Hans Rosling-shit does not vindicate the IMF or global neoliberalism!

The following is a quote from this Ann Pettifor piece: http://www.primeeconomics.org/articles/is-globalisation-dead

"Globalisation and poor countries

Ed Balls, citing his personal experience of Indonesia, argued that globalisation had led to a reduction in poverty in that country, and worldwide. My experience of Indonesia was marked by the grave Asian financial and banking crisis of 1997-8, during which the Indonesian economy went into meltdown, banks failed, very high interest rates prevailed, and the rupiah sharply depreciated. Sustained pain was inflicted on Indonesians that were innocent of the crisis. 
Moreover, while it is true that poverty has fallen worldwide, the phenomenon cannot be wholly attributed to financial liberalisation or globalisation, but instead to advances in e.g. medical science and scientific development. Indeed, the numbers of those living on less than $1 a day fell most rapidly, not during the period of financial globalisation, but between 1950 and 1970 according to Bourgignon and Morrison (see Our World in Data, on global extreme poverty). 

(This chart thus shows that the rate of fall in the share of those living on less than $1 a day in 1950-70 is broadly similar to the rate fall in the share of those living on less than $1.90 a day in recent decades, from World Bank data).

To take another example, under communism, life expectancy rose broadly as much as it did under the capitalism of the pre-globalisation era. Despite China’s disastrous Great Famine, life expectancy rose from 44 years in 1950 to 65 by 1970 – well before Deng Xiaoping took power in 1978. In Russia life expectancy increased steadily until after the end of Khrushchev’s administration. It stagnated through the Brezhnev era, and then collapsed in 1991 as a direct result of financial ‘liberalisation’ and ‘shock therapy’. 

Globalisation’s failure to deliver & the rise of authoritarianism

In the BBC’s brief and pressured half-hour I wanted to get across that globalisation had not delivered on its promise – to make ‘the market’ the main driver of a more effective, more productive economy; to transform societies into nations of ‘shareholders’; to ensure a revolution in homeownership, and to avoid what Hayek called the threat of a totalitarian state.  

Instead financial globalisation has been an era largely fuelled by carbon (oil and coal) – as had been the case for over a century. However, unlike the Bretton Woods era, post 1970s de-regulated financial globalisation was built on mountains of private and public debt. The first – private debt -  led to recurring financial crises, and the second - public debt - rose as private sector activity weakened, and tax revenues fell. The consequences of these recurring financial crises in ‘advanced’ economies included ‘austerity’, the removal of employment protection, rising housing and education costs, the return of deflationary pressures, high unemployment, falling real wages, low productivity and rising inequality. 

These crises have led to increased insecurity and over-rapid social and economic change- as
well as the greatest financial and economic crisis since 1929 (itself a product of excessive
laissez-faire ideology). More widely, the insecurities and dislocations generated by financial
globalisation have led whole populations to seek the ‘protection’ of a strong man (e.g.
Presidents Trump, Duterte in the Philippines, Modi in India, Erdogan in Turkey,
Putin in Russia). Not that this worries the extreme adherents of laissez-faire – recall how
Hayek supported the murderous dictator Pinochet in Chile for his brutal imposition of
deregulatory ‘reform’.
 

And so, contrary to Hayek’s expectations, financial globalisation has proved that it is market fundamentalism, and not the regulatory state that is leading the world into an era of authoritarianism and totalitarianism – in the US, Eastern Europe, India and China. 

In the UK, average real wages are today lower than in 2008, no higher than they were in 2005, and in general we have to look back to Victorian times for such a stark period of stagnation. In the US, the position has been even more severe for huge numbers of working people.  Median annual earnings in the Bretton Woods period rose steadily until just after 1970. Then throughout the age of ‘globalisation’ or financial deregulation, American male real wages have stagnated. 

This, I contend, explains the rise of Donald Trump. It is an explanation, not a defence of his authoritarianism or of his administration’s irrational protectionism. "