The Golden Hinde continues side watching the political debate ahead of the autumn parliamentary elections in Australia. The coalition attempts to denigrate the actual state of the Australian economy and tensions are obvious in both the Coalition as Labor Party when it comes to the perception of globalization and the challenges ahead.
It is not unique, but rather a phenomena that goes back to political arenas worldwide. To fend off the domestic current debate to keep or re-gain political power of government, or to stand up for the international values? We’ve seen it for a long time in Europe, long before the economic crisis: it’s always easier to blame the policy challenges “those others in the EU” than to deal with the complexity of today’s and tomorrow’s challenges are about.
Where is the political balance in society between affirming globalization or protectionism to act in the political arena? If we give all power to the states, we protectionism and autarkies. But if we choose the other path, hyper globalization with total mobility of goods, services and capital, we remove states chance to provide what is needed for markets to function well, as regulations the legitimacy of markets through social insurance and collective democratic decision-making. If we push too hard for globalization, paradoxically we will erode gains from globalization, both because we have a lack of regulation and for that we are undermining the legitimacy of the economic system.
Euro zone example is a deep structural crisis, and there are reasons to be pessimistic about the development. The Euro zone-challenges meet the globalization dilemma. If you want integrated markets, you also must have a democratic government to develop it. If the euro area would be integrated, it must have a democratic political union. Otherwise, you have to give up the economic union.
Similar discussions could take place around Australia’s future economy: A country that is so dependent on their powerful neighbors and growing emerging markets; how far down in the furrow protectionist can you afford to dig yourself down? What are the most progressive views on migrant worker policies and cooperation to promote economic growth? What are the Julia Gillard vs Tony Abbott thoughts upon on this – will they show that they understand the complexity of globalization or will they just focus on what will happen on September 14th?