<p>There is the view held by some that the America we see today in all its ugliness is a passing phase, a rough patch the world has landed in because the country chose the wrong leader with poor thinking, bad morals and doubtful business acumen. The temptation to attribute the tectonic shifts in US policy to the actions of an individual, or indeed to stretch this to see at work a Nixonian “madman theory” (broadly, irrationality as strategy), misses the deep fissures in American society, interlocked with rising tensions from globalisation that have been overlooked far too long. It is these fissures that, in part, led to the rise of Donald Trump as President in a narrow victory in 2016, and after a gap of four years, a thumping win that indicated a clear endorsement of MAGA (Make America Great Again) politics, coupled with nonchalance on questions of his integrity and moral standing. </p>.<p>Globalisation has many meanings and definitions, but seen from the lens of the last four decades or thereabouts, it evokes notions of a “flat world” — to use the imagery of Thomas Friedman’s book with that title. In it, he speaks of a conversation in Bengaluru where he is told that while a steak cannot be served online and haircuts cannot be remote, India can book the window seat at the restaurant and the appointment with a barber of choice, right from a call centre! That is presented as the promise of a globalised world, in which the US-based accountant, who loses his job to Indians running the numbers from a remote centre at a fractional cost, will have to just live with it. Interestingly, US Vice President J D Vance brought up the same question last month at a tech summit, referring to a 2016 conversation he had in Silicon Valley with the CEO of a multibillion-dollar tech company.</p>.<p>Forget loss of income, what will replace the loss of a sense of purpose and a loss of dignity, Vance asked, and then quoted the reply he got from the CEO: “Digital, fully immersive gaming!”. Vance said his wife, who was with him at that meeting, had then remarked: "Let's get out of here. These people are crazy."</p>.<p>The tariffs war that Trump unleashed on April 3 is America getting out of a global arrangement that it now sees as “crazy”, even if it is the system that it built and ran, as the country pushed the narrative of globalisation as the then new growth mantra. Now, Trump put out a new set of barriers that will surely escalate tensions, kill global trade and signal the end of the World Trade Organisation. The pain will be global, but its roots lie in the changing socio-economic landscape of America.</p>.<p>The disappearing factories, the recurring cycle of layoffs, rising consumerist culture fed by an aggressive, even intrusive marketing machine, the erosion of trade unions and the voice of workers in general, and the overwhelming power of corporate America — these factors have contributed to a situation that is now being blamed on the ills of globalisation and its companion, the outsourcing boom. Yet, Trumpism will not or cannot see that globalisation is not disconnected from — and indeed is nothing more than an extension of — capitalism at work.</p>.<p>This is, after all, a system that goes for the lowest wages and drives the maximisation of profit. This is in the true spirit of Milton Friedman, who famously wrote on September 13, 1970: “The social responsibility of a business is to increase its profits,” sparking a shareholder value chase that, in the end, debased the very idea of capitalism by legitimising a free run of profits for business often at the cost of responsible behaviour.</p>.<p>Consider the tormenting nature of the churn today: a) In 2019, corporate America formally rejected the Friedman doctrine (as many as 181 top global CEOs at the 2019 Business Roundtable signed a new purpose of the business corporation, rejecting shareholder primacy) b) It has been loud (though not effective) in its embrace of DEI (Diversity, Equity, Inclusivity) principles and c) It sought to stand up for the planet and people but d) equally would stand in favour of driving down labour costs with extractive contracts in distant parts of the globe, which is globalisation and effectively Friedman’s maximisation of profits at work.</p>.Donald Trump defies market wisdom, and look who'll pay.<p>Now, the mash-up is complete when Trump asks businesses to reject DEI, dump sustainability and celebrate profits while he prepares to sharply lower taxes but also work to make America great, which is a mission very different from profit.</p>.<p>This is a kind of caricaturised Friedman, neither here nor there. Its ideas get truncated at the border, State power is centralised and coercive even as the State is being effectively disbanded, and discordant voices are silenced. Those silenced include businesses that have readily (and probably happily) succumbed to pressure from Trump by throwing out their DEI policies.</p>.<p>Some of these tears point to structural inconsistencies in a system ripe for a collapse, waiting for the right conditions. This is what is playing out in the world’s largest economy today. An argument can be made that capitalism has lost its way and is under severe strain in the land that champions it the most, and Trump’s wild moves are the big battle to save it from collapse, whatever be the cost.</p>.<p>Even if America has its way, there is little doubt that the losses added up on the American balance sheet far outweigh its proclaimed positives, which include its long-presented values of democracy, openness, fair trade, human rights and the like. Forget the 1941 ‘Four Freedoms’ speech of Franklin D Roosevelt, in which he proposed four fundamental freedoms that people “everywhere in the world” ought to enjoy: Freedom of speech and expression, freedom of worship, freedom from want, and freedom from fear. Some 85 years down the line, America would score poorly on all four.</p>.<p>This is not the new world order that was envisaged when the World Trade Organization (WTO) was formed, or indeed, when a series of multilateral institutions took shape in the aftermath of the chaos of the World Wars, or the world in which countries like India agreed to go with frameworks like the new intellectual property rights regime so that we moved from process to product patents in the pharma sector.</p>.<p>Ashwani Mahajan of the Swadeshi Jagran Manch, the RSS’s economic wing, is right in pointing out that there is a total disregard for WTO, and with it gone, India should be free of the Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement, a child of the WTO. According to Mahajan, TRIPS has cost India heavily in terms of outgo of royalty; the nation has moved from a negligible amount of royalty to over $17 billion. The overriding of WTO by the US lends credence to the view of many in the developing world that these complex arrangements couched in principles were always meant to protect the interests of the US and its profiteering businesses. However, it will not be easy to walk out, given that India has too much at stake in maintaining and building a relationship with the US.</p>.<p>(Jagdish Rattanani is a journalist and faculty member at S P Jain Institute of Management and Research, Mumbai. Views are personal)</p>
<p>There is the view held by some that the America we see today in all its ugliness is a passing phase, a rough patch the world has landed in because the country chose the wrong leader with poor thinking, bad morals and doubtful business acumen. The temptation to attribute the tectonic shifts in US policy to the actions of an individual, or indeed to stretch this to see at work a Nixonian “madman theory” (broadly, irrationality as strategy), misses the deep fissures in American society, interlocked with rising tensions from globalisation that have been overlooked far too long. It is these fissures that, in part, led to the rise of Donald Trump as President in a narrow victory in 2016, and after a gap of four years, a thumping win that indicated a clear endorsement of MAGA (Make America Great Again) politics, coupled with nonchalance on questions of his integrity and moral standing. </p>.<p>Globalisation has many meanings and definitions, but seen from the lens of the last four decades or thereabouts, it evokes notions of a “flat world” — to use the imagery of Thomas Friedman’s book with that title. In it, he speaks of a conversation in Bengaluru where he is told that while a steak cannot be served online and haircuts cannot be remote, India can book the window seat at the restaurant and the appointment with a barber of choice, right from a call centre! That is presented as the promise of a globalised world, in which the US-based accountant, who loses his job to Indians running the numbers from a remote centre at a fractional cost, will have to just live with it. Interestingly, US Vice President J D Vance brought up the same question last month at a tech summit, referring to a 2016 conversation he had in Silicon Valley with the CEO of a multibillion-dollar tech company.</p>.<p>Forget loss of income, what will replace the loss of a sense of purpose and a loss of dignity, Vance asked, and then quoted the reply he got from the CEO: “Digital, fully immersive gaming!”. Vance said his wife, who was with him at that meeting, had then remarked: "Let's get out of here. These people are crazy."</p>.<p>The tariffs war that Trump unleashed on April 3 is America getting out of a global arrangement that it now sees as “crazy”, even if it is the system that it built and ran, as the country pushed the narrative of globalisation as the then new growth mantra. Now, Trump put out a new set of barriers that will surely escalate tensions, kill global trade and signal the end of the World Trade Organisation. The pain will be global, but its roots lie in the changing socio-economic landscape of America.</p>.<p>The disappearing factories, the recurring cycle of layoffs, rising consumerist culture fed by an aggressive, even intrusive marketing machine, the erosion of trade unions and the voice of workers in general, and the overwhelming power of corporate America — these factors have contributed to a situation that is now being blamed on the ills of globalisation and its companion, the outsourcing boom. Yet, Trumpism will not or cannot see that globalisation is not disconnected from — and indeed is nothing more than an extension of — capitalism at work.</p>.<p>This is, after all, a system that goes for the lowest wages and drives the maximisation of profit. This is in the true spirit of Milton Friedman, who famously wrote on September 13, 1970: “The social responsibility of a business is to increase its profits,” sparking a shareholder value chase that, in the end, debased the very idea of capitalism by legitimising a free run of profits for business often at the cost of responsible behaviour.</p>.<p>Consider the tormenting nature of the churn today: a) In 2019, corporate America formally rejected the Friedman doctrine (as many as 181 top global CEOs at the 2019 Business Roundtable signed a new purpose of the business corporation, rejecting shareholder primacy) b) It has been loud (though not effective) in its embrace of DEI (Diversity, Equity, Inclusivity) principles and c) It sought to stand up for the planet and people but d) equally would stand in favour of driving down labour costs with extractive contracts in distant parts of the globe, which is globalisation and effectively Friedman’s maximisation of profits at work.</p>.Donald Trump defies market wisdom, and look who'll pay.<p>Now, the mash-up is complete when Trump asks businesses to reject DEI, dump sustainability and celebrate profits while he prepares to sharply lower taxes but also work to make America great, which is a mission very different from profit.</p>.<p>This is a kind of caricaturised Friedman, neither here nor there. Its ideas get truncated at the border, State power is centralised and coercive even as the State is being effectively disbanded, and discordant voices are silenced. Those silenced include businesses that have readily (and probably happily) succumbed to pressure from Trump by throwing out their DEI policies.</p>.<p>Some of these tears point to structural inconsistencies in a system ripe for a collapse, waiting for the right conditions. This is what is playing out in the world’s largest economy today. An argument can be made that capitalism has lost its way and is under severe strain in the land that champions it the most, and Trump’s wild moves are the big battle to save it from collapse, whatever be the cost.</p>.<p>Even if America has its way, there is little doubt that the losses added up on the American balance sheet far outweigh its proclaimed positives, which include its long-presented values of democracy, openness, fair trade, human rights and the like. Forget the 1941 ‘Four Freedoms’ speech of Franklin D Roosevelt, in which he proposed four fundamental freedoms that people “everywhere in the world” ought to enjoy: Freedom of speech and expression, freedom of worship, freedom from want, and freedom from fear. Some 85 years down the line, America would score poorly on all four.</p>.<p>This is not the new world order that was envisaged when the World Trade Organization (WTO) was formed, or indeed, when a series of multilateral institutions took shape in the aftermath of the chaos of the World Wars, or the world in which countries like India agreed to go with frameworks like the new intellectual property rights regime so that we moved from process to product patents in the pharma sector.</p>.<p>Ashwani Mahajan of the Swadeshi Jagran Manch, the RSS’s economic wing, is right in pointing out that there is a total disregard for WTO, and with it gone, India should be free of the Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement, a child of the WTO. According to Mahajan, TRIPS has cost India heavily in terms of outgo of royalty; the nation has moved from a negligible amount of royalty to over $17 billion. The overriding of WTO by the US lends credence to the view of many in the developing world that these complex arrangements couched in principles were always meant to protect the interests of the US and its profiteering businesses. However, it will not be easy to walk out, given that India has too much at stake in maintaining and building a relationship with the US.</p>.<p>(Jagdish Rattanani is a journalist and faculty member at S P Jain Institute of Management and Research, Mumbai. Views are personal)</p>