The election of Donald Trump has been celebrated by many of his supporters as the end of globalisation. It is not clear what exactly is meant by that, but still no-one should be surprised it is happening. Much of the impact of globalisation on the middle class of developed countries was predicted over 20 years ago.
Globalisation is not the same as trade, and the two are often confused. Trade is companies in one country transacting with customers in another. Globalisation, at least in the commercial sphere, involves large corporations putting different parts of their operations in different parts of the world: pursuing, as the cliche goes, the 'smartest minds and the cheapest hands'.
Much of what is recorded as trade is actually shipments inside the same company (half of China's 'exports' to the US are of this type — Apple products, for instance, being sent back up the company's internal supply chain). Indeed, a substantial portion of America's, Europe's and Japan's industry base is in China, which hopefully will be a disincentive to start a war.
By being able to pick and choose their work forces, company managers or owners acquired immense power over labour, allowing them to suppress pay rates. Hard won worker power has progressively been eroded as corporations have taken advantage of cheaper and more lax workplaces overseas.
In many industries, organised labour is a distant memory; many workers in America have not had a real pay rise in decades. Meanwhile, senior managers' salaries have ballooned. The resentment that this has caused was critical to the election of Trump, and the anti-immigration undercurrent in the Brexit vote. The losers in the middle class, it turns out, are also voters.
Evidence of the destruction of the lower middle class incomes in developing countries is easy enough to find, but one especially startling statistic is that in 2015 the bonuses paid to Wall Street, about $US28 billion, was double the total earnings of all Americans who work full time at the federal minimum wage of $US7.25 and hour.
Globalisation also has a financial dimension, which has allowed an international banking and finance elite to emerge. The results of 'freeing' up capital were extraordinary. Massive volumes of capital now slosh around the world: over US$4 trillion a day, according to the Bank for International Settlements. This is, in effect, like overlaying a giant casino over the world economy. It is reminiscent of Jorge Louis' Borges'