Monday, 18 January 2016
The first casualty of globalisation is democracy
This month's article for Socialist Factor.
More than 1,000 jobs are to go at UK Tata Steel plants, mostly in South Wales. Tata said 750 jobs would go in Port Talbot, while 200 support staff elsewhere would be axed. Various politicians are clambering over each other to blame something or other within the domestic sphere, with some blaming EU energy policies. That is only half the story.
Certainly our whimsical energy policies, driven by the zero carbon agenda, have not done our heavy industry any favours but it has to be viewed in the context of much broader trends where we see a global slowdown in just about everything - and everybody is feeling the pain.
British steel in particular is affected by a change in subsidy policy on renewable energy, leading to a divestment for wind energy - which has in many ways been keeping specialist steel producers afloat. However, in a global slowdown with a building resentment at increases in domestic energy costs, keeping our steel industry afloat through an indirect subsidy was never going to last. The death of British steel has been on the cards for some time. Many are surprised it has lasted this long.
Some are eager to blame cheap Chinese imports, however China is not faring too well either. We have seen a collapse in shipping demand, and consequently reduced orders for new ships seeing a slowdown in steel production and the closure of shipyards. We therefore have a supply glut and low steel prices.
The downturn in shipping is further provoked by an oversupply of capacity as older ship are not scrapped due to low steel prices. This leads to collapsing freight rates, reducing the overall profitability of shipping. It's a vicious circle.
This has prompted urgent action from the WTO in seeking to open up new markets the world over. The primary concern is removing technical barriers to trade, harmonising global trade regulations and investing heavily in port construction and modernisation.
In this there is a global agenda for port competitiveness in order to cut out unnecessary losses from delays and spoilage of goods. This means renewable of infrastructure but also privatisation of port services and ports themselves.
The shipping industry, with the whole world as its workplace and its frequent contact with officials and authorities, is vulnerable to attempts at corruption, bribery and demands of so-called ‘facilitation payments’, which can have serious consequences for the crew, employees and ships, as these can be held back if the shipping companies refuse to pay. Eliminating this kind of corruption by modernising methods and processes is essential to enhancing the reputation of ports and improving profitability. Meanwhile, opening up ports to competition is considered crucial.
Adani Ports and Special Economic Zones Ltd (APSEZ), India’s biggest private port operator, on last month started construction of a new international container port at Vizhinjam in Kerala, with the Union government agreeing to ease a key law which will allow foreign container shipping lines to operate between the new port when it begins operations and other Indian ports. This is the same agenda driving the EU Port Services Directive.
It is not then by accident we see port strikes in Greece, Brazil and India. There can be no doubt that there is an aggressive global agenda which is why we see so much happening simultaneously with weaker government putting up very little resistance.
In this we see alliances of massive shipping companies, gradually becoming vertically integrated, joining the WTO Trade Facilitation Alliance, steering the agenda from the very top of global governance. Their own influence dwarfs that of many nations. They are now branching out into the construction and modernisation of roads and rail systems leading to ports - and wherever possible, automating manual processes.
This will see a major shift in the types of jobs and supporting industries in developing nations and consequently this will cause social revolutions throughout the globe, especially as new markets are found for western exports and developing nations can finally get their agricultural goods to market without wasteful spoilage.
This hints at a great many new opportunities for growth and the emergence of a global single market in goods and services. While we are looking presently at a global slowdown, there is no reason to take a pessimistic longer term view.
Change of this magnitude however is not without its victims. And to me one of the first victims in this process is democracy. TTIP being a particularly obvious example, with the EU assuming competence over many different areas and using them as bartering chips - from intellectual property to data protection rights. The same applies to trade facilitation elsewhere where the sustainable development agenda conjoined with WTO efforts is dictating every last detail of domestic law for emerging economies, even down to imposing its environmental restrictions on plastic bags.
From a left wing perspective it would be called the "international neoliberal conspiracy" - except that those who would normally object to such a thing seem to have absolutely no problem with it being imposed on the EU without member states having a veto.
In many respects, globalisation of trade and consequently regulations and logistics systems is an inevitability. How that transition is managed and whether it is democratic, transparent, accountable and fair is another matter entirely. When our own government has little in the arsenal to stand up to global measures it objects to, what hone has Uganda or Thailand?
Disturbingly, much of this is done with very little public consultation, and it is of such complexity and dryness that our media would scarcely be bothered to report it even if they knew it was happening. Seldom do their horizons extend further than the EU and even then, their reporting of it is superficial and often flat wrong.
In this we cannot say we have a true democracy in the classic sense in that not only is our government sidelined in the adoption of global measures, usually with the EU dictating the agenda, and we are lacking the defence mechanism that would usually be found in a combative and inquisitive media.
For this reason alone, the public must develop their own intelligence communities in order to understand what is going on, promoting a healthy blogosphere and turn their backs on the legacy media who control the agenda largely through their monopoly position rather than any particular reputation for accuracy and quality.
There is much to be welcomed in this new drive for competitiveness and uniformity of trade, however, too much power is being exerted from anonymous places with too few eyes watching, where the light of media never shines. In this we must play our part in raising awareness of what lies above governments and regional blocs and whose tune they are really dancing to.