Today's SPIEGEL ONLINE provided the final installment in the translations of excerpts from Gabor Steingart's Weltkrieg um Wohlstand ("war for wealth") book. Once again the title is as provocative as it is relevant: "Twisting the Knife: Consumers Are Killing the Welfare State." This one actually makes an excellent companion piece to the Book TV broadcast of a lecture that Joseph Stiglitz recently gave to the World Bank to discuss his new book, Making Globalization Work. Stiglitz is the perfect antidote to anyone who has had too much over Tom Friedman's cheerleading, and he even took Friedman on by using the guy's own language. I cannot duplicate the words exactly; but what Stiglitz said went something like "Not only is the world not flat, but it is getting less flatter every day." This then gave him an opportunity to discuss the unpleasant consequences that may ensue from a Digital Divide which is growing larger, rather than smaller.Unlike Friedman, Steingart is not concerned with the mission of making us feel good. He writes about German consumers; but he could just as well be writing about consumers in any industrialized and Internet-rich country:
The normal shopper at a German department store like Karstadt, wholesale retailer Metro or grocery discounter Lidl is a downright globalization fanatic. He compares prices and services but not nationalities or their social security systems. He wants his rebates and does not want additional charges. He is interested in the good deal, not in the dirty business already going on elsewhere in the world.
Even if he considers himself a romantic, he is actually a materialist by the book. It is only outside of business hours that he occasionally entertains idealistic doubts. And only then does he start to ask himself how it can be that he can obtain such large carpets so cheaply or why the prices on computers and mobile phones these days are so low.
This eventually leads him to a punch line that is not unfamiliar but still bears repeating at every opportunity:
What is important at this juncture is simply the realization that the global labor market, as we have invented it up to now, has created a unified sovereign territory for goods producers. The demand for labor now moves from one land to another, and naturally prefers those states with the lowest possible supplementary social costs.
Many who considered the social market economy to be the final stage of history are now being forced to admit they made a colossal error. Capitalism has, thanks to a global labor and finance market, increased its range, while the social safety net has lost ground. The market has gained power, speed and apparently also inevitability. But the social triumph of yesteryear has faded. Indeed, capitalism is going back to its roots.
I suppose I have enjoyed reading these essays because Steingart follows a path that I have tried to advocate for some time, the path of reasoning about consequences. In all fairness to the average consumer, it is not easy to reason about consequences when your finances demand that you get the best price for every purchase you make. So perhaps Steingart has been a bit extreme in picking on those consumers, but whom should he target? It is all very well and good to say that governments ought to deal with long-term questions of economic viability; but what are any of us to do when a government shirks that responsibility? Passionate talk of revolution is no solution, since the odds are not good that the resulting system will be any more conducive to long-term thinking. Unpleasant as it may sound, we may all have to face up to being responsible for our own assets and apply those assets towards building a safety net that can withstand future abuses from the movers and shakers of the global economy.
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