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Globalization: An election issue stuck in the past

Election campaigns tend to teach you the wrong things about a country. You get an outdated, dark vision from candidates who portray a country that has supposedly been ruined by the other party.

The 2016 U.S. presidential campaign has taken this to a new, unprecedented level. It is a race between two candidates who come from our pixelated memories of the late 20th century, who focus almost entirely on a world that has not existed since the 1990s.

For sure, much of this is the fault of Donald Trump, whose florid imaginings of a menacing and racially divided America are drawn from the vanished trends of two or three decades ago, sounding as if he'd just stepped off the set of Home Alone 2 in a wide-lapel suit and pleated pants.

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He speaks of blighted inner cities that are a violent "hell" for their minority residents, 1992-style, at a time when U.S. inner cities are more successful and crime-free than they have been for the greater part of a century. He speaks of a northward flood of Mexicans, when there has been a large-scale net movement southward from the United States back into Mexico since 2008. And his language is full of references to the Bosnia and Kosovo conflicts, to the 1990s sex scandals of Bill Clinton (to distract from his own) and to competition from Japan, which was last a problem around 1991.

But the premillennial nostalgia show is not all Mr. Trump. The largest non-sexual theme in this election is one all the candidates seem to agree upon: the menace of globalization. The threat of global commerce and trade is a campaign plank that has brooked little or no disagreement between Hillary Clinton, Donald Trump, Bernie Sanders and the lesser Republicans.

Of course, "globalization" means different things to different people. When Mr. Trump's followers and associates denounce the "globalist elite" they are often using a current euphemism for an ancient conspiracy theory involving manipulative Jews. For others, it refers to any engagement at all with the world economy beyond a return to tariffs and national industries.

A more sophisticated and factual critique of globalization focuses on the "offshoring" of stages of manufacturing to lower-wage foreign countries. This "third wave" of globalization (the first two were the colonial period of the 19th century and the multinational corporation era of the post-Second World War decades) began in the 1980s and peaked in the late 1990s and early 2000s, when global manufacturing shifted to Asian outsourcing.

Third-wave globalization's main impact was to slash starvation-level poverty in Asia from 60 per cent of the population in 1990 to 3.5 per cent today. But it also did hurt working-class incomes in wealthy countries: Mid-range incomes rose only slightly in Canada, and have fallen in the United States.

That was indeed a big problem in the 1990s. But informed observers increasingly speak of "globalization" in the past tense. The practice of offshoring has been declining for almost a decade and shows signs of all but vanishing. A report this week by analysts at the bank UBS found that the key measure of "offshoring" globalization (the amount global production affects volumes of global trade) has fallen dramatically since 2010, to half its 1996 level.

In other words, globalization was a 30-year trend that is now almost over. Sending manufacturing to China is no longer worth the expense: Its wages have risen, and companies nowadays use technology rather than people to make things (a modern refrigerator, for example, is made using about two hours of human labour), so it's more convenient to do it at home.

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That's visible in the United States, where jobs are, contrary to election rhetoric, flooding back: It now has a million more factory jobs than it did in 2010. They'll never reach 1970s levels again, but that's because of technology, not globalization.

There are economic and employment problems in the United States. But they're domestic, not global. They're the sorts of problems that can be solved with more progressive taxation, a better education and health-care system, and a rebuilding of blighted regions. Those are the real-life problems and solutions we should keep in mind as we watch our southern neighbour crowd surf back into the 1990s

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About the Author
International-Affairs Columnist

Doug Saunders writes the Globe and Mail's international-affairs column, and also serves as the paper's online opinion and debate editor. He has been a writer with the Globe since 1995, and has extensive experience as a foreign correspondent, having run the Globe's foreign bureaus in Los Angeles and London.He was born in Hamilton, Ontario, and educated in Toronto. More


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