2 December 2019   Leave a comment

Globalization has transformed the nature of work. For most of human history, work, and its corollary, income, was local, and most workers sold their products within a very small geographic range (before the emergence of industrial capitalism, the range of economic activity in Europe was mostly within a 10 mile range). With industrial capitalism, the world witness the creation of factories and technological changes–such as railroads and steamships–expanded the scope of possible markets. Now the entire world is a single market, albeit one with lots of roadblocks. The name of the game now is avoiding those roadblocks with seamless supply chains. When US President Trump imposed tariffs–a quintessential roadblock–on Chinese products, US firms that used Chinese products set up operations, often with Chinese help, in countries like Vietnam and Bangladesh.

But in domestic economies, we have also witnessed the growth of what is known as a “gig” economy, where workers are nominally independent but still subject to the rules of a larger corporate entity, such as Uber. Katrina Forrester has written a fascinating book review on the nature of the gig economy and what it means for modern capitalism:

” What is new about the gig economy isn’t that it gives workers flexibility and independence, but that it gives employers something they have otherwise found difficult to attain: workers who are not, technically, their employees but who are nonetheless subject to their discipline and subordinate to their authority. The dystopian promise of the gig economy is that it will create an army of precarious workers for whose welfare employers take no responsibility. Its emergence has been welcomed by neoliberal thinkers, policymakers and firms who see it as progress in their efforts to transform the way work is organised.

The fundamental issue is obscured by the gig economy. We have developed a system in which “income” can only be earned by working for an entity that honors private profit. There is much work to be done that does not yield a private profit–think of people working to ease the lives of disabled people, people working to protect the environment, and people who teach poor students in poor areas. We need to break the link between income and profit. There is much more to human life than the accumulation of private capital.

The German Social Democrat Party (SPD) has elected Norbert Walter-Borjans and Saskia Esken as the new leaders of the party. These two individuals are closer to the original idea of the SPD and far from the SPD that has worked as a coalition partner to Angela Merkel. The question now raised is whether Walter-Borjans and Esken will keep the SPD in the government. Angela Merkel has undoubtedly been a constant in European politics over her four terms and she has held the line defending liberal values in a continent that has a number of political parties that repudiate liberal values. But she has been weakened over time and has announced that she will withdraw from politics soon. It is likely that Germany will soon lose its singular role in European politics and, aside from French President Macron, it is unlikely that any country can take its place. This is a bad time for Europe to drift apart any further. With Brexit and the emergence of China as an economic counterweight and the desire of Russia to become a dominant force in Europe, Europe can ill-afford to lose its legacy as a protector of liberal values and institutions in the world. The US has decided to abdicate its role as the main protector of those values.

Posted December 2, 2019 by vferraro1971 in World Politics

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