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6/21/17

Global Economy: Back to the Global Vertical -a politically dangerous development - by Andres Ortega

There are horizontal periods – indeed some people, Thomas Friedman among them, believed some years ago that the world was definitively flat. And then there are periods in which verticality imposes itself again.

In many ways, we are once again moving from the horizontal to the vertical dimension of global affairs.

This “verticality” is making itself especially felt in social terms. Social classes are back on the agenda, although not in the traditional Marxist sense of class struggle.

Rather, we are now coping with the decline of the middle classes and the emergence of a broader “precariat.”

The social escalator is not working as in previous eras, despite renewed growth in many economies following the crisis. Benefits that were taken for granted, such as full-time jobs with social security protections, are disappearing in significant numbers.

Perhaps we are witnessing what Dennis J. Snower calls the “great decoupling,” which he labels “dangerous,” unlike its predecessor, which was “convenient.”

When economic progress is not mirrored or is not linked to social progress, discontent is generated in those left behind. This decoupling ends up manifesting itself in politics.

This is what may be going on in many countries amid the prospect of recovery, an uneven emergence from the crisis and, before that, globalization, which is now generally acknowledged to have produced winners and losers.

The decoupling phenomenon is arising when the advanced economies, both industrial and post-industrial, are recovering from the crisis.

As Marc Fleurbaey of Princeton University argues, we must “prepare people for life and support them in life.”

Central to that is the commitment to education, particularly amid the challenge of technology and its controversial impact on employment and the concept of work.

A smart policy approach in that regard, as Ylva Johansson, the Swedish Employment Minister, points out, is not protecting specific jobs (which may be dying) as protecting workers (which need to be actively equipped and/or a guided toward a new one).

Somehow or other, although no one knows how, remedying the great decoupling will induce the vertical to become more horizontal again. Or so one hopes.

Failing to achieve this will only accentuate more verticality. And vertical moments, as we know, tend to be the more dangerous ones.

Editors note EU-Digest: but the situation is not hopeless. Change is possible. People can and will make the difference. All that is required is for responsible, well educated, socially conscious people, with new ideologies to start speaking out. The outdated, corrupt, political systems in many places of the world must be replaced before it leads to a catasthrophy

If it was possible in France, for a new party to be created within a one year time span prior to their Presidential and parliamentary elections, and for that party to win decisively, in both the Presidential and Parliamentary elections, it can also be done elsewhere. 

The old and established parties have failed the people. The political establishment on both the left and the right have become corrupted by corporate influence and greed. It is high time for change, because the status quo is not acceptable anymore.

Read more: Back to the Global Vertical

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