Thursday, May 24, 2007

Lack of Fairness a Globalization Risk

Creating a fairer globalization is not just the right thing to do, it is also a way of making the global economy more stable and sustainable. The Wall Street Journal ran an article on its front page today entitled, "Globalization's Gains Come With a Price--While Poor Benefit, Inequality Feeds A Backlash Overseas."

The piece confirms what we know: Contrary to economists' predictions, globalization is widening the income gap between the rich and poor in many poor countries:

"Globalization deserves credit for helping lift many millions out of poverty and for improving standards of living of low-wage families... But because globalization is also creating more inequality, it is raising questions about how much inequality countries can bear and whether these gaps could ultimately produce a backlash that will undermine trade and investment liberalization around the world."

And therein lies the rub. Lack of fairness is a risk to the current form of globalization. As a result of inequity, populist political candidates have gained ground in Latin America and China worries about social stability. The perfect quote is from Chinese Premier Wen Jiabao last March in which he says his government must "safeguard social fairness and justice and ensure that all of the people share in the fruits of reform and development."

On a related note, when I was in Shanghai last week, I asked a senior think tanker to name the biggest challenge facing Chinese society today. His answer was, "a lack of ethics." The Cultural Revolution left society with a vacuum in social values that is being filled by consumerism today. Corruption, lack of trust, and greed plague China.

It seems the Chinese government is even starting to get religion, literally. He and other Chinese officials have asked me about the positive role religion can play in providing an ethical framework in society. Given the rapidly growing Christian population in rural China, a solution may be in plain sight.

Christian church in China, seen from Shengyang to Harbin bus. Photo by Brian Yap (Creative Commons Attribution-NonCommercial 2.0).

Christian church in China, seen from Shengyang to Harbin bus. Photo by Brian Yap (CC).

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