Forecasts of a coming economic storm may not be far off in light of the recent frenzied trading of frightened investors. Although this would bring further turmoil on a global scale, it would also create a perfect storm for profound change.
The Euro zone has so far been unable to extract itself from a debt crisis that is expected to have a domino effect in the region. Greece, still teetering on bankruptcy, would be the first block to fall. Meanwhile, the American economy is sputtering along, struggling to boost employment. Even China, the ascending superpower, is experiencing sluggish growth.
It makes me think back to the late 1990s and early 2000s, when globalization was a dirty word in activist circles (recall the Seattle riots of 1999 in response to the World Trade Organization conference.)
Resistance to the then-emerging concept centred on environmental, human rights and income inequality issues. It bears a striking resemblance to the umbrella of issues encompassed by today’s Occupy Movement.
Economics-wise, globalization meant breaking down barriers to international trade, such as uneven regulation between countries (portrayed by activists as a slackening of rules). More generally, it was used to describe the less tangible idea of a growing global interconnectedness.
In Canada, the first sign came in the form of the North American Free Trade Agreement. Then, in 1995, we joined the World Trade Organization.
Lots of free trade agreements later, there is plenty of evidence to support the predictions protestors made: the Pembina Institute has sounded the alarm over surging greenhouse gas emissions as the development of Alberta’s oil sands steams ahead; Canadian mining giants, such as Barrick Gold, have faced allegations of human rights abuses abroad; and a Canadian Centre for Policy Alternatives study has shown a rising income gap in the country.
None of this seemed to faze policymakers when economies around the globe were in a state of rapid growth. But now, with economies veering toward what appears to be a double-dip recession, they’re grappling (rather unsuccessfully) with how to course correct what is essentially a systemic problem.
Recessions happened before the phenomenon of globalization, true. But this meltdown is the most severe we’ve had since our economies became so tightly intertwined. Its effects can’t be contained within borders, and in spite of their best efforts, policymakers have yet to put us on a clear path to recovery.
Canada has been relatively insulated from the worst of it so far, thanks to a more tightly-regulated banking system. However, if the Euro zone and U.S. keep backsliding, the effects are sure to bleed across the border.
Herein lies the opportunity to effect change—a period of prolonged crisis, with all other options exhausted.
And as Lia Grainger recently reported in “Among the Rebels,” a May/June 2012 This feature, the Occupy Movement may yet see a second wave—this time with a stronger Canadian contingent.