Distressed Workers: What Has Globalization to Do with It?

Bhagwati, Jagdish N.

We have recently witnessed a flurry of comment, by prominent figures such as Ben Bernanke and Larry Summers who are strong proponents of Globalization, asking the question: how do we assist the unskilled workers whose wages have been stagnating for far too long? Several of them also believe that even the "middle class" is at risk. Lou Dobbs of CNN, the labour groups' think-tank Economic Policy Institute, and nearly all the Democrats newly elected to the Congress, believe that globalization has much to do with the economic distress of the working and the middle classes. Therefore they have coherence and plausibility on their side when they want to lean on the door, even to close it, on trade with poor countries and occasionally on unskilled immigration from them. But the proponents of globalization, when they typically skirt and hence accept this "distributional" critique of globalization and nonetheless propose that the adversely affected constituents accept globalization but allow themselves to cope with their affliction in other ways, find themselves in a politically implausible position. Indeed, if it pours, we do not have the means to turn the torrent into sunshine and must open an umbrella. But man allows globalization; and men can turn it off.



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Journal of Policy Modeling

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January 28, 2013