[bobman0330]

DV,

Awesome post, thanks.

As for globalization and inequality, it's important to distinguish between increasing wealth and increasing inequality. I think most economists predict that everyone will be better off, through things like cheap clothes from China, cheap cars from Japan, etc. But theory also predicts that income inequality will increase. As a rough approximation, think of it this way. In 1950, capital was abundant in the US, and labor comparatively scarce. In the rest of the world, capital was scarce and labor abundant. If you marry those two worlds, there's more demand for American capital (to build factories in China) and less demand for American labor. Simple supply and demand suggests that wages will be adversely affected and capital return will be positively affected. (Of course, the really poor people in this picture, the foreign workers, make out fantastically.) The fact that real wages are more or less stagnant while corporate execs and shareholders are doing awesome bears that out.

As for whether there's a backlash on the horizon, you could well be right (and I hope I'm wrong.) I don't really see some sinister Democratic plan to roll back globalization, but I do feel that if they (or the GOP) came out with such a plan, it would do OK. Consider this excerpt from the Democratic State of the Union response:

[ QUOTE ]
When one looks at the health of our economy, it's almost as if we are living in two different countries. Some say that things have never been better. The stock market is at an all-time high, and so are corporate profits. But these benefits are not being fairly shared. When I graduated from college, the average corporate CEO made 20 times what the average worker did; today, it's nearly 400 times. In other words, it takes the average worker more than a year to make the money that his or her boss makes in one day.

Wages and salaries for our workers are at all-time lows as a percentage of national wealth, even though the productivity of American workers is the highest in the world. Medical costs have skyrocketed. College tuition rates are off the charts. Our manufacturing base is being dismantled and sent overseas. Good American jobs are being sent along with them.

In short, the middle class of this country, our historic backbone and our best hope for a strong society in the future, is losing its place at the table. Our workers know this, through painful experience. Our white-collar professionals are beginning to understand it, as their jobs start disappearing also. And they expect, rightly, that in this age of globalization, their government has a duty to insist that their concerns be dealt with fairly in the international marketplace.

In the early days of our republic, President Andrew Jackson established an important principle of American-style democracy -- that we should measure the health of our society not at its apex, but at its base. Not with the numbers that come out of Wall Street, but with the living conditions that exist on Main Street. We must recapture that spirit today.


[/ QUOTE ]

It's not exactly the Communist Manifesto, but the same sentiments could be reworked into an "Enough's enough"-type message that would have a lot of traction. If one of the bad things you mentioned happens, or even something like a moderate recession, I fear that a pretty robust anti-globalization movement could crystallize pretty fast.

I think some sort of government program to help displaced workers readjust is an excellent idea on its own merits. But even so, how much help can you reasonably offer a 40-year-old factory worker whose job has gone overseas?