During the last two decades or so there has been a growing trend towards globalisation of trade and commerce and a free-market economy. The academic economists believe that these steps would give a spurt to forces of competitiveness, efficiency, better job opportunities and generation of more wealth and prosperity.
But one has to take into account not just these benefits but also the overall consequences of globalisation and the free play of market forces. As everyone knows, globalisation is only a small bit of economic philosophy or policy and one must know the all-inclusive worldview or philosophy of which it forms a part. Without viewing it in the full context, one may have an erroneous view of it.
Like, the globalisation of business and trade without a global view of society as a global family would lead to social tensions and economic strife and this is what we are experiencing today.
Also, globalisation in economics is an outward-looking view and if it has no corresponding inward — looking view, it would unleash bitter competition and in the absence of the inward-looking balancing forces, it would lead to stark materialism and commercialism, diminishing or setting at nought the values of sympathy, kindness, compassion, world-brotherhood, co-operation and so on. Thus, it would not only destabilise the financial markets but create disharmony in human relations as well. Moreover, it’s a known fact that capital tends to flow from countries that have free — market economies to other countries where it has a better chance of profit by employing cheap labour, available resources, etc., whereas labour does not find it as easy to go to places where it has better prospects because labour has emotional ties with family and is affected by family circumstances.
Thus, due to better mobility and flexibility of capital in contrast to that of labour, international portfolio investors, and not the labour, would benefit the most.
Thus, globalisation would result in disproportionate profit to those who can invest capital and it would lead to uneven distribution of benefits and social and economic deprivation. Further, in a free-market economy, every player in the manufacturing sector would tend to drive others out of the market and thus competition would grow and stiffen and the financial markets, which are inherently unstable, would accentuate instability.
Thus, the whole economy would never return to some kind of equilibrium. In this state of instability, the business and industrial class would tend to adopt all sorts of unfair means to prevent any dwindling of its profit and, thus, the whole atmosphere would be vitiated, for the portfolio investors would try to take the politicians and the bureaucrats also with them to survive or thrive.
This would further give rise to corruption, black money and other evils. Thus, it is strange that our leaders talk of moral values on the one hand and of globalisation on the other hand without making any efforts to make popular a global spiritual view of society as a global family. One can see that the major economic powers today dominate the multilateral trading system. They define and redefine globalisation to suit their national interests. This leads to clashes of interests and instability. Again, to assess the merits or demerits of a system, one should also go into the ideological base of a policy and take notice of its consequences.
We should ask ourselves the question as to why we want a free-market economy or a state — controlled one. We should be clear in our mind about our desirable goal and see whether a particular form of economy takes us towards that goal.If our goal is to remove poverty and great economic disparity and to have a society based on economic justice and fair play, then we should sort out whether globalisation or a state-controlled economy can do it better.
This should be judged by those who are neutral and have no vested interests in either form of economy. So, if in the present world situation, we must have globalisation, then we should have a global open society that has some sort of state control in certain sectors and constantly strives to correct and improve. In any case, a happy blend of economics and spirituality — both based on values — is necessary and, in the process of decision-making, involvement of such institutions as are neutral would be beneficial.
(The writer is a spiritual educator and popular columnist. Views are personal)