Are economists nitwits? I don’t thinks so. They do though, like the proverbial generals, have a strong tendency to want to fight the last war.
In any case, it’s clear that globalization has reached some point of diminishing returns, at least as far as the electorates in free nations are concerned:
Weekly earnings for full-time American workers in the second quarter last year were unchanged from their 2000 levels – even though productivity grew by 18 percent in the same period.
Fifty-four percent of Western Europeans and 43 percent of Americans now believe their children will be worse off than they are in economic terms, according to a Gallup International poll in the last quarter of 2007 across 60 countries.
“Economic theory tells us that globalization is a win-win, but it isn’t, at least not in the West,” Roach said. “The theory was written for another era. We have to ask some hard questions about unfettered capitalism. We need a new script.”