances, you can expect to see collective social events like elections tending to lead to outcomes that are “localizing”, not “globalizing”, “rejecting” rather than “welcoming”, “xenophobic” rather than “open”, and so forth. And indeed this is exactly the case with Trump’s election.

 

To conclude, let me say that the age of globalization lasted for around 30 years; the age of localization will be at least as long!

 

John Casti; November 22, 2016; Vienna, Austria

 

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