Rodrik: ...Nationally we have democratic institutions for deciding who benefits from markets and how resources and income are to be distributed. Internationally, all we have are tool shops and arrangements whereby trade lawyers and technocrats decide on a global agenda without any of the legitimacy or authority that you have at the national level. When you look at it from that perspective, I am not surprised at the backlash against the international arrangements that were created in the 1990s and that have led the push to globalization.
Judis: Are you saying that in the ‘90s, the United States should have been much more wary and cautious when it helped to found the main international trade group, the World Trade Organization (WTO), in 1995?
Rodrik: A lot of wrong turns were taken in the 1990s. The WTO had some good things in it, but as a trade regime, it exemplifies global overreach. It tries to fix global standards for intellectual property rights, industrial policies, and various health and safety regulations. As a result, it reached into areas that are more properly a national responsibility and where the argument for global harmonization is quite weak. It was bad economics that resulted in a loss of legitimacy for the global trade regime.
Another wrong turn came in what the United States didn’t do when it opened its economy with NAFTA, the WTO, and then the entry of China into the WTO. At some point, the United States could have done what Europe did in an earlier stage in this history when Europe became an open economy. That is to erect very generous social insurance and safety nets. The kind of insecurities and anxiety that openness to trade creates can be compensated or neutralized by having extensive social policies, and that’s what Europe managed to do.
Europe is much more open to trade in the United States. Yet to this day, trade remains uncontroversial in Europe. When you look at populism in Europe, it’s not about trade at all. It is about other things, it is about immigrants going to reduce the welfare state.
Judis: But aren’t populists in southern Europe and France up in arms about Germany and its trade balance?
Rodrik: It’s about macro finance, it’s about the role of Brussels, it is not about putting trade restrictions on China and Mexico. In Britain, the Brexiteers wanted to leave Europe in part so that they could pursue free trade policies unencumbered by Brussels. The issue of trade and import competition was largely neutralized as a political issue in Europe by the tradeoff of a generous welfare state. When the United States became an open economy in the ‘80s and ‘90s, it largely went the other way. We didn’t try to erect a stronger safety net. If anything, the safety net was allowed to erode. That I think was a major wrong turn and we are paying the price for that now.
Judis: If you look back at the 1996 election, and Bill Clinton’s speeches, when he said change is our friend, he was saying what you’re saying. He was talking about a more generous welfare state, mainly in terms of education and health care. And in his second term, before the Monica Lewinsky scandal broke, and Republicans began impeaching him, he wanted to expand Medicare, and other programs,
Rodrik: You’re right, there was a fork in the road. I do remember that. I remember my stuff getting cited at that time [Has Globalization Gone Too Far? came out in March 1997], but in fact there wasn’t much action. There was a general problem even with the center-left. You heard let’s liberalize finance and let’s do trade agreements and don’t worry then we’ll have compensation and the education and the transfers. In the end, we got a lot of the first and very little of the second, and that’s how I think the center lost its credibility.


おっしゃる通りで、それが分岐点でした。そのことは覚えています。当時私の著書[1997年3月発売の「Has Globalization Gone Too Far?*1」]が引用されたものでした。しかし実際のところ、行動はあまりなされませんでした。中道左派でさえも、一般的な問題を抱えていたのです。金融を自由化し貿易協定を結ぼう、補償と教育と所得移転をするから心配しなくて良い、という話がされましたが、最終的には前者は大いに実施され、後者はほとんど実施されませんでした。それで中道は信認を失った、と私は思います。


Has Globalization Gone Too Far? (Institute for International Economics)

Has Globalization Gone Too Far? (Institute for International Economics)