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One of the growing areas of discussion these days concerns the future of globalization.
Beginning in the decade of the 1960s, globalization really got started and accelerated through most of the rest of the century. The recovery of economies around the world, given the leadership of the United States, set the tone following the Second World War and led to many years of growing cooperation and connectedness
World trade boomed, employment soared, and income inequality throughout the world declined
Not only did more and more countries become a part of what was happening, countries that formerly did not work together, began to work together.
One of the greatest partnerships to arise out of this environment was that of the United States and China. From the 1990s through the Great Recession, this relationship blossomed and all, I believe, benefitted from it.
During this time period, information grew and spread at a pace never before seen in the world and advancing technology became the norm of economic advancement.
Stealing Secrets
Spying and cheating took place within this world, but that is not an uncommon phenomenon in the sphere of technological change. We can blame China for acting in this way over the past thirty years or so, but China did not originate this type of behavior, nor did it do things that had not been done before.
There was a time, here in the United States when new startups were paranoid about their “intellectual capital” and did everything they could in order to hide secrets from others, startups that might be stealing their property.
Things, in my mind, have gotten better with regards to spying. Not that spying has stopped, but entrepreneurs have come to realize, at least most of the ones I know, that finding out what your competitors are doing is not a sufficient thing to worrying about.
Yes, you don’t want people to spy on you and steal your secrets, but in today’s world, a world that is changing very rapidly, young entrepreneurs have found out that their execution of plans gives them much more protection that any effort that they might make to slow down or stop someone else from copying their intellectual capital.
Putting your ideas into something marketable is the best way to stay ahead of your competition and then keep on improving your product. Focusing on this is far more productive than freaking out over the fact that someone might be trying to steal your secrets. And, even if they steal your ideas, they still have to execute and continue to produce the next version.
And, your competitors can still copy you when your product comes to market. Stealing secrets just gains a competitor a little time…maybe six months to a year. You still have to keep innovating to keep the lead.
This, to me, applies to the China situation. The Chinese are always going to be checking out what Americans are doing, one way or another. The best thing Americans can do is to keep executing and keep creating new ideas that enhance the product. This is just the way life is. It is not an argument for closing up world trade.
Globalization Is Under Threat
Intense rivalry is taking place now.
Martin Wolf, writing in the Financial Times, argues that the current rivalry between China and the United States, is not unlike the rivalry in the late 19th century and early 20th century between Germany and Great Britain. This time period marked out the first, real period of globalization. It was a period market by “countries meshed in profound interdependence wielding tariff threats, standard-setting, technology theft, financial power, and infrastructure investment for advantage.”
On the surface, the period looked not too different from today.
Today, however, we have a world health pandemic to deal with, one that could enlarge differences and accelerate trends to separate.
But, Mr. Wolf goes on;
today’s world economy is far more integrated than ever before and so the costs of deglobalization must be correspondingly greater.”
Furthermore,
we need a far higher level of global co-operation than ever before if we are to manage our global commons.”
In other words, the world is way more connected now than it was in the early 20th century.
Knowledge and Knowhow
This is where I come back to my earlier statement: during the past sixty years, information grew and spread at a pace never before seen; advancing technology became the norm of economic advancement. Knowledge and knowhow was the foundation of the spread of globalization.
And, history shows that nations or people can slowdown the growth and spread of information, but they can never reverse what has already occurred.
Therefore, information will be the driving force going forward. The world, as Mr. Wolf states, is “far more integrated than ever before.” The integration lives off of information,. One way or another, the world will continue to seek information and this will be the inherent driving force behind any renewal that might take place in globalization.
No matter how narrow-minded, or, blinded leaders might be…no matter how they might try to close-down this thirst for information, this drive to build up knowledge and knowhow, they will in the longer-run fail.
Yes, some success in slowing down the growth and spread of information might take place for a while, but they will return and reignite the quest for more and more information…throughout the world.
The Flow of the World
Those that fight the growth and spread of information, work against the flow of history. It is a hard battle and one they cannot expect to win. Better for us to work with the flow and build toward a more successful and more equitable global environment.
Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
