Читать книгу Sustainable Futures - Raphael Kaplinsky - Страница 31

As we will see in Chapter 5, deepening globalization after the mid-1980s helped to rescue falling corporate profitability and prolonged the life of the atrophying Mass Production paradigm. However, outsourcing production to low-wage developing economies had important economic and social consequences. In the economic sphere, it resulted in widespread deindustrialization and persistent imbalances in trade for some of the major high-income economies, notably the US and the UK. In the social sphere, in most of the high-income economies it led to the collapse in employment and income in the rust-belt regions which had powered growth in the Mass Production paradigm’s heyday.

In the chapter that follows, I will show how these and other tensions led to the election of populist governments in a number of countries, including in the US. The Trump Administration placed trade imbalances at the forefront of its political agenda. Tariffs were introduced against $50bn of imports from China in 2018, and a further $200bn in 2019. China responded in kind with tariffs against imports of soybeans form the US. In 2019, the US took action to suspend sales of vital technology to Huawei, the Chinese telecommunications firm, and pressured its European ‘allies’ and Australia to take similar action. The US also imposed tariffs on imports of steel and aluminium from the European Union, which in turn threatened retaliatory actions. Australia’s call for an independent inquiry into the origins of the Covid-19 pandemic in China in May 2020 led to the imposition by China of damaging tariffs on Australia’s agricultural exports.

These unfolding tensions in trade between the US and its major trading partners have the potential to repeat the ‘beggar-thy-neighbour’ trade policies widely deployed during the Great Depression. In the 1930s, individual countries tried to protect their domestic industries from import competition. This led to a tit-for-tat response from trading partners and a downward spiral in international trade and economic activity. Coupled with the disruption to global supply chains during the Covid-19 pandemic, this has resulted in the disruption of one of the primary engines of economic growth in recent decades. In the modern global economy where supply chains extend across vast distances, a sharp reversal in the trajectory of global trade poses a severe challenge to the sustainability of economic growth in individual economies and regions such as the EU and North America.