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The Economists were Wrong about Globalisation. Now They Tell Us! By James Reed
Anti-Trumper, and free trader economic rationalist supremo, Paul Krugman, has now admitted that globalists like him made a bit of a boo-boo with economic globalisation:
“In a column for Bloomberg titled “What Economists (Including Me) Got Wrong About Globalization,” Krugman admits that the economic consensus for free trade that has prevailed for decades has failed to recognize how globalization has skyrocketed inequality for America’s working and middle class workers.
In the past few years, however, worries about globalization have shot back to the top of the agenda, partly due to new research and partly due to the political shocks of Brexit and U.S. President Donald Trump. And as one of the people who helped shape the 1990s consensus — that the contribution of rising trade to rising inequality was real but modest — it seems appropriate for me to ask now what we missed. …
The pro-globalization consensus of the 1990s, which concluded that trade contributed little to rising inequality, relied on models that asked how the growth of trade had affected the incomes of broad classes of workers, such as those who didn’t go to college. It’s possible, and probably even correct, to think of these models as accurate in the long run. Consensus economists didn’t turn much to analytic methods that focus on workers in particular industries and communities, which would have given a better picture of short-run trends. This was, I now believe, a major mistake — one in which I shared a hand. [Emphasis added] Krugman, though, writes that he and his fellow free trade economists “had no way to know” that globalization of the American economy or a surge in trade deficits “were going to happen,” though the anti-globalization movement had warned for years of the harmful impact free trade would have on U.S. workers — including Donald Trump. In an interview with SiriusXM Patriot’s Breitbart News Tonight, economist Alan Tonelson said that Krugman’s acknowledging that he and the free trade economic consensus has been wrong is “better later than never,” but “the damage has already been done.”
The idea that the free traders had no way of foreseeing the damage that their ideas would do, is just self-justifying bs, for there has been plenty of literature predicting the negative side of free trade, for centuries. It is just that free trade is the philosophy of the moneyed elite, who do not care one jot about local workers, since the super-capitalist class only worship money and power. The entire fabric of neo-classical economics is a giant theological justification of capitalist greed, with no scientific merit at all: